They never explained why I should accept a backed coin whose value would be near zero in the case of a collapse of its monetary uses versus using bitcoin whose value goes to zero when there is a collapse in its monetary uses.

This is the crux of the arguments of those that claim bitcoin's value is zero because it has no intrinsic value. Ya if no one values an object then it's value is zero, but while people use it its value is the market price. Bitcoin is not inherently worthless nor is it inherently valuable. Nothing has inherent value and their definition of intrinsic value is simply an assumption that demand for physical uses is more valuable than demand for informational uses.

That's their subjective opinion, and they can use whatever backed currency they want. But if enough people want to use a backless currency like bitcoin then bitcoin has value and that value could stay stable over a long period of time.

I didn't think they were arguing what should happen, just what probably would happen. (Admittedly, I could have missed something) I agree that intrinsic value is a slippery concept. I think gold has value because it best satisfies the properties people desire in a store of value, not because people like gold earrings.

We've discussed on here before how we had 4%+ GDP growth during a century of the gold standard, and 3% growth in our century with the Fed, and how people today are still willing to sacrifice growth for price stability, and I think it's probably true. I think history has shown that people want safety and guarantees of stability from government.

I have not been able to find an example of monetary deflation that wasn't a disaster. Even during the gold standard we had a point or two of supply inflation. I don't think that a truly deflationary currency can ever be stable or function as well as what we're accustomed to in a society as large and complex as ours.

A deflationary currency is near impossible. That means the government would be collecting taxes and destroying them and the fed would not be printing. There was a lot more gold in 1900 than 1800.

https://bitcointalk.org/index.php?topic=375010.0

Remember Keynes-ism is not economics, it is a crime.

Yes, but there have been contractions in money supply in different countries over the years, and it's always been bad.

Somewhere in Pakistan or wherever there's a guy without any legs who recently watched his family get blown to pieces who knows you're full of ****.

lol what?

I'm not even sure what you're trying to say here.

One thing I'm saying is that inflationary currencies aren't making everybody's economy stable.

Money printing has often been used to temporarily boost war efforts, but I'm not sure that's going to convince the global masses to accept a deflationary currency or change the fact that economies have historically done poorly when the supply of money shrinks. Violence has been around forever. Perhaps you might believe that any reduction in violence is always worth a sacrifice in economic wellbeing, but I'm not sure I'd agree with it or most others would either.

Just to nitpick, violence almost by definition reduces net economic wellbeing.

To be clear, that's a different discussion than whether specific instances of violence are worth instigating under a given circumstances, if you can rely on others around you not initiating violence themselves, or whether violence may benefit one party at the expense of another.

I don't think you were born into a reality where not being violent causes you to be worse off, like there's some sick catch-22 from the gods. Maybe I rely too much on basic intuition and haven't read enough boring economic textbooks, I don't know. (Again, the guy in Pakistan who had his village blown up doesn't feel economically prosperous. You're just looking at one end of it, and ignoring the long-term consequences to boot.)

No, you're conflating war with monetary policy. You can be anti-war, opposed to violence, and still prefer a Friedmanesque 2-3% inflation because it functions better. A 3% inflation does not necessarily mean that more money has to be spent killing people.

Inflating during wartime may temporarily help to fuel violence, it's true. But without technology, none of this would be happening either. Are you opposed to technology? Do you want to destroy all of the capital in the world and take us back to the stone age to reduce violence? How far are you willing to go?

Every depression of the 1800s and the great depression were caused by fractional reserve lending (mostly lending involving real estate). All depressions can easily be cured by full reserve banking and money supply not controlled by governments or central banks. The government is not responsible to be involved in private housing.

On the contrary: Mick and Majormax seemed to understand your misconceptions quite well, and they explained things in a very clear way. There wasn't anything left in your argument by the time I got to last Majormax post that I read.

Not sure what you mean, since mainstream macroeconomists have no problems communicating with each other. (By the way, Nick is an academic economist -- you can see it in his pedagogical style -- but my guess is that majormax isn't, he is just an interested amateur.) You're reading your confusion in understanding their points into your interpretation of the discussion.

Now, of course there is debate about macroeconomic ideas. There are also debates about the mechanisms underlying high-temperature superconductivity. Does that mean condensed matter physicists have no authority to speak to you about the topic?

This right here was quite amazing. I mean, there were attempts to explain the basic ideas to you in that thread that went completely over your head, and your inference is that "it's not like the topic is that complicated".

