Quote from: Limetless on July 17, 2012, 05:32 amThe cause of the BTC rise is down to the basic laws of supply and demand, nothing more complicated than that.A truer word was never said! At the risk of being thought uncool, it should be understood by all that this is a zero sum game. That is: if you speculate and win B$, somebody else loses that B$ in exact proportion.Yes, Bitcoin has inflation, but so too does *any* other currency. Strictly speaking you have increasing prices, so it may sound daft to talk of a zero sum game, but you must understand folks, that it is a zero sum game *of exchange value*. You have twice as much money in USD? That's awesome, but you could just as easily have had half as much money in USD as the older vendors on here are well aware of.If you speculate, you will lose. At best, get even. If you get lucky and stay out, then you could win, but that risk is enormous. If you want to do it intelligently, study the lore of arbitrage. The law of the Efficient Market Hypothesis is obeyed here in the realm of Bitcoin, just like it is in the housing market, in the commodity market, in the stock market, in the bond market...The majority of rapid fluctuations you are seeing are connected to speculative activity rather than fundamentals.It is only over the course of a year or more that you can say whether a currency is becoming weaker or stronger. In the short term, human psychology drives markets rather than economics.