The Future Of Money

[Pertinacious Tom]

Major Banks Using Blockchain For International Trade

 

[Pertinacious Tom]

Bitcoin Mining In Venezuela

The government there has created a situation in which it's almost impossible to make money, but electricity is virtually free.

The main cost of Bitcoin mining (in most of the world) is electricity.

Bitcoin's potential as an alternative to government-issued currency is still hotly debated outside of Venezuela. But in a country lacking food and basic health care, there's nothing theoretical about it. Bitcoin is helping to keep pantry shelves full and medicine cabinets stocked, making life tolerable—if not always easy—in the midst of a socialist hell.

It's a sad situation but subversive in a wonderful way.

 

[SloopJonB]

The Future of Money? Nobody Cares.

The businessman who controls the Wall Street Journal and Fox News, Rupert Murdoch, and the former mayor of New York City, Michael Bloomberg, both recently sounded similar themes. Bloomberg asserted that the Fed's low interest rates have "exacerbated the wealth gap between the poor and the rich because the rich have assets. And that is what is being hiked here because of low interest rates, whether they own stocks or real estate or whatever the case may be." And Murdoch wrote on Twitter that "Fed trillions ended inflating existing assets. Stocks, real estate, art."

A New York Times editorial puzzles over home prices and asserts, "only investment income has been rising steadily in the recovery, while wages from work have stagnated." Much depends on whether the cost of employer-provided health insurance is included in wage income, but even so, and without mentioning the Fed, the Times editorialists sound a bit like Bloomberg and Murdoch.

Maybe the presidential candidates think this is an issue too complicated for ordinary voters to understand? By that theory, voters are supposed to be fascinated by the details of H1-B visas, Iran's nuclear centrifuges, elementary school student testing and teacher evaluation, hydraulic fracturing, and health insurance—but not at all interested in the value of a dollar. Could be.

Gee, I would have thought that printing a bunch of money and thereby inflating the values of real estate, stocks, and artwork would have had huge benefits for poor people. This monetary policy stuff is way more complicated than I imagined. Who could have figured out that poor people don't collect art or own stocks?

Right Wingers - they can't figure out much when it comes to finance. That's why all the truly colossal economic fuckups of the past 80 or 90 years have been perpetrated by right wing government policies.

Here's a tip - whenever you see someone talking about "Fiat Currency" you can take it as a given that they are a right wing fanatic and don't have a clue how money or international finance works.

 

[Saorsa]

bitcoin is blockchain but still needs some way to enforce value. It might as well be gold.

Blockchain allows anyone who agrees to some value for some period of time to make transfers.

Take a look at transferwise.com to see how to handle Forex transactions without the banks setting arbitrary buy/sell rates and fucking with fees.

I'm sure the folks who run it are making shitloads of money while providing me with a much, much better rate on transfers from the UK.

 

[Pertinacious Tom]

...

Here's a tip - whenever you see someone talking about "Fiat Currency" you can take it as a given that they are a right wing fanatic and don't have a clue how money or international finance works.

So what explains the difference in value between an old silver dime and a modern dime?

 

[SloopJonB]

Inflation and rarity.

 

[Pertinacious Tom]

Inflation and rarity.

And the inflation occurs because the basis of one is "Trust us" coming from the US government.

 

[SloopJonB]

What's your point?

That's what money is and always has been. Before Nixon ended the gold standard do you think anyone ever got a gold bar from Fort Knox in exchange for their greenbacks?

Here's a hint - private ownership of gold was limited to extremely small amounts - like Mom's jewelry.

Better just accept it - it ain't gonna change because someone comes up with a new web based funds transfer option.

 

[Laker]

80% of the number of US bills in circulation are of the $100 variety. Good reason for a call back as I can see. The underground economy and money laundering would be hit hard.

...

Here's a tip - whenever you see someone talking about "Fiat Currency" you can take it as a given that they are a right wing fanatic and don't have a clue how money or international finance works.

So what explains the difference in value between an old silver dime and a modern dime?

face value. Problem is that the penny takes more money to make than it is worth.

 

[SloopJonB]

That's why we dropped ours - rumour is the nickel is next. $1 & $2 went to coins years ago because the bills only lasted a short time.

 

[Pertinacious Tom]

What's your point?

That's what money is and always has been. Before Nixon ended the gold standard do you think anyone ever got a gold bar from Fort Knox in exchange for their greenbacks?

Here's a hint - private ownership of gold was limited to extremely small amounts - like Mom's jewelry.

Better just accept it - it ain't gonna change because someone comes up with a new web based funds transfer option.

Always has been? I've personally carried really heavy bags of silver dimes around.

Back when they were currency, one could buy you about a gallon of gas. Today, one can buy you about a gallon of gas.

That money was different from current money because it had inherent value, not fiat value.

Better just accept it: Venezuela is further down the devaluation road than we are and things have already changed. Did you read the article I posted?

 

[Pertinacious Tom]

3 Ways Bitcoin Is Promoting Freedom

They're really all the same way: the blockchain is allowing people to go around meddlesome governments.

 

[BeSafe]

3 Ways Bitcoin Is Promoting Freedom

They're really all the same way: the blockchain is allowing people to go around meddlesome governments.

Bitcoin definitely offers opportunity in failed states. Black market economies always spring up where the 'sanctioned' markets fail to satisfy some large group of people. The "TIDE" economy is pretty clear evidence that even in affluent societies, some level of black market economy always exists.

