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Author Topic: A day in the life of a pirate.  (Read 28338 times)
bulanula
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May 23, 2012, 10:25:40 PM
 #141

I've said it all along and I will say it now.

I think all the people envying pirate are haters / jealous of his success.

Thanks for the clarification, pirate !
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May 24, 2012, 12:18:22 AM
 #142

Mods, please move this post if its in the wrong section.  Thanks

Howdy Y'all

So there seems to be an ever-growing list of topics and links regarding information about what exactly I do to pay my lenders.  Most of the information seems to be fabricated by people wearing pointy foil hats.  On the other hand there are a few respected members of the community that seem to have fallen into the FUD world which has become... this forum.  As you can imagine, knowing what I know about what I do, it's been pretty entertaining to watch.  I must admit, I do enjoy the thrill of getting a reaction from some of these nuts, but there does come a time when you have to stop throwing fuel on the fire.

What do I do?  Lots, and you couldn't pay me enough to tell how I do it.  Why?  Cause, as most of you know I've made a lot of money doing this and I'm simply not going to kill a good thing for now.  Currently I don't have to fund any portion of BTCS&T due to my extensive list of lenders and like any professional would tell you... Don't tie up your cash unless you have to.  So if there was enough time-consuming BS going around that drove me to either disclose what I do exactly (and thus kill my profit margins) or fund the operation myself and increase my profit margin, you can imagine which one I'd choose.

At this time, I don't need to make that decision.  I know what I do and have every right to what I disclose about my process.  So, now lets get to the good stuff.

Q - Are you running a drug ring and laundering money for Silk Road?
A - Are you kidding me? I live in the US.  If anything I was doing was illegal, my CPA, attorneys, and scariest... my wife would have my head.  So to make it clear, nothing I'm associated with is illegal.

Q - Are you the mystery Bitcoinica investor?
A - No, although I thought about it early on when I was looking into the different sectors, but coming from forex trading there would be so much I would change that it would be much easier to build it from scratch.

Q - Did you hack Bitcoinica or help to launder the coins?
A - No, as some of you know I have an extensive list of certifications but all of them are networking and datacenter related.  I have business partners that handle all of the coding work and a few friends that fill in the gaps when needed.  Honestly I wouldn't know if stolen coins are being moved in and out of BTCS&T or GPUMAX. We don't have systems in place to check for them nor would I add them, due to the simple fact that I'm not here to police the market, nor do I condone the practice. If someone steals your cash out of your wallet and you have the serial numbers, do you think anyone would care?

Q - Is BTCS&T a Ponzi?
A - Although, theoretically I could have run a Ponzi scheme for a while early on, it just wasn't something I would ever want to be a part of.  If I wanted it to be one, it would have been at much lower rates and I'd be asking for everyone to join.

Q - What's up with the check warrant?
A - Those of you that have contacted me about this knew really early on about it.  The check is for a tiny amount at a Lowe's hardware store in a city I lived in for two years back in 2002-2003.  The check is for some company I have never heard of and haven't been able to find any information about.  My drivers license number was written on the top of the check so it was associated with me.  I didn't hear about this till years later when I was Googling myself and called to find out what it was and attempt to get it fixed.  I just wanted to pay it to clear my record but they required me to confirm some information on the check which I couldn't do and would have to file a police report as well as setup a court date to deal with it.  It just wasn't worth my time and could really care less about it.  If I'm ever out in the desert again and get pulled over, maybe then they'll let me pay it.

I hope this information helps, but I know its not what some of you wanted.  In the end, the only people I care about are my lenders and even then, they don't have to invest with me if they're worried about what I'm doing.

A big thanks to all of my lenders and those that support my projects.  I do sleep sometimes and can't always see everything that is said about me on the forums but I can tell you that it's a breath of fresh air to wake up and see how many of you have my back when I'm not around.  It doesn't go unnoticed and want you to know I'm here and plan to be for a while.

Now, on with the show.

EDIT: There are a couple of people that I know doing the exact same thing I do.  One in the states and one in the UK.  Early on they both contacted me within days of each other asking for some tips on how I handled the process.  Now this was after a very detailed description of what they thought I was doing.  Considering they're not in my area and we'd end up helping each other out, I decided I'd lend a hand in getting them off the ground.  We've keep in contact and to-date (based on how many of you have no idea what's going on) they've kept the information I've told them secret and I can't tell you what that means to me.

