Peter Thiel on Bitcoin

[ctoon6]

The less you debate about Bitcoin the more gets done > more applications > more users > more profit.

That is great advice. It would really be nice if Bitcoin were a 'silent giant'. The best businesses are those no one even knows exist.

One thing to keep in mind with Bitcoin is that it is a sterile asset, even more so than gold in my opinion, and as such and any increase in the value of bitcoins is a result of wealth that was already produced and stored in some other form being transferred to the holder of the bitcoins. Why even let people know their wealth is being siphoned away as Bitcoin grows?

That's not true. For example we need tons of staff and huge secure buildings and trucks to secure dollar transactions. When we switch to Bitcoin we save are wealthier and more value is stored in Bitcoin than previously was stored in dollars. From a more individual perspective we are wealthier when we move our commerce into the Bitcoin realm because we save tx fees.

Bingo. A bitcoin-based economy moves resources more efficiently, meaning less is lost and more is produced. Thus, humanity itself is wealthier, and if one could do a proper accounting of this phenomenon I'd imagine that wealth gain would be quite extensive.  Compare it to letters and email... society gained massive wealth by utilizing email instead of paper letters.

What about the jobs lost moving the money around? What about the companies that loose money because they no longer sell armored trucks? I don't really think you gain as much as you say. There no doubt would be some gain, but most of the "gain" is really just moved from somewhere else. You only need to move money around as fast as product is made. anything faster is just convenience for the most part (there is some marginal benefit, but i am not seeing anything as big as you describe.).

[1713505875]

1713505875

[Rassah]

What about the jobs lost moving the money around? What about the companies that loose money because they no longer sell armored trucks? I don't really think you gain as much as you say. There no doubt would be some gain, but most of the "gain" is really just moved from somewhere else. You only need to move money around as fast as product is made. anything faster is just convenience for the most part (there is some marginal benefit, but i am not seeing anything as big as you describe.).

That labor capital would now be free to do something productive. It's like asking what about the hundreds of farming, or factory assembly jobs that were lost because of tractors and robots? Bitcoin will essentially free up people that used to dig up and fill in holes, and allow them to do something much more productive.

[cbeast]

What about the jobs lost moving the money around? What about the companies that loose money because they no longer sell armored trucks? I don't really think you gain as much as you say. There no doubt would be some gain, but most of the "gain" is really just moved from somewhere else. You only need to move money around as fast as product is made. anything faster is just convenience for the most part (there is some marginal benefit, but i am not seeing anything as big as you describe.).

That labor capital would now be free to do something productive. It's like asking what about the hundreds of farming, or factory assembly jobs that were lost because of tractors and robots? Bitcoin will essentially free up people that used to dig up and fill in holes, and allow them to do something much more productive.

This is true. Where would people find the time for casinos and drug dealers if they were slaving away at jobs? Let's not even talk about the seedier occupations.

[Rassah]

What about the jobs lost moving the money around? What about the companies that loose money because they no longer sell armored trucks? I don't really think you gain as much as you say. There no doubt would be some gain, but most of the "gain" is really just moved from somewhere else. You only need to move money around as fast as product is made. anything faster is just convenience for the most part (there is some marginal benefit, but i am not seeing anything as big as you describe.).

That labor capital would now be free to do something productive. It's like asking what about the hundreds of farming, or factory assembly jobs that were lost because of tractors and robots? Bitcoin will essentially free up people that used to dig up and fill in holes, and allow them to do something much more productive.

This is true. Where would people find the time for casinos and drug dealers if they were slaving away at jobs? Let's not even talk about the seedier occupations.

Doing accounting for growing businesses and entrepreneurs, security for people and places that actually need it, software development for ideas that manage other things besides currency tracking. You make it sound as if bankers are all just blue collar workers who can only either do bank related jobs, or have to resort to desperate seedy jobs. Where are all the farmers, factory workers, and more recently phone support people who's jobs got outsourced, now? Dealing drugs and gambling? Do you honestly believe that when something disruptive comes around and destroys a certain type of job, that everyone who held that job becomes useless and permanently unemployed?

[cbeast]

What about the jobs lost moving the money around? What about the companies that loose money because they no longer sell armored trucks? I don't really think you gain as much as you say. There no doubt would be some gain, but most of the "gain" is really just moved from somewhere else. You only need to move money around as fast as product is made. anything faster is just convenience for the most part (there is some marginal benefit, but i am not seeing anything as big as you describe.).

