If I blow a kiss, does it exist? Even if I don't know, can't see, don't interact with the recipient? If the only record of the kiss is verified by people I've never met, who've never seen, touched, or in any way interacted with me directly, does the record prove the existence of said blown kiss to an anonymous potentially non-extant recipient? Existence is purely up to your own interpretation.

encryption device
advice
crafts
basket of currencies
loose tea
home cooked dinner
silver
oh, and a dog sitter while out of town

Ah, therein lies the rub!

M3 is contracting, M0 dollars are appreciating. As long as USD/UST is the best game in town, considering Asia's dependence upon cheap exports (devaluation), Europe's real risk of default, demand and confidence will increase for green dollars. I think we're looking at global fiat HT within the decade, but dollars may be the last fiat standing.


Ten98 was unclear at best or simply mistaken, because there is no such thing as "built-in price Deflation". Sure, I've called lost wallets "ooops attrition".


Deflation discourages debt, encourages savings, from which real investment comes.

We've rarely seen deflation in modern times except after the collapse of an inflationary bubble. But ancient Egypt, one of the strongest and longest standing civilizations in human history, had during most of its existence deflation at best and stability at worst. Rome was standing pretty well until they started devaluing their metal currencies. The United States was strong for the first century under a deflating currency.

Yes, an advertisement.

INVALID BBCODE: close of unopened tag in table (1)

I've just finished Adam Fergusson's 1975 book on Weimar Germany, Austria and Hungarian HT. The parallels are alarming and the US is not at war to the extent of WWI and German's reparations, though current US military budget approaches Germany's debt to Versailles relative to GDP. However, as has been pointed out various times in this thread, higher aggregates will evaporate in our economy, which was not possible in the Axis economies. Paper money just kept piling up.

What we are seeing and I think will continue to see are larger and larger bubbles and busts. Investors will be scrambling from one volatile market to another. The dollar is strong, and the UST are selling like hot cakes, in my opinion because it's the only game in town. Europe is not credit worthy at any interest rate and Asia (and everyone for that matter) is depreciating their currencies to prop up exports. In this environment the US can get away with issuing more bonds while lowering its interest rates by buying them with new dollars. The inflationary risk of UST is stifled by the massive flight from the euro.

Catch me please if and where my logic is unsound.

The US has created a very risky but profitable scenario. They will continue to issue bonds, indeed they must as long as the budget is unbalanced, and can keep the rates low by buying many of them back with new M0, thus slowing down the appreciation of the dollar which will be applauded by the US export industry, workers, and politicians. I don't see what would pop this transparent ponzi bubble. As long as the USD appreciates against gold, money will continue to flood in to the US, interest rates for many foreign bonds will increase until default, which will pump UST even more.

What possible scenarios would decrease demand for UST and what would force the interest rate up?

What I propose could also be run over Tor, but solves the one-way-only issue. Currently all nodes broadcast their own transactions in plaintext. By simply sending 75% of transactions encrypted and rebroadcast 25% in plaintext would drastically reduce the ability to connect addresses to IP address, while still allowing incoming ports. If people need Tor, they'll use Tor. For the rest of us, we just don't want lists of (political contributions, flowers/chocolate/porn/engagement ring purchases, donations, Google tracking) by IP address.

Very nice charts. Perhaps you can add the new mix of exchanges. Ruxum comes to mind.

Bitcoin could implement a Tor-like network itself. Any node can encrypt a transaction and send it to any number of nodes. Any node can and should eventually send transactions in plaintext, either their own or from other nodes. No node will know if a transaction comes from the sender, the sender's sender, or numerous hops away.

Although less robust, and risks spamming, the transactions do not need to be onion wrapped. Any node may refuse an onion wrapped transaction from any other node (if it believes the node is a spammer).

The utility of cash stems in no small part from its anonymity. We don't want any hassle when we pay the baby sitter, tip the bar tender, give a congratulatory card. The lack of counter party risk is directly related to the fact that it can't be traced and thus undone. Anonymity is not about the dark shadows but of immediacy and finality. We don't pay friends with credit but with discreet honest value.

Monetarily bitcoin will never be deflationary, unless you consider ooops attrition. Bitcoin is likely to appreciate due to increased demand for its utility. IFF bitcoin becomes wildly and globally popular, then fiat currency will inflate itself out of existence, with increasing supply and inferior utility, thus decreasing demand. The fight is on!

The balances of all addresses will be far less than a gigabyte for quite a while. Today there are 150000 transactions with rarely more than 100 addresses, the majority of which are not unique in the block chain. And the majority of known addresses have a zero balance. Each address and balance is about 50 bytes. I'm guessing, if we drop zero balances, the total list would be less than 100 MB today.

EDIT: The firstbits algorithm, plus simple compression could bring each addresses and balance to about 7 bytes. My new guess is the entire block chain balance sheet could be compressed to 10 MB.

Bravo!

(thUSD failed to deliver )

It is reasonable that there will be situations where you would accept bitcoins without having network access. Indeed, no net access might be precisely why you are using physical bitcoins. From the extreme case of revolution/war, to simply a month out at sea, or up in the Arctic (uh, playing poker or something).

The face value of the coin is dependent upon trusting that the minter did not copy the private key, that the tamper resistant seal is truly irrecoverable, that it can't be x-ray/laser scanned, that the coin is not a counterfeit, and perhaps other attack vectors of which I've not thought.

So while any of those attacks might have occurred before or during your adventure off the grid, there is still piece of mind checking the balance of the public address against an offline block chain.

That might be a cool alternate client. In fact, I'd love a desktop application that let me trade on numerous exchanges simultaneously, shifting bitcoins between each.

Bitcoin will die if it is marketed and perceived only as an open source credit card, Google Wallet, Pay Pal, transaction, paper cash competitor. Bitcoins are unique, revolutionary and valuable as they stand.

Kudos Gavin and Dev Team!

Our first Google Wallet customer (YouTube)

5% over spot is an excellent deal. Couldn't you automate that price? Do you want help with the programming?