Bitcoin

• Turkish PM says tapes of talk with son a fabrication (Reuters) but opposition confirms authenticity, and national TV carriers cut parliament when played live
• Inside the Showdown Atop Pimco, the World's Biggest Bond Firm (WSJ)
• Ex-Jefferies Trader’s Customers Say Lies Common Tactic (BBG)
• Bitcoin exchange Mt. Gox disappears in blow to virtual currency (Reuters)
• The messenger mania is spreading: SoftBank Said to Seek Stake in Naver’s Line Messaging Unit (BBG)
• Ukraine Replaces Central Bank Head (BBG)
• Yup, an actual headline: Harsh weather tests optimism over U.S. economy (Reuters)
• Hiring of Law Grads Improves for Some (BBG)
• Easy Currency Bet Gets Harder as the Chinese Yuan Tumbles (WSJ)
• In Ukraine turbulence, a lad from Lviv becomes the toast of Kiev (Reuters)

UPDATE: Mt. Gox website and feed is now offline

Much as we are not surprised, given our previous discussion of the end of major Bitcoin exchange Mt. Gox, this evening's release by Coinbase must be the final nail in the final coffin of the Tokyo-based firm...

"The purpose of this document is to summarize a joint statement to the Bitcoin community regarding Mt.Gox. ... As with any new industry, there are certain bad actors that need to be weeded out, and that is what we are seeing today. "

And scene...

Since his historical track record has been spot on until now, we thought it useful to reflect on the wisdom of the maestro as he speaks this morning and his recent appearances. On the heels of the success of his un-best-selling book, Greenspan explains:

• *GREENSPAN SAYS 'NO DOUBT' BUBBLES ARISING IN CHINA'S ECONOMY
• *GREENSPAN SAYS OF BITCOIN: 'IT'S A BUBBLE'
• *GREENSPAN SAYS 'I DON'T SEE' SIGNS OF A BUBBLE IN STOCK MARKET
• *GREENSPAN SEES SIGNIFICANT RISE IN LONG-TERM RATES COMING

It appears he bubble-vision is strong and yet he notes that US income inequality is potentially harmful to the US political system and Dodd-Frank doesn't work; adding that the US needs 4% growth to fix itself.

In what appears yet another straw on the camel's back of Mt.Gox (following the re-freeze of account withdrawals), the Bitcoin Foundation this evening reported that:

"effective immediately, Mt. Gox has submitted their resignation from the board of directors."

Bitcoin prices on the dying exchange tumbled on the announcement after quite an extreme volatility day - which saw prices swing from $151 to $239 and then down to $190 on the news.

Just in case one was wondering for a reason not to take "Magic: The Gathering Online Exchange" too seriously, here is the latest news that has largely slammed the coffin shut on what was once the largest Bitcoin exchange.

• Facebook CEO Raises Dealmaker Profile With $19 Billion Takeover (BBG)
• WhatsApp’s Founder Goes From Food Stamps to Billionaire (BBG)
• U.S. Feels Putin's Sharp Elbows in Ukraine (WSJ)
• PBOC Drains Cash as Overnight Rate Slides to Lowest in 10 Months (BBG)
• Fed Puts Rate Increase on the Radar (Hilsenrath)
• Banks Flouting Bonus Rules in Denmark Set to Be Named by FSA (BBG)
• Work Set to Resume on Upgrading Panama Canal (WSJ)
• Euro-Area Recovery Loses Pace as Manufacturing Weakens (BBG) - uh, what recovery?
• Ukraine Exposes EU Policy Disarray (WSJ)

• Carl Icahn wins again: Actavis to Buy Forest Labs for $25 Billion (WSJ)
• ECB governing council member attacks German court ruling on OMT (FT)
• China Tackles $1 Trillion Data Gap as Xi Changes Metrics (BBG)
• FX Traders Facing Extinction as Computers Replace Humans (BBG)
• BOJ Boost to Loan Programs Signals Room for More Easing (BBG) - actually no it doesn't as it was "factored in"
• Four killed in Thai clashes; PM to face charges over rice scheme (Reuters)
• Goodbye unsterilized SMP: Bundesbank Backs Measure to Boost Funds in Banking System  (WSJ)
• Iranian Hacking to Test NSA Nominee Michael Rogers (WSJ)
• Ukraine Clashes Leave Dozens Wounded as Putin Resumes Bailout (BBG)

While correlation is not causation, the coincidental timing of the tumble in virtual currencies and the surge in physical (alternative) currencies suggests another great rotation may be occurring... with gold at fresh 3-month highs (and Silve rup 16% in February alone) as Bitcoin presses 3-months lows...

