Commenting on my own post...sad. Just smarting about being downvoted to the bottom while the top comment makes the same point. I guess I need to be more expositional.
Robert Shiller's lack of familiarity with ICOs, as highlighted in this article, disqualifies his position on Bitcoin. "The conversation was edited and condensed for clarity." Shiller was unprepared to discuss Bitcoin.
Wouldn't it be better to ask if his position is any different, now that he has had time to research the topic? It would be helpful if you could provide material info to Mr. Schiller that he does not have, beyond the ICO revelation, so he can re-assess. You clearly have important info that he could use.
ICO's are now a core application to the cryptocurrency ecosystem and have thereby driven growth to Bitcoin. Let us know if there is anything else I've missed. Your communication techniques are exemplary.
To 99% of the population, Bitcoin is the only crypto currency. They don't care about the other 500 alts, they don't understand them. If/when it goes mainstream, BTC will be the USD of crypto.
No matter what happens, a win for any crypto alt is a win for Bitcoin.
No, another cryptocurrency (the word crypto is already used to mean something else) can gain steam while the price of BTC goes sideways or down, and eventually win. Just saying the statement "no matter what happens" is false.
Can is not the same as Will. 500M people could download the Lyft app tomorrow and stop using Uber, but they won't. I can't predict the future for BTC, no one can, but I'm skeptical of it being supplanted. It's got a huge lead in public awareness, and the public doesn't understand crypto currencies and isn't looking for new ones.
Re 3: read "behind" as "backing" not "orchestrating in the shadows"
major US banks and whatnot have started to make crypto/bitcoin plays in the past few years. The idea is that these plays are early for them, and their followthrough of these ideas will be good for bitcoin.
Of course they could also die the death most moonshots do.
We like to make fun of "this time it's different" around here, but I think also a lot of people here think it really is different this time with cryptocurrencies.
As he is the author of Irrational Exuberance, and craftily deconstructs how rational people bid assets to "inexplicable heights", you should begin to notice in this interview that his definition of bubble is quite broad. "Idea epidemics".
By his definition, capitalism itself would be an idea epidemic, and that doesn't mean that it is going away, and that same applies to any of his bubbles. The only intention of pointing this out is that you are left at square one for finding your own validation or analysis in asset pricing, and cant defer to this authority for a conclusion in the present.
Him calling something a bubble doesn't mean the asset is mispriced, is overpriced for all time, incorrectly priced, or that it will revert to a lower price.
He would be an excellent commodities trader, if he stopped focusing on real estate and stock market indexes. Ebbs and flows in prices are not AT ALL controversial in the commodities market, expected even, and equally why they never caught on for retirement planning, because they can't fit into the "idea epidemic" that they go up forever.
It isn't controversial that an "idea epidemic" that makes bitcoin exciting can come to a lull and lower demand. Just trade it.
"It kind of fits in with the angst of this time in history"
If that's his best explanation of the BTC bubble, I find it lacking. He didn't really have any argument for why it's a bubble.
It's a real question that deserves real analysis. BTC offers real value, but of a kind that's really hard to measure.
1) The ability to keep your money safe (safer?) from your local (possibly corrupt) governments.
2) By one important measure, it's the safest crypto-currency because it's so widely used and accepted. It offers the largest markets so you can have confidence that you'll be able to sell your BTC, even if you have a lot of BTC.
But what are those things worth? What real value does BTC derive from them. Is it worth $2,000? $4,000? or $200? if it's real value is $4,000 or $2,000, it's absolutely not a bubble any more than the USD is in a bubble because it's used for trillions of dollars of daily transactions.
BTC offers value many in the world want and need. What that value is actually worth is lost in circular arguments between the bubblists and BTC pumpers.
It wasn’t that long ago that we held rich people in contempt.
Funny, this goes against everything I've read on the topic about the US. For example, just this week I read Cleese's So, Anyway, where he mentioned how when he lived in the US, in the early 60s, he noted how money made you respectable, and regardless of how you made it, whereas in Britain it was taboo to talk about making money.
23 comments
[ 4.4 ms ] story [ 15.6 ms ] thread1. it's a limited resource
2. it lets people do things no other financial vehicles can
3. highly influential people behind crypto haven't had their fun yet
So - no, I don't think this is a bubble.
2. see 1
3. not sure what you mean by this
No matter what happens, a win for any crypto alt is a win for Bitcoin.
major US banks and whatnot have started to make crypto/bitcoin plays in the past few years. The idea is that these plays are early for them, and their followthrough of these ideas will be good for bitcoin.
Of course they could also die the death most moonshots do.
By his definition, capitalism itself would be an idea epidemic, and that doesn't mean that it is going away, and that same applies to any of his bubbles. The only intention of pointing this out is that you are left at square one for finding your own validation or analysis in asset pricing, and cant defer to this authority for a conclusion in the present.
Him calling something a bubble doesn't mean the asset is mispriced, is overpriced for all time, incorrectly priced, or that it will revert to a lower price.
He would be an excellent commodities trader, if he stopped focusing on real estate and stock market indexes. Ebbs and flows in prices are not AT ALL controversial in the commodities market, expected even, and equally why they never caught on for retirement planning, because they can't fit into the "idea epidemic" that they go up forever.
It isn't controversial that an "idea epidemic" that makes bitcoin exciting can come to a lull and lower demand. Just trade it.
Is this the economist equivalent of the martingale strategy?
The Nobel prize for economics is not a real nobel prize
If that's his best explanation of the BTC bubble, I find it lacking. He didn't really have any argument for why it's a bubble.
It's a real question that deserves real analysis. BTC offers real value, but of a kind that's really hard to measure.
1) The ability to keep your money safe (safer?) from your local (possibly corrupt) governments. 2) By one important measure, it's the safest crypto-currency because it's so widely used and accepted. It offers the largest markets so you can have confidence that you'll be able to sell your BTC, even if you have a lot of BTC.
But what are those things worth? What real value does BTC derive from them. Is it worth $2,000? $4,000? or $200? if it's real value is $4,000 or $2,000, it's absolutely not a bubble any more than the USD is in a bubble because it's used for trillions of dollars of daily transactions.
BTC offers value many in the world want and need. What that value is actually worth is lost in circular arguments between the bubblists and BTC pumpers.
Funny, this goes against everything I've read on the topic about the US. For example, just this week I read Cleese's So, Anyway, where he mentioned how when he lived in the US, in the early 60s, he noted how money made you respectable, and regardless of how you made it, whereas in Britain it was taboo to talk about making money.