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Author Topic: Rand Paul Thinks Bitcoin Should Be Backed By Stocks  (Read 2962 times)
pdawg
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May 01, 2014, 10:47:06 PM
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Full article here:

http://newsbtc.com/2014/05/01/rand-paul-thinks-bitcoin-backed-stocks/

"And actually my theory, if I were setting it up, I’d make it exchangeable for stock. And then it’d have real value. And I’d have it pegged, and I’d have a basket of 10 big retailers. Because I read [Marc] Andreessen’s article a couple months ago. What fascinated me about it was those 2 to 3% margins. If you multiply that out for all of Wal-Mart and they don’t have to use Visa anymore, I’m guessing the people who have to be worried here are Visa and MasterCard. I think it would work, but I think, because I’m sort of a believer in currency having value, if you’re going to create a currency, have it backed up by — you know, Hayek used to talk about a basket of commodities? You could have a basket of stocks, and have some exchangeability, because it’s hard for people like me who are a bit tangible. But you could have an average of stocks, I’m wondering if that’s the next permutation."

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May 01, 2014, 10:49:41 PM
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Do I even need to say it: he obviously doesn't quite "get" Bitcoin.

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May 01, 2014, 10:53:48 PM
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Do I even need to say it: he obviously doesn't quite "get" Bitcoin.

+1
Bitcoin and other cryptos are already backed by many things:
- Millions of dollars of electricity and equipment
- Its users, merchants and community
- A great technology that can't be exploited

Hopefully one day it will be well understood that digital is not equal to virtual; numbers actually are tangible in the information-age.

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May 01, 2014, 10:56:09 PM
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Yeah he needs a quick primer.  I think it's helpful though that they see the potential for commerce to switch to this type of system and get rid of the CC fees.  CC companies should be shaking in their boots.

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May 01, 2014, 11:03:52 PM
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He'll get it after a while I suppose. Rand, if you happen across this consider if the MERS mortgage title company had utilized the block chain to track ownership - for a legislator, that should be enough to get them thinking correctly.

For those who don't know, MERS was the unregulated organization that banks created to 1. forge signatures on mortgage docs 2. trade these documents bypassing local municipalities, in effect, stealing doc fees at the local level 3. double spend! there are cases of mortgages being held / claimed by multiple lenders... and other problems with that corrupt data base (MERS).

MERS scandal that could have been avoided with the bitcoin protocol: http://deadlyclear.wordpress.com/2013/08/20/wall-streets-mortgage-fraud-scandal-you-can-have-a-house-that-is-fully-paid-for-and-still-end-up-in-foreclosure/

"Wall Street’s Mortgage Fraud Scandal. 'You can have a house that is fully paid for and still end up in foreclosure”

Rand, what's the value of bitcoin now?
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Let's talk governance, lipstick, and pigs.


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May 01, 2014, 11:06:06 PM
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Bitcoin, or rather colored bitcoins can be backed by stocks.

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
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May 01, 2014, 11:08:12 PM
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He'll get it after a while I suppose. Rand, if you happen across this consider if the MERS mortgage title company had utilized the block chain to track ownership - for a legislator, that should be enough to get them thinking correctly.

For those who don't know, MERS was the unregulated organization that banks created to 1. forge signatures on mortgage docs 2. trade these documents bypassing local municipalities, in effect, stealing doc fees at the local level 3. double spend! there are cases of mortgages being held / claimed by multiple lenders... and other problems with that corrupt data base (MERS).

MERS scandal that could have been avoided with the bitcoin protocol: http://deadlyclear.wordpress.com/2013/08/20/wall-streets-mortgage-fraud-scandal-you-can-have-a-house-that-is-fully-paid-for-and-still-end-up-in-foreclosure/

"Wall Street’s Mortgage Fraud Scandal. 'You can have a house that is fully paid for and still end up in foreclosure”

Rand, what's the value of bitcoin now?

gaud, that brings back bad memories.

so sad the robosigners they hired to do their dirty work as well.  the banking system is so disgusting and deserves all the scorn we heap upon them everyday.

no wonder i've gone down the rabbit hole with Bitcoin.
pdawg
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May 01, 2014, 11:09:49 PM
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He'll get it after a while I suppose. Rand, if you happen across this consider if the MERS mortgage title company had utilized the block chain to track ownership - for a legislator, that should be enough to get them thinking correctly.

For those who don't know, MERS was the unregulated organization that banks created to 1. forge signatures on mortgage docs 2. trade these documents bypassing local municipalities, in effect, stealing doc fees at the local level 3. double spend! there are cases of mortgages being held / claimed by multiple lenders... and other problems with that corrupt data base (MERS).

