Bitcoin is not a bubble?” Various articles on this topic, many people may see the eyes almost callous. Accordingly, these articles are usually listed a lot of examples, the “tulip bubble”, “South Sea bubble”… .
But the past, at best, just explain the bubble, development and rupture process. And now, in fact there is not much comparability.
But in economics, the “bubble” in fact is not a clear definition, and we strictly to judge a thing is not a bubble is actually very difficult.
Of course, now a lot of economics academic will also use the word “bubble”, but these papers are generally give yourself a definition, and then use this definition to the reality. For example, many of the papers said:
“The rise of a product or asset prices in a market, it is higher than the normal price deviation from the value (difference) is the bubble.”
A simple point is the deviation from the value of cash flow discounted total “, this definition is very reasonable at first glance, but the key problem is that we take an expectation on the future value only, and this expectation is subjective, is the faith, but not the objective probability.
For example, the Jingdong is not a bubble economy? Although expensive for the big fourth China Internet, but look at the company’s ability to make money, Jingdong from the outset in losing money, and up until 2017, the Jingdong has never had any profit for the year. That is to say, from the Jingdong was founded, investors have been kept in the money to Jingdong.
So to support the Jingdong for so many years has been burn in the end is what? Is the investor’s beliefs. Because investors believe that the development of Jingdong to bring greater returns in the future, past losses are temporary, and it is necessary. As long as the belief that investors do not change, then the Jingdong can take the money has been burned down.
See here, I think many people may ask, “this is not a Ponzi scheme?”
In fact, the strict sense of the Ponzi scheme is a concept afterwards. For example, you run a project, when the end of the project, the money you borrowed more than you can generate profits, we can say that this is a Ponzi scheme.
Of course, some Ponzi scheme is relatively easy to judge, does not need to wait until the end. This is because the profit model is very simple, and it is not sustainable. For example, now a lot of a block chain coat MLM coins, such as former chairman of the NASDAQ Madoff investment management. Such projects often rely on asymmetric information, once the scam was exposed, investors can convert belief is very fast, like the Madoff foundation, you don’t know how many people rush, but once was exposed after the investor’s belief will transfer from the collective “optimistic” to “pessimistic”. So this time we can say, the bubble burst.
But for the vast majority of financial assets, the market for its future value and no consensus, mostly according to its historical performance and other data to estimate. This time, the market for the same assets will also appear a variety of beliefs”. If enough investors are optimistic beliefs “, that the sustainable profit model, and can bring greater returns in the future, then the financial assets is not a bubble, or that it is hard to say how much foam.
Only when the financial assets are fully mature, we engaged in to sum up, to see how much it produces value discount, then the buyer is not more than the value of the money to buy it, if it is, then the bubble has appeared.
Here, I want to emphasize that, in fact the economics itself does not have the facts, but a reasonable explanation given in the phenomenon and appear in social and economic behavior. So many people often criticized economists is: a whole talk, are not in the next crisis is what comes, only after the analysis.
In fact, the economics of towering magnificent building, itself is built on shaky ground. Economics is the basis of macro economics, micro economics and two basic assumptions:
First, the assumption of rational man. Assumption of rational people (economic man). In order to self serving motivation, try to chase and maximize their own economic interests with minimal economic cost. Second, complete information assumption. Complete information. The market of each individual engaged in economic activities (i.e., the buyer and the seller) has complete information about the economic situation of the.
Not only is the science of economics, I believe that see the two assumptions that people will instinctively begin to suspect that even faith may be collapsed, that she had learned a pseudo science”.
If further learning, you will find that macroeconomics and microeconomics incompatible like water and fire. Micro economics with Waals as the core of the theory of general equilibrium analysis model; Keynes macro economics but with macro unemployment disequilibrium theory as the core, with the price rigidity hypothesis and the three psychological law as the basis.
