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JPMorgan's Biggest Concern Is That Bitcoin Will Succeed
Via JPMorgan CIO Michael Cembalest,
After digesting all the hyperbole and the pessimism, my biggest concern is not that Bitcoin will fail, but that it or one of its many virtual currency competitors will one day succeed.
In the extreme, Bitcoin may lead to economic activity moving from the regulated economy to the underground “shadow” economy (after all, one of its primary selling points lay in its inability to be traced), even if some Bitcoin recipients faithfully declare it as income.
If this were to happen, the tax burden would fall disproportionately on the regulated economy that remains, creating a lot of unwelcome distortions.
Perhaps this is why there is a clear inverse relationship between the size of a country’s shadow economy and its wealth per capita. In other words, no one likes paying taxes, but when no one actually does pay them, everyone suffers.
Libertarianism has its limits.
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Full note from JPM's Cembalest link
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Ah, love the smell of disruptive technologies in the morning.
Where? I don't see any. Bitcoin didn't disrupt anything but purchasing of silver.
First thing I thought of was that our government told JPM to hack Bitcoin and leave it bleeding. After all, they do not want gold or silver and a
threat that was successfull like Bitcoin was looking to be good so it had to be torpedoed. They have wrecked Gold. They have wrecked everything except for promises of success with the likes of Greenspan (failure one) Bernanke (failure two) and now failure 3 (Yellen).
I vote for hemp backed coin. Or a whisky backed coin. All these other medium of exchange are BULLSHIT. This stuff was covered two centuries ago by some very sharp and wise men. Gold is better than fanta coins but does not work on the grand scale. Scarcity and saving will cause it to become a mania.
So the debate is not fiat or fanta coin or gold coin. It should be between what tangable is best to trade with.
Gold is finite and that makes it a poor choice. It is therfore controlable leaving society at the mercy of whoever can control it.
Here we are debating false choices again.
PMs and tokens.
It still leaves us in the same place. The one in control of the tokens controls it all. Whereas the ones that actually produce control their own wealth. As it should be. Why should the ones that dont do shit be in charge of anything.
But that's the GOOD not the evil.
WE CONTROL THE GOLD so we are in charge.
The banks are letting go of their gold not acquiring more of it.
WE will be in control.
Any other way is doom. Suicide.
Finite resources are meant to be money, to control it all. If we can't control it all, as a people, we are slaves.
There is no 3rd choice.
Slavery or In Control.
This is nowhere near the "same place" we are now. Where we are now only fiat electrons & paper are money and government takes your resources like your home, water or food using death threats, or they shoot you and your children outright.
We need to end that. Gold is the way. And nooses. Those who've done it to us must hang until dead, the entire families, to end it for good.
"If this were to happen, the tax burden would fall disproportionately on the regulated economy that remains, creating a lot of unwelcome distortions. "
HO. LY. SHIT.
He just described exactly what happens in Atlas Shrugged.
If this occurs, it would be the productive class saying good by to the parasitic government and debt money class and moving on. The government would collapse without a host to leach off of.
Underground? No. He's delusional. It's called protecting one's productive efforts for oneself rather than letting it get stolen by the looters and rentiers.
"First they ignore you, then they ridicule you, then they fight you, then you win."
- Mahatma Gandhi
Moving right along according to plan.
Gandhi died, his nation became a nuclear nation, gang rape happens in full public view, and he "won"?
No.
Epic fail.
First they mock you, then they stomp you, then they kill your children, then they win.
This war between the banksters and the rest of the world is to be expected. It will be a knockdown fight but destructive technology will win.
There is no way that WS can rape and pillage without being cross-hair number one to every innovator out there. Good riddance to WS banksters
"JPMorgan, UBS Convictions Overturned in Milan Swaps Case"
http://www.bloomberg.com/news/2014-03-07/jpmorgan-ubs-convictions-overtu...
They're cool on this end at least.
This will become the norm as politicians (and all law enforcement people who get voted are) will win the initial prosecutions with the agreement that they will be overturned.
Welcome to the machine, fisches!!!
It's OK. The government can just dissolve the Federal Reserve and print the money it needs, directly. Thus, eliminating everyone's tax burden. Taxation, after all, is just a curb on future price inflation. And since there is no inflation....
Again, by 2020 the black market will be the largest market. Off books is more honest...who would of thunk it?
Already is. Hayek's market sounds better.
JP Fucking M:
"Libertarianism has its limits."
