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The wikipedia article lists several competing and complementing explanations without elevating one as the one and only true one. In systems with strong feedback
by heisenbit 9y ago
The wikipedia article lists several competing and complementing explanations without elevating one as the one and only true one. In systems with strong feedback it is very hard to know what is cause, what is effect and what was just a coincident.
- runeks 9y agoDon't rely on Wikipedia to tell you what the true explanation is. From the linked section: > If the price rose above 100 guilders, the speculator would pocket the difference as profit. If the price remained low, the speculator could void the contract for only 3½ guilders. The Dutch government enabled risk-free speculation in tulip options contracts (formerly futures contracts). How could the price of such a contract not rise under these circumstances?
- dnautics 9y agoSounds an awful more like the ways leverage (for wealthy speculators) is protected in our society. That has implications bforbthe stock market more than it does Bitcoin. Do we know about how much Bitcoin trading is done on leverage? I suspect it's relatively low (as securities go).
- runeks 9y agoI don’t see any parallel in our currency financial system. If you know an investment where losses are limited to, at most, 3.5% and potential profit is unlimited, please let me know.