...
I wish I could sell subscriptions to my ignore list. |
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some of us here understand the value of the bitcoin distinct form the price of btc to paper money.
if you base the value of BTC in USD or some other centralized government regulated paper currency you are missing the point.
Bitcoin is effectively a fiat token with some hard money properties. It does not meet any economic definition of a money. It's not even a commodity. The only thing you can do with a bitcoin is send it to another bitcoin address. It's becoming apparent to more and more people that bitcoin is merely a fad among a few geeks that just like to play with it, and that it was/is misunderstood by tens/hundreds of thousands of people (and continues to be misunderstood by most that remain in the community) to be something most people would value. This is what caused it's large price increase into the $30s when people expected the mainstream attention to result in bitcoin catching on. (It hasn't yet, and most likely won't, and is currently teetering on the brink of a catastrophic collapse where the price becomes too low to make mining profitable, resulting in extremely slow block generation/confirmations, which will make it even worse as a form of payment, thereby hurting it's value and price further.) I have yet to see a single bitcoin developer (or anyone, whether inside or outside the bitcoin community, for that matter) express accurate understanding of bitcoin's economic value and how to take advantage of it. Eventually most bitcoin users will find that, at least in it's current form, the only value of bitcoin to them is to try to acquire as much profit as they can in terms of government fiat currency and/or other goods from bitcoin before it collapses to whatever price those few bitcoin geeks will pay for them. Paragraph breaks are your friend. As would be a coherent logical structure. But no matter, the substance of your post is worse than the style. What "economic definition of money" are you talking about? Medium of exchange? Check. Unit of account? Check. Store of value? Check. Sending to another address is enough. What more do you want? Are you sad that you can't draw a mustache on George? Apparent ≠ true. The doomsday scenario where miners all just disappear is just as silly when you say it as it was when the other dozen folks said it. I have a very good idea of bitcoin's economic value, and how to take advantage of it. But my ideas aren't mine alone, so if you haven't seen them elsewhere, I suspect the problem is that you have a different view, and you are unable to imagine a different view. Anything that I didn't address directly was baseless conjecture, unless I missed a valid point buried in that wall of text. Oh, and namecoin isn't bitcoin. Just FYI. |
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I must be the only person around that thinks that he looks stoned and is repeating cliches.
But I'm happy to see at least one person there repeating cliches that were at least true.
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Hello Mapper! - non-reversable
Does your map show the whereabouts of the following code? if (!fFileBacked)
return false;
CRITICAL_BLOCK(cs_wallet)
{
if (mapWallet.erase(hash))
CWalletDB(strWalletFile).EraseTx(hash);
}
return true;
Again? Are you ever going to understand that this isn't a transaction reversal? This is error correction. |
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aticonfig --odgc --adapter=$i
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For example, I don't consider the dollar to be very stable at all, except in relation to a limited subset of goods and services over very, very short periods, but the dollar is still a very useful medium of exchange.
Your definition of "a limited subset of goods and services" seems to mean just about every consumer good and service out there, while your definition of "very, very short periods" seem to mean around 5+ years. And that's all nice and dandy till we find that you've got no problem with bitcoins' price shooting up and down several folds within weeks. You're weird, you know? Been to the grocery store or the gas station lately? The dollar is hardly stable in relation to food, water, or gasoline, and the period is far shorter than "5+ years". How about the stock markets? Commodity markets? Forex markets? Not exactly stable there either. Natural gas or heating oil? The dollar doesn't appear to be stable relative to anything but the penny. Hoping for real long term stability is childish. Expecting it is madness. History tells us that state sponsored violence isn't enough to create stability.
Drama aside, I pointed out in the initial post that the proposed model will tie the coin's price to the average worldwide electricity costs. That's certainly not 100% stable on the long term, but I can promise you it won't double over a month nor lose half its value over 10 days. Let's just say it's significantly more stable than the current design. Got a better idea? Be my guest. In my opinion, Bitcoin is already a better idea. Bitcoin has stable rules, well known in advance and unchanging. You just think it is unstable because you don't see the feedback mechanisms in the system. Care to answer my question? The value of everything floats. Things that are more useful today than they were yesterday will become more valuable. Things that are easier to produce today will become less valuable. Hoping for real long term stability is childish. Expecting it is madness. History tells us that state sponsored violence isn't enough to create stability. What makes you think you are clever enough to design an algorithm in advance that will achieve it no matter what tomorrow brings? Oh, and to Crypt_Current... People like me aren't really interested in economics. People like me want to build a world free from economics altogether.
