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Money does not exist

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Yesterday the US Senate held hearings on "virtual currencies" (meaning Bitcoin).  Meanwhile the "virtual currency" ran up above $800/USD and it was reported it got above $900.  It pulled back but as of now, is hovering above $700.

It was interesting at the hearing, the so called Bitcoin 'experts' included FinCen and the Secret Service.  The focus seemed to be on potential criminal activities in the digital currency (not other benefits such as a replacement currency in the event of a US Dollar collapse, etc.).  

Using phrases such as "money laundering" and "criminal activity" and "child pornography" certainly did not paint a good picture of Bitcoin, for those watching with less knowledge about Finance and Bitcoin, and especially for those who had the hearings on in various bars, restaurants, airports, and other places where viewers were not focused on the hearings but could pickup the occasional keyword such as "drug trafficking."  Silk Road and a newly discovered Assassination Market have been over reported in the news and used by anti-Bitcoin antagonists as a justification to shut down the use of Bitcoin as much as possible (or at least to make it look dirty, as if users of Bitcoin are all drug dealers and child smut peddlers).  To put things in perspective, it's been reported that the largest holders of US Dollars next to central banks are drug cartels.  Oh, and banks such as HSBC and others have been involved in the laundering of their US Dollars, some knowingly.

#666666; font-family: HelveticaNeue, 'Helvetica Neue', Helvetica, Arial, sans-serif; line-height: 26px;">It’s being described as the largest cartel money-laundering scheme in history, and today, HSBC Bank headquartered in London, with offices in the U.S. will forfeit $1.256 billion and enter into a deferred prosecution agreement with the Department of Justice (#0088cc; font-family: HelveticaNeue, 'Helvetica Neue', Helvetica, Arial, sans-serif; line-height: 26px;">DOJ#666666; font-family: HelveticaNeue, 'Helvetica Neue', Helvetica, Arial, sans-serif; line-height: 26px;">). HSBC Bank USA violated the BSA by failing to maintain an effective anti-#0088cc; font-family: HelveticaNeue, 'Helvetica Neue', Helvetica, Arial, sans-serif; line-height: 26px;">money laundering#666666; font-family: HelveticaNeue, 'Helvetica Neue', Helvetica, Arial, sans-serif; line-height: 26px;"> program and failed to conduct appropriate due diligence on its foreign correspondent account holders, DOJ said.

But the DOJ is not suggesting we stop using the US Dollar because of it's use in the drug trade, nor are they suggesting HSBC is shut down because it was laundering money for criminals.  They get fined, and we all move on.  

Virtual Currency?

What is exactly a "virtual currency" ?  Merriam-Webster defines "virtual" as:

very close to being something without actually being it

Ok so Bitcoin is not a virtual currency.  It could be a digital currency, as it's purely electronic and not in physical form.  But of the Trillions created by the Fed during the QE program, still only $1.3 Trillion of M0 (physical cash & coin), as of July 2013, according to the New York Fed.

 

Note the green line, M2.  (M3 no longer being reported.)  But this chart will suffice to show the discrepancies between M0 and M3.  M0 is less than M1 (red line) by about $700 Billion.  The different between M2 and M1 is still about $8 Trillion.  That means at least $8 Trillion USD exist in digital form, electronically.  So does that imply the US Dollar is also a 'digital' or 'virtual' currency?  Or are the only 'real' US Dollars M0, physical notes?

Money does not exist

Mike Maloney has an excellent series about the differences between "money" and "currency."  But let's take things a step further, to divide our economy into 2 simple logical components, things that exist (real economy), and things that don't (virtual economy).  

Things that DO exist:

  • Tools
  • Machines / Factories
  • Gold, Silver
  • People!
  • Buildings
  • Transportation systems

Things that DO NOT exist, except in our minds, as concepts:

  • Money or currency (it's electronic entry in your bank account)
  • The markets (again, the markets themselves are virtual, although with commodity markets a virtual contract will result in the delivery of physical goods)
  • Derivatives
  • Law
  • Knowledge
  • Value, i.e. 'asset prices'
  • Theories, concepts
  • Belief

Paper money exists, yes, but as they say it's just paper.  If I write a $100 on a napkin even if I'm Ben Bernanke, it will not be accepted by anyone unless they believe they can take said napkin and use it for whatever they need to obtain in the real economy.  What makes physical notes accepted is the belief the US Dollar system, and the Fed, not the paper it's printed on.

The fact is the US Dollar is not backed by the Fed, although the Fed is the primary emission, the "Prime Mover."  The US Dollar is backed only by a belief system (as are all other currencies today).  The belief system is backed by the US military (stop believing in USD and bombs will fall shortly after, yes the villagers were right).  So money doesn't exist, it's all an illusion.  That is not to cast aspersions on illusions, as a matter of fact, the higher up you go on the Maslow pyramid the more 'virtual' things become.  Intelligence is non-tangible, as are many of the ideas we hold dear, philosophy, morality, etc.  Our financial system is virtual, it's all a big video game (to use analogy) with money being the method of accounting (not the store of wealth!).  Money is a means of exchange, not a store of value.

Many lose sight of the fact that money doesn't exist, they say they 'need' money or they 'have' money - how can you have something that doesn't exist?  It must be a boomer concept, too much experimentation in the 60's.  For those of you who have trouble grasping this, checkout Eric Fromm, "To Have or to Be."  He explains that when you own things, or have things, they end up owning you!  We won't get into the legal reality that when you have money in a bank account it's actually their asset (deposits are not bailment).  Also, anyone who bothered to read the new account opening contracts when they open a forex account would have seen the clauses that state you are basically handing your money over to the broker and should consider yourself lucky if you get any back.

Bitcoin has emerged at an interesting time, at a time when the Fed has declared there's 'no limit' to the amount of USD he will create.  At a time when few other currencies offer stable alternatives. It gives us good perspective to stand back, objectively, and examine the financial system for what it is; a construct, based on concepts, backed by 'the real economy' which is dying.

