Gold collapsing. Bitcoin UP.

[cypherdoc]

While the concept of a "necessary backing" is a fallacy in my book

"Backing" is a kind of awkward hack that attempts to limit the production of currency.

It never really worked in the first place, and it's completely unnecessary now that we can just use math to limit the supply of the currency.

don't forget the concept of backing may continue forward as Bitcoin is Modular Gold - cypherdoc.

meaning we may end up plunking it into M1 in a 1 to 1 ratio with the USD monetary base forming a Bitcoin Standard serving as the foundation for the existing fiat debt system so as to prevent a severe debt implosion.

[1713542803]

1713542803

[justusranvier]

meaning we may end up plunking it into M1 in a 1 to 1 ratio with the USD monetary base forming a Bitcoin Standard serving as the foundation for the existing fiat debt system so as to prevent a severe debt implosion.

That's a thing that could be done, I suppose.

I consider it more likely that the USA goes the way of the USSR than the possibility that they could pull that kind of a rabbit out of their hat.

[boumalo]

We probably have 10%/year of real inflation in the US that should push Bitcoin and Gold higher

[wachtwoord]

We probably have 10%/year of real inflation in the US that should push Bitcoin and Gold higher

Try >50%. Look it up.

[cypherdoc]

We probably have 10%/year of real inflation in the US that should push Bitcoin and Gold higher

UST yields peaked in 1980 and have gone down ever since.  the real bull mkt in the US, and the greatest ever, has been in bonds

http://www.ritholtz.com/blog/2011/10/bonds-beat-stocks-1981-2011/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+TheBigPicture+%28The+Big+Picture%29.

[vuduchyld]

Yes!  The volume is the key.  Without it, a chart tells only half the story.

NL, the only thing i'd say about your arguments above is that i'd like to see gubmint play a "more" active role by loosening the choke points and regs that are restricting Bitcoin's free trade at the moment.  there is no doubt in my mind that Bitcoin would be much more widespread by now if they weren't interfering.

the other thing is that until the gubmint is willing to tie their fiat currency emission to Bitcoin, such as perhaps M1 to 21m BTC, they will continue to inflate the USD which is bad for everyone.  this has to stop.

Why M1 instead of M2? I've thought M2 was a better analog since it includes stored value, but I follow this thread religiously and value your thoughts on this.

[STT]

I hereby promise to give 1 oz of gold for 21,000,000 BTC or fractions of 1 oz of gold for respective fractions of Bitcoin to anyone who is willing to meet me in person. PM me if you want to redeem.

Here we go. Bitcoin is backed by gold.

There is a price already, 2.2293 btc per oz of gold

By trying to say you backed btc with gold, the scale is set to 21million per oz.    So instead of increasing the credibility of bitcoin, it now becomes like sand on a beach.    

     In a free market bitcoin must have a price/risk comparable to other assets, arbitrage makes this true of almost anything.    We cant just 'make it so' without resorting to the stupidity of communist party (or Nixon) price fixes and what that really means is less business is done.   In your case you are probably proposing that only you can give this exchange, because you undercut all other exchanges with your cheap price then business is restricted I think would be the effect.  
I think it would be so much more complicated and harder to do.   The immediate effect of every exchange offering this swap to gold would drop btc prices massively I think.  Exchange rates are not fixed without further problems

Peer to peer cryptography wont mix with gold, that value cannot be transmitted or codified

Yes!  The volume is the key.  Without it, a chart tells only half the story.

Volume of all major exchanges would be useful information to have.  Mt gox led to an inaccurate perspective so it would be best to have some average or weighting to trade done, that would help improve prediction most likely

[NewLiberty]

Yes!  The volume is the key.  Without it, a chart tells only half the story.

NL, the only thing i'd say about your arguments above is that i'd like to see gubmint play a "more" active role by loosening the choke points and regs that are restricting Bitcoin's free trade at the moment.  there is no doubt in my mind that Bitcoin would be much more widespread by now if they weren't interfering.

the other thing is that until the gubmint is willing to tie their fiat currency emission to Bitcoin, such as perhaps M1 to 21m BTC, they will continue to inflate the USD which is bad for everyone.  this has to stop.

Sure, but gubmint doesn't move in that direction, its activity goes the other way consistently and without remorse.  Perhaps some once and future government that is for and by the people, if and when that occurs, might see things differently. 
Don't forget that Government gets its money pre-inflation, and its only after it is spent into circulation and competes with the existing money that the effects of inflation occur.

Its laws allow it to steal bitcoin and resell it, entrapment or no.  Why would anyone expect this to change?
http://rt.com/usa/bitcoin-florida-laundering-arrest-431/

[NewLiberty]

I hereby promise to give 1 oz of gold for 21,000,000 BTC or fractions of 1 oz of gold for respective fractions of Bitcoin to anyone who is willing to meet me in person. PM me if you want to redeem.

Here we go. Bitcoin is backed by gold.

There is a price already, 2.2293 btc per oz of gold

By trying to say you backed btc with gold, the scale is set to 21million per oz.    So instead of increasing the credibility of bitcoin, it now becomes like sand on a beach.    

