Alan Greenspan On Bitcoin: I Guess It Is A Bubble

Why Bitcoin Is Here To Stay

Bitcoin is here to stay. Detractors will be proven wrong, no matter how many Nobel-prizes they won.
There's enough detractors. "It is a bubble" (Jamie Dimon, Alan Greenspan, Robert Shiller). "It offers people places to hide" (Jack Lew), "Bitcoin is Evil" (Paul Krugman), "it's too volatile"....
To be sure, some of these detractors are undoubtly very smart, but still it seems that they Just Don't Get It.
And that's what I don't get. It is crystal clear that bitcoin is not just a fancy technology, but a new paradigm that will change the world.
For starters, for the first time in human history, it is possible to store wealth such that it is private and secure. In other words, bitcoin offers the possibility to store wealth such that it can not be stolen or confiscated. This on its very own is an important raison d'etre for bitcoin. Plus that you can transfer value as easily as sending an e-mail, without needing anyones permission, at virtually no cost and without having to trust or rely on a third party. This is unprecedented in human history. This has enormous utility, as Wikileaks can attest.
Ultimately, bitcoin is the enemy of every government in the world. I find it unsurprising that its inventor choses to remain anonymous for the time being.
It is strangely amusing to see Jack Lew brushing off bitcoin as "offering a place to hide" and at the same time calling for a raise of the US debt ceiling. It can be disturbing to see Nobel laureates trolling bitcoin. And that is just the start of it.
What will happen next, is a full-on attack on bitcoin by governments worldwide, under the guise of money laundering, terrorism, drugs, child porn, organ trading, you name it. I also expect the US government to become a lot less welcoming to bitcoin rather sooner than later.
What can they do? Well, for instance, the US could declare it to be illegal for businesses to accept bitcoin as a payment. Obviously this will cause the value of bitcoin to plummet.
But, to paraphrase Jamie Dimon, that will not "be the end of it". For starters, such draconic measure will raise a lot of hard questions, because then just as well outlaw cash payments. But that's not even the point.
Because - you might as well outlaw bad weather. It is pointless. Bitcoin is designed to be fully resilient against governmental hostility. And it better be. It must be resilient, and it is, making it unstoppable, just as free speech is unstoppable. There is no way the government can prevent from two people meeting up and exchanging bitcoin and cash or goods. There is no way a government can force to keep wealth in a way that it can be confiscated. And that is what governments historically do: confiscate wealth, through inflation, through confiscation, through force.
Governments are important, but unfortunately: power corrupts. Bitcoin has the ability to give back many of the powers of government to the people. This is also a history-first. In the future, it will force governments to serve the community. Bitcoin has the potential for people to tolerate governments, instead of the current situation in which governments are endured.
Perhaps you find that the last paragraph sounds too far-fetched. It is not. Perhaps bitcoin will be not bitcoin but a different, improved crypto-currency. That's very unlikely, but most importantly - even if bitcoin would be replaced by a superior crypto-currency, this story would remain exactly the same except for the word 'bitcoin'.
What I want to achieve with this post is to give some historical perspective. There is a large group of people either dismissing bitcoin as a fad, or even be hostile. This is fully understandable, because it is not that easy grasp the potential, or to have an opinion differing from that of various Nobelprize laureates.
To bitcoin adopters I'd like this to say if you allow me. Be patient and try to explain the concept to people who are critical towards bitcoin. Don't attack them when they understandably dismiss bitcoin. Don't troll them back when they troll you. Defend bitcoin on its merits, that's plenty enough. Stick to facts.
What must be avoided is polarisation between those who have bitcoin and those who don't. Right now such polarisation doesn't matter much. But it must be avoided. There is no point in rubbing in that the other person is stupid because you bought bitcoin for a tenth of the current price. All it will do is create envy and hostility. Instead, explain why bitcoin might be useful, on its merits.
submitted by trilli0nn to Bitcoin [link] [comments]

Bitcoin: I don’t have enemies

On January 3, 2009, Satoshi was busy from afternoon to dusk, creating, compiling and packaging the first open source code in a small server in Helsinki, Finland. After running SH A 256 operation, RIPEM D-160 operation, and writing version type, Base 58 coding, the first BLOCK of the BTC world was created at 18:15 on January 3, 2009. This day was called “Creation Day” by BTC believers, and this BLOCK is also called “Creation block." On this day, Bitcoin (hereinafter referred to as "BTC") was born.
In the past five years, BTC has experienced a lot of things. First, it was accepted by programmers and password punks in the geek circle. In their view, BTC provided a new perspective, when the cryptographic algorithm holds the open source program as weapon running on the P2P network, this is a fantasy world like "The Matrix". They quickly accepted BTC and spread its ideas. Some programmers developed third-party applications based on source code, which is also the prototype of the current BTC industry chain. Overall, this is a very legendary start. This circle is also a pure, professional group in highly ideal color. There is no power to roll, no money to chase, no speculation, and everything is only related to technology and hobbies. So, that programmer who bought a $25 pizza with 10,000 BTC in 2010 was asked if he regretted it. He replied: Pizza is delicious. But then, all of this changed slowly. In July 2010, the Mt. Gox platform was established. People in the gray economic circle began to move toward the “Silk Road”; in November of the same year, the price of BTC reached 0.5 US dollars and the BTC economy reached 1 million, which attracted the attention of the profit-seekers; in April 2011, the well-known American financial magazine "Times" and "Forbes" published reports on BTC one by one.
Humanistic technologists become interested; on December 6, 2012, the first officially recognized bitcoin exchange was born in France, and the visionary government began to think... Since 2013, as the market value has risen rapidly, the debate has become more and more fierce. Former US Federal Reserve Chairman Alan Greenspan said that BTC is a bubble with no intrinsic value. Nobel economist Krugman called BTC a historical retrogression. Whether it is in politics, economics, sociology, or even science, there are strong opposition voice. No matter how many people are hostile to Bitcoin, the answer given in the book Bitcoin is: I have no enemies - I am just an open source program, a cryptographic algorithm, a new technology, a P2P electronic payment system, a good idea... Although the liberals in the technical world will give me great ideals, the anarchists in geeks even regard me as a modern belief, I just want to solve practical problems through technology and make human feel convenient in actual interaction. In 2011, he began to contact BTC. Chang Jia, the author with genius mathematical thinking, who stepped into BTC world in 2011, said that for liberals, Bitcoin is Noah’s Ark, which can carry them to a free paradise; for the Silk Road, Bitcoin is snow job; for organizations like the Bitcoin Foundation, the Bitcoin community needs to actively engage with regulators to avoid potential policy reefs. The book "Bitcoin" is mainly about "I am solving problems, not making trouble": For the government, BTC is not an enemy. As long as the nation-state still exists, the legal currency will exist; as long as the government itself respects the marketization of the legal currency, then BTC can only become a supplement. For financial capital, large financial companies such as Visa, MasterCard, and Morgan can learn from the BTC's moveable value mechanism and parasitize on the BTC node. In a further step, they can introduce third-party agreements from banks, which can promote modern finance to a full Information height. For the economics community, many economists, especially Keynesianism, feel that BTC subverts traditional economic theory, natural deflationary attributes will only encourage speculation and ignore value, but in fact BTC will eventually belong to the essence value holders and the whole society. For the media, BTC not only provides free faith, but also provides an economic self-reliance. BTC and media are inherently natural alliances. For individuals, BTC is not an enemy. Money indiscriminate causes inflation to exploit people's wealth all the time. BTC offers the possibility of additional wealth preservation. At the very least, because BTC competes with fiats, the central bank will not be too unscrupulous.
In the future, the BTC world should pay more attention to the time stamp service and integrate more information into the encryption protocol not just currency; design a BTC third-party protocol access mechanism to complement and intersect with more traditional industries; strengthen decentralized Dropbox and its other extensible services. The core idea of ​​Bitcoin is not to misunderstand the emergence of BTC, which is just to make human life better, like the Internet. The Internet doesn’t have enemies, nor does BTC.
submitted by FmzQuant to u/FmzQuant [link] [comments]

