molecular
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July 21, 2014, 02:18:53 PM |
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This is the second time in a few days that I read this. Could you point to studies on the matter? I like that not even Austrians seem to be aware of this.
It's going to have to be forced down there throats, it shakes Mises's regression theorem at the core. At first I couldn't accept it but the earlier linked video sugar coats it and makes it taste nice. The regression theorem is on shaky feet since bitcoin anyway. Actually the regression theorem has nothing to do with Bitcoin. The regression theorem is about physical object substitutes for ledger systems, a.k.a. media of exchange. Bitcoin is not a medium of exchange; it obviates (makes unnecessary) the need for media of exchange. Media of exchange are a low-tech hack for doing what Bitcoin does. Hence the Austrian economists are technically correct when they say that Bitcoin isn't money and that it doesn't satisfy the regression theorem. It isn't money as they define it - that is, it isn't a medium of exchange. Again, it obviates the need for media of exchange. In Austrian parlance, then, it obviates the need for "money." Money in the Austrian sense is just a stopgag measure to deal with the technical difficulties of maintaining large accounting ledgers. That is a result of their starting definitions, though they may want to revise them now that Bitcoin exists. Bitcoin bypasses the entire Regression Theorem framework. Like someone said, Bitcoin and the Regression Theorem gaze at each other knowingly over a chasm. The one has nothing to say about the other. The Austrians who haven't come around yet because of the Regression Theorem are simply getting tripped up by their definitions, as well as by the way the Bitcoin has been marketed so far with the focus on "coins" rather than on the ledger. Thank your for this viewpoint. I will make it my own. Makes loads of sense. |
PGP key molecular F9B70769 fingerprint 9CDD C0D3 20F8 279F 6BE0 3F39 FC49 2362 F9B7 0769
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I HATE TABLES I HATE TABLES I HA(╯°□°）╯︵ ┻━┻ TABLES I HATE TABLES I HATE TABLES
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BldSwtTrs
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July 21, 2014, 02:53:07 PM
Last edit: July 21, 2014, 03:08:43 PM by BldSwtTrs |
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This is the second time in a few days that I read this. Could you point to studies on the matter? I like that not even Austrians seem to be aware of this.
It's going to have to be forced down there throats, it shakes Mises's regression theorem at the core. At first I couldn't accept it but the earlier linked video sugar coats it and makes it taste nice. The regression theorem is on shaky feet since bitcoin anyway. Actually the regression theorem has nothing to do with Bitcoin. The regression theorem is about physical object substitutes for ledger systems, a.k.a. media of exchange. Bitcoin is not a medium of exchange; it obviates (makes unnecessary) the need for media of exchange. Media of exchange are a low-tech hack for doing what Bitcoin does. Hence the Austrian economists are technically correct when they say that Bitcoin isn't money and that it doesn't satisfy the regression theorem. It isn't money as they define it - that is, it isn't a medium of exchange. Again, it obviates the need for media of exchange. In Austrian parlance, then, it obviates the need for "money." Money in the Austrian sense is just a stopgag measure to deal with the technical difficulties of maintaining large accounting ledgers. That is a result of their starting definitions, though they may want to revise them now that Bitcoin exists. Bitcoin bypasses the entire Regression Theorem framework. Like someone said, Bitcoin and the Regression Theorem gaze at each other knowingly over a chasm. The one has nothing to say about the other. The Austrians who haven't come around yet because of the Regression Theorem are simply getting tripped up by their definitions, as well as by the way the Bitcoin has been marketed so far with the focus on "coins" rather than on the ledger. Thank your for this viewpoint. I will make it my own. Makes loads of sense. Great insight indeed. Zangelbert, I don't know if you have read Cursed money! from F. Bastiat but in case you didn't you may appreciate it (it's a quick read). I think he was the first author to conceptualize accurately what is money. He didn't employ the terms ledger and memory, but he clearly understand the fact that money is a social debt and works as a memory. Which is sad is that Austrians who otherwise love him dismiss his sole essay on money because it doesn't fit their views of money as a commodity. |
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chriswilmer
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July 21, 2014, 03:34:00 PM |
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This is the second time in a few days that I read this. Could you point to studies on the matter? I like that not even Austrians seem to be aware of this.
