- This topic has 1 reply, 2 voices, and was last updated 2 months, 3 weeks ago by BuyRackTurk.
- Saturday, July 2nd, 2022 at 14:18 #324923EastL0ndonParticipant
This passage from Human Action stuck out to me as I feel as though it makes sense of what we’re seeing right now with regards to the price of BTC.
“It depends on the data of each particular case at what moment and to what extent the prices of the various commodities and services are affected. In the course of a monetary expansion (inflation) the first reaction is not only that the prices of some of them rise more quickly and more steeply than others. It may also occur that **some fall at first** as they are for the most part **demanded by those groups whose interests are hurt.”**
Recent changes in our economy hurt the interests of institutional investors as well as individuals who invested more than they could afford. A significant amount of the recent demand for bitcoin (in the last 1-2 years) were from these groups. These groups are selling and once sold there will be a new, lower, price.
However, the money supply has already grossly increased and therefore there will still exist a general tendency for prices to rise. This general tendency is not going to stop any time soon. At some point in the future the price of bitcoin will also begin to rise.
I believe after the price of bitcoin settles it will then initially rise slowly before rising more rapidly.
Why? Because at that point bitcoin will then be the only medium of exchange with a price that is rising. It will be a unique point in our economy. All other fiat currencies will likely continue to have a rapid reduction in their purchasing power. Individuals will feel the purchasing power of their own currencies drop whilst bitcoins price rises. People will therefore see that it is in their own interest to hold some bitcoin. This will further increase the demand for bitcoin which means even more people take notice and so on…
I also think at that stage there will be a very heavy propaganda campaign against bitcoin. It just depends on whether or not the “crack up boom” will be quicker than our governments ability to react.Saturday, July 2nd, 2022 at 14:44 #324924BuyRackTurk
If you divide the pool of bitcoin holders into three camps
Camp A – self custodial holders
Camp B – short term traders / fair weather holders / gamblers / regulated exchanges
Camp C – gullible users looking to get interest on their btc, keeping balances on exchanges, etc
Scammers, such as celcius/blockfi/etc borrow bitcoin from Camp C and lend it to shorters, rehypothercators, and all kinds of shady players from Camp B. When some of the gamblers in camp B eventually lose money playing their game, the loss is dumped on camp C by exchanges failling to pay back the borrowed btc.
Camp B will only have an outsized impact on the btc market so long as there is easy money to be made from the idiots in camp C. So long as idiots in Camp C exist, gamblers will be able to play games with other people’s money, and that tends to exacerbate the price swings of bitcoin away from its natural equilibrium.
Hopefull the pool of ready suckers dries up soon, people learn NYKNYC, and bitcoin gets back to normal as a market traded money commodity displacing fiat.
- You must be logged in to reply to this topic.
Related Forum Topics:
- → People are thinking about this all wrong. We are not shifting from low inflation to high inflation. We are shifting from high investment inflation to high consumption inflation.
- → THE INFLATION REDUCTION ACT OF 2022. They are printing another $0.5 Trillion dollars to fight inflation. USA is following in the footsteps of Turkey in printing more money to fight inflation.
- → The original inflation-hedge, Gold, is down -3% over a year with record-high inflation. Safe to say that there are no real inflation-hedges.
- → The REAL inflation rate is at 15% if you use the original CPI method which was ditched by the US Government to downplay inflation.
- → BTC price instantly dropped massively when governments gave vague hints about possibly stopping inflation somewhen in the future. Now the world is going to war – what will not only not stop inflation, but rather drive it up to new heights. Aaaaaaand BTC drops further…
- → Bitcoin inflation is 5 times lower than US dollar inflation
- → BTC Is The Least Popular Inflation Hedge: A Bloomberg survey of more than 800 investors had a surprising outcome when ranking inflation hedges: BTC came in last place. Genesis Trading Head of Market Insights Noelle Acheson says that may be because BTC is the least-tested of assets. [News]
- → In 2020 the government said that Inflation does not exist. In 2021 Inflation was only “transitory” and now they say that they will end it in a year…
- → Has Inflation Affected You Personally? If so, what are some everyday examples? Has crypto helped offset inflation in your life?
- → Hedging Against Inflation; Poll finds 79% of U.S. investors have done nothing, while 4.9% have moved into cryptocurrency. Crypto has overtaken traditional forms of inflation protection, such as TIPS (1.3%). [Crypto News]
- → BTC falls but, it’s nothing next to skyrocketing inflation. We don’t know how far this inflation would go. Don’t be fooled and stay strong.
- → Turkey Inflation just hit 73%, suprisingly just a 23-year high. All that after their president called to have inflation under control and that BTC is worthless.
- → Jerome Powell: We now understand how little we understand about inflation. Admits inflation models have been wrong for 40 years. Thank God for BTC!
- → Reality: money supply inflation -> money loses corresponding purchasing power aka inflation -> wages must also inflate to keep the economy functioning -> wages never inflate as much as real goods -> standard of living is reduced for all but the wealthiest. Housing in Boise is up 59% since 2020. [Image]
- → BTC is a hedge against inflation…. Inflation report comes out.. Well we can see how well this hedge is playing out and the store of value! Bring the hate!