That is correct, you lying douchebag motherfuckers. The limit on Libertarianism is right exactly where it bumps into the State's lies and murders.
Don't think for a New York minute that anyone has forgotten the direct complicity of JP Fucking Morgan in the Corzine heist.
You lying thieves. You would be more honorable if you were an honest gambler. As it is you are regular, garden variety con men. And the worst of it? You will be forgotten, you shitbags. No temples, no statues. You will be a footnote.
I just might launch a new digitized tax free tally stick to fuck with JP Morgue.
My greatest concern is that the executive officers of JPM won't one day be tried for their crimes against humanity and summarily executed. Dude's lucky that libertarianism has its limits.
Bitcoin is untracable?
Yeah right, just like the internet was anonymous in the 1990's. It never was, but nobody was watching.
Same with bitcoin. The ledger is permanent. The wallet can be traced to your laptop.
The Silkroad guy was caught in SF at a local library using a computer he probably thought was anonymous. Nope!
Also, the Bitcoin startups here in SF want the regulation to be legit.
My take on the article is that if JPM says it won't fail, it probably will fail... My logic is that JPM always lies so I would bet on th inverse of any of their statements.
If, at some point - the banks, states, lawyers and brokers are gutted by crypto-currencies - all those mindless people who still clamor against BTC will solemnly swear they knew all along.
It is possible that crypto will fail, that it can be stopped - but it is the most dangerous challenge the banksters have ever been subjected to - and there is a solid chance that it will succeed.
A successful crypto-currency will very likely destroy many nation states - they will be unnecessary, and their inimical nature will be obvious (finally) to just about everyone. Decentralized money and finance will lead to decentralization in other area's - and hopefully a realization that decentralization is vastly more stable and free than a centralized system.
Decentralization of politics and law is very possible, and would promote incredible justice and prosperity - it is something to be wished for.
Decentralization of politics and law is very possible : noble ideas, but perhaps you might want to start with decentrailizing your mining network before breaking apart anything else.
No it isn't.
Bitcoin is inherently centralised. There is one true blockchain which represents the record of transactions and all transactions world wide have to be recorded in it. More than that, the blockchain has to be copied to all of the nodes which process transactions.
What this means is that as the number of transactions world wide increase, the number of nodes has to decrease to a smaller number of higher performance nodes, since the performance of the entire system is dependent on the performance of the slowest node (because everyone has to have all transactions). Thereby centralising the bitcoin network to those who can afford high performance computing systems (bankers and governments).
Bitcoin is the banker's and government's best friend.
Well fucking let's scrap the whole project then. :) Does JPM offer good interest rates on credit cards? :(
If Bitcoin absorb VISA and other providers transactions, the need for storage and network speed increase, but increase in a workable way. The network speed needed is available to large city around the world (like Estonia or South Korea), just not clunky obsolete lines. Scrap the old lines and build new ones. The HD space needed is not a big problem. There will be multiple full copies in istitutional places around the world and a lot more local copies with just the latests data or pertinenti data. And all will be perfectly verifiable as authentic. (In Crypto We Trust).
Bitcoin is not designed to hide your identity. It's designed to have everything out in the open. Every bitcoin transaction is stored in a public ledger for all to see called the blockchain.
He's right about one thing though, it could bring about the end of banks and governments. Boohoo.
About that. Cash is king for a good reason.
Serious question here: If everything is in the open, then why is this currency referred to as anonymous?
Corporations aren't paying taxes like they used to. Financialization has solved that problem. The US doesn't hide the fact that it no longer needs a budget. The FED and other Central Banks print what is needed because the on the books economies are only a fraction of a fraction of what is off the books.
JP Morgan is is the business destroying nations and robing individuals. Who asked them in the first place? That is what I'd like to know.
I fail to see how a crypto currancy will result in decentralization. I can see how a whisky backed coin could. Could you explain it I must be missing something.
you might want to start with an e in currency
SYSTEM D BITCHEZ
Im winning!
Far as I am concerned you have every right to tell your fucking thieving corrupt politicians crony capitalist cocksuckers and all the fucking theiving bankers to fuck off, and personally consider it a moral duty to evade avoind and hide any and all income form such despicable bastards.
And any sanctimonious cunt from JPM coming out with shit like this deserves a nail gun applied to the back of his head
Don't hold back now. Tell us how you really feel!
LOL. Loved it. We always need to see the funny side of things.
damn right dude.
btc SPin On!!!
