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Author Topic: Would Hayek have been a fan of Bitcoin?  (Read 3004 times)
Severian
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September 14, 2012, 06:00:05 AM
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After reading this piece by Hayek, I have to think that he would have been a Bitcoin fan. (Thank you Monetaryfreedom.org for sending the link.)

Quote
...“The interesting fact is that what I have called the monopoly of government of issuing money has not only deprived us of good money but has also deprived us of the only process by which we can find out what would be good money. We do not even quite know what exact qualities we want because in the two thousand years in which we have used coins and other money, we have never been allowed to experiment with it, we have never been given a chance to find out what the best kind of money would be.”

“I think we ought to start fairly soon, and I think we must hope that some of the more enterprising and intelligent financiers will soon begin to experiment with such a thing. The great obstacle is that it involves such great changes in the whole financial structure that, and I am saying this from the experience of many discussions, no senior banker, who understands only the present banking system, can really conceive how such a new system would work, and he would not dare to risk and experiment with it. I think we will have to count on a few younger and more flexible brains to begin and show that such a thing can be done.

http://www.dgcmagazine.com/more-wrestling-with-bitcoin/
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iCEBREAKER
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September 14, 2012, 06:55:03 AM
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I like to think that the Most Honorable Sir Hayek would be a fan of Bitcoin.  But I would never presume to speak for the master. 

Let's let the facts and future history speak for themselves.   Cool


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Monero
"The difference between bad and well-developed digital cash will determine
whether we have a dictatorship or a real democracy." 
David Chaum 1996
"Fungibility provides privacy as a side effect."  Adam Back 2014
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Severian
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September 14, 2012, 06:59:49 AM
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I think Hayek would have been all over bitcoin like a cheap suit. His disciples today do his memory an injury by not backing it.
hazek
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September 14, 2012, 09:33:35 AM
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Who cares?

I mean really, why seek approval of a dead guy? It's not like he was infallible and everything he approved of was smart and good... Yes he did some important and by the looks of it correct thinking on the subject of economics, but I see no reason to cling on to his persona. It's his good ideas that we should be spending time on.

I like to think that the Most Honorable Sir Hayek would be a fan of Bitcoin.  But I would never presume to speak for the master. 

Let's let the facts and future history speak for themselves.   Cool

He is your master? He certainly isn't mine.

My personality type: INTJ - please forgive my weaknesses (Not naturally in tune with others feelings; may be insensitive at times, tend to respond to conflict with logic and reason, tend to believe I'm always right)

If however you enjoyed my post: 15j781DjuJeVsZgYbDVt2NZsGrWKRWFHpp
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September 14, 2012, 10:05:48 AM
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"Today I believe that deflation has no recognizable function whatever, and that there is no justification for supporting or permitting a process of deflation."

http://www.themoneyillusion.com/?p=5966

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September 15, 2012, 12:18:48 AM
 #6

Who cares?

I mean really, why seek approval of a dead guy? It's not like he was infallible and everything he approved of was smart and good... Yes he did some important and by the looks of it correct thinking on the subject of economics, but I see no reason to cling on to his persona. It's his good ideas that we should be spending time on.

I like to think that the Most Honorable Sir Hayek would be a fan of Bitcoin.  But I would never presume to speak for the master. 

Let's let the facts and future history speak for themselves.   Cool

He is your master? He certainly isn't mine.

Hayek's body of work represents his mastery of economics.  Why would you take what I said in such a silly, personal way?

Quote
"by the looks of it correct"

Hayeks' massive intellectual influence speaks for itself. 

We don't need your half-assed pedestrian appraisal of his theories, much less your snotty critique of our great respect for the person who elucidated them.

Nobody said he is "infallible."  Take your strawman argument and shove it.  Then grow up, son.   Kiss


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Monero
"The difference between bad and well-developed digital cash will determine
whether we have a dictatorship or a real democracy." 
David Chaum 1996
"Fungibility provides privacy as a side effect."  Adam Back 2014
Buy and sell XMR near you
P2P Exchange Network
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marcus_of_augustus
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September 15, 2012, 12:28:07 AM
 #7

it would be useful to link to the relevant article of Hayek's that DGC refers to

https://mises.org/daily/3204

I like these bits about what Hayek says that applies to bitcoin (and any non-state monetary experiments) ... he may be old and dead but he is still well ahead of anything in establishment and lots of those in the modern "Austrian" school who cling to the gold standard like a shibboleth, disregarding the glaring dichotomoy of advocating for a state-monopoly at the core of their purported free-market, limited state ethos.

