I agree, but note that this is true of all currencies, fiat, gold (when it was one), seashells, private scrip, etc. So bitcoin is no different.
That is, the larger the economy of that currency, the greater the incentive to create (or steal) units of that currency directly, rather than produce something of value and trade for the currency. Thus, as the economy gets larger, more and more resources (both in human labor and energy) are spent getting money this way. All currencies will thus tend to have this kind of economic drag on them.
With gold, a fraction of output is devoted to mining more gold to use as money.
With paper fiat currencies, a fraction of output is devoted to couterfeiting or stealing the notes (including, of course, the arms race of countermeasures to stop this -- do you think the armored trucks and guards are free?)
Scrip currencies are usually too small for counterfeiting to get off the ground, but they must expend a token effort to make sure you can't just photocopy them.
And for bitcoin, a portion of the economy will be devoted to mining more coins and collecting transaction fees.
So it's true that Bitcoin comes coupled with a large overhead of energy spent on mining (or trojans to steal private keys), and it must continue to grow in order for a block chain solution to provide any kind of proof that a large fraction of existing mining capability was spent on it.
Just don't think other bigtime currencies are somehow more green.
And if not spending were indicative of economic strength, then nations where everyone lives in caves and there is no industry would be among the strongest in the world, because everyone's money would just sit in the bank.
That would still be better than forcing people to buy shit they don't want under threat of their savings evaporating, which is essentially what you're arguing for when you say "inflation encourages spending and that's good!".
Seriously, "no trade" is still better than "trade you only conducted because your savings would otherwise be raided".
Spending is not good, folks. Rather, good spending is good. Spending that leaves both parties better off is good. Spending that only happens under thread of being jacked of your stuff is *not* good -- its a wholly different species, and not something that should be casually equated with the spending that happens when people buy stuff they genuinely want to consume.
Collateral or not, short-term or not, a loan at 1% APR (or whatever obscenely below-market rate they charged) is pretty fucking sweet, and the fact that the Fed doesn't extend this offer to everyone, but only the "important people" should tell you something. If nothing else, the difference between the market cost of such a loan, and the price the Fed charged, is the magnitude of the subsidy.
Which means that all of these firms did, in fact, get a free handout just for being "special".
Considering that "going off the gold standard" in that time period is just a roundabout way of saying, "stealing the gold people were entitled to as currency holders", I think you need to show a little more than (very temporarily) puffed up economic activity to show that it was a good idea.
In most shitty economies, you can goose the economic numbers for a few years if you loot the rich and spend the proceeds on cool stuff. (See: History of every Banana Republic.) That doesn't somehow prove that looting the rich is a good idea.
Yes, and grocery stores provide something of value too. That doesn't mean bailing out ones that make fucktarded decisions is a good idea; we can settle for the non-fucktarded ones.
Thanks for playing, now go back to believing in whatever crisis the government is pimping today.
Help me out here: how do you rob a restaurant, tie someone up, and disembowel them, all toward the same end... without "making decisions"? Is that all something you can do just by instinct, without thought, without some level of recognition of links between means and ends, you just kind "go with the flow"?
I'm _not_ saying the death penalty was appropriate here. I'm just trying to reconcile the facts of the case with the claim that someone "doesn't make decisions", even though their actions only make sense in the context of goal-seeking.
If the defendant was that incapable, how did he even know the knife would cut? Or that a knife would be useful in the crime? Or that rope can prevent someone's movement?
Good point, that's how Batman is able help win legit convictions: he's not acting on authorization of the police, so when he leaves the criminals at the crime scene bundled up with the evidence, Gotham City can use all they found in court.
It's not like Slashdot ever posts anything remotely approaching actual news or something with a factual grounding, so what difference does it make if the homepage redirects to the actual Slashdot homepage or to Digg? Neither is actually news.
Um, Dutch and German are *much* closer that German and English. If you know German and try to read Dutch, you'll recognize almost all of it and think, "hey, this is German pronounced funny!"
And you'd be an idiot to stay on topic and reply to the actual arguments I made, because every refutation you attempt ends up to be fundamentally wrong.
Which, I guess, is why you changed topics... again.
You're really going to ground your entire criticism on whether I personally have cashed out? It's not like I have enough to really move the market or anything, so it's not some kind of invalidation of the profitability of this endeavor.
Keep in mind, nothing in this was certain: when I figured it all out, I was shocked that something like this could work, and figured I must be missing something (I've certainly screwed up on amateur entrepreneurism before...). So there was definitely risk -- it wasn't free in that sense.
Excuse me, I just pre-empted that extremely predictable reply by pointing out that the differences you can list are not relevant to the issues you just grounded your criticism on. (You might as well argue that Bitcoin must not be viable because it has a different name from Exxon or the Euro.)
