Quote from: cypherdoc on August 21, 2012, 02:16:25 AM

Quote from: sunnankar on August 21, 2012, 01:05:56 AM

Quote from: cypherdoc on August 20, 2012, 11:54:10 PM

it has been clear that i, so far, made a good decision to sell all my silver and most of my gold last year and put it into Bitcoin.

I do not think the minuscule Bitcoin market is large enough yet to draw any reliable correlations; but if the market were larger and the capital pools deep enough I could see the current inverse relationship between Bitcoin and gold maintained. Currently, in the universe of finance Bitcoin barely registers as a few atoms. But $3m+/day in volume over the past few days with such volatility is very encouraging for its future.

This proposed rule by the FDIC could have huge implications for the gold price.

mind explaining what this means?

I believe this would be the most significant section:

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A. Zero Percent Risk-Weighted Items

The following exposures would receive a zero percent risk weight under the proposal:

Cash;
Gold bullion;
Direct and unconditional claims on the U.S. government, its central bank, or a U.S. government agency;
Exposures unconditionally guaranteed by the U.S. government, its central bank, or a U.S. government agency;
Claims on certain supranational entities (such as the International Monetary Fund) and certain multilateral development banking organizations
Claims on and exposures unconditionally guaranteed by sovereign entities that meet certain criteria (as discussed below).

Essentially, the Fed is officially acknowledging gold, and only gold among metals, as a monetary instrument. That means it is on equal footing with bonds and cash. The result will be a rebalancing of portfolios to accommodate the changes. It wouldn't be surprising to see 5-10% asset holdings taken in the form of gold. In order for that to be viable, the price of gold in fiat terms would have to rise by an order of magnitude.

Keep in mind that, from the above list only one item has zero counterparty risk associated with it. Everything else can be left to fall off a cliff in relative terms.

Quote from: cypherdoc on August 21, 2012, 02:16:25 AM

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So, when it comes to preserving wealth gold is it. Nevertheless, I think Bitcoin has been an is going to be a great speculative and wealth transfer play.

you know what they say about great investments; you gotta make them when no one else sees it.

I don't think anyone here is disputing Bitcoin's potential, only that Bitcoin will not be the exclusive beneficiary of current trends.