Gold collapsing. Bitcoin UP.

[justusranvier]

You guys might find this interesting: http://www.reddit.com/r/Bitcoin/comments/2exd3e/bitcoin_btcd_and_golang/

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[Adrian-x]

"Why Bitcoin is Better Than Gold, with Wences Casares"
https://www.youtube.com/watch?v=gKkfhi8Eaiw


I think his talk from Bitcoin2014 (https://www.youtube.com/watch?v=NERAN-89j8M) is better, but the above is shorter and more recent (published today).

"Barter never happened" This is the truth. It's the debt, stupid....

thats not stupid thats just true

think about it, if there was a lazy ass in the trib that called everyone names and never did anything, you think poeple would feel the owe him anything ever? so why would the help him out and "Barter", nope, its always been, poeple keeping track of who owes who.

this is just how humans interact, Barter never happened, deal with it.
 

its a good point he makes.

Barter evolved as a form of settlement between 0 trust parties. The traders on the old silk road for eg. But first and foremost it was the community and yes communities were debt based.

[Zarathustra]

I have a problem with this debt creation means deflation meme.

In a restricted economic model, where we have some actors and some money, the value of each unit of money depends only on the actors willingness to hold. The demand and supply sides consists of the same people, where demand is the wish to hold more, and supply is the less willingness to hold.

Extending this with debt, a debt which is safe and of static volume, extends the money supply. The debt is more like money if it is transferable. If a debt is completely safe, have very low interest and is due very long time in the future, and is transferable, it is in practise equivalent to money.

In all cases up till now in the model, the money supply is static and we should have stable price level on goods in the market.

Extending the model again, now with an expanding money supply in the form of base money and debt, which is the current situation in the world, value of the money unit should fall, as the supply is now the willingness to hold less plus the new money, demand being the willingness to hold is the same.

Now the big unknown, hitherto considered static, is the willingness to hold. This is of course not static in the real world, as it depends on the actors life situation and the world situation, including the important prospect of the future value of the money. Basically, if there is an expectation that the money will fall in value, people will hold less money and hold long lasting, transferable goods instead. But this will only accelerate the fall of the value of the money, it will not be an upward pressure of the value of the money unit (otherwise called deflation).

I do not disagree that deflation is a real risk (or that it is happening now), i disagree only that it is the expanding money supply in the form of debt that is the reason for it.

In my view, it is a collapse of debt that is the reason for a possible deflation. A collapse of debt will happen when the market actors consider the risk of lending too high, or when other risks make people hoard wealth in the form of long lasting consumer goods like houses and cars, paid not with loans but paid for by less consumption of other goods.

The 'money supply' is only a fraction of total debt (USA 60 trillion). As long as debt creation in an economy is faster than productivity, you'll have inflation. As soon as the total debt sum doesn't increase as fast as productivity, you'll have deflation (Japan first and now the rest of the western world following).

Good point.  Increasing productivity has been known to cause deflation since at least Adam Smith (1776).  I still don't see how collapse of debt (which reduces the demand for money because now that debt isn't going to be repaid) causes deflation.  If you have to make debt payments, you will try make sure you have enough dollars to pay them.  This is why debt increases demand for dollars.  Again, yes initial issuance is short term inflationary, but I don't see how you can claim it is inflationary overall.

Imagine that 99 pct of the 60 trillions of debt would be wiped out. That means that the other side of the balance sheet would be wiped out as well. The price level in the economy would return to that level on which it had been as the total debt sum was at 0.6 trillions.

[Zarathustra]

"Why Bitcoin is Better Than Gold, with Wences Casares"
https://www.youtube.com/watch?v=gKkfhi8Eaiw


I think his talk from Bitcoin2014 (https://www.youtube.com/watch?v=NERAN-89j8M) is better, but the above is shorter and more recent (published today).

"Barter never happened" This is the truth. It's the debt, stupid....

thats not stupid thats just true

think about it, if there was a lazy ass in the trib that called everyone names and never did anything, you think poeple would feel the owe him anything ever? so why would the help him out and "Barter", nope, its always been, poeple keeping track of who owes who.

this is just how humans interact, Barter never happened, deal with it.
 

its a good point he makes.

But first and foremost it was the community and yes communities were debt based.

Yes, human life can be called 'debitism' (Dr. Paul C. Martin) from the very beginning. That worked perfectly in a world of communities. That's the difference to the society, which is the perversion of the community. A society needs organized violence (state and church) to handle the debt.

