This is another one of those arguments where you focus on just one side of a transaction to come up with a skewed view of the transaction as a whole. For every such an argument, you can do the same thing for the other side of the transaction and come up with an equally bogus argument that makes the opposite point. For example: Loans are such a great deal for the poor, they get to spend rich people's money.

From the opportunity value. Ten dollars today is worth more than ten dollars tomorrow because everything you can do with ten dollars tomorrow you can do with ten dollars today plus you can spend it before tomorrow. When you loan money, you transfer the money from someone who has no way to extract the opportunity value to someone who can and they split the surplus.

You could also ask why it would be fair that one person produces more value than another and gets the same pay.

No, not at all.

Say you work as a laborer. Your work sucks, it's hard work in the hot Sun. You get offered a job as a pizza delivery driver. You have air conditioning, you get paid more. But you don't have a car and you need one to work as a driver. You could spend the next few months living on even less to save up enough money to buy a car, but that makes no sense. Instead, you borrow the money to buy the car. You pay the interest out of the value of the car which enables you to get a better job.

No, it doesn't mean they have to work more hours a day to pay the interest on money unless they take unwise loans. If, for example, you borrow money that allows you to get a better job, you may work fewer hours. Don't blame wasteful consumption on bankers.

How can you return the bitcoins if you've already released them? Presumably as soon as the seller confirms that he has received the funds, you will release the bitcoins. Right? How long will you hold them just in case the buyer claims the fund transfer was unauthorized?

Honestly, I don't see how you add any value whatsoever. All you do is switch the type of fraud from not sending the money to sending the money and then charging it back or from not sending the package to sending a package with rocks in it.

Now, maybe that's just me. Maybe other people would find such a service useful. Personally, you would have to provide me with extremely detailed policies and procedures for how you would handle each case before I would trust you with anything. "We might do this, we might do that" won't cut it. That's not how real escrow services work.

I agree with that. However, see my post above. If you don't loan your money out and someone else does, you will turn 100 bitcoins into 100 bitcoins while someone else turns 100 bitcoins into 108 bitcoins.

You are entirely correct in the case of, say, a government printing money. However, this is not correct in the case of loans. The people who get the money pay it back with interest. They get purchasing power today (presumably when they need it more) in exchange for foregoing purchasing power in the future when they expect to need it less.

If people are willing to pay interest, it will typically be because they can make better use of the purchasing power today. Loans help people to efficiently time-shift consumption and production in cases where the most efficient pattern isn't produce-consume.

The obvious example is the guy who gets a job that pays 20% more than he's making, but he needs a car. He can't produce the value he needs to consume in the form of a car without the job. A loan allows how to consume the car now when he needs it, and produce the value of the car later when he will most likely be able to.

Certainly banks do some bad things and certainly people take bad loans. But the fundamental logic of banking and loans is completely sound.

We agree that some innocent party must bear the cost, right? So the only question is whether it's TradeHill or Dwolla.

Well let's look at the agreement between the two of them. Dwolla said their transactions would be like cash. TradeHill asked if there could be chargebacks and was specifically told no.

I agree that it's not Dwolla's fault that users are initiating chargebacks with their banks. But I disagree that Dwolla's only choice is to reverse the transaction to TradeHill. Dwolla could eat the loss. If you don't think they can do that for some reason, please explain how that reason doesn't apply equally to TradeHill.

In fact, I don't believe Dwolla can reverse the transaction with TradeHill. That transaction was authorized by Dwolla. And Dwolla is not alleging any fraud on TradeHill's part. So I see no grounds for them to reverse it.

If I cash a check from Jack and use the money to buy a steak dinner, I can't ask the restaurant for my money back if the check bounces. I have to go after Jack for the bad check.

(As I explained in the other thread, Dwolla still doesn't claim the right to pass on chargebacks to innocent third parties. They only retain the right to chargeback the initial account and to claw back funds prior to arbitration.)

You're close. But you are incorrect that borrowing takes a double whammy. Yes, of course you pay interest when you borrow. But the deflation cancels out. You benefit from the deflation on the borrowing end, because the bitcoins you borrowed are worth more to people today because they are expected to deflate. This cancels out most of the whammy on the deflation when you go to pay the money back.

To put it another way, expected deflation will make people want to hoard bitcoins so they can spend them later when they are more valuable. But they will also make people want to pry bitcoins out of other people's hands today so that they can hoard them. You will be borrowing these highly desirable deflating bitcoins that others will work very hard to get from you so they can sit on them. This partially cancels out the higher value of the bitcoins when you have to pay them back.

No, I am saying that if you simply hold onto your money, the opportunity value is lost. Whereas, if you deposit the money in a bank, you can extract the opportunity value.