It's going to have to be forced down there throats, it shakes Mises's regression theorem at the core. At first I couldn't accept it but the earlier linked video sugar coats it and makes it taste nice. The regression theorem is on shaky feet since bitcoin anyway. Actually the regression theorem has nothing to do with Bitcoin. The regression theorem is about physical object substitutes for ledger systems, a.k.a. media of exchange. Bitcoin is not a medium of exchange; it obviates (makes unnecessary) the need for media of exchange. Media of exchange are a low-tech hack for doing what Bitcoin does. Hence the Austrian economists are technically correct when they say that Bitcoin isn't money and that it doesn't satisfy the regression theorem. It isn't money as they define it - that is, it isn't a medium of exchange. Again, it obviates the need for media of exchange. In Austrian parlance, then, it obviates the need for "money." Money in the Austrian sense is just a stopgag measure to deal with the technical difficulties of maintaining large accounting ledgers. That is a result of their starting definitions, though they may want to revise them now that Bitcoin exists. Bitcoin bypasses the entire Regression Theorem framework. Like someone said, Bitcoin and the Regression Theorem gaze at each other knowingly over a chasm. The one has nothing to say about the other. The Austrians who haven't come around yet because of the Regression Theorem are simply getting tripped up by their definitions, as well as by the way the Bitcoin has been marketed so far with the focus on "coins" rather than on the ledger. I'm starting to see now how Bitcoin, in a parallel universe, would have been adopted a lot more quickly if it was called "Bitledger" and just referred to as a ledger from the start. Who knows... but the ledger paradigm really makes it all very clear in my opinion. |
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FNG
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July 21, 2014, 03:35:10 PM |
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Zangelbert Bingledack
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July 21, 2014, 03:50:38 PM |
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Zangelbert, I don't know if you have read Cursed money! from F. Bastiat but in case you didn't you may appreciate it (it's a quick read).
I think he was the first author to conceptualize accurately what is money. He didn't employ the terms ledger and memory, but he clearly understand the fact that money is a social debt and works as a memory.
Which is sad is that Austrians who otherwise love him dismiss his sole essay on money because it doesn't fit their views of money as a commodity.
Thanks for that. It was a great essay and suspiciously absent of mention in the Austrian circles I frequent. This passage seems most relevant: This is the time, then, to analyse the true function of cash, independently of mines and importations. You have a crown. What does it imply in your hands? It is, as it were, the witness and proof that you have, at some time or other, performed some labour, which, instead of profiting by it, you have bestowed upon society in the person of your client. This crown testifies that you have performed a service for society, and, moreover, it shows the value of it. It bears witness, besides, that you have not yet obtained from society a real equivalent service, to which you have a right. To place you in a condition to exercise this right, at the time and in the manner you please, society, by means of your client, has given you an acknowledgment, a title, a privilege from the republic, a counter, a crown in fact, which only differs from executive titles by bearing its value in itself; and if you are able to read with your mind’s eye the inscriptions stamped upon it you will distinctly decipher these words: – “Pay the bearer a service equivalent to what he has rendered to society, the value received being shown, proved, and measured by that which is represented by me.” Now, you give up your crown to me. Either my title to it is gratuitous, or it is a claim. If you give it me as payment for a service, the following is the result: – your account with society for real satisfactions is regulated, balanced, and closed. You had rendered it a service for a crown, you now restore the crown for a service; as far as you are concerned, you are clear. As for me, I am just in the position in which you were just now. It is I who am now in advance to society for the service which I have just rendered it in your person. I am become its creditor for the value of the labour which I have performed for you, and which I might devote to myself. It is into my hands, then, that the title of this credit – the proof of this social debt – ought to pass. You cannot say that I am any richer; if I am entitled to receive, it is because I have given. Still less can you say that society is a crown richer, because one of its members has a crown more, and another has one less. For if you let me have this crown gratis, it is certain that I shall be so much the richer, but you will be so much the poorer for it; and the social fortune, taken in a mass, will have undergone no change, because as I have already said, this fortune consists in real services, in effective satisfactions, in useful things. You were a creditor to society, you made me a substitute to your rights, and it signifies little to society, which owes a service, whether it pays the debt to you or to me. This is discharged as soon as the bearer of the claim is paid. It reminds me of reddit user Capt_Roger_Murdock's excellent succinct explanation of Bitcoin: The reason it's so hard for most people to understand Bitcoin is that most people don't really understand money. Money isn't wealth. It's an accounting system used to facilitate the exchange of wealth. (The paradox of money is that while everyone wants it, no one actually wants it - they want the stuff they can buy with it!) Many people are put off by the fact that bitcoins are "just data." But that's what ALL money is, information! More precisely, money is a means for credibly conveying information about value given but not yet received (or at least not yet received in a form in which it can directly satisfy a person's wants or needs).
