That supposes that everyone acknowledges that it was irrational at the point of that crash. If there are still believers...and then add people making a lot of money pumping it.
Key Post Bitcoin is a clearly identifiable economic bubble
- Thread starter Brendan Burgess
- Start date
That supposes that everyone acknowledges that it was irrational at the point of that crash. If there are still believers...and then add people making a lot of money pumping it.
Very few bubbles burst only once. As I said, for a bag of hot air to collapse completely, everyone must be convinced it's a bag of hot air. What history are you referring to in this context?
What makes a bag of hot air, a bag of hot air? I would suggest that the underlying premise upon which its value is based has been found out to be faulty, wholly inaccurate, misleading and or fraudulent. Thus heralding a price collapse to zero (or next to zero). This is what makes it a bag of hot air.
This is distinct from, say a property crash, or a stock crash, where the asset has inherent value but that value has been way over-priced, heralding a price crash but over time a price recovery.
Bitcoin is not acting like a bag of hot air. It has repeatedly crashed, only to recover stronger - with the exception that todays value has only recovered 60%+ off its peak valuation, so far.
This is not acting like a bag of hot air, wouldn't you agree?
If bitcoin price was mostly down to 'people making a lot of money pumping it' then it is hard to see how it has survived this long when such pump and dump schemes, once exposed, tend to crash.
And in much the same case you are basing the intrinsic value of Bitcoin on how traditional assets are valued, but if you look across the span of time Bitcoin is no different to dollars, gold, shares, shells.
Explain to me why gold has any intrinsic value?
It is because the collective people believe it has a value.
Let's not deflect yet again, please point to the historical events you were referring to.
There is no deflection Leo, as can be seen below I merely alluding to the fact that bitcoin price is acting in a manner that does not resemble the price action of 'a bag of hot air' when such a bag has been found out to be faulty, misleading, wholly inaccurate and/or fraudulent etc.
But out of courtesy to you, the historical events I was referring to is the entire global financial and economic history. Lets go with the tried and tested tulipmania if you care, or Anglo shares, Enron, or other...take your pick.
So Tulips are now worth nothing? Did their price ever go to zero after that bubble burst? Enron and Anglo never had any value other and were always worth zero? The latter two were victims of spectacular mismanagement, they were never just bags of hot is as you suggest.
So, any more examples?
*sigh*....
To be more exact....if bitcoin goes to €0.01, we can say that is still has value, but has gone to zero (or next to zero) relative to its peak price.
Why would you even say that? Of course they had value. But once the premise of that value was found out to be based on nothing more that misleading and/or fraudulent information/accounting/management (whatever you want to call it), that value transformed quickly into a bag of hot air and subsequent price crashes that never recovered.
You can surely admit that bitcoin price has not suffered the same? Thus questioning the assertion that it is a 'bag of hot air'.
If you cant admit that, then good day!
I think you're reading a lot more into what I said again.
You mentioned historical bag of air events, I asked you what events you were referring to and you replied with Tulips, Enron and Anglo. So why did you mention them? And if not these, can you clarify what events you referred to?
You ask to mention some events, so I obliged? You then inferred that I implied Anglo, Enron, never had any value. I never said any such thing. That would be like you saying bitcoin has no value nor ever had, that it is a bag of hot air. When clearly the evidence is right in front of your face that bitcoin does have value is that value is currently priced by markets at around €11,000.
That doesn't mean to say it will never return to zero, that doesn't mean that in the future some underlying factor will not emerge that will expose bitcoin as faulty, misleading, fraudulent etc. But clearly to date, it has not.
That is the question I have been asking. I'm of the view that a bag of hot air will ultimately return to zero, perhaps I have been mistaken?
Bitcoin, despite is price crashes has not returned to zero. Instead it is increasing in price once more. I'm asking, what bag of hot air throughout financial and economic history lost 80%+ of its value only for it to subsequently returned 400%+? I cant think of an instance throughout history, can you?
Some I'm minded to think that bitcoin is not a bag of hot air, aren't you?
No, you said:
So let's try and stick to your history of bags of hot air. What events were you referring to?
The entire financial and economic history of the world.
Am I missing something? I take a "bag of hot air" as a euphemism for something that is inherently worthless. Im thinking you are taking it literally?
No, lets stick with the question I posed before you interjected.
That is, no "bag of hot air" (euphemism for something worthless) has crashed in price and subsequently recovered time and time again like the "bag of hot air" that bitcoin is?
For this bag of hot air, it would appear that this time is truly different?
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So what specific bags of air are you talking about?
Duke of Marmalade
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Oh great! Angels dancing on pins time again
I am a committed subscriber to the BOHA school, having learnt most of what I know about bitcoin on this site. I am also grateful to this site for encouraging me to short btc at 14,500 and subsequently close out at just over 8,000. But I stand ejected, I could never, ever have predicted this Lazarus type bounce back
So whilst I still firmly believe in BOHA I am very reluctant to short again. Wolfie argues that btc has now demonstrated that it has "inherent" value because its price stubbornly refuses to go to its true worth (new word) of zero. So inherent value equals price in this argument. That of course then becomes circular and non contestable. But looking for a more meaningful definition of inherent value we have that arch NBOHA tecate's definition
But, to repeat old arguments, I humbly maintain that it is not this "inherent value" that decides the price, for how could inherent value be so wildly volatile. No, the price is 99.9% driven by speculation. This Lazarus act will probably serve to sustain btc for quite some time. Next time it falls to 3,000 there will be enough takers to remind us of the last time and once the bandwagon gets on a roll, well we see that indeed the price can come storming back. I see now that whilst I was right in my BOHA faith I was probably lucky in my little bet against btc.
I am a committed subscriber to the BOHA school, having learnt most of what I know about bitcoin on this site. I am also grateful to this site for encouraging me to short btc at 14,500 and subsequently close out at just over 8,000. But I stand ejected, I could never, ever have predicted this Lazarus type bounce back
So whilst I still firmly believe in BOHA I am very reluctant to short again. Wolfie argues that btc has now demonstrated that it has "inherent" value because its price stubbornly refuses to go to its true worth (new word) of zero. So inherent value equals price in this argument. That of course then becomes circular and non contestable. But looking for a more meaningful definition of inherent value we have that arch NBOHA tecate's definition
Whilst this does not float my boat (no more than frog's legs) I have to accept that there appears to be a demand for that kinda thing, albeit the supply of btc lookalikes is in the thousands.tecate said:
But, to repeat old arguments, I humbly maintain that it is not this "inherent value" that decides the price, for how could inherent value be so wildly volatile. No, the price is 99.9% driven by speculation. This Lazarus act will probably serve to sustain btc for quite some time. Next time it falls to 3,000 there will be enough takers to remind us of the last time and once the bandwagon gets on a roll, well we see that indeed the price can come storming back. I see now that whilst I was right in my BOHA faith I was probably lucky in my little bet against btc.
To answer the first question:
Yes, I don't think Tulips ever hit zero, and they currently cost more than zero.
It's an interesting question. As Duke has suggested, which I think most would agree, the surge in price is driven by speculation. If not, what's behind the sudden increase in its price? Has there been any reported sudden increase in the usage of BTC to actually buy stuff????
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