Removed comments from Economics subreddits - 07/18/18

wow what a commie /s
Comment removed from /Economics - test822 - Created on 07/18/18 00:06:16 UTC - permalink
Very troubling.... That people are catching on
Comment removed from /Economics - wtf_is_taken - Created on 07/18/18 00:15:11 UTC - permalink
I'm certain that the Fed's concern is authentic!
Comment removed from /Economics - Tranejam - Created on 07/18/18 00:25:51 UTC - permalink
Our area has been a hot market, growing for the last 6-7 years, but it’s slowed down significantly this summer. Last summer, houses had several offers the day they went up for sale, but this summer there’s not much movement. We’re either in a bubble or just reached the max price in my area.
Still, our house “value” (theoretical until someone actually forks over the money) is 43% higher than when we bought it 5 years ago. Can’t say we would fork over that kinda cash if we were just buying now.
Comment removed from /Economics - BiffyMcGillicutty1 - Created on 07/18/18 00:33:54 UTC - permalink
I've got a house for ya..
Comment removed from /Economics - MrPractical1 - Created on 07/18/18 00:47:44 UTC - permalink
I wonder if that means they’ll renege some of these planned interest hikes? Probably not.
I’ll bet he also talks about how poor food service employees are treated as he tips 2%.
Comment removed from /Economics - GortonFishman - Created on 07/18/18 00:48:44 UTC - permalink
Incredible! I look forward to nothing being done about it.
Comment removed from /Economics - Yolo420dab - Created on 07/18/18 00:51:59 UTC - permalink
Really? And you are just now realizing this? Oh, that’s right...you are are a card-carrying member of the elite, so your life has been minimally impacted, unlike most of ours.
Comment removed from /Economics - smitty637 - Created on 07/18/18 01:11:29 UTC - permalink
The greatest period of economic growth in U.S. history was when there was no central bank. The Fed Reserve is a ponzi scheme.
Comment removed from /Economics - s4mu8l - Created on 07/18/18 01:11:59 UTC - permalink
they hurt more than they help. tax policy should take more into account than just the government's budget
Comment removed from /Economics - ThereIsReallyNoPun - Created on 07/18/18 01:22:13 UTC - permalink
Were? Latest round has just begun.
Comment removed from /Economics - guisar - Created on 07/18/18 01:41:32 UTC - permalink
You're right still today people are on some bad shit.
Comment removed from /Economics - SporkydaDork - Created on 07/18/18 01:42:53 UTC - permalink
No my friend, there isn’t. Eventually global wages will reach an equilibrium point. It may take 50 years to happen, but if businesses are shopping for the cheapest combination of labor and production costs, their tendency to minimize costs will force wages lower.
Compare this to workers seeking better wages with limited mobility (i.e. they may or may not be able to travel for better pay) and you can see pressure to keep wages higher.
The interplay of these two forces will always mean that eventually wages will be similar everywhere.
Comment removed from /Economics - StormCrow1986 - Created on 07/18/18 01:48:40 UTC - permalink
It'll be real troubling when the guillotines come out
Comment removed from /Economics - maahhkus - Created on 07/18/18 01:57:34 UTC - permalink
That assumes social factors won't interfere. Inefficiencies in the economic development of some countries will negatively affect wages, wars will change the economic standing of some countries and facilitate migration, someone in a particular country will develop technology that drives their economy, etc. Economies are not static, and there will always be outside forces that prevent an equilibrium from forming naturally. On its own, the ocean would eventually stop making waves: but external forces like the tide or geothermal vents will continue influencing it for the foreseeable future. Same thing with economics.
Comment removed from /Economics - lordderpingtonthe3rd - Created on 07/18/18 02:04:19 UTC - permalink
But muh trickle downs
Comment removed from /Economics - antman152 - Created on 07/18/18 02:09:40 UTC - permalink
Heck, this keeps up and they may have to downgrade to 'Concerning'.
Heck, we may even see, in our lifetime, a drop to Vexing.
Truely, a historic moment in time.
Comment removed from /Economics - alanthar - Created on 07/18/18 02:13:34 UTC - permalink
Douglas Holtz-Eakin; Former Chairman of the Presidential Council of Economic Advisors (Bush) & Former Director of the Congressional Budget Office (Republican Congress) said in 2014 that income inequality needed to be addressed at the national level but it wouldn't happen because it had become a partisan political issue - making compromise impossible.
In 2014 Alan Greenspan (Former Chairman of Fed Reserve) & Christine Lagarde (Director of the International Monetary Fund) both addressed income inequality at the National Association for Business Economists.
Greenspan called income inequality "the most dangerous trend affecting the US", and Legarde said "rising inequality and economic exclusion can have pernicious effects"
The NABE's own membership have called for government economic policy to address income inequality because several large businesses refused to acknowledge its existence and were spending more money trying to fight it than a solution would cost.
They aren't "just now realizing" it, they just know that it's political suicide to bring it up while Republicans are in charge - even if they are Republicans.
Comment removed from /Economics - meauho - Created on 07/18/18 02:13:56 UTC - permalink
NAFTA had a negligible effect on employment and wages while it improved net economic welfare.
https://www.usitc.gov/publications/332/ec201406a.pdf
http://faculty.som.yale.edu/lorenzocaliendo/ETWENAFTA.pdf
https://fas.org/sgp/crs/row/R42965.pdf
https://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.15.1.125
Comment removed from /Economics - lalze123 - Created on 07/18/18 02:14:32 UTC - permalink
Today is the 100th anniversary of the logical outcome of extreme income disparity: a small number of people shot and thrown down a mineshaft.
I'm not saying that's an ethical or good way of responding to this problem, but it's certainly one standard outcome when it's allowed to go on too long and to a great extent.
Comment removed from /Economics - tomdarch - Created on 07/18/18 02:16:00 UTC - permalink
What is the Federal Reserve saying?
Comment removed from /Economics - cyber_rigger - Created on 07/18/18 02:18:06 UTC - permalink
Mercantilism is the only way! /s
Comment removed from /Economics - mustdashgaming - Created on 07/18/18 02:30:02 UTC - permalink
Wow. Does the federal reserve chair have any thoughts on massively devaluing our currency, bailing out big banks, or fucking with the US economy over and over again with decisions made from unelected officials?
Comment removed from /Economics - waffleezz - Created on 07/18/18 02:32:50 UTC - permalink
I live in Iowa - it's a sellers market on the Iowa side of the river. There are a lot of people moving out of Illinois - something about taxes and unfunded government liabilities...
Comment removed from /Economics - Sam_Fear - Created on 07/18/18 02:37:50 UTC - permalink
Jerome Powell: Man of the People. I guess they did the math and figured out they've screwed the workers so bad there's nothing left to steal from them.
Comment removed from /Economics - wwwwho - Created on 07/18/18 02:44:36 UTC - permalink
Come on the Fed Chair not understanding basic economics isn't news.
Comment removed from /Economics - beyond_hate - Created on 07/18/18 02:59:22 UTC - permalink
NAFTA
Comment removed from /Economics - goofzilla - Created on 07/18/18 03:00:31 UTC - permalink
really now
i'm shocked, this is new information to me
Comment removed from /Economics - DapperMasquerade - Created on 07/18/18 03:01:06 UTC - permalink
I hate long-run equilibrium arguments for two reason:
