Rick, Steve, Al, and Cory discuss if the conventional markets are in a bubble
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Rick, Al, Steve, and Cory weigh in on the concepts of if the conventional markets are in a bubble.
Interesting comment considering that Doc thinks it looks pretty good today. Go figure!
AL AND CORY STOP BUTT TALK OR ! http://www.google.be/imgres?start=279&sa=X&biw=1280&bih=636&tbm=isch&tbnid=ghsR6i7GM1qPbM:&imgrefurl=http://www.sodahead.com/united-states/blue-state-blues-janet-yellen-to-be-named-federal-reserve-chair-could-be-next-week-goldman-sachs/question-3949595/&docid=04BsEQrIDlO6CM&imgurl=http://images.sodahead.com/polls/003949595/4042273208_janet20bitchslap_xlarge.jpeg&w=350&h=259&ei=VzeFUsmGOeGg0QX6hoCADA&zoom=1&ved=1t:3588,r:89,s:200,i:271&iact=rc&page=29&tbnh=193&tbnw=227&ndsp=11&tx=131&ty=67 no more BUT TALK BOYS !
Have you thought about tiunrng something like this into a novel? Reading it I started getting very excited about the future. It is obvious though that governments will resist decentralization, privacy, & freedom in extremely violent ways. The future will be brutal, but the idea of technology as the key to escaping the system offers some hope.
Are you buying stocks, James?
Matthew,
Any thoughts on two 3D PRINTING COMPANIES – DDD and XONE…fascinating industry. That is the only neophyte industry I think is really, really interesting
It is a fascinating industry. Sadly, I have nothing intelligent to say about it.
I’m don’t think this is correct. I’ll try to poke holes in it, irsenetted in your response.You effectively have three options in this model:1. Hold USD2. Hold Bitcoins3. Hold (and use) mining equipment.The value of the mining equipment (especially GPUs) can be approximated to fall slowly against the USD, due to depreciation. In short timespans, it’s probably negligible, but let’s just assume we lose 0.01 USD’s worth per day.Then, given your data, the most profitable course of action is to hold US dollars. If we hold the USD from start to finish, we maximise our return (regardless of which currency you measure it in). So why would anyone mine when the currency falls?Instead of tracing out a half dozen possible price scenarios by hand let’s set up the exact model of mining/holding usd/holding btc.I’m using a single time period for this, but the same reasoning can be extended to handle multiple periods. I’m also valuing everything against the USD, but it’s trivial to show that the logic remains the same regardless of which unit you use to measure.Let B0 be the value of 1 BTC in USD at the start of the investment period.Let B1 be the value of 1 BTC in USD at the end of the investment period.Let M0 be the purchase price of the mining rig (in USD).Let M1 be the resale value of the mining rig at the end of the investment period (in USD).Let E be the cost of running a mining rig (in USD)Let R be the amount of bitcoins mined during the investment period.Then the return of holding 1.00 USD is 1.00 USD, since we’re not doing anything.The return on holding 1.00 USD’s worth of Bitcoins is (B1/B0) USD.This is the trivial part: As long as Bitcoins appreciate against USD, they’re a better pick.Now the return on 1.00 USD’s worth of mining rig is:The return on the physical hardware: M1/M0Plus the value of the generated bitcoins: B1*RMinus the value of the electricity spent: EGiving us: (M1/M0) + B1*R ENow it’s entirely reasonable to assume that (M1/M0) 0, so the only source of profits against the USD comes from B1*R. So higher bitcoin prices, and more bitcoins generated are what leads to mining being profitable. In the extreme case of bitcoins going to zero, it’s obvious that all the mining did is waste electricity and depreciate a piece of equipment.I’m sorry for digging all the way into the gory details, but this is the best way of taking all factors into account without fixating on what numbers are being used.
It is getting late to buy general stocks. An etf like UYM (materials) has gone from around 28 to 46. I got out too early at around 37 and went to gold stocks to lose again. Cisco is down about 12% today and can impact the market. Gold stocks got shorted when Barrick announced the 3 billion offering and by the jobs report.
Franky,
Please make you comment intelligible.
Paul L,
I sympathize.
Yellen sounded clueless and not very smart. Don’t depend on her advice. She had said there was no housing bubble and that the housing market was too small cause a major impact to the economy. (Prior to the crash & QE).
Even Jim Puplava is drunk on the Yellen kool-aid.
Common Paul L, she really said that!
I guess you need to define what a bubble is. In my mind stocks and bonds are in a bubble. However, with Fed support they will continue to do well. There is no way to determine how long this mania will continue in stocks nor is there any way to determine when gold will shine. Except for educated guesses. Stocks seem way overvalued though.
