Bitcoin

Zero Hedge users mostly agree the financial system will implode.  It doesn't take more than high school math skills to calculate that the current debt based money system has implosion built in, and it's guaranteed (this is one rare case we can use such a word in finance!), because at some point, not enough new money can be created to pay off an ever increasing debt base.  Collapse is a mathematical certainty.

Hot on the heels of JPMorgan's "web cash" developments in the virtual currency arena, the CEO of Russia largest bank - Sberbank - appears to be looking for alternatives...

• *SBERBANK CEO GREF SAYS FUTURE BELONGS TO VIRTUAL CURRENCIES
• *GREF SAYS DEVELOPMENT OF VIRTUAL CURRENCIES 'CAN'T BE STOPPED'
• *SBERBANK CEO CALLS FOR GREATER REGULATION OF VIRTUAL CURRENCIES
• *SBERBANK MAY FORM OWN VIRTUAL CURRENCY ON BASIS OF YANDEX MONEY

When a pseudonymous 'Japanese' coder creates a crypto-currency that gains acceptance among thousands of vendors, it's dismissed by the powers-that-be and called a ponzi scheme by the MSM. One wonders what happens when the largest banks of the US and Russia sanction the 'idea' of a decentralized, unregulated, 'money' transfer system.

• Presidential Task Force Recommends Overhaul of NSA Surveillance Tactics (WSJ)
• Monte Paschi's Largest Shareholder Says It Will Vote Against $4.1 Billion Capital Increase (WSJ)
• SAC Reconsiders Industry Relationships—and Its Name (WSJ)
• Icahn’s Apple Push Criticized by Calpers as ‘Johnny Come Lately’  (BBG)
• In Yemen, al Qaeda gains sympathy amid U.S. drone strikes (Reuters)
• Missing American in Iran was on unapproved mission (AP)
• In China, Western Companies Cut Jobs as Growth Ebbs (WSJ)
• U.S. lays out steps to smooth Obamacare coverage for January (Reuters)
• Las Vegas Sands Said to Drop $35 Billion Spanish Casino Proposal (BBG)
• Twitter Reverts Changes To Blocking Functionality After Strong Negative User Feedback (TechCrunch)

Meet Mike Caldwell. He is the maker of what seems to be the most popular physical bitcoins on the market, the Casascius coin. All Mr. Caldwell does is have people who want the coins produced send him a certain quantity of bitcoin and then for a $50 fee he puts the private key on a physical coin and sends them back. For this horrible crime of ingenuity and creativity, the U.S. government naturally, has decided to target him. Because they are too busy ignoring the real financial crimes happening out out there…

Following what we can only imagine was uproar following our discussion of Fidelity "allowing self-directed IRA holders to 'invest' in Bitcoin," the company has very quickly reversed policy... As MarketWatch notes,

“On an individual basis, we allowed an investor to invest in that Bitcoin Investment Trust,” said Rob Beauregard, director of public relations at Fidelity, in a telephone interview Thursday morning. “We are no longer allowing that.”

The firm is not commenting on why that was allowed, and added "reviews are going on."

Haters gonna hate, but the “Bitcoin bubble” meme has become the financial equivalent of a viral online cat video – wildly popular but pretty vacuous. In an effort to separate fact from fiction, ConvergEx's Nick Colas reviews 11 bitcoin myths (and dispels them). Still, there’s no doubt that the public is entranced: there are now 3x more Google searches for “bitcoin” than “Western Union”, and 33x more than for “Gold coins”.  We started writing about bitcoin back in February because it was – and still is – a fascinating invention (for better or worse). How it plays out, we will just have to wait and see.

We are sure this will all end well... but as Marketwatch reports, Fidelity has partnered with SecondMarket’s Bitcoin Investment Trust to allow its clients to save for their retirement by putting the virtual currency in self-directed IRAs.

