The economic model behind Bitcoin is flawed

[bitsmichel]

You say that fiat shines where bitcoin doesn't and then go on about how the injection of new coins is the problem. You're a silly little troll you know that?

I don't quite understand what you refer to. Please explain yourself

Isnt Ripple a coin with infinite supply?

[deisik]

You say that fiat shines where bitcoin doesn't and then go on about how the injection of new coins is the problem. You're a silly little troll you know that?

I don't quite understand what you refer to. Please explain yourself

Isnt Ripple a coin with infinite supply?

It is irrelevant, since no cryprocurrency as of now is actually used as money. It is like counting your chicks before they are banged, wtf

[deisik]

The "grand experiment" of dimensionless token sheistery is an anathema to societal wealth.  Infrastructure is decayed.  Resources are depleted.  Educational systems have become frayed and broken.  Corruption and fraud are at the core of everything it touches.  How can one pursue happiness if one is beholden to the counterfeiters to no limit?  The amazing thing is how well people have done despite its perniciousness    

Don't shoot the messenger

[funkenstein]

Thereby you agree that using machinery, or, in a broader sense, technological innovations make people richer and wealthier overall (since they get more output with less or the same amount of effort), right?

Not necessarily. It depends how they are used.  If it is truly more output in a long term sense, then yes.  But one must keep in mind the story of the Lorax.  In the end everyone was poorer overall.  Not because of the technology but because of the idiocy. 

But using (as well as developing and building) more and more sophisticated machinery requires yet more specialization, i.e. what is otherwise called division of labor. Given that, the growing division of labor necessarily requires more skilled hands in greater numbers, i.e., on one hand, it requires the growth of population, and, on the other hand, provides means for this growth through a qualitative increase in productivity, right?

So what about the importance of the population growth now?

This is a good point about population feeding back into ability to specialize.  I'll be sure to bring it up with the Malthusians and various other "blame all problems on too many people" proponents, thanks   And my apologies: carrying capacity and population growth is indeed a worthy topic that should be given some airtime whenever it comes up, no matter how off topic it might seem. 

[deisik]

Thereby you agree that using machinery, or, in a broader sense, technological innovations make people richer and wealthier overall (since they get more output with less or the same amount of effort), right?

Not necessarily. It depends how they are used.  If it is truly more output in a long term sense, then yes.  But one must keep in mind the story of the Lorax.  In the end everyone was poorer overall.  Not because of the technology but because of the idiocy. 

But using (as well as developing and building) more and more sophisticated machinery requires yet more specialization, i.e. what is otherwise called division of labor. Given that, the growing division of labor necessarily requires more skilled hands in greater numbers, i.e., on one hand, it requires the growth of population, and, on the other hand, provides means for this growth through a qualitative increase in productivity, right?

So what about the importance of the population growth now?

This is a good point about population feeding back into ability to specialize.  I'll be sure to bring it up with the Malthusians and various other "blame all problems on too many people" proponents, thanks   And my apologies: carrying capacity and population growth is indeed a worthy topic that should be given some airtime whenever it comes up, no matter how off topic it might seem. 

The division of labor is indeed an important factor in increasing the wealth of society. Many have heard about it, and some even seem to understand how it is related to the population growth. But there is another factor which most don't even suspect about that does dramatically change the wealth of society and actually explains for the exponential growth of population as well as aggregate wealth of society:

Clearly the population has hugely increased, meaning that individual's fraction of ownership of the whole shebang has gone down

As I said, this is outright wrong. Why? Because the whole shebang (as you call it) can be and is actually expanded multifold

[funkenstein]

...On top of the list for me would be survivability, that is: health of the ecosystem and preparedness for shock.  Biodiversity.

You mean, like a whole bunch of animals and plants, irrelevant if humans are around? How silly is that, from the human perspective?

??!!??? 
Life is irrelevant to humans how?  Remember we ARE a bunch of animals and plants.

Animals, Mammals, Primates, in particular humans, require and are part of a large web of interconnected life forms.  Have you ever heard of e.g. food?  It's not exactly irrelevant to your economy.     

The "grand experiment" of dimensionless token sheistery is an anathema to societal wealth.  Infrastructure is decayed.

Compared to what? We have more roads, more computers, the internet, etc., etc. Please qualify.

Compared to what would happen if sanity were considered and failures were allowed to fail instead of being propped up with "lets issue tokens to avoid market forces".   