To put it yet another way, money is a ledger. With fiat currencies like the dollar, that ledger is centralized. And that gives the central authority responsible for maintaining that ledger tremendous power, power that history has proven will inevitably be abused. With Bitcoin, the ledger is decentralized. And that means that no one individual or entity has the power to arbitrarily create new units (thereby causing inflation), freeze (or seize) your account, or block a particular payment from being processed. We've had decentralized money before. After all, no one can simply print new gold into existence. And the "ledger" of gold is distributed because the physical gold itself (the "accounting entries" in the metaphor) is distributed. But with gold, that decentralization comes at a heavy price (literally). The physical nature of gold makes it hugely inefficient from a transactional perspective.
Enter Bitcoin.
It is the first currency in the world that is BOTH decentralized AND digital. It is more reliably scarce than gold, more transactionally efficient than "modern" digital banking, and enables greater financial privacy than cash. It could certainly still fail for one reason or another, but if it doesn't, it has the potential to be very, VERY disruptive. |
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Zangelbert Bingledack
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July 21, 2014, 04:08:22 PM |
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I'm starting to see now how Bitcoin, in a parallel universe, would have been adopted a lot more quickly if it was called "Bitledger" and just referred to as a ledger from the start. Who knows... but the ledger paradigm really makes it all very clear in my opinion.
I'm guessing it was due to the past attempts at "e-cash" that had already framed the endeavor. Satoshi achieved the goal via a ledger system, but didn't call it "BitLedger" presumably because Bitcoin sounded more enticing given he was up against a bunch of people who couldn't see the point. Much of the early days were spent just convincing people it had any value at all, and admittedly the name BitLedger doesn't exactly scream "money" at a visceral level. However, several years of history with a liquid market demonstrating that the units are at all times very much redeemable for goods, services, and fiat money should have long since dispelled such concerns - assuming they were ever really stopping anyone anyway. In my own case, if I had run across "BitLedger" I would have at least had to think a bit before initially dismissing it. It's a whole new idea. I'm inclined to think I'd reach the obvious conclusion: being essentially a community norm, it's going to be as valuable as the community that adopts it, and it's a chicken-and-egg thing. Which is true. |
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cypherdoc (OP)
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July 21, 2014, 04:10:40 PM |
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cypherdoc (OP)
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July 21, 2014, 04:54:02 PM |
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hdbuck
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July 21, 2014, 05:35:37 PM |
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cypherdoc (OP)
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July 21, 2014, 06:00:54 PM |
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yeah, he's been really great since 2007 |
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cypherdoc (OP)
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July 21, 2014, 07:50:25 PM |
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molecular
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July 21, 2014, 07:59:41 PM |
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hey cypherdoc, I appreciate your recent posting of related news items in here. I think it would add tremendous value if you pasted the title of the news item. |
PGP key molecular F9B70769 fingerprint 9CDD C0D3 20F8 279F 6BE0 3F39 FC49 2362 F9B7 0769
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bitjoint
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July 21, 2014, 08:07:42 PM |
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hey cypherdoc, I appreciate your recent posting of related news items in here.
I think it would add tremendous value if you pasted the title of the news item.
+1 |
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cypherdoc (OP)
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July 21, 2014, 08:33:07 PM |
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hey cypherdoc, I appreciate your recent posting of related news items in here. I think it would add tremendous value if you pasted the title of the news item. I'll try but these days I'm working more and more off my android and the copy paste function is still cumbersome & buggy. |
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Pruden
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July 21, 2014, 09:01:47 PM |
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Spain says to charge tax of 0.03 percent on bank depositsI already explained how irrelevant that news is, unless now you are reporting on every <0.1%GDP tax hike in every OECD country. This has nothing to do with the 20% Cyprus levy or anything like that.
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cypherdoc (OP)
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July 21, 2014, 09:19:10 PM |
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Spain says to charge tax of 0.03 percent on bank depositsI already explained how irrelevant that news is, unless now you are reporting on every <0.1%GDP tax hike in every OECD country. This has nothing to do with the 20% Cyprus levy or anything like that. How is it irrelevant? Any tax on deposits is preposterous no matter what country you're from. |
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jmw74
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July 21, 2014, 10:15:59 PM |
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What he also doesn't mention is that individuals can use bitcoin as a settlement mechanism directly and bypass both middlemen. But then where would Stripe fit in? It wouldn't. That's why they don't mention it. Maybe they know this is a possible outcome but figure the legacy networks will start using bitcoin first. I doubt that. I think individuals and companies will use it first. They already started. |
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