The New Economy

[BaalChatzaf]

Bitcoins are the new computerized tulip bulbs.

Please see http://en.wikipedia.org/wiki/Tulip_bulb_mania

[deanwins]

BallChatzaf, Mine a block and get a reward of 25 bitcoins on the original Bitcoin ledger... and then come back and tell me that bitcoins are just like tulips. Invalid.

[moralist]

Greg,

You are only looking at the price discovery phase where Bitcoin's value is going up. There is a component of truth to what you are saying, some people who hold bitcoin do recommend that others buy it merely for the purpose of being able to sell their holdings at a higher value.

Of course. It's classic Ponzi.

Never the less, I would not say that this is the primary reason why many Bitcoin users buy bitcoins. After the price discovery phase, Bitcoin's value will become more stable, a much slower slope, whether up or down.

Fine. Get back to me when it levels off.

But whatever. It seems that you do not acknowledge the value of having a decentralized digital currency.

I don't... but I do acknowledge the real value of what I own outright.

So it doesn't matter what I say to you for your own personal investment choice.

That's right. Even if I could make money I won't "invest" in Ponzi scams because they're unethical. Instead I invest in my own business because that is how to honestly earn money by working to serve others. I have been doing it this way for all of my life. And because values are more precious than dollars, I never have to worry about money for the rest of my life.

In fact, for many who do not understand it, its probably not a wise decision to make a large purchase of bitcoins. You do not accept that it is good, but you do accept that it should be permitted to exist in a free market economy correct?

Cheers,

Dean

Sure, Dean...

...because it does not matter to me what other people do. I go my own way regardless of what anyone else does, because everyone gets exactly what they deserve as the consequences of their own actions just as I do.

Greg

[deanwins]

Greg,

...because it does not matter to me what other people do. I go my own way regardless of what anyone else does, because everyone gets exactly what they deserve as the consequences of their own actions just as I do.

This makes you my friend, despite our differences of conclusions on Bitcoin. Cheers.

[Selene]

Wow!

Does that mean you two are going steady?

[deanwins]

Wow!

Does that mean you two are going steady?

Are you asking me to ignore you?

[Selene]

Wow!

Does that mean you two are going steady?

Are you asking me to ignore you?

That would be your choice correct?

[deanwins]

Yes, it would be my choice. But know that your behavior influences my choice. Unlike the invalid bitcoin:tulip relationship, consider this one: Selene:The boy who cried wolf

[Selene]

Yes, it would be my choice. But know that your behavior influences my choice. Unlike the invalid bitcoin:tulip relationship, consider this one: Selene:The boy who cried wolf

Not a problem.

[Backlighting]

Ammunition can always be used as a value to be traded, particularly if it's in the most popular calibers. The market for it is huge.

[moralist]

Greg,

...because it does not matter to me what other people do. I go my own way regardless of what anyone else does, because everyone gets exactly what they deserve as the consequences of their own actions just as I do.

This makes you my friend, despite our differences of conclusions on Bitcoin. Cheers.

I'm glad of that, Dean...

...because neither of our different bitcoin conclusions has any real effect on each other's personal life. I fully expect the dollar to eventually return to its intrinsic value of zero. Same with the bitcoin. While what I own will continue to be consistently useful as usual.

Now if the creep who ran off and hid after writing and releasing the bitcoin code had pinned its value to the value of an ounce of gold, that would be an honest currency, and he wouldn't need to hide like a freaking coward.

But instead you have the holder(s) of the first millions of bitcoins gotten for virtually nothing at the top of a classic Pyramid scam, with everyone downstream trying to convince and to recruit new (suckers) to extend a larger and larger base to support the part of the pyramid which is underneath them.

Al Gore had a similar idea:

CARBON CREDITS

Jeez... even just talking about this makes me feel like I need to go take a shower.

Greg

[Selene]

Al Gore had a similar idea:

CARBON CREDITS

Jeez... even just talking about this makes me feel like I need to go take a shower.

One of the most despicable humans on the planet...

I remember his disgusting use of his sister's death by lung cancer speech at the Democratic convention.

This from a family that made it's fortune growing tobacco with government subsidies...

I saw him for what he was in that speech.

A...

[deanwins]

Greg,

If you pin a currency to gold, then you have to have a pile of gold to back it. Such a pile of gold would be easy for the Feds to confiscate. Hence that cannot work, at least not in this social/political environment. But a distributed digital currency that is not backed by gold cannot so easily be shut down by the money monopolist powers that be.

If you had a 2013 $1billion worth of bitcoins, would you want the tax man to know who you were? "Out of sight out of mind" is a virtue. Sorry, but in a world full of thieves, its best not to reveal how much resources you have nor where your resources are. I don't think anything negative about the creator of bitcoin staying anonymous, I think it was smart, I think that the powers that be might very well attack him if they knew who he was because he is taking away their ability to steal wealth through money printing.