Glen,
That is what I was trying to say.
Matthew – No I am not buying any stocks. The boat sailed.
Ive had some mining stocks for the last several years that have done nothing.
The only non mining stock I own, which I stated on this website and recommended buying was Nuskin. NUS. You can look up my comment and the current price stock.
I am actaully planning on selling NUS today. Why? Becuase it had its run.
Alot of money was made, and I am not about to make the same mistake I made with gold.
So no I am not buying stocks, dont intend to.
All I can do now is watch them go to the stars, watch clueless people make a lot of money, and sit on my gold that isnt doing a thing for me
If you are talking about conventional stocks, I agree, the boat has sailed.
There are plenty of fantastic opportunities in the miners.
There absolutely are Matthew. The big question continues to be a person’s time frame.
You know James the million dollar question right now is what should we be doing regarding invest/saving. I am content to play the waiting game for now. I certainly would not be a seller.
Matthew – I forgot to mention though I am planning on buying some bitcoins.
But the process is a little complicated
Only 22 million bitcoins can ever be made, however they can go to the 6th decimal place which is not good.
However it is a distributed peer to perr currency that cannot be manipuleted by the government. They can try to shut it down but will have a hell of a time doing it.
So even though it has no intrinsic value I think it has a very bright future.
They can push gold around but short of shutting down exchanges and raiding bitcoin wallets they will have a very hard time.
I considered buying, but didn’t, a few years ago when they crashed from (I think) $17 down to as low as a cent. Big mistake…
On ____ it looks terrible today. Really really terrible today …. TTP Exposed: WikiLeaks Publishes Secret Trade Text to Rewrite Copyright Laws, Limit Internet Freedom posted November 14, 2013, — The Cato Institute seems to love it, Lori Wallach, director of Public Citizen`s Global Trade Watch, is alarmed by it as much as Congress whose been left out of it entirely, and Obama loves it too. Obama wants to fast-tract it ASAP, by pass Congress AGAIN. It looks to me yet another TREATY with big corporations to do what ever they want, when they want anytime they want, and the hell with all of us. – – Does this sound like similar notion held by Obama, or should I say king Obama. – Makes me think, does this sound like another piece of legislation that`s too big to fail, eg. the Patriot Act, or NDAA was or what the Federal Reserve Act was, before anyone knew what hit them. http://www.federaljack.com/tpp-exposed-wikileaks-publishes-secret-trade-text-to-rewrite-copyright-laws-internet-freedom/ or go to youtube which by the way would become illegal to use youtube anymore because of TPP, or illegal to quote anybody for fear of becoming a rogue element `terrorist` with any free speech. https://www.youtube.com/watch?v=e6OZyRQbQ2k its 20:42 in length –
James, I thought about bitcoin awhile ago. I always thought it needed to be fiat to have a value. Right now people are trading it thats true, but I dont know of a single preson or company that uses it. I mean, I havnt seen a gas station grocery store etc. Those useing it need to be found online. Even if I did find someone I bet they still accept my dollars. I just have no use for it, as well its a hard thing for me to use. So, I decided against bitcoin.
Eventually tho, we will go digital, we have already gone electronic, but the digital currency that I would use will be fiat, that way I can pay my taxes with it.
Until then, I see no use for it. Unless you buy with the intention of reselling, kinda like the pixes on the screen we buy and sell know.
It aint money till we sell em and buy gold.
That is the conclusion that I came to after taking a cursory look at it.
“A Canadian mining company agreed to pay a contractor in Bitcoins for exploration work to be carried out at a property that contains tungsten.”
http://www.bloomberg.com/news/2013-11-12/miner-to-pay-in-bitcoins-for-work-at-tungsten-project.html
Irwin, I wonder why? Wouldnt it have been easier for the exploration people to just buy their own with the cash they recieved?
I don’t know b.
Everything about bitcoin is a total mystery to me!
Me too, Irwin!
http://www.youtube.com/watch?v=UuMKcVQ84Fo can help .
kinda like the pixels on the screen
I keep thinking we are being setup for a great fall.
In exactly what respect, TJ?
Kenyacare is a tax (that is what makes it constitutional, so says the Supreme Court), but no one is signing up (unless you call 105,000 out of 350 million = point zero three percent something). That is a tax revolt. Now the Kenyacare provisions providing for 16,000 new IRS agents and warrant-less searches make sense. Virtually everything we see and hear in the media is designed to rob the middle class. Stick with fundamentals.
Hat’s off to you Wayne!
