Author: gork

Bitcoin will Revolutionise FX/International Xfer Market   [Copy link] 中文

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Post time 2013-11-3 03:34:53 |Display all floors
This post was edited by gork at 2013-11-3 03:53

The New Gold Standard
- BitCoin is Screwed

My understanding of Bitcoin is that the "miners" are really transaction authenticators who get paid for registering an entry on the ledger. This ledger takes the form of a chain of blocks, the "blockchain", with each block representing a transaction.

The early blockchain was hacked and split into two threads. The whole system was then brought to a halt and  everyone agreed to revert to an old blockchain. Presumably, the blockchain is much longer now and therefore more difficult to hack.

A second fork occured in 2013, caused by incompatibility problems between versions of the software.

Many other hack attacks have occured on individual exchanges as well as the miners.

But the fact that BitCoin is limited to 21 million causes a problem. Who will bother to run up a massive electricity bill recording transactions on the register, which will be huge by then, if they're not rewarded with new BitCoins? Is THIS why Max Kiester promotes silver and BitCoins? Even if they modify BitCoin to extend it, the blockchain could become unwieldy.

However, we know the central banks are buying gold (NOT silver), the most in half a century: They added a net 536 tonnes in 2012 as they diversified fresh reserves away from the four fiat suspects: dollar, euro, sterling, and yen.
- A new Gold Standard is being born

Of course, Pilchard suggests gold will stand alongside fiat in a new monetary World order. But a bank run is when everyone loses confidence in the paper receipts and demand physical.

Similarly, Forbes suggests a quasi gold standard too: or argument’s sake let’s say the peg is $1,300. If the price of gold were to go above that, the Federal Reserve would sell bonds from its portfolio, thereby removing dollars from the economy to maintain the $1,300 level. Conversely, if the gold price were to drop below $1,300, the Fed would “print” new money by buying bonds, thereby injecting cash into the banking system.
- Advance Look: What The New Gold Standard Will Look Like

This has the same flaw as Pilchard's B.S. and is nothing more than the manipulation of the gold price we already have. Never mind that as bonds mature, there's a big (possibly huge) outflow of dollars and when the price of gold is too low yet more dollars are issued. Furthermore, if the dollar were actually stable against gold then you may as well have a gold standard. Instead, suppressing the gold price just means physical keeps flowing to Asia. It's a totally asinine idea!
And wasn't it on the Schwing-Schwing Show that Ann Barnhardt set her hair alight and ran round and round the room saying the futures market couldn't be trusted?


In a multi-lateral World, you wouldn't want a flexible currency, because you're always tempted to flex it just a little more, until you're massively indebted like the US is now; the worst debts in all of history. You WANT an inflexible currency to impose discipline to nip the imbalances in the bud. It's only because the dollar is a fraud thieving from the rest of the World that the US wants the flexibility.

Incidentally, Max Kiester was dumping silver a while back after having strapped on his suicide poopy-diaper and flushing his savings down the toilet. His attempt to shout down criticism of his B.S. is similar to that of fellow Amerikan, Adam Posen, when Mervyn King suggested fiscal policy adjustment was what was required. Clearly they both went to the John McEnroe skool of puerile behaviour. Just as Posen suggests making QE permanent (!!!), Kiester claims printing money is deflationary. If these are not two indicators that you should dump the dollar before everyone else does then nothing is.
Compounding is the magic ingredient.

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Post time 2013-11-11 16:51:24 |Display all floors
Where Does BitCoin Wealth Come From?

Everyone knows, or should know, that printing of paper money is theft from holders of earlier printed paper-money; inflation.

But who pays when BitCoins are "mined"? Transactions are verified when they're mined and 25 new BitCoins are awarded to the miner. Surely this works in the same way as gold or paper printing in diluting the value of existing BitCoins?

Yet BitCoin exchange rates relative to paper have rocketed and recently passed $300. Holders of BitCoins don't appear to have lost any wealth at all.

Of course, this is only using paper, fiat currency as a measure. So in part, this is just inflation of the paper currency.

However, there also appears to be a bubble in BitCoins; those seeing its meteoric rise and jumping on the bandwagon hoping to reap some easy gains. Even the massive devaluation of paper money by 40% hyperinflation of the monetary base every year is slightly less than would account for the rise in the BitCoin exchange rate.