It doesn't really matter if you aren't interested in economics. Economics is very interested in you. |
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Wow... 6.5% interest. That's a lot more than last month and it is much more than the 1% fee. Looks like a lot of people withdrew money during September.
I'm seeing 0.2867%, which annualizes to about 3.4% Last month was .004867%, or 5.8% annually. |
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Have you actually seen any arbitrage opportunities lately? I've only been watching Mtgox and Tradehill, but the two have moved in rigid lockstep for maybe a month or two now.
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There's no point going through the technical details about whether the price will perpetually deflate since the last 20 pages pretty much cover all the for and against arguments on that and they're available for people to read if interested. Rather, it's more constructive if we focus on the main much simpler problem: the instability of the bitcoin's price. I don't think you have any doubts that the current model does not produce a stable currency, do you?
If we agree on that, then I hope we also agree that stability is an important if not an essential feature of a medium of exchange. It would then be established that we have a problem in the current design, and we'll start thinking about how to deal with it.
I think it is way too early to say whether or not the system is going to produce a stable currency or not. I suspect that it will produce enough stability, but for, I think, very nearly the exact same reasons that you think it won't. I'm also not sure that total stability (or really even more than a little stability) is a necessary feature of a medium of exchange. For example, I don't consider the dollar to be very stable at all, except in relation to a limited subset of goods and services over very, very short periods, but the dollar is still a very useful medium of exchange. The value of everything floats. Things that are more useful today than they were yesterday will become more valuable. Things that are easier to produce today will become less valuable. Hoping for real long term stability is childish. Expecting it is madness. History tells us that state sponsored violence isn't enough to create stability. What makes you think you are clever enough to design an algorithm in advance that will achieve it no matter what tomorrow brings? |
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There is one thing always confused me: People always say that financial crisis destroyed trillions dollar worth of wealth
Based on general economy definition, only consumable goods and services are wealth, money is just a medium of exchange. So, if a house used to worth 5 million now worths 3 million, the actual wealth (the house) do not change, it is just the price of the house changed, and I think this price change are mainly caused by two things: money supply and people's desire
What happens is that people realize the lost, which has already been done in the form of wasted resources. These resources were employed in bad investments, which had not enough returns. Bad investments occur all the time, but when they occur massively like in an boom-and-burst, that's because something interfered with prices, making people take decisions they otherwise would not. (if prices were a correct indicative of supply and demand). +1 Also, try to keep the ideas of wealth and capital clear in your mind. Invested capital can multiply the wealth created through work. If capital is misinvested, that capital is wasted right away, but it won't be obvious until the dreamed of gains fail to appear. Bad signals and denial can keep those losses off the books for months, years, or even decades. |
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i sure hope you're not saying my pt was silly. i think we're saying the same thing. think about it, if you feel HI is right around the corner, the best thing to do is to go out and take out the largest most leveraged loan you could get, typically a mortgage (most favored tax haven), and buy as many houses as possible. the banks got seriously hurt in the 1970's by giving out too many easy RE loans which got inflated away. this is one of my critical pts; they aren't going to repeat this mistake by leveraging up and spraying USD's all over the economy. and if you don't get HI, how is gold going to go to the moon?
