The Future of Bitcoin

The latest guidance from US Leviathan’s Financial Crimes Enforcement Network (FinCEN) is a leaf ripped straight out of Moldbuggian prophecy. The target acquisition revealed in Administrators and Exchangers of Virtual Currency, section c. De-Centralized Virtual Currencies could not possibly be clearer:

A final type of convertible virtual currency activity involves a de-centralized convertible virtual currency (1) that has no central repository and no single administrator, and (2) that persons may obtain by their own computing or manufacturing effort.

A person that creates units of this convertible virtual currency and uses it to purchase real or virtual goods and services is a user of the convertible virtual currency and not subject to regulation as a money transmitter. By contrast, a person that creates units of convertible virtual currency and sells those units to another person for real currency or its equivalent is engaged in transmission to another location and is a money transmitter. In addition, a person is an exchanger and a money transmitter if the person accepts such de-centralized convertible virtual currency from one person and transmits it to another person as part of the acceptance and transfer of currency, funds, or other value that substitutes for currency.

[See Fotrkd’s link feast in this comment thread]

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March 20, 2013admin 26 Comments »
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What is Intelligence?

The general cognitive factor (g), measured by IQ tests, quantifies intelligence within the human range, but it does nothing to tell us what it is. Rather, a practical understanding of intelligence — as problem-solving ability — has to be assumed, in order to test it.

The idea of intelligence, more abstractly, applies far beyond IQ testing, to a wide variety of natural, technical, and institutional systems, from biology, through ecological and economic arrangements, to robotics. In each case, intelligence solves problems, by guiding behavior to produce local extropy. It is indicated by the avoidance of probable outcomes, which is equivalent to the construction of information.

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March 19, 2013admin 26 Comments »
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In other news …

Embarrassed History Channel apologizes to “deeply hurt” Satanist community.
(Via Glenn Reynolds)

March 18, 2013admin No Comments »
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Pattern Recognition

There has been enough productive history to know what functional social systems look like, and the basic common factor is obvious. Institutions advance by substituting for trust.

(To the extent we still have any of these things …)
— We have market capitalism because businesspeople can’t be trusted.
— We have experimental science because neither truth intuitions nor scientists can be trusted.
— We have constitutional republicanism because neither political leaders nor the citizenry can be trusted.
— We have freedom of conscience because priests can’t be trusted.
— We have common law because neither legislators nor judges can be trusted.
— We have the blogosphere because the media can’t be trusted.
— We have gold coins buried in the garden because bankers can’t be trusted.
— We have basements packed with semi-automatic rifles because state law enforcement can’t be trusted.

Siding with intelligence has nothing at all to do with trusting, liking, or respecting intelligent people. It is intelligent people, typically, who run the engines of stupidity. ‘Trust, but
verify
‘ is politely euphemistic, and — in truth — wholly inadequate. Distrust, and test, test, test … to destruction wherever possible.

Three theses:
(1) The robust sophistication (or design quality) of any society or social institution is inversely proportional to the the trust it demands. This is not, of course, to be confused with the trust it earns.
(2) In any society capable of institution building, distrust is the principal driver of innovation. Systematization and automation, in general, incarnate distrust.
(3) Productive distrust reaches its apotheosis in the Internet, which routes around everything and everybody that has ever been believed.

March 18, 2013admin 8 Comments »
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Reaction Points (#2)

Spandrell has been asking whether advanced modernity makes an ever larger fraction of society economically redundant. Jim has also been talking about the costs posed by “people of negative economic value” (or, with his signature delicacy, ‘the moron problem’.) It’s a running theme with Moldbug too, and he’s now gone epic on it.
Outside in is Austrian enough to predict that markets clear when they’re not politically screwed over, which would mean the problem isn’t techno-economic at all, but merely one of inequality tolerance. It seems that Federico agrees.

Foseti has been shepherding people towards Scott Alexander’s series on Reaction. The dubiously named ‘thrive/survive’ theory in part two is (really) interesting, but is there anything else going on there worth responding to? Attempts at persuasion welcome.

Most intense mind-meld moment of the week (Jim again):

… obviously China has been moving rightwards ever since the Gang of Four was overthrown, and will probably continue to do so, but they feel really guilty about doing so.

