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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Haim R. Branisteanu who wrote (103928)	12/8/2013 4:23:57 PM
From: Maurice Winn	Respond to of 220341

Exactly Haim. <Every sovereign state has an interest that those type of adventure should not establish itself as a credible currency. The ability to print money is one of the main sources of power of any government over its citizens and a source of covert revenue for any government if directly or indirectly trough QE.> But if you think bitcoin is just a collection of Beanie Babies and Tulip bulbs, then why should governments worry about such trivia? If our great, amazing, venerable and venerated idol Uncle Al KBE is right that bitcoin is a brief buzz of irrational exuberance for something of no actual value since it's unbacked by anything at all of intrinsic 3D material value, then why would governments bother with giving it a moment's thought? Perhaps for our own safety? "We want to ensure you are not harmed by this new fraudulent fake and rip-off bitcoin bubble so we are banning any use, possession, derivative, association, trading or support of bitcoin or anyone associated with it in any way. Punishment shall be death." If you believe that "It's for your own good", [which is likely coming because bitcoin is really a threat to the self-dealing pixilated process of political printing of petabucks] then I have a few bridges for sale. First they'll tax it and control it and regulate it, but when/if it gets annoying they'll ban it, or introduce punitive taxes on it, such as "5% tax on any holdings of bitcoin" which must be held at a government-approved bank. That's pretty much what they do now with foreign currency holdings. I have to pay capital gains tax on US$ deposits [no tax on the interest as there is 0% interest]. So which is it? Beanie Babies or a threat to the world's central bankers? Mqurice

To: Haim R. Branisteanu who wrote (103928)	12/8/2013 4:41:19 PM
From: Maurice Winn	Respond to of 220341

An amusing article about the volatility and permanence of bitcoin. Worth tucking away for a few years to trot out in 2020. Michael seems not to understand my recently enunciated law of supply and demand and the effect on prices. He also has no clue about Cybermoney. latimes.com By Michael HiltzikDecember 7, 2013, 7:28 a.m. People who thought that bitcoins could serve as either an investment vehicle or an alternative world currency got their heads handed to them on Thursday and Friday. That's when the price of the attention-grabbing crypto-currency got crushed, falling from a quoted $1,200 per "coin" to less than $600. At this writing, it's quoted on the Mt. Gox exchange at about $830. The whipsaw validates what we wrote about bitcoins just two weeks ago: they're useful as a medium of transfer, but even then you have to be nimble. If you were a Greek or a Spaniard using bitcoins to move money out of your home country without having to worry too much about your local foreign exchange or banking rules, and you figured on Thursday that you could get around to transferring your asset back out of bitcoins and into dollars or sterling--whoops! You lost half your stake in a matter of hours. The minimum time required to complete a trade in bitcoins is ten minutes; that's about how long you should hold them to keep exchange rate risk low. And if you were taken in by all the talk about bitcoins replacing gold as a storehouse of value, well, now you've been taken down. Much of that talk was generated by the peak quote of bitcoins last week at $1,200, which was sometimes described as equivalent to or even higher than the price of gold. That's an absurd statement, of course: $1,200 bought you an ounce of gold bullion, but on the bitcoin market it only bought you a putative claim on the outcome of a mathematical algorithm. The proximate cause of the bitcoin crash was a warning by China's central bank against treating bitcoins as legal tender. The Beijing government didn't ban bitcoins, however, stating that Chinese citizens are still free to engage in bitcoin transactions at their own risk. The bitcoin market's reaction underscores what Stanford economist Susan Athey has said--that the value of bitcoins lies in their potential to facilitate transactions. The more transactions you think can be done in bitcoins, the higher their price. Because the Chinese government's statement may reduce confidence in bitcoin trades there, the market plunged. Bitcoins will undoubtedly rise in quoted value again, and also fall again. The one inevitability about them is their volatility, to which there's no end in sight. What does this tell us about bitcoins' future as an alternative currency? This is the hope of gold bugs and other critics of central banks and their fiat currencies, but plainly bitcoins aren't anywhere near that stage yet, and probably never will be. Bitcoin advocates love to talk as though their new medium will be a counterforce to governments' tendencies to devalue their own currencies for economic gain. As Boston University economist Laurence Kotlikoff recently wrote: " Anyone familiar with current U.S. monetary policymight well wonder whether our country wouldn't be better served with bitcoins replacing the dollar." You can stop wondering. The answer is no. latimes.com If bitcoin is such a zero, why would China's bosses be allocating any brain space to it when they have bigger matters to think about? Just to deal with one mistaken criticism of bitcoin, the 10 minute problem. The argument that bitcoin transactions take at least 10 minutes is incorrect. If I deposit my bitcoins at a regular bank, they could issue me a debit card, or credit card, with which I could make instantaneous transactions at any regular transaction point, just as now with US$ or $kiwi credit/debit cards. Give it a year or three and we won't need to carry a card. Just an iris, fingerprint, voice response and PIN. Eftpos device, "Please say your name" Me, "Mq" Eftpos, "Please confirm you are the official Mq and that you authorize this transaction as it is over your self-selected spoken authorisation maximum transaction by entering your PIN" Me, enters PIN to device. Eftpos, "Since this is above your instantaneous transaction amount, we will make the transaction 24 hours from now and have notified your authorize 3rd party and your Cyberspace management device for confirmation of the transaction." After confirmation of the purchase of a new Lexus, the car company delivers the car to my driveway, or I go there and collect it. Mqurice