True. That is the downside of a bank. However, the upside is that you don't waste the opportunity value of the money.

No, that's not what I'm saying. If you hold onto the money, you cannot use it unless you find some way to extract the opportunity value. If you cannot do that, and in general you cannot, that value is wasted. A banker is an expert at extracting the opportunity value of money.

I would say that if you have it, you can only use it when you want. But if you don't want to use it, the opportunity value is wasted. This is value to which you are entitled that you are simply giving up for nothing if you hold the money.

No, it is increased. That's how the bank pays you interest.

Look, say you have 100 bitcoins and you don't need them until next week. Say someone else needs 100 bitcoins right now, badly enough that he's willing to pay back 110 bitcoins next week. If you hold your 100 bitcoins, you lose the 10 bitcoins of opportunity value you could have made by loaning those bitcoins out. Even if you say "well, then you risk losing the whole 100", you can easily imagine a situation where you could also obtain insurance against loss of your principle for, say, 2 bitcoins. So you still waste 8 bitcoins of opportunity value by holding your bitcoins, and the guy who could have done something with the bitcoins today doesn't get to do that either. Lose/lose. (But then the fewer bitcoins in circulation do benefit some people, so they win.)

Actually, more likely someone else will lend the guy the 100 bitcoins. So he'll have 110 bitcoins less 2 for insurance and you'll have 100. You're playing the sucker.

Consider:

1) The item is a diamond ring. The buyer says he opened the package, it was empty, and he refused it. The seller says he shipped the ring and got back an empty, opened box. What do you do?

2) The item is bitcoins. You know the seller shipped the bitcoins. The buyer claims the payment (PayPal, credit card, whatever) was unauthorized. What do you do?

If you don't solve the actual problems, what am I paying you 2% for?

Some of them are, some of them aren't. If you don't store your currency in a bank, the opportunity value of the held currency is forever lost.

Will you give me 100 bitcoins today if I promise to give you 100 bitcoins next year? Of course not -- even if you 100% trust me, you're still giving up the opportunity value of being able to spend those bitcoins within the next year should you choose to do so. There's no reason you should give that up in exchange for nothing. If you hold your bitcoins, that's exactly what you're doing.

It cannot work that way. 10 bitcoins today includes the right to have 10 bitcoins at any point in the future one desires. So 10 bitcoins will never be valued at less than the net present value of the expected future value of those 10 bitcoins at any point in the future.

You are thinking that bitcoins have a certain market value and then they have some extra value due to deflation. But this is not true. The market value includes the deflation value. There is nothing extra to use to offset the interest rate. The value from the deflation of the borrowed coins was part of what was borrowed from the bank and must be paid back to the bank in addition to the bank's interest.

Say an ounce of gold is generally expected to be worth $3,000 next year. Regardless of the present value of an ounce of gold, if you borrow an ounce of gold from me, you are borrowing at least the right to have $3,000 next year and I would insist that you pay me back at least the value of that right plus interest.

Check if you see the transaction in block explorer first. If you don't see it there, it hasn't happened yet.

I would say they're all comparable. Just realize that every bit of random data in your private key you replace with less-random data means your key is that much weaker.

If you want to be super paranoid, you can do this:

1) Compose a string consisting of a random 256-bit portion and a memorized portion.
2) Store the random 256-bit portion in your vault.
3) Use as your private key the SHA-256 hash of the two portions.

This way, your key still has 256-bits of pure randomness in it, so you haven't made it any weaker than a normal private key. And now an attacker who gets the 256-bit portion still doesn't know a single bit of your private key and must brute force the memorized portion.

It depends how you got those bitcoins. If you received them as a lot of small transactions, the consolidation transaction will have to gather them all which may make it large enough to require a transaction fee.

That was what they claim, but that is not what they do.

Of course not. If you could still spend them, how could mybitcoin credit them to you?

Something went horribly wrong when Berkeley DB configured itself. It should have added this line to db_cxx.h:
#define   HAVE_CXX_STDHEADERS 1

Did you try restarting the client with a '-rescan' flag?

The accounts are basically mythical. The fee is taken from your balance. Which account it is debited from is a meaningless accounting issue. The client only "sort of" tracks funds by account.

There are bitcoin addresses that people send money to. Each address has a corresponding key. There is a very real "balance" that can be claimed with that key.

The bitcoin client knows all the bitcoins its funds can claim. For convenience, it separates them into accounts. When money is sent to a particular address, the client credits it to the corresponding account for your convenience.

Other than that automatic crediting of the account an address is associated with, the account balances are mythical.

Does anyone know which block the ASCII is in?

What possible difference could the frequency of hack attempts make? Do you investigate every attempt?