2013-04-04 Bloomberg 'Sorry, Libertarians, History Shows Bitcoin Isn't Future'

[Manticore]

2013-04-04 Bloomberg 'Sorry, Libertarians, History Shows Bitcoin Isn't Future'
http://www.bloomberg.com/news/2013-04-04/sorry-libertarians-history-shows-bitcoin-isn-t-the-future.html

[DeathAndTaxes]

Basically the author (article not OP) is making the whole "people will hoard it forever" fallacy.  Yup early adopters sitting on billions of USD worth of Bitcoin will never exchange them for goods, services, (or even convert them to fiat currency) and thus starve to death.  For those not wanting to read the whole thing here is the punch line

Here’s where a state could easily step in by just … printing more money, so that economic activity is not choked off by scarcity or hoarding. This would be totally consistent with the C View, where money is created by states to facilitate economic activity. But since Bitcoins can only be produced at a predetermined rate, deflation is a constant possibility, or that Bitcoins turn more into a commodity people buy than a currency people use.

In the authors view because the state can't artificially inflate the money supply (at the expense of money holders) Bitcoin won't become a currency.  Now the scary part isn't "inflate" it is "state".  Someone not liking Bitcoin because it can't be inflated can still be reasoned with.  Someone not liking Bitcoin because the STATE can't inflate Bitcoin is beyond hope.  In the authors mind it is inconceivable that a crypto currency could be designed to inflate "as needed".  That if one believes the money supply must expand when money is in short supply that the ONLY possible solution is for the state (i.e. federal reserve, central bankers, QE, etc).  Yup technology can't provide a solution, only the state can, the all powerful, all knowing state to ride to the rescue (and drop cash by helicopters).

The author reminds me of another quote:

You have to understand, most of these people are not ready to be unplugged. And many of them are so inured, so hopelessly dependent on the system, that they will fight to protect it.

[Anon136]

2013-04-04 Bloomberg 'Sorry, Libertarians, History Shows Bitcoin Isn't Future'
http://www.bloomberg.com/news/2013-04-04/sorry-libertarians-history-shows-bitcoin-isn-t-the-future.html

First they ignore you, *then they mock you*, then they fight you, then you win.

It would appear that april 2013 is officially the transition point between stage two and stage three.

[jwzguy]

LOL, I remember the last story that started with "Sorry."

Ignorance and self-righteousness, what a combo.

[wachtwoord]

2013-04-04 Bloomberg 'Sorry, Libertarians, History Shows Bitcoin Isn't Future'
http://www.bloomberg.com/news/2013-04-04/sorry-libertarians-history-shows-bitcoin-isn-t-the-future.html

First they ignore you, then they fight you, then you win.

It would appear that april 2013 is officially the transition point between stage one and stage two.

You forgot the mocking stage

[Anon136]

2013-04-04 Bloomberg 'Sorry, Libertarians, History Shows Bitcoin Isn't Future'
http://www.bloomberg.com/news/2013-04-04/sorry-libertarians-history-shows-bitcoin-isn-t-the-future.html

First they ignore you, then they fight you, then you win.

It would appear that april 2013 is officially the transition point between stage one and stage two.

You forgot the mocking stage

fixed

[Luno]

"Charles Goodhart, a former member of the Bank of England’s Monetary Policy Committee"

You know, Bitcoin was invented specificly to piss this guy off.

[bitcoiner32]

I hope we continue to get a flood of these flawed, mocking "economic" articles against bitcoin. Then 5 years from now when it's still growing and growing we'll have people abandoning the status quo in droves.

[TraderTimm]

The author reminds me of another quote:

You have to understand, most of these people are not ready to be unplugged. And many of them are so inured, so hopelessly dependent on the system, that they will fight to protect it.

Spot on, DeathAndTaxes. I think this every time I see someone holding up their sovereign currency as a symbol of what is 'right'. Bitcoin is going to cannibalize their entire system, and they have no way to stop it.

[Grouver (BtcBalance)]

I reminds me about the well written article about Bitcoin on bloomberg that was posted not a long time ago.
http://www.bloomberg.com/news/2013-03-22/bitcoin-virtual-currency-enters-real-world.html

So if bloomberg is controlled by some entity which wants to ridicule Bitcoin... why did it post something really positive about Bitcoin then?
I just can't figure this..... anyone?

