1. Bob has 10 apples.
2. Cindy has 2 apples.
3. ? ? ?
4. Cindy is 5 times MORE RARE than Bob.
10 apples have 1 Bob 2 apples have 1 Cindy Is Cindy worth more than Bob? There is 1 goldsupply, there is 12.7 mil bitcoin supply. Bitcoin is 12.7 mil less rare than 1 goldsupply If all Apple trees go extinct and you held the last apple on earth and there was no possible way to reproduce it. How much would that Apple sell for? |
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Attempting to back Bitcoin with gold would be like trying to back gold with silver. The bitcoin doesn’t need any help in the value department.
Yes it's total nonsense. You can always ask: What's backing gold? And then you will come to the conclusion, that gold is backed by nothing else than the effort needed to extract it from rocks. Creating bitcoin requires effort (energy), too. So bitcoin mining perfectly resembles gold mining on a virtual level (hence the term "mining" is used). The concept of backing only makes sense when you have items like paper money that you want to have high trade value but that do not need much effort to create. Bitcoin is unlike fiat money that can be created at will. So Bitcoin does not need backing. Bitcoin is sound money like gold. Except BTC is code so it can also easily be altered. 51% attack and all that |
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Kinda surprised Larry Summers withdrew. Maybe he was too vocal and Yellen was more "safe"
No, I think he knew that there is no way out of the QE-Experiment his predecessors have started. Yellen will be the scapegoat when this giant ponzi-scheme collapses. Its not really an experiment. They saw Japan do same thing in late 80s and all the way to current times |
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Question:
I'm a farmer and have 100 apples. Am i correct in that I can issue 100 shares for my apples?
When I sell an apple colored coin what happens to the coin when the apple is eaten? Does the time-stamp just act like a receipt?
The investor can redeem his coin by going back to the farmer: the investor gives his apple coin back to the farmer, and the farmer makes physical delivery of the apple. The investor is now free to do whatever he wants with the apple (eat it?), and the farmer can either keep the coin or uncolor it. Let's say I want to grow an apple tree. I need money for fertilizer, insecticide, and water. I can supply the seed, the land, and the labor. So to raise money for this venture I sell applecoins* expecting to get a yield of 1000 apples in a season (we have fast growing trees). I sell 100 colored coins to cover those costs and will give each colored coin owner 5% of the yield rounded down to the nearest whole apple and then will offer a discount on apple pie to the applecoin holders as well. To redeem the colored coins for the apples, you must send them back to me.
Yes, this is a very good explanation of how colored coins work. To summarize, the colored coin comes into existence when the issuer issues it, and disappears when the issuer redeems it for a service or good. Well thats good. It works like traditional banking. But why does it need BTC why not color dogecoin or litecoin? |
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I'm also critic of the FR, but from a formal point of view it doesn't destroy the link between credit and debit. One man debit is another man/entity credit. So at which point is the "money" to repay the interest on a debt created? Since all fiat money is created out of debt (the central bank creates money by lending to banks or, in certain countries, directly to the State), interest creates new debt that can only be paid by borrowing more, supposedly supported in future income grow (think about corporations). It's because of this that no modern economy is prepared for a long economic stagnation. Interest debt can only be paid by someone getting more loans and that can only be supported by economic grow or inflation (nominal grow). Any long stagnation creates a financial crisis, solved by inflation or defaults. I agree but if you want free markets its gotta be this way. How are you gonna stop people from wanting to enrich themselves through profit? Communism didn't work. |
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@ozziecoin
LOL not even close. Just because I like to learn doesn't mean I'm in school. Try it sometimes
If you understood options trading you would not make a dumb statement like that about Taleb betting against me. It doesn't even make sense. You don't even know how I trade or what my positions are. Furthermore traders sont bet against each other as individuals just the options have 2 sides. Its not a chess game its a market. Besides, Taleb retired from trading its impossible for us to ever cross paths
Wait so you respect Soros for gaming the system, but not every other banker for gaming the system? All Wall Street guys game the system. Thats how they make money since they don't produce anything
You trying to impress me by name dropping Minsky? You know he's considered a Post Keynsian right?
None of these names you dropped says anything about FRB being responsible for economic crashes.
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Well they can't refuse cash so they have to accept it if that's what the customer wants to pay.
How can employees steal if the they use cash registers? If the receipts don't balance out then the employee has to pay out of pocket. This was common when I used to work as waiter.
Most businesses don't care about interest. They usually just have checking account. They need cashflow for payroll, supplies, pay vendors, etc..
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Question:
I'm a farmer and have 100 apples. Am i correct in that I can issue 100 shares for my apples?
When I sell an apple colored coin what happens to the coin when the apple is eaten? Does the time-stamp just act like a receipt?