Maybe the conclusion is that the system is just outdated, and we are in a long generational transformation process to a new system, based on technology, not on fiat decree of our central banking lords.

 

 


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Thu, 11/21/2013 - 01:28 | Link to Comment carlin401
carlin401's picture

This university is the first in the world to accept Bitcoin for tuition November 20, 2013 at 9:01 pm The Bitcoin craze has made its way to the educational system.

The University of Nicosia in Cyprus announced today that it will allow students to pay for tuition fees with Bitcoin, becoming the first accredited university in the world to do so. Starting this spring, Bitcoin will be accepted throughout the entire University of Nicosia system, which includes online programs and affiliated schools.

Wed, 11/20/2013 - 13:46 | Link to Comment Kreditanstalt
Kreditanstalt's picture

Excellent!

One thing occurred to me halfway through this film: QE WILL NEVER END...

If the whole economy now depends on people 'buying' marketed shit they don't truly need the whole shebang will collapse if they STOP.

Wed, 11/20/2013 - 20:52 | Link to Comment blindman
blindman's picture

the big change in mentality occurred maybe in the 1920-40's when
marketing, eddy bernays type, kicked in through the media and
social movements, integrated, to sell, develop psychological demand
for those things and ways that could be mass produced. that
one thing changed the mentality, the norm, detrimentally.
people lost themselves and their capacity for self governance to
the corporation.
just a guess.

Wed, 11/20/2013 - 12:39 | Link to Comment ferret
ferret's picture

I have one fundamental objection to bitcoin as being something better than electronic dollars.  You have to buy BTC with something.  Yesterday it was $700USD.  However, the day before they were worth $300USD.  If all holders of BTC decided to cash out on the up-day, the system goes bankrupt, because there are not enough dollars to redeem the outstanding BTC at the inflated price.  The system can only be solvent if you are forced to redeem the currency at the amount you paid in.

Wed, 11/20/2013 - 10:45 | Link to Comment therearetoomany...
therearetoomanyidiots's picture

Instead, only try to realize the truth.  There is no spoon.

Wed, 11/20/2013 - 07:55 | Link to Comment carlin401
carlin401's picture

The bitcoin fuck is now trading at $427USD

So that be a 1/2+ haircut in less than 24 hours, and its only fucking theory that you get your money back,

BITCOIN is 'hotel california', you can join the club, put your money, ... but you can never leave.

Who would have fucking guessed?

http://bitcoincharts.com/markets/btceUSD.html

Wed, 11/20/2013 - 07:56 | Link to Comment carlin401
carlin401's picture

del

Wed, 11/20/2013 - 06:02 | Link to Comment carlin401
carlin401's picture

Bitcoin Fucks

A popular myth is propagated on ZH is that BTC is safe, here is a site that just lists BTC fucks, and they go into the 1,000's of people losing 10's of millions of dollars.

https://bitcointalk.org/index.php?topic=83794.0

Wed, 11/20/2013 - 05:18 | Link to Comment carlin401
carlin401's picture

http://rt.com/news/bitcoin-assassination-market-anarchist-983/

bernanke tops the bitcoin assasination list for hired killers, ... pay in bitcoin, the value of bernankes life 91,000 USD

should be an OP here..

Wed, 11/20/2013 - 05:17 | Link to Comment Disenchanted
Disenchanted's picture

"beLIEf" ...beLIEve

"Believing has a lie right in the middle of it"

 

 

John Trudell - An Identity Crisis As Human Beings [7:30]
Wed, 11/20/2013 - 14:44 | Link to Comment Radical Marijuana
Radical Marijuana's picture

I enjoyed watching that embedded video, although I was already well-aware of almost everything is showed, (and many of its clips I had seen before.) That video followed the standard pattern of about 95% good analysis, followed by about 5% bullshit solutions, still based on the same false fundamental dichotomies, and their related impossible ideals, as either/or black versus white, kinds of duality regarding possible futures. However, the situation tends to be way more hyper-complicated than that, with the world being vastly more technicolor than simple binary black/white.

MONEY IS MEASUREMENT BACKED BY MURDER.

Measurement exists as basic to the ability of human beings to perceive their environment at all. Perception is based upon subtracting parts from the whole. All perceptions are relative illusions of separation, or relative lies. Thus, money begins as organized lies, which are absolutely necessary to the way that human beings experience the world, and tell stories about it, that organizes their behaviors.

IT STARTS WITH PROCESS OF SUBTRACTION.

After perceiving separate beings, then across their defined boundaries passes flows of energy. The fundamentals of that perception of the flow of energy through one defined being into another is basically understood as being robbery as one living organism takes energy from another. The most extreme form of robbery is murder.

UPON THE SUBTRACTION FOLLOWS ROBBERY.

Thus, absolutely fundamental to perceiving human beings is SUBTRACTION and ROBBERY, which is why MONEY EXISTS AS MEASUREMENT BACKED BY MURDER. In that context, the Zeitgeist Movement, with ironic appropriateness, presents itself as sort of postmodernizing Venus Project, which is popular precisely to the degree that it deliberately ignores the necessarily matching Mars Project, to put it metaphorically. Of course, the author of this article "Money does not exist" on Zero Hedge appears to be sympathetic with that kind of extremely unbalanced view. However, money exists as all human realities are organized lies, operating organized robberies, into which appears money, as measurement backed by murder.

It is just as impossible to banish money as it is to stop measurement or murder from existing. Rather, the future will continue to be some kind of dynamic equilibria between different systems of organized lies, operating organized robberies, the same as it has always been. Although, for sure, there are enormous differences being driven by breakthroughs in the paradigms of basic sciences, enabling technologies that are trillions of times more powerful than ever before in human history. The accumulating pressure of those potentials is absolutely guaranteed to eventually blow away the currently established systems, in one way or another, since pumping up the established social and political systems with powers that are trillions of times greater than ever before in human history must necessarily drive the current systems of organized lies, operating organized robberies, through some profound changes of state, at some critical tipping and turning points, where more and more quantity forces qualitative changes.

