Fed's Dudley "US Dollar Wins"; Bitcoin "Not a Good Store Of Value"

Tyler Durden's picture


While the volatility of Bitcoin has been considerable, perhaps merely reflective of the early days of a revolution, the fact that the "value experts" at the Fed have pronounced:


..raised an eyebrow or two on our furrowed brows. We thought a look at the following two charts since the inception of Bitcoin and the inception of the Fed would help clarify "value" stability...


Bitcoin since inception...


And the USDollar since the Fed's inception...


You decide?

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Fri, 03/07/2014 - 16:31 | 4522648 NaiLib
NaiLib's picture

Please publish logarithmic scale

Fri, 03/07/2014 - 16:36 | 4522679 DoChenRollingBearing
DoChenRollingBearing's picture

Because Bearing Guy wishes to retain whatever goodwill he may still have here at ZH, I will attempt to make most of my Bitcoin remarks at  https://bitcointalk.org/.  My handle there is "OROBTC".

The occasional BTC comment may still leak out onto Zero Hedge though...

In the meantime: Gold, fishez!

Fri, 03/07/2014 - 16:39 | 4522703 Soul Glow
Soul Glow's picture

Gold fishez - what happens after a boating accident.

Fri, 03/07/2014 - 16:47 | 4522738 DoChenRollingBearing
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And the Pacific Ocean is even deeper than our nearby lake.  *Sigh*

Fri, 03/07/2014 - 16:51 | 4522760 tmosley
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The ZH Comment section--standing alongside the Fed since 2013.

Fri, 03/07/2014 - 17:06 | 4522809 CH1
CH1's picture

Just about what I was going to say: All the Hedgie Haters, in lockstep with the Fed.

Here's the one tool to come along that could kill the Fed, and they hate it like cancer.

Fri, 03/07/2014 - 17:08 | 4522824 Herd Redirectio...
Herd Redirection Committee's picture

Centrally controlled all digital currency is part of the NWO/World Government plan.

Prevents those nasty cash tx and bank runs.

Fri, 03/07/2014 - 17:09 | 4522832 CH1
CH1's picture

And what centrally controlled currency might that be?

If you think that's Bitcoin, y'all are TRYING to be ignorant.

Fri, 03/07/2014 - 17:25 | 4522890 zaphod
zaphod's picture

To all the bitcoin doubters.

The fact that the US FED is now making statements regarding bitcoin vs. the dollar, demonstrates how wildly successful the experiment has been so far. 

Just 5 years ago Satoshi released a simple piece of code onto an IRC channel. It had no backing and no organization behind it. There was no reason anyone had to pay any attention to it.

Over the next 5 years more and more people adopted that code out of their own free will to the point that the world's reserve currency feels they need to make public statements on why their fiat currency is better. 

That is amazing, whether or not you support the concept.

Fri, 03/07/2014 - 17:28 | 4522920 DoChenRollingBearing
DoChenRollingBearing's picture

+ 1 for an interesting remark, bravo.

Fri, 03/07/2014 - 18:22 | 4523096 Scarlett
Scarlett's picture

Ron Paul: Bitcoin could destroy the dollar


Fri, 03/07/2014 - 17:40 | 4522970 Soul Glow
Soul Glow's picture

Like a magician they have your eyes fixed on the debate which is Bitcoin vs. the Dollar instead of Gold vs. the Dollar.

They fucking tricked you bitcoiners and stole the debate.

Fri, 03/07/2014 - 18:31 | 4523137 zaphod
zaphod's picture

Not exactly sure why you think bitcoiners have been tricked, the debate actually something else vs. the dollar.

Both goldbugs and bitcoiners have agreed on the "something else". To me that means many things, which include both bitcoin and gold. So I have a little of both, along with other investments generally viewed as necessary in a currency collapse situation. 

Fri, 03/07/2014 - 18:55 | 4523237 DoChenRollingBearing
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Yep.  Both.