Sure lets look at the construction and use of the roads.  You asked for a qualifier.  That's good.  Because a blanket assertion that "roads are good" would sure look bad especially after what appeared to be claiming that life is irrelevant.  Roads can suck and be way to expensive to maintain, destroy arable land, and make property more worthless.  Or they can be hugely important to commerce and getting people what they need to pursue happiness.  The difference needs to be decided by the people who use them and by the people who pay for them.  Not by:  "Oh roads.  They are good.  Here let's print some tokens and build them in the most inefficient and short lasting way".  Look at the construction and use of the computers and the internet.  Look at railroads.  Yes people are progressing and building things but we they are held back by the heavy weight of continuous theft and malinvestment.   

Resources are depleted.

Which resources, guano? We know how to make nitric fertilizer now. Can't give oil away. What are we talking about here?

Great example.  NPK fertilizers are not solely responsible, but certainly part of the system that has reduced the once great heart of agriculture in north america to near desert status (actually deserts show remarkably higher biodiversity).  Desertification is par for the course around the globe at this time.  Why?  In part because those farmers using fiat are being constantly robbed.  To stay afloat they need to deplete the resources maximally, even then of course they won't stay afloat.  It is impossible to stay afloat if you imagine a fiat currency to in any way represent wealth.  So it's:  chop the trees all down now.  We need to pay for air conditioning of open air decks in las vegas and trillion dollar wars so cut it all down.   

Educational systems have become frayed and broken.

Higher literacy rates across the world, larger % going on to college after primary school. Again, what do you mean?

Forgive me but I've seen no evidence that you are literate here.  Literacy rates are lower than ever.  I estimate them at 2%.  By literacy I don't mean "can read stop signs and twitter", I mean a minimum of 1000 pages printed material per month.  Competence in at least two languages.  Basic shit that any college would have required a century ago.  "Oh a higher percentage are going to college now we are so literate!"  <-- you must be kidding us!  Too funny. 

The great thing is that while it might be entertaining and educational to argue these topics here, it is in no way necessary to convince anyone.  There isn't any policy change or vote required to turn the corner of history and get out of the dark ages.  We already are doing it. 

[funkenstein]

 

Clearly the population has hugely increased, meaning that individual's fraction of ownership of the whole shebang has gone down

As I said, this is outright wrong. Why? Because the whole shebang (as you call it) can be and is actually expanded multifold

OK, well it depends on other factors.  For example if you have a farm with 100 cows that live comfortably on your acreage, you have a certain amount of wealth from your operation.  Now imagine 100 of you live there.  Each one will have access to less of the wealth.  It's not a huge stretch to move this example to the whole planet considering constant solar influx.

Clearly homeless populations are likely to go up with larger populations.  I think you will find that a certain level of poverty is correlated with population density.  But yeah, these examples are too simple and one should consider exactly what might be meant by the whole shebang and multifold growth. 

[funkenstein]

Sorry, here's the question again, edited for clarity:
"You mean, like a whole bunch of animals and plants, irrelevant if humans are [or are not] around?"

I'm saying that biodiversity is relevant, to me, only inasmuch as I [a human] profit from it. Wouldn't like it at all if a new species appeared. while I went instinct.

Aha, OK gotcha thanks I see your point now.  Yeah, they are relevant in that they help us stay alive (survivability), barring that, not so much.  A pile of food in the larder does indeed become irrelevant after the inhabitants capable of eating said food all died off.  Well not to the bacteria in there or the people who come and find it but that's a different story.   

Because the efficiency with which the infrastructure was, or was not, built, is irrelevant to the current state of the infrastructure.

Well my apologies if I misspoke.  Certainly different infrastructures are decaying and growing simultaneously..  for example railroad in north america and bitcoin infrastrucure worldwide.  My point was not to claim any one type or other was increasing or decreasing but that in general the use of counterfeitable currencies in the construction and maintenance of said infrastructure can only be a detriment to its long term survival. 

Please learn to respond to the actual question, which is: 'which resources are depleted?'
Las Vegas is in the middle of a fucking desert, so no trees to cut down. If pictures help, here's an aerial shot of the Life-giving Forest, cut down to make possible air-conditioned open air decks:

Topsoil, hardwood, fish stocks, helium, groundwater reservoirs, glaciers, natural gas to name seven. 