  1. Perot makes a good point that I think many people would miss. In 15-20 years, wages would equalize. But in the meantime, you've "wrecked the country" (his words, not mine). If harm is done to the country in that 15-20 year period, it's possible that the short-term harm is actually greater than the long-term gain. This is not NAFTA-specific. It applies to a lot of cases.
  2. By the time equilibrium would have been reached after one particular adjustment to some part of the system, many other adjustments, shocks, and changes will have occurred. Therefore, unless equilibrium will be reached quickly (my guess is less than 1 year is probably safe) then you run the risk of the equilibrium you planned for never materializing at all, and something else taking its place. The global economy is a big, chaotic, dynamical system. Shit happens outside of the one particular market you happen to be looking at.
Comment removed from /Economics - nerdponx - Created on 07/18/18 03:04:18 UTC - permalink
I'm sorry. Just trying to maximize efficiency and remove that deadweight loss yknow
Comment removed from /Economics - WMSTEOOPAAFFWC - Created on 07/18/18 03:22:43 UTC - permalink
Yes, many of us are very troubled. Now what?
Comment removed from /Economics - neomech - Created on 07/18/18 03:25:25 UTC - permalink
Average annual wages for workers has increased almost every year, who cares if they make a smaller share if they’re making more money?
economics by the way 😬
Comment removed from /Economics - HitemwiththeMilton - Created on 07/18/18 03:37:55 UTC - permalink
LOL
Federal Reserve chair comments about ANYTHING regarding the state of the USA is ridiculous. -98% value of the dollar since the fed was established to add debt to every dollar printed. But its okay cuz no one is paid in USA currency, right?
Comment removed from /Economics - Anon48529 - Created on 07/18/18 03:52:26 UTC - permalink
You begin to see why cocaine wasn't just a rich person's drug back then
Comment removed from /Economics - SuperHighDeas - Created on 07/18/18 04:23:56 UTC - permalink
yes, but clearly we went the other direction for over 100 years, I'm asking how.
Comment removed from /Economics - SamSlate - Created on 07/18/18 04:24:15 UTC - permalink
Don’t suck Bilderberg, Rothschild and Soros dick then. These guys own most of the money in the world and just want to build a global government, single market, and take 100%. Federal reserve serves the Rothschild, the Rockefellers, not the people.
Comment removed from /Economics - boomBoomcandydoom - Created on 07/18/18 04:30:54 UTC - permalink
Its against the rules to point out the federal reserve has attached debt to every dollar printed, resulting in -98% value of the dollar since 1913?
Adorable.
Comment removed from /Economics - Anon48529 - Created on 07/18/18 04:53:12 UTC - permalink
i mean thats fine but how the fuck do you have a "substantive contribution" to a thread that pretty much says "hey this really obvious thing is really obvious"
Comment removed from /Economics - DapperMasquerade - Created on 07/18/18 04:55:17 UTC - permalink
You know you’re on Reddit when the “economics” sub starts pushing socialist propaganda.
Comment removed from /Economics - HitemwiththeMilton - Created on 07/18/18 05:45:06 UTC - permalink
Shut the fuck up Federal Reserve chair you literal fucking vermin.
I bet America would find things "very troubling" if we ever audited you.
Comment removed from /Economics - sweden_person - Created on 07/18/18 06:16:01 UTC - permalink
It’s referencing and addressing the public figure whom the title quote belongs to. Public figures are not immune to insult or criticism per Reddit rules, Steve Huffman said.
Comment removed from /Economics - boomBoomcandydoom - Created on 07/18/18 07:37:01 UTC - permalink
knuckle dragging Neanderthals
You're goddamn right there.
Comment removed from /Economics - AJGrayTay - Created on 07/18/18 13:18:11 UTC - permalink
No.
Comment removed from /AskEconomics - microgrower40799 - Created on 07/18/18 13:48:55 UTC - permalink
You mentioned the word 'joke'. Chuck Norris doesn't joke. Here is a fact about Chuck Norris:
Chuck Norris does not need to know about class factory pattern. He can instantiate interfaces.
Comment removed from /badeconomics - Chuck_Norris_Jokebot - Created on 07/18/18 17:36:30 UTC - permalink
I'm pretty sure I'm going to have to offer myself of if I ever want to retire.
Comment removed from /Economics - stumpdawg - Created on 07/18/18 17:40:05 UTC - permalink
Terriers and Bariffs everywhere.
So does this mean whirlpool is sick of winning?
Comment removed from /Economics - stumpdawg - Created on 07/18/18 18:21:57 UTC - permalink
According to the article, LG's retail price went up by ~11% and Samsung's ~18%, while Whirlpool's prices shot up by 30% at Lowes. Consumers are looking at the higher prices and are opting to just not buy washing machines rather than buying Whirlpool's, so yeah, I think they're sick of winning, especially if additional tariffs on components continue to raise the MSRP.
Comment removed from /Economics - ddhboy - Created on 07/18/18 18:33:58 UTC - permalink
Or move to a cheaper place for retirement? Damn man, there are plenty of options better than killing yourself.
Comment removed from /Economics - zaccus - Created on 07/18/18 18:56:49 UTC - permalink
Cheaper place? That's not going to do me shit when I'm still working at 80
Comment removed from /Economics - stumpdawg - Created on 07/18/18 19:09:10 UTC - permalink
The COL of rural America is low. Its a lot lower than you think. A dollar goes so much further in rural America than it does in San Francisco.
My grandparents are almost 90 and they live very comfortably on Social Security alone. Just Social Security and nothing else. They recently bought a house. A very lovely home with a nice yard and garden. They're able to do that because rural Oregon is a very cheap place to live.
Comment removed from /Economics - Hyndis - Created on 07/18/18 19:18:26 UTC - permalink
And if social security goes private like the Republican party so desperately wants, then I lose everything?
My comment was hyperbole...but not by much.
Comment removed from /Economics - stumpdawg - Created on 07/18/18 19:30:09 UTC - permalink
Who could have known economics was so complicated?!
Comment removed from /Economics - ZmeiOtPirin - Created on 07/18/18 19:30:38 UTC - permalink
Social Security is a question of votes, not economics. Old people get Social Security. They would like to continue receiving Social Security. Old people all vote.
Any politician who wants to win an election (which is every politician) needs to pander to that voting block. This means don't touch Social Security. Its called the third rail of American politics for a reason. Touch it and die.
Comment removed from /Economics - Hyndis - Created on 07/18/18 19:33:27 UTC - permalink
Still getting my head around why people would want to retire...
Comment removed from /Economics - DxR77 - Created on 07/18/18 19:45:40 UTC - permalink
https://www.nirsonline.org/wp-content/uploads/2018/02/Millennials-Report-1.pdf
From the report itself, 8.8% of Asian millennials have > $100k saved for retirement. Far more than other racial groups.
I guess doing your homework and listening to your parents about what to major in does pay off*.
*Even though college acceptance boards discriminate against you, the odds are good you had to learn to speak English late in life, and your parents probably aren't college educated.
Comment removed from /Economics - whathe2016 - Created on 07/18/18 19:46:23 UTC - permalink
Mass genocide?
Comment removed from /Economics - Magic_Leather_Jacket - Created on 07/18/18 19:46:38 UTC - permalink
But it's going insolvent by 2030-2040, right after the average Boomer being statistically dead. It's a problem, but they're literally fighting to the death to keep unfunded entitlements that their children both have to pay for and likely won't see.
Comment removed from /Economics - cavscout43 - Created on 07/18/18 19:46:53 UTC - permalink
