Peter Schiff doesn't get Bitcoin

[cdnbcguy]

I listen to Peter Schiff on the net and I am disappointed to tell you that he, who is almost always totally clueful, does not get Bitcoin at all.

He talked about it on his broadcast of June 6 2011 and he was all negative -'it's not backed by anything' 'you have to hope someone will accept it' etc. These are all arguments against the US Dollar as well!

What he is missing is that the thing that makes Bitcoin great is that is it constrained. The Govt. cannot reach up it's ass and pull out a trillion Bitcoins and neither can anyone else.

Bitcoin is like a mountain on the internet. It cannot be destroyed unless ALL 100,000 or so users are wiped out. If even ONE survives, its block chain, which is measured by the sum of it's difficulties, will immediately roll over any new competing chain.

This mountain is being added to 50 btc per ten minutes, with the difficulty adjusted every two weeks to keep it so (I think that is a small design flaw, by the way, it should be adjusted continuously.)

Bitcoin is also composed of veteran professional software. What I mean by that is Satoshi used proven code throughout Bitcoin. This code has been inspected, suspected, up and down `spected and is accepted by the community as 'having nothing wrong with it that we can spot'

The only way Bitcoin can fail is if SHA 256 can be hacked, and I bet it can't, or if public key encryption can be hacked and I bet it can't either.

Bitcoins only real problems are it`s deflationary nature and the weird fact that the wallet.dat file is unencrypted on your disk. THAT`S a mistake.

Bitcoin is backed by strong math and good code. The US Dollar is back by bankers promises.

Who do you trust?

[Bazil]

A lot of libertarian types don't like any currency not backed by something that has some utilitarian value

[Grant]

I'll use Peter's own argument against him, his argument against bitcoin 'is not backed by anything'

And the same is true for gold, 'you have to hope someone will accept it'

I understand where he's coming from though, his own fund is heavily invested into gold stocks, of course he will push it above all.

[Anth0n]

For once, I disagree with Peter Schiff. He wants the dollar backed by gold and silver because gold and silver are scarce resources. Bitcoin is also scarce, so I don't see what the problem is.

[imperi]

What's gold backed by? The dollar? 

[MarketNeutral]

Peter Schiff also didn't get the crash of '08.

The guy is smart, but he's talking his book.

[Longmarch]

the weird fact that the wallet.dat file is unencrypted on your disk. THAT`S a mistake.

Off topic, but... Bitcoin is cash.  Seems it should be unencrypted by default, not vice versa.  You always have the option to lock it up yourownself.

[Current-C]

Anyone have a link to this?

[cdnbcguy]

the weird fact that the wallet.dat file is unencrypted on your disk. THAT`S a mistake.

Off topic, but... Bitcoin is cash.  Seems it should be unencrypted by default, not vice versa.  You always have the option to lock it up yourownself.

I guarantee right this second the people who write Trojans are modifing them to grab wallet.dat files, send them somewhere where they will be used to strip accounts automatically.

They HAVE to be encrypted.

[hawks5999]

For once, I disagree with Peter Schiff. He wants the dollar backed by gold and silver because gold and silver are scarce resources. Bitcoin is also scarce, so I don't see what the problem is.

He wants the dollar backed by gold and silver because of his large position in gold and silver.

[evoorhees]

Yes Schiff (and many people) forget that gold is not backed by anything either. It's a commodity, a thing, and it has market value because it's primarily effective as a monetary instrument. The same is true for Bitcoin, except Bitcoin has a few advantages above and beyond gold (it can be sent across the world instantly, a billion $ worth can fit in your pocket, etc). It also has a few disadvantages from gold (could be hacked on your computer perhaps, or a flaw may exist in the coding, etc). The free market will weigh these pros and cons of both monies and decide the appropriate exchange rate between the two.

Bitcoin, like gold, derives its value from its usefulness in trade as a medium of exchange.

[rtcw]

gold doesnt need to be backed by anything cause everyone has known for 6000+ years its valuable, even stupid rappers that make shit music.. it takes capitol,manpower,land and time to produce there for it could never go to zero unless 6 billion people get together and say hey, fuck gold i want bitcoins or paper dollars.   

[hawks5999]

gold doesnt need to be backed by anything cause everyone has known for 6000+ years its valuable, even stupid rappers that make shit music.. it takes capitol,manpower,land and time to produce there for it could never go to zero unless 6 billion people get together and say hey, fuck gold i want bitcoins or paper dollars.   

umm... roughly 5.99 billion have said "hey, fuck gold i want... paper dollars"

[Bitcoin Swami]

Gold has value only because we've been taught it has value.  Native Americans thought white man was crazy cause he lusted over the "yellow rock".  that being said I do have some gold and silver.

[benjamindees]

I've been trying my best to come up with folksy analogies about Bitcoin.  Maybe I should send them to him.

[em3rgentOrdr]

Peter Schiff has a big mouth and an even bigger ego.

[CoinMonster]

Gold doesn't need to "backed". It is the backing.

Gold has utility as money because it has use beyond use as a medium of exchange. It is used in industry, has chemical applications, there's gold in my computer's motherboard, gold nanoparticles kill cancer tumors, gold in some people's teeth, and so forth. It has use as jewelery and decorations. It's pretty to look at. It has its largest use as money, but this rests on its use as other things. It takes time and work to mine it, so the supply is finite.

During his life – several millennia before the birth of Christ – Aristotle laid out the principles of what he considered “good money.”
He said all good money was…

1. Divisible – You could easily divide it into smaller sums, to make change.
2. Durable – It lasts a long time.
3. Convenient – You can easily carry it around with you.
4.Consistent – It always has the same value.
5. Valuable – It’s useful in and of itself.

Gold meets all of these characteristics pretty well and is therefore a good money.

I think people see bitcoin and think "what is to stop the coders from changing the rules and increasing the number of bitcoins thereby enriching themselves?". That was my first thought and why I wrote off bitcoin at first. If you're not a mathmatics freak and basement dwelling code checker, you'd see it as having potentially many of the same flaws as any fiat, non-commodity-backed, non-commodity redeemable currency. I'm sure that's how Peter Schiff sees it.

For once, I disagree with Peter Schiff. He wants the dollar backed by gold and silver because gold and silver are scarce resources. Bitcoin is also scarce, so I don't see what the problem is.

He wants the dollar backed by gold and silver because of his large position in gold and silver.

He wants the dollar backed by gold (and silver?) because it is best for savers and doesn't allow inflation if handled properly. He has a large position in gold and silver because he knows the dollar will not be backed by gold and silver.

[evoorhees]

Gold has value only because we've been taught it has value.  Native Americans thought white man was crazy cause he lusted over the "yellow rock".  that being said I do have some gold and silver.

That's not quite true. Gold has value because it's useful as money (this is why Bitcoin has value as well). Cactuses and sand are poor money, and thus not valuable for that purpose. Gold is excellent for that purpose. Society didn't arbitrarily select gold to be money, it was borne of the market's need for a useful medium of exchange. The Native American "market" seemingly hadn't come to the same conclusion, and that's fine.

[nemo]

I read somewhere that gold was used as money because for a really long time it was the heaviest metal known. Making it easy to tell the difference between real, fake or cut gold.

[bittersweet]

That's the problem with Bitcoin. Gold is SIMPLE, any idiot can understand how it works. Gold is a rare and pretty metal, people want gold - that's all. The way Bitcoin works, well it's pretty advanced concept. To fully understand it you must be a sort of a hacker/geek person. Peter Schiff is not an idiot, but he ain't a hacker.