vidacode.github.io
Hope someone finds it fun!
So the only question is: what's different between Y thing and horse betting? Did you have enough information at Z time to know you should have invested? Or are you just wishing you could have predicted the future?
Anyway, that's the framing I use to counter the regret of not getting into any given asset that's appreciated a lot in a short period: BTC, tesla stock, etc.
But “better judgement” said that it’s a currency it shouldn’t appreciate so why bother unless you want to actually use it?
So if there’s regret it’s because many of us feel almost penalized for applying better judgement. It’s like you’re rewarded for stupidity. Not a single person I know and actually respect invested in crypto, and half brained idiots I know have become millionaires. So yeah this is not like horse betting.
I don’t know any millionaires from crypto. I know people who are loud when market is up and very silent when it’s down. May be they were millionaires on paper at some point. Highly doubt they sold everything at the right time and became actual millionnaire. But sure, it did happen for many.
I mined a "bunch" back in 2011 or so, lost the hard drive with the keys on it in the years since, didn't really think about backing it up, because of course it's not worth anything, etc, etc.
If I had that drive today, I'd be a millionaire. But also, if I had that drive in 2013, there's absolutely no chance I would have held it. I would have sold it for a few hundred bucks and been elated.
A friend got a great job, if I hadn't failed job interview X I would have a great job. Later you find your friend hated that job; your experience of the job you "missed" is unknown, etc. It's also part of survivor bias.
What would it have taken in advance for you to not cash in that early bitcoin that you didn't get (or lost) and didn't expect would become anything? Is that something you can prepare yourself for now? Is it worth preparing?
Deciding you have a financial portfolio, and framing that one part of it is risky, and another part is experimental, and then placing early bitcoin ownership as part of the experimental portion of your financial portfolio, and then later (as it becomes a larger percentage of the total) as part of the risky portion, and then looking for more situations that seem like it could fit this approach could possibly be one takeaway ... but it seems like a stretch.
You also have to avoid patterns that cause long-term failure but are misleading in the short term, such as buying and selling to realize gains, but then repeating ("it worked once") buying and selling until you have an overall loss. Like gamblers do. Sometimes they win, somethings they lose, but they lose overall by not ever stopping.
Also, how do you know someone who seems to have succeeded isn't simply in the "looks like success" portion of long-term failure? How would you avoid it?
Just because someone was actively monitoring crypto & then missed out as the price went from $1 to $10,000 still doesn't mean they have misjudged. Even if crypto is the future - and I've become convinced that it is for privacy reasons - there was still scant evidence of that during Bitcoin's rise. There have been no great arguments circulating to explain why someone should buy in and a lot of the people who made money look like they just got lucky.
It's like if you see a friend betting a bunch of money on a long-odds horse and then winning. You exercised good judgement, but he won anyway. Do you feel penalized for applying your better judgement in that situation?
The only thing that really matters is: was it the right decision given the information you had at the time?
YES, I knew about Bitcoin a couple of years before I invested in it.
YES, I could have made a significant return during that time.
YES, I should have investigated it further at that time, instead of focussing on other things.
YES, I made a risk/return analysis at that time, and felt that the risk of investing was too high, even if I didn't do my due diligence.
Everyone, at every time makes a decision to either invest or not invest in something at any point in time, even if that decision is subconscious. I can feel bad about making that decision, but I did make it. My risk/reward appetite just wasn't high enough.
It's all very easy in hindsight, the trouble is to predict it accurately. A better way to look at this is to say that some people got lucky and some didn't.
Of course the problem with humans is, if they cashed out at say 25K, they'd have regrets when BTC hit 30K-35K, and since they have money they'd be tempted to join in again...
Horse betting has been established to be just that: Betting (I have no clue if that's really true, no offense to the hn horse racing crowd). There is no big institution money that says otherwise. There are no startup wizards working in the field. Nobody claims they are going to change the world.
Crypto on the other hand is sold as the future, and the people who miss out on the future are losers. The tech is really complicated, you don't understand what's going on, but, clearly, some very smart people do and they are convinced.
The point being, it's a lot easier to disregard horses than it is to disregard the future.
[Citation needed]
Even applying a steel man, it is not convincing. Don’t defer to “smart people”. Do your own research from first principles.
Off Track Betting near me is also always packed with people betting on horses. No one there though is foolish enough to create an ideology around horse betting and I am sure most know deep down the house always wins.
One could argue that a log scale should be the default for any graph showing a price over time, though it would confuse people who don't know what a log is. In this case it might make it easier to compare what happened around 2018 with what happened around 2020-2021.
There's no warning of this, but if you look at the start date of the chart you'll notice it may be much later than the date you thought you had picked
edit: With that bug, choosing a period of 1 week is the way to get the longest possible time range for the chart, about 7 years
One observation: The volatility is terrifying, but the multimillion dollar gains are interesting
I mean, probably professional traders have tons of these to do back-testing, but it would be nice to have something simple that people could use to check basic strategies.