The ongoing exodus from Mt.Gox - a major Bitcoin exchange - amid withdrawal halts, has seen a massive $150 spread open up between it and other exchanges. Having tumbled by over 50% in the last 2 weeks, Mt. Gox pricing is back at levels first seen 3 months ago. This chaos (and the ongoing 'finger-pointing' over who is to blame) had led Mt.Gox CEO Mark Karpeles to come out swinging in the following interview...

I crush the JP Morgan Managing Director and Head of FX, John Normand, and his false-factual rant against Bitcoin. Fear, envy & loathing in seeing your bonus floating margin at cryptocurrency risk!

• Comcast Agrees to Buy Time Warner Cable for $45.2 Billion (BBG)
• Italian leadership squabble weighs as shares halt hot run (Reuters)
• Russia says Syria aid draft could open door to military action (Reuters)
• China trust assets rise 46% in 2013  (WSJ), China Trust Assets Surge to $1.8 Trillion Amid Default Risks  (BBG)
• Australian Unemployment Jumps to 10-Year High (BBG)
• Tea Party Scorns Republicans as House Lifts Debt Ceiling (BBG)
• Peso plunge forces Argentine soya hoarding (FT)
• BNP Paribas Net Falls After $1.1 Billion U.S. Legal Charge (BBG)
• Hacking Joins Curriculum as Businesses Seek Cyber Skills (BBG)
• Android's 'Open' System Has Limits (WSJ)
• Blackstone-Fueled Single-Family Home Boom Lifts Chicago (BBG)

For the first time ever, the majority of Americans are scared of their own federal government. A Pew Research poll found that 53% of Americans think the government threatens their personal rights and freedoms. Americans aren't wild about the government's currency either. Instead of holding dollars and other financial assets, investors are storing wealth in art, wine, and antique cars. The Economist reported in November, "This buying binge… is growing distrust of financial assets." Every central banker on earth has sworn an oath to Keynesian money creation, yet the yellow metal has retraced nearly $700 from its $1,895 high. The only limits to fiat money creation are the imagination of central bankers and the willingness of commercial bankers to lend. That being the case, the main culprit for gold's lackluster performance over the past two years is something else... It won't be inflation that drives up the gold price but the unwinding of massive amounts of leverage.

In less than 30-seconds, the always eloquent founder of the Interest Rate Observer 'translates' Yellen's Fed speak into reality:-

"What we mean to do is continue to nationalize the yield curve... and we would like to enlist the stock market in a program of wealth creation for the security holders of America."

The Fed has manipulated interest rates for 100 years but Grant adds, "never - until now - has it manipulated the stock market as if it were a lever of public policy." His discussion ranges from the bubble in Biotech to holding Gold (which he describes as "nature's bitcoin") because it is "the reciprocal of faith in Central Banks."

As the torch of responsibility is rapidly handed off from exchange to exchange to the Bitcoin source code, Gavin Andersen (one of Bitcoin's protocol core developers) explains just what is going on - and what it means for the 'wealth' stored in the virtual currency - "Users of the reference implementation who are bitten by this bug may see their bitcoins “tied up” in unconfirmed transactions" - so that's what 'bit' stands for in bitcoin...

Bitcoin plunged another 15% or so from its bounce highs this morning as volatility has picked up dramatically in the virtual currency. The reasons are numerous: JPMorgan has come out with a scathing attack - "bitcoin looks like an innovation worth limiting exposure to;" CoinDesk reports that major exchanges are under a "massive and concerted attack" by a bot system - creating a "fog of confusion" over the system; and perhaps most critically, BitStamp has followed Mt.Gox and halted withdrawals "due to inconsistent results from their bitcoin wallet" - due to the DDoS attacks...