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Old 14th February 2020, 12:23 PM   #481
Mycroft
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Originally Posted by psionl0 View Post
Bitcoin has been around for 12 years now and still commands a high price so I am calling BS on this.
A price driven only by supply & demand without any attachment to any intrinsic value.

The same can be said for diamonds, but at least they're sparkly and have some industrial purposes.
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Old 14th February 2020, 01:26 PM   #482
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Originally Posted by Mycroft View Post
A price driven only by supply & demand without any attachment to any intrinsic value.

The same can be said for diamonds, but at least they're sparkly and have some industrial purposes.
Bitcoin has purpose too, as a mean to transfer money. It's not much, surely, but it's not entirely useless.
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Old 14th February 2020, 01:55 PM   #483
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Originally Posted by Mycroft View Post
A price driven only by supply & demand without any attachment to any intrinsic value.
The price of everything is driven by supply and demand. There is no such thing as "intrinsic" value.
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Old 14th February 2020, 03:25 PM   #484
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Originally Posted by psionl0 View Post
The price of everything is driven by supply and demand. There is no such thing as "intrinsic" value.
Of course there is. Haven't we already had this argument?

Intrinsic value is value belonging to something by it's very nature. Diamonds are very sparkly, and that's part if their value. Gold is also pretty, but it also has industrial uses and uses in electronics. Wheat is valuable in that we eat a lot of it.

An item with intrinsic value has a built in demand. There will always be a demand for wheat, rice and corn, because these are staples to our diet.

Bitcoin? Not so much. We don't need it for anything, unless you want to buy child porn off the darkweb. There really isn't anything you can do with it that you can't do with a different and more stable currency.
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Old 15th February 2020, 06:40 AM   #485
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Originally Posted by Mycroft View Post
Of course there is. Haven't we already had this argument?

Intrinsic value is value belonging to something by it's very nature. Diamonds are very sparkly, and that's part if their value. Gold is also pretty, but it also has industrial uses and uses in electronics. Wheat is valuable in that we eat a lot of it.

An item with intrinsic value has a built in demand. There will always be a demand for wheat, rice and corn, because these are staples to our diet.

Bitcoin? Not so much. We don't need it for anything, unless you want to buy child porn off the darkweb. There really isn't anything you can do with it that you can't do with a different and more stable currency.
I don't know if I have discussed "intrinsic" demand with you specifically but I have pointed out many times that there is no such thing as "intrinsic value".

You are confusing utility with economic value. Something doesn't need to have a utility for a demand to exist. Used stamps have no utility but some types have a very high price just because of their rarity. Misprinted stamps should have even less utility but can be even pricier.

Even something that is essential for survival (and therefore, has an automatic built in demand) may not have any speculative value because of the supply side of the equation. That is why water is usually priced in cents/kiloliter and air comes free of charge.

The fact remains that bitcoin has been around for 12 years and shows no signs of going away. This is in spite of the almost daily predictions that it will fail "any moment now" during those 12 years. You might argue that people are stupid to waste so much money and energy in it but it doesn't change the reality.
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Old 15th February 2020, 11:26 AM   #486
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Originally Posted by psionl0 View Post
I don't know if I have discussed "intrinsic" demand with you specifically but I have pointed out many times that there is no such thing as "intrinsic value".
Of course there is such thing as intrinsic value.

Originally Posted by psionl0 View Post
You are confusing utility with economic value. Something doesn't need to have a utility for a demand to exist. Used stamps have no utility but some types have a very high price just because of their rarity. Misprinted stamps should have even less utility but can be even pricier.
Sure. Add Pogs, Beanie Babies, tulips and thousands of other things to the list too. Demand can be driven by other things than intrinsic value, but that doesn't mean intrinsic value doesn't exist.

Originally Posted by psionl0 View Post
Even something that is essential for survival (and therefore, has an automatic built in demand) may not have any speculative value because of the supply side of the equation. That is why water is usually priced in cents/kiloliter and air comes free of charge.
Right. Intrinsic value doesn't necessarily translate to speculative value. Things with great intrinsic value, things that are necessary to survival, may still be inexpensive and easily obtained. At least we hope so, right?