[NewLiberty]

"Why Bitcoin is Better Than Gold, with Wences Casares"
https://www.youtube.com/watch?v=gKkfhi8Eaiw


I think his talk from Bitcoin2014 (https://www.youtube.com/watch?v=NERAN-89j8M) is better, but the above is shorter and more recent (published today).

"Barter never happened" This is the truth. It's the debt, stupid....

thats not stupid thats just true

think about it, if there was a lazy ass in the trib that called everyone names and never did anything, you think poeple would feel the owe him anything ever? so why would the help him out and "Barter", nope, its always been, poeple keeping track of who owes who.

this is just how humans interact, Barter never happened, deal with it.
 

its a good point he makes.

Yes, I fully agree with him.

Barter was common between tribes, not so much within them.  It still is.

[Zarathustra]

"Why Bitcoin is Better Than Gold, with Wences Casares"
https://www.youtube.com/watch?v=gKkfhi8Eaiw


I think his talk from Bitcoin2014 (https://www.youtube.com/watch?v=NERAN-89j8M) is better, but the above is shorter and more recent (published today).

"Barter never happened" This is the truth. It's the debt, stupid....

thats not stupid thats just true

think about it, if there was a lazy ass in the trib that called everyone names and never did anything, you think poeple would feel the owe him anything ever? so why would the help him out and "Barter", nope, its always been, poeple keeping track of who owes who.

this is just how humans interact, Barter never happened, deal with it.
 

its a good point he makes.

Yes, I fully agree with him.

Barter was common between tribes, not so much within them.  It still is.

It wasn't. They were self-sufficient.

[rocks]

"Why Bitcoin is Better Than Gold, with Wences Casares"
https://www.youtube.com/watch?v=gKkfhi8Eaiw


I think his talk from Bitcoin2014 (https://www.youtube.com/watch?v=NERAN-89j8M) is better, but the above is shorter and more recent (published today).

"Barter never happened" This is the truth. It's the debt, stupid....

thats not stupid thats just true

think about it, if there was a lazy ass in the trib that called everyone names and never did anything, you think poeple would feel the owe him anything ever? so why would the help him out and "Barter", nope, its always been, poeple keeping track of who owes who.

this is just how humans interact, Barter never happened, deal with it.
 

its a good point he makes.

Thought people here might like this comment from the above youtube video

If gold and silver are better than Bitcoin, why don't any businesses accept it for payment?  Bitcoin is accepted by tens of thousands of businesses, including very large merchants like Overstock, Newegg, and TigerDirect.

Gold bugs (and I used to be one) are all sitting around waiting for the other 99% of humanity to wake up and see gold as the true sound money platform, and in the process both vindicate themselves as being "right" and become rich in the process.

However, while they are patiently waiting decades, bitcoin adoption will grow and grow, realizing the vision they have for gold. At some point more and more gold bugs will switch, bitcoin is the sound money vindication they have been waiting for, it is just a different platform.

[NewLiberty]

Thought people here might like this comment from the above youtube video

If gold and silver are better than Bitcoin, why don't any businesses accept it for payment?  Bitcoin is accepted by tens of thousands of businesses, including very large merchants like Overstock, Newegg, and TigerDirect.

Gold bugs (and I used to be one) are all sitting around waiting for the other 99% of humanity to wake up and see gold as the true sound money platform, and in the process both vindicate themselves as being "right" and become rich in the process.

However, while they are patiently waiting decades, bitcoin adoption will grow and grow, realizing the vision they have for gold. At some point more and more gold bugs will switch, bitcoin is the sound money vindication they have been waiting for, it is just a different platform.

I really don't mind being paid in gold.  I actually like it quite a bit when it happens.
That is rare though.  Being paid in bitcoin is preferred to being paid in fiat.
Folks with gold rarely like to part with it.  Bitcoin is so much more liquid and divisible, so we should expect it to be more frequently transacted.
But, I still like being paid in gold when I can be.

[wachtwoord]

"Why Bitcoin is Better Than Gold, with Wences Casares"
https://www.youtube.com/watch?v=gKkfhi8Eaiw


I think his talk from Bitcoin2014 (https://www.youtube.com/watch?v=NERAN-89j8M) is better, but the above is shorter and more recent (published today).