[Piper67]

I reminds me about the well written article about Bitcoin on bloomberg that was posted not a long time ago.
http://www.bloomberg.com/news/2013-03-22/bitcoin-virtual-currency-enters-real-world.html

So if bloomberg is controlled by some entity... why did it post something really positive about Bitcoin then?
I just can't figure this..... anyone?

Because some times large corporations have trouble communicating a fart between adjacent stalls in the bathroom.

[Gabi]

Yeah they are right, do you remember that p2p cryptocurrency that failed in middle age?  History is full of p2p cryptocurrencies that failed... 

[DataPlumber]

But since Bitcoins can only be produced at a predetermined rate, deflation is a constant possibility, or that Bitcoins turn more into a commodity people buy than a currency people use.

Because Bitcoin is unlikely to completely replace fiat, there's no room for it in the future..?

What a strawman.  (If I'm unfairly characterizing his argument with my own strawman, let me know, but to the best of my ability to parse language, this seems to be his point and conclusion.)

Incidentally, if you missed the embedded link about drug dealers using Tide as a sort of currency, do check it out.

[Mike Christ]

When you're sitting on the top, you don't want anyone to knock out the bottom; then everyone else comes crumbling down.

Therefor, you attack those who leave from the bottom.  The vast majority of fiat is held by those at the top of the pyramid, and yet those on the bottom of the pyramid are in the billions.  The rich cannot be rich without another group to be poor.  When people realize that anyone who is rich will attack anything which will remove that facade, the pyramid will show a collapse.  The world would even out a bit, and the vast line between the rich and the poor will bring both groups rather close; the line between rich and poor would be awful gray, instead of black and white as it is today.

And maybe then we can all move on with our lives.

[BTC Books]

I reminds me about the well written article about Bitcoin on bloomberg that was posted not a long time ago.
http://www.bloomberg.com/news/2013-03-22/bitcoin-virtual-currency-enters-real-world.html

So if bloomberg is controlled by some entity which wants to ridicule Bitcoin... why did it post something really positive about Bitcoin then?
I just can't figure this..... anyone?

Perhaps the Mayor of NYC, who will not be running for office again, is taking a personal interest.

Are there any statements by Bloomberg on the record, about bitcoin?

[Zomdifros]

I reminds me about the well written article about Bitcoin on bloomberg that was posted not a long time ago.
http://www.bloomberg.com/news/2013-03-22/bitcoin-virtual-currency-enters-real-world.html

So if bloomberg is controlled by some entity which wants to ridicule Bitcoin... why did it post something really positive about Bitcoin then?
I just can't figure this..... anyone?

It doesn't depend so much on the corporation as on whether or not the writer gets it.

[Dusty]

Someone not liking Bitcoin because it can't be inflated can still be reasoned with.  Someone not liking Bitcoin because the STATE can't inflate Bitcoin is beyond hope.

I LOLled hard

[n8rwJeTt8TrrLKPa55eU]

So many fallacies, so little time.  I'll just indulge myself on this one:

Also, a private mint will always have the incentive to say its coins contain more high-value stuff than they actually do.

As opposed to governments in the fiat era, who don't even bother to hide monetary debasement and instead just cloak it using fancy terms such as Quantitative Easing.

[ShireSilver]

So many fallacies, so little time.  I'll just indulge myself on this one:

Also, a private mint will always have the incentive to say its coins contain more high-value stuff than they actually do.

As opposed to governments in the fiat era, who don't even bother to hide monetary debasement and instead just cloak it using fancy terms such as Quantitative Easing.

Yep. I run a private mint, and I make sure to put more in my products than they say they are because I want to make sure my customers are satisfied. You never know who is going to try to verify the accuracy of your claims and if they know how to calibrate their equipment, so putting a little more in there just makes good sense from a business standpoint.

[nimda]

Bitcoin's hyperdeflation is temporary.  The value eventually will top out—or, Heaven forbid, crash—and the deflation should settle into the range of the growth rate of the Bitcoin economy.  When it does, we finally can get down to the real business of doing real business.

Exactly. Bitcoin's M1 needs to grow to a suitable size. Right now, rather than a deflationary spiral, we're just seeing new money enter the market.