From the wiki:

The price feed for a certain asset (say bitUSD) is derived as the median over all published price feeds not older as 24 hours.

By its nature, that would mean that it lags behind.

It's really hard for shorts to execute because of the way that the price feed lags behind external market prices.

In an up market:
- Price of bitUSD increases in terms of BTSX
- Feed lags behind so people cancel their short positions
- Only shorts that execute are those who exited their positions late, and they end up eating an immediate loss.

In a down market:
- Price of bitUSD decreases in terms of BTSX
- Feed lags so buyers cancel buy orders, or sellers can go under the feed price
- Almost no shorts end up executing

I think this is one of the reasons that bitUSD cap is so low right now, because short sales are necessary to increase the number of assets.

I think that lagging price feeds are preventing an increase in market cap for bitassets.  My understanding is that short orders are critical to the creation of additional unit of bitassets, but the lagging price feeds severely limit the incentive and execution of short orders.  Is this intended behavior?

Having only a few buyers is the demand-side equivalent of having a monopoly or an oligopoly because buyers have zero to little competition, so I would argue the current situation is a (temporary and naescent) market failure.  I guess it depends on what you mean by "right"; that's an abstract question, similar to discussing what defines a rational agent.

Suffice it to say, I think that the price will go up provided that people are made aware of the existence of keyID/DNS.

What about a invite only subsection. Something not based on post count but actual content of the user or a willingness to actually help.

I think it would not be a good idea to actually close off the forum all together, it would just isolate people that want to get involved but are new.

I would argue that any closed off section would be nearly equivalent to completely closing off the forums from a 'transparency' perspective.  If people really want to keep prying eyes from seeing their conversations, they should pick a different vehicle for communicating rather than posting on internet forums.

Instead of restricting the forums, I would argue that some minor reorganization of the forums would make it easier for new users to access:
- I think that the forums should be reorganized or renamed in a manner that makes more sense rather than closed off. i.e., the current "Bank & Exchange" forum is under the DAC category, so it should really be the bitsharesX forum.
- The development forums should, in my opinion, be put in a subforum under each DAC.
- I had no idea that KeyID was going to be the vehicle for DNSshares until I happened upon that forum, so I would rename that KeyID/DNS or something more clear.

I can think of a couple more (minor) changes, but the essence of the reorganization should focus on paving the groundwork for more DACs to start popping up, and directing people to the proper subforum for discussing a particular DAC.

I see the problem, although I don't know if it exactly mirrors the bitasset yield scenario.

How about this model for yield?:

You could calculate the yield on a per-block basis, since as far as the network is concerned, the resolution on confirmed transactions is per-block.  If you want to encourage people to hold an asset, you could have a ramp-up period for an increase in assets, i.e., your share is diminished for the first XXX blocks until it is earning at full potential.  Any decrease in your accounts would cause an immediate and proportionate decrease in the yield (i.e. no rampdown).

This would:
- Provide incentive for people to hold funds to maximize yield.
- Provide disincentive to withdraw funds, which would immediately reduce yield.
- Since the share is recalculated on a per-block basis instead of at the time of withdrawal, there's no strategy for increasing your share based on timing your withdrawal.

I'm concerned that if the rules are applied in series, then somebody could potentially put in a short order for a very small amount of bitUSD with a ridiculously high collateral ratio and a similarly high price limit, and that would prevent all shorts from executing.

I tried two orders:

Initial conditions: The price feed is at 30.8290 BTSX/BitUSD, there is a buy order for 0.7009 BitUSD at a price of 30.2029BTSX/BitUSD, the lowest sell order is at 30.2777 BTSX/BitUSD

Order 1: I put in a short for 0.7009 BitUSD at a price limit of 30.2029BTSX/BitUSD with a collateral ratio of 75 BTSX/BitUSD (which was not the highest collateral ratio on the books).  It didn't execute.

Order 2: I put in the same order, but this time I made sure it had the highest collateral ratio.  It didn't execute either.

I'm okay with the low volume for now.  I kind of expect it.  I've hedged my position on BTSX by buying into bitUSD the amount that I contributed to AGS to guarantee a return (assuming the peg holds, of which I'm reasonably confident).  In fact, it's better than a simple hedge, since the interest generated on it will make it worth substantially more.

I think that once the backend code gets sorted out and the BTSX marketing engine gets rolling, BTSX will gain more value.  We will see a lot more people securing there gains by buying into bitUSD, and the market will become much more liquid.