The interested viewer may, of course, refer to the post that TimM is now trying to disavow, as well as my response:

http://forumserver.twoplustwo.com/sh...ostcount=11443

http://forumserver.twoplustwo.com/sh...ostcount=11445

In particular, TimM writes: "If something cannot be made profitably, including accounting for risk, it should not be built, even by the government." I don't see how this sentence can be interpreted in any way charitable to TimM -- unless, by utter coincidence, he screwed up his sentence (and his entire post, in fact) in the worst possible way.

This is a completely unhelpful assertion. Maybe you could point out to me where I went wrong and where they corrected me. I already know that it's entirely possible that I miss understood their statement, repeating something I already know is just as much a waste of your time as it is mine.

A couple of weeks ago the macro blogosphere blew up over the debate of whether or not raising interest rates created inflation or deflation. There are numerous disagreement over fundamental issues like this and there are schools of thought that have significant disagreement with no school having a monopoly of authority over macro economics.

Macro is a completely different animal then the more scientific areas of economic study. If you go back to nicks blog post you can see the pseudoscientific nature of macro in the first two comments. Whenever someone makes a claim you don't like just argue that they are omitting variables, ezgame.

First off, it's lower then that, and secondly even if it was $20 mil, making $750/k day, you would pay it off in less then a month.

what?

are you insane? If anything I way underestimated.

30% of network hashrate today = ~12 Phash/s (http://bitcoin.sipa.be/)

30% of 12Phash/s = 3.6Phash/s or 3,600,000 Gh/s

On the open market, most ASICS are selling for $15/gh/s. $15*3.6= 45million


This is of course assuming that you could buy 3.6Phash tomorrow, which you cannot.


So investing 20 million to build a team of people who could design your own hardware, find a manufacturer in china, buy 3.6Phash worth of hardware, host it, set it up, maintain it isnt so far fetched if you could deploy tomorrow. but you cannot. No one can.


Wait 6 months and watch where the network hash rate it, there are guys on btctalk.org who correctly forecasted the 2013 hashrate that by 7/2014 the lower bound hashrate will be 40Phash/s and the upper to be 68Phash/s. It would probably take you 1 year of development to manufacturing to realize an actual product that can begin hashing.


So no, you cannot just achieve 30% network hashrate anymore by dumping 20million into it. Try 150m to be safe for deployment by 2015.

I'm not disavowing the sentence, I'm just disavowing the values you are trying to use to interpret it. I do not share your values, so the fact that you can't find a charitable interpretation of that statement does not mean much to me.

I could refine the statement a little: If something could not be built and paid for through voluntary means, it should not be built, because I believe the alternative is both immoral, and leads to worse outcomes. My original sentence did not preclude funding otherwise unprofitable projects through more creative means than direct exchange, such as by selling advertising, crowd funding, finding large benefactors, or whatever, but this makes it more clear.

If you increase something by 30%, that increase only represents 23% of the new total. If you want to control 30% of the network, you have to add almost 43% of the current network. If you want to control 51%, you have to more than match what it is currently.

yeah i realized this after i wrote it, but the principle of my argument stands so I didnt bother changing much

You lost once you started arguing with one of the most consistently wrong posters in this thread. But it's good for the benefit of everyone else.

It's extremely expensive to do this, and your point is correct.

I've been over this 10 times in the thread in the past. I say the market is centralized to asic producers, not buyers. Right now, Cointerra is selling at $3/ghs. THAT'S WHAT THEY ARE SELLING FOR! WHAT DO YOU THINK IT COSTS THEM TO MAKE IT? Cointerra is making chips right now, they don't need to do this whole process of designing there own hardware because it's already done.


If they can make 10,000 chips, they can make 100,000 chips or 1 million chips. It's just about ramping up production.

It looks like the bitfury guys did this (ghash.io pool) They took about 25% of the network in a month or so if I recall. Now I'm betting they will just keep adding so they always maintain that network %. It's possible they are even mining under "unknown" or other pools and actually hold a much higher % of the network then it appears. Anybody that has the capability of getting 25% of the network in a month would be stupid not to expand under the radar.

Sure, if you ignore the difficulties in just "ramping up production", it's super easy!

Cointerra hasn't even shipped yet and already pushed back their December orders. Its January now, no matter how many progress pics they show there still isn't a shipping date.

There's a thing called an exponential curve. Understand it before you say scale.

He's been misunderstanding it for months.

Cointerra would have loved to have never shipped anything and just run on their own dominating mining. Unfortunately, there's a little thing called development costs.