<p>Im quite uneasy of people touting BTC. Its fantastic if you mined it for free or got it at $3, as RR says. I dont track Mt. Gox but several times during the year I would read news saying Mt. Gox is down due to a DDOS attack or it is unavailable for withdrawal. I prefer the FDIC and NCUSIF insurance my banks and credit union provide. BTC is an extremely volatile currency. According to this news, your BTC can disappear into the twilight zone. [Chinese</a> Bitcoin exchange DISAPPEARS, along with £2.5 MEEELLION ? The Register](<a href=“http://www.theregister.co.uk/2013/11/12/bitcoin_gbl_hong_kong_collapse/]Chinese”>Chinese Bitcoin exchange disappears, along with £2.5m • The Register)</p>
<p>“If you are a victim of cybercrime or fraud, it would be covered by your bank. But who do you go to if someone steals your bitcoins? Or if an exchange disappears or bank collapses? Who is going to cover you?” said Raj Samani, McAfee’s chief technology officer.</p>
<p>I don’t even know what Bitcoin is. (online currency?) And the price would be the stock in the company that created the online currency or the currency itself? Whatever it is, it sure reminds me of tulip bulbs.</p>
<p>The price is in the desirability of the currency itself. The idea is there’s a known supply, with a roughly known growth rate (currency is introduced as computers crunch out a particular algorithm), so it should be less susceptible to government fiddling.</p>
<p>Krililies, apparently right before the big run up early in the week a few of the other exchanges weren’t open for trading. There are a few other electronic currencies people have come up with recently, and I know those are experiencing a similar boom. One of the issue with these currencies is whoever designs them always winds up with the lions share of the first bunch of coins mined. I know one of the alternates to BTC owner’s coins are already worth over a million for him. Quite a few people are viewing this as a sort of pyramid scheme.</p>
<p>Have been reading up on peer-to-peer lending. The sites seem to recommend that investors make at least 200 loans of about $25 apiece or so. It seems like a PITA to try to eke out higher interest rates. Anyone with thoughts about this? Prosper and Lending Club appear to be the leaders in the field, but H and I are thinking it sounds too much like work to constantly be looking to buy loans and offload any where the borrower is at all late in repaying.</p>
<p>Would love any experiences or insights.</p>
<p>Am also skeptical about Bitcoin and other on-line currencies. It does seem very much a ponzi/pyramid scheme. What value is being given? What regulations are there? What happens when things to “poof?” Heck, we could create our CC coins and all be CC coin founders.</p>
<p>Part of the idea for BTC and the others is in anonymous, untraceable transactions. Prior to the Silk Road being shut down (as well as a few other similar sites), that was a fairly desirable trait for people into various illegal past times. There’s a whole bunch of security things that are supposed to verify things happen when things are supposed to happen, but there’s a lot of responsibility on the end user. If you lose the password to your wallet, it’s gone for good (as are those coins). If your account gets hacked, too bad, there’s no way to figure out where it went. At the moment it’s not a currency meant for casual use; it’s aimed at people that want to use it for a particular purpose.</p>
<p>That said, I still think it’s all crazy and couldn’t see myself getting into any of them other than mining.</p>
<p>Bogle heads and others are urging extreme caution if trying peer to peer lending–some steps below junk bond and sort of like charity where you MAY get back a bit. </p>
<p>H is thinking of doing some bit coin mining, but I don’t know enough other than vague uneasiness.</p>
<p>Are you talking about a pure buy, hold, rebalance periodically basket or a basket from which you would make selections according to technical indicators?</p>
<p>I posted this on another thread, but this is definitely the more appropriate thread to ask. Anyone familiar with the stock EHTH, eHealth? They are the company that runs eHealth-Insurance.com. Very high PE (over 150), but they have tripled in the last year, and seem to have a booming business ahead of them, especially if the govt can’t get their act together as far as the website.</p>
<p>Is anyone here nervous about the stock market? It seems kind of obvious that the zero interest rate policy and the buying of copious amounts of govt debt are major factors for the steep increase in stock prices. I know the returns from the market is pretty irresistible and these low rates are not going anywhere, but I have this gnawing feeling…</p>
<p>People are seeing bubbles everywhere and have the same gnawing feeling that you have. People are nervous about the market and waiting for corrections. Bullish investment sentiment is dropping. This is why the market is going up and will continue to go up. The stock price increase isn’t that steep, it is fairly orderly. I would continue to stay long and maybe buy some more on any dip in the near term. I would also hedge positions as nobody knows where the market is going and protection is cheap. Its a good idea to keep some dry powder just in case good opportunities arise.</p>
<p>I have a somewhat different account of the dynamic. Helicopter Ben vastly expanded the money supply while at the same time making sure that safe or relatively safe investments essentially yielded nothing. The money had to flow somewhere. Unfortunately, rather than flowing the kind of uses that actually had the possibility of adding to the real wealth of the economy (infrastructure, new manufacturing plants, etc.) it flowed into the stock market, inflating the price of stocks, which aids the economy only through the trickle down “wealth effect.”</p>
<p>Bottom line is that this year, diversification was a bad thing. Your returns depended entirely on the question of what percentage of your wealth was invested in the stock markets of developed countries. Even real estate securities and emerging markets, which are usually highly correlated with developed country stocks, didn’t do very well.</p>
<p>Is it a bubble? That’s just semantics. How long will it last? Not a clue, but I am uneasy.</p>
<p>EMM1, My view is similar to yours. I have noticed that my portfolio is not keeping pace with the “market”. I have constructed a dividend portfolio, so I am overly weighted in some non glamorous stuff. There is a lot of “chasing performance” going on in the market, if you look at the stocks that are going up many are hot, racy names that in many cases don’t even make a lot of money and are trading at very high multiples. Chasing performance works for a while and makes everyone involved feeling good. Fund managers buy the latest hot stocks and the buying makes these stocks go up even more. It can go on for a while… until it stops. I don’t know whether to use the current rally to lighten up or to completely load up for a continued short term rally. The second strategy of course assumes I get out shortly thereafter. I think I will lighten up some actual positions, and then buy some options on SPY and maybe QQQ as well. That way if the market keeps going up I will make some money but if it all falls apart I limit my loss.</p>
<p>"if you look at the stocks that are going up many are hot, racy names that in many cases don’t even make a lot of money and are trading at very high multiples. "</p>
<p>A lot of those racy names have already corrected.</p>
<p>Haha, holy cow, BTC over $1170 now. This is truly absurd.</p>
<p>A while back there was a fad of people using their Playstation 3 to mine for bitcoins while they were idle. I imagine a lot of those people are cashing out to buy their PS4s right about now.</p>
<p>Even thinking back to when BTC was fairly low, maybe in the 50s, I remember seeing people running calculations on rate of return if they were to build a computer exclusively for mining coins. At the time I think the strategy was to get a fairly beastly multicore processor and two of the most expensive video cards possible (around $400-$500 each). Including electricity and the expected slowdown in the rate of BTC mined, payback was around the 1-2 year mark. At current prices you’d be paying that rig off pretty quickly.</p>