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Author | Topic: Bit Coin: 2 bit bubble | |||||||||||||||||||||||||||||||||||||||
PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
Bitcoin is not going to replace money. The transaction volumes required to do that are way, way above anything Bitcoin can manage. And that’s on top of it’s volatility (expect the “value” to take a dive if China bans Bitcoin “mining” as they’ve suggested they might).
And since you’re hot on a currency being backed by something, tell me - what backs Bitcoin?
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
I don’t think it’s actually good for anything worthwhile. It is used for things like ransomware payments.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
quote: Says the guy who doesn’t understand basic finance.
quote: So you say, but I’ve yet to see any real support for it.
quote: That doesn’t make a lot of sense. An artificially high dollar brings problems. A rise in gold prices doesn’t seem likely to lead to the dollar losing value relative to other major currencies. Skyrocketing prices for gold would cause problems for everyone who uses it as a material. Also a bubble like that is not a sign of “dependable” “purchasing power” at all. It’s usually followed by a crash.
quote: Constraining supply doesn’t keep prices artificially low. It keeps prices artificially high. If the central banks wanted to keep prices low they would have to sell gold, not buy it and stockpile it in their vaults.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
Since you’re boasting of how clever you are and you’re so sure you’re right about the price of gold ([msg=887226]) please explain this:
If you doubt the manipulation and if you think that gold is, as John Maynard Keynes proclaimed, "a barbarous relic", explain to me why the central banks own nearly half of the world's gold and expect to increase that number? The price is definitely manipulated to keep the true value low. That is not manipulating the price of gold to to keep it low. It’s not even a sign that the banks think the price is low (else they would be buying now). The basic concepts of supply and demand are not that difficult. So explain why you think that the banks holding on to large stockpiles of gold (constraining supply) - and planning to buy more (future demand) indicates that they are keeping the price down.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2
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quote: More accurately they own it as an asset. It’s not specifically to back the currency. The dollar is not based on gold. That’s not been the case since it was taken off the Gold Standard (by definition!). The gold stockpiles are just another asset.
quote: Even with that amount there are limits to what they can do. And that they could do something doesn’t mean that they are doing it.
quote: Doesn’t manipulating the price qualify? Why not? I note that NONE of what you say indicates any price manipulation at all. And that was the point you were meant to be explaining. How does the fact that the central banks own lots of gold and plan to buy more show that they are manipulating the price to keep it low? If it doesn’t, then why did you so confidently assert that it does?
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2
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quote: No. If it was clear evidence of manipulation to keep the price low - that we should understand without listening to all that crap - you shouldn’t need anything else. If it isn’t - if even you don’t understand it - then you were wrong and should admit it. And, in fact, basic economics says you are wrong. Holding onto large stockpiles doesn’t hold the prices down, noting an intent to make future purchases doesn’t keep the price down. In fact both of them would tend to keep the price up.
quote: Maybe it is, but misunderstanding economics is not going to help you. If you are getting things so badly wrong and confused then I don’t think the answer is to listen to more of the material that got you into that state.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2
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quote: Belief and understanding are not the same thing. If you can’t explain it in words it is likely that you don’t understand it. More importantly the claim you expect us to accept goes directly against basic economics. If you didn’t understand that it’s hardly likely that you understand what you’re talking about. It seems to me far more likely that you’ve fallen for a sales pitch.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2
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One way to make profits would be to fool people into thinking that the price of gold would hugely increase in the near future and then to sell them gold (often at a premium) or investments (or “investments”) that will supposedly profit when that happens.
That’s exactly what this looks like. )Indeed, the whole idea that the prices are being suppressed might be an attempt to cover for a previous scam of the same sort. After a while people begin to notice that they aren’t getting the profits they were told to expect.)
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2
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quote: Why else would they try to deceive you into thinking that the price of gold was being held down. Let me remind you:
quote: This gives no reason to believe in the supposed manipulation. None.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
The thing that strikes me about the transcript is that he says that the price of gold and silver is rising (a “bull market”) and the “manipulation” will continue the rise.
So the “reset” will be a fall in the price (the end of the bull markets). That really doesn’t support your idea that the price is being kept artificially low.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
quote: Banks like stability. Highly volatile assets are more the province of traders.
quote: It might not be the International standard for pricing gold or oil in the future. But it is certainly going to be the standard for ordinary US bank accounts - just like ordinary bank accounts in most countries use the local currency. Likewise properties in the US would continue to be mostly priced in dollars just as properties in other countries are mostly priced in local currency.
quote: Nevertheless the end of the bull market necessarily involves a fall in prices. I never suggested that a bear market would follow. But none of this suggests that metals are good markets for ordinary investors. Quite the opposite, really.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
Another point - this doesn’t make much sense to me:
manipulation is never going to end uh ever since gold and silver have been money they've been manipulated i mean not electronically through paper but the baser currency the melted down coins put added copper and main new ones with the lower gold or silver content Debasing the coinage was a common trick, but that isn’t really manipulating metal prices. It’s just decreasing the metal value of the coins to below their face value. I’d say it comes in somewhere between minting more coins in a fiat currency and doing the same in a gold standard currency - when the bank doesn’t have enough gold. (Worse than the former, maybe not quite so bad as the latter). The metal prices don’t really change - and by my understanding old coins (not debased) would often retain their value.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
All right. What facts support the idea that the banks are keeping the price of gold low? That they are holding large amounts of gold certainly does not.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
quote: Let us note that you need a 12% rise in the price of silver to break even on your recent purchase.
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PaulK Member Posts: 17822 Joined: Member Rating: 2.2 |
quote: That’s opinion, not fact. So is the idea that value should be based on precious metals. They aren’t any better just because you don’t like the alternatives you see.
quote: I thought you were asking for a fact-based discussion, not one based purely on opinion Especially as there isn’t even a decent connection between the opinions and the conclusion. And if gold were the basis of value the banks would have even more incentive to keep it stable.
quote: If demand was boosted sky-high the price would quickly rise, yes. But obviously that demand doesn’t exist right now. Are you blaming the banks for that? On what factual basis ? So let’s note you ask for a fact-based discussion, and then utterly fail to produce facts supporting your position.
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