MERS scandal that could have been avoided with the bitcoin protocol: http://deadlyclear.wordpress.com/2013/08/20/wall-streets-mortgage-fraud-scandal-you-can-have-a-house-that-is-fully-paid-for-and-still-end-up-in-foreclosure/

"Wall Street’s Mortgage Fraud Scandal. 'You can have a house that is fully paid for and still end up in foreclosure”

Rand, what's the value of bitcoin now?

This is the intriguing part of BTC.  What will be able to plug into the block chain for authentication purposes?  How does that affect future transaction fees as miners make less BTC rewards and want to be compensated for authenticating transactions?  Will future price of BTC offset that?

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May 01, 2014, 11:11:29 PM
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He'll get it after a while I suppose. Rand, if you happen across this consider if the MERS mortgage title company had utilized the block chain to track ownership - for a legislator, that should be enough to get them thinking correctly.

For those who don't know, MERS was the unregulated organization that banks created to 1. forge signatures on mortgage docs 2. trade these documents bypassing local municipalities, in effect, stealing doc fees at the local level 3. double spend! there are cases of mortgages being held / claimed by multiple lenders... and other problems with that corrupt data base (MERS).

MERS scandal that could have been avoided with the bitcoin protocol: http://deadlyclear.wordpress.com/2013/08/20/wall-streets-mortgage-fraud-scandal-you-can-have-a-house-that-is-fully-paid-for-and-still-end-up-in-foreclosure/

"Wall Street’s Mortgage Fraud Scandal. 'You can have a house that is fully paid for and still end up in foreclosure”

Rand, what's the value of bitcoin now?

gaud, that brings back bad memories.

so sad the robosigners they hired to do their dirty work as well.  the banking system is so disgusting and deserves all the scorn we heap upon them everyday.

no wonder i've gone down the rabbit hole with Bitcoin.

Didn't mean to sour your meal, but you've got the cure in the last statement.

If you can stomach it, here's a relevant paragraph from the linked article:

Quote
...As a result of MERS’ actions, coupled with an intricate network of document preparers, it has virtually caused clouds on over 60,000,000+ titles to property in every state in the United States. In doing so, its membership base has saved millions of dollars in recordation fees, by hiding behind MERS’ electronic wall. By doing so, it has deprived the counties of the United States millions upon millions of dollars in badly-needed recordation fees; necessary for not only maintenance of property records (one of the basic tenets of American wealth) but also for the funding of certain county services, which have then had to raise property taxes to accommodate the lack of funds or simply cut back on services it used to be able to pay for on its own...

And people wonder why we don't like banks.
BitDreams
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May 01, 2014, 11:13:17 PM
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This is the intriguing part of BTC.  What will be able to plug into the block chain for authentication purposes?  How does that affect future transaction fees as miners make less BTC rewards and want to be compensated for authenticating transactions?  Will future price of BTC offset that?

Imagine the knock-on benefit to the economy by making the core of everything, instantly auditable and fraud free. Bring on the fees! As a shopper I've always been happy to pay a premium for quality service/goods - which is what bitcoin offers.
cbeast
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Let's talk governance, lipstick, and pigs.


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May 01, 2014, 11:14:08 PM
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This is the intriguing part of BTC.  What will be able to plug into the block chain for authentication purposes?  How does that affect future transaction fees as miners make less BTC rewards and want to be compensated for authenticating transactions?  Will future price of BTC offset that?
I've been advocating for a long time that we declare a minimum transaction based on the cost of electricity and the fee to pay the miners and use that as a base transaction for colored coins. There is only a 40 bit block reserved for metadata in the blockchain itself, but that is supposed to be enough to color a coin to authenticate a share of stock.

Any significantly advanced cryptocurrency is indistinguishable from Ponzi Tulips.
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May 01, 2014, 11:14:39 PM
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He'll get it after a while I suppose. Rand, if you happen across this consider if the MERS mortgage title company had utilized the block chain to track ownership - for a legislator, that should be enough to get them thinking correctly.

For those who don't know, MERS was the unregulated organization that banks created to 1. forge signatures on mortgage docs 2. trade these documents bypassing local municipalities, in effect, stealing doc fees at the local level 3. double spend! there are cases of mortgages being held / claimed by multiple lenders... and other problems with that corrupt data base (MERS).

MERS scandal that could have been avoided with the bitcoin protocol: http://deadlyclear.wordpress.com/2013/08/20/wall-streets-mortgage-fraud-scandal-you-can-have-a-house-that-is-fully-paid-for-and-still-end-up-in-foreclosure/

"Wall Street’s Mortgage Fraud Scandal. 'You can have a house that is fully paid for and still end up in foreclosure”

Rand, what's the value of bitcoin now?

gaud, that brings back bad memories.

so sad the robosigners they hired to do their dirty work as well.  the banking system is so disgusting and deserves all the scorn we heap upon them everyday.

no wonder i've gone down the rabbit hole with Bitcoin.