Sat, 03/08/2014 - 01:14 | 4524295 nanpanman
nanpanman's picture

I'm a Rhodiumbug and Bitcoin miner myself. Would not have it any other way.

Sat, 03/08/2014 - 20:12 | 4526224 MeelionDollerBogus
MeelionDollerBogus's picture

Not Sure, you say?

Let me lay it straight. Bitcoin has no value but a fiat price and gold has value from its atoms.

The more bitcoin you get the less gold you get. Period.

There is no way to efficiently get into both considering the giant rise in bitcoin's price then the rigged slam down. The fiat exchanges are rigged twice:

#1 you slam down price by selling what's held into other wallets from the same owner

#2 you slam down price on exchanges by using banking regulations to slam the doors shut

and that's not even looking at the MtGox tomfoolery of incompetence & possible fraud.

The security of gold is you can't regulate or hack its atoms: it is what it is. The energy requirement to screw with all gold ever held, atomically, would either a) take more energy than exploding suns or b) take enough energy to roughly ruin some of it but affect all other matter on the Earth's surface, killing us all, as in nuclear apocalypse.

Neither a) nor b) are happening for the purpose of manipulating gold's physical value and its fiat price doesn't matter.

Bitcoin has no value without a fiat price as we've seen. That was a Fail.

It's too late to turn back.

Bitcoin is the Fed's best most powerful friend: all the while you're pretending to hold a sharp knife to stab the Fed fuckers you're actually holding the blade - there is no handle, all blade.

Fucking idiots.

Sat, 03/08/2014 - 19:49 | 4526125 MeelionDollerBogus
MeelionDollerBogus's picture

The Fed supports its use through fiat exchanges since it can rob you all instantly of any value. That's all I need to know.

Fri, 03/07/2014 - 17:30 | 4522928 Atomizer
Atomizer's picture

Near Field Communication [NFC] tag.  If you don't know how to disable on phone, you deserve to be hacked.

How NFC phones can steal your credit card info

Fri, 03/07/2014 - 17:10 | 4522837 fonestar
fonestar's picture





Now where are those big dummies saying the Fed loves Bitcoin, blah, blah, blah?

Fri, 03/07/2014 - 17:22 | 4522882 DoChenRollingBearing
DoChenRollingBearing's picture

(They will tell you it is just Fed propaganda)

Fri, 03/07/2014 - 20:01 | 4523423 sleigher
sleigher's picture

Probably because it is.  But really isn't everything they say meant to serve them?

Sat, 03/08/2014 - 04:12 | 4524453 BlackChicken
BlackChicken's picture


That reality falls within overlapping spheres of influence; this is why it is so hard to detect at a rational level. When one sphere acts, the other spheres do not know what is going on. When the spheres interact, even a little, that is the foundation of the original goal; then there is plausible deniability, and the real OP gets to work.

Fri, 03/07/2014 - 20:35 | 4523521 dontknowcrapabo...
dontknowcrapabouteconomy's picture

Come mothers and fathers 
Throughout the land 
And don't criticize 
What you can't understand 
Your sons and your daughters 
Are beyond your command 
Your old road is 
Rapidly agin' 
Please get out of the new one 
If you can't lend your hand 
For the times they are a-changin'.

Fri, 03/07/2014 - 17:06 | 4522820 superflex
superflex's picture


If you dont support BTC, you support the FED.

Is that how your mind works?

Hash me a river, crybaby.


Fri, 03/07/2014 - 17:10 | 4522839 CH1
CH1's picture

No. Here it is:

If you try to hurt Bitcoin, you are protecting the Fed.

Simple enough?

Fri, 03/07/2014 - 18:08 | 4523055 XitSam
XitSam's picture

Nonsense. What utter bullshit.

Fri, 03/07/2014 - 18:12 | 4523065 CH1
CH1's picture

Ignorance always defends itself.

Fri, 03/07/2014 - 18:47 | 4523204 balanced
balanced's picture

Bitcoin haters are indeed ignorant. And those who think Bitcoin as a store of wealth is superior to gold are dreamers. The point is that "Gold vs Bitcoin" is a moronic debate, because it is too broad. Bitcoin is far superior to Gold as a currency. Gold is far superior to Bitcoin as a store of wealth.

