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RE: What's the right move for Steemians?
She really did make $20. It's true she could have made more by playing differently, but she has $20 more than she would have if she never heard of Apple. She started with $60 ($50 to buy at $50 and $10 she used to buy again later) and now she has $80.
Of course if she's paying anything in fees she's screwed, so hopefully she's a Robinhood investor.
I still think accumulating Steem is a good plan for me, but if the price goes down much more I'll have to switch some of my effort into earning USD and buying, rather than earning it here.
Mary spends 50, sells at 60 makes 10 bucks profit..
She rebuys at 70, now that means she's negative 10 in her holdings. She had to spend 10 more.
Mary's balance -10
Stock goes up another 10, she sells... she's effectively at 0.
Edit.-
The assumption here is that she could go above her budget of 50 to even continue.
Now I'm going to make a post called The controversial Mary
That's not how this works.
Mary starts with $60 cash. I'm sure that's not all the money she has in the world but it's what she's investing today.
She spends $50 on AAPL and keeps $10.
She sells AAPL at $60, now she has $70 cash.
She spends $70 to buy AAPL and now has no cash.
She sells AAPL at $80 and now has $80.
Oh, to clarify... Mary starts with only one stock of Apple... only 50 monies....
That was her investment budget.
It works the same if you want her to start and end with stock. She spends $10 in cash but ends the day with a stock that's worth $30 more for a net gain of $20.
You are forgetting the fact that she is breaking her budget. She had to extract money from outside her budget.
So it would be a Steemian selling his steem, then having to spend more bitcoin to buy the same amount of influence he/she had.
That's the message. So, we could say... yes you have the same amount of steem, yes it's worth more... awesome.
But... you had to take from your BTC holdings to do this.
You are using the example incorrectly if you're trying to illustrate some sort of point...
She never sells at a loss in your example, it's quite simply 20 dollars gained.
This part is the part that drives the point my friend...
It's all fungible.
If I spent $10 in BTC to move from $50 to $80 in Steem I can just sell off $10 worth of Steem to buy the BTC back, now I have $70 worth of Steem. The fact that I would have $80 worth of Steem if I'd just wandered off after the first buy doesn't matter to my overall profit except that I didn't do a very good job of maximizing it.
Am I in a worse position than someone who just stuck around in Steem? Sure. They made $30 and I only made $20. But that's just FOMO in more complicated language.
hahahahha yes you are confusing people tho....
i'll explain it to charity bot in a different way.
The end goal is to have more Steem, not to have more USD valuation of Steem.
...
Hi meno. Glad you clarified as I also worked out she made $20.
I wrote a more palpable explanation to the reasoning. As it would apply more to us steemians.
She had $50 and got $60. That's $10 profit.
She spends $70 (the initial investment of $50 + her $10 profit and another $10) and sells for $80. So she's was able to get back the $10 she invested earlier and that makes her break even...?
you got it... she broken even.
I thought I was going crazy haha ;).
Steem rule #7892: If you question whether you're going crazy or Meno is, there's a good way to bet.
Well, it's no secret my branium has some glitches in the code. But there is a method to my madness.