patrick.net

Maga_Chaos_Monkey says

This is an imaginary boogeyman unless the govt is buying on margin and I haven't heard shiite about that.

Everything the government buys, it buys on margin....

The crypto-bros will try to convince the government to give it special status like tax-free appreciation (which cheats all the other taxpayers by increasing the deficit just to pump bitcoin price)... or worse, to buy it with tax dollars and hold it as a reserve... These are both ways to shovel taxpayer money into the crypto-bros pockets and have the taxpayer become the ultimate bagholder.

Either way, the taxpayers will wind up paying off a bunch of debt that was accrued pumping up asset prices for crypto-bros to cash in on. Lets not have that happen!

Its not an imaginary bogeyman... The cryptobros are lobbying bigtime for these things already. One senator has already introduced a bill to give it tax free status.

DeficitHawk says

Everything the government buys, it buys on margin....

Mostly if not entirely so far the government has it from criminal confiscation.

mell says

I don't see how bitcoin is different from fiat money, it's a real alternative, and the price is reflecting it. All the bitcoin haters could have prospered from buying bitcoin but instead they just keep bashing it and keep being wrong.

I disagree.
Bitcoin is not an alternative for "fiat money". You can't really buy anything with it as it is too slow and cumbersome for retail transactions. It IS fiat money for the fact that you buy and sell it for fiat and it is valued in fiat.

The price is so high because the supply is so low. If a million people want to buy $20 worth in a day and less than 500 "coins" are "mined" each day then each coin would be worth $40,000. The actual transaction rate is over 500,000 per day. Artificially low supply and high demand causes the price to be so high.

I'm not a gambler. Bitcoin is not an investment. It has no assets backing it. It's a Ponzi scheme where the only way you can make money on it is to sell it to a greater fool for more money than you payed for it.

Onvacation says

Bitcoin is not an alternative for "fiat money". You can't really buy anything with it as it is too slow and cumbersome for retail transactions. It IS fiat money for the fact that you buy and sell it for fiat and it is valued in fiat.

People have been making bitcoin transactions all the time without converting it to fiat money, not different from a wire. Part of the allure of course is/was that the government didn't tax it. Governments have been regulating around this as much as possible to get paid, using official/public exchanges etc. and new laws. I'm sure many still skirt it if you know how to, but even without the no fee/tax advantage there is another allure that it's append only and once a transaction has been written there is proof of it, vs banks and regulators who can fudge your.bank accounts to their likings as seen in Canada. This is intrinsic value backed by blockchain tech. Now if you say many dont care about this value then that may be true, as all value is subjective and subject to current conditions. Like you said not that many do habe to "value" it as the supply is scarce enough, so it has been a pretty well performing asset. It's very similar to fiat imo as opposed to gold, silver, or company/stock investmentd for example. Gambling refers more to how you trade/invest as to what you are trading/investing in, no?

mell says

Gambling refers more to how you trade/invest as to what you are trading/investing in, no?

Speculate?
When you invest in stocks you are investing in real people making real things. Your investment pays dividends and grows. The economy grows.

When you speculate in crypto, massive amounts of computer processing power and electricity are expended and you hope that someone will pay you more for it in the future. If the lights don't go out the bits go away.

You can call me a hater.

For a long time, I was content to ignore crypto and let the gamblers gamble. Its a zero sum game and there will be winners and losers... but whatever. Let the people have their fun.

But the recent trend of bitcoin treasury companies like MSTR, with some large enough to potentially get in to the S&P 500, I have to say I am starting to worry about systemic risk. Its becoming "heads I win, tails you lose".

The previous bitcoin crashes were non issues to the broader economy. IF the capital inflows to crypto continue like they are... it will get to a situation where a crypto crash will cause a financial crisis. It seems likely to me that we taxpayers will be taking the fall when the cryptobro's need a bailout under the name of 'contagion and systemic risk!'.. like in 2008

If for some reason you think that Fartcoin is over-valued, you can always short it.

Lemme know how that works out.

.

CAGR for Bitcoin since its inception in 2010 is 102%. Bitcoin has delivered a 57% CAGR over the past 4.5 years, outperforming stocks, real estate, and bonds. Only 450 new BTC are mined daily, and most are absorbed by ETFs and corporate buyers.

The last 12 months Bitcoin has been up 100% and year to date it is 30%.

Michael Saylor says Bitcoin will likely grow 29% annual from now to 2045.

.

Bitcoin is valued at $2.3 trillion.

Palantir is valued at $400 billion.

Houses in some cities are valued at 11 times median income.

To support asset values, the government is more than willing to devalue the currency dramatically

The value of gold has gone up about $7 trillion over the last year.

The price of YAMS -- priceless.

Good luck finding an asset that will maintain its value.

Misc says

Good luck finding an asset that will maintain its value.

