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08-05-2018, 02:14 PM
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#1
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Gone but not forgotten
Join Date: Jul 2012
Location: Peru
Posts: 6,335
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Krugman on Bitcoin
A NYT link to Paul Krugman discussion on cryyptocurrencies..
https://www.nytimes.com/2018/07/31/o...o-skeptic.html
Not particularly encouraging, and probably not a lot of interest here on ER, but certainly a lot of $$$ to be considered as part of the total economy... and what might happen in a worst case scenario. FWIW
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08-05-2018, 02:27 PM
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#2
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Recycles dryer sheets
Join Date: Aug 2013
Location: Roanoke
Posts: 173
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Krugman has been so wrong so often, this makes me want to jump into crypto!
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08-05-2018, 02:29 PM
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#3
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Mar 2017
Location: City
Posts: 10,349
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 Quote:
Originally Posted by imoldernu
... Not particularly encouraging ...
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Encouraging to whom? About what?
I have never though cryptocurrencies were anything but the current "madness of crowds." (" Extraordinary Popular Delusions and the Madness of Crowds" by Charles McKay, published 1841.) The reason is what Krugman calls "tethering." With a tulip bulb, when the market collapsed,you could still grow a tulip. With bitcoin you won't even have something you can use on the bottom of a bird cage. A bitcoin has zero intrinsic value.
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08-05-2018, 02:31 PM
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#4
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Moderator Emeritus
Join Date: Apr 2011
Location: Conroe, Texas
Posts: 18,713
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The only people that see value in bitcoin are the ones charging real money to handle the transactions.
__________________
*********Go Yankees!*********
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08-05-2018, 02:31 PM
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#5
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Full time employment: Posting here.
Join Date: May 2013
Posts: 756
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Quote:
Originally Posted by OldShooter
A bitcoin has zero intrinsic value.
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And a piece of paper with a green-ink IOU ...... does?
__________________
Believe me, my young friend, there is nothing - absolutely nothing - half so much worth doing as simply messing about in boats. ― Kenneth Grahame, The Wind in the Willows
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08-05-2018, 02:41 PM
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#6
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Mar 2017
Location: City
Posts: 10,349
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Quote:
Originally Posted by FIREmenow
And a piece of paper with a green-ink IOU ...... does?
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Well, I guess we could quibble about the meaning of the word "intrinsic" but the value of the bills in my wallet is established by the words "This note is legal tender for all debts public and private." printed on each one. Krugman addresses this in his piece.
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08-05-2018, 02:43 PM
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#7
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Full time employment: Posting here.
Join Date: May 2013
Posts: 756
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Quote:
Originally Posted by OldShooter
Well, I guess we could quibble about the meaning of the word "intrinsic" but the value of the bills in my wallet is established by the words "This note is legal tender for all debts public and private." printed on each one. Krugman addresses this in his piece.
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I see. Thanks.
__________________
Believe me, my young friend, there is nothing - absolutely nothing - half so much worth doing as simply messing about in boats. ― Kenneth Grahame, The Wind in the Willows
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08-05-2018, 03:53 PM
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#8
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Thinks s/he gets paid by the post
Join Date: Oct 2013
Location: Cholula
Posts: 1,595
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Quote:
Originally Posted by rwdflynavy
Krugman has been so wrong so often, this makes me want to jump into crypto!
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A better barometer would be DW's BIL. He's into Bitcoin and that alone is enough to make me run in the other direction.
__________________
Before you criticize someone, walk a mile in their shoes. That way, youll be a mile from them, and youll have their shoes. Jack Handey
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08-05-2018, 04:43 PM
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#9
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Thinks s/he gets paid by the post
Join Date: Sep 2014
Location: The Great Wide Open
Posts: 3,804
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I wouldn't believe Krugman if he told me the sky was blue and water was wet. He may be right about Bitcoin.
From what I heard lately it's Litecoin, man! Litecoin is the best, Bitcoin is so yesterday!
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08-05-2018, 06:13 PM
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#10
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Full time employment: Posting here.
Join Date: Dec 2012
Posts: 656
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Wasn't it Krugman, upon Trump winning the election, say something like we'll never see stock valuations go any higher, or something to that effect?