Your claim that wealth from holding Bitcoins is malicious in nature is completely invalid. Where the justification for the wealth comes from is that the holders of bitcoin recognized Bitcoin's value for the world, and hence held it rather than selling it. Its high price helps signal to more technical people to look into it and adopt it, and eventually it will help non-technical people to recognize its value too. You predict that eventually bitcoin's price will crash because its current market value is higher than it should be, and hence you feel sorry for the people who were duped into it and dislike how some are trying to sell it for their own personal profit at others expense. Know that I am not trying to get you into Bitcoin for my benefit at your expense. Instead, I want to help Objectivists identify for themselves the value of the Bitcoin technology, and buy some bitcoins if they feel its worth adding some to their portfolio.

The person who invented Bitcoin in my mind deserved the market purchasing power he attained. He even publicly released a paper before beginning the bitcoin blockchain, and made it fully public for others to join right from the start. So basically everyone in the world had the opportunity to get in early... its just that so few people actually identified its value from the start. The early adopters who identified its value also in my mind deserved what they earned. Through Bitcoin's history up until now, there was never complete certainty that bitcoin would be valuable. There were plenty of weak hands that sold out back in the summer of 2011 when the price rose up to $30 then crashed.

I do not disagree that one day Bitcoin's value may very well become zero. Whether its drop in value will be sudden or gradual I can't be absolutely sure:

From my understanding of the software (I am a software engineer) (I did a 100% code review), there is no known flaw to the cryptographic technology that it is based on. If there was a flaw in the system, then that could cause its value to instantly drop to zero, which is a potential risk. Bitcoin has only been around for 5 years now... but now that its value is higher I'm sure more people are looking into how they might break it (Especially the powers that be).

Potentially a new technology that is even better than Bitcoin will come out and slowly take its market share. Potentially even a altcoin that has technical features just like bitcoin, but has a different inflation/distribution system might compete and eventually replace it too. Never the less, the Bitcoin technology in my mind is an awesome new currency technology that will enable more efficient trading than ever before. if either of these possibilities happen, the value of bitcoins will go down gradually. And I am excited that it exists and that I will be able to use it while it is used.

[moralist]

Greg,

If you pin a currency to gold, then you have to have a pile of gold to back it.

Well, that's the only way to do it honestly. Anything else is a Ponzi scam.

If you had a 2013 $1billion worth of bitcoins,

Haven't you ever asked yourself where that $1billion came from?

Hint: It came from the pyramid.

would you want the tax man to know who you were? "Out of sight out of mind" is a virtue.

What you regard as a virtue I regard as a lack of character.

Sorry, but in a world full of thieves, its best not to reveal how much resources you have nor where your resources are.

That's especially true if you're a swindler.

I don't think anything negative about the creator of bitcoin staying anonymous, I think it was smart, I think that the powers that be might very well attack him if they knew who he was because he is taking away their ability to steal wealth through money printing.

I know. Your statement reveals the difference between our values. Honest men are not afraid of others knowing who they are. The dishonest need to hide.

Your claim that wealth from holding Bitcoins is malicious in nature is completely invalid. Where the justification for the wealth comes from is that the holders of bitcoin recognized Bitcoin's value for the world, and hence held it rather than selling it. Its high price helps signal to more technical people to look into it and adopt it, and eventually it will help non-technical people to recognize its value too.

You've just provided an accurate description of how pyramid scams operate: The illusion of perceived value which depends upon constantly recruiting more and more people to believe in the same illusion for it to continue.

You predict that eventually bitcoin's price will crash because its current market value is higher than it should be,

That's close, but not quite there. I'm saying that any currency which is not backed up by anything real will eventually revert to its original value... nothing. And parenthetically, this also holds true for people who are not backed up by anything real.

and hence you feel sorry for the people who were duped into it and dislike how some are trying to sell it for their own personal profit at others expense.

Oh, not at all!

Swindlers who profit from opportunistically preying on suckers who believe the illusion that they can get something for nothing, deserve each other.

Their values are a perfect match.

Know that I am not trying to get you into Bitcoin for my benefit at your expense. Instead, I want to help Objectivists identify for themselves the value of the Bitcoin technology, and buy some bitcoins if they feel its worth adding some to their portfolio.

Even though I'm nowhere close to being a big O Objectivist, I am enough of an objective Capitalist to put my bets on reality.

For only reality is immune from Green Double Zero events.

From my understanding of the software (I am a software engineer) (I did a 100% code review), there is no known flaw to the cryptographic technology that it is based on.

...but you don't see the moral flaw that it is based on.