As an example, a farmer might not be able to make a living producing food even though it has a high intrinsic value, if the supply of food is too great for him to be able to sell for more than his production costs. At the same time, another person who produces various forms of crushed rock, the type of stuff people decorate their flower beds and driveways with, might prosper economically even though their product is purely decorative with very little intrinsic value.

But introduce some sort of upheaval to the economy, it could be war, disaster, political instability of some sort, and things change rapidly. People lose interest in the purely decorative and devote their limited resources to getting the necessary. Suddenly the one producing decorative rock can't find enough buyers to make a living but the farmer prospers because the demand for food soars.

Originally Posted by psionl0 View Post
The fact remains that bitcoin has been around for 12 years and shows no signs of going away. This is in spite of the almost daily predictions that it will fail "any moment now" during those 12 years. You might argue that people are stupid to waste so much money and energy in it but it doesn't change the reality.
Blah, blah, blah. This is your mantra, but here and now is relevant in discussing intrinsic value.
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Old 16th February 2020, 12:29 AM   #487
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Originally Posted by Mycroft View Post
Of course there is such thing as intrinsic value.
Of course not! you are merely redefining "intrinsic value". There is no such thing in economics. There is only "price".

Originally Posted by Mycroft View Post
Demand can be driven by other things than intrinsic value, but that doesn't mean intrinsic value doesn't exist.
Demand (as well as supply) can depend on many factors but regardless, supply and demand are the only things that affect the price of something. There is no "intrinsic" price.

Originally Posted by Mycroft View Post
But introduce some sort of upheaval to the economy, it could be war, disaster, political instability of some sort, and things change rapidly
That proves my point. Price can change rapidly with changing conditions because "intrinsic value" doesn't exist.

Originally Posted by Mycroft View Post
Blah, blah, blah. This is your mantra, but here and now is relevant in discussing intrinsic value.
Of course! The only mantra that should be repeated ad infinitum is "bitcoin is a bad investment" and no discussion thereof should be permitted.
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Last edited by psionl0; 16th February 2020 at 12:38 AM.
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Old 16th February 2020, 01:06 PM   #488
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Originally Posted by psionl0 View Post
Of course not! you are merely redefining "intrinsic value". There is no such thing in economics. There is only "price".
The highlighted portion is where you moved the goalposts.

Even so, I think Warren Buffett would disagree with your assertion as his strategy of "value investing" depends on defining an intrinsic value independent of the supply/demand driven share price. That's how one looks for undervalued investments.

Originally Posted by psionl0 View Post
Demand (as well as supply) can depend on many factors but regardless, supply and demand are the only things that affect the price of something. There is no "intrinsic" price.
Nor did I ever claim there is such thing as an "intrinsic price".

Originally Posted by psionl0 View Post
That proves my point. Price can change rapidly with changing conditions because "intrinsic value" doesn't exist.
Except that they change because intrinsic value does exist.

Consider Maslow's hierarchy of needs. Things at the bottom of that pyramid, those that meed physiological needs, are things with a greater intrinsic value.

Originally Posted by psionl0 View Post
Of course! The only mantra that should be repeated ad infinitum is "bitcoin is a bad investment" and no discussion thereof should be permitted.
Something you hear only in your own mind.
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Old 16th February 2020, 10:32 PM   #489
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Originally Posted by psionl0 View Post
This is not the thread for such a discussion but I think it is unfair to label people who borrow money from banks "parasitical recipients". There are plenty of legitimate reasons to borrow money (eg to build up a business).
Banks under the fractional reserve system have the unique ability to create counterfeit credit ex nihilo. The banks are parasitical, and so is anyone who benefits from their credit. The only legitimate form of credit, in my opinion, is pre-existing savings. Not every borrower deserves a loan, or a loan at manipulated low interest rates.
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Old 16th February 2020, 10:37 PM   #490
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Originally Posted by Tippit View Post
Banks under the fractional reserve system have the unique ability to create counterfeit credit ex nihilo. The banks are parasitical, and so is anyone who benefits from their credit. The only legitimate form of credit, in my opinion, is pre-existing savings. Not every borrower deserves a loan, or a loan at manipulated low interest rates.
Notice how I didn't say EVERY borrower?

