It feels like you are off topic here. We were talking about taxable transactions here – something that would trigger you to pay a tax. Being digital is kind of a side issue.
If you sold something – be it vegetables, BitCoins, or computer code – that would be a taxable event. If you exchanged something – like BitCoins for output of your computer code – that would be a taxable event.
But building a cool piece of code or painting a cool piece of art is not – unless I am missing something here,.
There are some countries, such as France, that have a wealth tax. So yes, in some places, you have to pay a tax each year you hold BitCoins, Apple, or whatever. (fun fact, a wealth tax has one of the highest tax drags for taxes for long term investments.)
I'll go along with it if I can PAY my taxes in bitcoin...Until then @!#$@#$ off.
Why? I don’t know about Canada, but in most of the world, if you make profits in a foreign currency (or script, barter, etr.) it is your responsibility to convert those profits to US Dollars. Why should BitCoins be different?
As given in the summary, it is sales tax (if used to buy things) or capital gains tax (if mined and sold, or speculated in.) Which, I think, would be common sense. In America, at least, you can’t avoid taxes by switching to barter, script, or other currencies – it’s fair market value that drives the underlying tax code.
Now, take a look at Palmer. She does social media well, and her kickstater campaign was done right. But she makes her money by touring, and that scales in a very particular way. Take a look a Ani DiFranco or Jonathan Coulton, 2 other artist I really like and are independent. They are quirky, passionate about specific things – because they are pandering (which is slightly too strong of a word), and light.
And by light I don't mean fluffy, I mean they tour with just a few people, because they can't afford to drag a large backing band around with the. Sometimes I long for a nice big brass section. Or, for that matter, a large multimillion dollar movie with a large backing band of special effects artists.
So, go back to my original post. I don't like DRM and I think our current IP laws are too strict. Loosening the IP laws would be straightforward.. But for DRM – I am not sure what the right answer there is.
Well, I did say it was more complex then that – but let's look at your example.
We have patronage today. Go to any symphony, opera, modern dance, etc. and open up the program. You will see a lot of money was given by a lot of blue haired ladies, brokerage firms, and Swiss watch companies.
The more that the arts rely on patronage, the more power these folks will have.
What source are you using? Everything that I have seen / read points in the opposit direction.
And I thought we were talking about CDs, but if you want to talk about film....
If “highest gross year” you mean selling tickets to the theaters, then maybe. I think, after you adjust for inflation, maybe. In terms of seats sold, no – those have been falling. (which is offset by selling higher priced seats to IMAX 3D stuff.) .
If you are talking about profit, then no. They used to make a ton of money from selling DVDs. That market is going though the floor.
But that is slightly off base. Selling a physical seat in a movie theater and linking that to DRM is weak. You are trying to compare the movie experience with a home theater – it can be made but it is different., so I don't think you point is exactly on.
I would think DVD viewings would be a better match – expect we don't know those. People used to buy, now they stream, use Netflix, Redbox, etc.
Let's compare different countries with different laws and attitudes towards file sharing. South Korea, Germany, Spain, America. The loser the laws, the more filing sharing there is, the faster the drop is.
Let's compare people of different ages in Germany and Briton. People over 30+, who tend to have more respect for DRM and do less file sharing, buy more CDs. Younger people less so. And it is probably not an age thing. Young people never got into the habit of buying overpriced CDs never do.
Lets see, over the past 30 years we are seeing declining sales, declining profits, record companies going bankrupt, record companies merging for cost savings, more record companies going bankrupt, fewer albums that are being released, and fewer artists being launch.
Dead? No. Alive and health? No. Heck, for the above problems I don't even put the majority of the responsibility on piracy, but I do think it is a factor.
Could you answer the OP original question? And there is an argument that it is good for the consumers?.
No DRM means no income for the artist. No income for the artist, no new art. Consumer losses because there is no new art. This is the simply, strong, argument – the real world is a bit more nuanced, not so black and white – but suggestive. Countries / media that have a lot of unauthorized copying have lower output.
So, how do we compensate artist without DRM? And compensation does matter. I have seen both Peter Jackson’s The Hobbit and a 3 man 1 hour version of it. I liked both – and I want both to exist. Without DRM, how do we compensate Jackson? I am not happy with DRM – but I can’t figure out a better idea.
I would say maybe. The shows that Fox cancel tend to be cult shows. That is, a show with a few, deep, passionate fans. Advertisers tend to care more about how many people watch – they don’t care if the passion is a inch deep if it is a mile wide.
