The raspberry pi, however awesome, does not have the power to run youtube well in the default distro. Even if you don’t have X installed, a simple script allows you to take a youtube video’s URL and instantly start streaming its video!
To use this, you will have to get a working omxplayer and the awesome youtube-dl library. If you are using debian, they should be available using apt-get.
#!/bin/bash
#Different formats are: 18-360p, 22-720p, 37-1080p
omxplayer -o hdmi $(youtube-dl -g "$1") #Standard def
#omxplayer -o hdmi $(youtube-dl -f 22 -g "$1") #720
#omxplayer -o hdmi $(youtube-dl -f 37 -g "$1") #1080
Voila, instant streaming youtube videos!