IS BITCOIN THE GREATEST HOAX IN WORLD HISTORY?
WHEN PEOPLE ARE TAUGHT TO ACCEPT MONEY WITHOUT BACKING, ANYTHING IS POSSIBLE
History has passed down accounts of many speculative bubbles. The most famous was the European Tulip speculation of the 1630's which reached a peak in 1837 when a single rare tulip bulb brought 10 times the annual wage of a skilled craftsman.
There was also a speculative bubble in White Pine boards and Maine timber land in the 1830's, It was instrumental in contributing to the panic of 1837.
The common denominator in much of this was the debasement of the coinage in Europe in early 1600's. There was also the presence of futures market. This allowed prices to increase without the actual payment and sometime the taking possession of the Tulip bulbs. This was also the case in the 1830's in the U.S., much of the speculation was with borrowed money which let to the failure of numerous banks.
Bitcoin was started in 2011 at price market price of .008 cents. in one year it increased to $31.00, one year later had dropped to $2.00. It has been a very volatile market, but yesterday it was valued at $17,000. Bitcoin was designed to have a fixed number of coins created to compete with traditional money whose supply is continually expanded and thereby devalued. This is supposed to be a competitor to gold which is heavy and cumbersome and not accepted in everyday transactions. As of now Bitcoin is only accepted by a limited number of transactions, but has been gaining acceptance. This week a fledgling futures market has been created to trade bitcoins.
When the tulip market collapsed owners still had some tulips. As in other speculative bubbles, you still had the gold, silver or lumber or real estate. Bitcoin has no intrinsic value at all. Only the hope that someone will accept it for a product or that it will increase in value. How anyone can speculate on this is beyond me. I am old fashioned, things of value must have some substance, some physical value. I still don't understand how some internet companies with very little profit or physical assets can be valued more than a company like Exon-Mobile. I personally do not have a lot of faith in unbacked fiat currencies supplied most nations.
All governments now embrace currencies that have no real backing. This is convenient for them to run budget deficits and tax the citizens by devaluing the currency which has now become an instrument of debt of the government rather than an asset. In the U.S.this started in the 1930's and became complete in 1969. It has now taught generations that money is nothing more than a hope for the future rather than a real asset and has set the stage for the thinking that has allowed Bitcoin to be a reality.
Please look at the article, " A brief History of Money" from 10/12/2015
Bitcoin was started in 2011 at price market price of .008 cents. in one year it increased to $31.00, one year later had dropped to $2.00. It has been a very volatile market, but yesterday it was valued at $17,000. Bitcoin was designed to have a fixed number of coins created to compete with traditional money whose supply is continually expanded and thereby devalued. This is supposed to be a competitor to gold which is heavy and cumbersome and not accepted in everyday transactions. As of now Bitcoin is only accepted by a limited number of transactions, but has been gaining acceptance. This week a fledgling futures market has been created to trade bitcoins.
When the tulip market collapsed owners still had some tulips. As in other speculative bubbles, you still had the gold, silver or lumber or real estate. Bitcoin has no intrinsic value at all. Only the hope that someone will accept it for a product or that it will increase in value. How anyone can speculate on this is beyond me. I am old fashioned, things of value must have some substance, some physical value. I still don't understand how some internet companies with very little profit or physical assets can be valued more than a company like Exon-Mobile. I personally do not have a lot of faith in unbacked fiat currencies supplied most nations.
All governments now embrace currencies that have no real backing. This is convenient for them to run budget deficits and tax the citizens by devaluing the currency which has now become an instrument of debt of the government rather than an asset. In the U.S.this started in the 1930's and became complete in 1969. It has now taught generations that money is nothing more than a hope for the future rather than a real asset and has set the stage for the thinking that has allowed Bitcoin to be a reality.
Please look at the article, " A brief History of Money" from 10/12/2015
Originally posted 12/13/2017
No comments:
Post a Comment
comments and opinions published at discretion of editor