I didn't mean the trees in Vegas were being chopped, haha, sorry.  I meant that the trees in the Amazon are being chopped and traded for fiat..  while others are printing fiat and it gets spent air conditioning Vegas - a process which leads to depreciating the value of the tokens which were given in exchange for the trees.  You see how that goes. 

 

[deisik]

 

Clearly the population has hugely increased, meaning that individual's fraction of ownership of the whole shebang has gone down

As I said, this is outright wrong. Why? Because the whole shebang (as you call it) can be and is actually expanded multifold

OK, well it depends on other factors.  For example if you have a farm with 100 cows that live comfortably on your acreage, you have a certain amount of wealth from your operation.  Now imagine 100 of you live there.  Each one will have access to less of the wealth.  It's not a huge stretch to move this example to the whole planet considering constant solar influx

You don't get it, fundamentally. But you should necessarily agree that if you don't understand this (as you didn't understand why population growth is so much important for the division of labor) then all your ideas and notions about fiat money (dimensionless token sheistery, exchange commodity fraud, and all other derogatory names you used or abstained from using) can be as much misguided or just downright false (reverse thinking, yeah)...

This story is not so much about money as it is about ignorance, wow

[funkenstein]

 

Clearly the population has hugely increased, meaning that individual's fraction of ownership of the whole shebang has gone down

As I said, this is outright wrong. Why? Because the whole shebang (as you call it) can be and is actually expanded multifold

OK, well it depends on other factors.  For example if you have a farm with 100 cows that live comfortably on your acreage, you have a certain amount of wealth from your operation.  Now imagine 100 of you live there.  Each one will have access to less of the wealth.  It's not a huge stretch to move this example to the whole planet considering constant solar influx

You don't get it, fundamentally. But you should necessarily agree that if don't understand this (as you didn't understand why population growth is so much important for the division of labor) then all your ideas and notions about fiat money (dimensionless token sheistery, exchange commodity fraud, and all other derogatory names you used or abstained from using) can be as much misguided or just downright false (reverse thinking, yeah)...

This story is not so much about money as it is about ignorance, wow

Well hey, why don't you educate me then?   What is missing from the simple example I gave?  I tried to make it very simple.. sure I can think of some things about life that are not exactly imitable by farms of spherical cows.  Which ones do you have in mind?  Or is it something else entirely I am missing?  I'm sure you will agree that in some instances, e.g. cancer, population growth is not the greatest marker of long term health.   

You should necessarily agree that even if you have lost hope in this dwarf in ever leaving ignorance, there might be a forum reader somewhere that could benefit from your current expenditure of energy here.  Otherwise..  why bother?  Lets hear it    

[deisik]

You don't get it, fundamentally. But you should necessarily agree that if don't understand this (as you didn't understand why population growth is so much important for the division of labor) then all your ideas and notions about fiat money (dimensionless token sheistery, exchange commodity fraud, and all other derogatory names you used or abstained from using) can be as much misguided or just downright false (reverse thinking, yeah)...

This story is not so much about money as it is about ignorance, wow

Well hey, why don't you educate me then? What is missing from the simple example I gave?  I tried to make it very simple.. sure I can think of some things about life that are not exactly imitable by farms of spherical cows.  Which ones do you have in mind? Or is it something else entirely I am missing? I'm sure you will agree that in some instances, e.g. cancer, population growth is not the greatest marker of long term health

An expansion of knowledge is missing in your example. It means that a deeper insight into things allows to qualitatively expand the resource base of humanity, not just by more fully utilizing existing resources in regular ways but by including into the pool of available and accessible resources things that previously were either not useful altogether (or even unknown to us at all, as many things still are), or useful only in a small, limited number of ways. For example, electricity existed since the beginning of times, but we could make use of it only a hundred years ago. Oil has been known since the dawn of humanity, but it was only after and due to the break-throughs in chemistry that it has become the resource as valuable and indispensable as we know it today...

