Edit: it's quite possible that I mistook your tone, or vice-versa
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Interesting idea, but your analysis is wrong. For one, you don't take into account that no one is going to keep bitcoins in cold storage not gaining interest anywhere. Secondly, you haven't taken into account the fluctuating price of YARR.
You also seem to be intent on mentioning "CPA defaults" in spite of being repeatedly told that we hold money with other people. We can't take the money and run because **we don't hold the money**. Do you see how that works yet?
No matter how you slice it, even at 1.9 YARR is the best deal out there besides pure pirate. That is the point. We pay out 4.3% at 1.39 and nothing else beats that. You can always come up with a pipe dream where it is cheaper not to pay insurance as long as you assume no one ever defaults. That is why you claim it is better to invest directly into pirate and keep coins on the side. The problem is that doesn't make logical sense; no one will ever do that.
In the end, insurance costs money (a premium) which is paid to the insurance company. This is why you feel it's too expensive; because you have to pay something. I get it. I agree YARR is overpriced at 1.89. When I sell the next tranche of shares it should get knocked back down to 1.40-1.50.
I'm going to be answering the part in bold. The second paragraph merely addresses one of the 5 "additional risks and detractors" and I'm going to concede that point. The third paragraph starts with an incorrect sentence, then moves on to make assumptions about lower than current market prices. It ends with a statement based on the part in bold, which I am going to address. The fourth paragraph does not have much for me to debate. I hope I'm not missing anything.You also seem to be intent on mentioning "CPA defaults" in spite of being repeatedly told that we hold money with other people. We can't take the money and run because **we don't hold the money**. Do you see how that works yet?
No matter how you slice it, even at 1.9 YARR is the best deal out there besides pure pirate. That is the point. We pay out 4.3% at 1.39 and nothing else beats that. You can always come up with a pipe dream where it is cheaper not to pay insurance as long as you assume no one ever defaults. That is why you claim it is better to invest directly into pirate and keep coins on the side. The problem is that doesn't make logical sense; no one will ever do that.
In the end, insurance costs money (a premium) which is paid to the insurance company. This is why you feel it's too expensive; because you have to pay something. I get it. I agree YARR is overpriced at 1.89. When I sell the next tranche of shares it should get knocked back down to 1.40-1.50.
The second bold sentence is easiest: no, I don't take into account the fluctuating price of YARR, however I do provide general formulas which will work for any price of YARR. I then give one example which uses the "last" price.
Now for the first sentence. Let me quote it again, since I've rambled quite a bit and might have put it above the page scroll.
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you don't take into account that no one is going to keep bitcoins in cold storage not gaining interest anywhere.
Here, we have a mis-communication. It actually reflects better on YARR if I don't do that. Here we get into time value.Quote
d. The investor loses the opportunity to invest the Guaranteed Capital elsewhere while invested in YARR. In order to spend it on a WikiSpeed car or invest it in the Dank Bank, one must withdraw it and the Exposed Capital from YARR.
What happens is that the 0.89 is risked. Pirate defaults --> it's gone. The 1 BTC is not risked. It's almost 100% guaranteed. Therefore, the risk of investing in YARR at a price of 1.89 BTC is mathematically equivalent to the risk of investing 0.89 in pirate and 1 BTC in cold storage. From there I say that it is the 0.89 which is generating about 0.0674% interest, while the 1 is staying safe generating 0% interest. An investor will put 0.89 at risk and 1 safely and enjoy 0.06 / week. If, however, the investor puts 0.89 at risk directly with pirate (pretend that this is possible, I'm simply working with the numbers of 1 share although this calculation should be scaled up -- the outcome would not change) and then 1 with PatrickHarnett (now pretend that Patrick is 100% guaranteed; I'd say it's close -- again, the outcome doesn't change much), the investor would enjoy 0.0723 / week. Similarly, if the investor put 8.9 with PayB.tc and 10 with PatrickHarnett, he would get 0.7141 / week.I hope I have expressed myself clearly enough to show that giving a "time value" to the guaranteed 1 BTC actually decreases YARR's value. In truth, I was planning on getting to the time value calculations in a later post in this thread, but I decided to leave the time value at 0% for simplicity's sake.
Note that the thread was not intended to bash you, YARR, or CPA. I do math. I enjoy it. And this thread is not professional investment advice.
Edit: oops, I missed your point about fees. The fact is that if you want to invest *right now* or get out *right now* (rather than wait for someone more urgent than you), then you'll pay a fee (is it 0.5%?).
This does not matter in the case of, for example, YARR vs FOO.PPPPT (actually, you'll pay a lower fee in foo because the overall price is lower, but let's ignore that), but it does matter very slightly in the case of YARR vs Bitcoinmax.
Edit2: If I need to make myself more clear, then we can do examples which involve different time values. I also had a graphing tool around here somewhere, and intersections are often more visually clear than algebraic solutions.