Just as an example, when I was still into BTC my "strategy" was to buy $100 very month, and in the end of the year I would sell just enough to get my money back and only if the average price went up in the year. It worked well for the bull years, and losses (if I was forced to realize them) were capped at $1200/year.
I think a tool like that should be good not just for crypto, but also to help those understand that sensible investing is not about timing the market and picking the right lottery tickets.
what is the "period" parameter for?
There SOME assets which are not worth trillions, so no.
> in ANY time period
There are SOME time periods which any given assets decline in value. Over an infinite time scale, the survival rate of everything is zero. But of course you're speaking about selecting the optimal interval in that time scale.
The problem is we are not immortals, infinite time scales is irrelevant. Many are born too late to be Warren Buffet.
https://en.wikipedia.org/wiki/Greater_fool_theory
It made me sell all my crypto (luckily at a profit), and I have not looked back.
In general, anything that turns a raw material of some sort into a more refined product (be it iron ore into steel, steel into machines, or electrons into advertisements) is adding economic value into the system. By doing that work, the total net wealth of humanity increases. The economy is positive-sum, and so investing in anything that's correlated with the economy as a whole should be worthwhile.
Bitcoin doesn't work that way. Trading Bitcoin isn't adding to the total net worth of humanity. Mining Bitcoin arguably could be, because the ability to make transactions has some value, but the practical value of those transactions is less than the value of the electricity, computer hardware, and pollution that go into making them. Speculating on Bitcoin does nothing productive; it's zero sum. Net-zero systems are nearly indistinguishable from gambling unless you have insider information.
One that comes to mind especially for Bitcoin is that it “could” act as a global store of value, independent of any one geopolitical power. Many countries lack stable and non-corrupt currencies, and many people in those countries cannot trust putting large sums of money in their economy, for fear that they will be taken away from them. If BTC stabilizes in value sufficiently, people in those countries could use it as a store of value—like gold, but easier to obtain. Id argue that the idea of having a digital store of value does increase the productivity of the world, because people don’t have to rely on inefficiently hoarding gold, or paying fees for buying gold in the stock market.
Of course, it's very unlikely that anybody in this thread bought them because in reality we are looking for gains correlated to hype/market performance/inflation/interest.
It seems to me the only difference is whether the speaker is predisposed to not like the thing in question.
This leaves you with a surprisingly small amount of assets. Collectibles probably.
I think the epitome of greater fool is probably NFTs. Unlike a real piece of art you don't actually own anything unless additional value is conferred to you by owning it from the issuing entity, like say legal copyright over the referenced piece in question (if its art).
What is it that you actually own when you buy a physical art piece? Is it the actual canvas and the paint on top? If so then that is definitely not worth hundreds of thousands of dollars on its own. Or, more likely, is it the fact that you own the original, and that the artists could never make an exact replica, unlike with NFTs? Even though you can make an exact replica with NFTs, everybody agrees on the original, and therefore the exact replica has no value. With art you could make a near perfect replica, but everybody would still agree upon the original, and therefore the original is the one with real value. IMO NFTs and physical art are still very similar.
i.e your dumb ape picture could now suddenly become furry porn.
Real art (assuming proper steps to preserve and protect it) will remain as it was while it's in your care. You -own- it, you can take it where you please, store it how you please, etc.
NFTs aren't like real-art at all, they are at best analogous to in-game collectibles - entirely subject to ToS but even those are less predatory and ponzi-like than NFTs.
If you're referring to stocks and bonds, those can have objective value in the form of dividends and coupons.
The value at any point in time is determined on the exchanges. I think a better question is what changes the value, creates the volatility, and so forth.
The value is the net benefit (including future benefit) that it provides.
McDonalds creates value by providing convenient and consistent hamburgers, and entry-level jobs.
Bitcoin, I've been told, creates value by allowing easy transfer of funds. Thus the value of Bitcoin should be based on how Bitcoin transaction costs and externalities (lack of regulation is both a plus and a minus) stack up against other money transfer systems.
Crypto has only existed in this funny money monetary environment. Good chance it all collapses if interest rates are too high by the time of the next BTC halvening (iirc around mid 2024) and there aren't enough bids to perpetuate the "next cycle will be bigger than the last" pattern.
But at the same time, its also true that the awful central bank management that prompted the creation of BTC is also at its peak awfulness right now.
So really, wait and watch.
Don't gamble. It's not a productive use of your time. It's also a vice. Spend your time doing something that is valuable and productive. Don't fritter it away or one day you will probably regret it.
Your second part there gives a very good hint to your problem in the first part. Of course, in some sense there is some value in facilitating child porn and other illegal activities and some value in burning fossil fuels for mining (the value may be positive or negative). I am still pretty confident that if you just round "actual value" to zero - and use the possible error to keep you away from shorting the market - that is in the long run the valuation that gives you the best quality of life.