"Barter never happened" This is the truth. It's the debt, stupid....

thats not stupid thats just true

think about it, if there was a lazy ass in the trib that called everyone names and never did anything, you think poeple would feel the owe him anything ever? so why would the help him out and "Barter", nope, its always been, poeple keeping track of who owes who.

this is just how humans interact, Barter never happened, deal with it.
 

its a good point he makes.

Yes, I fully agree with him.

Barter was common between tribes, not so much within them.  It still is.

Exactly. You don't pay your wife to wash your clothes

[adamstgBit]

Thought people here might like this comment from the above youtube video

If gold and silver are better than Bitcoin, why don't any businesses accept it for payment?  Bitcoin is accepted by tens of thousands of businesses, including very large merchants like Overstock, Newegg, and TigerDirect.

Gold bugs (and I used to be one) are all sitting around waiting for the other 99% of humanity to wake up and see gold as the true sound money platform, and in the process both vindicate themselves as being "right" and become rich in the process.

However, while they are patiently waiting decades, bitcoin adoption will grow and grow, realizing the vision they have for gold. At some point more and more gold bugs will switch, bitcoin is the sound money vindication they have been waiting for, it is just a different platform.

I really don't mind being paid in gold.  I actually like it quite a bit when it happens.
That is rare though.  Being paid in bitcoin is preferred to being paid in fiat.
Folks with gold rarely like to part with it.  Bitcoin is so much more liquid and divisible, so we should expect it to be more frequently transacted.
But, I still like being paid in gold when I can be.

yes i like to receive physical gold with costly insured shipping as payment as well. because i know i can turn around and with another costly insured shipping send said gold to silvergoldbull and get spot -1% paided out in BTC. i also like the fact there is no exchange rate volatility risk with gold, because gold is rock solid.

[cypherdoc]

Crap. I missed the wall take down. Was on a bike ride. How did it happen? Did one or all of the walls get taken down at once or piece meal?

Whatever, it's a great victory for the bulls who stared  those walls down for almost 24 hours. That'll teach 'em.

[notme]

Crap. I missed the wall take down. Was on a bike ride. How did it happen? Did one or all of the walls get taken down at once or piece meal?

Whatever, it's a great victory for the bulls who stared  those walls down for almost 24 hours. That'll teach 'em.

I only saw stamp and bitfinex, but both were swallowed in a matter of minutes.

[notme]

I have a problem with this debt creation means deflation meme.

In a restricted economic model, where we have some actors and some money, the value of each unit of money depends only on the actors willingness to hold. The demand and supply sides consists of the same people, where demand is the wish to hold more, and supply is the less willingness to hold.

Extending this with debt, a debt which is safe and of static volume, extends the money supply. The debt is more like money if it is transferable. If a debt is completely safe, have very low interest and is due very long time in the future, and is transferable, it is in practise equivalent to money.

In all cases up till now in the model, the money supply is static and we should have stable price level on goods in the market.

Extending the model again, now with an expanding money supply in the form of base money and debt, which is the current situation in the world, value of the money unit should fall, as the supply is now the willingness to hold less plus the new money, demand being the willingness to hold is the same.

Now the big unknown, hitherto considered static, is the willingness to hold. This is of course not static in the real world, as it depends on the actors life situation and the world situation, including the important prospect of the future value of the money. Basically, if there is an expectation that the money will fall in value, people will hold less money and hold long lasting, transferable goods instead. But this will only accelerate the fall of the value of the money, it will not be an upward pressure of the value of the money unit (otherwise called deflation).

I do not disagree that deflation is a real risk (or that it is happening now), i disagree only that it is the expanding money supply in the form of debt that is the reason for it.

In my view, it is a collapse of debt that is the reason for a possible deflation. A collapse of debt will happen when the market actors consider the risk of lending too high, or when other risks make people hoard wealth in the form of long lasting consumer goods like houses and cars, paid not with loans but paid for by less consumption of other goods.

The 'money supply' is only a fraction of total debt (USA 60 trillion). As long as debt creation in an economy is faster than productivity, you'll have inflation. As soon as the total debt sum doesn't increase as fast as productivity, you'll have deflation (Japan first and now the rest of the western world following).

Good point.  Increasing productivity has been known to cause deflation since at least Adam Smith (1776).  I still don't see how collapse of debt (which reduces the demand for money because now that debt isn't going to be repaid) causes deflation.  If you have to make debt payments, you will try make sure you have enough dollars to pay them.  This is why debt increases demand for dollars.  Again, yes initial issuance is short term inflationary, but I don't see how you can claim it is inflationary overall.