And on a side note, there are issues with customer feedback. Their good at identifying things that are wrong but are bad at identifying things that are good, so it is of limited use. When presented with something new, something that breaks the mold, feedback audiences always giver lower scores then to normal, comfortable stuff. Give them a few episodes and a little white to think – and often you get very different answers.
Why wonder? Under the Bush tax cuts (made permanent by Obama) tax rates on dividends were cut. See the QDI rules.
I am not sure why you think any of those would be true. I can’t think of any particular economy theory that would back any of those 3 positions. All I can think of is that the reduced tax rate would make investing more attractive and push up share prices.
No, mutual funds have trading expenses - because we are talking about the fund's trading costs - not yours. What do you think happens when you buy some shares of a mutual fund – that the portfolio manager sits on the cash you just sent in? No, they take your money and invest it – i.e. buy stuff with it – i.e. trade with it. And those trades are not free – trust me on that. Even if you sit and hold you position in a index mutual fund, other people will be buying into and selling out of that fund, forcing the manager to buy and sell stock.
Now, you are right that the portfolios manger’s trading expense is buried in the operating expense which includes a lot things, so you have to try to pick things apart using proxy values such as turn over ratios, have industry knowledge. Etc. For example, the general feeling for index funds is that the 2 biggest expenses are trading costs and licensing fees of the index. (A index fund has to claim that it is following an index, and whoever created that index tends to charge an arm and a leg to use their name.)
Let’s see, when France enacted their Tobin Tax, prices went down, liquidity went down, and volatility increased. And I have seen studies that argue the opposite.
I don’t think a Tobin Tax is the answer. It is often put forward by people who are suspicious of the chaotic energy of the market and of wealthy people – suspecting it is just a game of no real value. I would say that you were treating the symptoms and not the disease – expect that I am not even sure what the symptom or disease they are trying to cure.
Why not tackle the issue from the other end? For example, index long term capital gains to inflation. This would encourage investors to hold their positions for longer.
This is not what I have been told. I have been told that it makes the market more efficient by squeezing the bid/ask spread. This allows people to execute trades faster and cheaper than before. However, this comes at the price of increased volatility. (There is some proof of this – but trying to pull out the effect of HFT against all of the other factors is hard.)
Headline algorithms exist and make a lot of money. They only have to be right 51% of the time to work.
Mind you, most of the algorithms work off expected vs. actual earnings, revenue, or some other such number rather than the headlines. Of course, those numbers are released first and then humans write the headlines, but still
I will point out something to buy and hold investors
The Bid / Ask spread has dropped by 90% in the past 30 years. You used to pay.5% to 2% for each trade – not it basically nothing. Moving to decimalization helped, but it is the HFT that really collapsed the spread. This is even truer for ETFs then for normal stock.
The fees that mutual funds and ETFs (which a lot of buy and hold investors hold) have also collapsed the past 30 years. Specifically for index funds, they have fallen by 90%. There are a lot of reasons for this, but about a quarter to a third is lower trading costs, which can be traced backed to HFT.
So, you save about 1% to get into a investment, and about.25% each year if that investment is a mutual fund.
Lenovo is about as Chinness as Toyota is Japaneses - which means you millage will vary.
IIRC, Lenovo has it's headquarters and a good chunk of it's design team in America. I even think it has a assemble plant (not sure if it's open, being built, or just under consideration.).
Can you explain why BitCoin is a commodity? I have never thought of it as a commodity and I would like to hear your reasoning. I have always thought of it as a speculative assets aspiring to be a currency.
My gut tells me no - not the Zimbabwean dollar or the 1920 German Mark. (If you got some volatility numbers for BitCoin I would like to see them.)
And, more importantly, those currencies only headed a single direction – down – not zig zaggy up and down. Money has 3 purposes – exchange, store of value, and unit of account. For the last 2 there are tricks to handle money with you face high inflation – but fewer tricks when you don’t know which way the currency will zig next.
I blogged about it the other day, in how I wish governments would just make BTC to fiat currency transactions illegal. It would be a great step in reducing volatility and decoupling BTC from the regulated markets.
History shows you can’t stop it – There will be leakage - you can only make it inefficient. Look at the governments try to regulate the official exchange rate. They all have a grey / black market on the side trading US Dollars.
In your case? What would stop me from buying goods (IPods, Gold Coins, phone minutes, WOW Gold, etc.) in BitCoins and then reselling in dollars? Sure, I’d lose 10 to 30 percent of the value – but if the spread was high enough
Yes, I am sure. It is their bread and butter – what they do every day. It does not generate the headlines as banks burn to the ground but it is one of their central mandate. I was speaking broadly, so I don’t know what aspect you are specifically referring to, but inflation, interest rates, and FX rates are all linked to together. Affect the first 2 and you will affect the 3rd.