Investing in a company via the stock market has exactly the same problems you just criticized Bitcoin for having! The fact that one or the other is "backed" by "real" this or "real" that, or pays "dividends" is completely irrelevant, in light of the fact that *both* can collapse to zero value. Exxon's ownership of a glass building means jack shit to you as a shareholder if their liabilities one day exceed their assets.
Certainly, Bitcoins are valued for different reasons than stocks, but what's important is that there *is* a reason: specifically, the ability to conduct near-anonymous, free, global, quick transactions with a unit whose supply is extremely predictable and can't be arbitrarily manipulated. So valuing them as if they were a company is going about it the wrong way -- like complaining about a toaster because it doesn't keep your food cold.
But I'm glad you at least admit that your criticism is ultimately coupled to rejection of a major part of capitalism, rather than some novel insight about some problem specific to Bitcoin.
... and bitcoin is also linked to the sum of goods and services in the (enclaves of) countries using that currency. By buying a haircut with bitcoins, you help shore up the value of bitcoins in everyone's wallet files.
The Euro is only backed up by speculation value. There is no relation to Gross Bitcoin Product, because there is no B or P. (???)
Seriously, do you have any understanding of the things you just tried to talk about? Because it sounds like you're just parroting soundbites.
No, the database just tells what address has how much, when. If you do a transaction with someone, all you can look up is how much that address currently has. Since anyone can have any number of addresses, all that does is give you a lower bound on their holdings... which becomes useless the moment that address is emptied and the bitcoins transferred to other addresses, which may or may not be owned (i.e private key known) by the same person.
You can do more sophisticated strategies, like tracing the paths of known addresses, but it's not like what you've described, and any such technique is quickly dulled by the ability to shuffle into new addresses, as well as the use of "bitlaundry" services that cycle coins through different holders and otherwise leave you with dead-end addresses.
It is designed for rewarding early investors. It even has a built-in diminishing return per investment.
Wow, just like stocks!
- The value of bitcoins can only increase as long as there is an influx of new investors who are willing to purchase them.
Wow, just like stocks!
- You're encouraged to find new investors in order to drive up the value of your (meager) holdings (and the substantial holdings of early players).
Wow, just like stocks!
- Once it bursts, there will be little to no value to recover, because there are no real assets reflecting the investments.
Wow, just like stocks whose issuers go bankrupt!
If it makes you happy to play this game, by all means go ahead, but do yourself a favour and don't invest more than you can comfortably afford to lose.
Wow, just like stocks!
I'm as nerdy and liberal as they come
Ah, that's why you don't like stocks. Those evil pyramid schemes that just enrich the folks that got in on the ground floor, require sustained interest to gain value, motivate their holders to promote them, and leave you with nothing if it all goes bust.
(Don't bother listing the differences between stocks and bitcoins -- yes, they exist, but the two are not different *with respect to the issues you just grounded your argument on*.)
I've already made more than the machine/electricity costs -- and keep in mind I can still use it as a gaming rig -- or sell it, and increase my profit.
Believe it or not, there *is* free money lying around in this world -- it's how entrepreneurs exist in the first place. Do you avoid picking up $20 bills on the ground, thinking that, "There is no free money lying around!"?
Sometimes opportunities stare us all in the face, waiting for someone to say, "oh shit, I can actually do this". I could have waited weeks to set up and the market *still* wouldn't have yet saturated.
Using the Phoenix miner with optimum settings and overclock, perhaps? (I get 380 MHash/s on 5870s and made a rig with 4 on one motherboard... yeah you're damn right I had to set up liquid cooling...)
I thought the same way, back in the good ol' days (March of this year...). I figured that the increase in difficulty would kill my profits, but a while later it turned out that the dollar price of bitcoins increased right in step with the difficulty so that the dollar return each day stayed roughly constant. (On 1.6 GHash/s, it hovered around $40/day despite huge increases in difficulty.) This persisted until about a few weeks ago, when it seemed to stick around $14/BTC.
I agree that it's less certain that this relationship will hold in the future, as more professional, optimized mining farms come online, but you're right that there's significant danger in assuming a constant difficulty or BTC value. But then, the risk goes both ways -- if bitcoins catch their "big break" and make it mainstream, the value can go up (again) faster than the difficulty.
So, if you're in it for the money, just be aware of how highly speculative this is. Don't pull a Rick Falkvinge and put all your savings in bitcoins, that's for damn sure.
And before that, the last article was two weeks previous.
Seriously, people are exaggerating how often we get a bitcoin story. Yes, for a short period we got them near daily, but now they're a lot more infrequent.
Slashdot Mirror
I agree, but note that this is true of all currencies, fiat, gold (when it was one), seashells, private scrip, etc. So bitcoin is no different.
That is, the larger the economy of that currency, the greater the incentive to create (or steal) units of that currency directly, rather than produce something of value and trade for the currency. Thus, as the economy gets larger, more and more resources (both in human labor and energy) are spent getting money this way. All currencies will thus tend to have this kind of economic drag on them.