In the 1st installment of this article – May the Odds Ever Be in Your Favor – The Reaping, we addressed how wealth inequality created by men rigging the system and utilizing media propaganda ultimately leads to rebellion. In Part 2, we will show how hope and defiance can ignite the flame of liberty in the minds of men. Edward Snowden has ignited that flame.  A Lot of Hope is Dangerous... Linear thinking old timers are likely to scoff at the notion that some trilogy of novels for teenagers could capture the mood of the time in a way that explains how the people of this country will respond to the current worsening Crisis. History is cyclical and we’ve returned to a time where leaders will step forward to lead and brave heroes step forward to fight. The future of the country hangs in the balance.

• Wall Street Exhales as Volcker Rule Seen Sparing Market-Making (Bloomberg)
• GM to End Manufacturing Down Under, Citing Costs (WSJ)
• U.S. budget deal could usher in new era of cooperation (Reuters)
• Ukraine Police Back Off After Failing to Stop Protest (WSJ)
• First Walmart, now Costco misses (AP)
• Dan Fuss Joins Bill Gross Shunning Long-Term Debt Before Taper (BBG)
• China New Yuan Loans Higher Than Expected (WSJ)
• China bitcoin arbitrage ends as traders work around capital controls (Reuters)
• Blackstone’s Hilton Joins Ranks of Biggest Deal Paydays (BBG)

We’ve spent the last five decades learning to love our oppression, adoring our technology, glorying in our distaste for reading books, and wilfully embracing our ignorance. Huxley’s vision of a population, passively sleep walking through lives of self- absorption, triviality, drug induced gratification, materialism and irrelevance has come to pass. Only in the last two decades has Orwell’s darker vision of oppression, fear, surveillance, hate and intimidation begun to be implemented by the ruling class. We’ve become a people controlled by pleasure and pain, utilized in varying degrees by those in power. Stay tuned for our modern day Hunger Games after this commercial for your very own Duck Dynasty Chia Pet.

It’s always astonishing how funerals and memorial services can do two things to people. They make platform for public show and then they provide the opportunity for public speaking that knows no bounds in the hope that they will be remembered for eternity.

Much has been said about Bitcoin: an alternative currency; a "honeypot" scheme by the central banks and Feds to capture excess cash, punish the rebellious and track abusers of money laundering laws; a revolution against fiat. Perhaps one other word may be used as well: "distraction"?

If you can't beat 'em, join 'em, copy 'em, and then beat 'em. While everyone's attention has been glued to Bitcoin (and its various smaller and less viable for now alternative digital currencies), JPMorgan has submitted a patent which appears to set the scene for a competing centralized network to Bitcoin. As LetsTalkBitcoin noted first, the "Method and system for processing internet payments using the electronic funds transfer network," states that Chase's technology is a "new paradigm." Moreover that it permits the creation of "virtual cash" (also referred to as "web cash") with a "real-time digital exchange of value." Without naming the virtual currency or any competing payments system by name, the bank takes a swipe at the crytocurrency model, adding that sees “a new marketplace” emerging for “low dollar, high volume, real-time payments with payment surety for both consumers and producers.”

• U.S. set to adopt Volcker rule to curb bank trading gambles (Reuters) After vote, lawsuits likely next hurdle for Volcker rule (Reuters)
• U.S. Congress budget talks could produce Tuesday deal, aides say (Reuters)
• Wealthy Go Frugal This Holiday Amid Uneven U.S. Recovery (BBG)
• Tearful Thai PM urges protesters to take part in election (Reuters)
• Fed’s Bullard Sees Higher QE Taper Odds as Labor Market Improves (BBG)
• Coeure Says ECB Would Offer More LTROs Only When Banks Can Lend (BBG)
• Inside China's Super-Sterile Chicken Farms (WSJ)
• Mandela Service Rivals JFK’s as Leaders Meet in South Africa (BBG)
• China data defy slowdown forecasts (FT), and of course the word is "data"
• Cold, ice grip U.S. as more snow to blanket East (Reuters)