I'm pretty skeptical that bitcoin can actually supplant the economy of a durable state. In most cases, the state isn't going to give up it's status as printer of money that easily. Bitcoin has worked largely because China has facilitated market liquidity. Take that away and I'm not sure if there's truly enough basis to keep it operating. I think countries like Zimbabwe and Venezuela are so damaged they could use it but beyond those borders, it takes a certain level of acceptance into the broad global economy to maintain traction.

BTW: I'm a huge Bitcoin fan and have mined it, traded it, bought stuff, blah blah. But I'm also aware of how fast it can go sideways in the face of direct government seizures or large scale fraud. The other feature that i'd like to point out is that Bitcoin, in particular, is 100% traceable. That's actually part of the appeal of using blockchain for OTHER types of transactions. It's just usually not worth the hassle. There are alternatives that are trying to get around that but it's not clear there's really a significant market for those alternatives. The criminal abuse side makes those cryptocurrencies the focus of intense attention.

 

[Saorsa]

3 Ways Bitcoin Is Promoting Freedom

They're really all the same way: the blockchain is allowing people to go around meddlesome governments.

The thing is that blockchain can get around currency completely. It becomes a form of barter.

 

[Steam Flyer]

... ... ...

... I've personally carried really heavy bags of silver dimes around.

Back when they were currency, one could buy you about a gallon of gas. Today, one can buy you about a gallon of gas.

That money was different from current money because it had inherent value, not fiat value.

You (and all the ones shouting "fiat currency"!) should study some real economics, not just read Ron Paul's pamphlets

Why does a silver coin, or a bar of gold, have "inherent value?"

Hint: it doesn't. It's valuable because other people think it's valuable.

You (and all the ones shouting "fiat currency"!) should take a step back and ask why inflation is low, and also why it's relatively stable; furthermore why US debt instruments are the most secure & safe (hence the low interest rates) investment in the world... not just that, in the history of the world.

A quick education in what money really is and isn't: look up the word "shinplaster."

-DSK

 

[Pertinacious Tom]

People think a silver dime is a lot more valuable than a fiat dime.

Zero is not an interest rate. It's market manipulation.

We are, for now, the world's reserve currency. And, for now, we can pay our debts. Those things can change. But still a silver dime will be valuable.

 

[Steam Flyer]

People think a silver dime is a lot more valuable than a fiat dime.

Zero is not an interest rate. It's market manipulation.

We are, for now, the world's reserve currency. And, for now, we can pay our debts. Those things can change. But still a silver dime will be valuable.

Inflation is not zero.

Silver is valuable. You can make jewelry and electronic parts out of it.

The fact that ancient peoples made jewelry out of silver & gold long before there was a written language, silver & gold commonly have the impression of "inherent value." Some ideas take a really really long time to fade. Check how much the local pawn shop will give you for a pile of gold chains (or whatever), then get back to me on "inherent value."

Silver & gold both have commodity markets. Their bling value push the market value up, their usefulness as engineering material put a floor on the market value. If that's what you mean by "inherent value" then I agree; but there is absolutely no reason to tie US (or any other nations') currency to one or the other. Or platinum, or crude oil, or any other commodity.

Why not go back to wampum belts? Wait that's not a serious question...

Exercise for the serious: explain why US paper currency is different from a shinplaster.

Warning: Answers below the level of a C in high school civics will be mocked.

-DSK

 

[2slow]

Tom said interest rates were zero, not inflation.

US currency is different from a shinplaster because it has an agreed upon value across the world and is accepted virtually everywhere.

was going through an old box the other day and found 10 rolls of dimes and 5 rolls of quarters all rolled in 1965. I prefer them to fiat dimes and quarters

 

[Pertinacious Tom]

People think a silver dime is a lot more valuable than a fiat dime.

Zero is not an interest rate. It's market manipulation.

We are, for now, the world's reserve currency. And, for now, we can pay our debts. Those things can change. But still a silver dime will be valuable.

Inflation is not zero.

Silver is valuable. You can make jewelry and electronic parts out of it.

The fact that ancient peoples made jewelry out of silver & gold long before there was a written language, silver & gold commonly have the impression of "inherent value." Some ideas take a really really long time to fade. Check how much the local pawn shop will give you for a pile of gold chains (or whatever), then get back to me on "inherent value."

Silver & gold both have commodity markets. Their bling value push the market value up, their usefulness as engineering material put a floor on the market value. If that's what you mean by "inherent value" then I agree; but there is absolutely no reason to tie US (or any other nations') currency to one or the other. Or platinum, or crude oil, or any other commodity.

Why not go back to wampum belts? Wait that's not a serious question...

Exercise for the serious: explain why US paper currency is different from a shinplaster.

Warning: Answers below the level of a C in high school civics will be mocked.

-DSK

Yes, that's what I meant by inherent value.

My reference to market meddling was to Quantitative Easing and the fed funds target rate of zero. Link upthread. Zero is not an interest rate and I never said it was the inflation rate.

 

[Steam Flyer]

... ... ...

My reference to market meddling was to Quantitative Easing and the fed funds target rate of zero. Link upthread. Zero is not an interest rate and I never said it was the inflation rate.

That wasn't meant as some kind of booby trap; in your post to which I was replying, you referenced inflation several times.

-DSK