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Mark my words. I am 100% sure I am correct.
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I am sorry for taking your time, but how to be so sure of something? Being sure of something garantee you are correct? I sometimes am sure of things and then it turns out I am wrong and then I feel stupid. I beg, if not take too much of your time, to teach me how to be more sure and correct? I think I will be able to accomplish a lot of things, if I devise a system to be sure of things. Please help me.
All of us have made failed predictions (myself included). And your question is very humble and astute. Thank you.
I am confident of two predictions:
1. Crypto-currency can't become a unit-of-account without stronger anonymity (i.e. in an altcoin) or unless Bitcoin becomes effectively controlled by the government(s) and they decide then to give it legal-tender status. The latter can happen if most activity will be done offchain in banking institutions, which toknormal was advocating upthread.
2. Severe global economic collapse before 2020, mostly likely quite evident by 2016ish.
The reason I'm very confident of #2 is because due to the invention of central banking we are at a 200+ year high in debt, at a level that has never been seen before at 313% of global GDP (376% of developed country GDP if we exclude emerging markets), $223 trillion of debt, $1000 trillion of derivatives, and $1000 trillion of government promises to the people which are yet to be funded. That simply can't sustain and at the same time the computer is going to automate 47% of existing jobs according to Oxford University research, thus massive technological unemployment coming until the youth learn to adjust to the new paradigm. On top of that, Armstrong's computer models agree. Note although central banking was
invented at the end of the Middle Ages,
it didn't become globally ubiquitous until the 20th century. Central banking is what enabled the debt and socialism above to grow so humongous, because it prevented defaults and corrections by being the lender of last resort.
The reason I'm very confident of #1 is because (to re-summarize what I've written in the two Buffet threads) Max Weber's canonical definition of government (i.e. society!) is "a monopoly on force". Autonomous money goes to battle against the entire concept of society. And from a technical and human nature perspective most people prefer everything easy, thus they will not prefer to use decentralized on-chain paradigms. They will prefer to do what toknormal suggested which is use offchain accounts at banking institutions. Bitcoin currently has no compelling advantage over credit cards and paypal for most
consumers (thus very few merchants accept BTC exclusively), thus it will require offchain accounts to make it more competitive. Offchain accounts is centralization and fractional reserves, and/or government regulation and oversight. We see this happening before our eyes (Mt.Gox!), yet most are still in denial?!
Thus I conclude (as much as I hate it) to admit that the old fart is correct. But I think the smart people who want to survive this coming crisis (because governments will be taxing and confiscating all the wealth due to the severe global economic collapse) will adopt an anonymous altcoin which has decentralized on-chain exchanges, payment services, etc.. And I think Buffet will be wrong about that. The quality of the implementation will determine if this is realistic or not.
Add this:
Something big is coming? 4 bankers suicide last weekNecessity: The Argument of TyrantsAlso:
You better save your money, there are going to be much bigger wars with larger stakes before 2020.
This is only the beginning. Don't even imagine you will stop it in Ukraine, because the problem driving increasing strife (e.g. see China becoming aggressive in ASEAN) is global bankruptcy. That is what is forcing every man's hand. Russia's economy is also threatened and the gas pipeline to Europe passes through Ukraine.
Did you know years ago Armstrong's computer predicted the rise in strife to come in 2014? Did you know early in 2013 Armstrong pinpointed Ukraine and Russia threatening Europe again?
http://blog.mpettis.com/2014/03/will-emerging-markets-come-back/#comment-21244Even the IMF has admitted that global debt is at a 200 year high. Central bank was
invented a the end of the Middle Ages, but it wasn't ubiquitous until the 20th century. In addition to the $223 trillion debt which is 313% of global GDP, there is something on the order of $quadrillion of derivatives and another $quadrillion of actuarial promises to society which are unfunded. Central banking being the omnipresent lender of last resort is the cause of humongous monstrosity, because it prevented liquidation of TBTF throughout the 20th century.
For example the emerging markets are heavily laden with corporate dollar bond debt because due to ZIRP the fixed income investments (e.g. pensions) were forced to seek higher returns abroad. Thus emerging markets are mathematically betting short the dollar. Thus as capital flees the peripheral (i.e. non-reserve currency) markets (to include Europe and Japan by next year), there will be massive strength in the value of the reserve currency (the dollar) in 2015 and concomitant doubling in the NYSE index. This would put a spiraling (the toilet bowl) pressure on emerging markets, because they will be repaying debt with weakening local currencies. This will spiral until they exhaust dollar reserves and default on external debt, because once you take away the bubble veneer, none of them have positive current accounts. Argentina is approaching default the earliest probably in 2016.
Central banking is an abject failure.
But there is currently no better solution on tap. The fundamental issue and potential solution is much deeper than I can insert into a blog comment.