Gold as a store of wealth.

Bitcoin for transactions.

Why do you morons still not get this simple and obvious solution?

Fri, 03/07/2014 - 22:10 | 4523744 Harlequin001
Harlequin001's picture

Because it's wrong. Gold stored in one place can be exchanged for gold stored in another in any two parts of the world. All that's needed is a note or receipt from one that can be sent to the other either physically or electronically and that's just as fast or faster than a bitcoin transaction, and depending on the type of note, considerably more secure. That governments are printing copious quantities of their own notes does not diminish gold as either and neither does it improve bitcoins' utility or value.

Bitcoin is nothing more than an encrypted number, and since you can have at least one of those for every Federal Reserve note in circulation it is nothing more than a valueless encrypted number and with bitcoin in particular, a speculative fad. Gold however still stays in the vault at a value considerably different to it's trading price in FRN's, waiting. Bitcoin is at best nothin more than a mechanism to transmit golds value.

Gold is nothing like bitcoin. They are entirely dissimilar. Bitcoin is for dreamers that want it to be something it's not, and outrageous rampers of course who want to sell it to idiots...

Fri, 03/07/2014 - 22:29 | 4523878 TheHound73
TheHound73's picture

 "All that's needed is a note or receipt from one that can be sent to the other either physically or electronically"

What ever happened to, "if you don't hold it you don't own it?"

Sat, 03/08/2014 - 00:52 | 4524264 Harlequin001
Harlequin001's picture

because it's always been bullshit. Most of the stuff on this planet is owned beneficially by someone else whether it be in a trust or an account or a company somewhere.

"if you don't hold it you don't own it?" whilst it sounds good is still for idiots waiting to have it taken from them by tax offices or muggers in whatever guise.

If you don't own it you can't be taxed on it can you?

Sun, 03/09/2014 - 13:10 | 4527763 XitSam
XitSam's picture

So there can only be business exchanges where there is an internet connection? That's retarded.

Fri, 03/07/2014 - 17:11 | 4522843 fonestar
fonestar's picture

No, that is how it is.  Bitcoin is the anti-dollar.

Fri, 03/07/2014 - 17:47 | 4523000 Atomizer
Atomizer's picture

My digital assets are bigger than yours nonsense has to come to a end. How about we just audit the Federal Reserve. Stop bickering on which system is better than the other. It reminds me of the yo-yo’s bitching over geopolitical policies in the jackass & elephant role. Same shit, different layer of the onion.

Sat, 03/08/2014 - 15:56 | 4525464 MeelionDollerBogus
MeelionDollerBogus's picture

Bitcoins are dollars now.

Bitcoins have no purpose but ponzi-bag-holder-passing for dolllars.

Gold is the anti-dollar. Gold is the thing no one can print, not even by collective opensource collaboration dictate the number of gold units. Ever.

Nature is intrisic value, carved into the laws of reality beyond the power of anyone to deny, everything else is an opinion.

Fri, 03/07/2014 - 17:11 | 4522840 Gringo Viejo
Gringo Viejo's picture

Dudley: I wipe my ass with your metrics.

Fri, 03/07/2014 - 17:05 | 4522812 El Oregonian
El Oregonian's picture

"Gold fishez - what happens after a boating accident."

Funny you should ask. Normally after a "horrible" accident the owner drops from the public's view and retires to their pre-selected country of choice.

Fri, 03/07/2014 - 16:41 | 4522715 wintermute
wintermute's picture

Dudley preaching to people like Buffett and Gross. Let them bleat like sheep following Dudley's advice.

Fri, 03/07/2014 - 16:31 | 4522650 surf0766
surf0766's picture

Use both sides when you wipe to get the full value.

