Saturday, December 2, 2017

Weekend Bitcoin news

Just for shits and giggles:

FT Alphaville - why Bitcoin futures and a shoddy market structure pose problems. Wow, so they're initiating an official futures market in Bitcoin, and doing it badly? That's kinda a top signal....

CNBC - North Korean hackers stealing people's bitcoins. Gee, it's sad that you need to rely on a government to protect your private property rights, eh?

Reddit - I am a time traveller from the future here to beg you to stop using Bitcoin. Just cos it's funny.

Wednesday, November 29, 2017

See, this is why America can't have nice things

Oh, Donald. The brain damage that just keeps on giving....

NY Times - Trump retweets British neo-Nazi videos. Don't call them far-right. Britain First is ex-National Front. They are Nazis.

And how does The Donald respond?

He apologized!

Haha jk no, he doubled down:

CNN - White House defends anti-Muslim Trump tweets.

Actually, that's not all of the title:

CNN - White house defends anti-Muslim Trump tweets, AND SAYS IT DOESN'T MATTER IF VIDEOS ARE REAL.

This crazy, wacky post-truth world we live in....

Tuesday, November 28, 2017

More Bitcoin hype

Even Business Insider is writing about it....

BI - bitcoin price shoots over $9900. Quotes, with commentary:

As for how high bitcoin will go, billionaire businessman Mark Cuban told Business Insider the coin will continue to push higher as retail investors pour into the space and folks with large bitcoin holdings continue to treat it more as a collectible than a currency.

"The number of people opening up new accounts and buying bitcoin, even fractionally, is skyrocketing," he said.

Dunno why they interviewed Mark Cuban instead of someone who knows something, but he raises a point.

What happens when they run out of people to open accounts? NASDAQ 2000 happens, is what.

"Yet the people who have it as a true store of value have no reason to sell it as long as demand continues."

Yeah, and then what?

See, one problem is that the bitcoins in your account aren't worth $9900 (or whatever it is as you're reading this).

The marginal bitcoin is worth $9900. And the price of the marginal bitcoin will be different when there are more available relative to demand.

The stuff in your account is only worth what you can sell it for. That's what a "true store of value" means, Mark.

Since the list of merchants that accept bitcoin is still relatively small, so-called holders (or hodlers as they are referred to in bitcoin circles) don't have many places where they can spend their coins, either.

"They can't spend it, so they keep it," Cuban said.

That doesn't make it a store of value or an asset, then. It makes bitcoin a collectible.

"If big holders don’t sell and the number of Coinbase users keeps going up, the sky is the limit."

Um, no, the sky isn't the limit. Earth has a finite investor population, and there is a finite level of reasonable portfolio allocation to bitcoin.

Total value of all the world's gold is $7.5T or so. Total value of all the world's equities is $80T or so.

If total blockchain cap goes over that, then it will have become unbelievably silly. And, parenthetically, it'll also be hilarious to watch as a significant portion of the world's wealth then vanishes overnight.

I don't think it can get that far, but then again I believe humans aren't, in the aggregate, total idiots.

Monday, November 27, 2017

Bitcoin to break $10,000?

Bitcoin is apparently breaking $10,000 tonight.

Which again indicates that people will buy fucking well anything.

John McAfee has only 5000% more to go to save his own penis.

That's eDigital-level multiples right there.

And, by the way, nowadays you buy EDIG on the pinks.

The Amazon effect

Tim Taylor - the Amazon effect. Interesting possibility, that retail prices are kept low by Amazon prices.

I guess you could interpret it as brick-and-mortar stores having pricing power due to geographic monopoly, and that power disappears once all sellers are forced to compete in the same marketplace.

Quick note on gold and miners

So normally, these past couple years, investors have vomited gold and gold miners in December, as part of the typical yearly loss capitalization and port rebalancing.

That alone is reason to think they'll do something different eventually. The market tends to go in the opposite direction to what everyone expects.

There also aren't that much in the way of losses in the gold miner market his year, unless everyone has bought at the tops. Most of the volume in GDX (easily 60-70%) has been in the $22.50-$23.50 range this year.

Also, GDX is threatening a crossover of the SMA(50) under the EMA(20). When that happens people will take it as a signal to dump. But the gold action this morning suggests that might be a fakeout: a pop above the SMA(50) (i.e. GDX=$23.10) may signal a failed crossover attempt, which is a good buy signal.

Frankly, selling has been decelerating since September (actually it's decelerated all year), and there's a nice intermediate bottom forming in the chart.

And at this second gold is up to $1296. $1300 is a nice round number where something interesting should happen.

So the GDX now looks very interesting to me.

There, I just jinxed the gold miners.

Sunday, November 26, 2017

Once again, the lower class gets screwed

Bloomberg - the retail apocalypse is only just beginning.

Apparently, it's not so much an Amazon problem, it's an idiotic leveraged buyout after idiotic leveraged buyout problem:

Until this year, struggling retailers have largely been able to avoid bankruptcy by refinancing to buy more time. But the market has shifted, with the negative view on retail pushing investors to reconsider lending to them. Toys “R” Us Inc. served as an early sign of what might lie ahead. It surprised investors in September by filing for bankruptcy—the third-largest retail bankruptcy in U.S. history—after struggling to refinance just $400 million of its $5 billion in debt. And its results were mostly stable, with profitability increasing amid a small drop in sales.

Making matters more difficult is the explosive amount of risky debt owed by retail coming due over the next five years. Several companies are like teen-jewelry chain Claire’s Stores Inc., a 2007 leveraged buyout owned by private-equity firm Apollo Global Management LLC, which has $2 billion in borrowings starting to mature in 2019 and still has 1,600 stores in North America.

Just $100 million of high-yield retail borrowings were set to mature this year, but that will increase to $1.9 billion in 2018, according to Fitch Ratings Inc. And from 2019 to 2025, it will balloon to an annual average of almost $5 billion. The amount of retail debt considered risky is also rising. Over the past year, high-yield bonds outstanding gained 20 percent, to $35 billion, and the industry’s leveraged loans are up 15 percent, to $152 billion, according to Bloomberg data.

Even worse, this will hit as a record $1 trillion in high-yield debt for all industries comes due over the next five years, according to Moody’s. The surge in demand for refinancing is also likely to come just as credit markets tighten and become much less accommodating to distressed borrowers.

The numbers are tiny from a debt standpoint, though, so it's not going to really hit the broader economy except in terms of working class people getting fucked yet again.

Don't go holding your breath for inflation.

Yeah right

Google called to say that I was PROBABLY going to be named “Google/Blogspot Blogger of the Year", but I would have to agree to an interview and a major photo shoot. I said fine, as long as there's hot chixxx.

Because I'm read more than other econ bloggers like Bonddad or Branko Milanovic, or even One Red Paperclip, Google Maps Mania or Vegan Lunchbox.

Yeah right.