5 ms·
> Scarce simply means is in short supply, but prices aren't determined by supply alone, they are determined by supply and demand You can't predict demand, nob
by ObserverNeutral 5y ago
> Scarce simply means is in short supply, but prices aren't determined by supply alone, they are determined by supply and demand
You can't predict demand, nobody can. So all things being equal (demand being unpredictable) you are better off holding something which is in low supply.
People are absulutely scared to death about inflation. It's deeply rooted in our brain and rightfully so. The first governments would dilute their citizen by adding lead to coins and reduce the silver %.
The same thing has been going on for millennia.
This is the reason why people hate inflation and have a strong preference for deflation.
- kybernetikos 5y ago> You can't predict demand, nobody can. You can't predict demand perfectly, but you absolutely can predict demand. In fact that's exactly what everyone is doing when they speculate. There are also processes that help you predict floors to demand - e.g. that you must pay US taxes in US dollars.
- ObserverNeutral 5y ago> You can't predict demand perfectly, but you absolutely can predict demand. In fact that's exactly what everyone is doing when they speculate. If you want to make money you have to be pretty accurate in your prediction. Nobody knows what Bitcoin or the S&P will do tomorrow. It's all rooted in psychology and we don't understand anything about it. We don't even know where ideas come from