I read somewhere that they are recovering from the crisis. The government didn't try to save failing companies.

Who really creates new money is the state through the central bank, not bankers.* And it does use it as a form of spending since the central bank is constantly buying state debt, and when the debt bonds expire in the hand of the central bank, the treasury doesn't pay for it (as it would be the state paying to the state...). Inflation is also hidden tax. And it's worse than that, due to the reasons explained above.

* Okay, when the compulsory decreases, banks do create new money through the fractional reserve system. But the compulsory stays constant most of the time. It's the central bank that really drives inflation.

Exactly. In central banking, Keynesian systems, inflation is used to manipulate the interest rate. The interest rate is a fundamental price that guides people planning in what concerns time. ("The market coordinates time with interest" http://www.youtube.com/watch?v=d0nERTFo-Sk )

Inflation alone is bad thing because it's a "hidden tax". Taxes are all bad, and the more hidden they are, the worse. But inflation in our current system is even worse, as it creates business cycles that end up destroying lots of capital.

I never heard this acronym before but this statement is not right.
Market prices help entrepreneurs finding out which activities allocate resources better. Some of these activities may bring you large gains, why not?

It's not positive... you have to spend a fortune, and what could you accomplish? In the best scenario you would attack some exchanges and get some cash, but then, that would identify you, since cash transfers are not anonymous. You wouldn't manage to make a positive ROI by doing cash-in-the-mail exchanges!

Seriously, I can't see how such an attack would be profitable. I bet that, if you're willing to engage in criminal activities, there are probably much better ROIs you could obtain with such an investment....

Brazil has the 5th largest internet population. http://www.internetworldstats.com/top20.htm (well, it's the 5th largest world population anyway, if Pakistan haven't yet passed, so it's just average...)
It might not be cheap, but it's perfectly possible to run bitcoin.


I hope it happens: http://seasteading.org/

Somebody correct me if I'm wrong, but all that can be done by outcoming the network computing power is double-spending, right? More precisely, rewriting recent blocks.

I think we all agree that there is no monetary incentive to do so... the costs clearly outweigh the benefits.

And even thinking on the possibility of a politically motivated action... what exactly could they accomplish with it? If they start double-spending, they would hardly remain anonymous for too long... their victims would eventually denounce it, and the sorcery would turn against the sorcerer. Besides double-spending, they could erase transactions... but still, is that worth such a big investment? Particularly in a post-wikileaks world where this action could eventually become public?

I really don't think this is the kind of thing we should worry about.

He was probably talking about the default client generator.
There are many different implementations of generators out there. If someone creates one that reuses the generation address, there's no reason to refuse the generated blocks.

I don't know. If I knew, I'd be working on it.

I don't know, but, if the US government ever decide to attack bitcoins as strong as sometimes people here imagine it might, like trying to forbid it completly and throwing TERRORIST!!!-like accusation towards bitcoin users, you bet that there are a few anti-american governments out there who would really consider embracing the technology.

Pretty much like the Brazilian government offering protection to Julian Assange.... hehe, had wikileaks published dirty secrets of the Brazilian scum, things would be quite different.

I'm sorry, but the article is silly.
The only considerable risk is the legal one (number 2). But then, fighting the current banking system isn't the whole purpose of this idea anyway? Does anyone expect it to be easy?

And about competition, that might represent a risk for someone that puts all his eggs on bitcoins, but in general, if something better come up, we should celebrate.

No, they won't.
http://mises.org/daily/4466

You probably didn't lose your coins, if you transfered to the correct address.
It's just that restoring a backup like that is not automatic yet, you must force the indexation by deleting the block chain from your computer.

That's anonymity you want. Why Tor isn't enough?
Actually, encrypting won't make it anonymous, the nodes you're connecting to would see the messages coming from you.


By the way, are propagated messages any different from those sent by their creators?

I can see the advantage on the authentication part. You could have a set of trusted nodes to connect to in order to avoid being "surrounded" by attackers.
But, as most people minded with security (banks and other institutions included) will probably hide their IP, this wouldn't be so useful, unless the client could connect to hidden services. But then the anonymity network itself guarantees authenticity, no need for the client to sign its messages...

Now, on the encryption part of an SSH-like connection, I fail to see the advantages. All messages your client send are supposed to be propagated to the entire public network anyway. They are not secret. Why encrypt?

I'd rather change your request to something like "being able to configure a set of IPs and/or Tor/I2P hidden services ids to connect to".

I don't if that's what you meant, but I think that if bitcoins adoption grows faster than governments reaction capacity (like the Internet did), I think they'd eventually create something like a "whitelist" of addresses, which they would control as they do with bank accounts - no anonymity, taxes etc.
No business would be authorized to use an undeclared address, and transfers from declared addresses to undeclared ones would be illegal. Foreigners would be given a way to convert their undeclared addresses to declared ones, probably by paying fees.

The state doesn't solve anything "peacefully", since it's a violent institution by definition.
But I know what you mean.
I once wrote something about it, but it's in Portuguese, you may check if an auto translation is understandable: http://translate.google.com/translate?js=n&prev=_t&hl=fr&ie=UTF-8&layout=2&eotf=1&sl=pt&tl=en&u=http%3A%2F%2Fwww.mises.org.br%2FArticle.aspx%3Fid%3D605

If you are really curious on how conflicts can be solved without a monopoly of violence search about medieval Ireland or Iceland, Merchant Law and so on... at the end of the text I liked above there are some references, in English. This short book is good too: http://mises.org/books/chaostheory.pdf

Of course, but he's the first one I see on these forums at least.

Or maybe you're just mixing normal debt with state debt. State debt can be viewed as slavery since they force others to pay it. But then, isn't just the debt, absolutely everything the state does implies in slavery... (maybe servitude is a better word...)

Are you really suggesting that if you ask to borrow my money and I agree to lend, I'm enslaving you? And that if you run away with what is mine without ever paying back you're not robbing me, just liberating yourself?

I see no gray shade there, this is plain wrong... it would only be comparable to slavery if I had forced you to accept it somehow, but then it's not lending anymore, it's extortion or worse.

You might have issues with the current centralized banking system, as we all here have. But the act of lending is perfectly OK and voluntary, there's no slavery there. Actually, loans are something really fundamental for economic growth, it's through them that savers feed investors.