However, the most abstract basics stay the same. Indeed, if civilization survives enough, then, as the computer/machine entities evolve into a new kingdom of life, they will develop their own sufficiently complex models of the world, with models of themselves within their ability to model their world. They too then, like self-aware humans before them, will pass into apparently infinite tunnels of self-reflexive, self awareness. They too will then duplicate, probably even more so, all of the chronic political problems, with their own internalized psychological states, as they too will have the issues of hardware/software, and evolutionary ecologies surrounding their survival, as beings that are self-aware of their own relative survival.

The tremendous ironies, and awesome difficulties that human beings have now is their relative degree of progress in some sciences, enabling awesome technologies, inside of social and political systems which were based on the long history of warfare, whose success was based on deceits, which then enabled the building of fundamentally fraudulent financial accounting systems, which are actually operating organized lies and robberies, in ways which deliberately deny that they are doing that.

It remains to be seen whether, or to what degree, enough human beings can go through enough of a transformation to enable intellectual scientific revolutions which can be sufficiently expressed through political science in general, and through militarism especially. At the present time, most of the potential for better applications of advancing science and technologies are being strangled to death by the currently dominant systems or organized lies, operating organized robberies. In particular, the debt controls depend upon the death controls, and that fundamental connection is operative through its own paradoxical ways of succeeding by denying itself.

At present no new technologies can be developed unless they operate through the accounting systems that require more money to be created out of nothing as debts. However, clearly the world has already rode the rails of debt slavery until its numbers have become debt insanities, and adding more debts to pay for developing anything is therefore becoming more and more problematic. Thus, near towards the end of that embedded video, where it reviewed the financial sector, its analysis was useful, in my opinion, but then quickly collapsed back to bullshit as it got closer to its ending, to wrap up that video, with classically reactionary revolution recommendations regarding bullshit "solutions."

NONE of the possible solutions can actually operate outside of the frame of reference that money EXISTS as measurement backed by murder. None of the alternatives can ever be anything more than alternative systems of lies, operating alternative forms of organized robbery. To fund any alternatives will require alternative credits, which become a new form of debt controls, which MUST necessary be based on alternative death controls. Therefore, I repeat that the basic problem with this kind of unbalanced baloney "Venus Project" is that it deliberately ignores the necessarily matching "Mars Project."

There are surely an abundance of creative alternatives, which could be assembled into systems. However, the necessary keystone to any architecture of assembled alternatives must be the alternative death controls. That is the lynch pin that will continue to be vital to holding together all the rest of those possible entrained processes. Money can not disappear as long as sentient beings are born, live and die in the world which they are self-aware of. As long as they can make measurements, and act upon each other, with the limit case of that possible action being murder, then the same evolutionary ecologies of energy systems continue to manifest through those processes.

Wed, 11/20/2013 - 04:10 | Link to Comment ebworthen
ebworthen's picture

Any digital money based upon electronic technologies controlled by the state (electricity and the Internet) cannot be sound money.

Wed, 11/20/2013 - 04:06 | Link to Comment Not_Sure
Not_Sure's picture

"Using phrases such as "money laundering" and "criminal activity" and "child pornography" certainly did not paint a good picture of Bitcoin,...."

 

That's because the government doesn't want what Bitcoin represents........FREEDOM! All those negative activities are reflective of a free society and the fact that deviant behavior is and will always be with us. No matter what the currency of the realm is. They just want to control everyone; good or bad.

Wed, 11/20/2013 - 04:04 | Link to Comment Minburi
Minburi's picture

Marriage also does not exist as anything but an idea.

Wed, 11/20/2013 - 04:07 | Link to Comment TheHound73
TheHound73's picture

ditto for the United States of America.

Wed, 11/20/2013 - 07:41 | Link to Comment Squid-puppets a...
Squid-puppets a-go-go's picture

double ditto God

Wed, 11/20/2013 - 03:06 | Link to Comment ebear
ebear's picture

If money did not exist, we would have to invent it!

 

Wed, 11/20/2013 - 01:57 | Link to Comment carlin401
carlin401's picture

Mission Creeep NSA/US-MIL world government Bit-Coin Justification ...

Don't DRONE ME BRO, Cuz my BTC SW had a hick-up..

Most of the ideas were already out there, you can see Satoshi's original paper, and he gives credit back to the 1980's.

What Satoshi's did is statistically prove that so long as the system remained peer-2-peer and there were >+500 'good guys' to bad-guy ratio, then the quality of info would be near 0.98% kosher.

Of course the current system is not P2P, its centralized by mt-gox ( the likes of pools and exchanges in order to 'toll 'tax' ),

**

Also what we know is that almost all the MSM including ZH is given 'free' bitcoin donations, which of course is a massive conflict of interest, such that now we have almost all the MSM loving BTC to death,

When the Russian or Chinese or Czech's start injecting millions of bad hash-blocks into the system, it will fail, most likely some smart guy will demand a ransom, and the bitcoin.org ( wash dc lobbyists for BTC ) will PAY, ... eventually the US Government will step into to offer 'protection' for bitcoin.org.

Then it will become a death-penalty ( droned ) to inject bad hash-blocks into the system, the NSA will be looking for such, and all in the world will except this NEW mission by the NSA/US-MIL.

Wed, 11/20/2013 - 01:45 | Link to Comment Godisanhftbot
Godisanhftbot's picture

 So lets replace something that doesn't exist with something that doesn't exist just for kicks.

 Its all about the scam, pure and simple.

 Will end in tears.  Your's, not mine.

 

 

Wed, 11/20/2013 - 04:11 | Link to Comment ebworthen
ebworthen's picture

How about sand?