Will the IRS agents be required to wear rubber gloves, as the NSA, when seeing if you have healthcare……,,,
I mean ,,,TSA….but, I bet the NSA,wears rubber gloves also….most likely got a group discounts at Walmart.
Bitcoin is a fascinating story and have many advantages.
First you mention fiat, so you have to ask yourself waht is fait?
fiat simply means by dictate. right now our government is dicating we use the U.S. $, this is fiat.
Bitcoin is growing in popularity not becuase of fiat, but becuase of its advantages.
People invest in bitcoin not out of compulsion, but because they appreciate the value it offers.
it has no central government, institution or organization to oversee it.
No government to inflate it
Very little transaction fees
ultimately more and more companies will accept it, they wont have a choice
and unless they shut down the whole internet you can get at your bitcoins, unlike cyprus when they declared a bank holdiay
all and cory NEW TIME ( SOVJET UNIE TIME ) http://www.google.be/imgres?sa=X&biw=1278&bih=650&tbm=isch&tbnid=lPZ7H6Rq4cWrRM:&imgrefurl=http://forum.paradoxplaza.com/forum/showthread.php%3F504603-American-Monarchy-Flag&docid=2J7NO8am9a4nrM&imgurl=http://img218.imageshack.us/img218/3810/usacsa.jpg&w=609&h=441&ei=Wk-FUuvZKceI7AaP9oCwAw&zoom=1&ved=1t:3588,r:2,s:0,i:85&iact=rc&page=1&tbnh=170&tbnw=264&start=0&ndsp=5&tx=101&ty=61 Denial denial ! usa is GONE !
Not quite yet Franky!
I understand that stuff. James.
My thinking is, we need taxes to pay for services,police,hospitals,roads, etc etc.
I dont know how a society would work with no taxes.
Yes, I understand fiat, I have had to explain fiat a few times to people.
Even educated people get mixed up on it. Like J.Rickards says”we now have two generations of economists that have not studied gold”. for example. The education itself has become questionable.
Anyway, I cant figure how a society would work without taxes for the common good. Therefore my thinking is a currency needs to be fiat.
Im not saying there isnt a way to do it,just I cant figure it out.
I look back on “taxless” societies and personaly, I dont want to go back there.
The problem as I see it: Bitcoin takes monetary control out of the hands of *ALL* governments, providing a strong incentive for them to cooperate to regulate it. Possibly by rebuilding the internet – which let’s face it, all governments by now hate as a source of freely distributed alternative views…
And although bitcoin (as I – poorly – understand it) can operate peer-to-peer, the bulk of bitcoin cash transactions apparently go through exchanges, which need a physical location with a hospitable legal jurisdiction. A state with a big enough army can take that away.
My bitbug friends argue that widespread acceptance of bitcoin in exchange for real goods will eliminate the dependence on centralised exchanges. But exchange of bitcoin for goods can be legislated against; even large cash transactions are illegal in many places.
The volatility of bitcoin hampers its use as a medium of exchange, and makes it a daunting store of wealth (for sizable investments). It’s use as a medium of exchange can be legislated against, and there are strong reasons for governments to cooperate to do this. It looks set to have none (or few) of the attributes of ‘money’ within a few years, unless some governments adopt it (eg as an alternative reserve asset, or to deliberately undermine the USD?) or perhaps there are further technical developments (it’s undergoing intense development that I don’t understand at all 😛 )
Until then, it may be continue to be an excellent speculative play though 🙂
Al…If you hear from Mike again….you can extend a hand of friendship on my behalf.
and an Apology, for any ill feelings created in the exchange by me.
Respectfully
Jerry
btw……I do not think BIRD …was involved in the colorful exchange…..nor, participated in any name calling………….for the record…….
Thank you, Jerry. You are correct. There are plenty of reasons to drag my name into a conversation but this sure is not one of them. I have no dispute with the poster named Mike or with James Kosterhyrz (the referenced author). Not sure what the confusion is all about here……..
Bird…..this ,,,I think is the third time you have agreed with me…..is that any kind of sign…………or should I not let it go to my head……, you do not have to answer that.
oh,,,just having fun, just in case I said something that might be used against me, or taken out of context,,or posted on another website,,,or ………
Thanks Jerry,
But I still like the idea of throwing some folks to the gators!
Al, is that anything like baiting….he,he..
YELLEN MADE IT LOUD AND CLEAR.
BUY STOCKS – SHE HAS YOUR BACK.
We now live in complete bizzarro land
Gold looks terrible today. Really really terrible today…
I repeat:
Buy stocks to heaven
Buy bitcoin – the new gold