With gold, a fraction of output is devoted to mining more gold to use as money.
With paper fiat currencies, a fraction of output is devoted to couterfeiting or stealing the notes (including, of course, the arms race of countermeasures to stop this -- do you think the armored trucks and guards are free?)
Scrip currencies are usually too small for counterfeiting to get off the ground, but they must expend a token effort to make sure you can't just photocopy them.
And for bitcoin, a portion of the economy will be devoted to mining more coins and collecting transaction fees.
So it's true that Bitcoin comes coupled with a large overhead of energy spent on mining (or trojans to steal private keys), and it must continue to grow in order for a block chain solution to provide any kind of proof that a large fraction of existing mining capability was spent on it.
Just don't think other bigtime currencies are somehow more green.
And if not spending were indicative of economic strength, then nations where everyone lives in caves and there is no industry would be among the strongest in the world, because everyone's money would just sit in the bank.
That would still be better than forcing people to buy shit they don't want under threat of their savings evaporating, which is essentially what you're arguing for when you say "inflation encourages spending and that's good!".
Seriously, "no trade" is still better than "trade you only conducted because your savings would otherwise be raided".
Spending is not good, folks. Rather, good spending is good. Spending that leaves both parties better off is good. Spending that only happens under thread of being jacked of your stuff is *not* good -- its a wholly different species, and not something that should be casually equated with the spending that happens when people buy stuff they genuinely want to consume.
Collateral or not, short-term or not, a loan at 1% APR (or whatever obscenely below-market rate they charged) is pretty fucking sweet, and the fact that the Fed doesn't extend this offer to everyone, but only the "important people" should tell you something. If nothing else, the difference between the market cost of such a loan, and the price the Fed charged, is the magnitude of the subsidy.
Which means that all of these firms did, in fact, get a free handout just for being "special".
Considering that "going off the gold standard" in that time period is just a roundabout way of saying, "stealing the gold people were entitled to as currency holders", I think you need to show a little more than (very temporarily) puffed up economic activity to show that it was a good idea.
In most shitty economies, you can goose the economic numbers for a few years if you loot the rich and spend the proceeds on cool stuff. (See: History of every Banana Republic.) That doesn't somehow prove that looting the rich is a good idea.
Yes, and grocery stores provide something of value too. That doesn't mean bailing out ones that make fucktarded decisions is a good idea; we can settle for the non-fucktarded ones.
Thanks for playing, now go back to believing in whatever crisis the government is pimping today.
Help me out here: how do you rob a restaurant, tie someone up, and disembowel them, all toward the same end ... without "making decisions"? Is that all something you can do just by instinct, without thought, without some level of recognition of links between means and ends, you just kind "go with the flow"?
I'm _not_ saying the death penalty was appropriate here. I'm just trying to reconcile the facts of the case with the claim that someone "doesn't make decisions", even though their actions only make sense in the context of goal-seeking.
If the defendant was that incapable, how did he even know the knife would cut? Or that a knife would be useful in the crime? Or that rope can prevent someone's movement?
Good point, that's how Batman is able help win legit convictions: he's not acting on authorization of the police, so when he leaves the criminals at the crime scene bundled up with the evidence, Gotham City can use all they found in court.
I mean, if all that happened in real life.
It's not like Slashdot ever posts anything remotely approaching actual news or something with a factual grounding, so what difference does it make if the homepage redirects to the actual Slashdot homepage or to Digg? Neither is actually news.
Um, Dutch and German are *much* closer that German and English. If you know German and try to read Dutch, you'll recognize almost all of it and think, "hey, this is German pronounced funny!"
The database is null-key encrypted.
So it's not encrypted?
And you'd be an idiot to spend bitcoins.
And you'd be an idiot to stay on topic and reply to the actual arguments I made, because every refutation you attempt ends up to be fundamentally wrong.
Which, I guess, is why you changed topics ... again.
Why not, and what did I? I've made a profit. Sorry.
You're really going to ground your entire criticism on whether I personally have cashed out? It's not like I have enough to really move the market or anything, so it's not some kind of invalidation of the profitability of this endeavor.
Keep in mind, nothing in this was certain: when I figured it all out, I was shocked that something like this could work, and figured I must be missing something (I've certainly screwed up on amateur entrepreneurism before...). So there was definitely risk -- it wasn't free in that sense.
Excuse me, I just pre-empted that extremely predictable reply by pointing out that the differences you can list are not relevant to the issues you just grounded your criticism on. (You might as well argue that Bitcoin must not be viable because it has a different name from Exxon or the Euro.)