In short, macroeconomics neither looks reliable assumptions, and not derived from micro economics, microeconomics and even with two skins. So many years, many economists have, trying to “patch” the economics, microeconomics and macroeconomics reconcile, but for decades and what no significant results, even by the laugh:
“Like oil and water as well as the fusion.”
Micro economics is on the beach of the building, while the macro economics is castles in the air. Not to mention the economics of accurate predictions of the future, even the autonomous do not, have internal opposition to such a degree.
So, some experts, engage the blockchain, from some software to listen to a few books on economics, or to learn a few new terms, is full of excitement., confident, really do not know where the confident. You really see the economics about each stroke, estimated that you will hardly wished to live..
Of course, say, is not to say that economics is really superfluous”. In today’s society, economics is a very effective tool.
You know, economics is all social subjects in mathematics was the highest, while a subject of mathematical degree often indicates the degree of its development.
Newton established the Newton calculus physics, classical mechanics system; Einstein elliptic geometry physics established general relativity. The highest degree of physics and mathematics, and achieved maximum. The level of mathematics economics even more than the level of mathematics in many natural sciences but also high.
And, the most universal mathematical economics or discipline.
By using the method of economics can be transformed to many other disciplines, created the interdisciplinary people find everything fresh and new. For example, the 1992 Nobel laureate Gary Becker, the ideas and methods of economics, the study of social, political and legal system, originally do not belong to the field of economics, and created a large number of branches, as the new economy politics, economics, religion and economics of language.
The topic is a bit far, pull back to say “bubble”. Just say so many economics, we should be able to find the basic economics is set up under the framework of rational expectations, but the public impression of the “bubble” but is more or less and some non rational behavior together, so in fact, the economics of the “bubble” and mass media said “bubble” in fact, there is a difference between.
In addition, the current age, to the performance of the company, to the development of the country, many of the so-called “objective facts”, a credential is essentially used to update their “faith”. And now the potential social financing ability and flexibility than any time in history, it also greatly stimulate economic vitality and creativity, but also created unprecedented prosperity today.
However, any “faith” to support the economy, when the “faith” from the transfer to the pessimistic optimistic, bubbles occur; and accordingly, when the “faith” to transfer from the optimistic pessimistic when the bubble inevitably burst.
In the past, the rise and fall of an economy tend to continue for many years, because true wealth agglomeration is not easy, but many, “laurels” can also eat for a long time. But now, between the company’s rise and fall is often passed, their life cycle has been greatly accelerated.
In any case, today we have been walking in the fast lane of faith economy “, enjoy the” faith economy “brought unparalleled flexibility and mobility, there is no possibility of back.
Our economic future, is bound to be a “bubble stage” and “stage of rupture” economy. Bitcoin, the same can not escape this cycle.
There are a lot of money, a circle mouth is the circle of wealth for outsiders to imagine, but all the total market value of currency as clear as noonday encryption in coinmarket.cap written on it, until today is about $124 billion, which accounted for more than half of bitcoin. But when the highest total value of the entire money market but also $about 800000000000 encryption.
It looks really pretty much, but how much is the time of the Internet bubble in 2000? The Internet bubble from the ten month peak of fall, carrying on the total loss of $five trillion. That is to say, an economic bubble burst in 2000, because of its light bubble disappeared, has now than the encryption of the currency market more than thirty times, so think more?
In this world of wealth is a lot of people can not imagine, so that human beings have the ability to finance by “faith” to create wealth. Although bitcoin has experienced almost barbaric growth, but still only a very small.
So, let alone like multimedia write bubble how, even if it is zero, the current financial system can have much impact? What’s more, between the encrypted digital currency and other financial assets is relatively independent, more infectious co..
The bitcoin from 2013 onwards often make people feel the bubble burst, because it appears to support the operation of the financial mechanism of the world behind the rough with a savage, show the way to the general public.
All those in the traditional financial markets, covering behind the delicate model and decent white gloves, suddenly in the crypto currency market, in a brutal way naked from the show never access to all these operations, people exclaim: so there is such a thing!
In fact, such a thing has been, will always exist.