That labor capital would now be free to do something productive. It's like asking what about the hundreds of farming, or factory assembly jobs that were lost because of tractors and robots? Bitcoin will essentially free up people that used to dig up and fill in holes, and allow them to do something much more productive.

This is true. Where would people find the time for casinos and drug dealers if they were slaving away at jobs? Let's not even talk about the seedier occupations.

Doing accounting for growing businesses and entrepreneurs, security for people and places that actually need it, software development for ideas that manage other things besides currency tracking. You make it sound as if bankers are all just blue collar workers who can only either do bank related jobs, or have to resort to desperate seedy jobs. Where are all the farmers, factory workers, and more recently phone support people who's jobs got outsourced, now? Dealing drugs and gambling? Do you honestly believe that when something disruptive comes around and destroys a certain type of job, that everyone who held that job becomes useless and permanently unemployed?

Run tell dat

[doobadoo]

What about the jobs lost moving the money around? What about the companies that loose money because they no longer sell armored trucks? I don't really think you gain as much as you say. There no doubt would be some gain, but most of the "gain" is really just moved from somewhere else. You only need to move money around as fast as product is made. anything faster is just convenience for the most part (there is some marginal benefit, but i am not seeing anything as big as you describe.).

There's a story Buffet tells about his visit to china where they are showing him this big civil construction project in progress.  Its a bridge or a canal or something.  Anyhow he points out that they could replace 50 or so of the chinese workers digging wtih shovel with one big earth moving truck and 2 operators.  The chinese dignitary looks at him slanted as if Warren were out of touch, and tells him that in China they have a need to create as many jobs as possible.

Warren replies, if this is all about created work for people then why give them shovels?  Give them spoons.

The point is that doing more with fewer workers raises the standard of living.  The automation of the factory has put so many workers out.  Did you know that GM builds about as many cars as the did in the 80s.  But now they do it with half as many workers.  Cars are now more affordable.  hell they even have all kinds of complex things the cars from the 80s didn't, ubiquitous auto trannies, anti lock breaks, air bags, crumple zones etc.  There are many more parts and much more assembly required.  Yet all the car companies do it with about half the labor the needed a few decades ago.

Never cry for 'lost' jobs when a more efficient and better innovation comes along.  We'd still be living in caves. 

Now to beat the dead horse, what about the mechanized tractor/plow/planter?  Put a lot of farm hands out of work.  But they moved to the cities and took up manufacturing jobs.  coinciding wiht a general rise in the living standard.  Now they have gps guided planters that don't even need a driver.  They put more farm hands out of work.   The benefit is cheaper food.   Who can argue with feeding people for less?

[Elwar]

Reminds me of an excerpt from the book "Jonathan Gullible (http://www.jonathangullible.com/translations/UK_Comnt040222.pdf)":

"Jonathan looked up and
saw two men dragging a young woman, kicking and yelling, down
the trail. By the time he caught his breath, the trio had disappeared.
Certain that he couldn’t free the woman alone, Jonathan ran back up
the trail looking for help.
A clearing opened and he saw a group of people gathered around
a big tree – beating it with sticks. Jonathan ran up and grabbed the
arm of a man who was obviously the supervisor. “Please sir, help!”
gasped Jonathan. “Two men have captured a woman and she needs
help!”
“Don’t be alarmed,” the man said gruffly. “She’s under arrest.
Forget her and move along, we’ve got work to do.”
“Arrest?” said Jonathan, still huffing. “She didn’t look like, uh,
like a criminal.” Jonathan wondered, if she was guilty, why did
she cry so desperately for help? “Pardon me, sir, but what was her
crime?”
“Huh?” snorted the man with irritation. “Well, if you must know,
she threatened the jobs of everyone working here.”
“She threatened people’s jobs? How did she do that?” asked
Jonathan.
Glaring down at his ignorant questioner, the supervisor motioned
for Jonathan to come over to a tree where workers busily pounded
away at the trunk. Proudly, he said, “We are tree workers. We knock
down trees for wood by beating them with these sticks. Sometimes
a hundred people, working round-the-clock, can knock down a
good-sized tree in less than a month.” The man pursed his lips and
carefully brushed a speck of dirt from the sleeve of his handsomely
cut coat.
He continued, “That Drawbaugh woman came to work this
morning with a sharp piece of metal attached to the end of her stick.
She cut down a tree in less than an hour – all by herself! Think of
it! Such an outrageous threat to our traditional employment had to
be stopped.”
Jonathan’s eyes widened, aghast to hear that this woman was
punished for her creativity. Back home, everyone used axes and
saws for cutting trees. That’s how he got the wood for his own
boat. “But her invention,” exclaimed Jonathan, “allows people of all
sizes and strengths to cut down trees. Won’t that make it faster and
cheaper to get wood and make things?”
“What do you mean?” the man said angrily. “How could anyone
encourage an idea like that? This noble work can’t be done by any
weakling who comes along with some new idea.”
“But sir,” said Jonathan, trying not to offend, “these good tree
workers have talented hands and brains. They could use the time
saved from knocking down trees to do other things. They could
make tables, cabinets, boats, or even houses!”