Like paper money without a gold standard, it is difficult to gauge fair value for a BitCoin. But as it is nothing more than a medium of exchange, BitCoins shouldn't rise against consumer goods. In other words, if a butcher is willing to accept a BitCoin for a pound of beef, then a baker should also expect no more than, say, half a BitCoin for a loaf of bread. This is the only thing supporting the value of a BitCoin. Gold is similar except under a gold standard when the government needs as much gold as possible to print paper and why FDR confiscated gold in 1933, which is why Buffett and Bernanke "innocently" claim they don't understand gold prices; denying a gold standard is in the offing. Where BitCoin DOES have value is in limited issuance, international transfers and avoiding bank charges for transactions, taxes and invasions of privacy (not that dissimilar to gold).

So the answer is, that holders of BitCoins are also robbed when new BitCoins are mined but even more so holders of paper money. It's only because of a bubble that the purchasing power of BitCoins has increased fueled by the speculative buying as the exchange rate rockets against massive devaluation of paper money.
Compounding is the magic ingredient.

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Post time 2013-11-16 16:50:30 |Display all floors
One BitCoin fan has compared the price of gold to that of BitCoin on a 1:1 basis, ie. if every BitCoin covered every ounce of gold.

But there isn't a BitCoin vs Gold standard, just as there isn't a gold standard that would match paper currency for gold. If there were gold would be $50,000 per ounce.

But what gold has that BitCoin doesn't have is:

1) low rate of inflation vs terminal end, and
2) acceptance by central banks.

I don't see the gansters accepting BitCoins in their FX reserves any time soon. Gold can be assayed and once you have it you know you have it. With BitCoin it can and has been hacked.

On the other point, BitCoin will come to an end when it can no longer produce any more. Those registering the transactions as part of the "mining" process will no longer bother to do so (is it even possible). The banksters despise gold because they only dig up about 2% maximum out of the ground every year, preferring paper that can be hyperinflated. When BitCoin comes to a halt, they won't even get that.
Compounding is the magic ingredient.

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Post time 2013-11-17 02:55:37 |Display all floors
manoj10 Post time: 2013-10-29 19:30
Bitcoin is a failed model. Had seen people selling in panic when someone manipulated the system to m ...

I still have not a clue how Britcoin works.

Basically this is a Pyramid scam.

He who issue the original code will pockets all the dollar with no outlay risk.
Bernard Madoff would have love this.

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Post time 2013-11-17 03:05:08 |Display all floors
YIPman Post time: 2013-11-16 23:55
I still have not a clue how Britcoin works.

Basically this is a Pyramid scam.

The idea of e-currency was long laid to rest with the demise of e-gold. I can't believe many people spent fortunes to buy up e-gold points only to lose all of them.

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Post time 2013-11-17 03:11:20 |Display all floors
manoj10 Post time: 2013-11-17 03:05
The idea of e-currency was long laid to rest with the demise of e-gold. I can't believe many peopl ...

But in e-gold, at least you know those issuing the gold-ETFs may have the assets to back up their issued papers.
Example: HSBC guarantees your SPDR (GOLD) e-certificates.

Who guarantees the e-coins certificates?
A ghost, and the trust of the bigger fool down the street is the answer!

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Post time 2013-11-17 16:01:48 |Display all floors
Another Leg Kicked Out From Under BitCoin

The UK's creation of a BitCoin exchange, Bitfloor, was notable in that it excluded trading by Amerikans.

Now we learn that the land of the freaks is looking at issuing licenses for anyone trading with BitCoins, despite BitCoin not being any of the goons & thugs business whatsoever. No doubt, the goons & thugs will want their cut of any transactions. But the income tax was a lie initially imposed on the wealthy just before they started WW1 and then decided it would be rolled out to the rest of the inmates. Up until now, one of the biggest attractions of BitCoins is that traders paid no card charges etc. as they do on credit and debit cards issued by the banksters. The attack follows on from the shutting down of Silk Road. This was probably to establish the moral high ground for attacking other traders that accept BitCoin.

No doubt, like the now fourth Tesla fire in just about the same number of days, the banksters were behind this sabotage of BitCoin. The state-run BBC's Yob Gear propaganda program has previously been caught staging pre-planned problems with Tesla cars in the same way all their fake stories and interviews with someone you may have heard of in a reasonably priced car are staged. They also promote gas-guzzling hypercars and amerikan krudmobiles (the UK's amazing folding krudmobile industry has, amazingly, folded).
Compounding is the magic ingredient.

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