They run monetary policy, which outside supply shocks (such as the oil crisis of the 70s) has the greatest influence on inflation.
I would not consider their ability to set short term rates and regulate bank’s lending policies as “not influential”
We can debate the influence of central bankers. In most countries it is keeping the system running smoothly by moving slowly. Others, such as Hong Kong, employ currency boards to keep things stable. Take a look at what the Venezuela central banks and tell me that they are not influential. My point is, if BitCoin had a central bank (Which is antithetical to BitCoin), it’s central bankers would be working to dampen the volatility of BitCoin. They have tools that work. Not saying that they are the be all / end all – see George Soros beating down the Bank of England in 1992 – but they do have real power.
Not really. IIRC about 5% goes towards industrial use (CPUs and such).
The rest goes towards bullion or jewelry. In the past decade most of the gold jewelry has been sold to India and China for things like gold chains – which is sold by weight – no premium given for artistry. Both of those countries have a under developed banking / investment system, so I would trim the percentage going towards jewelry. And most gold is sitting in vaults as bullion. If released it would crush the market – so it is an artificial restriction in terms of useful industrial use.
Like fiat currency the only reason why gold has much in the way of value is that everybody values it. (It’s harder to debase then fiat currency which is a plus.)
“Dollars, euros and other fiat currencies” have central banks that can intervene and do try to manage the currency. When inflation / deflation spikes they can create / destroy currency, money, and near money. (Does this mean they can debase the currency, unlike BitCoin? Yes)
Gold, which I think is more like BitCoin, has the advantage of – for the lack of a better word – mass – that resists rapid changes. A wide user base, lots of the stuff gathering dust in vaults or grandma’s jewelry.
Both have deep forward and futures market they also lend long term stability. Maybe one day BitCoin will get there – but right now it is an interesting experiment in my opinion.
Slashdot Mirror
It feels like you are off topic here. We were talking about taxable transactions here – something that would trigger you to pay a tax. Being digital is kind of a side issue.
If you sold something – be it vegetables, BitCoins, or computer code – that would be a taxable event. If you exchanged something – like BitCoins for output of your computer code – that would be a taxable event.
But building a cool piece of code or painting a cool piece of art is not – unless I am missing something here,.
There are some countries, such as France, that have a wealth tax. So yes, in some places, you have to pay a tax each year you hold BitCoins, Apple, or whatever. (fun fact, a wealth tax has one of the highest tax drags for taxes for long term investments.)
I'll go along with it if I can PAY my taxes in bitcoin...Until then @!#$@#$ off.
Why? I don’t know about Canada, but in most of the world, if you make profits in a foreign currency (or script, barter, etr.) it is your responsibility to convert those profits to US Dollars. Why should BitCoins be different?
As given in the summary, it is sales tax (if used to buy things) or capital gains tax (if mined and sold, or speculated in.) Which, I think, would be common sense. In America, at least, you can’t avoid taxes by switching to barter, script, or other currencies – it’s fair market value that drives the underlying tax code.
Don't need to – I already saw it and I though it was a great talk. I like her music, but I am more of a fan of her husband.
Here is one that I like, Vegemite (The Black Death) : http://www.youtube.com/watch?v=RJhDV0MMPAs
Now, take a look at Palmer. She does social media well, and her kickstater campaign was done right. But she makes her money by touring, and that scales in a very particular way. Take a look a Ani DiFranco or Jonathan Coulton, 2 other artist I really like and are independent. They are quirky, passionate about specific things – because they are pandering (which is slightly too strong of a word), and light.
And by light I don't mean fluffy, I mean they tour with just a few people, because they can't afford to drag a large backing band around with the. Sometimes I long for a nice big brass section. Or, for that matter, a large multimillion dollar movie with a large backing band of special effects artists.
So, go back to my original post. I don't like DRM and I think our current IP laws are too strict. Loosening the IP laws would be straightforward.. But for DRM – I am not sure what the right answer there is.
Well, I did say it was more complex then that – but let's look at your example.
We have patronage today. Go to any symphony, opera, modern dance, etc. and open up the program. You will see a lot of money was given by a lot of blue haired ladies, brokerage firms, and Swiss watch companies.
The more that the arts rely on patronage, the more power these folks will have.
The music labels get more and more profit?
What source are you using? Everything that I have seen / read points in the opposit direction.
And I thought we were talking about CDs, but if you want to talk about film....