[benjamindees]

Who can argue with feeding people for less?

People who understand the concept of resource depletion.

[evoorhees]

What about the jobs lost moving the money around? What about the companies that loose money because they no longer sell armored trucks? I don't really think you gain as much as you say. There no doubt would be some gain, but most of the "gain" is really just moved from somewhere else. You only need to move money around as fast as product is made. anything faster is just convenience for the most part (there is some marginal benefit, but i am not seeing anything as big as you describe.).

There's a story Buffet tells about his visit to china where they are showing him this big civil construction project in progress.  Its a bridge or a canal or something.  Anyhow he points out that they could replace 50 or so of the chinese workers digging wtih shovel with one big earth moving truck and 2 operators.  The chinese dignitary looks at him slanted as if Warren were out of touch, and tells him that in China they have a need to create as many jobs as possible.

Warren replies, if this is all about created work for people then why give them shovels?  Give them spoons.

The point is that doing more with fewer workers raises the standard of living.  The automation of the factory has put so many workers out.  Did you know that GM builds about as many cars as the did in the 80s.  But now they do it with half as many workers.  Cars are now more affordable.  hell they even have all kinds of complex things the cars from the 80s didn't, ubiquitous auto trannies, anti lock breaks, air bags, crumple zones etc.  There are many more parts and much more assembly required.  Yet all the car companies do it with about half the labor the needed a few decades ago.

Never cry for 'lost' jobs when a more efficient and better innovation comes along.  We'd still be living in caves. 

Now to beat the dead horse, what about the mechanized tractor/plow/planter?  Put a lot of farm hands out of work.  But they moved to the cities and took up manufacturing jobs.  coinciding wiht a general rise in the living standard.  Now they have gps guided planters that don't even need a driver.  They put more farm hands out of work.   The benefit is cheaper food.   Who can argue with feeding people for less?

That story is about Milton Friedman, not Warren "I'm a God Damned Socialist" Buffet. Warren would be the one advocating the spoons.

[Trader Steve]

This weekend I was at the International Students for Liberty conference where Peter Thiel gave the opening keynote. I asked him about PayPal's crypto-anarchist roots and the future of Bitcoin and currencies that might follow (in retrospect, I should have specified Bitcoin, because he was a bit vague with his response), and he seemed somewhat fond of the idea, hinted that some sort of cyber-currency future is inevitable, but said that Bitcoin isn't likely to have the network effects necessary to take off, and said that gold-backed currencies already have a great deal of support, and would serve as a better fit for a competing currency. He said that he would have more to say on the topic. Someone I talked to who attended a private social with Thiel mentioned there was an impression that Thiel hadn't done his homework when further questioned on the topic.

I don't have his exact response, but I know the event was taped, and suspect that videos will be uploaded by Students for Liberty after editing.

Edit1: CoinSpeculator shares details of a more in-depth discussion with Thiel
https://bitcointalk.org/index.php?topic=64610.msg760848#msg760848

I have started to hear of this Peter Thiel character over the past year or so, and I have been impressed with his intellect and his focus on issues that our dear to our hearts, here on this forum.

Clearly he has not yet grasped the full impact, if he is still thinking of Bitcoin and Gold as competing things, instead of thinking of Bitcoin as a new technology that will someday be used for transferring gold. The Bitcoin community and the digital gold community are going to merge. The whole will be greater than the sum of its parts. Both commodities have important roles to play in a larger picture of things. Those who still think that it will be "one community or the other" have not yet grasped the full implications of what is happening.

However that is no matter, because soon everyone will come around, and probably Mr. Thiel sooner than most.

As for Bitcoins and gold, it's important to keep in mind that neither has "intrinsic" value.
Rather, both are valued by men for their unique properties.