Fri, 03/07/2014 - 16:39 | 4522706 johnQpublic
johnQpublic's picture

and thats why the dollar beats out bitcoin every time

you cant virtually wipe your ass with bitcoin, but you most assuredly can wipe your ass with a dollar

all hail the dudster

Fri, 03/07/2014 - 16:49 | 4522746 tmosley
tmosley's picture

Stand with the Fed!

The Fed is our friend!

It's evil, evil bitcoin that's the problem!  NOT THE DOLLAR.

Fri, 03/07/2014 - 19:11 | 4523280 fonestar
fonestar's picture

The devil they know...

Sat, 03/08/2014 - 01:38 | 4524325 nanpanman
nanpanman's picture

Burn the Bitcoins! Burn em!

Fri, 03/07/2014 - 16:31 | 4522652 walküre
walküre's picture

Funny he should say that. I was thinking this morning that what happened to Gox can also happen to other "exchanges". Good luck selling shares when the markets are locked up and then they say, they "lost" your certs.

Fri, 03/07/2014 - 16:35 | 4522676 optimator
optimator's picture

"They" won't say anthing as you won't be able to reach them when the balloon goes up.

Fri, 03/07/2014 - 16:49 | 4522747 Thought Processor
Thought Processor's picture



"Good luck selling shares when the markets are locked up and then they say, they "lost" your certs."


I think this is exactly what will happen.  


And then they'll say-  "For only this one window of time we are allowing you to transfer your funds, at pre-market halt valuation levels, to your MyRA account which we have already activated for you."

And they'll promis that the MyRA will not lose value (relative to the USD's that it's valued in).

It's your choice they'll say.   

Fri, 03/07/2014 - 20:14 | 4523456 TheHound73
Sat, 03/08/2014 - 15:49 | 4525456 MeelionDollerBogus
MeelionDollerBogus's picture

Excuse me! This move has already been pulled and trademarked.

This message brought to you by the Free Jon Corzine foundation.

Fri, 03/07/2014 - 20:25 | 4523483 PT
PT's picture

What exactly is a Bitcoin?  Is it simply a great big prime number?  Is it a group of special numbers?  Is it a bunch of numbers plus a bunch of instructions associated with those numbers?  What exactly is a Bitcoin?

The reason I ask, is this:  Bitcoin is called a "crypto-currency".  It sounds like each coin has something to do with encryption.  If Bitcoin is insecure, then what makes ANY other electronic transaction on the planet secure?  What does Bitcoin have that other electronic encryption doesn't have?  What does every other electronic encryption have that Bitcoin doesn't have?

Of all the "hacks" of the Bitcoin network, how many exploited a fundamental flaw of Bitcoin and how many exploited flaws somewhere else (eg. put a gun to someone's head and ask for their Bitcoin is not the same as Bitcoin suddenly disappearing into the ether during the course of a normal transaction)?

How is the security of a credit card transaction different from the security of Bitcoin?

Fri, 03/07/2014 - 23:09 | 4523655 TheHound73
TheHound73's picture

A Bitcoin is an account balance on the world-wide public ledger called the blockchain.  A private key to an account is needed to cryptographically sign a message "spending" bitcoins from one account to another.  This is one of the fundamental processes on which Bitcoin security depends and experts who have taken the time to examine it agree it works well. There has never been a documented case of this security breaking down after 5 years of trying. A private key is a very large number created randomly.  There can be 2^256 of them, or many times more than there are atoms in the universe.  Creating a private key is like going out to the forest and randomly digging a hole to stash your gold.  Except the bitcoin forest's area would cover the surface of every sun, moon and star in the universe many times over. Yes, people can go out to the bitcoin forest and start digging holes looking for stashed bitcoins, but even if they dig 1 trillion holes per second for a thousand years, they'd still be a trillion times more likely winning the Powerball 10 times in a row... another fundamental process on which Bitcoin security depends. They'd be better off using that computer power to mine bitcoins.  http://i.imgur.com/CzyO1yv.jpg  

If these concepts or security features are disagreeable to you; that's fine, use of Bitcoin is completely voluntary.

Do NOT follow this link or you will be banned from the site!