Imagine that 99 pct of the 60 trillions of debt would be wiped out. That means that the other side of the balance sheet would be wiped out as well. The price level in the economy would return to that level on which it had been as the total debt sum was at 0.6 trillions.

Sure the banks would lose a lot of "assets" but all the entities who owed that money previously would find themselves keeping more of their income.  We know the banks aren't spending, but can we count on the general population and the government to sit on a surplus?

[cypherdoc]

Crap. I missed the wall take down. Was on a bike ride. How did it happen? Did one or all of the walls get taken down at once or piece meal?

Whatever, it's a great victory for the bulls who stared  those walls down for almost 24 hours. That'll teach 'em.

I only saw stamp and bitfinex, but both were swallowed in a matter of minutes.

So the manipulator actually lost control of the coins as opposed to pulling down the wall? That's bullish as he will be forced to buy back later.

[adamstgBit]

Crap. I missed the wall take down. Was on a bike ride. How did it happen? Did one or all of the walls get taken down at once or piece meal?

Whatever, it's a great victory for the bulls who stared  those walls down for almost 24 hours. That'll teach 'em.

I only saw stamp and bitfinex, but both were swallowed in a matter of minutes.

So the manipulator actually lost control of the coins as opposed to pulling down the wall? That's bullish as he will be forced to buy back later.

he kept putting up fresh walls as it was being bought, he wasted all 2K on the front line.

[FNG]

Crap. I missed the wall take down. Was on a bike ride. How did it happen? Did one or all of the walls get taken down at once or piece meal?

Whatever, it's a great victory for the bulls who stared  those walls down for almost 24 hours. That'll teach 'em.

I only saw stamp and bitfinex, but both were swallowed in a matter of minutes.

So the manipulator actually lost control of the coins as opposed to pulling down the wall? That's bullish as he will be forced to buy back later.

he kept putting up fresh walls as it was being bought, he wasted all 2K on the front line.

Nice. Will suck for him as we breach 520

[Erdogan]

I have a problem with this debt creation means deflation meme.

In a restricted economic model, where we have some actors and some money, the value of each unit of money depends only on the actors willingness to hold. The demand and supply sides consists of the same people, where demand is the wish to hold more, and supply is the less willingness to hold.

Extending this with debt, a debt which is safe and of static volume, extends the money supply. The debt is more like money if it is transferable. If a debt is completely safe, have very low interest and is due very long time in the future, and is transferable, it is in practise equivalent to money.

In all cases up till now in the model, the money supply is static and we should have stable price level on goods in the market.

Extending the model again, now with an expanding money supply in the form of base money and debt, which is the current situation in the world, value of the money unit should fall, as the supply is now the willingness to hold less plus the new money, demand being the willingness to hold is the same.

Now the big unknown, hitherto considered static, is the willingness to hold. This is of course not static in the real world, as it depends on the actors life situation and the world situation, including the important prospect of the future value of the money. Basically, if there is an expectation that the money will fall in value, people will hold less money and hold long lasting, transferable goods instead. But this will only accelerate the fall of the value of the money, it will not be an upward pressure of the value of the money unit (otherwise called deflation).

I do not disagree that deflation is a real risk (or that it is happening now), i disagree only that it is the expanding money supply in the form of debt that is the reason for it.

In my view, it is a collapse of debt that is the reason for a possible deflation. A collapse of debt will happen when the market actors consider the risk of lending too high, or when other risks make people hoard wealth in the form of long lasting consumer goods like houses and cars, paid not with loans but paid for by less consumption of other goods.

The 'money supply' is only a fraction of total debt (USA 60 trillion). As long as debt creation in an economy is faster than productivity, you'll have inflation. As soon as the total debt sum doesn't increase as fast as productivity, you'll have deflation (Japan first and now the rest of the western world following).

I of course include debt in the money supply, see above (red).

[Erdogan]

"Why Bitcoin is Better Than Gold, with Wences Casares"
https://www.youtube.com/watch?v=gKkfhi8Eaiw


I think his talk from Bitcoin2014 (https://www.youtube.com/watch?v=NERAN-89j8M) is better, but the above is shorter and more recent (published today).

"Barter never happened" This is the truth. It's the debt, stupid....