I just look at the average bubba in Panama City Florida and ask how is their quality of life or standard of living now compared to 5, 10, 20 and 30 years ago.

Do they live in a decent home ? Eat decent food ? Have enough and enriching leisure time ? Seem to have enough disposable income ?

Do they feel like they are financially underwater even if they live within their families and them living within their reasonable means ?

Never mind technology gains like internet with Pluto TV, cell phones, etc.

.

Mathematically the vast majority of people must lose value on their investments

Misc says

Mathematically the vast majority of people must lose value on their investments

If I lose value and my annual income from assets but I am still able to sustain the same lifestyle with no changes like going out the same amount of time to the same restaurants and getting the same quality and quantity of food, then it is essentially a wash.

But the posts about baby boomers passing on housing is interesting as far as the amount of housing and how that affects housing construction starts and housing affordability.

Just seems like all residential construction in Panama City Florida area has stopped since at least last year.
.

AD says

Just seems like all residential construction in Panama City Florida area has stopped since at least last year.

Yep, the Fed is simply not doing its damn job -- lowering interest rates

Misc says

AD says

Just seems like all residential construction in Panama City Florida area has stopped since at least last year.

Yep, the Fed is simply not doing its damn job -- lowering interest rates

For my wife and I we are fortunate we only have about $140,000 balance on our townhome, and its worth about $250,000. All time high price was likely $330,000 in early 2022 when the 30 yr mortgage rate was around 3%.

This current bubble with stocks (S&P 500 up 10% year to date, and look at the run up in 2023 and 2024) and Bitcoin has not caused hyper inflation, as the 12 month inflation rate is around 2.7%.

People not cashing out gains to go on shopping sprees including buying real estate to be landlords or to have as 2nd or 3rd homes.

Could be worse like Biden's +8% annual inflation rate.

Maybe the Fed is hoping housing prices stay flat while household income and wages go up 3% a year for the next few years.
.

AD says

But the posts about baby boomers passing on housing is interesting as far as the amount of housing and how that affects housing construction starts and housing affordability.

Young Boomers should already be retired or at least collecting SS. Or they'll just keep working. White collar jobs are easy as they're established. Couple phone calls and you sit on your ass as an attorney or similar. Blue collar you're working at a Home Depot or some other retailer. Again, an easy job. Pay is different, but you likely can just stay in your house unless it's a high property tax state. NJ and IL come to mind.

Many of their homes are paid off or at low interest rates. I think many are waiting to go to country club assisted living around 85 or they just die. I just don't see a boomer rush to sell and young people can't buy the homes. Maybe I don't hang out with poor people? Don't have a friend, client or peer that isn't making 6 figures as a family. Everyone here I know can afford $400-800k homes no problem.

"Bitcoin is no different than what gold represented for thousands of years. It is an asset class that protects you".
-Larry Fink, CEO of Blackrock and Co-Chair of World Economic Forum

https://www.bloomberg.com/news/articles/2025-09-03/trumps-cash-in-on-crypto-anew-as-american-bitcoin-shares-surge

Eric Trump owns about $550 million in Bitcoin

Misc says

Mathematically the vast majority of people must lose value on their investments

I think you are confusing 'gambling' with 'investing'. Thus your statement is accurate for Bitcoin and gold but not for true investments that have actual cash flows.

Investing is not a zero sum game. There is no 'house' that has to win by taking your money.

Mathematically every one can gain on investments, indefinitely.

stfu says

Mathematically every one can gain on investments, indefinitely.

I have an idea for you. Take $1 and compound that for say...2000 years at a 3% rate. Whaddya get ??? I'll tell ya. It's a number so large you can't understand it. And that's with a single dollar. Now imagine billions of people doing that with trillions of dollars to start with. Uh huh ! ! !

Misc says

Bitcoin is valued at $2.3 trillion.

Assuming every "coin" is still available and they could be sold for the going price. Market cap doesn't really apply to crypto.

Supply and demand. Crypto relies on the "bigger fool" principle. In order to make money on it you have to find someone willing to pay you more than you paid for it. Fortunately for the crypto speculators the supply of fools is huge.

Misc says

Take $1 and compound that for say...2000 years at a 3% rate.

$47,255,178,755,831,100,000,000,000.00

Onvacation says

$47,255,178,755,831,100,000,000,000.00

So how many earths on a monthly basis need to be created to achieve the next years 3% growth ???

Misc says

Take $1 and compound that for say...2000 years at a 3% rate. Whaddya get ???

Using 2000 years is absurd. Also, you are not lending in a vacuum as the bank loans out the money as a well. In fact, the initial depositor may even be spending job money to buy a product manufactured by a company that took a loan from the initial depositor's bank. Enough wealth was created to pay both sets of interest. This reminds me of the Marxist explaining that any worker at a car factory cannot afford to buy a car made there.