When the apple is eaten, the counterparty assigns it to another apple or recolors it. So for clarity, the buyer destroys the coin upon taking possession of the apple? or only after the apple has been eaten? The colored coin was an apple future. He exchanged it for the apple. He's not describing a futures contract, he's describing a voucher. Just use Groupon if you want to sell vouchers Colored coins can represent vouchers, futures contracts, or many other things; it's up to the issuer to decide. Colored coins are unlike anything that has ever existed before. They allow people to create and trade assets like apple futures contracts, shares in a company, or IOUs for gold stored in a vault, just to name a few. The open-asset protocol is what allows these assets to be subdivided and freely traded without the need for the issuer to record and account for the trades--the protocol does this for him. Colored coins will be an exciting addition to the bitcoin ecosystem. I understand what colored coins are and they sound cool. However the apple seller doesn't sound like he wants to write a futures contract. He wants to write a voucher. But since his business is a startup Groupon is better for him since they can also distribute the vouchers to their user base so he doesn't need to do his own marketing. I don't know if he really wants to sell apples or its just an example. Personally I think its a terrible business plan to secure financing by selling vouchers. He's better off using a presale model like Kickstarter if his goal is to raise capital. Either that or just take out a business loan The other thing to consider is even you can color coins for futures contracts why would you want to? Most people who trade futures prefer cash setlled and trade them for speculation. What they care about is liquidity. If the colored coin transaction takes 10 mins, the market makers will be forced to widen the spread which will make them unattractive for trading. Plus there's already mature exchanges for futures. What is the advantage to using blockchain compared to what we have now? It has the same problems of bitcoins. Why bother using it when there are superior options like credit cards and ATMs everywhere. |
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@ozziecoin
Again you know not of what you speak.
Keynesians are not neoclassicists. Keynes wasn't a monetarist either although a monetarist like Bernanke could also be Keynesian. However, Friedman, the father of monetarism, was definitely not Keynesian
LOL. I don't have solutions to the worlds economics problems and never claimed to have. However, at the least I understand economics so I don't go around talking about "evils of FRB". That would be plain ignorant. The only thing I try to post on these boards are factual knowledge and I debate those who post misinformation.
Wait so now you are quoting Soros and Shiller? LOL cause I happen to follow Soros Institute for New Economic Thinking and I'm taking Shillers Coursera class. How can you follow these people and be so misguided? You do realize that Soros is part of the 1% that you seem to hold so much contempt for.
Weren't you the guy who told me to follow Taleb cause you think options trading is for schmucks not realizing Taleb got famous as a renegade options trader?
Are you just pulling these names put of your ass to sound intelligent or do you actually read what they write?
I don't subscribe to EMH. But the GFC had nothing to do w FRB and something like BTC won't prevent bubbles and crashes either. If youre so keen on Shiller you would already understand that bubbles are the result of psychology and behavioral economics not monetary policies. The QE came after as a response to bubble crash
Also you keep interchanging private debt and govt debt. They are not the same thing
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It doesn't matter if there are only 21 Million coins because they are divisible.
Bitcoin doesn't encourage hoarding, it encourages sensible spending.
Our current financial model is.....I want that Aston Martin today....I dont have the money, I'll get a loan
With Bitcoin the model is, I have the money today or If I just wait two years, the Price will go up and
I'll be able to buy the car AND have some bitcoin left.
Bitcoin, being deflationary Encourages sensible spending, rather than hoarding.
I imagine everyone on here has bought stuff with Bitcoin.
Why spend it in 2 years when you can wait 2 more years for price to go up even more? In fact just never spend it and when you die pass it on to your kids. In theory price will rise to infinity no? |
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Question:
I'm a farmer and have 100 apples. Am i correct in that I can issue 100 shares for my apples?
When I sell an apple colored coin what happens to the coin when the apple is eaten? Does the time-stamp just act like a receipt?
When the apple is eaten, the counterparty assigns it to another apple or recolors it. So for clarity, the buyer destroys the coin upon taking possession of the apple? or only after the apple has been eaten? The colored coin was an apple future. He exchanged it for the apple. He's not describing a futures contract, he's describing a voucher. Just use Groupon if you want to sell vouchers |
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It all depends. How much money are we talking about? How long of investment and what's the expected return?
If you wanna make 1000% percent return in one year then yes speculate because no investment will give you that kind of return. However understand that you could also lose it all so don't bet your house on it.
If you want a guaranteed return in 10 years buy a bond. If you have good credit and want monthly income buy a rental property and find tenants. Or buy a basket of dividend stocks and collect dividends.
Even for speculation I don't think BTC is as good as options because it's not easy to quantify risk. And doesn't give you any flexibility
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I lost all respect for odolvlovo with his comment ^^^^
Since you obviously know more and better than Yellen, why aren't you running the Fed?
+1. I was skeptical of Yellen, but she has said a few things that make me tentatively respect her. Also, though we might disagree on certain things, she came to her point of view through a lot of experience and knowledge. Might she be wrong? Absolutely. That being said we should consider what she has to say carefully. My main problem with her is that she continues to cite the CPI as a measure of inflation, which I do not believe is accurate. How would you describe the key differences between Yellen and Bernanke? Kinda surprised Larry Summers withdrew. Maybe he was too vocal and Yellen was more "safe" |
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I don't despise Occupy Movement. I just think they are disorganized and ignorant. I get that they are hurting but they are directing their energies in the wrong direction. They are loud but they have no clear message.