Quoting Carl Menger on the subject:

The quantities of consumption goods at human disposal are limited only by the extent of human knowledge of the causal connections between things, and by the extent of human control over these things. Increasing understanding of the causal connections between things and human welfare, and increasing control of the less proximate conditions responsible for human welfare, have led mankind, therefore, from a state of barbarism and the deepest misery to its present stage of civilization and well-being, and have changed vast regions inhabited by a few miserable, excessively poor, men into densely populated civilized countries. Nothing is more certain than that the degree of economic progress of mankind will still, in future epochs, be commensurate with the degree of progress of human knowledge

The explosive expansion of knowledge is the primary engine that has been driving the wealth of society to entirely new levels during the last few centuries

[funkenstein]

An expansion of knowledge is missing in your example. It means that a deeper insight into things allows to qualitatively expand the resource base of humanity, not just by more fully utilizing existing resources in regular ways but by including into the pool of available and accessible resources things that previously were either not useful altogether (or even unknown to us at all, as many things still are), or useful only in a small, limited number of ways. For example, electricity existed since the beginning of times, but we could make use of it only a hundred years ago. Oil has been known since the dawn of humanity, but it was only after and due to the break-throughs in chemistry that it has become the resource as valuable and indispensable as we know it today...

Quoting Carl Menger on the subject:

The quantities of consumption goods at human disposal are limited only by the extent of human knowledge of the causal connections between things, and by the extent of human control over these things. Increasing understanding of the causal connections between things and human welfare, and increasing control of the less proximate conditions responsible for human welfare, have led mankind, therefore, from a state of barbarism and the deepest misery to its present stage of civilization and well-being, and have changed vast regions inhabited by a few miserable, excessively poor, men into densely populated civilized countries. Nothing is more certain than that the degree of economic progress of mankind will still, in future epochs, be commensurate with the degree of progress of human knowledge

The explosive expansion of knowledge is the primary engine that has been driving the wealth of society to entirely new levels during the last few centuries

I like this   Mostly all of it.  The part about assuming barbarism and misery were the way things were is hardly the view of most historians like e.g. Plato or Bible however, and there are those who claim there is still some barbarism and misery out there as well.  But yeah:  bring on the explosion of knowledge!  And since we have allowed ourselves to stray to other issues not necessarily related to the "economic model of bitcoin"..  perhaps we should not leave aside the issue of education, as brought up once in thread.  I know of not a single professor, colleague, or author who does not complain about the declining standards thereof.  A trend we had better be prepared to fight tooth and nail rather than brush aside and claim is nothing due to college attendance. 

[funkenstein]

I meant that the trees in the Amazon are being chopped and traded for fiat.

The trees in the Amazon are being chopped for money. They would be cut for BTC if that was the coin of the realm. People are selfish, greedy and shortsighted is why.

Indeed, right you are.  Wait a minute, weren't you going to argue that perhaps some people should be trusted with the power to create infinite fiat tokens at the expense of all other participants?  I guess not.  Selfish, greedy and shortsighted:  not equipped to deal with counterfeitables.  Too easy to cheat.    

[funkenstein]

Not following what you're trying to say. Do you feel less trees would get cut if BTC was money? How so?

Well not "if BTC was money"..   it is already,  but if the people cutting them used hard currency instead of counterfeitable, so they could save up and not have to keep cutting.

And what makes you think that the 9 people who control 90% of Bitcoin hashpower are any less crooked than all the people controlling central banks around the world?

Nothing at all makes them less crooked.  But they are limited.  Only 21million.  If you hold 1 BTC you have a fixed percentage.  Fiat crooks control infinity percent of fiat.  It's a big difference.  Holding one funbuck means..  nothing at all.    

[funkenstein]

You also don't understand how bitcoin works. Max # of coins, and block reward schedule, could be changed with a few lines of code. It's called a hardfork, what's being considered now to lift the blocksize limit.

What's good for the goose is not always what's good for the gander. What's good for the holder of BTC is not what's good for the miner of BTC.
If the miners agree on changing the blocksize reward, on delaying the halvening, on anything at all -- easily done.
 

OK, have fun on your new inflatochain.  I'll be sticking the the one with the hard cap.  But think of it this way - even if you are on an inflating chain..  like doge or something, fedcoin, whatever, you are still using a public coin.  The money supply is public.  Compare that to the counterfeitables:  infinitely counterfeitable at any moment, representative of nothing.  Money supply always invisible.  IKR?  Srsly, there are still people out there who will trade goods and services for the stuff!!   lol right?

[deisik]

OK, have fun on your new inflatochain.  I'll be sticking the the one with the hard cap.  But think of it this way - even if you are on an inflating chain..  like doge or something, fedcoin, whatever, you are still using a public coin.  The money supply is public.  Compare that to the counterfeitables:  infinitely counterfeitable at any moment, representative of nothing.  Money supply always invisible.  IKR?  Srsly, there are still people out there who will trade goods and services for the stuff!!   lol right?