HeadSet says

Misc says

Take $1 and compound that for say...2000 years at a 3% rate. Whaddya get ???

Using 2000 years is absurd. Also, you are not lending in a vacuum as the bank loans out the money as a well. In fact, the initial depositor may even be spending job money to buy a product manufactured by a company that took a loan from the initial depositor's bank. Enough wealth was created to pay both sets of interest. This reminds me of the Marxist explaining that any worker at a car factory cannot afford to buy a car made there.

Of course, it is absurd. Financial systems collapse waaaaaaay sooner than that. This shows the absurdity that there can be perpetual increases in value. Right now the total household wealth in the US is over $170 trillion. US households in aggregate are saving a bit over $1 trillion per year. At 3% (people are taught that rates of return are far higher than that) would be an extra increase of $5 trillion per year. Figure inflation at about 3%...so that's another $5 trillion per year. Totaled up is a nominal increase of about $11 trillion per year. The GDP of the US is about $28 trillion per year.

The absurdity right now is that there is going to be an increase of $11 trillion this year with a $28 trillion economy. Sooner or later there's gonna be a collapse.

Funny thing is that the US is better off than any other country in the world.

MolotovCocktail says

I agree as I view Bitcoin just as a hedge like I do owning gold coins.

But if shit hits the fan, they will be worthless especially since the infrastructure for Bitcoin will not exist like a functioning electric grid, an exchange to transfer the Bitcoin to a buyer, etc

I agree the collapse and despair period before any inkling of recovery will be marked with a Mad Max Road Warrior mindset.

Bullets, canned food, and drinkable water is the desired currency as well as survival skills.

And I doubt I'd be around for the recovery after the collapse when gold will be valued as the next currency.

Speaking of hacking and taking down a network like an electrical grid or communication system, who is behind this hacking of all the airports ?

Chicoms using back-doors to Chinese-made computer systems that are used by the airports ? Is this a way for China to respond to (and retaliate against) Trump such as with the H1-B visa decision ?

.

My take on BTC ... it's a reflection of the tech sector, perhaps a Web3.x incarnation and thus, it'll have a much higher correlation to the Nasdaq100's bullishness (QQQ) over that of commodities and precious metals.

Here's a probabilistic function, using the QQQ as input, when it's trading (greater than 50% of the days within a single quarter) above its 132 day exponential moving average (the 6 mos metric or 2x business quarters), and Bitcoin. The correlation is somewhat predictive for BTC. In other words, it's yet to prove itself as some 'e-Gold' but more a Nasdaq lackey.



What it tells me is that if you want tech, buy the QQQ. If you want precious metals, buy gold or silver. If you simply want to trade, then trade BTC.

Otherwise, just settle down with Berkshire Hathaway.

Rin says

What it tells me is that if you want tech, buy the QQQ. If you want precious metals, buy gold or silver. If you simply want to trade, then trade BTC.

Otherwise, just settle down with Berkshire Hathaway.

BTC has been more and more adopted and it went past an inflection point when Larry Fink endorsed it with Blackrock's BTC fund.

Tech Bros seem to like it a lot since it is part of finance tech or FinTech, and Saylor says he expects BTC will appreciate around 30% a year for next 20 years.

.

AD says

he expects BTC will appreciate around 30% a year for next 20 years.

$20 million a "coin"?

Onvacation says

AD says

he expects BTC will appreciate around 30% a year for next 20 years.

$20 million a "coin"?

$115,000 today and in 5 years

(1.30)^5 x $115,000 = 3.71 x $115,000 = $426,650

One thing about those Crypto kids. They are not shy about the price they put on themselves. Tether (the company behind it not how much in assets it has) is trying to raise about $20 billion in new funds through a stock offering (private of course). It is shooting for pricing that would value the company at about $500 billion. Roughly 1.5 times the market cap of Bank of America, or more than Exxon/Mobile.

Now that Trump has given the all clear to allow 401-k money to go into Private Equity...well price it to the Moon baby.

https://www.cnbc.com/2025/09/23/tether-reportedly-seeks-lofty-500-billion-valuation-in-capital-raise-.html

Incredible that on 22 October 2025, Bitcoin bottomed in intraday trading around $103,000.

Now only five days later, Bitcoin is up around 13% from that intraday low.

blue-green-yellow-red stages of Bitcoin

https://www.blockchaincenter.net/en/bitcoin-rainbow-chart/

AD says

Incredible that on 22 October 2025, Bitcoin bottomed in intraday trading around $103,000.

Now only five days later, Bitcoin is up around 13% from that intraday low.

Exchanges and crypto billionaires are gaming the crypto world.

ElYorsh says

Exchanges and crypto billionaires are gaming the crypto world.

Markets ???? Manipulated ???? --- Oh, heaven forbid.