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Why Bitcoin Boomed During the Government Shutdown
Daniel_Stuckey writes "Just two weeks after the Feds shuttered the Silk Road, the notorious online drug bazaar, Bitcoin prices have touched a five-month high — with a single Bitcoin fetching nearly $156 on Tokyo-based exchange Mt. Gox. Bitcoin's resiliency can no longer be denied, especially as the digital currency continued its ascendancy even against the backdrop of a U.S. government in utter disarray. At the 11th hour of the crisis, President Obama signed a bill that ended the partial government shutdown and, more importantly, raised the debt ceiling, an arbitrary limit on the amount of money the country can borrow that would have been surpassed today. If Congress had failed to reach a deal and the U.S. was unable to pay its bills, the results might have been catastrophic, eclipsing the bankruptcy of Lehman Brothers five years ago, the domino that could trigger the worst financial crisis since the Great Depression."
How many people honestly understand the relationship between currency prices and the government shutdown? Very very few I would guess.
Gold dropped when the goverment was down and bounced back after the deal was signed. Why? Gold is supposed to be a safe harbour.
Does the author of TFA see BTC as the opposite of gold, or does he see BTC as filling the same kind of role as gold?
Or is this simply a case of making using hindsight to construct an argument that fits a general argument that BTC is worth investing in?
No, you are the liar. The agencies that downgraded the US debt (and it is JUNK today, anybody who doesn't understand it has his or her head up their own asshole) were sued by the US gov't.
Of-course they were supposed to downgrade it to junk, the only agency that really downgraded the US bonds (Egan Jones) was stripped of their license to rate US debt. The sequester (cut to the spending) was the condition, the promise, under which the US gov't wouldn't be downgraded further (and eventually the worthless 'rating' agencies brought the US debt rating up again after getting scared of the feds and the SEC, etc.).
The Chinese don't want the US debt to grow, they just don't want the threat of not being paid what they are owed, so that's nonsense and that's why Chinese rating agencies downgraded US debt now, after the so called 'ceiling' was raised again.
The real crisis in USA is the debt, not the fake ceiling. The ceiling would have actually put a lid on ability of USA to continue running this enormous, biggest in history of the world ponzi scam, made up of the US bonds, dollars (the SS and Medicare are second in size ponzi scams after the bonds and the dollars).
USA is bankrupt, it can't pay its debts.
USA did NOT have to default on its creditors, 2300BILLION USD are collected per year by the feds, less than 300BILLION USD need to be paid out as the interest.
Obama, other politicians, the MSM all came out and told the bond holders: you are the low men on the totem pole, we won't pay you if we can't borrow more from you even though we collect almost 10 times the money in taxes that we need to pay you.
Anybody in their sane mind would see this as a direct threat against their assets (US bonds or dollars) if they have any and would immediately start unloading, but then again, this was obvious for a couple of decades now what is going on, specifically after the real default in 1971, when Nixon defaulted on the gold dollar.
The real story of-course is that USA is bankrupt, US bonds are junk, USA will never pay any of its debts and would rather cause massive inflation (maybe even hyper inflation) and the credit agencies are bought and paid for not to report that truth.
GS came out with a recommendation to dump the gold to its muppets^C^C^C^C^C 'investors'. Somebody was dumping large quantities of gold on the market of a few days straight, in an attempt to move the price down, most likely trying to weed out the weak hands so that they could buy much more back at lower prices.
Anyway, enjoy your Marxist/Keynesian ideology, certainly the only thing it will bring you will be a total economic and societal collapse, maybe that's your cup of tea of-course but you desire it so much, you should get to experience it.
You can't handle the truth.
If people stop mining, then the currency stops being created... no matter - that will happen eventually anyway.. More likely, the price of bitcoins will continue to rise as usage does, and this will drive more people to mine. If usage does not increase, then who cares if they are mined or not?
W..w..W - Willy Waterloo washes Warren Wiggins who is washing Waldo Woo.
Do you mean those that used to use dollars? So what changes? They are still oligarchs, drug dealers etc. but they are not using dollars and all those dollars go home and cause inflation upon their arrival. So this is about the US government not making as much from drug dealings?
Right. China has tight exchange controls - it take special permission from the State Ministry for Foreign Exchange to exchange yuan for dollars, euros, or yen. But at present, China residents can buy Bitcoins with yuan. They can also sell Bitcoins for dollars, bypassing exchange controls. So if you've made money in China and want, say, to buy an apartment in London, Bitcoin provides a way to bypass the government exchange controls.
That seems to be what's pushing up the price of Bitcoin. The volume on exchanges in China is way up, while volume at Mt.Gox is way down.
However, there's no guarantee that this situation will last. The People's Bank of China can change this policy at any time. There's plenty of info available about PBOC policy; it's as least as important as US Fed policy. But that's enough for Slashdot readers.
that i may abandon all trade the US Federal Reserve Notes and do all my buying & selling in BitCoin,
fuck the govt, they are a bunch of mooching criminals, and i dont approve of what they spend the tax revenue they collect,
Politics is Treachery, Religion is Brainwashing