I was thinking old age.
Comment removed from /Economics - HTownian25 - Created on 07/18/18 19:47:51 UTC - permalink
Funny enough, this likely plays into why rural areas tend to be more conservative (as well as the educational differences).
That being said, I absolutely would ditch large urban metros when retirement age rolled around. Save for a Manhattan/Hawaii retirement, then move to rural Idaho or something when the day comes. Live like relative royalty.
Comment removed from /Economics - cavscout43 - Created on 07/18/18 19:48:30 UTC - permalink
wait...18 year olds don't have anything saved for retirement?? What a bunch of idiots.
Lumping a bunch of 18-37 year olds together and talking about statistics across that group is asinine.
Comment removed from /Economics - TDual - Created on 07/18/18 19:52:52 UTC - permalink
Well where’s the fun in that
Comment removed from /Economics - Magic_Leather_Jacket - Created on 07/18/18 19:53:27 UTC - permalink
You can still piss on their graves when they're gone.
Comment removed from /Economics - HTownian25 - Created on 07/18/18 19:57:12 UTC - permalink
I started saving at 25, wish I had started at 18, only one other person in my friend group is saving, a lot of them see it as something they don't have to worry about till they're older, I keep trying to tell them the earlier you start the easier it is, put away what you can afford to now so you're not playing catch up in the future but many people are more interested in spending now and saving later.
Comment removed from /Economics - redsalmon67 - Created on 07/18/18 20:07:43 UTC - permalink
Personally, I'll be defecating. Will save quite the sensory-overloading log for them. Palpably aromatic.
Comment removed from /Economics - Amplifeye - Created on 07/18/18 20:10:01 UTC - permalink
Not a fair comparison. Asian millennials are still from a demographic that was pre-selected coming to the USA from already well off families.
Thats like saying nigerian americans are better off because they are "Better". No, they come from families that are already doctors engineers and lawyers to get to the USA anyway
Comment removed from /Economics - ameriveaux - Created on 07/18/18 20:10:59 UTC - permalink
fewer
Comment removed from /Economics - MrFrode - Created on 07/18/18 20:11:28 UTC - permalink
Eliminating Medicare & Medicaid, maybe.
Comment removed from /Economics - Poguemohon - Created on 07/18/18 20:14:40 UTC - permalink
Basically this.
I’m a millennial. Born late 80s. Most people I know eat out almost every meal, go out drinking a lot, and travel internationally once or twice a year.
I think retirement is the last thing on their mind.
Most of these people don’t really understand the effects of compound interest. 6% a year ain’t no joke.
Comment removed from /Economics - deepredsky - Created on 07/18/18 20:17:43 UTC - permalink
Op trying to be racist lol
Comment removed from /Economics - edwardkirk1231 - Created on 07/18/18 20:18:07 UTC - permalink
yes good point, world population is therefore lower than 40 years ago, and our conundrum can be explained by bad boomers, not population crush
Comment removed from /Economics - pbrettb - Created on 07/18/18 20:20:19 UTC - permalink
from already well off families.
Holy shit you are clueless about the circumstance under which most Asians came to USA!
Comment removed from /Economics - whathe2016 - Created on 07/18/18 20:22:57 UTC - permalink
Educate me
Comment removed from /Economics - ameriveaux - Created on 07/18/18 20:26:51 UTC - permalink
6% is very, very easy to achieve as well. Buy an S&P fund blindly and let it ride for 6%. If you buy dips strategically, maybe you get 8 or 9%, which is the historic average for the S&P anyways.
Comment removed from /Economics - daviddavidson29 - Created on 07/18/18 20:28:36 UTC - permalink
That's a well known cognitive bias - we all think that our future self is much more virtuous and will have much more willpower (and money) to save.
Of course, fast forward 10 years, and you are still the same old you, still no money, but less time to save.
Comment removed from /Economics - bullpup1337 - Created on 07/18/18 20:29:48 UTC - permalink
No, just pointing out the fact that personal choices make a huge difference where one ends up in life.
And that it's not boomers, the rich or fill in the blank _________ scheming to impoverish millenials.
Comment removed from /Economics - whathe2016 - Created on 07/18/18 20:34:40 UTC - permalink
Yeah, but the guy above already explained how your sampling method is highly biased.
Comment removed from /Economics - edwardkirk1231 - Created on 07/18/18 20:36:43 UTC - permalink
That's what Google and Wikipedia is for.
Comment removed from /Economics - whathe2016 - Created on 07/18/18 20:39:00 UTC - permalink
Whew at least there’s that
Comment removed from /Economics - Magic_Leather_Jacket - Created on 07/18/18 20:42:03 UTC - permalink
More than one way to skin a cat
Comment removed from /Economics - Magic_Leather_Jacket - Created on 07/18/18 20:42:38 UTC - permalink
Lol no one can “buy dips strategically” repeatedly. Your overall returns will drop because your capital is underutilized (holding too much cash to wait for the dips), even if it appears your stock portfolio itself is doing 8-9%.
Comment removed from /Economics - deepredsky - Created on 07/18/18 20:44:04 UTC - permalink
Just gotta hope the boomers don't ruin the world any more than they already have before we can affect some change.
Comment removed from /Economics - wangofjenus - Created on 07/18/18 20:44:19 UTC - permalink
I've been fighting this battle since I was 22 making $40,000. I contributed from my first eligible paycheck and never stopped. I certainly do well now but I'm not making crazy money. But I'll hit $100k in retirement savings next month. I also never contributed a double digit percentage of my income.
I've been preaching for 9 working years now. Pale just don't get it. Many of my peers say "I can't afford to contribute." No you don't choose to. There's a big difference. It's pre tax money that you're getting taxed on. More importantly, it's almost always eligible to be doubled (or more) by their employer.
Comment removed from /Economics - x888x - Created on 07/18/18 20:48:41 UTC - permalink
Invest in crypto currencies now, and you’re set. When bitcoin hits a million USD, you’ll be scratching your head, or living the life.
Comment removed from /Economics - xvult - Created on 07/18/18 20:50:44 UTC - permalink
Why would anyone brag about having China's tentacles all over them? Good luck.
Comment removed from /Economics - InTheWhaleRoom - Created on 07/18/18 20:53:55 UTC - permalink
Wrong. My mother and her 6 siblings came here with less than $500 each (they were capped at that amount I believe). The 7 kids and my grandmother lived in name one room house in Taiwan. They worked hard and built their wealth. They all emphasized education in their kids. Almost all of the second gen went to good schools and made good careers.
It's a culture thing. When your family immigrates for economic opportunity, they don't easily take for granted their roots. It's not that "all Asians are good at math" as much as "Asians do math so they don't have to work in a Chinese restaurant like their first gen parents."
Comment removed from /Economics - optimus_maximus - Created on 07/18/18 20:54:59 UTC - permalink
So is this what winning feels like? Trump said we winning right?
Comment removed from /Economics - edwardkirk1231 - Created on 07/18/18 20:55:11 UTC - permalink
I sold most of my portfolio early 2017 to position myself to “buy the inevitable dip”. Instead, I missed an amazing year. I’m mostly all invested again, and who knows? Maybe now the dip comes and I get double whammied.
As they say, time in the market beats timing the market.
Comment removed from /Economics - Williale - Created on 07/18/18 20:55:43 UTC - permalink
submitted by throwittomebro to reconomics_mod_audit [link] [comments]

