Something has to be wasted

[johnyj]

I think I found a match of this two model!

In a deflation economy like bitcoin world, people waste lots of energies to produce the currency (thinking about how much electricity/computation power are wasted in the meaningless hash calculation to generate those coins)

In a inflation economy like the world we are living in, people waste lots of energies to produce the goods and service that no one is interested in(think about those projects never get any return, those business never get any customer, they are purely driven by enthusiasm)

So, something has to be wasted anyway, as long as there is a chanel for exhaust energies,  the economy has some motivation to going forward

[MoonShadow]

Mining for gold is also a net waste of energy, from the perspective that gold has nearly zero industrial uses outside of the monetary functions of gold.  Societies that produce more than they need to persist can afford to commit resources to such endeavors.  Societies that are on the edge of starvation, cannot.

[evoorhees]

MoonShadow - you should switch the order of society's laws in your signature. The 2nd is more important than the 1st.

[MoonShadow]

MoonShadow - you should switch the order of society's laws in your signature. The 2nd is more important than the 1st.

I didn't write them, and they are not ordered based on importance.  The first is the root of all contract law, the second of all criminal & tort law.  They are called 'Mayburys Two Laws'

[Raoul Duke]

gold has nearly zero industrial uses outside of the monetary functions of gold.

That's simply not true... http://geology.com/minerals/gold/uses-of-gold.shtml
In fact it's the complete opposite LOL

[MoonShadow]

gold has nearly zero industrial uses outside of the monetary functions of gold.

That's simply not true... http://geology.com/minerals/gold/uses-of-gold.shtml
In fact it's the complete opposite LOL

Like I said, nearly zero industrial uses.  A few of those mentioned are only potential uses of gold.  For example, Silver is a far better conductor, and is used in aerospace for this purpose.  When is the last time you actually heard of anyone getting a gold filling?  That use has been replaced outright by enameled plastics and porcelin techniques. 

[Jack of Diamonds]

Moon is right, silver is by far the most useful precious metal out there.

The majority of uses for gold on that site mention either backing a currency on it's own, it's malleability, or the fact it can be used for jewelry and ornaments, electricity conduction.

Silver is also a better conductor of electricity (in fact, the best known material in existence), as well as heat.

I would only be interested in gold as an investment, as for it's utility, there aren't really that many compared to other metals. Gold is just something pretty and shiny.

[blogospheroid]

I think I found a match of this two model!

In a deflation economy like bitcoin world, people waste lots of energies to produce the currency (thinking about how much electricity/computation power are wasted in the meaningless hash calculation to generate those coins)

In a inflation economy like the world we are living in, people waste lots of energies to produce the goods and service that no one is interested in(think about those projects never get any return, those business never get any customer, they are purely driven by enthusiasm)

So, something has to be wasted anyway, as long as there is a chanel for exhaust energies,  the economy has some motivation to going forward

All automatic and non-automatic ways of making money will generally balance out. A world where the concept of crypto-currencies which rely on proof-of-work, has caught on will have major research into all sorts of bitcoin like problems - easy to verify, tough to produce. All sorts of research into computation as well, the kind that is going on now into finance.

Whether this is a waste or not is a matter of perspective.

The only thing which can be said is that the way that power plants today are using their waste heat, there will be others who will figure out ways to use waste heat from "mines".

[billyjoeallen]

It's a catch 22. If the thing you use for money has another use, then it's wasted if it's used for money. If it doesn't have another use, then it "wastes" resources to produce and needs to if you don't want overproduction. 

Money increases the efficiency of trade by eliminating the need for a double coincidence of wants. The energy consumed by the mining of bitcoins is more than recouped when the coins are used in trade over and over for years.  Otherwise, you need huge government systems to prevent counterfeiting fiat or huge barter networks to find third fourth and fifth parties willing to trade stuff for the stuff you want to trade.

[deuxmill]

gold has nearly zero industrial uses outside of the monetary functions of gold.

That's simply not true... http://geology.com/minerals/gold/uses-of-gold.shtml
In fact it's the complete opposite LOL

Gold has value because we have faith it has. That's it . Not because of it's uses.

[johnyj]

The Two Laws of All Civilization

1) Do all that you have agreed to do.

2) Do not encroach upon another's person or property.

This shall be the whole of the law.