That the banking system needs fixing is unquestionable but not the subject for a bitcoin thread.
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Old 16th February 2020, 11:58 PM   #491
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A straight forward technical appraisal of this entity that currently is valued at 3 Caterpillar Dow 30 companies that move mountains is this correction will run and run.

Last edited by Samson; 16th February 2020 at 11:59 PM.
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Old 17th February 2020, 12:57 AM   #492
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Originally Posted by Samson View Post
A straight forward technical appraisal of this entity that currently is valued at 3 Caterpillar Dow 30 companies that move mountains is this correction will run and run.
You need to lay off the mushrooms for a while.
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Old 17th February 2020, 02:53 AM   #493
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Originally Posted by psionl0 View Post
Bitcoin has been around for 12 years now and still commands a high price so I am calling BS on this.
That means exactly zip. There are a lot of niche things that are worth a lot individually but which have no larger market.
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Old 17th February 2020, 03:12 AM   #494
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Originally Posted by psionl0 View Post
You need to lay off the mushrooms for a while.
No.
My figures are correct.If you disagree you are wrong.
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Old 17th February 2020, 04:26 AM   #495
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Originally Posted by Samson View Post
No.
My figures are correct.If you disagree you are wrong.
How could I disagree with a post that trippy? I have no idea what you are saying.
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Old 21st February 2020, 01:09 AM   #496
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Originally Posted by psionl0 View Post
How could I disagree with a post that trippy? I have no idea what you are saying.
I'm not sure, but I think he's saying that bitcoin is overvalued because its market cap is in excess of 3x Caterpillar, an enterprise that produces things. In actuality, bitcoin is worth more than 3x Caterpillar as of 2/21/20, bitcoin is $303.1B, and Caterpillar is $75.68B ($227.04). This is also a fundamental, not a technical analysis.

I still maintain that the biggest value of bitcoin is the ability for people to expatriate their wealth quickly and privately. For instance, Chinese fleeing nCov can move millions out of China and evade capital controls. They can't do this with gold, or virtually any other way. This alone is worth something.
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Old 21st February 2020, 06:27 AM   #497
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Originally Posted by Tippit View Post
I'm not sure, but I think he's saying that bitcoin is overvalued because its market cap is in excess of 3x Caterpillar, an enterprise that produces things. In actuality, bitcoin is worth more than 3x Caterpillar as of 2/21/20, bitcoin is $303.1B, and Caterpillar is $75.68B ($227.04). This is also a fundamental, not a technical analysis.

I still maintain that the biggest value of bitcoin is the ability for people to expatriate their wealth quickly and privately. For instance, Chinese fleeing nCov can move millions out of China and evade capital controls. They can't do this with gold, or virtually any other way. This alone is worth something.
But can they ? They for sure can mine BTC. And they can move BTC. But can they buy BTC for Chinese yuan ?
Even I can't really buy BTC untracked, unless I send cash in envelope.
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Old 21st February 2020, 01:18 PM   #498
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Originally Posted by Dr.Sid View Post
But can they ? They for sure can mine BTC. And they can move BTC. But can they buy BTC for Chinese yuan ?
Even I can't really buy BTC untracked, unless I send cash in envelope.
As far as I know, the PBOC has banned cryptocurrency and ICOs in China. But there is probably a black market for it, even if there is no equivalent of localbitcoins.com. I can't really attest to how easy or practical it is to buy BTC in China, but I assume that there is enough supply to meet the demand, even if it carries some risk. If the countervailing risk is that you can't expatriate with funds and stand a good chance of contracting nCov, I'm pretty sure that millions of Chinese would be willing to take the risk of buying black market bitcoin.
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Old 21st February 2020, 02:02 PM   #499
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Originally Posted by Tippit View Post
As far as I know, the PBOC has banned cryptocurrency and ICOs in China. But there is probably a black market for it, even if there is no equivalent of localbitcoins.com. I can't really attest to how easy or practical it is to buy BTC in China, but I assume that there is enough supply to meet the demand, even if it carries some risk. If the countervailing risk is that you can't expatriate with funds and stand a good chance of contracting nCov, I'm pretty sure that millions of Chinese would be willing to take the risk of buying black market bitcoin.
True.
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