Bitcoin: I don’t have enemies

Bitcoin: I don’t have enemies
On January 3, 2009, Satoshi was busy from afternoon to dusk, creating, compiling and packaging the first open source code in a small server in Helsinki, Finland. After running SH A 256 operation, RIPEM D-160 operation, and writing version type, Base 58 coding, the first BLOCK of the BTC world was created at 18:15 on January 3, 2009. This day was called “Creation Day” by BTC believers, and this BLOCK is also called “Creation block." On this day, Bitcoin (hereinafter referred to as "BTC") was born. www.fmz.com
www.fmz.com
  • In the past five years, BTC has experienced a lot of things. First, it was accepted by programmers and password punks in the geek circle. In their view, BTC provided a new perspective, when the cryptographic algorithm holds the open source program as weapon running on the P2P network, this is a fantasy world like "The Matrix". They quickly accepted BTC and spread its ideas. Some programmers developed third-party applications based on source code, which is also the prototype of the current BTC industry chain. Overall, this is a very legendary start. This circle is also a pure, professional group in highly ideal color. There is no power to roll, no money to chase, no speculation, and everything is only related to technology and hobbies. So, that programmer who bought a $25 pizza with 10,000 BTC in 2010 was asked if he regretted it. He replied: Pizza is delicious.
  • But then, all of this changed slowly. In July 2010, the Mt. Gox platform was established. People in the gray economic circle began to move toward the “Silk Road”; in November of the same year, the price of BTC reached 0.5 US dollars and the BTC economy reached 1 million, which attracted the attention of the profit-seekers; in April 2011, the well-known American financial magazine "Times" and "Forbes" published reports on BTC one by one. www.fmz.com
www.fmz.com
  • Humanistic technologists become interested; on December 6, 2012, the first officially recognized bitcoin exchange was born in France, and the visionary government began to think... Since 2013, as the market value has risen rapidly, the debate has become more and more fierce. Former US Federal Reserve Chairman Alan Greenspan said that BTC is a bubble with no intrinsic value. Nobel economist Krugman called BTC a historical retrogression. Whether it is in politics, economics, sociology, or even science, there are strong opposition voice.
  • No matter how many people are hostile to Bitcoin, the answer given in the book Bitcoin is: I have no enemies - I am just an open source program, a cryptographic algorithm, a new technology, a P2P electronic payment system, a good idea... Although the liberals in the technical world will give me great ideals, the anarchists in geeks even regard me as a modern belief, I just want to solve practical problems through technology and make human feel convenient in actual interaction. In 2011, he began to contact BTC. Chang Jia, the author with genius mathematical thinking, who stepped into BTC world in 2011, said that for liberals, Bitcoin is Noah’s Ark, which can carry them to a free paradise; for the Silk Road, Bitcoin is snow job; for organizations like the Bitcoin Foundation, the Bitcoin community needs to actively engage with regulators to avoid potential policy reefs. www.fmz.com
  • The book "Bitcoin" is mainly about "I am solving problems, not making trouble": For the government, BTC is not an enemy. As long as the nation-state still exists, the legal currency will exist; as long as the government itself respects the marketization of the legal currency, then BTC can only become a supplement. For financial capital, large financial companies such as Visa, MasterCard, and Morgan can learn from the BTC's moveable value mechanism and parasitize on the BTC node. In a further step, they can introduce third-party agreements from banks, which can promote modern finance to a full Information height. For the economics community, many economists, especially Keynesianism, feel that BTC subverts traditional economic theory, natural deflationary attributes will only encourage speculation and ignore value, but in fact BTC will eventually belong to the essence value holders and the whole society. For the media, BTC not only provides free faith, but also provides an economic self-reliance. BTC and media are inherently natural alliances. For individuals, BTC is not an enemy. Money indiscriminate causes inflation to exploit people's wealth all the time. BTC offers the possibility of additional wealth preservation. At the very least, because BTC competes with fiats, the central bank will not be too unscrupulous.
www.fmz.com
  • In the future, the BTC world should pay more attention to the time stamp service and integrate more information into the encryption protocol not just currency; design a BTC third-party protocol access mechanism to complement and intersect with more traditional industries; strengthen decentralized Dropbox and its other extensible services. The core idea of ​​Bitcoin is not to misunderstand the emergence of BTC, which is just to make human life better, like the Internet. The Internet doesn’t have enemies, nor does BTC. www.fmz.com
submitted by FmzQuant to u/FmzQuant [link] [comments]

Bitcoin or Bust?

THE recent surge in the price of Bitcoins has created an unprecedented wave of interest in the cryptocurrency. Once the domain of computer geeks and speculative investors, the meteoric rise in the price has forced Bitcoin into the public spotlight and it has become the hot topic of debate around the water coolers as well as in the bars, restaurants and hair salons.
Some dismiss it as a passing fad, a bubble waiting to burst and an elaborate Ponzi scheme, while others claim it the greatest innovation since the internet, the currency of the future and a great way to make quick money. Who is right and who is wrong?
Bitcoins are traded on a number of exchanges around the world and, as with any other market, whether it is oil, wheat futures, share options or the price of bagels in downtown Manhattan, the price is determined by supply and demand.
Some investment gurus such as Warren Buffett believe the hockey stick shape of the Bitcoin price cannot be explained by traditional supply and demand dynamics. The meteoric rise in the Bitcoin price has been caused by an investment frenzy triggered by the hype surrounding the cryptocurrency concept which has gripped the imagination of the public.
It has all the hallmarks of a speculative bubble which they believe could burst at any moment. An investment bubble occurs when the price of a commodity rises way beyond the intrinsic value of the item. The sudden rise in price creates a lot of publicity and tales of instant wealth and overnight millionaires lure new investors into the market.
As the price continues to rise, the fear of missing out (the Fomo factor) attracts even more investors, driving prices up further. The cycle repeats itself until the price reaches a tipping point and the market collapses overnight. There have been a number of well documented examples in the past, from the Tulip Mania that gripped the Dutch in the 17th Century to the tech boom in the late 1990s, the housing crash of 2006 and the commodities bust in 2009.
During the tech boom in the 1990s, for example, the share prices of web-based businesses reached astronomical proportions. Gripped by what the US Federal Reserve Board chairperson at the time, Alan Greenspan, called “irrational exuberance”, seasoned investors and regular consumers clambered to get a piece of the action and make a quick buck.
At the time, nobody really understood what the internet was, let alone what its long-term implications were, but this did not deter people from selling the proverbial farm and buying tech stocks at almost any price. As share prices soared, some of the most obscure, and often unprofitable, internet based companies had market capitalizations in the millions and sometimes billions of dollars.