Now, I never expect anything in return and this is not a call for them to come forward in the least (they know that).  I simply wanted to mention it and say thanks.



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May 24, 2012, 01:11:01 AM
 #143

The simple truth is that if one can make 10% per week, one does not need any investments really. One can take some relatively small loan at the most horrible possible rates and simply give it some time until power of compound interest makes one unbelievably rich. 10% per week means that you double your money every 7 weeks. Remember that fable about chessboard and rice grains?

IMO it makes no biz sense whatsoever to seek outside investments and pay 10% per week dividend unless it is a ponzi scheme or some kind or quasi/secondary ponzi scheme or otherwise an extremely risky venture.

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May 24, 2012, 01:16:19 AM
 #144

The simple truth is that if one can make 10% per week, one does not need any investments really. One can take some relatively small loan at the most horrible possible rates and simply give it some time until power of compound interest makes one unbelievably rich. 10% per week means that you double your money every 7 weeks. Remember that fable about chessboard and rice grains?

IMO it makes no biz sense whatsoever to seek outside investments and pay 10% per week dividend unless it is a ponzi scheme or some kind or quasi/secondary ponzi scheme.


Some people's reply to that has been that pirateat40's modus operandi needs a *bitcoin*-based loan, so he can't just go to the bank/uncle and get a USD loan.


But, even in the bitcoin world, one wonders: Why did pirateat40 offer 1%/day to begin with? People would have gladly invested even with Pirate even with a smaller offer.


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May 24, 2012, 01:18:54 AM
 #145

Some people's reply to that has been that pirateat40's modus operandi needs a *bitcoin*-based loan, so he can't just go to the bank/uncle and get a USD loan.

Is it that difficult to convert USD to BTC? Is it so difficult that one would prefer to pay 6000% annually for BTC instead of USD's horrible 40-70% loan shark interest or 15% on a credit card?

If so come to me and I'll sell you as many BTC as you need at 10$/BTC this would save you tons of money. Ohh wait, btcinstant or bit-pay will do that for only 3-4% not 100% as I just offered.






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May 24, 2012, 01:25:50 AM
 #146

Is it that difficult to convert USD to BTC?

Not at all, but it does change your risk model.


Is it so difficult that one would prefer to pay 6000% annually for BTC instead of USD's horrible 40-70% loan shark interest or 15% on a credit card?

Not arguing there. That's a bit boggling to me as well.

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May 24, 2012, 01:27:15 AM
 #147

Does it increase risk 100-1000 times?


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May 24, 2012, 01:30:56 AM
 #148

Does it increase risk 100 times?

Yes, in fact, even by \infty (chance of losing everything), depending on the model.



 

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May 24, 2012, 01:34:41 AM
 #149

Could you clarify please. What would be an example of an operation where having USD liabilites as opposed BTC liabilities is by 2-3 orders of magnitude more risky?

Why those risks could not be hedged or otherwise mitigated cost efficiently?

Why would anyone want to invest any BTC on GLBSE into such a venture?





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pirateat40
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May 24, 2012, 02:03:48 AM
 #150

Could you clarify please. What would be an example of an operation where having USD liabilites as opposed BTC liabilities is by 2-3 orders of magnitude more risky?




Ok lets say your business was in "pet rocks".  Now, there's a demand for them from an active but relatively small community (like Bitcoin) that believe these rocks are worth their weight in gold.  So you run to your bank and withdraw everything you can, hell you might even ask the banker for a loan.  You tell him it's for some home remodeling and because he's known you since grade school you get the loan.  With money in hand you run to the rock market and spend everything you got on certified "Pet Rocks". 

You get your business off the ground while paying off the loan but in the back of your mind you can't shake the thought of "What happens if people find out these are just rocks or if the rock market is overtaken by nano pets?".  You take the risk and keep building your business by reinvesting your profits back into buying more rocks.

You wake up one morning, roll over and look at your phone to see the current price of "pet rocks" to be worthless.  With a ill feeling creeping over your body you start to think about how many rocks you have in the warehouse and how much money you've actually creamed off the top.