1st is good, but 2nd, how to define the ownership? First come first get? If every piece of land have already been occupied, then there will unavoidably be some criminal or war?

[Rassah]

The Two Laws of All Civilization

1) Do all that you have agreed to do.

2) Do not encroach upon another's person or property.

This shall be the whole of the law.

1st is good, but 2nd, how to define the ownership? First come first get? If every piece of land have already been occupied, then there will unavoidably be some criminal or war?

I think the 2nd is defined by and supported by the 1st. If you have a contract that you will receive property for your work or money, then the other person has to do what they agreed to do, i.e. honor their contract to give you the property.

[foggyb]

Mining for gold is also a net waste of energy, from the perspective that gold has nearly zero industrial uses outside of the monetary functions of gold.

In third-world countries thousands depend on their gold mining jobs to survive. Add the workers in the mining industries in industrialized countries that would be out of work, and we see that a lot of people's lives would be severely affected if gold mining was stopped.

Bernanke is wrong: gold is the ultimate money. 100% of central banks hold gold, in spite of Bernanke's brush-off. However gold does have weaknesses that bitcoin can thrive on.

I do understand your point, though. From a wider perspective, why do we need gold if we can use anything as a store of value? I think its because of trust. Gold is a substitute for trust in a dog-eat-dog world. The question is, can the networks (and the bitcoin block-chain itself) be trusted enough to include bitcoin on the list of trusted stores of wealth?

[Timo Y]

Free market competition is wasteful by definition because effective competition always requires some duplication of work before the winner emerges and specialization can occur.

It's less wasteful than central planning in most cases, but it's still wasteful.
 

[Melbustus]

In a deflation economy like bitcoin world, people waste lots of energies to produce the currency (thinking about how much electricity/computation power are wasted in the meaningless hash calculation to generate those coins)

Someone correct me if I'm wrong, but the the hash calculation is not meaningless. Generating a block secures the transactions and continually hardens the network. Right now, there's a BTC bounty awarded for that, but that's not the ultimate model. Eventually, the hashing will just be create blocks to secure transactions, which is hardly wasteful. The bounty is just a reasonable means for initial currency distribution, and is, imo, pretty irrelevant overall.

[MoonShadow]

In a deflation economy like bitcoin world, people waste lots of energies to produce the currency (thinking about how much electricity/computation power are wasted in the meaningless hash calculation to generate those coins)

Someone correct me if I'm wrong, but the the hash calculation is not meaningless. Generating a block secures the transactions and continually hardens the network. Right now, there's a BTC bounty awarded for that, but that's not the ultimate model. Eventually, the hashing will just be create blocks to secure transactions, which is hardly wasteful. The bounty is just a reasonable means for initial currency distribution, and is, imo, pretty irrelevant overall.

You are correct.

[foggyb]

It's less wasteful than central planning in most cases, but it's still wasteful.
 

How can it be wasteful if energy can be neither created nor destroyed? 

[Serge]

so is food consumption

[johnyj]

In a deflation economy like bitcoin world, people waste lots of energies to produce the currency (thinking about how much electricity/computation power are wasted in the meaningless hash calculation to generate those coins)

Someone correct me if I'm wrong, but the the hash calculation is not meaningless. Generating a block secures the transactions and continually hardens the network. Right now, there's a BTC bounty awarded for that, but that's not the ultimate model. Eventually, the hashing will just be create blocks to secure transactions, which is hardly wasteful. The bounty is just a reasonable means for initial currency distribution, and is, imo, pretty irrelevant overall.

If you compare with how a bank secure the transactions, much less calculation power is required, they just need to make sure the balance of both account is correct based on the transaction history

[johnyj]

The Two Laws of All Civilization

1) Do all that you have agreed to do.

2) Do not encroach upon another's person or property.

This shall be the whole of the law.

1st is good, but 2nd, how to define the ownership? First come first get? If every piece of land have already been occupied, then there will unavoidably be some criminal or war?

I think the 2nd is defined by and supported by the 1st. If you have a contract that you will receive property for your work or money, then the other person has to do what they agreed to do, i.e. honor their contract to give you the property.

Chicken and egg problem, who first get the ownership?

In bitcoin world, the coin ownership belongs to who first find the block, and due to the rising difficulty, the earlier you find the block, the faster you collect coins. This is still a "first come first get" model