2013-04-14 - NY Times - Antisocial Network - Paul Krugman

[meanig]

Typical central bank loving hatchet job from the man who thinks Ben Bernake knows best.

http://www.nytimes.com/2013/04/15/opinion/krugman-the-antisocial-network.html

What is bitcoin? It’s sometimes described as a way to make transactions online — but that in itself would be nothing new in a world of online credit-card and PayPal transactions. In fact, the Commerce Department estimates that by 2010 about 16 percent of total sales in America already took the form of e-commerce.

The similarity to goldbug rhetoric isn’t a coincidence, since goldbugs and bitcoin enthusiasts — bitbugs? — tend to share both libertarian politics and the belief that governments are vastly abusing their power to print money. At the same time, it’s very peculiar, since bitcoins are in a sense the ultimate fiat currency, with a value conjured out of thin air. Gold’s value comes in part because it has nonmonetary uses, such as filling teeth and making jewelry; paper currencies have value because they’re backed by the power of the state, which defines them as legal tender and accepts them as payment for taxes. Bitcoins, however, derive their value, if any, purely from self-fulfilling prophecy, the belief that other people will accept them as payment.

However, let’s leave that strangeness on one side, along with the peculiar “mining” process — actually a process of complex calculation — used to add to the bitcoin stock. Instead, let’s focus on the two huge misconceptions — one practical, one philosophical — that underlie both goldbugism and bitbugism.

The practical misconception here — and it’s a big one — is the notion that we live in an era of wildly irresponsible money printing, with runaway inflation just around the corner. It’s true that the Federal Reserve and other central banks have greatly expanded their balance sheets — but they’ve done that explicitly as a temporary measure in response to economic crisis. I know, government officials are not to be trusted and all that, but the truth is that Ben Bernanke’s promises that his actions wouldn’t be inflationary have been vindicated year after year, while goldbugs’ dire warnings of inflation keep not coming true.

I was willing to tolerate his bullshit until he made the inflation remark. My food and energy bills are up over 10 percent from this time last year. Also the skulldeggery from the Bank of England is keeping my housing costs sky high 

Krugman is full of shit. How did this cunt get a New York Times column. I want a New York Times column!

[1714047139]

1714047139

[1714047139]

1714047139

[1714047139]

1714047139

[1714047139]

1714047139

[1714047139]

1714047139

[herzmeister]

yes that's quite ridiculous. All statistics clearly show how mass purchasing power dropped dramatically in the last decades.

[zeroday]

paper currencies have value because they’re backed by the power of the state.

He forgot to complete the phrase: paper currencies have value because they’re backed by the power of the state to expropriate citizen's property.

[Wekkel]

History will not be kind....

[Roger_Murdock]

A completely voluntary currency that's not based on coercion and violence and doesn't permit systematic theft? Yep, that's the "anti-social" one.

[proudhon]

The growth of the Internet will slow drastically, as the flaw in "Metcalfe's law"--which states that the number of potential connections in a network is proportional to the square of the number of participants--becomes apparent: most people have nothing to say to each other! By 2005 or so, it will become clear that the Internet's impact on the economy has been no greater than the fax machine's.

As the rate of technological change in computing slows, the number of jobs for IT specialists will decelerate, then actually turn down; ten years from now, the phrase information economy will sound silly.

- Paul Krugman, 1988

I know I can sometimes be bad at predicting things, but wowzee!

[beckspace]

Where I live food cost rose 26%, the government told us that it "only" rose by 9,8%.

Paper currencies are NOT doing fine. Neither governments.

[Gabi]

Krugman is an epic fail

[Wekkel]

Krugman is an epic fail

Apparently, in 1988 already "ten years from now, the phrase information economy will sound silly"

[Gabi]

Ahahahah nice joke 

[flix]

Krugman is getting funnier by the minute...

[herzmeister]

yup



we need one with krugman

[cloudswrest]

Can you believe this guy won a Nobel prize?  Well, given that Obama won one, maybe it's not that surprising.   Only the hard science Nobels, physics, chemistry, medicine, seem to have any credibility left.

[cypherdoc]

none of these guys ever seem to see a problem with 0.01% of the population owning the printing press and giving money to their buddies.

[Minor Miner]

You can tell the DNC has a concentrated effort to discredit bitcoin.   Huffingtonpost had two articles saying how bad bitcoin was and rolled out the NYT krugman for the credibility (nobel prize) factor?

[noedaRDH]

LOL, look at the massive wall of text in the user comments. Seems like 8/10 of them just kisses this pompous article writer's ass. What a joke.

It's all fine though, the more they write about Bitcoin, no matter in what context, the more people will know about them. And out of those people, you'll have a certain amount that actually have minds worthy of researching Bitcoin in more depth. Those are the people we need as participants in this ecosystem, not some sheep who can't tell left from right.

[RodeoX]

Paper and shinny rocks are way better than computer files... Not a very convincing argument.
Funny that I now know more about the future of money than most economic professors.

[StarfishPrime]

Dr. Krugman explaining the merits of gold over bitcoins. So it's come to this. Priceless.

Interestingly, gold is down almost 10% against bitcoin so far today (4/15/13). Bitcoin has been a great hedge against pretty much everything so far this year.

[FreddyFender]

Paper and shinny rocks are way better than computer files... Not a very convincing argument.
Funny that I now know more about the future of money than most economic professors.

Disruptive Technology, enough said!

[marcus_of_augustus]

Kind of sad that Nobel prize winner in economics would not understand (or intentionally abuse ) the dictionary meaning of "fiat" ...

since bitcoins are in a sense the ultimate fiat currency, with a value conjured out of thin air.

Federal Reserve Notes form the most anti-social network of currency the planet has seen since the Roman dineros, so it is plain that Krugman doth protest too loudly ...