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08-05-2018, 06:18 PM
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#11
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Thinks s/he gets paid by the post
Join Date: Dec 2016
Location: DC area
Posts: 2,492
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Krugman on Bitcoin
Quote:
Originally Posted by FIREmenow
And a piece of paper with a green-ink IOU ...... does?
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Yes. It is backed by the power of taxation. Which is most certainly not the case with bitcoin.
__________________
FI and Semi-ER March 24, 2017
Consulting to stay engaged
"All models are wrong, some are useful." - George Box
There is always a well-known solution to every human problem: neat, plausible, and wrong. - H.L. Mencken
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08-05-2018, 06:35 PM
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#12
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Thinks s/he gets paid by the post
Join Date: Feb 2007
Location: Upstate
Posts: 2,950
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Paul Krugman the night of the election: "It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover? A first-pass answer is never… So we are very probably looking at a global recession, with no end in sight."
Here's my take: Anyone who would make this kind of statement should not be listened to for any investment advice. Why? It's not because he didn't support or like Trump...it is because he is letting his political bias pollute economic and investment decisions.
Early in the Clinton administration, I thought he would be bad for my investments (after so many good Reagan years and after a decent H.W. Bush run). So, I was very conservative in my asset allocation. But I realized sometime in 93 that my dislike for him didn't mean there weren't fundamental technological changes that were going to drive the market higher. Fortunately for me, I started to pile into equities with each paycheck and rode the 90's wave.
ETA: The most amusing thing about Krugman's quote that night is that he didn't even realize WHY the futures market was tanking. I believe they were tanking the night of the election when it became clear that Clinton had not conceded, and there was fear of a contested election. When she later (finally) conceded, futures started to rally....and never look back.
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08-05-2018, 07:02 PM
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#13
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Mar 2016
Posts: 8,968
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I'm glad I don't know who he is. Really I've never heard of him.
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08-05-2018, 07:27 PM
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#14
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Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Join Date: Jun 2014
Posts: 7,040
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My son got us into mining Bitcoin and other coins about 5 years ago. He knows what he is doing. With a small investment of 2 k we have cashed out 40k and them 100k. We each still have some coins left.
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08-05-2018, 09:31 PM
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#16
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Thinks s/he gets paid by the post
Join Date: Feb 2014
Location: Syracuse
Posts: 3,502
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Quote:
Originally Posted by Running_Man
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I liken it more to the CB radio craze of the late 70s.
Just another fad.
NOW GETOFFMYLAWN!
I still see no need for bitcoin. I've only known one person that used it for a completly legal, not non quasi legal if not completely illegal purchase.
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08-05-2018, 11:31 PM
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#17
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Recycles dryer sheets
Join Date: Nov 2017
Location: -
Posts: 220
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Quote:
Originally Posted by GravitySucks
I still see no need for bitcoin.
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I see no need for Euros or Swiss francs, either.
Crypto currencies have desirable properties of hard currencies (backed by something of both finite quantity and perpetual endurance) with desirable properties of soft currencies (fast electronic transactions.)
That said, I do not own any cryptocurrency yet.
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08-06-2018, 03:24 AM
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#18
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Thinks s/he gets paid by the post
Join Date: May 2014
Location: Utrecht
Posts: 2,650
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Ask Venezuela what they think of their fiat currency. Bitcoin for them is remarkably stable.
It's a complex domain, and we're slowly entering the disappointment phase. Once regulation kicks in in addition we'll see what the staying power is.
My current guess is that we'll end up with bits and pieces of the technology, and maybe one or two coin(types), everything else will disappear in a puff of logic.
Cryptokitties for example, the biggest application for ETH and a sort of Pokemon collectible card game, has collapsed in recent months. Bitcoin itself is sort of holding up, to my own surprise.
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08-06-2018, 05:22 AM
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#19
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Thinks s/he gets paid by the post
Join Date: Sep 2009
Location: Hong Kong
Posts: 1,688
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They lost me at "Krugman."
__________________
Budgeting is a skill practised by people who are bad at politics.
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08-06-2018, 08:16 AM
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#20
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Confused about dryer sheets
Join Date: Jun 2018
Posts: 6
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Quote:
Originally Posted by rwdflynavy
Krugman has been so wrong so often, this makes me want to jump into crypto!
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+1
This guy lost his mojo 15years ago and has spiraled downhill. Discredits his Nobel every year.
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