Bitcoin Mania Continues

[ecosophia]

You know that a speculative mania has entered its final stages, and bodies will start plummeting from windows in the measurably near future, when people begin doing the most obviously idiotic things to pile into the bubble. 

With Bitcoin, that moment has arrived. According to this recent article, people are using their credit cards to buy Bitcoin and carrying the balance. So -- ahem -- they're taking out loans, in effect, at whatever rate their credit card happens to charge, to buy a speculative investment, and paying the interest in the fond hope that their Bitcoins are going to make them rich anyway. 

In the immortal words of Keith Brand, "Dear God, this is going to end so badly." 

Any of my readers who have money in Bitcoin, or any other cryptocurrency, in any other spirit than the one that leads people to blow lots of money on slot machines in Vegas, will want to be ready to wave goodbye to their investment...

Comments

Physicality

[ferngladefarm.blogspot.com.au]

Hi John Michael,

The problem that I have with these crypto currency things is that I can not touch them or see them. Now I would be comfortable with those two problems if I could exercise some level of control, but no, can't do that either. The question I have about these things is: what are they?

Cheers

Chris

Re: Physicality

[ecosophia]

Well, the same thing is true with most money these days -- and even the money that takes the form of pieces of paper or lumps of metal is just a set of abstract tokens. Giambattista Vico pointed out centuries ago that that's what happens as civilizations age: they get further and further into abstraction, until the abstractions become completely detached from the underlying realities and down the whole thing goes.

As for what cryptocurrencies are -- well, that again begs the whole question of what money is, and that probably deserves a blog post.

Re: Physicality

[(Anonymous)]

Have you taken a look at Debt: The First 5000 Years?

Re: Physicality

[ferngladefarm.blogspot.com.au]

Absolutely! People appear to have lost track of the concept. Interestingly, I read about the recent Consumer Electronics Show over in casino land. What interested me about the stories were the size of the budgets being thrown around by companies. We are talking billions. All that says to me is that money ain't worth what it used to be! My thinking on the matter is that policies expanding the money supply are subject to diminishing returns. Oh well...