Then we can break windows ;-)

Wed, 11/20/2013 - 02:15 | Link to Comment carlin401
carlin401's picture

Kind of like iCarus, ... first the FED figured it could pull paper out of its arse, ... then all the US politicians figured out the honey-pot had no bottom, then all country's on earth immitated,

Now every 2-bit country has paper-money flying in heaven with wax-wings,

Some say the 'sun' will come out.

I too have postulated this since the 1970's, and after 40+ years I quit, ... I now accept the premise that we all can and will fly forever in the heaven's, just like iCarus.

Sure put 5% in GOLD and bury that gold, and consider it your parachute.

If you must BUY BTC, then learn a little bit about crypto-currency, and start your own 'soft coin company' [ website ], after all if your doing this for money, you must know that only 'early adopters' ever make money off of chain-letter/ pyramids scams/ ponzi's... If you have your "Mini-Me...-coin" that you can make for free, and get back product/service from other's that is where you want to be, ... no risk.

Don't laugh, almost 50% of the 'mining pools' listed were just created in the last month, ... its never too late to create your own pyramidal-ponzi, and then there's the HW,... folks are making millions selling HW to the 'miners', and of course the miners ain't making a nickel, only the suppliers.

This is one angle of the paradigm that I love, cuz its true, in the gold rush only those selling 'kit' got rich, the guys who went to pan in general lost their same now, in this ponzi mining scam,... its the guys burning power bills and buying nvidia/amd HW and ASIC chip-sets from china, ... and its making the HW vendors richer.

Wed, 11/20/2013 - 00:08 | Link to Comment Keloid
Keloid's picture

If you understand the informational requirements for a personal check, a simple cocktail napkin can be converted into a negotiable instrument with the simple use of an in pen.

Tue, 11/19/2013 - 23:12 | Link to Comment Kassandra
Kassandra's picture

I, for one, have little or no money...so I completely agree with the title of this article.

Tue, 11/19/2013 - 20:10 | Link to Comment CynicLaureate
CynicLaureate's picture

Lots of good criticisms in this video, but their solution is an oligarchy deciding who gets wht share of stuff made by robots.

It's always so funny when people with no science or math background try to tell me how we're going to run the world with energy from solar roads or geothermal energy.

A (shorter) rebuttal:

http://www.youtube.com/watch?v=Pg5K07c72Tw&feature=share&list=PL19C6559E...

 

Tue, 11/19/2013 - 20:19 | Link to Comment honestann
honestann's picture

Good to point out that "money" (as people mean it today) doesn't exist.  Individuals should be careful about the concepts they hold in their brain, and certainly "money" is a concept people should pay attention to.

For example, when the author says "money doesn't exist", would he claim the same in a society or world where the usual way to obtain goods is to hand over gold coins?  What if "gold coins" is what people mean by "money"?  Does "money" exist then?

Such questions require very careful thought to straighten out and answer precisely.  One might ask whether "money" is an exact synonym for "gold coin".  If that is the intended meaning, then one could say "money" is just a different way to spell "gold coin", just like "water" and "agua" are different ways to refer to the same substance.  In this case, one can say "money is real" because "gold coins are real".

Today, of course, what passes as "money" is definitely not real, even though some of the coins and paper that people pretend are money are "real metal" and "real paper" but not "real money" (except in the sense of being a "real fiction", which "SantaClaus" is too... qua fiction).

Unfortunately, the author who starts out asking an important question heads off in the radically wrong direction at the end.  His thought process is defective in the usual way - he fails to hit reset, start from scratch and identify the fundamentals involved before he sends his brain on an extremely destructive wild goose chase.

What is the fundamental?  The answer is: "trade".  The fundamental nature of the entire topic is "individuals trading goods for other goods".  If you produce copper and you need eggs, you want to trade copper for eggs.  Or as every kid knows, "I'll trade you my baseball card for your cupcake".

The next fundamental is the fundamental weakness in this most simplistic form of "trade"... namely, finding someone with eggs who needs or wants your copper.  It can be very difficult to find someone who has what you want, and wants what you have, and wants to trade in the same quantities you want.

This is where the concept "money" appears.  The concept of money is ABSOLUTELY NOT to invent something that isn't real, or has no value!  Just the opposite.

-----

The point of money is two-fold.

#1:  To identify one real, physical good (material) against which we can all set the exchange rate AKA "price" of our goods.  So, for example, if we produce eggs, we simply need to specify how much gold we are willing to accept for each of our eggs (say, 0.005 grams of gold per egg), or each gram of copper (say, 0.008 grams of gold per gram of copper), and so-forth for every good.

What is the purpose of this?  When everyone sets the price of their goods in terms of "grams of gold", everyone can easily and instantly compute the exchange rate of any good for any other good.  Without such a standard of value, everyone would need to keep the exchange rate for every good versus every other good, which would be millions of lists, each containing millions of entries.

By having one standard of value (one gram of gold), everyone on earth can now compute the exchange rate for any product versus any other product by simply dividing the two exchange rates versus gold.  In our simple example, the exchange rate is "5 grams of copper == 8 eggs" (or 8/5 eggs per gram of copper, or 5/8 grams of copper per egg).

#2:  It is vastly easier to trade any good you have for any good you want by making two trades rather than one.  The naive reply might be "how can 2 trades be easier or less work than one trade", but simple observation reveals why this is true.

If you have some quantity of copper you want to convert into eggs, for instance, how are you going to find an individual who has the eggs, who wants the copper, and who wants to trade for the quantity of copper you want to get rid of?  Good luck with that!

In contrast, if you accept gold coins for copper, you can easily find someone willing to trade gold coins for your copper (trade #1), then easily find someone willing to trade their eggs for your gold coins.

This is easy for two reasons.  First, everyone knows the appropriate exchange rate, and second, everyone knows they can trade the gold coins they receive for any quantity and mix of goods they want.

