2013-04-04 The Economist - Buttonwood - The gold bears emerge

[dr_nix]

http://www.economist.com/blogs/buttonwood/2013/04/investing

It mainly talks about how the gold market turned bearish, but there are two paragraphs about Bitcoin.
It mentions the recent article on FT Alphaville and the blog post of Felix Salmon, and compares Bitcoin to the South Sea bubble:

Indeed, gold's fall contrasts with a sudden boom in the price of another alternative currency, Bitcoin (although the price has been hit today by attacks on the website). As Felix Salmon notes in an excellent post on the virtual money, enthusiasts for Bitcoin and gold come from separate social niches so this trend divergence is explicable, even though one might think their fundamental similarities (a restricted supply) might prompt them to be correlated in normal circumstances. Another explanation for the gap is that the Bitcoin bubble, like any other, is a case of investors piling into an illiquid asset that has suddenly made the news (the story was on the front of the FT today).

In a sense, Bitcoin, a currency with no backing at all except faith (see FT Alphaville), is reminiscent of the "undertaking of great advantage but no one to know what it is" that (perhaps apocryphally) marked the peak of the South Sea Bubble. Of course, many might remark that developed world currencies have no metallic backing and so exist on faith as well; however they do have legal tender status and have the (admittedly impaired) implied backing of the tax-raising powers of their governments. Western governments may yet undermine their currencies but they haven't so far; dollars and euros are pretty universally accepted.

[xcsler]

For my birthday last year my friend got me a subscription to the Economist.
For his birthday last year I sent him 4.5 bitcoins.
True story.

[n8rwJeTt8TrrLKPa55eU]

Wired Magazine has been dethroned.  Economist, FT, and Felix Salmon are the new "axis of evil".  Or, perhaps, "axis of stupid".

[marcus_of_augustus]

Wired Magazine has been dethroned.  Economist, FT, and Felix Salmon are the new "axis of evil".  Or, perhaps, "axis of stupid".

I think it is great to see these highly-respected and "august" institutions finally engage in the debate ..... why? Because we can finally see how weak-minded, ill-informed, irrational and uneducated are the writers and editors who pretend to be "economists" of these financial rags

Something I've suspected for a long while but great to see them hang themselves in print ... as the old saying goes, "give them enough rope .... "

No need to wonder any longer why the global banking system, finances and economies are in such a shitty state, their thinking and ideas are wrong and rotten to the core. It is merely systemic dysfunction bearing its fruit.