Topic: Would the failure of Bitcoin lead you to reconsider your assumptions? (Read 10309 times)
November 17, 2013, 02:24:14 AM
hahaha good one. Note it is only a flea on the USD elephant ass in terms of market cap.
November 17, 2013, 02:14:50 AM
Too big to fail now...
November 17, 2013, 01:37:29 AM
Bitcoin is not deflationary, monetarily speaking. It is always increasing in quantity, at a decreasing rate, until it stops increasing in quantity. Thus, it's always inflationary until it becomes constant - ie neither inflationary nor deflationary.
If the money supply of Bitcoins -shrinks- then it could be considered deflationary. But unless a bunch of people are throwing their wallet files in the ocean I don't see that happening.
Thus, if Bitcoin fails, it neither proves nor disproves that inflationary currencies are superior - it is after all an inflationary currency itself. Clearly, humans are so used to using inflating currencies that when they see one which inflates much slower than national fiat monies, they cry out that it's deflationary!
If the money supply of Bitcoins -shrinks- then it could be considered deflationary. But unless a bunch of people are throwing their wallet files in the ocean I don't see that happening.
Thus, if Bitcoin fails, it neither proves nor disproves that inflationary currencies are superior - it is after all an inflationary currency itself. Clearly, humans are so used to using inflating currencies that when they see one which inflates much slower than national fiat monies, they cry out that it's deflationary!
Incorrect. Consider the Quantity Theory of Money.
M x V = P x Q
When you distribute in a way that 90+% of the coins end up in <10% of the hands, then you have created deflation, because velocity V is in the equation. Read this link to understand why. Hint: wealthy don't spend much of their net worth, they invest to accumulate more coins (net worth).
November 17, 2013, 01:25:10 AM
Quote from: Bram Cohen
Will the Bitcoin fiasco make Libertarians realize they know diddly about economics? No, it will not.
http://twitter.com/#!/bramcohen
Not all Libertarians are goldbugs. I am a minanarchist (small government) which is a subset of Libertarian, and I am no longer a goldbug although I was briefly (yet had serious doubts while I was and took me some time to figure it out).
November 17, 2013, 01:20:44 AM
There are plenty of examples of how price deflationary economies grow and thrive. In fact, it is inflation that stops growth because it creates malinvestments.
The problem is that keynesians ignore the empricial evidences and keep repeating the same nonsense. If Bitcoin works or it does not it wont be due to price deflation.
The problem is that keynesians ignore the empricial evidences and keep repeating the same nonsense. If Bitcoin works or it does not it wont be due to price deflation.
Economies don't thrive because of the (small decrease or increase in the) money supply, they thrive (and increase productivity very fast causing deflation) because the government is small. Here is the very simple math and QTM model which refutes your popular goldbug delusion.
November 17, 2013, 01:14:18 AM
the failure of Bitcoin due to competition with a more successful form of crypto-currency would obviously only serve to strongly reinforce my assumptions as to the merits of the basic idea.
Bitcoin's failure due to some kind of unilateral implosion would definitely lead to reassessment.
Bitcoin's failure due to some kind of unilateral implosion would definitely lead to reassessment.
Since you didn't state if you view the "merits" positively or negatively, your statement appears to be ambiguous.
I assume the first sentence means you view competition as one of the positive aspects of decentralization. I agree.
However, you could also mean that competition means crypto-currencies are inherently inflationary, which is what I hear as a criticism from my silverbug friends.
November 16, 2013, 01:53:47 PM
NO it would lead me to a Alt coin, heh.
November 16, 2013, 12:18:13 AM
Sorry to wake the dead, but I just saw this now.
A thing, in this case, a "fiat dollar" cannot be evil since morality only applies to beings with volition.
A thing, in this case, a "fiat dollar" cannot be evil since morality only applies to beings with volition.
June 10, 2011, 01:42:28 PM
That's not evil? That's not inherently evil?
Nope, but it sure as hell is something I'm willing to fight against.
June 10, 2011, 07:35:58 AM
I'm going to go out on a limb here and say that fiat currencies are not inheritly evil.
Rather the people who control the currency and inflate with reckless abandon without respect or concern for those who hold the currency that are evil. The rules have to be written in stone... or backed by gold.
And there is nothing I can think of that will provide something more stone-like than a extremely strong hashing algorithm.
So long as the rules are written in stone and cannot be changed, we are far safer.
Rather the people who control the currency and inflate with reckless abandon without respect or concern for those who hold the currency that are evil. The rules have to be written in stone... or backed by gold.
And there is nothing I can think of that will provide something more stone-like than a extremely strong hashing algorithm.
So long as the rules are written in stone and cannot be changed, we are far safer.
So we have a State that says "use this paper as money or we will be unhappy."
if you don't do it, they will then order you to do it.
If you still don't do it, they will arrest you.
If you resist arrest, they will shoot you.
If you go to prison and try to escape, they will shoot you.
Meanwhile, they print more money, robbing you of purchasing power.
That's not evil? That's not inherently evil?
June 10, 2011, 04:49:14 AM
I'm going to go out on a limb here and say that fiat currencies are not inheritly evil.
