Not relevant in a thread that discusses a digital gold use case. That aside, it was discussed to death in the other thread. It boils down to your view Firefly that if bitcoin is not used as a means of exchange this very day, then it's toast. I don't agree - but everyone can make up their own minds.Would it be too much to expect that someone might use this "currency" to, you know, actually buy something?
bitcoin has proven to be much easier to liquidate than stocks, bonds, real estate and gold as it trades 24/7 - 365.
In the context of the market events over the last couple of days I wouldn't have thought it irrelevant.Sure, I can cash my Bitcoin when the market of the other is closed, but that is irrelevant.
That's a heroic effort Wolfie. However, whilst it might explain why it is not acting as digital gold, it does not explain why it is crashing. tecate has suggested some technical reasons, like folk meeting margin calls. I am not convinced. Could it be that Bitcoin has joined the establishment - if the Dow and FTSE are being dumped so too is Bitcoin.My two Satoshi worth.
The reason why bitcoin is crashing now, and not chasing all times highs is that this stock market crash is not (yet) a consequence of financial malpractice and fraud as was the crash of 2007/8. It was out of the property loans, sub-prime mortgages, credit default swap, collateralized debt obligations gambling frenzy that resulted in the 'credit crunch' and subsequent financial collapse.
The consequences were devastating - job losses, homelessness, bankruptcies etc.
One other consequence of the financial collapse was the creation of bitcoin, a trustless peer to peer system to carry out financial transactions or transfers with in built scarcity.
It is not a panacea to protect wealth against biological pandemics that threaten to destabilize world economic output. If the world were to go into economic lockdown, Wuhan style, then the value of everything is vulnerable, including bitcoin.
Where the value of bitcoin may come into its own is how governments around the world react (the magic money trees are starting to bloom), how long and how deep the economic effects of this crisis are felt, and what (if any) is the geo-political fallout of events occurring.
And what of gold and its [broken link removed] The same rationale is being given - i.e. leveraged positions have had to be covered, margin calls have had to be covered. “There’s a lot of selling of every liquid asset for margin calls" (Matthew Miller - Gold market and equities analyst, CFRA).tecate has suggested some technical reasons, like folk meeting margin calls. I am not convinced. Could it be that Bitcoin has joined the establishment - if the Dow and FTSE are being dumped so too is Bitcoin.
It should be noted that the QE experiment is ongoing and has not reached its full conclusion. CBs can't continue to magic up money without there being a reckoning. Lets see what the US jobs report is for March in a couple of weeks. Interesting times ahead.It should be noted that Fiat has performed remarkably well, indeed far too well, over both this crisis and the earlier one. A far cry form the oil crises of the seventies which saw massive inflation.
Ok, they're obviously running to bonds then right? No, the yield on 30-year and 10-year U.S. government debt dropped to their lowest levels ever.
Doesn't this suggest that investors are running to bonds? Driving bond prices higher resulting in lower / negative yields.
Could it be that Bitcoin has joined the establishment
It should be noted that Fiat has performed remarkably well, indeed far too well, over both this crisis and the earlier one. A far cry form the oil crises of the seventies which saw massive inflation.
As pointed out by Wolfie, this means the exact opposite of what you think it does.Ok, they're obviously running to bonds then right? No, the yield on 30-year and 10-year U.S. government debt dropped to their lowest levels ever.
'bond funds' don't include just sovereign bonds. The outflows have been from risky bonds into treasuries."Analysts at BofA, parsing weekly data from flow tracking specialist EPFR, reported $136.9 billion of inflows into cash - the largest ever. Investors withdrew a record $25.9 billion from bond funds in the week to Wednesday."
I'm not a finance professional so please correct me if I'm wrong
Doesn't this suggest that investors are running to bonds? Driving bond prices higher resulting in lower / negative yields.
The ECB would disagree with you in this.I'm not a finance professional so please correct me if I'm wrong but as I understand it European banks, especially Italian and Greek are not well capitalised.
Who knows.So what will happen in Italy, Greece and Spain?
We don't need to make things up to argue a case for Bitcoin.
Fascinating statistics. I see that there was a spiked jump in Manufacturing GDP in 2015, I suspect that is Leprechaun economics. On a technical point asset prices do not actually feed into GDP although I think rents might.Employment figures, average industrial wage, debt to gdp ratio, inflation rate over the period etc...the obvious conundrum is back in 2007 GDP was valued at around $275bn. Today its valued at $381bn! A whopping 38% more than 2007.
Trading Economics - Ireland, GDP
What has happened, what have we done, achieved, to have an economy valued at 38% more than peak Celtic Tiger times?
In truth, this is primarily centred around rising asset and property prices. Leaving working people see the value of their wages diminish to the point that they cannot afford a home, cannot afford the rent.
Nothing like a genuine interest in accuracy and the truth Brendan. On that basis, I'd suggest you update the thread title to "Why are Gold and 'digital gold' crashing right now?"How else could you make a case for Bitcoin?
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