I'm quite aware of the foray into Bitcoin CDSs (I hadn't seen the CDO thread). These are fine as they will be toughly regulated by the market, as I said. Call me when they have trillions of currency units (or even millions in the case of BTC) behind them.

In LightRider's defense, fiat money does encourage unwise financial models which in a true free market would be met with tough market regulation and fairly swift penalty (see CDOs, and CDSs). Since interest is morally debatable, it's easy to confuse it as being a non-sound practice.

It is not.


You can if you do it by fiat.


I don't think so.

Actually, there is no problem with bitcoins (or sound money) earning interest. Personally, I don't like interest, especially anything over say 1%, but from a purely monetary perspective a non-inflationary currency can support interest and still induce a sound economy.

People might ask: well, where does new money come from to pay the interest? The money to support the interest comes from within the existing system. This means as more interest bearing loans are created the economy does become deflationary as interest payments are made. In a true free market economy this slows the creation/availability of jobs. At this point new interest bearing loans should be lessened as well, since default risk rises. In other words, the job market should act as a cut off valve for such loans at the point which the economy can no longer sustain them, or banks risk default. The economic problem (and added moral hazard) with interest arises when banks don't accurately fear default, due to either creative financial mechanisms (like CDOs, or credit default swaps), or assurance of being rescued (by bailouts). A true free market allows lenders to go bankrupt when they run afoul of the actual tolerance of the free market.

Not bad.

I agree with FreeMoney. I think you might do well with slightly bumped up content. Maybe solicit people to email you with questions or comments which you can then comment on. Some sort of audience interaction might be good, kind of like a radio show. Then tighten up on your speed/delivery of topics. Keep it up!

@OP - how much did Bitcoin get from the "pawn" shop?

You know what, on thinking about that Libertarian Convention thread... if this article could be converted into small pamphlets and distributed there it might go over well I think.

This isn't only the best thing I've read on Bitcoin, it's the best thing I've read in a while, period. Informative, funny, cogent. Nice job! I actually got a chill from the last few sentences.

I have to re-post a few of my favorite lines:




There was also a line about a "decree by Bernanke" that I can't find, but for some reason made me laugh.

You also nailed the why Bitcoin is valuable question.

This should be spread far and wide.

Wow, haven't finished it, but it's really good.

I think it's just too much of an uphill battle.

A bitcoin vendor would have to pay to be at the convention, take out time to be there, then while sell little to nothing while trying to explain what bitcoin is.

The 0.9 BTC trade probably looked suspicious (as in low risk test), like a bot.

The eye candy images seem to be an inherent part of the site. It looks like an electronic version of a women's gossip/shopping club - which is actually pretty smart and naturally viral I think.

But pleasing images are not key reason people go to that site. You can find plenty on Google Image search. People go there for what the images represent, and how they can affect/improve their own lives. So, I guess in a way bitcoin could be relevant, but the challenge would be how to convey that in an easily understandable "pin up"  

That page shows ~ 20 people interested in bitcoin out of a site of 20 million users... not exactly what I'd call good percentage of their userbase. The site itself is interesting, though.

Indeed.

The Bank of Canada Has Virtually No Gold Backing the Canadian Dollar

You were not talking about gold or silver?


Bold emphasis mine. Hard backed means backed by gold or silver.

http://en.wikipedia.org/wiki/Hard_money_(policy)

Anyway I've got to log off now. Be back later.

People readily converting paper back into the right amount of gold, at anytime, wouldn't require anything enforced? Surely at least a few guards would need be present

We're talking semantics, but I agree "honored" is a better word to use there.

You keep talking about a "backing currency" but we were originally talking about hard backing. That means gold or silver.

We have a missed communication on the word "enforced". I meant the government would honor and not change any convertibility into gold, not force people to use the currency.

LOL

I had a feeling someone would call me on that

Yes, I'd agree, but we are still a long way from Cuba. 

You have a misunderstanding of what exactly a gold standard is. A gold standard is the opposite of the government saying what money is, because people already view gold as money. If a gold standard is enforced then the government is restrained from growing by inflating the money supply.