Yup, that would be the most rational thing to do if you were sure that inflation was coming. Not even hyperinflation. Just regular old steady inflation of more than about 4 or 5% would be enough to make that a profitable play. My point was that even if Jesus himself showed up in person to tell everyone that hyperinflation would be starting in a month, housing would not be the place that most people would go to, because they are still smarting from the hard spanking they just got. Because of that, the chart of real estate loans can't really be considered evidence that people don't expect inflation. I have a habit of picking on bad arguments, particularly ones that are made in support of a view that I favor. but this is a major pt in favor of deflation. there was no greater amt of leverage poured into an asset class of the system by the plebes than residential RE. those 69% of Americans (peak housing participation rate) that bought anywhere btwn 1999 or so and 2007 are screwed into the biggest debt instrument of their lives. they won't be coming to the gold or HI party. The government has been spending like mad, and the Fed has been monetizing everything in sight to offset the credit collapse. I see both of these are as being more dangerous than consumer or commercial credit. Consumers and businesses have at least some notion of their own limited creditworthiness. They feel some restraint, while government has barely any. Hyperinflation won't be kicked off by private borrowing. When everyone is borrowing, the flood of new money creates inflation, but it also prevents the lack of faith in the system that is the fundamental difference between inflation and hyperinflation. And I see a lot of low level civil unrest around the country. From the protests in Wisconsin a while back, to the occupy X movements. But I mostly see them as people that are unwilling to take on more debt personally, but still want the benefits of free money, so they want government to acquire the debt for them. And government borrowing sure can cause hyperinflation. Just not today. Edit, 2011-10-06 14:01 CDT: are -> as |
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Did that convince you that you were wrong and I am right? No? Why not? Perhaps because it's not very convincing? Perhaps because I haven't actually said one single useful sentence?
I'd really like to start hearing arguments against (or for) my proposal please just for a change. Preferably from someone with a post count under 1,000.
I had a post count under 1,000 once, but I don't any more. Feel free to check my details though, if you think that I'm some old money dude trying to defend his hoard. I've earned about 125 BTC since I got started, and I've spent about half of that on goods and services, and I've lost a fair chunk more by gambling (both on actual gambling sites, and on the exchanges). Oh, and I'll be spending another 30ish (depending on the exchange rate) in the next week or so, which will leave me nearly bitpennyless. Every four years a miner needs to exert double the virtual effort to create the same amount of coins,
You are confusing the subsidy (creation) with the reward (income). If this was a paragraph about coin creation, it would be right, in that every 4 years halves the number of coins created. But the rest of the paragraph makes it very clear that you are really thinking of income, and income does not decrease linearly with time the way creation does. which means he'll be constantly demanding higher prices to compensate for his costs. Which also means that bitcoins won't generally be spendable. Why? Because only an idiot spends a currency which he is certain its price will double within 4 years, effectively granting him about 19% real annual interest--significantly better than any bank or mutual fund.
Linear. You are assuming that the cost of mining pushes the value, and that the value does not push the cost of mining. This is not true. If we ignore all other factors, we end up with something similar to the Lotka-Volterra equations where the cost of mining and the value of the coins have a complex non-linear effect on each other. But in reality, we can't ignore all other factors, because bitcoin gets value from exchange, not creation. So we need a third non-linear differential equation to show how mining relates to supply. And then we need a fourth, to show how value and creation relate to demand. And then we need a fifth, to show how value relates to saving. And then a sixth, to show how... See where I'm going with this? That free money will encourage people to hoard BTCs forever or until another wishful investor buys them, fueling speculation and price bubbles. Bitcoin will ultimately be regarded as a phony investment with no real value, just like the good ol' Pyramid (Ponzi) Scheme where everyone purchases a ticket just to sell it to someone else later for a high profit until the whole system collapses when it runs out of new victims.
A conclusion drawn from your previous linear mistake. You are assuming a system with no feedback, and then shocked (shocked!) to find that it runs away to a singularity. This scenario can only be avoided if the cost of generating new BTCs got constant. Which can only happen if participating nodes needed to exert a more or less constant amount of work (cost) to generate a given amount of BTCs. Only then will people be inclined to actually spend their coins, and they can finally serve their purpose as a stable medium of exchange.
You are totally correct that your fictional linear model can only be saved by adding feedback. But your model isn't reality. Reality already has feedback in place. But that's not it. The very fact that the newly-generated coin supply dwindles as its user base (hopefully) continues to grow will raise that 19% deflation rate even higher. Let alone that many coins are forever destroyed via HDD failures and lost thumb drives, pushing the deflation even higher and higher. High deflation is bad because nobody spends their money, they only save it because it gains value over time. Can you imagine what would've happened if, say, the Japanese government hasn't printed any (or very few) Yens during the last century while the population exploded? One 1911 Yen would have been more than enough to buy a house today. Who then would've spent their Yens in 1911? Why, almost noone of course! This scenario is only avoidable if the number of available BTCs continues to grow with its user base at least proportionally. If both figures match, we won't have deflation nor inflation.
Yawn. Do I even need to say it? Linear extrapolation with no feedback once again races to the moon. Also, bitcoin isn't atomic. We are free to divide it. Even if a single bitcoin will someday be worth eleventy billion dollars, it doesn't mean that we can't peel off a fraction to buy a loaf of bread today. I'm going to stop here. The later part where you want the equivalent of 12 billion new coins produced per day left me nearly speechless. |
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i sure hope you're not saying my pt was silly. i think we're saying the same thing. think about it, if you feel HI is right around the corner, the best thing to do is to go out and take out the largest most leveraged loan you could get, typically a mortgage (most favored tax haven), and buy as many houses as possible. the banks got seriously hurt in the 1970's by giving out too many easy RE loans which got inflated away. this is one of my critical pts; they aren't going to repeat this mistake by leveraging up and spraying USD's all over the economy. and if you don't get HI, how is gold going to go to the moon?
Yup, that would be the most rational thing to do if you were sure that inflation was coming. Not even hyperinflation. Just regular old steady inflation of more than about 4 or 5% would be enough to make that a profitable play. My point was that even if Jesus himself showed up in person to tell everyone that hyperinflation would be starting in a month, housing would not be the place that most people would go to, because they are still smarting from the hard spanking they just got. Because of that, the chart of real estate loans can't really be considered evidence that people don't expect inflation. I have a habit of picking on bad arguments, particularly ones that are made in support of a view that I favor. |
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Also, it is pointless to discuss with Suggester, as he just doesn't get it.
But it's not pointless to come to a thread only to say it's pointless to argue in it? I'm really thankful for whomever added this fantastic ignore button. Keep barking boys, you gotta have at least 2k posts before Christmas. Is it pointless to come to a thread to explain why it is pointless to argue with you? It probably is, but I'm going to give it a try anyway. Your thinking is hopelessly linear. The real world is a messy, complicated place. Many factors come together to interact in complex ways, non-linear ways. Real understanding of the world is very difficult, often actually impossible. So we simplify and approximate. We make models where A causes B, and B causes C. But these models are wrong, and we poison our thinking when we forget that. Bitcoin is a system with dozens of variables, and hundreds of relationships. We know a couple of these exactly. We know a few more to a decent approximation. Quite a few more are just vague assumptions. The vast majority of them are so unknown that we don't even know what we are missing. In summary, your entire conclusion is based on simple linear extrapolations. Ponder this:  |
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whereas the last graph showed a hook with a small gasp of a rebound, this chart has clearly rolled with no signs of coming back up. ask yourself, what is your biggest personal asset? if you're a home owner this one is easy. therefore, if no one is taking out RE loans to buy more houses this means that house prices are going to continue down. if we were threatening hyperinflation, everyone and their mother would be rushing to the banks and borrowing to buy a house (a tangible asset whose loan would inflate away, ie, a free house).  This one is pretty silly. Half the country just got burned badly by the real estate market, and the other half knows someone who did. Even if "Hyperinflation will start tomorrow" was written in flaming letters across the sky, people wouldn't be jumping back into houses. In my view, the people that are sure that hyperinflation won't happen here are just as crazy as the people that are sure that it will. The US economy and the US dollar are seriously fucked up right now. The current condition cannot continue much longer. There will be a change, a big change, and it has a pretty good chance of getting nasty. But, as bad as things are, it is still the best game in town. The importance of this global view cannot be overstated. There will be no apocalypse while the US remains the safe haven. So, while the doomsayers are right that the US appears to be doing everything it possibly can to usher in a serious bout of hyperinflation, it won't happen today, or tomorrow. It might not ever happen at all. |
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Yea I agree with most of this. But there are two types of money, Credit Money( the money you talk about) and 'State' money. Simply, Credit money is derived from 'State' money, and to pay interest on 'credit monies' there must be an ever expanding supply of 'State' money. When I say 'State' money, that could also mean Gold, or other similar token type.
See the bold part. What makes you think this? One physical paper dollar bill would be sufficient to extinguish all debts (credit money), if it was busy enough. |
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What fee it calculates depends on what transaction outputs it decides to use to fund the new transaction, and (I could be wrong with this point) I don't believe it does so deterministically. So there certainly isn't a way to do it without all the information in wallet.dat, and that might not even be enough.