Greg

[deanwins]

Greg,

In an oppressive society, I don't think its good to stick your head up, you are likely to get hammered down. For example, it was once a very bad idea to reveal to others that you are an atheist. Also, by your logic, it would be a good idea to walk down a dangerous alley with a sign that says how many dollars are in your wallet.

Let me establish this point: Its generally good to tell the truth to your friends. It can be very bad to tell the truth to your enemies. If we disagree on this, then we have contradictory premises. If you agree on this, then you have a contradiction in your logic.

[moralist]

Greg,

In an oppressive society, I don't think its good to stick your head up, you are likely to get hammered down.

America is anything but an oppressive society. We enjoy more freedoms than any other people... especially the right to private property. But our freedoms rest upon the foundation of doing honest work to earn the money that buys our financial freedom.

For example, it was once a very bad idea to reveal to others that you are an atheist.

Well, that pendulum sure has swung the other way. Today it's a very bad idea to reveal to others that you are a Christian!

Also, by your logic, it would be a good idea to walk down a dangerous alley with a sign that says how many dollars are in your wallet.

I was referring to dishonest swindlers who need to hide their identity from others, while you're talking about not divulging financial information. Those are two completely different issues.

Greg

[deanwins]

Greg,

The person who created Bitcoin is not a dishonest swindler. In my mind it is disgraceful that you call its inventor a dishonest swindler. Before the creator disappeared, I had conversation with the person, who in my mind was nothing other than interested in ending the corruption resulting from fiat money and restoring our ability to trade without counter party risk/exploitation. Whether you take advantage of it or not, Bitcoin has broken the bonds of our enslavement to monopoly money enforcers. For that you should only be grateful, although given your lack of understanding I see how you could come to the prejudice conclusion you have so far made.

I would appreciate it if you at least acknowledged that its possible you could be mistaken on your judgement of the creator's intention and the potential value Bitcoin might have to our lives (despite your current predisposition). I agree for years that one of the Austrian School's arguments against fiat was that it is not backed by anything. For a long time I agreed that this was a very valid criticism for fiat currencies. Fiat means by government decree.

But Bitcoin is an entirely new system, a new technology, that replicates many of golds features. Again I assert that it as a technology has the potential to enable more efficient trade than previous currency technology, and this is where its value comes from... a completely new system that most Austrian School practitioners have yet to honestly re-evaluate. Bitcoin does not have value by government decree, forced upon us as our only means of currency trade, and Bitcoin is limited in supply (unlike USD/FRN), both of which are valid criticisms of fiat but not Bitcoin.

Severely,

Dean

[BaalChatzaf]

Greg,

The person who created Bitcoin is not a dishonest swindler. In my mind it is disgraceful that you call its inventor a dishonest swindler. Before the creator disappeared, I had conversation with the person, who in my mind was nothing other than interested in ending the corruption resulting from fiat money and restoring our ability to trade without counter party risk/exploitation. Whether you take advantage of it or not, Bitcoin has broken the bonds of our enslavement to monopoly money enforcers. For that you should only be grateful, although given your lack of understanding I see how you could come to the prejudice conclusion you have so far made.

I would appreciate it if you at least acknowledged that its possible you could be mistaken on your judgement of the creator's intention and the potential value Bitcoin might have to our lives (despite your current predisposition). I agree for years that one of the Austrian School's arguments against fiat was that it is not backed by anything. For a long time I agreed that this was a very valid criticism for fiat currencies. Fiat means by government decree.

But Bitcoin is an entirely new system, a new technology, that replicates many of golds features. Again I assert that it as a technology has the potential to enable more efficient trade than previous currency technology, and this is where its value comes from... a completely new system that most Austrian School practitioners have yet to honestly re-evaluate. Bitcoin does not have value by government decree, forced upon us as our only means of currency trade, and Bitcoin is limited in supply (unlike USD/FRN), both of which are valid criticisms of fiat but not Bitcoin.

Severely,

Dean

Bitcoin is a computer entity. Mark may words. ANY computerized artifact can be hacked and fiddled. At least gold can be tested for being genuine and it cannot be counterfeit or produced at will. The gold we have on earth is the gold that was there when the planet formed. Their ain't no more. Once the underlying software of Bitcoin is compromised your bit coins will become bupkis. Also bitcoins have become objects of speculation. There is a bitcoin boom. Bitcoins are the latter day tulip bulbs that ravaged the Netherlands in the 1640's. You want non-fiat currency. Then gold, silver, platinum and even iridium is what you want. Not computer generated artifacts.

Ba'al Chatzaf

[deanwins]

Ba'al Chatzaf, I agree there is risk that potentially the system has security problems that haven't been found/taken advantage of yet. But given your statement, one might conclude that we should stop using online commerce altogether. I'm not saying that one should invest their entire lives savings in bitcoin. I'm saying one should use it for day to day trade instead of USD/FRN. Given each persons view on the risks of using bitcoin, and financial situation, this makes sense for some more than others.