Despite some spectacular failures and the poor financial results published by those who managed to survive for longer than a year, the investment frenzy continued unabated. In early 2000, however, the market seemed to come to its senses. Prices began to decline and then started plummeting as panic swept through the market. The tech market eventually collapsed, leaving many investors penniless and the world economy in a recession.
A number of investment gurus see many similarities between the tech boom and bust of the ’90s and the Bitcoin market at the moment.
At the current price level, Bitcoin has a market capitalization of over $200 billion, which is $70bn more than the value of General Electric and greater than the gross domestic product of some countries.
As Buffett put it in 2014: “The idea that (Bitcoin) has some huge intrinsic value is just a joke in my view. Bitcoin is not backed by a company’s earnings or the strength of a government and rule of law. There’s also no interest or dividends.”
At the time Bitcoin was priced at about $600 and is now trading above $14 000, but he is sticking to his guns and in October 2017 stated that Bitcoin “is a real bubble”.
On the other side of the argument, there are those who believe that the internet and social media have created a new mindset in modern society which makes the concept of a global currency that cannot be controlled by any government an alluring concept that has caught the imagination of the public.
Anyone who owns Bitcoin achieves a degree of economic freedom which was not possible before. They can send value across the world without having to ask for permission from a bank or government body and Bitcoin cannot be taxed, controlled, destroyed or confiscated.
A central bank cannot print more Bitcoins to control the money supply and manipulate the price either. It is free from global recessions, government financial mismanagement and unfair taxpayer-funded bailouts.
This utopian view of an international currency free of interference by big government is the primary reason for the high value placed on Bitcoin by the public. Demand is being driven not by traditional investors, but by a wave of internet-savvy pundits who believe that Bitcoin will become the de facto method of payment in the future. In a digital age we need a digital currency and the current price, they claim, reflects the future expectations of the market. The high prices are not a reflection of Bitcoin’s current value, they say, but rather its potential value. Another factor driving up the Bitcoin price is the expectation that big financial players are set to wade into the market. The Chicago Mercantile Exchange (CME) recently introduced Bitcoin derivatives – a bet on the future value of the currency – which allows hedge funds to enter the market.
Some speculate that big players such as JP Morgan, Goldman Sachs and Merrill Lynch could enter the market in 2018 and offer Bitcoin as part of a high-risk portfolio to clients. Once the large investment houses start buying Bitcoins, demand will skyrocket and the price will rise to even greater heights.
If Bitcoin fulfils its original purpose and becomes the medium of exchange on the internet and is accepted in more brick and mortar stores, the demand will rise even further. Bitcoin enthusiasts believe it is likely to fulfil that role and the high Bitcoin price indicates the market agrees.
The Bitcoin market, however, is still in its infancy and is extremely volatile as widely differing opinions about its future cause the price to fluctuate wildly.
Those who got in early are making huge returns on their investment and it may be tempting to jump on the bandwagon and get a slice of the action, but Bitcoin should still be considered a risky investment.
Some say Bitcoin is a solution looking for a problem. It could become the next global payment system, but it could just as easily fail or fall away. It would be wise to adopt a rational and cautious approach and as with any prudent investment strategy – only invest as much as you are willing to lose.
THREATS & CHALLENGES
BITCOIN faces a number of challenges which detractors believe could reduce demand in the short term and threaten its existence in the long term:
Rising prices
Ironically, Bitcoin’s is its own worst enemy. Rapidly rising prices are not a desirable feature of a currency. If someone believes the Bitcoin price is likely to rise and will be worth more in the future, they would be reluctant to spend it on something now. Its success undermines its usefulness. Some analysts believe that market volatility and continually rising prices will prevent Bitcoin from fulfilling its purpose as a global payment system.
Security
The blockchain itself is considered totally secure and virtually hack-proof. It has withstood intense scrutiny by mathematical and computer experts and to date there haven’t been attacks on the blockchain itself that has led to money being stolen.
Bitcoin’s biggest vulnerability is the integrity and security of the exchanges and wallet programs that store Bitcoins on behalf of users. Some have gone bust while others have suffered cyber-attacks in which hackers have made off with huge sums.
Further reports of successful cyber heists could shake investors’ confidence in the cryptocurrency, causing a sell-off and a sharp decline in its price.
Speed
The blockchain is spread over thousands of computers globally, which compete with each other to verify transactions. Although this is at the core of its security, it is a highly inefficient system and means Bitcoin can only process a handful of transactions a second.
Centralised payment processors, like Visa, process thousands of transactions a second, which makes it more attractive to large retailers as a payment system. Amazon, for example, processed 600 transactions a second during last year’s Amazon prime sale.
If even a fraction of their traffic decided to pay with cryptocurrency, consumers would be stuck for hours waiting for their transactions to be processed.
Rival coins
There are other cryptocurrencies already on the market which are a lot faster. Ripple, for example, can process 1500 transactions a second.
Bitcoin wields first-mover advantage, accounting for about 61% of the cryptocurrencies, but there is nothing to prevent any of the alternative coins from usurping Bitcoin.
Amazon is an innovative tech giant with huge clout in the internet industry and there are rumours they are looking into developing their own cryptocurrency, which could provide a serious challenge to Bitcoin.
Power consumption
Some experts believe an environmental crisis is looming if Bitcoin continues on its current trajectory. The complex computer algorithms that underpin Bitcoin require huge data centres that guzzle power. One observer predicts that without a significant change in how transactions are processed, Bitcoin could be consuming enough electricity to power the US by the middle of 2019. Six months later, that demand could equal the entire world’s power consumption.
Over-regulation
Many countries worldwide are investigating Bitcoin and starting to recognise it as a realistic threat. Controlling the money supply is a vital economic and political lever which governments are reluctant to abdicate to a cryptocurrency.
Its anonymity and lack of central control, however, makes it difficult to control and it seems that in the short term their only course of action is to regulate it out of existence.
China recently clamped down on cryptocurrency exchanges and Russia has been openly talking about the prospect of creating its own state-controlled cryptocurrency.
submitted by Furburger1 to Bitcoin [link] [comments]