If “highest gross year” you mean selling tickets to the theaters, then maybe. I think, after you adjust for inflation, maybe. In terms of seats sold, no – those have been falling. (which is offset by selling higher priced seats to IMAX 3D stuff.) .
If you are talking about profit, then no. They used to make a ton of money from selling DVDs. That market is going though the floor.
But that is slightly off base. Selling a physical seat in a movie theater and linking that to DRM is weak. You are trying to compare the movie experience with a home theater – it can be made but it is different., so I don't think you point is exactly on.
I would think DVD viewings would be a better match – expect we don't know those. People used to buy, now they stream, use Netflix, Redbox, etc.
Hmmm, let's see.
Sales of CDs and music are falling world.
Let's compare different countries with different laws and attitudes towards file sharing. South Korea, Germany, Spain, America. The loser the laws, the more filing sharing there is, the faster the drop is.
Let's compare people of different ages in Germany and Briton. People over 30+, who tend to have more respect for DRM and do less file sharing, buy more CDs. Younger people less so. And it is probably not an age thing. Young people never got into the habit of buying overpriced CDs never do.
CDs are gong the way of buggy whips.
Dead?
Lets see, over the past 30 years we are seeing declining sales, declining profits, record companies going bankrupt, record companies merging for cost savings, more record companies going bankrupt, fewer albums that are being released, and fewer artists being launch.
Dead? No. Alive and health? No. Heck, for the above problems I don't even put the majority of the responsibility on piracy, but I do think it is a factor.
Could you answer the OP original question? And there is an argument that it is good for the consumers?.
No DRM means no income for the artist. No income for the artist, no new art. Consumer losses because there is no new art. This is the simply, strong, argument – the real world is a bit more nuanced, not so black and white – but suggestive. Countries / media that have a lot of unauthorized copying have lower output.
So, how do we compensate artist without DRM? And compensation does matter. I have seen both Peter Jackson’s The Hobbit and a 3 man 1 hour version of it. I liked both – and I want both to exist. Without DRM, how do we compensate Jackson? I am not happy with DRM – but I can’t figure out a better idea.
I would say maybe. The shows that Fox cancel tend to be cult shows. That is, a show with a few, deep, passionate fans. Advertisers tend to care more about how many people watch – they don’t care if the passion is a inch deep if it is a mile wide.
And on a side note, there are issues with customer feedback. Their good at identifying things that are wrong but are bad at identifying things that are good, so it is of limited use. When presented with something new, something that breaks the mold, feedback audiences always giver lower scores then to normal, comfortable stuff. Give them a few episodes and a little white to think – and often you get very different answers.
Why wonder? Under the Bush tax cuts (made permanent by Obama) tax rates on dividends were cut. See the QDI rules.
I am not sure why you think any of those would be true. I can’t think of any particular economy theory that would back any of those 3 positions. All I can think of is that the reduced tax rate would make investing more attractive and push up share prices.
No, mutual funds have trading expenses - because we are talking about the fund's trading costs - not yours. What do you think happens when you buy some shares of a mutual fund – that the portfolio manager sits on the cash you just sent in? No, they take your money and invest it – i.e. buy stuff with it – i.e. trade with it. And those trades are not free – trust me on that. Even if you sit and hold you position in a index mutual fund, other people will be buying into and selling out of that fund, forcing the manager to buy and sell stock.
Now, you are right that the portfolios manger’s trading expense is buried in the operating expense which includes a lot things, so you have to try to pick things apart using proxy values such as turn over ratios, have industry knowledge. Etc. For example, the general feeling for index funds is that the 2 biggest expenses are trading costs and licensing fees of the index. (A index fund has to claim that it is following an index, and whoever created that index tends to charge an arm and a leg to use their name.)
Let’s see, when France enacted their Tobin Tax, prices went down, liquidity went down, and volatility increased. And I have seen studies that argue the opposite.
I don’t think a Tobin Tax is the answer. It is often put forward by people who are suspicious of the chaotic energy of the market and of wealthy people – suspecting it is just a game of no real value. I would say that you were treating the symptoms and not the disease – expect that I am not even sure what the symptom or disease they are trying to cure.
Why not tackle the issue from the other end? For example, index long term capital gains to inflation. This would encourage investors to hold their positions for longer.
This is not what I have been told. I have been told that it makes the market more efficient by squeezing the bid/ask spread. This allows people to execute trades faster and cheaper than before. However, this comes at the price of increased volatility. (There is some proof of this – but trying to pull out the effect of HFT against all of the other factors is hard.)
