[2017-04-05] FED Board President Does not Understand Bitcoin or the Nature ...

[Gembul]

News Bitcoin - FED Board President Does not Understand Bitcoin or the Nature of Trus

A recent editorial published by Bloomberg on April 4 had quotes from the Philadelphia Federal Reserve’s Patrick Harker concerning digital currencies. In the article, he demonstrates his ignorance about bitcoin’s volatility, the future of banks, and the concept of trust.

The article’s author quotes Harker, saying that digital currencies will not replace banks. Harker said, “Digital currency won’t topple traditional, government-sanctioned money from its central role in the economy in the foreseeable future.”

READ MORE >>> https://news.bitcoin.com/fed-president-not-understand-bitcoin-concept-trust/

[Qartada]

The article doesn't have a lot of real points.  It bases a "conclusion" on its own preconceptions and not on evidence that it has presented in the article - rather, it talks about "accepting" that things are unstable, which implies an immaturity and a lack of understanding of how necessary it is for a major currency to be stable.

However, I would agree that Bitcoin's scarcity will result in deflation due to increasing trust from investors, and that this will result in a decrease of volatility (although the article phrases this very poorly).

[Carlton Banks]

it talks about "accepting" that things are unstable, which implies an immaturity and a lack of understanding of how necessary it is for a major currency to be stable.

And remember also that Central Banks achieve stable currency values in the same way that they promote price stability for general goods: limited access to centralised markets.


Who trades on the currency and commodity markets that set the price of basically everything regular folks buy? Huge merchant banks, like Goldman Sachs and JP Morgan. What stops them colluding with each other to fix the price of commodities and currencies, so that they can take maximum advantage of the markets they control? Not state regulation, that's for sure. The state can't even get these parasites to pay any tax, these motherfuckers actually get net tax rebates instead of paying tax. Not to mention, when they're about to go out of business, who lends the money to JP Morgan to stem the "credit liquidity" crisis, like in 2008? The Central Banks, via state approval.

Can anyone explain to me how that's not basically a fascist system, or a totalitarian, or a communist system? Whatever one wishes to call it, these scumbags control the price of everything in essence, not just the supply and demand (and ergo the price stability) of currencies.

[cr1776]

It is always odd when authors write it as "FED" since it is not an acronym.  It is just terrible journalism and takes away from the point they are attempting to make.

If they wish to talk about price stability, the Fed has done a terrible job of it over the decades, so their so-called expertise is severely lacking.

[renfangfua]

“Volatility may just an inherent feature of money in a digitized, free market environment.”

Volatility also derives from FIAT it self. When Venezuela Peso inflated beyond control, you cant say bitcoin is the volatile value. When you have pockets of inflation, corruption, un-banked, etc. like Venezuela, bitcoin demand will rise, thus affecting its value around the world. Again its not bitcoin that causes volatility when certain pockets have instability.

[kangageaf]

It depends on what you want Bitcoin to do. If it's an investment or a mechanism for occasional large transfers, stability isn't important. But it's hard to do day to day transactions with an unstable currency.

[LittleBitFunny]

It depends on what you want Bitcoin to do. If it's an investment or a mechanism for occasional large transfers, stability isn't important. But it's hard to do day to day transactions with an unstable currency.

You have this the wrong way around.  If it's an investment, maybe it's fine for it to be unstable provided that the price rises in the long term, but when dealing with large transactions occasionally it's very important because it's essentially gambling - people doing these transactions still have to do them, but doing them with Bitcoin would be a lottery hoping that the price was high, otherwise they'd be screwed over.

When doing day to day transactions it's not important, but small transactions are now pretty hard with Bitcoin due to fees, which means that stability is important for large transfers.