-----

Now let's be clear.  The "standard" of value need not be gold.  Many other other plausible materials and goods exist, though nobody has ever identified one that works better than gold.  Also, nobody is required to accept gold in trade for their goods, and nobody is required to trade their gold for other goods.  Every pair of individuals in a trade is free to trade any combination of goods for any other combination of goods.  And they're not required to buy or sell at the "standard" price, either.  Everyone is free, in every respect.  The "gold standard" literally is a "standard"... simply the "standard, conventional way to value goods, and usually an easy way to trade goods for goods through the 'two step' process described above".

-----

The single most fundamental and crucial aspect of the process of trading is that both individuals in a trade receive equivalent value.

Which means, any scheme in which one party receives goods that have value, and the other receives something/anything that does not have value, someone got cheated!

Which means, of course, that every cash, check, credit-card, debit-card transaction today is in fact fraudulant.  Of course the predators-that-be (DBA "government" and "central bank") have mandated that individuals conduct fraudulant trades.

Nobody would ever have accepted such an atrocity out of nowhere.  Only via the usual "small steps to boil the frog" could such a travesty ever been foisted upon this planet of the apes.

First people trade via barter (real goods for real goods).

Then people trade via modified barter (real goods for gold coins), which is still real goods for real goods, but takes advantage of the "two step" described above.

Then people are scammed by predators-DBA-bankers to accept "paper receipts" for their gold coins, and people naively conduct trades of goods for paper receipts that pretend to be equivalent to gold.

Then finally the predators are so strong, and have so completely destroyed the brains of the majority of the population, that they can remove the pretense of gold backing completely (by leaving the appearance of the paper very similar), thereby removing the last shred of pretense of honest trade gone.

-----

The solution is not to invent a hyper-virtual fiction and call it "money" or "currency" or anything else.  The only honest solution is for human beings to trade real, physical, valuable goods for real, physical, valuable goods.

PERIOD.

EVERY alternative is flat-out fraud and theft.

If anyone wants something from me... I only accept gold, silver, platinum, or some real, physical good that I currently need or want.  Anyone stupid enough to accept pieces of paper or digital bits held by overt predators in some bank somewhere... is a naive fool.  And if you don't believe me, within a decade you will find out in spades what a fool you've been --- when your "money" and/or the value of your "money" vanishes like a fart in a typhoon.

PS:  Just because we are fed up with the predators-DBA-banksters and their fiat, fake, fraud, fiction, fantasy, fractional-reserve hyper-rehypothecated debt "products", and just because bitcoin is "cool" and pokes fun at the banksters, and just because "David vs Goliath" is fun to watch when David gets in a few arrows in the bullseye, doesn't mean we should let our brains turn to mush and ignore the fundamental problem with bitcoin (no instrinsic value).

Wed, 11/20/2013 - 03:22 | Link to Comment TheHound73
TheHound73's picture

Nah, intangible mediums of exchange can work just fine.  When the textbook you are quoting from was written there just was no means to quantify such things. But that problem has now been solved.  At any rate, whatever a buyer and seller can agree on to label as money is no business of you and me.  On the other hand, given an economy, patterns emerge regarding what forms of money are used within that economy.  Obviously, to spend money within an economy you must first acquire it somehow.

Thu, 11/21/2013 - 00:28 | Link to Comment honestann
honestann's picture

Well, you do have an important part correct.  It is not your business or my business to tell others what they can accept in trade.  You are totally correct.  But that includes all "governments" and "central banks" and "banks" too.

So we agree on that.

However, just as a friendly warning to every honest, ethical, productive, benevolent individual out there, I say this.

You are nuts if you accept anything in trade that has no intrinsic value.

But yes, everyone has a right to be stupid, to give their wealth away, to throw their wealth away, and generally strenthen predators and parasites at the expense of themselves.

PS:  You give no reason why anyone in their right mind would accept stuff with no intrinsic value for their goods, when trading goods for goods works just fine.

Thu, 11/21/2013 - 00:41 | Link to Comment carlin401
carlin401's picture

Your style is kind and gentle, but the fact is there have long been guard rails on roads for a reason, and that is because the vast majority of men and women are too stupid to stay on the road.

In a society if the stupid are allowed to squander their earning's on the fraud of the week, then who pay's to feed his/her hungry children?

Yes, there will always be predators, and worse of all there will always be fools with money looking for 'easy wealth', and the predators will always be there to offer 'easy riches' to your 'stupid citizens'. In a perfect libertarian world if a man wants to destroy his wealth fine. But we have guard rails for a reason to protect others. Most of the time when the stupid lose their money, it does harm others.

They have given a reason why people accept 'stuff with no value' many times, just like 'cabbage patch dolls' a few years ago, many hocked the house to buy an inventory, I still know people whose garage is full of 'cabbage patch dolls', they had no intrinsic value, but all the lemmings thought they would all become invaluable. Just like now everybody on ZH "KNOWS" that BTC will go to a million dollars.

When this show is over of course, there will be nothing left in the garage.

"Stupid" really does harm society Ann, and you know this. Like voting for politicians that continue the 'cargo cult'. Stupidity effects all of us.

When BTC finally comes crashing down the GUBMINT will step in and build 'guard-rails' to protect us from crypto-currency's, and that means new FED powers, that non of us 'libertarians' want.

 

 

Thu, 11/21/2013 - 03:23 | Link to Comment honestann
honestann's picture

Yeah, I hear ya.

But...

Those platitudes don't work.  In fact, they work in reverse.

I was surprised when I finished high-school, hit the road in my rust bucket, and drove to the other (west) coast, and all over the place out west, cuz it was so cool.  There were so many places on mountain roads where no guardrails existed.  I mean, places where you'd tumble down several thousand feet at a 35 to 70 degree angle until the various bits and pieces of your car and body stopped at the bottom of some ravine where nobody would ever even notice the pieces.  Drive accordingly.

Well, plus astronomy was my focus when I was young, and my good works at a young age always got me access, and sometimes gigs, at observatories everywhere.  And let me tell you... some of the roads to some of those mountaintop observatories were... well... beyond what most people would believe.