Gold is:
-- Divisible.
-- Fungible.
-- Value dense.
-- Recognizable.
-- Durable.
-- Zero counter-party risk.
-- Stable in supply, yet minable.
-- Liquid.
-- International.
-- Non-manipulatable. (Non-centralized.)


By comparison:
-- Diamonds, while valuable, are NOT divisible, nor are they fungible.
-- Water, while valuable and divisible, is not value-dense enough to compete with gold as a form of money, on the free market.
-- Food, while valuable, is not durable.
-- Dollars, while liquid, do not represent zero-counter-party-risk (rather, they are debt-based.)
-- Dollars, while recognizable, are not stable in supply (inflation is a worry).
-- Dollars are also not minable. (Production is available only to a monopoly cartel, versus gold, which anyone can produce.)
-- Food, which anyone can produce, is not liquid, especially in comparison to dollars or gold.
-- Dollars, while you can hold them in your pocket, a board of bankers still has the power to reach into your pocket and manipulate its value. (This is not the case with gold.)


Soon it becomes very clear that gold was never "declared" to be a form of money by any "authorities" but rather, became money due to natural market forces.
If gold became money strictly due to natural market forces (as a result of its unique properties) then clearly the only reason it has been supplanted by dollars is due to artificial restraints imposed on the market by government force. (Such as legal tender "laws", tax "laws", money laundering "laws", etc.)
Such forces must be constantly active, otherwise, natural market forces would immediately resolve back to gold again as they have for thousands of years.


Now let's consider Bitcoin's unique properties:
-- Divisible.
-- Fungible.
-- Value dense.
-- Recognizable.
-- Durable.
-- Zero counter-party risk.
-- Stable in supply, yet minable.
-- Liquid.
-- International.
-- Non-manipulatable. (Non-centralized.)
AS WELL AS:
-- Non-confiscatable.
-- Accounts cannot be frozen.
-- Anonymity is possible.
-- Electronically transferrable.


As you can see, Bitcoin's unique properties are similar to those of gold, although it adds new properties due to its ethereal nature.

Those new properties (non-confiscatable, non-freezable, pseudonymous, transferrable electronically) all serve to route-around the artificial forces that are currently being used to supplant gold with the dollar. After all, the various immoral, legal-tender legislation in place today uses the force of a gun to impose fiat money onto an economy that would otherwise resolve to gold by natural forces. That artificial force depends on the government's collusion with banks and their collective monopoly on the ability to issue, store, freeze, confiscate, track, and transfer dollars.

What happens once Bitcoin destroys their ability to do so?

===> What will happen is that Bitcoin will take a pre-eminent role for all digital currency transfers (for ALL currency types including gold.)
===> It will also serve as the censorship-proof "universal medium" for all other online settlements.
===> Gold will eventually revert to its status as money, due to natural market forces that will be unleashed by the technology of Bitcoin, etc. (Just as Bitcoin has enabled people to buy drugs online, meaning Bitcoin has brought natural law to the drug market, so in the same way, Bitcoin will enable people to use gold as money, meaning Bitcoin will also bring natural law to the monetary system.)
===> Of course, gold has already reverted to its status as money at the elite, national, and central-banking levels. But Bitcoin has the potential to enable this for the livestock/slaves at the plebe level as well. (The proletariat.)
===> Ripple will fill the need for credit lines and expansion, in an F2F manner. It will also enable all participants to exchange in-and-out of all other currencies, including fiat currencies, while entirely routing around all existing government-imposed bottlenecks and "money-transmitting authorities". People will easily be able to exchange in-and-out of the system by way of their own trusted friends and attorneys.
===> I believe also that small vault operators, as envisioned by Andrew McMeikan of PKTP, will have an important role to play.
===> As will various transaction servers along the lines of Ricardo, PKTP, Loom, Truledger, and Open-Transactions.
===> As well as various DGC issuers and Bitcoin voting pools.


The next time one of you gets an opportunity to explain Bitcoin to Peter Thiel, please give him more of a "big picture" view of things, and don't let him go astray down the primrose path where people still think of Bitcoin and Gold as "either-or" sort-of-things, when in fact each has unique properties, and its own part to play in a larger, overall vision.

+1

[bitcoinbeliever]

Mr. Thiel sooner than most.

Prescient comment in light of Peter Thiel's investment in BitPay.

http://www.coindesk.com/peter-thiel-founders-fund-lead-2m-funding-round-in-bitpay/

Is the founder of PayPal bigger than any one of his progeny, or is he just finagling for a board seat at the competition?