I know you are trying to do something w ozziecoin. Good luck to you but you are just so misguided. Instead of learning shit from the wackos here why don't you use Cousera.org and take some free classes from legit schools. You can even find classes from Ivy League or elite schools like Stanford. Seriously, check it out cause your knowledge of economics and finance is like high school level.
But I really don't care what you do. Just stop repeating the same thing ad nauseum. Its really boring. Its not like a fresh perspective that nobody has heard before
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The real issue is not that we "allow" fractional reserve lending. The government should not be involved in banking at all.
Banks would not take such stupid risks if they were not back by the federal reserve's ability to print money. If you make stupid decisions you fail. The government bailout addiction makes it easy for banks to make stupid decisions and the hyper regulation after such a bailout leads to the demise of small banks which compounds the original issue by further centralizing the banking system and increasing the risk of systemic shocks. These newly merged frankenbanks are then even more likely to be bailed out for bad decision making. The bailouts come from you and me in the form of tax dollars and devalued currency. Rinse and repeat ad nauseam.
Agree with this. But let's not forget the human propensity to be greedy, especially when they are not personally taking on risk themselves. Banks are run by managers who are paid bonuses. When losses occur, it is the shareholders that get hit. I don't recall any banker going to prison since the GFC. Maybe in Iceland. And if those risks make profits and stockholders make money? Bankers make money in the short term (possible 5 to 10 year period), get paid bonuses. The debt bubble eventually collapses leaving shareholders and taxpayers with the bill. Christ dude, just stop w your "Occupy" cliches. Clearly you don't know how banking or finance or taxes or stocks work. Some banker screw your girlfriend or something? |
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Yes, the modern differentiation between property and management can have serious risks. An exaggerated attention to the short-term (profits this year) and a disregard for the long-term interests of the corporation. So, risks with good short-term profits are welcome.
A system of laissez-faire on the banking system was precisely what left us where we are.
I agree that there should be more regulation but the debate is how much? Is Dodd Frank enough to prevent another 2008? We won't know til it happens again |
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The real issue is not that we "allow" fractional reserve lending. The government should not be involved in banking at all.
Banks would not take such stupid risks if they were not back by the federal reserve's ability to print money. If you make stupid decisions you fail. The government bailout addiction makes it easy for banks to make stupid decisions and the hyper regulation after such a bailout leads to the demise of small banks which compounds the original issue by further centralizing the banking system and increasing the risk of systemic shocks. These newly merged frankenbanks are then even more likely to be bailed out for bad decision making. The bailouts come from you and me in the form of tax dollars and devalued currency. Rinse and repeat ad nauseam.
Agree with this. But let's not forget the human propensity to be greedy, especially when they are not personally taking on risk themselves. Banks are run by managers who are paid bonuses. When losses occur, it is the shareholders that get hit. I don't recall any banker going to prison since the GFC. Maybe in Iceland. And if those risks make profits and stockholders make money? |
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The real issue is not that we "allow" fractional reserve lending. The government should not be involved in banking at all.
Banks would not take such stupid risks if they were not back by the federal reserve's ability to print money. If you make stupid decisions you fail. The government bailout addiction makes it easy for banks to make stupid decisions and the hyper regulation after such a bailout leads to the demise of small banks which compounds the original issue by further centralizing the banking system and increasing the risk of systemic shocks. These newly merged frankenbanks are then even more likely to be bailed out for bad decision making. The bailouts come from you and me in the form of tax dollars and devalued currency. Rinse and repeat ad nauseam.
You are wrong. Bailout was an emergency loan that's already paid off w interest In the case of AIG the Treasury took equity in terms of AIG stock and made a handsome profit selling in 2012. I don't know about you but I didnt pay any more taxes because of bailouts. I got suckered into an ARM mortgage by Countrywide and when my interest ballooned no bank allowed me refinance because my mortgage was underwater. But I could roll it into an FHA jumbo. So the govt helped me out a lot |
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They already started to taper QE. QE by itself was not enough to stimulate the economy, but what it did was try to relieve liquidity issues via The Fed buying MBS from the banks.
The problem is The Fed can only have tools of monetary policy, they can't force the banks to lend it out. Especially when private sector is paying down balance sheets cause they think a economic downturn is coming.
The thing that hasn't happened yet is a big stimulus action like Roosevelt's New Deal. Perhaps that will come next
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FR isn't only the right to lend out money someone lent to us, in the end it's the right to create money by lending the same amount of money several times.
Technically, isn't fraud, but it's risky and concedes a public function (a sovereign one) to a corporation, the right to create money, crowding out as unnecessary the same amount of public money. If the bank can lend the same money, it doesn't have to ask for credit from the central bank. We all lose.
The risk is credit worthiness of the borrower. In England there is no cap so banks can create unlimited credit as long as there are credit worthy borrowers. The make the loans THEN they look for the reserves not the other way around. The problem occurs when deregulation allows things like subprime lending The issue isn't whether we should have FRB or not. It's absolutely necessary for modern economies. The issue is how to regulate it in order to avoid systemic risk |
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