Headline algorithms exist and make a lot of money. They only have to be right 51% of the time to work.
Mind you, most of the algorithms work off expected vs. actual earnings, revenue, or some other such number rather than the headlines. Of course, those numbers are released first and then humans write the headlines, but still
I will point out something to buy and hold investors
The Bid / Ask spread has dropped by 90% in the past 30 years. You used to pay .5% to 2% for each trade – not it basically nothing. Moving to decimalization helped, but it is the HFT that really collapsed the spread. This is even truer for ETFs then for normal stock.
The fees that mutual funds and ETFs (which a lot of buy and hold investors hold) have also collapsed the past 30 years. Specifically for index funds, they have fallen by 90%. There are a lot of reasons for this, but about a quarter to a third is lower trading costs, which can be traced backed to HFT.
So, you save about 1% to get into a investment, and about .25% each year if that investment is a mutual fund.
Lenovo is about as Chinness as Toyota is Japaneses - which means you millage will vary.
IIRC, Lenovo has it's headquarters and a good chunk of it's design team in America. I even think it has a assemble plant (not sure if it's open, being built, or just under consideration.).
Can you explain why BitCoin is a commodity? I have never thought of it as a commodity and I would like to hear your reasoning. I have always thought of it as a speculative assets aspiring to be a currency.
My gut tells me no - not the Zimbabwean dollar or the 1920 German Mark. (If you got some volatility numbers for BitCoin I would like to see them.)
And, more importantly, those currencies only headed a single direction – down – not zig zaggy up and down. Money has 3 purposes – exchange, store of value, and unit of account. For the last 2 there are tricks to handle money with you face high inflation – but fewer tricks when you don’t know which way the currency will zig next.
I blogged about it the other day, in how I wish governments would just make BTC to fiat currency transactions illegal. It would be a great step in reducing volatility and decoupling BTC from the regulated markets.
History shows you can’t stop it – There will be leakage - you can only make it inefficient. Look at the governments try to regulate the official exchange rate. They all have a grey / black market on the side trading US Dollars.
In your case? What would stop me from buying goods (IPods, Gold Coins, phone minutes, WOW Gold, etc.) in BitCoins and then reselling in dollars? Sure, I’d lose 10 to 30 percent of the value – but if the spread was high enough
Well, it is the definition of the current currency, so I don’t think it is prerogative.
As for whom? Those would be Democrats – either during Lincoln or Nixon’s presidency.
Yes, I am sure. It is their bread and butter – what they do every day. It does not generate the headlines as banks burn to the ground but it is one of their central mandate. I was speaking broadly, so I don’t know what aspect you are specifically referring to, but inflation, interest rates, and FX rates are all linked to together. Affect the first 2 and you will affect the 3rd.
They run monetary policy, which outside supply shocks (such as the oil crisis of the 70s) has the greatest influence on inflation.
I would not consider their ability to set short term rates and regulate bank’s lending policies as “not influential”
We can debate the influence of central bankers. In most countries it is keeping the system running smoothly by moving slowly. Others, such as Hong Kong, employ currency boards to keep things stable. Take a look at what the Venezuela central banks and tell me that they are not influential.
My point is, if BitCoin had a central bank (Which is antithetical to BitCoin), it’s central bankers would be working to dampen the volatility of BitCoin. They have tools that work. Not saying that they are the be all / end all – see George Soros beating down the Bank of England in 1992 – but they do have real power.
Gold is rare and useful.
Not really. IIRC about 5% goes towards industrial use (CPUs and such).
The rest goes towards bullion or jewelry. In the past decade most of the gold jewelry has been sold to India and China for things like gold chains – which is sold by weight – no premium given for artistry. Both of those countries have a under developed banking / investment system, so I would trim the percentage going towards jewelry. And most gold is sitting in vaults as bullion. If released it would crush the market – so it is an artificial restriction in terms of useful industrial use.
Like fiat currency the only reason why gold has much in the way of value is that everybody values it. (It’s harder to debase then fiat currency which is a plus.)
No they are not.
“Dollars, euros and other fiat currencies” have central banks that can intervene and do try to manage the currency. When inflation / deflation spikes they can create / destroy currency, money, and near money. (Does this mean they can debase the currency, unlike BitCoin? Yes)
Gold, which I think is more like BitCoin, has the advantage of – for the lack of a better word – mass – that resists rapid changes. A wide user base, lots of the stuff gathering dust in vaults or grandma’s jewelry.
Both have deep forward and futures market they also lend long term stability. Maybe one day BitCoin will get there – but right now it is an interesting experiment in my opinion.