     In a free market bitcoin must have a price/risk comparable to other assets, arbitrage makes this true of almost anything.    We cant just 'make it so' without resorting to the stupidity of communist party (or Nixon) price fixes and what that really means is less business is done.   In your case you are probably proposing that only you can give this exchange, because you undercut all other exchanges with your cheap price then business is restricted I think would be the effect.  
I think it would be so much more complicated and harder to do.   The immediate effect of every exchange offering this swap to gold would drop btc prices massively I think.  Exchange rates are not fixed without further problems

Peer to peer cryptography wont mix with gold, that value cannot be transmitted or codified

Yes!  The volume is the key.  Without it, a chart tells only half the story.

Volume of all major exchanges would be useful information to have.  Mt gox led to an inaccurate perspective so it would be best to have some average or weighting to trade done, that would help improve prediction most likely

Bitcoin Specie project has been doing it, for real, with silver for quite a while now.
Gold will be added soonish.
http://coldhardca.sh
The higher the volume, the lower the premium and closer to the spot alloy price.

[cypherdoc]

Yes!  The volume is the key.  Without it, a chart tells only half the story.

NL, the only thing i'd say about your arguments above is that i'd like to see gubmint play a "more" active role by loosening the choke points and regs that are restricting Bitcoin's free trade at the moment.  there is no doubt in my mind that Bitcoin would be much more widespread by now if they weren't interfering.

the other thing is that until the gubmint is willing to tie their fiat currency emission to Bitcoin, such as perhaps M1 to 21m BTC, they will continue to inflate the USD which is bad for everyone.  this has to stop.

Why M1 instead of M2? I've thought M2 was a better analog since it includes stored value, but I follow this thread religiously and value your thoughts on this.

well, you're guess is as good as mine.

i chose M1 b/c it represents liquid money much like Bitcoin:

[HeliKopterBen]

@nl

I get what you are saying.  I guess it depends on the individual's interpretation of the term "backing."

[STT]

Bitcoin Specie project has been doing it, for real, with silver for quite a while now.
Gold will be added soonish.
http://coldhardca.sh
The higher the volume, the lower the premium and closer to the spot alloy price.

How do I buy the silver from them ?   Its not a backing as such I guess, they are offering to sell.  Main problem is usually postage and customs.    I'd change my mind if the Perth mint allowed depositbullion to be purchased in bitcoin and then it would be useful to be.  One day I could go collect it even, ruling out delivery problems

[HeliKopterBen]

meaning we may end up plunking it into M1 in a 1 to 1 ratio with the USD monetary base forming a Bitcoin Standard serving as the foundation for the existing fiat debt system so as to prevent a severe debt implosion.

That's a thing that could be done, I suppose.

I consider it more likely that the USA goes the way of the USSR than the possibility that they could pull that kind of a rabbit out of their hat.

I can't see it either.  They would be building a proven failed layer on top of a proven successful system.  It would basically be a centralized side chain controlled by the US government.  I don't see how people would be incentivized to use that when they can use a decentralized solution... maybe not bitcoin directly but a decentralized side chain of sorts.  Perhaps people would still use a government sponsored currency because government would provide insurance (FDIC) against theft and loss, but private insurance solutions can work just as good or better for that.  However, government always seems to find a way to maintain control but I believe their power will be weakened, and there may be a certain segment of the population that will always choose to use a government sponsored currency.

[vuduchyld]

Hellifino.  I've used m2 in calcs because of that check next to savings deposits.  I believe people treat it as such when they HODL, but I'm not an economist.

[NewLiberty]

Bitcoin Specie project has been doing it, for real, with silver for quite a while now.
Gold will be added soonish.
http://coldhardca.sh
The higher the volume, the lower the premium and closer to the spot alloy price.

How do I buy the silver from them ?   Its not a backing as such I guess, they are offering to sell.  Main problem is usually postage and customs.    I'd change my mind if the Perth mint allowed depositbullion to be purchased in bitcoin and then it would be useful to be.  One day I could go collect it even, ruling out delivery problems

Its available direct in quantity, or through many of the bitcoin bullion sellers.  Most also offer international shipping.
Vaulting is available at the mint by custom agreement.

Agora Commodities in US
https://agoracommodities.com/product/silver-bitcoin-specie/

HardBTC.org in UK
http://hardbtc.org/ocart/index.php?route=product/category&path=64

Bitgild.com in NL

[cypherdoc]

gold back below support after dead cat bounce:

[cypherdoc]

Bitcoin forming a daily swing low reversal UP on volume expected to be higher by days end:

[cypherdoc]

Silver, oh noes!  who leads again?

[cypherdoc]

it looks to me that mining would be best described as being in a Pure Strategy Nash Equilibrium - cypherdoc
Highlights are mine:

"A pure strategy Nash equilibrium is a profile of strategies such that each player’s (miner's) strategy is a best response ((results in the highest available payoff (block reward)) against the equilibrium strategies of the other players (miners).

A pure strategy Nash equilibrium only requires that the action taken by each agent (miner) be best against the actual equilibrium actions taken by the other players (miners), and not necessarily against all possible actions of the other players (miners). In other words, it's expected for some miners to be malicious.

A Nash equilibrium has the nice property that it is stable: if each player expects 'a' to be the profile of actions played, then no player (miner) has any incentive to change his or her action (no incentive to start cheating). In other words, no player (miner) regrets having played the action that he or she played in a Nash equilibrium."

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1968579

[adamstgBit]

Silver, oh noes!  who leads again?

silver will make a new all time recent low and then it might make sense to store some long term value in it.