Monthly Archives: November 2013

One Person Sold 195K Bitcoins Today Making $161 Million

The price of bitcoin has gained a lot since last week. Right now the average price of a bitcoin is trading around $800. Bitcoin is being traded right now because bitcoin exchanges are always open. Normal currency exchanges are closed in the weekend.

Today something interesting happend on one of the exchanges. There was a massive sale by one person of 195k bitcoins. The person who did this transaction made a total of $161 million. The Washington Post thinks the transaction was probably done by Bitstamp to reshuffle some of its accounts it holds for people. Like a bank transfering money from one vault to another. 195k bitcoin transaction 195k bitcoin transaction

A transaction like this is very rare because there are only 18 bitcoin accounts in the world that have more than 100k coins in it. The table below is coming from a Paper done by two people from The Weizzman Institute Of Science in Israel.

Biggest bitcoin accounts

Biggest bitcoin accounts

The transaction was so big that the average transaction volume in bitcoins surpassed the transaction volume of an average day on paypal.

Bitcoin transaction volume

Bitcoin transaction volume

Dutch House Prices Have Remained Flat The Last Few Months

Dutch house prices have remained flat the last few months. The price index has been stuck near 85 since April of this year. According to CBS year over year home prices dropped 4% last month. Home prices are now 20.3% below the record of August 2008.

Prices of existing owner-occupied dwellings

CBS: Prices of existing owner-occupied dwellings

CBS: Price index of existing owner-occupied dwellings

CBS: Price index of existing owner-occupied dwellings

Corrected for inflation house prices haven’t moved either as Mathijs Bouman showed with another chart on Twitter. According to the chart below home prices corrected for inflation are at the same level as in October 1999. In a post I made about Dutch house prices in June of this year I also noted that the price, corrected for inflation, was the same as in October 1999. While we can speculate about what home prices will do next right now it looks like we have found a temporary bottom at the very least.

Dutch house prices corrected for inflation

Bouman: Dutch house prices corrected for inflation

The S&P 500 Is Still Valued Below The Average Forward P/E Of The Last 30 Years

JP Morgan Funds Twitter account posted a nice graph on Twitter today showing that, even while the S&P is trading near an all time high, this rally could go a lot further. The S&P 500 is still trading below the average forward P/E of the last 30 years according to the graph. According to this chart the S&P 500 is fairly valued and we are not experiencing some kind of bubble. Of course earnings will need to keep growing in the future to keep justifying a higher price.

JP morgan S&P 500 forward price equity graph chart 20 years showing fair value

The Dow Jones Index Has Only Been Up For Five Straight Years Three Times Earlier In History

The Dow Jones Industrial Average Index (Dow Jones Index) has had an incredible run the last five years. Coming from a low of 6500 in February 2009 the Dow Jones Index has been making new all time highs a few times since this year. At this moment the index is currently trading near its all time high of 16,000.

The index has ended every year positive for five straight years since 2009. As the image below shows, this is actually a very rare occurrence which has only happened 3 times before in the last 100 years. It will be interesting to see whether or not the Dow Jones Index will make another year with a positive return next year. The image below shows that only one time before the Dow Jones managed to pull off six consecutive positive years.

Performance of the dow jones industrial average after five postive years

The record for positive years in a row for the Dow Jones Index is 9 years. This occurred from 1991 till 1999.

For further reading: here is a list of yearly Dow Jones Index returns from 1975 till 2013.

Inflation In the US Is At The Lowest Pace Since 1965 If You Exclude The Short Deflationary Period In ’08/’09

Vincent Foster shared a chart today on Twitter that shows that inflation (CPI) in the US is now at the lowest point since 1965 if you exclude the short deflationary period in 2008 and 2009. Inflation is at this moment only 1% year over year.

inflation CPI in US at lowest in 50 years if you exclude 08-09

Bitcoin Crashes From $900 To $450 In Two Days

After hitting a high of $900 on sunday night bitcoin has now fallen to a price of $450. A 50% drop from the top so far. Some people have been writing that bitcoin can go as far as $10,000 or even $1 million.

Below is a chart of the last three days where you can clearly see the crash to $450. (Chart: clarkmoody)

Bitcoin price chart 900 top to low 450