The Israel Deception

Is the return of Israel in the 20th century truly a work of God, or is it a result of a cosmic chess move to deceive the elect by the adversary?

Showing posts with label psychology. Show all posts
Showing posts with label psychology. Show all posts

Monday, May 8, 2017

Money psychology: Is Bitcoin price already too high for desirability as a currency?

The advent of Bitcoin, as well as rise of the blockchain and its growing number of different crypto-currencies, is bringing forth a great debate on whether these constructs of digital money are the wave of the future for consumers, savers, and investors.

But there are a few very interesting things that are bing missed by most individuals in the Bitcoin eco-sphere, and these are the psychology of money, and the fact that as Bitcoin has now crossed over $1600 per coin, and is being forecast to possibly go as high as $4000 by the end of the year, has the crypto-currency priced itself out of the general market?  And perhaps even more, has it already destroyed its psychological value to individuals as a viable form of money?

A layman's definition of what money is can be determined as this:  An idea backed by confidence.  And for something to be considered a medium of exchange (money) it must have the intrinsic properties that all monies have (store of value, divisible, fungible, portable, etc...), but it also must have the confidence, be it forced (by government), or voluntarily accepted (by critical mass of consumers and retailers), to act as a recognized medium of exchange.

Thus as the price of Bitcoin in dollars as well as other currencies skyrockets due to speculation and investor sentiment, the question that has to be asked is whether or not Bitcoin has priced itself out of the ability to become an accepted currency, simply by the fact that the majority of individuals today can only afford to purchase fractions of the currency, rather than whole Bitcoin's themselves.

Picture this.  A person has $20 they can afford to use to purchase Bitcoin, so they create a digital wallet and go through an exchange to buy some of the crypto-currency.  Now this individual understands the basics of monetary division when it comes to dollars as they have used quarters, dimes, nickles, and pennies for nearly all of their lives.

But at today's price, $20 will buy that individual only .0125 of a Bitcoin, which in physical terms would equate to a penny and a quarter of a penny.  So psychologically, that individual has exchanged $20 for a penny.


Now of course in the crypto-currency realm .0125% of a Bitcoin is not valued at one cent, but you can see the psychology of this as people used to dealing in round numbers and limited fractions in their money now have to go outside the box to try to come to the understanding that it will be unlikely they will ever own a single full Bitcoin since more than half of Americans alone cannot even afford to pay $500 if a sudden emergency required them to come up with those funds in addition to their normal budget.

Then of course there is the reality that the amount of retailers who deal in Bitcoin is still quite limited, and the marketing of Bitcoin as a viable medium of exchange in the mainstream is almost negligible.  And also the fact remains that if people don't see Bitcoin promoted in the mainstream media, or shown in some viable application from the commercial advertising they are programmed to trust, then Bitcoin, as well as other crypto-currencies, will remain as fringe ideas and concepts, or as simply a construct traded in financial markets under the guise of a speculative investment.

Sunday, February 26, 2017

Could millennial snowflakes be the catalyst to keep the U.S. from eliminating cash?

If there is one thing to be said about millennials it is that they are very emotional about their activism.  And all one has to do is look over the past couple of years at their push for 'safe spaces' on campuses, rabid protests over a myriad of different topics, and the rejection of many status quo policies that have been at the core of America's government over the past 20 years.

So with central banks, sovereign leaders, and elitist academics all pushing hard for the elimination of physical cash in the world's monetary systems, an interesting irony is coming to the surface where today's millennials could be the catalyst for protecting the economy from going 100% into a digital system.

Image result for psychology of cash
If millennials are supposed to be the first generation going mostly cashless, they are making the move halfheartedly.
Millennials still rely on cash — 80 percent of millennials carry greenbacks. And 42 percent still write checks, according to the Accel + Qualtrics Millennial Study 2017.
And that could be a good thing, as some advisors say a cash diet is the best way to pare down debt. 
The study corroborates other recent findings that technology is not overturning conventional ways to pay for things, even as millennials flock to mobile payment apps like Apple Pay and Venmo. 
Sophia Bera, a millennial who founded Gen Y Planning and is a member of the CNBC Digital Financial Advisor Council, said most of her friends carry some cash, but she rarely sees them using it as the first option to pay for things. It's mostly cash for emergency situations, or cash for tips.  
"When I use Venmo it feels like magical money," Bera said. "You forget that it is money, like any money, and that is bad." 
The financial advisor highly recommends cash to people trying to get out of credit card debt or for sticking to a budget. "A weekly cash amount is good," Bera said. "Take out $200 every Friday and when it is gone it is gone. ... It's a lot harder to drop six twenties on a dress than swiping a card. People don't buy flatscreen TVs with $20 bills."
Bera said switching to cash, even for just a few months, can help people reign in spending, and is especially helpful for those trying to get out of debt. - CNBC
Psychology has always played a huge role in how people see and respect money.  And all one has to do is look at a casino, which exchanges your currency for casino tokens (chips) because they know that gamblers are more than willing to spend these tokens in greater quantities than if they were playing a table game using real money.

Additionally, people became inured to accumulating high levels of debt when all they had to do is pay a paltry minimum amount which they could afford despite the fact they were actually increasing their debt levels through the interest compounding on that debt.

For a generation of Americans who suddenly had a wakeup call from the massive amounts of student loan debt they accumulated, recognizing the power of money by desiring to use cash instead of credit is a life-changing paradigm.  And even with America's youth being much more attuned towards using technology for nearly everything in today's society, their lagging in the transition to a cashless digital society because they realize that spending cash over credit is extremely beneficial to keeping oneself out of debt, could be a serious factor in hindering the establishment's agenda towards making all of finance one without physical money.