how is fiat totally anon face to face? even if you use cash(unless you found those cash on the street lol) you need to withdrawal them first from atm, and any withdrawal like that is monitored

Thus you freeze the money in both cases, right? Then why did you raise the issue of "frozen" money at all?

Are contract killings also legal agreements?

Point of "smart contracts" is you will no longer need law enforcement for all the things that can be auto-resolved by simple "if - then" rules.


Why the hell would anyone use paypal instead of bank-to-bank transfer? Why the hell would anyone use bank-to-bank transfer instead of using cash? Why the hell such middlemen exist?

Reduced costs? Convenience? Anonymity? No restrictions? Speed? Discounts?

Okay but your theory falls apart at the Billion USD worth of coins at the ATH price that never moved.

I was responding to another post about theoretically having automation of labour, that would only require 5% employment.  That would require a huge push in R&D, which would need to be driven by tech guys, because who else can do it?

Tesla was privately funded until 2010 I believe.  So throughout the financial crisis, when they came very close to bankruptcy, the government didn't loan or grant Tesla anything.  In 2010 they received a government loan, which has already been repaid in full, with interest.  Then I believe they received another loan to expand their production capacity, and tax cuts from Nevada from building the gigafactory over there.

So the problem with Tesla right now, is their production capacity.  They were only able to do ~33,000 cars in 2014, and will approximately double that in 2015.  But still, they are a drop in the bucket in global car sales.  So it's going to take a few years at the current momentum to be a big player in the industry.

Their GAAP financials will be normal COGS subtracted from revenues...what are you speaking of that's misleading?  They have a lot of automation, and literally form the body out of raw sheets of aluminum, so their production facility is pretty efficient.  Check out the videos if you're interested.

Yeah, I'd like to pick up some TSLA shares at this point, but all my USD are invested right now.  I'm Canadian, and I don't want to convert CDN to USD right now because the exchange rate is ridiculous.  I'll need to sell off some GOOG shares to free up some USD, but I missed the boat at $570+ a couple days ago.  TSLA is a super volatile stock, because it's valuation is based on bets about the company well into the future - so very speculative.  

LOL okay, I think you forgot that Satoshi never sold any Bitcoin and when he made it, it was an experiment not meant to be a money maker, it wasn't even worth a penny a coin at the start!

Options are not "smart contracts". A smart contract automatically resolves itself. Options need a third party clearing house to be resolved. The clearing house in the U.S. is the OCC. It couldn't be more centralized and "dumb".

DAO's are not a new concept. A very old example of a DAO is the The Underground Railroad, which was a network of persons who helped escaped slaves on their way to freedom in the northern states or Canada.

Bitcoin is a DAO. It is a payment processor like Paypal and all the others, but it is owned and controlled by nobody, and it is decentralized.

A commercial bank is a corporation. It is owned and controlled by people. A "distributed autonomous organization" is not owned by anyone and it is not controlled by anyone. A commercial bank is not a DAO. Imagine a company like Uber that wasn't owned or controlled by by anyone. That could be a DAO.

The machine-to-machine transactions that we care about involve autonomous decision making. The example of internet transactions and ATMs misses the point. However, machine-to-machine transactions do already exist. For example, high frequency trading systems buy and sell stock without any human control or interaction.

@twiifm i hope they are understanding when they miss out on the next bitcoin rise

I'm not sure what the relevance of your response is.  The thread is criticizing the financial system itself, and I brought up Tesla as an example of great technological innovation. 


Please share your source and non-GAAP margin numbers for Tesla with us instead of using analogy.  For the past 6 quarters, Tesla has had >25% margin reported.  You do understand that non-GAAP allows more flexibility in reporting than GAAP does right?

There's nothing wrong with telling people not to invest during bubble highs, but to say that Bitcoin has no value is intentionally misleading. I think your continued feeling of self-importance over saving people from their own stupidity is preventing you from seeing Bitcoin in a balanced way, unfortunately.

If you really think Bitcoin has no value, why have you been wasting your time on here for the last year?

Ah, the ultimate argument when it is shown that all principal effects of inflation and deflation are economically essentially neutral and mirror of each other if you take all effects into account.

Point is, stickiness of prices are only valid in the short term.  Otherwise, nobody would even be willing to pay $1.- for a loaf of bread, given that we are used to 10 cents for it !

Stickiness of prices is just as well an argument against inflation as against deflation (and in fact, implies that inflation and deflation should be MILD).  Consumers DO adapt to higher prices in inflation.  They are not holding on to any "stickiness" in the long run.  They adapt to the market: if there ain't any more at the old, lower prices, they are willing to pay higher prices.

The stickiness of prices in wages and so on only comes about because of LEGISLATION which does some kind of price fixing.  If those prices were just as free as a loaf of bread, and the labor market would be fluid, then wages would adapt just as well as the price of a loaf of bread.

If you have an inflation of 2%, you have an effective wage drop of 2% a year, and you have to negociate a wage increase to keep the same effective wage.  If you have a deflation of 2% a year, you'd get an automatic wage increase of 2% a year.  First of all, that is not so terribly uncommon.  And second, there could be wage lowering negociations from the side of the employer.  They would in times of deflation be just as natural as wage increase negociations in times of inflation.