Rather the people who control the currency and inflate with reckless abandon without respect or concern for those who hold the currency that are evil. The rules have to be written in stone... or backed by gold.
And there is nothing I can think of that will provide something more stone-like than a extremely strong hashing algorithm.
So long as the rules are written in stone and cannot be changed, we are far safer.
Rather the people who control the currency and inflate with reckless abandon without respect or concern for those who hold the currency that are evil. The rules have to be written in stone... or backed by gold.
And there is nothing I can think of that will provide something more stone-like than a extremely strong hashing algorithm.
So long as the rules are written in stone and cannot be changed, we are far safer.
But this is like saying, dictatorships are not inherently evil, its just that dictators abuse. Well, that is the issue, and that is why dictatorships or fiat currencies are bad.
June 09, 2011, 08:58:56 PM
Rather the people who control the currency and inflate with reckless abandon without respect or concern for those who hold the currency that are evil.
The IMF trades gold certificates on the market that will never be redeemed effectively dropping the price. I'm not touching gold. Silver is rarer anyway.
June 09, 2011, 03:02:57 PM
I'm going to go out on a limb here and say that fiat currencies are not inheritly evil.
Rather the people who control the currency and inflate with reckless abandon without respect or concern for those who hold the currency that are evil. The rules have to be written in stone... or backed by gold.
And there is nothing I can think of that will provide something more stone-like than a extremely strong hashing algorithm.
So long as the rules are written in stone and cannot be changed, we are far safer.
Rather the people who control the currency and inflate with reckless abandon without respect or concern for those who hold the currency that are evil. The rules have to be written in stone... or backed by gold.
And there is nothing I can think of that will provide something more stone-like than a extremely strong hashing algorithm.
So long as the rules are written in stone and cannot be changed, we are far safer.
June 09, 2011, 02:17:58 PM
-
June 09, 2011, 01:18:33 PM
First of all please let me take a stance regarding fractional reserve banking: accepting deposits, putting a fraction aside and lending out the remainder is the standard way any and all banks operate, regardless if they use gold, green paper or bitcoins. The notion that fractional reserve banking is somewhat only possible if enabled by a central bank is a Zeitgeist conspirationista type of fallacy.
Any and all banks is a very strong statement. There are lots of other services banks offer.Only a central bank issued paper currency allows such a bank to guarantee its deposits. Under hard money, maturity mismatching will result in the bank failing.
An honest bank can offer current accounts for a fee and time deposits with interest which is then lend out as fixed-term credit. It can also offer brokerage services like the ability to buy bonds directly, with all associated risks and benefits.
A hard currency will prevent moral hazard and make it simpler for customers to actually understand what's going on. What's wrong with that?
Fractional reserve banking is popular, because it makes people feel richer than they actually are, but this leads to lots of problems like too cheap credit, malinvestment and capital consumption.
June 08, 2011, 04:30:55 PM
Doesn't Bitcoin respect the Equation of Exchange which is a tautology? Can a tautology be reconsidered? Is a tautology an assumption?
June 08, 2011, 04:28:25 PM
The computer industry experiences constant deflation. Does nobody buy computers?
To answer your question, yes- the failure of bitcoin for economic reasons would cause me to reconsider my economic assumptions. Would the success of bitcoin cause you to re-examine yours?
To answer your question, yes- the failure of bitcoin for economic reasons would cause me to reconsider my economic assumptions. Would the success of bitcoin cause you to re-examine yours?
June 08, 2011, 04:19:54 PM
If the sum of goods/service/other increases and the sum of the medium of exchange remains constant - won't deflation in terms of the medium of exchange's value ratio against the sum of goods/services/other follow? Isn't this deflation suppose to be allocated pro-rata to the sum of the medium of exchange holders and not to a select few? Isn't it an indication of productivity if the medium of exchange's value ratio against the sum of goods/services/other devaluated? Shouldn't everybody on a pro-rata basis be rejoicing that humanity's productivity has added to the goods/services/other that they can exchange for the medium of exchange they are holding because they sacrificed earlier joys by holding on to it? Didn't gold as a medium of exchange had a fairly constant quantity of existence - although it could be divided down to the molecular / atomic level - ensuring equitable wealth distribution to all holders of the medium of exchange automatically? Did this happen without interest rate adjustments? Does everybody get and pay the same interest rates? Who benefit from imbalances in usury?
June 08, 2011, 04:12:38 PM
Confiscation via inflation is as bad/good as confiscation via taxation, a distinct political issue.
On the other hand, deflationary currency is provably impossible for any sensible definition of "currency".
On the other hand, deflationary currency is provably impossible for any sensible definition of "currency".
June 08, 2011, 04:04:33 PM
Did the dropping of the Gold standard start the taking from Jack (pensioners, savers and holders of the money supply) to give to John (labor) for a job well done for the taker (democratically elected government, elected by the labor majority triumphing over the saving/depositing minority) ?
Did the dropping of the Gold standard ultimately end up nearly bankrupting everyone including majority labor, and minority pensioners, savers and holders of the money supply, after years of dwindling true value money supply?
Did the dropping of the Gold standard ultimately end up nearly bankrupting everyone including majority labor, and minority pensioners, savers and holders of the money supply, after years of dwindling true value money supply?
Jump to: