Lending fiat dollars with interest, in the way you're implying, was not the cause of the world economic collapse.



The quantity of money is irrelevant to your question. An economy works equally well with 21m units of currency or 210m units of currency (and of course we know that btc is divisible to 8 decimals anyway).

There is nothing wrong or problematic with "interest loans."  The problems arise from fiat currency and fractional reserve banking. Don't confuse the villains =)

Fixed that for you 

I'm going to guess you didn't even read the OP =)  "Uses" of something do not "back" that thing's value. Gold can be used to create jewelry... but it is misguided to say that usage in jewelry "backs" gold's value. Nothing backs gold - it is a thing in and of itself. Bitcoins are the same, nothing backs them, and nothing need back them for them to be valuable.

Shinobi, is it that difficult to comprehend the difference between coercive centralization (such as with the Federal Reserve) and market-based centralization (such as with a private firm gaining market share)? Are these two things really so indecipherable as to cause you confusion over why those who condemn the former might appreciate and encourage the latter?

Time value varies for every person. One person may have high time value, and another has low time value.

Bitcoin, as a money, doesn't have a specific time value.

If you have a high time value for Bitcoins, then you would require higher interest rates to loan your money to someone else. Similarly, you would pay higher interest rates to borrow Bitcoins in the present.

Put simply, if someone has a high time value, it means they want to consume in the present instead of the future. Low time value means they are willing to delay consumption.

LOL the Bitcoin has been incredibly stable over the past 36 hours or so... what in the world are you talking about OP? 

You do not need to register as a corporate entity in order to conduct business in the US. TH would simple be classified as a sole-proprietor or basic partnership without filing for LLC or C status.

Not a big deal at all.

Transaction fees aren't "calculated." They are determined by the sender of a payment. When you send a bitcoin (or fraction of one) you may opt to pay a transaction fee and you set the fee.

Caveats:
- Some client versions set a mandatory minimum fee per kb of the transaction size. The most recent client version sets this minimum at .0005 btc per kilobyte I believe, and most transfers are 1kb. The older client sets the minimum at .01 btc... and this obviously causes problems for people who haven't upgraded.

- If you use some online wallets (like instawallet or mybitcoin) it appears that you can send btc without any transaction fee. I have done this many times.

All you really need to understand, is that fees tend to be voluntary, but it is smart to include a fee in order to have your transaction processed in a reasonable amount of time. As the market matures, the fee required for a quick transfer will continually fall due to competition. Short term, due to some client issues, some people are paying fees higher than they need/want to.

Hope that clears it up! =)

Tony - Did you add STARE to the wiki list of vendors? I did quick search and didn't see it.

No thank you. I have enough US Dollars already.

Cryptography is obviously integral to Bitcoin's value - Bitcoin would be worthless if the cryptography weren't so elegant or if it failed. But, that is wholly different than saying the value of Bitcoin is "backed" by cryptography. "Backing" has a specific meaning when it comes to monetary instruments.

It will be hard for Dwolla to be "the big winner in the end" when they are just transferring worthless green toilet paper. Bitcoin is a different currency entirely, and you can bet that the open-source enthusiast community of Bitcoin will develop effective, efficient tools faster than Dwolla could ever hope to do.

But regardless, Dwolla and Bitcoin have been very helpful for each other thus far.

Dwolla will always be hampered by the fact that it is not a currency, but rather a means of exchanging US Dollars. Bitcoin is a currency in itself. They are complimentary (though competing) services.

I can vouch for both STARE and the payment system they're using. It's excellent.

Great way to spend some of your coins, because you're not just encouraging Bitcoin usage from a random vendor but you're also encouraging the Bit-pay system behind it. Give it a try.

If I were an optimist, and I am, I would guess that they featured it today because it got significant traffic when they originally posted it. They saw it was popular, so they stuck it on the home page. Probably as simple as that.

I love the title... "The New Currency"  Couldn't have put it better myself.

You misunderstood me. Of course a renovation improves the value of something, but it is not the cost of the renovation which provides value, it is the resulting product - the production - from which the value is derived. Stated differently, if Renovator A spends $100k on a project, and Renovator B spends $50k to get the same results (through more efficient sources and means), the buyer is not going to offer Renovator A more money just because that work costs more.

The buyer of a renovated property cares nothing for the cost of said renovation. He cares only (or should care only) for the resulting product. How such product was achieved is irrelevant to the buyer. There is a caveat... in those cases where learning the costs DOES induce a buyer to spend more, it is because he has learned more about the final condition of the thing by learning of the cost. But one should not confuse this with him caring anything for that cost itself.

Case in point: say you're selling me a used car. I offer $10,000 for the car, based on my assessment of its condition, etc. (Assume I am pretty knowledgeable in cars and can make an accurate assessment).  So I offer $10k.  If, after that offer, you then divulge to me that you had to spend $8,000 in order to get the car to that state, I will not change my offer if I am a rational buyer. Your costs are irrelevant to me. All that matters is the resulting product - I assess and bid on that thing alone, not the consumptive cost of resources which went into it.

The relevancy for Bitcoin should be clear: a buyer of Bitcoin (if he is rational) should only care about the usefulness of the coin itself, or if he is speculating then he cares about the usefulness to someone else in the future. He cares not at all for the costs of the miner's time, or his burden of equipment.

This is why it is false to say Bitcoin's value is "backed" by the cost and burden of mining. Try to sell some hard-earned sea mud and you will see quite quickly that your costs and struggle are irrelevant in the final bidding price.

Dwolla should perhaps set up a USD<->BTC exchange within their own site... bam! That would be successful me thinks.

Ewallets are not a horrible idea. They are a necessary part of the Bitcoin economy. As secure, trusted ewallet services spring up, more "normal" people can get involved with Bitcoin. The fact that Bitcoin allows decentralization and true ownership of your own money is fantastic, but that doesn't mean that it's efficient or proper for every single user to keep his coins on his own computer. Surely you can appreciate a diversity in storage options, right?

Very good find. If I were Thiel, I'd start a venture-capital fund of ten or twenty million dollars to start buying and building Bitcoin assets. Fast. If Bitcoin needs a respected, high-profile public advocate, I can think of nobody better. Bitcoin will be Thiel's "John Galt" test...

The work and resources which are expended on something have no direct relation to the value of that thing. I could spend a million dollars digging a massive crater in my back yard. How much would you pay for that? Probably nothing. Value is determined by supply and demand, not by cost of creating it. This is one of the great economic fallacies that many economists even still believe. You will see many people on this forum believe this myth, when they claim that bitcoins are valuable because miners have to invest money in creating them. It's a fallacy.

And we could not "just as easily use seashells." The entire usefulness of bitcoin comes from its specific and unique properties - and seashells share none of these properties. We value bitcoins not for any arbitrary reason, but because they are so damn effective as a money-commodity. The same is true for gold, though bitcoin and gold have some differing advantages/disadvantages.

The "true value" of Bitcoins is nothing more than their usefulness as things. Society will come to discover how vastly useful they really are, and market price will follow in turn.