Indirect trade is more effective, but barter happens all the time. A merger where shareholders of the bought company are paid with shares in the new company, is barter.

[Erdogan]

I have a problem with this debt creation means deflation meme.

In a restricted economic model, where we have some actors and some money, the value of each unit of money depends only on the actors willingness to hold. The demand and supply sides consists of the same people, where demand is the wish to hold more, and supply is the less willingness to hold.

Extending this with debt, a debt which is safe and of static volume, extends the money supply. The debt is more like money if it is transferable. If a debt is completely safe, have very low interest and is due very long time in the future, and is transferable, it is in practise equivalent to money.

In all cases up till now in the model, the money supply is static and we should have stable price level on goods in the market.

Extending the model again, now with an expanding money supply in the form of base money and debt, which is the current situation in the world, value of the money unit should fall, as the supply is now the willingness to hold less plus the new money, demand being the willingness to hold is the same.

Now the big unknown, hitherto considered static, is the willingness to hold. This is of course not static in the real world, as it depends on the actors life situation and the world situation, including the important prospect of the future value of the money. Basically, if there is an expectation that the money will fall in value, people will hold less money and hold long lasting, transferable goods instead. But this will only accelerate the fall of the value of the money, it will not be an upward pressure of the value of the money unit (otherwise called deflation).

I do not disagree that deflation is a real risk (or that it is happening now), i disagree only that it is the expanding money supply in the form of debt that is the reason for it.

In my view, it is a collapse of debt that is the reason for a possible deflation. A collapse of debt will happen when the market actors consider the risk of lending too high, or when other risks make people hoard wealth in the form of long lasting consumer goods like houses and cars, paid not with loans but paid for by less consumption of other goods.

The 'money supply' is only a fraction of total debt (USA 60 trillion). As long as debt creation in an economy is faster than productivity, you'll have inflation. As soon as the total debt sum doesn't increase as fast as productivity, you'll have deflation (Japan first and now the rest of the western world following).

Good point.  Increasing productivity has been known to cause deflation since at least Adam Smith (1776).  I still don't see how collapse of debt (which reduces the demand for money because now that debt isn't going to be repaid) causes deflation.  If you have to make debt payments, you will try make sure you have enough dollars to pay them.  This is why debt increases demand for dollars.  Again, yes initial issuance is short term inflationary, but I don't see how you can claim it is inflationary overall.

Decreasing prices due to increased productivity should not scare anyone, that was how Britain evolved from 5 million hungry people to 50 million well fed people.

[cypherdoc]

I have a problem with this debt creation means deflation meme.

In a restricted economic model, where we have some actors and some money, the value of each unit of money depends only on the actors willingness to hold. The demand and supply sides consists of the same people, where demand is the wish to hold more, and supply is the less willingness to hold.

Extending this with debt, a debt which is safe and of static volume, extends the money supply. The debt is more like money if it is transferable. If a debt is completely safe, have very low interest and is due very long time in the future, and is transferable, it is in practise equivalent to money.

In all cases up till now in the model, the money supply is static and we should have stable price level on goods in the market.

Extending the model again, now with an expanding money supply in the form of base money and debt, which is the current situation in the world, value of the money unit should fall, as the supply is now the willingness to hold less plus the new money, demand being the willingness to hold is the same.

Now the big unknown, hitherto considered static, is the willingness to hold. This is of course not static in the real world, as it depends on the actors life situation and the world situation, including the important prospect of the future value of the money. Basically, if there is an expectation that the money will fall in value, people will hold less money and hold long lasting, transferable goods instead. But this will only accelerate the fall of the value of the money, it will not be an upward pressure of the value of the money unit (otherwise called deflation).

I do not disagree that deflation is a real risk (or that it is happening now), i disagree only that it is the expanding money supply in the form of debt that is the reason for it.

In my view, it is a collapse of debt that is the reason for a possible deflation. A collapse of debt will happen when the market actors consider the risk of lending too high, or when other risks make people hoard wealth in the form of long lasting consumer goods like houses and cars, paid not with loans but paid for by less consumption of other goods.

The 'money supply' is only a fraction of total debt (USA 60 trillion). As long as debt creation in an economy is faster than productivity, you'll have inflation. As soon as the total debt sum doesn't increase as fast as productivity, you'll have deflation (Japan first and now the rest of the western world following).

I of course include debt in the money supply, see above (red).

Yes, any definition of money supply needs to include debt.