Investing in a company via the stock market has exactly the same problems you just criticized Bitcoin for having! The fact that one or the other is "backed" by "real" this or "real" that, or pays "dividends" is completely irrelevant, in light of the fact that *both* can collapse to zero value. Exxon's ownership of a glass building means jack shit to you as a shareholder if their liabilities one day exceed their assets.
Certainly, Bitcoins are valued for different reasons than stocks, but what's important is that there *is* a reason: specifically, the ability to conduct near-anonymous, free, global, quick transactions with a unit whose supply is extremely predictable and can't be arbitrarily manipulated. So valuing them as if they were a company is going about it the wrong way -- like complaining about a toaster because it doesn't keep your food cold.
But I'm glad you at least admit that your criticism is ultimately coupled to rejection of a major part of capitalism, rather than some novel insight about some problem specific to Bitcoin.
... and bitcoin is also linked to the sum of goods and services in the (enclaves of) countries using that currency. By buying a haircut with bitcoins, you help shore up the value of bitcoins in everyone's wallet files.
The Euro is only backed up by speculation value. There is no relation to Gross Bitcoin Product, because there is no B or P. (???)
Seriously, do you have any understanding of the things you just tried to talk about? Because it sounds like you're just parroting soundbites.
No, the database just tells what address has how much, when. If you do a transaction with someone, all you can look up is how much that address currently has. Since anyone can have any number of addresses, all that does is give you a lower bound on their holdings ... which becomes useless the moment that address is emptied and the bitcoins transferred to other addresses, which may or may not be owned (i.e private key known) by the same person.
You can do more sophisticated strategies, like tracing the paths of known addresses, but it's not like what you've described, and any such technique is quickly dulled by the ability to shuffle into new addresses, as well as the use of "bitlaundry" services that cycle coins through different holders and otherwise leave you with dead-end addresses.
It is designed for rewarding early investors. It even has a built-in diminishing return per investment.
Wow, just like stocks!
- The value of bitcoins can only increase as long as there is an influx of new investors who are willing to purchase them.
Wow, just like stocks!
- You're encouraged to find new investors in order to drive up the value of your (meager) holdings (and the substantial holdings of early players).
Wow, just like stocks!
- Once it bursts, there will be little to no value to recover, because there are no real assets reflecting the investments.
Wow, just like stocks whose issuers go bankrupt!
If it makes you happy to play this game, by all means go ahead, but do yourself a favour and don't invest more than you can comfortably afford to lose.
Wow, just like stocks!
I'm as nerdy and liberal as they come
Ah, that's why you don't like stocks. Those evil pyramid schemes that just enrich the folks that got in on the ground floor, require sustained interest to gain value, motivate their holders to promote them, and leave you with nothing if it all goes bust.
(Don't bother listing the differences between stocks and bitcoins -- yes, they exist, but the two are not different *with respect to the issues you just grounded your argument on*.)
I've already made more than the machine/electricity costs -- and keep in mind I can still use it as a gaming rig -- or sell it, and increase my profit.
Believe it or not, there *is* free money lying around in this world -- it's how entrepreneurs exist in the first place. Do you avoid picking up $20 bills on the ground, thinking that, "There is no free money lying around!"?
Sometimes opportunities stare us all in the face, waiting for someone to say, "oh shit, I can actually do this". I could have waited weeks to set up and the market *still* wouldn't have yet saturated.
Is that supposed to be funny, like you're own little stand-up comedy routine we're supposed to nod our drone heads and laugh at?
Using the Phoenix miner with optimum settings and overclock, perhaps? (I get 380 MHash/s on 5870s and made a rig with 4 on one motherboard ... yeah you're damn right I had to set up liquid cooling...)
I thought the same way, back in the good ol' days (March of this year...). I figured that the increase in difficulty would kill my profits, but a while later it turned out that the dollar price of bitcoins increased right in step with the difficulty so that the dollar return each day stayed roughly constant. (On 1.6 GHash/s, it hovered around $40/day despite huge increases in difficulty.) This persisted until about a few weeks ago, when it seemed to stick around $14/BTC.
I agree that it's less certain that this relationship will hold in the future, as more professional, optimized mining farms come online, but you're right that there's significant danger in assuming a constant difficulty or BTC value. But then, the risk goes both ways -- if bitcoins catch their "big break" and make it mainstream, the value can go up (again) faster than the difficulty.
So, if you're in it for the money, just be aware of how highly speculative this is. Don't pull a Rick Falkvinge and put all your savings in bitcoins, that's for damn sure.
And before that, the last article was two weeks previous.
Seriously, people are exaggerating how often we get a bitcoin story. Yes, for a short period we got them near daily, but now they're a lot more infrequent.
Look, dude, it's enough that people confuse "gecko" and "Geico". Now you want to make it even harder by mixing in "Gieco" and "Giecko"???
Hm, how do they enforce the provisions about how George III sent soldiers to eat out their substance? How would you even break that law???
But ... I like hearing about solar vaporware every other week :-(