Oh god... the comment section. Everyone's an economist and bitcoin expert! I think Bitcoin, by it's design, will always have massive ups and downs. There's a large enough group of people that want to use it to keep it from completely busting, and as it's deflationary by nature that will always draw in the vultures to run up the price, cash out, and make a quick buck. But mark my words... I see government regulation of Bitcoins future. Limits at the bank level of how much people can put into exchanges or pull out, taxation, or the flat out banning of it's use if it can't be controlled.
Kind of misses the whole point of bitcoin - there can be no central control of it, governmental or otherwise. My take on it is that this sort of hypervolatility is what you get when you take a steroidal monster like the current banking economy and give it what is essentially a hobbyist monetary system to play with. I think Bitcoin is "decentralized currency 2.0" and that it'll be 3.0 or 4.0 before it really goes mainstream. Bitcoin is the junk bond of Forex and as such, will be the plaything of aggressive traders rather than rank-and-file investors.