Regardless of how much smoke btc pumps blow up my ass, I cannot shift my perceptions to see worthwhile benefits of totally un-backed, network vulnerable, institution traceable, regime taxable, user vulnerable, ultimate fiat ponzi.
I'll take silver morgan's, you keep your propaganda backed crypto cyber crap. Think anyone is bribing a Ukraine checkpoint guard with btc???
And the slap on the wrist section of our government, settling for petty cash instead of long prison terms for these criminals"
(Reuters) - A whistleblower will be paid $63.9 million for providing tips that led to JPMorgan Chase & Co's agreement to pay $614 million and tighten oversight to resolve charges that it defrauded the government into insuring flawed home loans.
The payment to the whistleblower, Keith Edwards, was disclosed on Friday in a filing with the U.S. district court in Manhattan that formally ended the case.
In the February 4 settlement, JPMorgan admitted that for more than a decade it submitted thousands of mortgages for insurance by the Federal Housing Administration or the Department of Veterans Affairs that did not qualify for government guarantees.
JPMorgan also admitted that it had failed to tell the agencies that its own internal reviews had turned up problems.
The government said it ultimately had to cover millions of dollars of losses after some of the bank's loans went sour, resulting in evictions and foreclosures nationwide.
"There were a lot of bad loans made during the financial boom, and the United States taxpayer was left holding the bag through the VA and FHA loan programs," Edwards' lawyer, David Wasinger, said in a phone interview. "Hopefully the settlement sends a message to Wall Street that this conduct is not allowed, and that in the future it will be held accountable."
How does one properly measure a shadow economy's contribution to GDP? You really can't. GDP is measured by business reporting requirements. If activity is unreported, it is not measured.
Bullshit. JPM and bankers would love to see this succeed (and they will be well positioned to control all your virtual wealth). The underlying problem of fraud still remains. Until trust is restored, nothing changes.
The only thing that worries me is that JP Morgan might survive.
People won't pay taxes when they see the waste, the corruption, the cronyism, the favouritism built into their government system. Why should they?
These are all favourite libertarian topics. Libertarians don't by definition want no government, they want it minimised in order to make the waste, the corruption, the cronyism and the favouritism smaller.
This coming from someone who works for a company that continually skirts paying taxes via loopholes. Classic.
rubbish, if nobody paid taxes the state could fuck off and stop predating off us.
the reason we are poor is because the state taxed our excess wealth and pissed it away on boondoggles and war.
Of course JPM hates Bitcoin and I believe have already caused the mayhem behind Bitcoin's troubles. Bitcoin cuts into the margins of middelmen like JPM. Here is my speculation though. After it gets beaten down some more JPM will acquire it. If it cannot it will launch it's own JPM Coin while the U.S. government bans other competitors. While disgusting and unfair, all must render to Ceasar right now or incur the wrath. How much lobbying has Bitcoin done?
DUPE
." In other words, no one likes paying taxes, but when no one actually does pay them, everyone suffers"
WTF is this nonsense?
that's funny, i thought modern banking's use of of ballance-sheet shadow assets was a form of shadow economy. i think if you placed a blue dot on the graph to represent that, you'd there are a few major outliers there. shadow economy's are some of the wealthiest in the world !
Not so much the limits of libertarianism, but the limits of corrupt and burdensome government.
When it is almost impossible to do business honestly, it will be done under the table, as it is in most of the third world.
Simple flat taxation or sales taxation, together with less regulation, will bring more transactions and businesses out of the shadows, making surreptitious transfers less necessary.
Money which is actually tied to a real store of value will reduce the need for digital facsimiles of money.
BitCoin has the inherent flaw that it more closely resembles a penny stock with a cap on issuance, than it does a scarce commodity with intrinsic value. Without intrinsic value, it is subject to mood swings and bubbles - hey! Maybe I could sell Tulip certificates!?!
The conclusion makes no sense. Correlation is not causation. Both can have a common cause, which in this case they do.
Government control of the economy leads to black markets to supply the goods people want but the government control restricts or makes illegal. Government control of the economy leads to poverty due to limited economic opertunities and the political control of those opertunities. Thus when there is government control there will be black markets and poverty.
Bitcoin has already succeeded where devaluation & naked shorting could not. You can't stop taking people from taking delivery but they spend real money on 1200 bitcoins, by the time it hits 140, 106, and even 5.76 http://flic.kr/p/kyKgtF they are wiped out. Those people will not buy silver or gold and JP Morgan and the Fed become walking gods on Earth because you demanded they be so.