There is no long run stickiness of prices.
Markets always impose prices.

On a thread where there is criticism given to a our monetary system and money itself, and your input about an example for technological innovation and automation is about money and profits, then you likely missed the point.

Tesla is not profitable and doesn't plan to be profitable for the next few years.  They are having to invest in infrastructure to grow production capacity and distribution, which Tesla has explicitly mentioned takes precedence to being profitable.  He mentioned they're making about 25% gp, which is very profitable for the auto industry.

You've made it clear that you're not a fan of Tesla, but no one needs you to be one.

So BIT started taking money in October 2013 right? And BIT investments made up until March 2014 are eligible for sale now, right? The problem for GBTC buyers is that the BTC price quickly skyrocketed after October 2013. There may not be much supply anywhere below a $600/BTC rate unless people were patient enough to lockup $25,000+ USD for over a year only to sell now at a loss.

Wrong.

Even if the BIT investors bought BTC at a $1000/BTC rate, they can sell through GBTC at a small premium (e.g. 5%) and immediately buy BTC. Then they will increase their bitcoin holdings without risk. Every single eligible holder will have an incentive to sell as long as demand is higher than supply (creating a premium). The market is waiting to see if demand is, in fact, higher than supply.

In fact the productivity is already enough high for most of the people to retire early, but due to the existance of money and exchange, this can not be done

Imagine an island with two people Bob and Alice. Bob is very smart and can produce 10 times more products per year than Alice. In today's monetary system, we suppose that Bob will earn 10 times more money than Alice (Money is used as a unit of value)

But that is simply not possible, because Bob's income can only come from his sale to Alice, and Alice have much less productivity thus much less income. As a result, Bob's income is limited by how much Alice can spend

The current solution is government charging heavy tax on Bob and give them to Alice so that she can buy more Bob's products. It also means that Alice get more income than her production, because of Bob's high productivity

Or, government take loan to run infrastructure projects, give Alice enough income to buy Bob's products

Anyway, the core of the problem is: High productivity people can not fully utilize their efficiency due to low demand from low productivity people. Unless they give up some of the productivity for free, there is no way to reach 20% employment

If Bob is not profit oriented, he can max out his production thus maximize the social wealth, but he won't have enough motivation to do so, since redistributing his products to Alice is more like a donation. Money is that motivation: If Bob can exchange all his production into money, he has some motivation to produce more, since money will store value and delay his consumption until a later time. Unfortunately, since Alice have little access to money, Bob can not make money by himself alone

So there are a few issues keeping us from going towards this automated economic model.

1) We don't have enough people on the tech/r&d/engineering side currently, so we would need many more people to be educated (in or out of school) in coding, software development, robotics, engineering, etc.
2) What happens to the rest of the people that are useless in the new system?  They are the majority.
3) In this system, only companies that actually produce or optimize goods/services are useful - so things like financial services, which don't really produce anything but take a cut from everyone that does produce, will need to
4) How are resources distributed for production?  Ideally it should go to the most productive and beneficial options.  Then once goods are made, how are they distributed if the majority of the population doesn't make income?

We are currently so primitive compared to the type of world we're dreaming of...I mean like you said, we have the money printer going and engage in war.  Could you have any stupider people leading the world?  Once you've conditioned an idiot to think he's doing good by killing another person that he's never met, something's very wrong.  In the new world, that idiot would need to be programming a manufacturing robot. /end rant.

For the transition, I think the tech companies will have to set the stage and compete solely based on technological innovation.  Elon Musk is making a huge push for tech companies to expand into other industries, and I really think when you have brilliant minds, they can take over whichever industry they please. 

I feel we are arguing past each other. That's probably my fault as, as I said, I hadn't analysed profit.  I had a sleep on it but likely should have spent another night on it, sorry about that. Let's recap my (and many others) claim that inflation and deflation are mirror images.

In my original post #170 I said,

"Inflation favours those with debt while penalising savers.
Deflation penalises those with debt while favouring savers."

I think we can agree on that, yes?

I followed that with,

"For every argument for/against deflation there's a symmetric argument against/for inflation. So it seems to me 0% is best as it favours neither."

Thus implying they are mirror images.

You came back with an argument (#176) about profit turning negative, yes?  (I then started trying to form a view about profit. That, I think, was a mistake, on my part).

The thing is, that profits can turn negative under deflation is not an argument against my conjecture, AFAICS.

Profits relate to a producer. A producer's mirror is a consumer. Those are the symmetric entities I should have identified, and be debating. So let's do that.

My claim is that if inflation favours the producer (and so disfavours the consumer) then deflation disfavours the producer (and so favours the consumer).

But it seems to me that you've already argued deflation disfavours the producer, yes? And I assume you're of the opinion inflation favours the producer, yes?

So we are in agreement on this, yes?

Of course that doesn't prove my conjecture, I know.

Anyway, I'll leave it at that for now, and wait see if you agree my points so far,