[moralist]

Greg,

The person who created Bitcoin is not a dishonest swindler. In my mind it is disgraceful that you call its inventor a dishonest swindler. Before the creator disappeared, I had conversation with the person

If you actually talked to him, then you know who he is?

No.

Men of principle do not need to hide their identity from others... but cheats and swindlers do.

who in my mind was nothing other than interested in ending the corruption resulting from fiat money and restoring our ability to trade without counter party risk/exploitation.

The operative phrase is "in my mind". So we each have a different view. In my view, you can only end corruption within yourself, and that's where it always begins. No one can end corruption in the world. That's a Messianic fantasy. I already had mentioned that bitcoin is very much akin to a religion, and you are one of the faithful who evangelizes for converts. Bitcoin is like obamacare and carbon credits in that you believe that it will work if you can just get enough people to join your collective. Your religious faith in bitcoin is because you have skin in the game. So you need others to put in their money to broaden the base of the pyramid underneath you to make your bitcoins go up in virtual value. In fact I'll bet that they already have gone up a lot. I understand that the illusion of getting something for nothing is exciting. But there is a price paid, and that cost is your own moral character.

Whether you take advantage of it or not, Bitcoin has broken the bonds of our enslavement to monopoly money enforcers.

I broke my own "bonds of enslavement to the money enforcers", and I didn't even need to buy into a Ponzi to do it. I tell you, the weak need to join collectives and need to get others to join their collective. Whereas a man stands alone and goes his own way regardless of what others do, because as a sovereign individual he knows what's right and wrong and does what's right.

For that you should only be grateful,

For what?

although given your lack of understanding I see how you could come to the prejudice conclusion you have so far made.

That's fine, Dean. Just regard my opinion as prejudice. We each have the freedom to do as we see fit.

I would appreciate it if you at least acknowledged that its possible you could be mistaken on your judgement of the creator's intention and the potential value Bitcoin might have to our lives (despite your current predisposition).

I know I'm not wrong because I've been around long enough to see more than a few Ponzi scams come and go. (The latest one being the home mortgage Ponzi.) We're different in that I don't need bitcoin to add value to my life because I already do that for myself. Do you see the contrast between us, of your dependence and my independence?

But Bitcoin is an entirely new system...

...but it's the same old people with the same old fantasy of getting something for nothing.

Greg

[deanwins]

Greg: Re: your last post: I disagree.

[BaalChatzaf]

Ba'al Chatzaf, I agree there is risk that potentially the system has security problems that haven't been found/taken advantage of yet. But given your statement, one might conclude that we should stop using online commerce altogether. I'm not saying that one should invest their entire lives savings in bitcoin. I'm saying one should use it for day to day trade instead of USD/FRN. Given each persons view on the risks of using bitcoin, and financial situation, this makes sense for some more than others.

You are speculating on the modern version of the tulip bulb.

[deanwins]

Ba'al Chatzaf,

I agree that so far Bitcoin does have some similarities to "Tulip Mania". Its newly being used as currency, its price is being discovered, and the price is rapidly increasing. But Bitcoin is different then Tulips. So although you are seeing similarities, it cannot be deduced that the result will be the same. Its merely an induction, which I would argue is a poor induction, which we disagree on.

For example, the tulip mania ended when people started farming more tulips. On the other hand, there will only ever be 21 million bitcoins. So the cause for tulip mania's price collapse cannot be the same cause for bitcoin's price collapse. (Given there is no technical flaw in bitcoin, which I agree there is a risk in this particularly since it is such a young technology.)

[Backlighting]

Dean "Its generally good to tell the truth to your friends. It can be very bad to tell the truth to your enemies"

Hello

Absolutely.

I've had the hammer drop on me throughout my life, particularly during my younger years, telling the truth to adversaries.

The degree to which I now trust someone is the degree to which I will speak candidly with them.

-Joe

[moralist]

On the other hand, there will only ever be 21 million bitcoins.

You don't know that, Dean. It is an accepted article of faith in the bitcoin religion. Given the creative nature of humans to constantly invent new ways to swindle each other, there exists no computer program which has not been hacked. In fact the combination of bitcoin's total virtuality and it's Ponzi pyramidal structure makes it far more vulnerable to a Green Double Zero Event, similar to 2008 when people were forced to face the reality of how they had screwed themselves trying to get something for nothing.

Something for nothing is anti-reality.

So it's all well and good to dance as long as the music is playing. But when the music suddenly stops on the day of reckoning when the ledger of financial reality is reconciled, the dancers will only then discover the lack of chairs in the room.

Greg