[uncensored-r/Bitcoin] Bitcoin or Bust?

The following post by Furburger1 is being replicated because some comments within the post(but not the post itself) have been silently removed.
The original post can be found(in censored form) at this link:
np.reddit.com/ Bitcoin/comments/7qdi7n
The original post's content was as follows:
THE recent surge in the price of Bitcoins has created an unprecedented wave of interest in the cryptocurrency. Once the domain of computer geeks and speculative investors, the meteoric rise in the price has forced Bitcoin into the public spotlight and it has become the hot topic of debate around the water coolers as well as in the bars, restaurants and hair salons.
Some dismiss it as a passing fad, a bubble waiting to burst and an elaborate Ponzi scheme, while others claim it the greatest innovation since the internet, the currency of the future and a great way to make quick money. Who is right and who is wrong?
Bitcoins are traded on a number of exchanges around the world and, as with any other market, whether it is oil, wheat futures, share options or the price of bagels in downtown Manhattan, the price is determined by supply and demand.
Some investment gurus such as Warren Buffett believe the hockey stick shape of the Bitcoin price cannot be explained by traditional supply and demand dynamics. The meteoric rise in the Bitcoin price has been caused by an investment frenzy triggered by the hype surrounding the cryptocurrency concept which has gripped the imagination of the public.
It has all the hallmarks of a speculative bubble which they believe could burst at any moment. An investment bubble occurs when the price of a commodity rises way beyond the intrinsic value of the item. The sudden rise in price creates a lot of publicity and tales of instant wealth and overnight millionaires lure new investors into the market.
As the price continues to rise, the fear of missing out (the Fomo factor) attracts even more investors, driving prices up further. The cycle repeats itself until the price reaches a tipping point and the market collapses overnight. There have been a number of well documented examples in the past, from the Tulip Mania that gripped the Dutch in the 17th Century to the tech boom in the late 1990s, the housing crash of 2006 and the commodities bust in 2009.
During the tech boom in the 1990s, for example, the share prices of web-based businesses reached astronomical proportions. Gripped by what the US Federal Reserve Board chairperson at the time, Alan Greenspan, called “irrational exuberance”, seasoned investors and regular consumers clambered to get a piece of the action and make a quick buck.
At the time, nobody really understood what the internet was, let alone what its long-term implications were, but this did not deter people from selling the proverbial farm and buying tech stocks at almost any price. As share prices soared, some of the most obscure, and often unprofitable, internet based companies had market capitalizations in the millions and sometimes billions of dollars.
Despite some spectacular failures and the poor financial results published by those who managed to survive for longer than a year, the investment frenzy continued unabated. In early 2000, however, the market seemed to come to its senses. Prices began to decline and then started plummeting as panic swept through the market. The tech market eventually collapsed, leaving many investors penniless and the world economy in a recession.
A number of investment gurus see many similarities between the tech boom and bust of the ’90s and the Bitcoin market at the moment.
At the current price level, Bitcoin has a market capitalization of over $200 billion, which is $70bn more than the value of General Electric and greater than the gross domestic product of some countries.
As Buffett put it in 2014: “The idea that (Bitcoin) has some huge intrinsic value is just a joke in my view. Bitcoin is not backed by a company’s earnings or the strength of a government and rule of law. There’s also no interest or dividends.”
At the time Bitcoin was priced at about $600 and is now trading above $14 000, but he is sticking to his guns and in October 2017 stated that Bitcoin “is a real bubble”.
On the other side of the argument, there are those who believe that the internet and social media have created a new mindset in modern society which makes the concept of a global currency that cannot be controlled by any government an alluring concept that has caught the imagination of the public.
Anyone who owns Bitcoin achieves a degree of economic freedom which was not possible before. They can send value across the world without having to ask for permission from a bank or government body and Bitcoin cannot be taxed, controlled, destroyed or confiscated.
A central bank cannot print more Bitcoins to control the money supply and manipulate the price either. It is free from global recessions, government financial mismanagement and unfair taxpayer-funded bailouts.
This utopian view of an international currency free of interference by big government is the primary reason for the high value placed on Bitcoin by the public. Demand is being driven not by traditional investors, but by a wave of internet-savvy pundits who believe that Bitcoin will become the de facto method of payment in the future. In a digital age we need a digital currency and the current price, they claim, reflects the future expectations of the market. The high prices are not a reflection of Bitcoin’s current value, they say, but rather its potential value. Another factor driving up the Bitcoin price is the expectation that big financial players are set to wade into the market. The Chicago Mercantile Exchange (CME) recently introduced Bitcoin derivatives – a bet on the future value of the currency – which allows hedge funds to enter the market.
Some speculate that big players such as JP Morgan, Goldman Sachs and Merrill Lynch could enter the market in 2018 and offer Bitcoin as part of a high-risk portfolio to clients. Once the large investment houses start buying Bitcoins, demand will skyrocket and the price will rise to even greater heights.
If Bitcoin fulfils its original purpose and becomes the medium of exchange on the internet and is accepted in more brick and mortar stores, the demand will rise even further. Bitcoin enthusiasts believe it is likely to fulfil that role and the high Bitcoin price indicates the market agrees.
The Bitcoin market, however, is still in its infancy and is extremely volatile as widely differing opinions about its future cause the price to fluctuate wildly.
Those who got in early are making huge returns on their investment and it may be tempting to jump on the bandwagon and get a slice of the action, but Bitcoin should still be considered a risky investment.
Some say Bitcoin is a solution looking for a problem. It could become the next global payment system, but it could just as easily fail or fall away. It would be wise to adopt a rational and cautious approach and as with any prudent investment strategy – only invest as much as you are willing to lose.
THREATS & CHALLENGES
BITCOIN faces a number of challenges which detractors believe could reduce demand in the short term and threaten its existence in the long term:
Rising prices
Ironically, Bitcoin’s is its own worst enemy. Rapidly rising prices are not a desirable feature of a currency. If someone believes the Bitcoin price is likely to rise and will be worth more in the future, they would be reluctant to spend it on something now. Its success undermines its usefulness. Some analysts believe that market volatility and continually rising prices will prevent Bitcoin from fulfilling its purpose as a global payment system.
Security
The blockchain itself is considered totally secure and virtually hack-proof. It has withstood intense scrutiny by mathematical and computer experts and to date there haven’t been attacks on the blockchain itself that has led to money being stolen.
Bitcoin’s biggest vulnerability is the integrity and security of the exchanges and wallet programs that store Bitcoins on behalf of users. Some have gone bust while others have suffered cyber-attacks in which hackers have made off with huge sums.
Further reports of successful cyber heists could shake investors’ confidence in the cryptocurrency, causing a sell-off and a sharp decline in its price.
Speed
The blockchain is spread over thousands of computers globally, which compete with each other to verify transactions. Although this is at the core of its security, it is a highly inefficient system and means Bitcoin can only process a handful of transactions a second.
Centralised payment processors, like Visa, process thousands of transactions a second, which makes it more attractive to large retailers as a payment system. Amazon, for example, processed 600 transactions a second during last year’s Amazon prime sale.
If even a fraction of their traffic decided to pay with cryptocurrency, consumers would be stuck for hours waiting for their transactions to be processed.
Rival coins
There are other cryptocurrencies already on the market which are a lot faster. Ripple, for example, can process 1500 transactions a second.
Bitcoin wields first-mover advantage, accounting for about 61% of the cryptocurrencies, but there is nothing to prevent any of the alternative coins from usurping Bitcoin.
Amazon is an innovative tech giant with huge clout in the internet industry and there are rumours they are looking into developing their own cryptocurrency, which could provide a serious challenge to Bitcoin.
Power consumption
Some experts believe an environmental crisis is looming if Bitcoin continues on its c...
submitted by censorship_notifier to noncensored_bitcoin [link] [comments]

Some of my big concerns with bitcoin in the wake of Silk Road, from an experienced real world trader fairly new to the bitcoin concept.

There are many things about this I could go into after commenting, studying, reading, and thinking much about bitcoin and silk road today (after hearing about it some time ago).
Few thoughts:
I think a lot of the technology & cryptography geniuses (not being sarcastic) involved in bitcoin and various spinoff ideas need to study markets, trading, fiscal policy and currency in depth. Especially the history of trading. See a book called "Extraordinary Popular Delusions & The Madness Of Crowds", among others, for example. See the internet bubble late 90s/early 2000s. See the Mortgage crisis, where risky mortgages were packaged as safe ones. Many many examples throughout history going back to the invention of money. The many flaws in the current bitcoin system are fairly clear to me as an experienced trader in the "real world".
One main red flag thing to look into is "how easily can I cash out my bitcoin holdings for real US/Euro/Pound currency if I need/want to." Seems extremely illiquid on the cashing out side (similar to how some sports betting and poker sites have been in the past). A true "run on the bank" would cause immediate panic and market shutdown -- look at the what the "flash crash" did today to the infrastructure of the bitcoin market, not to mention the prices. And a lot of "banks" would disappear into the night, not redeeming/cashing out.

2 Was there ever a currency, commodity or anything else that was issued with a strict calendar time limit of when they would stop producing it? That inherently promotes hoarding and artificially boosts the value. Why would you spend the currency on goods instead of saving/investing it, if the supply is limited and will eventually stop (because it is then destined to be in shortage). The only place really worth spending it is illegal markets that don't accept credit cards and established currency. It likely will collapse on its own weight, otherwise 1 bitcoin would end up equaling $1 million or $1 billion or more (good luck cashing that out for real legal goods or an accepted currency). Talk about inflation. It actually reminds me more of a global electronic version of Beanie Babies and baseball cards that were issued in strict limited edition amounts - not a currency. You could perhaps compare it to diamonds (rather then gold), where a couple of producers attempt to strictly limit the supply each year in order to (in my view) artificially maintain high prices) -- but diamonds are a beautiful rare gem (and a real thing) that has held value over time (and women like them, they are sparkly).

3 Despite the bells and whistles of the various entrepeneurial websites, the regulations and rules that make for organized stock/bond/currency markets around the world are not present at all in the bitcoin "market". Among other things, there are no put options available to bet on downside, no short selling, no margin, no interest rate on holdings (that might be a good thing) ... but the biggest problem is no liquidity, oversight and established legitimate places of trade. Hence why "exchanges" and websites go belly up, are fraudulent, get hacked, have 7 day delays when the market gets busy, etc. There are prices 10%, 20% different on different websites at the same time ... not to mention the massive (and probably hidden) buy/sell spread price these "exchanges" are charging. In modern world liquid markets trading, any real arbitrage is usually immediately closed for example.

There's much more I could pick apart in it, but I'm tired. Bottom line is that currently bitcoin is a wild west hacker's and scammer's paradise and buyer beware (if you ever want to cash out). Creating a virtual mountain of virtual gold out of thin air that is pre-determined to be "tapped out" of gold in 40 years (or whenever) sounds like the Wizard of Oz to me.
If you want to appoint me as the Jessie Livermore / Alan Greenspan / SEC Commissioner / Warren Buffett / Goldman Sachs of the bitcoin world, I would consider it, but payment only in real world currency :D
submitted by rufusjonz to Bitcoin [link] [comments]

[Table] IAmA: I am former SEC Chairman Arthur Levitt. I am here with Motif Investing CEO Hardeep Walia. We would love to discuss Wall Street, financial regulation and disruptive financial technology. Ask us anything!