Why didn't I just borrow the rocks from the rock community and pay them a portion of my profits?  That way if something was to happen, I made good money doing it and my long time friend (the banker) still likes me.

I don't know about you but that's what risk management means to me. Smiley


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May 24, 2012, 02:17:01 AM
 #151

This does not explain desire to pay 2-3 order of magnitude higher interest. This also demonstrates that such GLBSE shares based on value of "pet rocks" would offload some unspecified but huge risks to "investors".

Also you completely ignored BTC risk mitigation options that ought to be by orders of magnitude less expensive than 6000% annual interest rate.

Basically you have failed to coherently answer the 3 questions which really make more sense in combination.

What you said is basically let's suppose BTC are as worthless as pet rocks and it makes sense for me to pay 6000% per annum on those pet rocks.

I am still at loss on why would one prefer to pay 2-3 orders of magnitude more interest only to mitigate currency exchange risk. Based on historical volatility of BTCUSD currency exchange risk is not that big. This in combination with biz prowess allowing one to generate such outlandish returns makes even less sense.



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pirateat40
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May 24, 2012, 02:20:42 AM
 #152

This does not explain desire to pay 2-3 order of magnitude higher interest. This also demonstrates that such GLBSE shares based on value of "pet rocks" would offload some unspecified but huge risks to "investors".

Also you completely ignored BTC risk mitigation options that ought to be by orders of magnitude less expensive than 6000% annual interest rate.

Basically you have filed to coherently answer the 3 questions which really make more sense in combination.

What you said is basically let's suppose BTC are as worthless as pet rocks and it makes sense for me to pay 6000% per annum on those pet rocks.

I am still at loss on why would one prefer to pay 2-3 orders of magnitude more interest only to mitigate currency exchange risk. Based on historical volatility of BTCUSD currency exchange risk is not that big.



That's the beauty of what makes people different, you don't have to understand.  I do Smiley

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May 24, 2012, 02:22:57 AM
 #153

That's the beauty of what makes people different, you don't have to understand.  I do Smiley

Of course, I do not have to understand. But until I understand, Occam's razor suggests this https://bitcointalk.org/index.php?topic=82849.msg915121#msg915121 .

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May 24, 2012, 02:23:53 AM
 #154


So you don’t really believe Bitcoin will be successful (or at least you don’t know if it will) so you’re not going to risk any of your own money when you can risk the money of others.

No no, in the current scenario being discussed, pirateat40's not reneging on any promises.

The lenders *agreed* to be paid back in bitcoins.

So, yes, their btc are worthless, but that's part of their contract and their choice.




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pirateat40
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May 24, 2012, 02:27:14 AM
 #155

Could you clarify please. What would be an example of an operation where having USD liabilites as opposed BTC liabilities is by 2-3 orders of magnitude more risky?




Ok lets say your business was in "pet rocks".  Now, there's a demand for them from an active but relatively small community (like Bitcoin) that believe these rocks are worth their weight in gold.  So you run to your bank and withdraw everything you can, hell you might even ask the banker for a loan.  You tell him it's for some home remodeling and because he's known you since grade school you get the loan.  With money in hand you run to the rock market and spend everything you got on certified "Pet Rocks".  

You get your business off the ground while paying off the loan but in the back of your mind you can't shake the thought of "What happens if people find out these are just rocks or if the rock market is overtaken by nano pets?".  You take the risk and keep building your business by reinvesting your profits back into buying more rocks.

You wake up one morning, roll over and look at your phone to see the current price of "pet rocks" to be worthless.  With a ill feeling creeping over your body you start to think about how many rocks you have in the warehouse and how much money you've actually creamed off the top.

Why didn't I just borrow the rocks from the rock community and pay them a portion of my profits?  That way if something was to happen, I made good money doing it and my long time friend (the banker) still likes me.

I don't know about you but that's what risk management means to me. Smiley



So you don’t really believe Bitcoin will be successful (or at least you don’t know if it will) so you’re not going to risk any of your own money when you can risk the money of others. In the mean time you can milk the cow dry and make money for as long as it lasts with limited personal risk. That’s perfectly rational and a very sound personal risk management strategy.