That never bothered me.  In fact, those places (and even just the trips up there) were awesome!  Drive accordingly.

I mean, think about it!  You say:

In a society if the stupid are allowed to squander their earning's on the fraud of the week, then who pay's to feed his/her hungry children?

And who, pray tell, will stop them from squandering their earnings?  Obama?  Bernanke?  Who?  You should see immediately, what matters is making sure people realize they are "swinging and flying through life without a net" (flying trapese metaphor).

That understanding is what kept me alive in a great many potentially dangerous places over the years.  That understanding is what keeps me alive when I fly my little airplane around, and land on the short little invisible straigthaway of rock that functions as my "runway" next to my home in the extreme boonies.

Who is supposed to make sure I don't fly into the ground, or fall asleep during a long hop across a portion of the south pacific ocean?  Obama?  Bernanke?  GoldmanShafts?

Of course it harms people to lose their money.  It also harms people to be stupid freaking sheeple, to waste money on fads, to believe fictions are real, and so forth.

The only real solution is to make sure every individual knows... they are on the flying trapese of life... without a freaking net.  THAT is what has kept me alive, and that is the only thing that can keep anyone alive and healthy.  Because if you or they imagine someone else will protect them, they are guaranteed certain to be screwed by... some drug pusher, some bankster, some professor, some employer, some government worker, some street thug, some friend who knows when they are away from home... someone, and over a lifetime, many someones.

The reason BTC is accepted is... because fiat, fake, fraud, fiction, fantasy, fractional-reserve debt-notes are accepted.  The predators-that-be have been telling every little kid for decades that only a foolish barbarian would want to receive something real for their time, effort or goods they produce.  Since almost everyone accepts that, BTC gets a free pass from far too many people - many of whom applaud BTC simply because it is NOT the federal reserve - as if that is sufficient!  I guess they don't even remember WHY they want to "end the fed".

The other day when I was a bit annoyed at the whole bitcoin furor, I had the momentary notion of helping someone start something like "goldbit" or "bitgold" or <think-up-some-clever-name>... that works in vaguely similar way as bitcoin, but where each "bit" can only be purchased with a gram of gold, and each "bit" can be exchanged for a gram of gold (as far as we're concerned).  Of course anyone could accept these "gold bits" for any product or service too, if they wanted to, just like bitcoin.

I mean, if people think "virtual" is cool... they're wrong in this case.  But if they insist, at least give them something that is 100% backed by one gram of gold.  I was even trying to think of a way wherein they could get on the internet anywhere and actually look at the actual "bit" of gold that is being held for them.  Not that every "gold bit" would be a 1 gram bar or coin, but perhaps every "gold bit" would be 1/1000 of a specific 1kg gold bar (with a specific serial number and everything).  They wouldn't necessarily be able to redeed for the exact same bar that corresponds to their "gold bit", but there would be a 1 to 1 correspondence between every "gold bit" and a specific real, physical gram of gold on a real, physical bar of gold... which is to assure that no form of fractional reserve practice was involved.

Of course one reason I don't like this, is because the holder of a "gold bit" is still taking on faith that each 1kg bar of gold hasn't been assigned to anyone else, or made collateral on a loan, or any other form of BS that banksters know so much about.

The bottom line is, the only solution is to trade real, physical goods for other real, physical goods of ~equal~ value.  NO exceptions.

Wed, 11/20/2013 - 01:36 | Link to Comment orez65
orez65's picture

Dear Honestann:

This is the best post about money that I have read in ZH, thank you.

Wed, 11/20/2013 - 03:28 | Link to Comment Radical Marijuana
Radical Marijuana's picture

Honestann loves to daydream about a world without predators. That that is impossible does not deter those kinds of daydreams. Adding in the problem of predation makes things infinitely more complicated!

Thu, 11/21/2013 - 00:37 | Link to Comment honestann
honestann's picture

What an amazing statement!  Wow!  So, let me get this straight.  If you decide to travel through a jungle full of predators, your way to protect yourself is "don't worry, be happy"?

Wow!  I'm not daydreaming, I'm talking about how to avoid predators, avoid the traps predators set, and kill them if necessary.  That's not about daydreaming, that's entirely about taking real action in the real world to avoid and defeat predators.

Yes, just because it is impossible to get rid of all the predators on planet earth doesn't mean I should give up and just let them consume me.  That's right, I'm better off if I think about ways to avoid and defend.

You are certainly correct that the problems of predation make life massively more complicated --- except for me, that's the reason to "dream" up ways to avoid being harmed by the predators and their traps, and be prepared to defend myself upon direct frontal (or rear) attack if necessary.

And, just looking at the facts, I've taken a lot of real actions that have made me able to avoid almost all predator scams, and live about as free of worry as anyone can... until I can get off this planet and only need to protect myself from inanimate dangers like solar flares, meteors and debris.

You're an insightful guy... I can't believe you see my comments about predators the way you do.  Stunning!  I'm as practical an individual as you're ever likely to encounter.

Thu, 11/21/2013 - 03:34 | Link to Comment honestann
honestann's picture

Hey, that's very cool.

Thanks!

Not sure whether you know this, but a pick-and-place machine (for assemblying PCBs) might be my next purchase.  What I really, really, really want is to be able to make my own ICs, not just program my own FPGAs, but that remains way out of my league when it comes to price (since I'm not interested in anything older tech than perhaps 45nm, and prefer 28nm).

Being able to make my own PCBs would be a great complement to a pick-and-place machine, and in fact make it all that much more practical.  Unfortunately, I suspect it will be a while before it will be capable of the kind of PCBs I create, which mostly contain 0.10mm (4-mil) traces (and wider when necessary).  At least for now I'm able to avoid going below 0.40mm pitch on my BGAs, QFNs, etc, and 0201s for discretes.

It would be great to bring all this "in house"... or should I say "in boonies"?  Hahaha.

