Topic: You would be crazy to spend bitcoins when its rising so much in value (Read 2934 times)

Is a rising "bitcoin price" measured in dollars or goods equal to a falling "goods price" measured in bitcoins?
If so, we can simply look at falling "goods prices" measured in USD to see if people will hoard forever.

Computer parts are constantly getting cheaper. This means the "dollar price" measured in computer parts is rising. Do we hoard dollars forever? No, we buy computers even though they will be cheaper later.

QED.

+1
Spend your coins today!

By your logic, you would never buy a car because you could always get it cheaper if you waited. Would you go without food because you could always buy it tomorrow for less?

Have you  bought a computer or a phone lately? By your logic, that was crazy because if you wait a year the price will drop by 1/2. How do you justify your action?

Bitcoin is real.
Physical != real. Otherwise, no fiat money would be real either.

Paying in bitcoins is like paying in cash, so there is very little risk to the merchant. In addition, there is no credit card company sucking up his profits and holding back his money. As a result of these benefits, the merchant could lower his prices for bitcoin payers to encourage that form of payment.

If companies see that there is a demand for payment in bitcoins, they will consider it. If they don't see any demand, it won't be worth their time. Everyone that owns bitcoins could simply send an email to every company they deal with asking them to accept bitcoins, and the results would be dramatic.

Why does it matter if I buy bitcoins for real money, spend them, and then the merchant convert them back to real money instantaneously? Why not pay with real money in the first place then? I guess that would be cheaper considering all exchange rates. And as I said, I don't even know where I would spend bitcoins, I don't need Reddit Gold.

Further more. Considering the value growth, like, the value of bitcoin has grown more than 10 % during the last 12 hours. Why would I spend my bitcoins? If I wait they will be worth A LOT MORE. Dunno, I just can't see why my strategy is wrong.

That's not true. There's practically no actual use of gold bullion as medium of exchange. It's mostly a store of value. Bitcoin can be a store of value too.

Unfortunately, the result will be disaster if everyone does that. Bitcoin's only utility is as a medium of exchange. If it is not used as such, then it has no utility and no value.

If you don't want the value of your bitcoins to come crashing down, then I encourage you to spend bitcoins whenever you can. You don't have to cut into you savings, just buy an extra bitcoin. Spend that and save the rest.

I use real money for purchasing things, and bitcoins as a growing investment. There are barely any places for me (as a Swede) to spend bitcoins anyway. I think that is working quite nicely.

That is exactly what I have been saying. Once we can purchase almost everything with Bitcoins, people will spend Bitcoins because they won't hold any fiat money.

Well some things make you even more money than btc going up. Those things are probably limited to drugs and mining equipment, though -_-. And clearly mining equipment is just a way to get more btc, so that doesn't really count.

The answer is that it won't be a truly viable currency until the price stops rising so rapidly. Which will definitely happen at some point (obviously).

i want one million dollars for my coin!
http://www.youtube.com/watch?v=cKKHSAE1gIs

Have you not been on the forums??? Everyone already thinks the price will continue to rise. And what would you considered to be a high price? Most people said 30 was a high price, now look at it.

"is rising" -- you can't be sure that the price will continue to rise. When everyone assumes that the price will continue rising, then you have a bubble and it will pop.

My strategy is to sell some when the price is high, even if I think it is going to continue rising.

Doesn't gold and silver kind of do this?

But if everyone saved and had their own safety net to fall back on then why would we need gov...

ahh....

 

A rising price doesn't (and shouldn't) make people stop spending altogether. All it does is make people more careful about what they buy. When one's money is appreciating, one will be more selective in his consumption, and this is good.

The world could do with a currency that encouraged thriftyness and savings, as opposed to encouraging spending/consumption.

Someone else on this forum pointed out that there wouldn't be a problem if sellers showed the same confidence in bitcoin and adjusted their prices accordingly.

Deflation doesn't continue forever as long as you don't try to fight it.  There is an equilibrium that the value will tend towards.

Exactly this allows you to grow the Bitcoin economy while still hoarding.

No point to gold if you never use it.  People will be encouraged to save and spend on the things they need, and stop buying junk they may or may not want.  Problem with a depreciating currency, you're inclined to spend it sooner, rather than later.  With a depreciating currency, Joe's gotta work his whole life to make ends meet.  And if there's no work left to do, Joe's up shit creek, like Joe is right now, and he'd be further up the creek without a paddle if Mr. Obooba decided to pull most soldiers and bring them home; then there'd really be no jobs.  So the war keeps going with fiat contributing to the reason why there must be war in the first place; war creates jobs, and lots of them.

However, war is such a waste.  Yes, it creates jobs, but what's the point of a job when all you're doing is destroying, just so you can build all over again?  That's the magic behind fiat; you're a slave to it, until you manage to store up enough to ride the rest of your life on.  So wherever the jobs are, that's where you must go, and if that job is warfare, that's that.  Cash that works like gold suddenly looks much more attractive; considering work is becoming a thing of the past now that a single machine can replace an entire factory of workers with a few guys to run the thing and make sure it's working right (heck, machines are even replacing soldiers now), people need to save up now more than ever.  Fiat works when you live in a nation that must be constantly worked on.  But everything's pretty much there, now.  We have the infrastructure, we have the cities and the towns and the schools and the electricity and the Internet in several different forms, we have the parks and the farmland and the machines to run that farmland, we've got almost all the work done to live comfortable lives.  Everything's going to hell because we're still stuck to this depreciating currency, and nations can't expand any more than they already are.  Soon we'll have to colonize the moon, wage a war against it, destroy it, then colonize it again, just to keep jobs flowing.

Sorry, I think that was slightly off topic  But the point is, a currency like Bitcoin is exactly what we need right now; something to use sparingly, for necessities, and maybe then life will look up a bit.  There's nothing stopping someone from going hungry with 10k bitcoins sitting in their wallet--that is, unless they're a miser.  But they probably deserve to die if they're so cheap, they won't even buy food for themselves.

Simple:

Because you have to spend them at some point. When you die sitting on a pile of coins, whats the point?

You want the coins because you want to buy something at some point, right?

1)See potential purchase
2)Buy bitcoins for purchase
3)Wait 5 minutes
4)Purchase purchase
5)Profit.

I have seen this said a few times "you would be crazy to spend it when its rising so much in value".

I do not understand this. Sure, at face value thinking that you have X Bitcoins today that are of value Y, why would you get rid of X Bitcoins today when tomorrow their value will be 2Y?

But then how do you spend money? Do you keep fiat currency and spend that? That makes even less sense! Why keep fiat currency?

If you hold Y dollars that are worth X Bitcoins that will tomorrow be worth .5X Bitcoins, why have dollars?

My contention is that most of us are paid in dollars. We all have to pay for things. The best possible scenario for you would be to convert your dollars to bitcoins as quickly as possible and then use it for spending.

Otherwise, if you get paid and then wait a week to spend your fiat, then you have just lost a week worth of value gain.

You would be crazy to spend dollars when having dollars to spend in the first place is crazy.