He he... see I knew this was coming but figured it would be from Vladimir.  I personally believe in Bitcoin and do hold a few of them but like I've said in the past, this is a small market and no one really knows where it's headed.  So until I do, this is my model for managing risk while being able to focus on my next move.

pirateat40
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May 24, 2012, 02:33:15 AM
 #156


So you don’t really believe Bitcoin will be successful (or at least you don’t know if it will) so you’re not going to risk any of your own money when you can risk the money of others.

No no, in the current scenario being discussed, pirateat40's not reneging on any promises.

The lenders *agreed* to be paid back in bitcoins.

So, yes, their btc are worthless, but that's part of their contract and their choice.


Ok, I think I got it. So if the whole thing falls apart tomorrow no one will really care because the premise was never expected to last or return profit for anyone except pirate. I guess that's ok then. Everyone’s eyes are open.

Ummm, what?

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May 24, 2012, 02:34:45 AM
 #157

My point is very simple. When some company pays "investors" 10% per week when capital could be obtained otherwise at 2-50% per annum, no matter whether it is listed on NASDAQ or GLBSE or elsewhere, there are only two possibilities:

1. The issuer is acting irrationally.
2. The issuer is offloading to "investors" some enormous risks. As such these are not really "investors", but simply gamblers. And they should be really not so much concerned about return on capital as about return of capital.





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May 24, 2012, 02:36:03 AM
 #158

CBH: What.

He believes in Bitcoin, but not enough to risk hundreds of thousands of USD on it.  Are you really going to question that decision?

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May 24, 2012, 02:36:47 AM
 #159

Could you clarify please. What would be an example of an operation where having USD liabilites as opposed BTC liabilities is by 2-3 orders of magnitude more risky?




Ok lets say your business was in "pet rocks".  Now, there's a demand for them from an active but relatively small community (like Bitcoin) that believe these rocks are worth their weight in gold.  So you run to your bank and withdraw everything you can, hell you might even ask the banker for a loan.  You tell him it's for some home remodeling and because he's known you since grade school you get the loan.  With money in hand you run to the rock market and spend everything you got on certified "Pet Rocks". 

You get your business off the ground while paying off the loan but in the back of your mind you can't shake the thought of "What happens if people find out these are just rocks or if the rock market is overtaken by nano pets?".  You take the risk and keep building your business by reinvesting your profits back into buying more rocks.

You wake up one morning, roll over and look at your phone to see the current price of "pet rocks" to be worthless.  With a ill feeling creeping over your body you start to think about how many rocks you have in the warehouse and how much money you've actually creamed off the top.

Why didn't I just borrow the rocks from the rock community and pay them a portion of my profits?  That way if something was to happen, I made good money doing it and my long time friend (the banker) still likes me.

I don't know about you but that's what risk management means to me. Smiley



So you don’t really believe Bitcoin will be successful (or at least you don’t know if it will) so you’re not going to risk any of your own money when you can risk the money of others. In the mean time you can milk the cow dry and make money for as long as it lasts with limited personal risk. That’s perfectly rational and a very sound personal risk management strategy.


Does the guy paying for Corn or Pork Bellies believe they will be successful? He hopes so, but is aware Soy Beans might displace the Corn. So he doesn't put the bank on Corn and mitigates risks.

Corporations have been enthroned, An era of corruption in high places will follow and the money power will endeavor to prolong its reign by working on the prejudices of the people until wealth is aggregated in a few hands and the Republic is destroyed. ~Abe Lincoln 1ApJdWUdSWYw8n8HEATYhHXA9EYoRTy7c4
pirateat40
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May 24, 2012, 02:39:11 AM
 #160

My point is very simple. When some company that pays "investors" 10% per week, no matter whether it is listed on NASDAQ or GLBSE or elsewhere, there are only two possibilities:

1. The issuer is acting irrationally.
2. The issuer is offloading to "investors" some enormous risks. As such these are not really "investors", but simply gamblers. And they should be really not so much concerned about return on capital as about return of capital.






What exactly do you think you are doing right now with holding bitcoins?  If no one wants them, you get no money for them.

I'm not paying interesting interest (see I'm just tired) in fiat, it's in Bitcoins.  My lenders do whatever they want with the profits I pay out.

Maybe I'm just tired, but this is the kind of stuff that makes me stop posting in the forums.

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