 

Wed, 11/20/2013 - 13:30 | Link to Comment Anusocracy
Anusocracy's picture

Why are the predators allowed to interact with non-predators?

Government. So the sheeple will want government to protect them.

If you aren't civilized you don't partake in civilization.

Wed, 11/20/2013 - 14:55 | Link to Comment Radical Marijuana
Radical Marijuana's picture

Predators made the government. The sheeple do not get a real choice to not be governed by the wolves. Nothing but other predators could replace them.

Predator/parasites are found in every ecology. From a deeper perspective, they are necessary to balance systems. Moreover, they just take advantage of an opportunity because they can. As long as the opportunity exists, some group will develop to take advantage of that. Theories about getting rid of all predator/parasites are impossible at all level, from the short-term to the longer term. Why promote a theory which can never actually exist in the real world?

P.S.

I still regard Bitcoiin as a smaller parasite on a bigger parasite. There are no miracles to resolve things, only slight changes in the dynamic equilibria between things, which sometimes go through more dramatic changes of state, before they settle down within another fairly constant system, for a while, as long as the overall environment will sustain that.

Thu, 11/21/2013 - 01:08 | Link to Comment honestann
honestann's picture

Yes, predators made "government", and predators are "government". And yes, sheeple cannot choose not to be governed by predators.  And yes, as long as any powerful entity like "government" exists, predators will remain in control, or soon gain control if they ever momentarily lose grasp of the reigns.

You're on a roll... correct about everything.

I think we can also agree that the evidence very strongly implies that the vast majority of humans are rather disposed to be sheeple.

The only thing you're not correct about (by implication) is... the assumption that all individuals must remain sheeple.

What might not be obvious, and I admit I don't make this explicit very often in my posts, is that my comments are directed at the vanishingly tiny minority who are the exceptions.  I mean, those individual humans who have what it takes, or at least potentially have what it takes, to not be sheeple.

It is to them who I speak.

Given this context, two scenarios exist.

#1:  Take actions to avoid predators.  Take actions to prepare to defend against predators if and when necessary.  And avoid taking actions that sanction, defend, finance and strengthen predators.  This is what humans can do on earth, where the environment massively favors predators (especially now that frontiers are difficult to find, inhabit and/or develop).

#2:  Move to an environment where the very nature of that environment makes the modus-operandi and techniques of the predators ineffective or grossly inefficient.  This is the reason to get off the planet, because the sheer immensity of space (even just this solar system) and its characteristics make predator domination utterly impossible (or so inefficient as to render the predators at an astronomical disadvantage).

You say predators and parasites are found in every ecology.  That may be true on earth, and to a tiny extent in earth orbit, but I don't think you can point them out very easily in the asteroid belt or elsewhere in the solar system.  They may dominate the moon and mars eventually, but... that's about all.  They're not going to dominate the volume of the solar system, much less the volume of the galaxy, much less the volume of the universe.  Too big, too easy to hide, vastly more time, energy and resources required to go hunting for producers.  Whatever they might be able to collect in the rare cases they found and captured one, is an infinitesimal fraction of what they had to invest to find and capture their prey.  Not to mention that attackers tend to be rather visible sitting ducks in space.

So my rants aren't for you, radical marijuana, because... sadly... you're not nearly radical enough to escape the sheeple category.  So I suppose in some ways that makes it semi-appropriate for you to adopt strategies like "if you can't beat them, join them", or however you'd characterize your approaches.

Without a doubt, therefore, your advice is appropriate for a vastly larger crowd.  Which is quite alright with me/us.  I always prefer quality over quantity by a large margin.  Or maybe that tag "quality" is biased, maybe substitute the terms "honest, ethical, productive, benevolent, brave, capable, and above all, independent and intransigently stubborn".

We'll take the orbit vastly less traveled.

Thu, 11/21/2013 - 00:57 | Link to Comment carlin401
carlin401's picture

Predators is a very tough word here, for  what exactly is a predator? Is he a saver? Most humans are only days away from cannibilism, thus we're all predators.

I think that Ann and her foes speak of 'Altruism', something not to be found these days in US policy or rhetoric at home or abroad.

All great wealth involves some kind of 'fraud', that's a fact. I learned this long ago. All great family fortunes come from crime, Gates to Joe Kennedy. Gate stole MS-DOS, and sold it to IBM, when it wasn't even his to sell, and Kennedy ran whores and illegal stuff in his time.

I find particularly distrubing about BTC is the nerd's are now also become 'kleptomaniacs', or predators as you would say, but I not see 'hoarding' as bad, that's just saving, but I do know that many in high-tech think that saving is bad, that spending money is the secret to a well run society.

I think that us libertarians would prefer to live it alone, and keep what is ours, and what we worked for, then you have folks that go to government and they see their jobs as to re-distribute the wealth.

Who are the predators?

Predators made the gubmint? I dont' think so, rich men made the government to protect their 'interests' Hamilton and Jefferson both agree on that principle.

Then there out right criminals, given that over 45% of the BTC exchanges to date have stole all their customers money, with no re-course, I would call these predators, and given these statistics you would have to be "FULL RETARD STUPID" to keep your BTC in an exchange, your mining operation in a 'pool'. For now BTC crime does pay, because law enforcement doesn't understand it, and to date nobody has gone to jail.

In the animal world, it generally is the crippled and stupid animal that get's eaten, so are predators really bad?

 

Also we have a choice? We can watch, and comment or we can engage, or we can even become predators and run a btc exchange, or create a mining pool, or create our own BTC and hype it, ...

 

In any society its always the same 90% toil, 5% steal, and 5% save and hoard. Animal and human. The 5% savers in theory should be able to keep, but generally the 90% collude, and orchestrated by the 5% criminals, ...

In our modern times probably the best thing is to live in a place like Singapore where everything is tightly regulated to keep the criminals in fear.

