Quote from: Biodom on September 01, 2014, 09:02:43 PM

Quote from: AnonyMint on September 01, 2014, 07:11:56 PM

Quote from: rpietila on September 01, 2014, 05:47:24 PM

What?? Bears infesting my thread? Angry

Please note I qualified my post saying it was targeted to those who need cash within 6 - 12 months. I wasn't asserting anything about the long-term risk vs. reward analysis.

Near-term risk is limited to the upside, and greater to the downside. Last time we had this discussion @ $600, Bitcoin came down to $350 just as I expected. I could end up wrong this time, but I am having difficulty finding a catalyst to the upside near-term and the downside risk is potentially revisiting $350 or breaking through to lower lows as silver did.

As Armstrong says, don't fight the market. Let it speak to you. Fundamentals apply long-term, but not short-term. Just the same as for silver, all the perma-bulls have to be wiped out before a bottom is achieved. Don't ever get married to an investment.

So my post should not have made you angry if you read it carefully.

Quote from: rpietila on September 01, 2014, 05:47:24 PM

A: value $1,000,000
...
A: probability 20%
A: duration at least 3 years, up to 10 years
current: $500.

Long-term (up to 3 years or more), I place 1% probability on $1 million, 10% probability on $100,000, 20% probability on $50,000, and 80% probability on $10,000.

So my risk vs. reward calculation for the long-term differs significantly from yours, but it is not bearish and I wouldn't advise long-term hodlers to sell except to diversify into any suitable faster growing alternatives in market cap weighted proportions.

The dollar and the US stocks look more attractive between now and 2015.75 and will maybe be pulling capital out of Bitcoin.

this is one strange prediction: no growth in price (or negative growth ) until Oct 2015, then 20-fold appreciation (with 80% probability ?) in the following <24mo.
In any case, this would allow me to convert more of my ongoing $$ earnings to btc/xmr stash.

Good point. Note I did say "3 years or more", so the $10,000 is when ever Bitcoin reaches its peak price not necessarily within 3 years (because my somewhat technologically informed expectation is for Bitcoin to not be the final winner in the crypto-currency arena). First some opinion, which is basically worthless. I am thinking more along the lines of sideways to down for some months (say pull the number 3 or 6 out of my arse) then a slower averaged rise (with potentially sharp rises and drops) until the blastoff when the ensuing stampede (retail investor isn't even in the USA stock market yet since they left in 2008/2009) into the dollar and dollar assets has reached its peak around 2015.75. And also to give time for my (non-verified) assumption of the slowing rate of increase (i.e. deceleration) of adoption of Bitcoin (in my log-logistic theory) to catch up with the huge rise in the market cap in 2013. Remember Peter R showed that market cap correlates with the square of some proxy for adoption (as expected by Metcalf's law).

So let's say roughly my expectation is Bitcoin is back over $1000 in (late) 2015, and then up to a 10 bagger over next several years. And I expect the smoothed (taking into account the 2013 rise) rate of appreciation to continue to slow down in my log-logistic adoption theory. So the $10,000 would be reached sort of asymptotically rather than as a stampede peak. I think we are past the early adopter phase of Bitcoin, as it is almost 6 years old.

There could be another big jump in the price upon the next halving of the nominal rate of increase in the coin supply in 2017, although less pronounced than 2013 because the market cap is larger and debasement rate is continuously declining.

I do believe this period is an opportunity for long-term hodlers who don't have their market cap weighted fill to dollar cost average to accumulate more. I was mainly writing that message to those (at least one I know who is not rpietila) who are top-heavy on Bitcoin and who have cash needs within the next 6 months. Essentially I was arguing for diversifying some (20 - 25%?) into altcoins, dollars, and USA stock market, although do note in my opinion (as far as I know since I don't have time to study deeply every altcoin) ~~most~~all of those are just investor pump short-term speculative timing rides. The altcoins appear to mostly follow a familiar pattern of pop on some misinformed stampede (greater fool theory of speculation) then they do a death spiral, e.g. Litecoin, Aurora, and Doggiecoin.

Quote from: Biodom on September 01, 2014, 09:05:11 PM

I cannot see why ltc would have any long term value.

The Scrypt ASICs have apparently killed the main reason it was needed as an alternative to Bitcoin for the GPU miners. The value of a coin is proportional to the hashrate applied to mining. Anyone who is making an altcoin and ignores the importance of mining is not going to beat Bitcoin.

We discussed this last month in rpietila's Altcoin thread, and I made the point that when PoW difficulty is not directly influenced by investor driven price, then miners have some say in the price. GPUs were made unprofitable by ASICs, so this is not a Litecoin investor driven change. Also investors now have to value Litecoin under the new regime where there is no strong feature that Bitcoin doesn't have. There is still the arbitrage reason to need Litecoin, but there are also other altcoins although liquidity may be much lower. I do expect Litcoin to bounce back some relative to BTC as the math argues it is oversold and an arbitrage opportunity. Also note that when BTC sells off, LTC sells off more. When BTC rises (except for recent decline due apparently to arrival of ASICs), LTC rises more. So LTC looks to be a good speculation (for diversification from BTC) as we approach a firm bottom in BTC, contrary to popular sentiment.

Quote from: sidhujag on September 01, 2014, 08:30:38 PM

Yea the dollar bullish scenario has been a long time coming but seems to be at bay because of the amount of printing that keeps going on.. so I think it may rise a bit but only before the next crash when rates rise 3x from here.. last time rates went low and rose they rose up about 3 to 4x the lows before the next bubble burst... This time its already so low that rates going to a few percent may be too much.. and thats when the confidence in the system breaks and we enter a new era.. hopefully a crypto currency backed financial system.

My former post contained a link to my recent summary of Armstrong's thesis, which says that printing is ending in all the western countries other than Europe and Japan. This was a secret central bank agreement to prop up those dying economies by driving bond investors to Europe and Japan (declining interest rates cause the value of pre-existing bonds to appreciate, whereas rising interest rates in the other western countries drive speculative bond investors out and the long-term bond investors such as pensions are dying).

Armstrong's ECM model had turning point this Sept 3 or 4 2014 which means the stampede into the dollar could accelerate and volatility could be very high in all markets this week! The Euro recently turned down. And now Draghi says Germany is wrong and the ECB must print trillions of Euros.