This is correct. I believe the solution is providing an RPC call that creates a preliminary transaction (which isn't broadcast yet), but can be inspected. At this point, it can either be committed (broadcast) or reverted through another RPC call. Yup, but it needs to lock all transactions involved in the potential spend until it gets approval / rejection / timeout. For almost all systems that I can think of, this is worse than just paying the fee and noting the amount later. |
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From accounting point of view, debt always equal to credit. A's debt is B's credit, if both A and B have credit (saving), then there must be some one in larger debt to balance. American government's debt could be balanced by surplus countries' credit.
How do you reconcile this within the Bitcoin economy? Do people with Bitcoin savings owe a 'debt' to some other party? Or can such savings be viewed as loan with zero interest and no maturity? Which is the definition of money. No. Bitcoin is not debt. Dollars really aren't either, but the idea persists. Once upon a time, federal reserve notes could be traded for the equivalent value of gold, so the dollar was a debt that the government owed to the bearer. Those days are long gone, so now dollars aren't really debt any more, since there is nothing that you can redeem it for, except another dollar. So why do we have to pay taxes if the govt can create as much currency as it wants?
Taxes are a tool that help regulate inflation and reallocate financial capital. Hypothetically, yes the government could simply print more money to fund public services, but the amount of money needed would probably cause some sort of dangerous inflation. Given that States with a sovereign currency don't actually need to tax to fund themselves, then taxation performs some 'other' purpose. Taxation is a much more effective method of handling inflation, than interest rates, because taxes can be tailored to target the inflation causing areas of the economy, this is currently impossible with interest rates. Also since America, and most of the world is experiencing economic difficulties, taxation combined with spending, can reallocate money that is not being spent to areas of the economy that will cause spending. That is, taxing people with large sums of money, and giving it to people who will spend. For each financial exchange between people there is a corresponding 'real' exchange between people, and this exchange is the source of economic growth. Government spending would be 100% inflationary, but taxes are a way of destroying money, which sterilizes a portion of the spending. I won't comment on the notion of stealing from the rich and giving to the powerful in the name of the weak beyond saying "ick". |
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This would also slow transactions, and/or not decrease traffic by nearly as much as you expect. The mining pool node is constantly updating its Merkle tree, so a new getwork request includes not just a different coinbase with a new extranonce, but also a different set of transactions, some new. A 64 bit nonce would roughly triple the average transaction confirmation time, unless the node trips the long polling system, which makes extra traffic.
How? Regardless of the nonce size a block will be confirmed on average every 10 minutes. At worst case scenario transactions can always be included in the next block. Are new transactions after the start of a block included in the current block (as opposed to next block)? If so then on average never updating transaction list would add 5 minutes to first confirmation and nothing to subsequent confirmations. If not then confirmations are no slower. If we assume that the average transaction happens about 5 minutes before the next block is found, the current system makes it very, very likely that the transaction will be included in the current block. This means that the expected waiting time for a transaction is just a bit over 5 minutes. With a 64 bit nonce, all mining clients will only update their work every 10 minutes (on average), when a new longpoll hits. So, the average transaction will wait 5 minutes before anyone even starts working on a block that includes it, and then 10 minutes more (on average, of course) for that block to be found. So, the total wait time is then 15 minutes, instead of 5. The worst case, sending a new transaction just moments after all the pools update their miners, goes from 20 minutes to 30. |
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What about the freedom to not drink contaminated drinking water, the freedom to not die from easily treatable conditions because you were born to a poor family, the freedom of social mobility through access to a quality education, and the freedom to live a life where you can be reasonably sure you won't starve?
The reason you are not able to say no is because you also benefit from public infrastructure that was created and maintained by tax dollars. Unless you're saying you would be just as successful as you are now if you had been born to a poor family in Somalia, your arguments for freedom just boil down to a an argument for "fuck everyone who wasn't as lucky as me".
But this is getting way off topic.
These "rights" already exist. Anyone that wants to is free to find or create their own source of clean water, and to treat their easily treatable medical conditions. They are also free to pay other people to do those things for them. But that isn't good enough for you. What you are really want is the "right" to have men with guns force other people to pay for these things, against their will. Your arguments just boil down to an argument for "fuck everyone that doesn't have a bunch of armed men backing them up". |
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