 

The modern USA of course was always a penal colony, and now +90% don't have shit, and will steal or beg to get whatever,... its a fucking mess. For RM I might ask why are you there? Why not live in a place where MJ is legal?

 

Thu, 11/21/2013 - 01:30 | Link to Comment honestann
honestann's picture

You make many good comments that I agree with.  Unfortunately, you haven't read most of my posts, where I say exactly what I mean by "predators" and "parasites" and "producers" (which is how I generally trifurcate the human species).  Though I focus on the predators and producers because that is the essential bifurcation.

If you had read my posts, you'd know that I say humans used to all be predators... until one, then a few, then quite a lot learned to "take actions that caused goods to exist that otherwise would not have come to exist".

You would have learned that predators had (and still have today) a modus-operandi something like "get away with whatever we can", and that it was producers who invented the utterly natural (non-mystical, non-religious) notion of "ethics" to identify the relationship of causality to human action - in order to say how they intended to interact with other producers, and with predators.

Their "ethics" basically idenfied that "each individual should enjoy/bare/suffer 100% of the consequences of his actions, and enjoy/bare/suffer 0% of the consequences of actions taken by others".  In other words, "let he who is cause bear the effects".  In practice, the idea was "producers treat producers as friends, collaborators and neighbors, and treat human predators in the same way as any other predator --- with an arrow, spear, knife or bullet through the brain".

I agree with you that [probably] all great wealth involves some kind of fraud.  If anyone truth is the cause of astronomical wealth, then they deserve that wealth.  However, all your examples are correct, and endless others are too.

Bitcoin isn't the first place that attracted nerds.  Who do you imagine fills most of the rooms where NSA does its dirty work?  I'm a nerd, but I don't defend other nerds who work for the predators (evil empire).

If you read my posts, you'd understand that what people call "government" and "corporation" are in fact pure, undulterated fiction --- they don't exist.  What does exist are predators-DBA-government and predators-DBA-corporations and predators-DBA-central-banks, and predators-DBA-unitednations, and predators-DBA-all-sorts-of-freaking-fictional-organizations.  The predators exist, but none of the organizations exist, or "authority", or "officials", or "laws", etc.

ALL that is pure fiction and pure fraud, which my posts explain in brutal detail.

There's lots more.  You'd probably either enjoy reading my old posts (many are available, just search for them via your accounts setting), or they'd drive you nuts.

Tue, 11/19/2013 - 19:44 | Link to Comment Son of Captain Nemo
Son of Captain Nemo's picture

Could have thrown some links with real World examples like what happened to Saddam Hussein, Muammar Gaddafi and if Russia should decide to step away Bashar al Assad to -

"The belief system is backed by the US military (stop believing in USD and bombs will fall shortly after, yes the villagers were right)"...

Otherwise this was fantastic.  Pretty much sums it all up in 3 paragraphs.

Tue, 11/19/2013 - 21:22 | Link to Comment delacroix
delacroix's picture

the president of ghana asked for his country's gold back, and died mysteriously, shortly afterwards.   he presided over a pretty successful democracy.

Tue, 11/19/2013 - 19:43 | Link to Comment Nimby
Nimby's picture

Gold is money.  Silver is money.  Lead is money, bitchez!

 

What good is a digital currency if the fucking internet is down?

Tue, 11/19/2013 - 20:14 | Link to Comment LawyerScum
LawyerScum's picture

I would like a system that uses both PM's and crypto-currencies.  Crypto-currencies for all your internet related needs and PM's for your local barter/trade.  Both have utility.  Let us all slowly shift to these things and just let the old centralized system wither and die.

Tue, 11/19/2013 - 21:49 | Link to Comment Nimby
Nimby's picture

I have no hatred towards paper money; so long as it converts: tax free.  

But back to my point...the old centralized system also controls the internet.  The old centralized system also controls the electrical grid which powers the internet.  If that old centralized system crashes, what is going to come out on the other side?  What will back my claim to my digital property?  Nothing.  

 

Tue, 11/19/2013 - 19:07 | Link to Comment Randoom Thought
Randoom Thought's picture

I have to believe that Bitcoin is THEM (THEM being the Gnomes of Zurich). It may be THEIR trial balloon and the early adopters and speculators will be screwed or it may be the eventual global 100% electronic criminal banker wetdream that it has promise to be and those who buy a few now will be gazillionaires. As with all moral and ethical questions, it is not the media that will tell you right from wrong, but your heart that will stear you away from what is wrong and toward what is right.

Tue, 11/19/2013 - 18:36 | Link to Comment Never One Roach
Never One Roach's picture
THE END OF THE DOLLAR STANDARD GRAPHIC - THE CURRENCY GRAVEYARD

theaustrianinsider.com
NOVEMBER 18, 2013

 

http://goldsilver.com/news/the-end-of-the-dollar-standard-graphic-the-cu...

 

Good article at Mike Maloney's web site.

Tue, 11/19/2013 - 18:19 | Link to Comment Yenbot
Yenbot's picture

400 quatloos on the newcomers...

Tue, 11/19/2013 - 18:18 | Link to Comment Peter Pan
Peter Pan's picture

What is Bernard von NotHaus to make of Bitcoin ?

Tue, 11/19/2013 - 18:13 | Link to Comment proLiberty
proLiberty's picture

Selective concerns:

Government bureaucrats are concerned about use of virtual currencies in illegal activities, but not concerned that the majority of US paper currency carries traces of cocaine dust.

Government bureaucrats are concerned that citizens might lose money that they put into "unregulated" virtual currencies, but are not concerned that when a citizen puts his money into a highly regulated listed security that he could lose a substantial amount in a "flash crash" caused by High Frequency Trading, an activity that is permitted by government regulations.

I will make my own judgments as to risk, thank you!

Tue, 11/19/2013 - 18:04 | Link to Comment Bagbalm
Bagbalm's picture

Our government is pretty good for an idea at controlling things - like our food. Try to eat without using their little imaginary dollars. It can be done but it is hard.

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