Are you really that dumb (nonsequitur or no nonsequitur, lol)? After all, the state can just come after you, take all your wealth and even your life (you were financing terrorism, put up armed resistance and police returned fire). Why this is not likely to happen (unless you are really financing terrorism or do some other nasty things)? Since no one is going to come after you just because they can...

Ultimately, it all boils down to the same thing, i.e. mutual dependence between individuals in a society

[funkenstein]

OK, have fun on your new inflatochain.  I'll be sticking the the one with the hard cap.  But think of it this way - even if you are on an inflating chain..  like doge or something, fedcoin, whatever, you are still using a public coin.  The money supply is public.  Compare that to the counterfeitables:  infinitely counterfeitable at any moment, representative of nothing.  Money supply always invisible.  IKR?  Srsly, there are still people out there who will trade goods and services for the stuff!!   lol right?

Are you really that dumb (nonsequitur or no nonsequitur, lol)? After all, the state can just come after you, take all your wealth and even your life (you were financing terrorism, put up armed resistance and police returned fire). Why this is not likely to happen (unless you are really financing terrorism or do some other nasty things)? Since no one is going to come after you just because they can...

Ultimately, it all boils down to the same thing, i.e. mutual dependence between individuals in a society

Hmm, well uh,  we don't need to wear "I'm the state" hats to rob folks, but yeah sometimes it helps,  If some individuals have chosen to use noncounterfeitable tokens for mutually dependent organization in their society, and we want to rob them, we will have to do just that - go door to door.  No more creating billion dollar bank accounts by flipping single bits.     

[deisik]

OK, have fun on your new inflatochain.  I'll be sticking the the one with the hard cap.  But think of it this way - even if you are on an inflating chain..  like doge or something, fedcoin, whatever, you are still using a public coin.  The money supply is public.  Compare that to the counterfeitables:  infinitely counterfeitable at any moment, representative of nothing.  Money supply always invisible.  IKR?  Srsly, there are still people out there who will trade goods and services for the stuff!!   lol right?

Are you really that dumb (nonsequitur or no nonsequitur, lol)? After all, the state can just come after you, take all your wealth and even your life (you were financing terrorism, put up armed resistance and police returned fire). Why this is not likely to happen (unless you are really financing terrorism or do some other nasty things)? Since no one is going to come after you just because they can...

Ultimately, it all boils down to the same thing, i.e. mutual dependence between individuals in a society

Hmm, well uh,  we don't need to wear "I'm the state" hats to rob folks, but yeah sometimes it helps,  If some individuals have chosen to use noncounterfeitable tokens for mutually dependent organization in their society, and we want to rob them, we will have to do just that - go door to door.  No more creating billion dollar bank accounts by flipping single bits.     

Unless you somehow manage to get out of the reach of those "We the People" types (who are essentially the same types who print money), your "noncounterfeitable tokens" can become as useless and as easily as the counterfeitable ones (to you personally). In fact, even more easily, for your own insignificance and the insignificance of those "noncounterfeitable tokens"...

So, eventually, this all amounts to how smart you are in general and how well you can outsmart the "bad guys" in particular

[deisik]

And if you think that the "genuine" tokens somehow make you smarter (than the "bad guys" with a big gun out there), while the fake ones... well, less so, then you are in for a rude awakening

[funkenstein]

your "noncounterfeitable tokens" can become as useless and as easily as the counterfeitable ones (to you personally). In fact, even more easily, for your own insignificance and the insignificance of those "noncounterfeitable tokens"...

Well this is a very important point thanks.  When we are staring the Eagle in the face, the unknown, the hostile universe, our exchange commodities aren't gonna help us.  We can't eat public coin just like we can't eat fiat.  Nor will it necessarily appease any man or other beast. 

And if you think that the "genuine" tokens somehow make you smarter (than the "bad guys" with a big gun out there), while the fake ones... well, less so, then you are in for a rude awakening

I'd like to hear more about this.  In general the false dichotomy of "bad guys" and "good guys"  is not always so useful, but if your goal is not being robbed - then using a tool which makes it harder for bad guys to rob you seems like a good idea.  Wouldn't you say?