>>>If the goal is transacting business in a secure, anonymous, inflation proof currency, then there's no reason to sell them. They won't lose value, and if other people sell theirs, they will actually gain value.
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>>Well they were worth 5 bucks two years ago and now today they're worth over 100 bucks. I would think that would be a reason to sell.
>>Obviously there are people investing in this - heck I know someone that quadrupled her money doing just that in just a few months (she sold all she had to buy car for her teenager). I think the real question at this point should be - is there a bubble?
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>From other sources they recently crossed 1 american billion - as they were $2 at low time, imagining a 20 mil market heavyweight is easy to do. Rick's point that all possible Bitcoins could be mined in 30 years is new to me - and if true points to other correlations typically mentioned with expanding money amounts with growing economy, but would alter my take considerably. Economic theory behind creating more money at least partly "inflated", but not totally false for growing economies like BRIC.
>Bubble quite probable, but fueled by Cyprus and similar problems.
Inflation is outright robbery and theft. You have your money sitting in a safe and the value goes down and down and down. It can be described thusly. There are 100 bails of hay. A person writes a "money" for each (call it a "dollar"). Each "dollar" represents 1 bail of hay. So, 100 dollars, 100 bails of hay. Suddenly there are now 20 more dollars introduced into the system. The number of bails of hay have not changed, but the number of dollars representing them have. So, no longer is each dollar worth one bail of hay, but now each dollar is worth less. In order to buy all the bails of hay it would now take all 120 dollars, instead of 100 as it did before
Inflation is very bad. It's a mass crime against the people.
You NEVER want your money to inflate. It should be stable as controlled by some relationship to a fixed set of real commodities, such as was gold and silver (and mostly silver because it is more abundant) before we left the standard.
We don't want money systems which provide the opportunity to easily hoard by a few designing men or else we wind up with systems like the Federal Reserve System and International Monetary Fund (which is completely enslaving nations and peoples today).
There's a video on YouTube about this:
http://www.youtube.com/watch?v=iDtBSiI13fEAround 19:00 into the video, he explains that there have been various systems of money throughout the ages, including one called a Tally Stick (which represented 25,000 pounds and was used for about 700 years). Systems of money or exchange are what we agree them to be. The same is true for Bitcoins. If I accept Bitcoins, and you accept Bitcoins, and enough people accept Bitcoins, then they are real money.
