Topic: Gold collapsing. Bitcoin UP. - page 967. (Read 2032274 times)

Krugman serves the ruling class who derive their wealth and lifestyle from their ability to be the first spenders of newly-printed money.

Of course he's never going to acknowledge that Bitcoin's limited supply is what makes it superior - his job is to help keep the hoi polloi ignorant of how they are being robbed.

The job of an economist is to cloak theft in the mantle of science to reduce the cost of keeping the masses compliant.

don't overlook a few posts up:

I think Erik Voorhees' open letter to Peter Schiff on this subject is very good.

http://www.reddit.com/r/Bitcoin/comments/1rxmk3/my_open_letter_to_peter_schiff_followup_from_the

This is the error which is obvious to many here, but not many mainstream economists.

Bitcoin has enormous fundamental value because of its utility. Rapid, global, transfer of monetary value without third-party intervention, is fundamentally of value. The security of the system, through mining, and the cap on total issuance are pillars which makes the technology monetarily viable.

There is a subtlety here: the stored value of Bitcoin derives from its ability to transfer value.

Eventually Krugman will figure this out, but it will be hard to accept as he will still cling onto the inflation-is-good meme.

Another commonly used indicator (for early deflation detection), is the Caterpillar company. It expands its profit (and debt to capital ratio), but the sales of machinery is down. This tells me that the company, like most large companies, is transforming from a production company to something like a bank.

http://www.caterpillar.com/en/investors/quarterly-results.html

I would be interested in the actual tonnage of machinery produced, which I suspect is also down, but I am too lazy to look for it now.

yes, and it's the worst of all.  new 5 yr low.

http://www.theaustralian.com.au/business/latest/iron-ore-price-at-new-five-year-low/story-e6frg90f-1227053318529:

Heh... Funny how bitcoin has put the likes of Peter Schiff and Paul Krugman into the same gotta-hedge-my-statements corner.

I don't like viewing bitcoin as primarily a payments-tech product. I feel the conversation has shifted largely to how bitcoin excels at executing online payments, which is true, and which I've myself pointed out to skeptics for a long time. The reality, though, is that the core proposition is control of your own money, an open ecosystem, and a mathematically known money supply (as we all appreciate). It just so happens that bitcoin is currently superior to virtually all payment networks as well, but that probably won't be the case forever. Legacy payments will probably get much better (more secure, faster, cheaper) over time, and then it should be clear that bitcoin's real distinction lies in the monetary characteristics. Perhaps ApplePay will re-shift the conversation.

Can you find iron ore?

here's the actual 5 yr copper price:

5 yr weekly commodity charts:

DBA-food



Wheat futures:



Corn futures:



Soybean futures:



FCX-Copper proxy-world's largest copper mine:



BHP-one of the world's largest mines:

About early signs of a deflation:

"The first proposition is that the prices of gold and other raw commodities are
extremely sensitive to changes in monetary conditions and are therefore good predic-
tors of future movements of general consumer goods’ prices, which tend to respond
much more slowly to such changes. As Bruce Bartlett (2001) wrote, “When one sees
a sustained fall in sensitive commodity prices—those that lead changes in the general
price level—one can predict that eventually this trend will work its way through the
economy as a whole.”
"

Deflation is generally benign, except a form called "confiscatory deflation";

"There does exist an emphatically malign form of deflation that is coer-
cively imposed by governments and their central banks and that violates property
rights, distorts monetary calculation and undermines monetary exchange. It may
even catapult an economy back to a primitive state of barter if applied long and relent-
lessly enough. This form of deflation involves an outright confiscation of people’s
cash balances by the political and bureaucratic elites.
"

These are excempts from an article on deflation by Salorno, who is an excellent writer. The article:

AN AUSTRIAN TAXONOMY OF DEFLATION—WITH
APPLICATIONS TO THE U.S.
JOSEPH T. SALERNO
THE QUARTERLY JOURNAL OF AUSTRIAN ECONOMICS

In the article a recent episode in Argentina is described, historically interessant, you can even hear about real barter with grain (cars for grain), and the resulting hoarding of grain as money, envisioned by Adam Smith (near the end of the article).

https://mises.org/journals/qjae/pdf/qjae6_4_8.pdf

Krugman is now hedging:

Do you think Bitcoin will gain momentum and become a viable currency?

No. I could be wrong, but Bitcoin is harder to use than other forms of electronic payment, and lacks any fundamental source of value (unlike dollars, which can be used to pay taxes). It’s possible that Bitcoin will somehow become self-supporting, but for now my guess is that it’s largely a fad that will collapse one of these days.

http://www.princetonmagazine.com/paul-krugman/

i agree with this too.  the last couple of months trading have looked extremely suspicious to me both on Stamp and Finex.  it looks like a coordinated manipulation downwards of price.

they can't do this long term however as there are only so many coins to be bought and borrowed to short.  the solution to this is widespread, numerous international exchanges in geopolitically diverse jurisdictions to prevent naked shorting like China (we have that fortunately already), Russia (BTC-e?), Asia (Singapore/Thailand), and the US.  as with mining, we need exchange decentralization.

I've always tried to refer to them as 'run-ups'.  I suspect that most of them since have been fairly carefully managed which would be quite possible in such an unusual market by my estimation.  I'm actually pinning my hopes on future manipulation by large players and insiders and have for some time.  That will be the most likely way to capitalize most effectively going forward.  Generally speaking, people in a position to play at this level have time and patience on their side.  I try to take a years-long perspective in my operations for this reason.  I consider massive manipulation and control to be a characteristic of a 'free market', and Bitcoin is probably the single most free market of any significance in recent memory.  In terms of size and importance it is right in a nice 'sweet spot' to make manipulations both practicable and highly lucrative.

i totally agree.  i've never called them bubbles.  simply ramps.

Precisely my point: If falllling or other trolls talk about bubbles, I don't really mind. But it became the de facto standard term even by long-term supporters of Bitcoin, which is odd in my opinion, and maybe it's my Asperger's gland^* acting up, but I don't like the abuse of the word 'bubble' that way.


^{* Yes, I know. Doesn't exist.}

Yesterday, we looked at why bankers weren't busted for crimes committed during the financial crisis. Political corruption, prosecutorial malfeasance, rewritten legislation and cowardice on the part of government officials were among the many reasons.

But I saved the biggest reason so many financial felons escaped justice for today: They dumped the cost of their criminal activities on you, the shareholder (never mind the taxpayer).

http://www.bloombergview.com/articles/2014-09-10/the-biggest-lie-of-the-new-century

one of Erdogan's criteria for deflation is decreasing commodity prices.  here you go. oil about to break major support:

https://twitter.com/cypherdoc2/status/509756882249326592