Didn't mean to sour your meal sour, but you've got the cure in the last statement.

If you can stomach it, here's a relevant paragraph from the linked article:

Quote
...As a result of MERS’ actions, coupled with an intricate network of document preparers, it has virtually caused clouds on over 60,000,000+ titles to property in every state in the United States. In doing so, its membership base has saved millions of dollars in recordation fees, by hiding behind MERS’ electronic wall. By doing so, it has deprived the counties of the United States millions upon millions of dollars in badly-needed recordation fees; necessary for not only maintenance of property records (one of the basic tenets of American wealth) but also for the funding of certain county services, which have then had to raise property taxes to accommodate the lack of funds or simply cut back on services it used to be able to pay for on its own...

not to mention all the interest rate derivatives they sold to municipalities country-wide who then had to pony up millions/billions as they manipulated Libor inexplicably lower thru the Fed.
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May 01, 2014, 11:18:59 PM
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Ron Paul's opinions on bitcoin reflect a broader crisis of misunderstanding that has simultaneously struck the libertarian movement and the Austrian School.

Of the latter, proponents of the Austrian school are not doing themselves any favors by steadfastly refusing to evolve their theories beyond a contemporary quasi-Cult-of-Personality based upon the founders. Antal Fekete, et al, have brilliantly attempted to bring the best aspects of Austrian theories into a modern, functional context (real bills of credit, hedging theories, etc), but his work often falls upon deaf ears because he does not dogmatically accept the gospel of the early Austrians. The modern Austrians, by blindly holding to ossified theories, are becoming as stubbornly entrenched in their beliefs as the Keynesians and Friedmanites.
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May 01, 2014, 11:23:25 PM
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Quote
And actually my theory, if I were setting it up, I’d make it exchangeable for stock.

Luckily bitcoin was not invested by him lol.  Cheesy

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May 01, 2014, 11:25:33 PM
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fiat is backed by a promise and only a promise. which people trust. the only thing is that the promise can and has been broken many times.

bitcoin is based on maths. nothing can break maths.

even thinking of backing bitcoin by stocks is obsurd as stocks can be manipulated by corporations.

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May 01, 2014, 11:26:02 PM
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Ron Paul's opinions on bitcoin reflect a broader crisis of misunderstanding that has simultaneously struck the libertarian movement and the Austrian School.

Of the latter, proponents of the Austrian school are not doing themselves any favors by steadfastly refusing to evolve their theories beyond a contemporary quasi-Cult-of-Personality based upon the founders. Antal Fekete, et al, have brilliantly attempted to bring the best aspects of Austrian theories into a modern, functional context (real bills of credit, hedging theories, etc), but his work often falls upon deaf ears because he does not dogmatically accept the gospel of the early Austrians. The modern Austrians, by blindly holding to ossified theories, are becoming as stubbornly entrenched in their beliefs as the Keynesians and Friedmanites.

I've heard it stated more than once that the bitcoin protocol allows us to test each of these economic theories at an accelerated pace and may the best theories rise to the top! I'm sure in each theory there is plenty of truth and I suspect that there is no one size fits all, in our future bitcoin universe we'll probably examine the problem, requiring one economic theory or another as the best approach and someone will say 'there's a coin for that!'
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May 01, 2014, 11:28:12 PM
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Definitely not getting it.  Bitcoin is backed by the thing that it already is.  Backing requires trust.  Most people dont get that bitcoin doesnt represent anything.  It is the thing.

Its funny the way bitcoin is kind of a litmus test for a certain aptitude.

Rand....
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May 01, 2014, 11:33:52 PM
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Going to send him an email link to this thread.
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May 01, 2014, 11:36:52 PM
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Definitely not getting it.  Bitcoin is backed by the thing that it already is.  Backing requires trust.  Most people dont get that bitcoin doesnt represent anything.  It is the thing.

Its funny the way bitcoin is kind of a litmus test for a certain aptitude.

Rand....


it is amazing isn't it?

having been involved since the beginning of 2011, i would've thought by now, especially after all the ramps in price and interest, that the general population would be able to comprehend basic Bitcoin principles.  nope.  sorry.  the ignorance displayed everyday astounds me.

we really are still in the early adoption stages.
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May 01, 2014, 11:51:16 PM
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even thinking of backing bitcoin by stocks is obsurd as stocks can be manipulated by corporations.

Already a company could created coloured coins that act as a sort of bearer certificate for the company's stocks.  They could probably trade against bitcoins in a trustless way using coinjoin transactions.  It would be a sort of decentralized stock exchange. 

So we already have the ability to do what Rand Paul is suggesting.  In fact, with bitcoin we can create digital tradeable IOUs for any asset we want. 

Yet there is only one asset that is not someone else's liability--bitcoin itself.  I think this is very hard for people to grasp since a "scarce digital commodity" seems like an oxymoron at first.

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