Quote
The interesting fact is that what I have called the monopoly of government of issuing money has not only deprived us of good money but has also deprived us of the only process by which we can find out what would be good money. We do not even quite know what exact qualities we want because in the two thousand years in which we have used coins and other money, we have never been allowed to experiment with it, we have never been given a chance to find out what the best kind of money would be.

Quote
The essential point which I can not emphasize strongly enough is that we would get for the first time a money where the whole business of issuing money could be effected only by the issuer issuing good money. He would know that he would at once lose his extremely profitable business if it became known that his money was threatening to depreciate. He would lose it to a competitor who offered better money.

Quote
I wish I could say that what I propose is a plan for the distant future, that we can wait. There was one very intelligent reviewer of my first booklet who said, "Well, three hundred years ago nobody would have believed that government would ever give up its control over religion, so perhaps in three hundred years we can see that government will be prepared to give up its control over money." We have not got that much time. We are now facing the likelihood of the most unpleasant political development, largely as a result of an economic policy with which we have already gone very far.


bullioner
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September 15, 2012, 12:43:13 AM
 #8

Interesting to see this thread, as I just started reading the Denationalization of Money book today.  The following made me think he'd be sceptical about bitcoin as a concept until he saw it actually working (which it now is):

Quote
It is probably impossible for pieces of paper or other tokens
of a material itself of no significant market value to come to be
gradually accepted and held as money unless they represent a
claim on some valuable object.
Portnoy
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September 15, 2012, 01:04:40 AM
 #9

Interesting to see this thread, as I just started reading the Denationalization of Money book today.  The following made me think he'd be sceptical about bitcoin as a concept until he saw it actually working (which it now is):

Quote
It is probably impossible for pieces of paper or other tokens
of a material itself of no significant market value to come to be
gradually accepted and held as money unless they represent a
claim on some valuable object.

It seems to me Bitcoin has significant value as a way of safely, quickly, and inexpensively, sending money globally between people, without interference from governments or other parasitic agencies.
bullioner
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September 15, 2012, 01:45:00 AM
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Interesting to see this thread, as I just started reading the Denationalization of Money book today.  The following made me think he'd be sceptical about bitcoin as a concept until he saw it actually working (which it now is):

Quote
It is probably impossible for pieces of paper or other tokens
of a material itself of no significant market value to come to be
gradually accepted and held as money unless they represent a
claim on some valuable object.

It seems to me Bitcoin has significant value as a way of safely, quickly, and inexpensively, sending money globally between people, without interference from governments or other parasitic agencies.

Indeed.  These money-like properties are enough in themselves to establish value, without the material of which they're composed having a significant market value.  I'm not sure who you think you're arguing with, as it should have been clear from my original post that Hayek has been shown wrong on this point.  Although, given the word "probably", I assumed that his initial scepticism would have given way once he'd seen the system successfully in action.
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September 15, 2012, 01:48:00 AM
 #11

Fuck yeah he would have!

oh, and for the Hayek fans

http://www.youtube.com/watch?v=d0nERTFo-Sk

http://www.youtube.com/watch?v=GTQnarzmTOc

This is not some pseudoeconomic post-modern Libertarian cult, it's an un-led, crowd-sourced mega startup organized around mutual self-interest where problems, whether of the theoretical or purely practical variety, are treated as temporary and, ultimately, solvable.
Censorship of e-gold was easy. Censorship of Bitcoin will be… entertaining.
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September 15, 2012, 01:49:28 AM
 #12

Interesting to see this thread, as I just started reading the Denationalization of Money book today.  The following made me think he'd be sceptical about bitcoin as a concept until he saw it actually working (which it now is):

Quote
It is probably impossible for pieces of paper or other tokens
of a material itself of no significant market value to come to be
gradually accepted and held as money unless they represent a
claim on some valuable object.

It seems to me Bitcoin has significant value as a way of safely, quickly, and inexpensively, sending money globally between people, without interference from governments or other parasitic agencies.

Yes. this has been over-looked, that money can have a value to the market just for being useful at being good money. In some ways these properties provide a floor that can be placed on bitcoin's value, albiet one that is subject to political actions. The other floor is the cost of production by mining, if bitcoins get cheaper in the market than it is to mine them then some miners will buy at the market rather than mine, supporting them at that price, (I have knowingly disregarded secondary effects to difficulty in this argument).

One of the thing's Hayek witres about is how any new issues of free market 'token' money would need to be guaranteed with a floor by the issuing agency. The floor is what gives the market confidence that they will not go to zero. As the market adopts and uses the tokens more then they can achieve any value, a premium, above that floor. In this sense, all token money is a market in a permanent bubble state since it is only the collective confidence of the market that maintains the confidence premium value above the floor.

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September 15, 2012, 02:03:12 AM
 #13

I'm not sure who you think you're arguing with...

Why assume I am arguing?   Wink
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