Verified? (This bot cannot verify AMAs just yet)
Date: 2015-05-01
Link to submission (Has self-text)
Questions Answers
Certain people have postulated that the abundance of outstanding student loan debt could be the next "bubble to burst" potentially causing financial turmoil in the future, do you think this will be the case? Arthur...I'm not certain what the next bubble will be or what will cause it. I am certain that there will be a bubble because that's the nature of our economy. There are no perfect cures and I wish the small investor was not the first to get hurt. But ultimately we must each protect ourselves by investing knowledgably not emotionally and buying low expense ratio funds rather than individual stocks.
Hardeep: I am worried about student loans. From a financial perspective and a personal perspective.
I wrote a piece on Forbes on the topic.
Here it is: Link to www.forbes.com
How has the financial – tech / financial start-up space evolved since your early days at Shearson/Shearson Lehmann Brothers/Smith Barney Shearson to today? Arthur...It sure has. I feel so fortunate to be advising seven hi tech companies in different parts of America and in different technologies. Today it's a large part of the American economy rather than the back water business it was in the 70's. The number of success stories are greater than just Apple and Microsoft and they span the whole gamut of American enterprise. What a difference! In the Sheraton days it was Tech Aerofoam (retirement) and Topper (toys)
How can a lower to middle class person navigate the intricacies of the financial market (to earn for retirement by investing) without devoting their lives to the process? Also, do you see the financial sector as over regulated, under regulated, or just right? Arthur...No I do not believe that the financial sector is over regulated. It's based on full disclosure and that's the best way to protect investors. But nothing is better for investors than being certain they know what they are doing and put emotionalism aside. Remember that most individuals are better off investing in passive, low price ration funds than picking stocks. I am dead set against stock picking except for the most experienced investors.
Does Motif have plans to trade on international (non-US) exchanges? What I mean: will it be possible (eventually) to include stocks in my Motif that are only traded on these non-US exchanges? There are many solar stocks for example that are traded in HK exchange only. We are starting opening up Motif to international residents by late summer i am hoping. it depends on international regulators.
Opening up international markets to US residents will depend on how the first phase goes. Hopefully next year in specific markets.
Right now markets on our first wave are Hong Kong, UK and Australia.
You can invest in international markets through US listed international stocks and ETFs.
Thanks for doing this AMA. What's your biggest regret during your time as SEC chairman, what was the one thing that you wish you had done differently or wanted to do but couldn't to shape or change the financial community? Arthur...What a great question and what an easy answer. I greatly regret not supporting Brooksley Borne (Chairman of the CFTC) when, in the President's working group she called for regulating derivatives. I was persuaded by the Secty of the Treasury and Alan Greenspan that this was a very disruptive step. I should have held my ground and called for the regulation that is just being rolled out sixteen years too late.
Arthur, Hardeep, Which stock has been your best investment ever? Which motif right now are you personally most bullish on? Arthur...Probably the best investment I ever made was in the stock of the M& T Bank corporation which has one of the best managers in American business. I like "On the Road" and "Vice"
Hardeep: Rising Interest Rates and Sharebuybacks.
Compliance: this does not constitute advice please consult your financial advisor.
What exactly caused the financial melt down 07-08? Lots of people have lots of responses and no one I believe is absolutely certain. Clearly our markets were out of kilter. Expectations were ridiculous and banks were lending to much to too many. Personally I believe the change from Glass Steagall played a real role . This is Arthur.
When do you plan on supporting trading securities like bonds (not bond ETFs) and mutual funds on Motif Investing? Thanks. We just received permission to do mutual funds from FINRA.
Honestly i am not a big fan of mutual funds but our customers have been asking for them so we are looking into right now.
Bonds will come later--we need to do this. We need some scale here to be competitive. Lots of opportunity here.
Which way do you think the supreme court will judge on expensive mutual funds and employee accounts? I think so much innovation is needed in 401K space. Something i am personally very passionate about.
I am hoping the Supreme Court rules in favor of the employees. It will shake up the industry and make it even easier for motif to play in this space. I am watching closely.
Arthur, Hardeep, which is your favourite book to learn about investing? Whats your biggest personal learning in investing? Unconventional Success by Dave Swensen.
He was my professor Yale and i did my senior thesis with him.
Brilliant investor and more importantly a brilliant human being.
ARTHUR...My Book Take on the Street.
That too... :) Hardeep.
Motif Investing is truly evolutionary from all other online brokerages. It has been a financially disruptive technology. How are you going to make Motif Investing revolutionary? We spent most of last year migrating our system to BNY's Pershing platform. It put is in a great position to scale in the US and globally. But it did slow down our product/feature launches.
You will start to see some revolutionary products launched in the next few months. Stay tuned...
Between your public sector / publicly traded private sector and start-up lives – which one (if you had to choose one) did you enjoy the most? Arthur...I must say my public sector life and my high tech lives have brought me the most professional satisfaction. In both these areas I find that I am able to make a difference.In fairness I must say that over 60% of my life has been luck not genius. Probably true of all of us.
What steps is Motif taking for financial and investing education so that more people invest in an informed way understanding the risks and rewards? We are going to be launching an investor education center this summer.
We are also going to be launching new products to help investors understand risk.
For all our motifs, we measure relative valuation and volatility.
We need to better here. thanks.
Where can i get more info on the investor education center and the new products? I am a trader / trainer and passionate about financial education and would like to contribute in any way I can. Shoot me mail. or tweet me. hardeep.
We are already licensing our platform to teach 6-th graders investing for free.
Do you plan on providing support in Motif Investing for automatic dividend reinvestment? Hardeep: Yes--we are working on it.
We have to solve the automated handling of corporate actions first. That is a REALLY hard problem.
We are very close to completing this. Dividend reinvestment is next.
Thanks for doing this AMA Arthur, really appreciate it! I enjoy following your twitter account and listening to your podcast, you have some fantastic economic insight. I was pleased to hear that you're bringing your expertise to the Bitcoin space as I believe your traditional finance background can help Bitcoin reach its enormous potential. I'm interested to know where you think Bitcoin will be in 5 years time? Arthur. Thank you. I really love doing radio. As for the Bitcoin space. Its clearly here as an important vehicle. Cryptocurrency in some form or other is going to evolve . Im not certain whether it will be bitcoin as it is now or some evolutionary form but the banks are now buying in and international needs are growing. I am a strong supporter of bitcoin.
The rise to prominence of mortgage-backed securities obviously led to a vast crisis in the financial community for a variety of reasons. What do you see as the next financial instrument to pose such potential danger, in regards to lack of regulation and otherwise? Arthur. It's hard to tell which product or group of products will contribute to the next meltdown. I have a feeling that b to B lending will play a role. Too many people are looking a lending as the open sesame to riches. This is important but we must be careful. This is Arthur.
What is your take on high frequency trading and some of the 'gaming the system' that comes along with it? Do you have an opinion on the future of where HFT will go? Thanks. I believe that High Frequency trading is going to be quite different in several years Probably because of regulation and part because of changes in technology. There will be a new game. Arthur.
Of all the innovative companies out there why did you pick Motiff? The major reason I agreed to advise and then serve on the board of Motif was because of the quality of the founder. His persistence made all the difference to me.
Hardeep, was it hard to find the 1st round investors for Motif? Hardeep: We got super lucky. Took us about five weeks end to end.
Stressful but wasn't as hard as i thought.
Subsequent rounds are easier than your first.
You do a lot of charity work. How do you pick the causes you support? Arthur...Again...its based on what I perceive to be the need as well as my personal interests and whether the work or funds I devote are used efficiently.
Respectfully, how much does Robinhood (new, fee-free stock trading brokerage) pose serious competition to Motif Investing? Hardeep: I am always paranoid about competition.
I have seen us under-estimate competition too much at Microsoft.
Stay tuned. Lots of new products about to launch.
Last updated: 2015-05-05 20:35 UTC
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