A year or so ago I felt that the discourse on HN was so expert, I was afraid to join in. If a topic such as this came up, I would wonder, "Christ, is everyone on this board an economist too?" Time was, the pathos, the me-toos, and the ad-homs were unwritten.
I think that a lot of less qualified people recognized the quality of HN and began browsing here. When a general interest topic comes up, it's their opportunity to have an opinion.
With that comes upvotes and comments. I really don't care about your passionate, unnuanced assessment of American politics, or the articles you want me to read because they echo your beliefs. I want the stuff that doesn't make sense to me so I can make it make sense. I want to follow the economic and professional climate of this engine of innovation.
I found HN by following a link in a comment on reddit, to which someone had directed the admonishment, "Please don't ruin that." I won't say that HN has been ruined since I came here but it has undeniably changed.
I think that the issue of customer contact is a red-herring. What caused the issue was not that Sam contacted the customers, but that he cc'ed his threatening e-mail to the vendor to the vendor's customers.
Any reasonable person would expect the vendor to take umbrage to being threatened with press coverage in front of his customers. Sam would have had the best chance getting the problem fixed by sending a separate e-mail to the vendor that did not include a presumption of bad faith.
You might working with an oversimplified model of the market. If you have 1% of all bitcoins, you're not going to be able to sell them all at the highest standing offer-to-buy (OTB).
If the highest standing offer to buy is at $700, it's not going to be an offer to buy all 120,000 of your BTC. It might be an offer to buy 100BTC. So you sell 30BTC at $700 and then move on to the next lowest OTB, which might be 20BTC@$699.95. You walk down a line of highest OTBs and the new market price is the highest OTB that you didn't manage to exhaust. The price is lowering as you sell out.
Similarly, you're not going to be able to buy in with your entire pot at the lowest standing offer-to-sell (market price). You'll exhaust the lowest offer-to-sell, then move on to the next highest offer-to-sell, etc. The price is rising as you buy in.
Assuming that the market is efficient, the decrease in price as you sell out and the increase in price as you buy in will be perfectly balanced against each other, and any extraneous gain or loss will reflect changes in market information that occurred while you were executing. Of course the market is not in practice perfectly efficient, but that applies to any other traded commodity.
Ok, this was a weird segue. I thought we were talking about market capitalization and whether or not people use it outside of bitcoins, which they all do for basically everything.
However, non-voting common stock equities that do not grant dividends basically have no "intrinsic value" either I guess. It is just a proxy for the public opinion of the net worth of the underlying asset, similar to bitcoins.
I think this kind of "intrinsic value" line of reasoning isn't a very strong argument in general though because mostly the value of commodities is essentially based on the value people assign it via free market and psychological principles.
You sort of don't seem like you know much about econ/finance so I think it is strange that you are so outspoken about bitcoins.
BTC could still collapse, and it very well may. Even if we put the potential innovative benefits of btc aside though, things like this are more like cults vs religions. A cult is a cult until it has enough followers at which point it becomes a religion.
Cults and religions have a similar scam potential which is what it seems like you are feeling, however at this point I would say btc is reaching or possibly above Scientology levels of belief/followers. In fact the market cap of btc is possibly more than the market cap of Scientology right now. If btc is going to fall apart as a pyramid scheme it will likely be the largest to ever fall.
However btc is more than a pyramid scheme because it does offer some real benefits over the existing financial systems. The online blackmarket does require a currency similar to btc to operate. Right now sending money across borders is difficult and expensive. Right now buying things over the internet basically must be done with credit cards which has a lot of fees attached. Right now there is no real way to quickly send large sums of money to people without similar fees and specific hours of operation. You also have to go to a bank and deal with a lot of bullshit.
Whether btc will be the solution to these problems I am not sure, but it is a very big deal that it already has so many users/followers. That is the hardest part of changing things, getting large scale adoption.
Yeah I hear you pfisch you are definitely one of the more reasonable people I have come across in these arguments. But what I'm saying is this -- I'm certainly not an econ expert it's true but I've analyzed enough of the econ involved in Bitcoin to conclude that it's really not a viable currency and most involved are speculators or black market traders as you point out. And I firmly believe the exchange rates are totally artificial, since BTC are essentially not really transacted the way one would imagine a currency to be used. It makes more sense to say they are "traded". Speculator to speculator or consumer to business straight to 3rd party processor.
It solves a real problem, yes, but not so much so that every Bitcoin should quadruple in value every 6 months, this is a bit ridiculous. After all, one could implement a BTC alternative (Litecoin for example) and achieve the same needs.
So essentially yes I see Bitcoin as a cult of naive investors who think that because of its theoretical underpinnings it will save us all. The truth is, huge stores of it are owned by black market operations and early adopters who had an exponential advantage in the ease of getting these things. Its basically like a free money machine for anyone who had change left in their pocket after spending their first crop of BTC.
If the system were ever to go down via cashout or crash or whatever, these people have as good a shot at grabbing the exit cash as anyone else, plus they can trivially buy a ton of real-world goods now through stores that accept Bitcoin, who themselves essentially send 3rd party processors the bill since presumably the processors are the ones storing Bitcoins while paying out the current exchange rate (or maybe they put them on an exchange soon after). The processors are assuming the risk because they want a foothold in the emerging shadow Wall St landscape. These are people who are putting their blood/sweat/tears into building the infrastructure that is essentially just magnifying the wealth of the founders / online gambling institutions / black market ops.
If instead all the rational people were to abandon the cult & quietly cash out, all that baggage could be left behind. The online casinos could instead foot the bill, and we could begin again with a new more stable cryptocurrency that has more utility as an actual currency. Market volatility adds some lure into the intrigue of the system but it's really just a vehicle for wealth redistribution to those who are prepared to take advantage of a flawed system.
Btw telling me it's gaining traction as a cult is not really endearing me to the ecosystem. I'm just not a big cult-lover. :P
Right, there are several people arguing here against the entire project of naive modeling. The author's response is that you can criticise, but only in the form of providing a competing naive model.
From the post:
> If you disagree with these numbers or this distribution, there is no need for you to stop reading. Just download the code and change the numbers. Your change in these assumptions might completely invalidate my conclusions, or they might not matter at all. The best way to find out is to actually run the model.
Varying parameters and producing different predictions would not invalidate the model. What validates or invalidates a model is whether or not it actually predicts the behavior you're trying to model. Without a validity test, modeling is pure sophistry.
So instead of suggesting another naive model, let me suggest a way to augment the whole project: construct a model that successfully predicts actual, ongoing, real world behavior. Test your model against actual, real world policy changes. If it has verified predictive power, then you have some base to claim that it can predict novel policy changes.
Any given person's opinion may condense decades of personal experience. I disagree with the author's claim that (even naive) mathematical modeling is better than personal opinion. Given any rigorous definition of better, that is frankly an empirical claim that the author has left unsupported.
I think that a lot of less qualified people recognized the quality of HN and began browsing here. When a general interest topic comes up, it's their opportunity to have an opinion.
With that comes upvotes and comments. I really don't care about your passionate, unnuanced assessment of American politics, or the articles you want me to read because they echo your beliefs. I want the stuff that doesn't make sense to me so I can make it make sense. I want to follow the economic and professional climate of this engine of innovation.
I found HN by following a link in a comment on reddit, to which someone had directed the admonishment, "Please don't ruin that." I won't say that HN has been ruined since I came here but it has undeniably changed.