Nineteenth century anglosphere capitalism survived in Shanghai till 1941, long after it had become extinct in the anglosphere, and to some extent survived in Hong Kong to the present day. After the coup, Deng set to work reviving Shanghai capitalism before the show trial of the gang of four had even began, and in this sense, China has become deeply reactionary, preserving some of the best of the west’s past. On the other hand, in another sense they are still a bunch of commies kowtowing to elite white male leftists.

Can China fend off the Cathedral? The future depends on that. Either the CPC goes global PC, or reaction deepens all the way to total recall (that laissez-faire is the translation of a Chinese concept). Here’s one positive indicator. (And a negative one.)

March 18, 2013admin 10 Comments »
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Alexander on Reaction

Foseti was persuasive enough to motivate a second look at Scott Alexander’s continuing engagement with reaction (even after the dismally unimpressive first installment).

It is indeed “awesome,” and merits a serious response (later this week?).

For an immediate response, simple translation has to suffice, stripping away the slanted “survive/thrive” language, and getting right to the point. Reactionaries think leftists are spoiled*: decadent, self-indulgent, hedonistic fantasists, debauching an inheritance they are incapable of adding to.

Degeneracy is degeneracy**, whether it’s affordable or not. To the reactionary right it looks horrible, even in the absence of zombie apocalypse (but we’re getting one anyway).

* How can a theory of left/right differentiation demonstrate such insensitive disregard for ‘the wretched of the earth’? It is that ‘problem’ — readily admitted by Alexander — that makes his explanation truly awesome. The Left has nothing to do with what the downtrodden ‘think’, and everyone — once pressed — is relieved to admit that. Now everything makes sense. We’re discussing a thought-pattern (Leftism) exclusively native to affluent degenerates, with the social sub-strata occasionally latching on, opportunistically, and uncomprehendingly.

** Yes, the word ‘degeneracy’ is historically spicy — if we were being responsible about it, it would make us nervous. Slicing diagonally through biology, culture, economics — even technology — it’s what reactionaries think socio-political ‘progress’ really is. In that respect, it’s indispensable.
So what is degeneration? — in any conversation entirely internal to reaction, that would be the central topic of discussion. (The Outside in definition: degeneracy is whatever makes you more stupid.)

ADDED: Scott Alexander paraphrased: The Right doesn’t think we can afford to degenerate, whilst the Left thinks we can.
Scott Alexander nudged: The Right decries degeneration, even when it seems (in the short term) affordable. The Left advocates degeneration (in the medium term) even when, in the short term, we obviously can’t afford it.

ADDED: ‘Survive vs thrive’ or Crunchy vs Soggy (via Glenn Reynolds)?

ADDED: Goad on fire viz affluent degenerates (via SDL in the comments).

March 17, 2013admin 2 Comments »
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Optimize for Intelligence

Moldbug’s latest contains a lot to think about, and to argue with. It seems a little lost to me (perhaps Spandrell is right).

The guiding thread is utility, in its technical (philosophical and economic) sense, grasped as the general indicator of a civilization in crisis. Utilitarianism, after all, is precisely ‘objective’ hedonism, the promotion of pleasure as the master-key to value. As philosophy, this is pure decadence. As economics it is more defensible, certainly when restricted to its descriptive usage (if economists find their field of investigation populated by hedonically-controlled mammals, it is hardly blameworthy of them to acknowledge the fact). In this respect, accusing the Austrians of ‘pig-philosophy’ is rhetorical over-reach — swinish behavior wasn’t learned from Human Action.

Utilitarianism is often attractive to rational people, because it seems so rational. The imperative to maximize pleasure and minimize pain goes with the grain of what biology and culture already says: pleasure is good, suffering is bad, people seek rewards and avoid punishments, happiness is self-justifying. Calculative consequentialism is vastly superior to deontology. Yet the venerable critique Moldbug taps into, and extends, is truly devastating. The utilitarian road leads inexorably to wire-head auto-orgasmatization, and the consummate implosion of purpose. Pleasure is a trap. Any society obsessed with it is already over.

Utility, backed by pleasure, is toxic waste, but that doesn’t mean there’s any need to junk the machinery of utilitarian calculus — including all traditions of rigorous economics. It suffices to switch the normative variable, or target of optimization, replacing pleasure with intelligence. Is something worth doing? Only if it grows intelligence. If it makes things more stupid, it certainly isn’t.

There are innumerable objections that might flood in at this point [excellent!].
— Even if rigorous economics is in fact the study of intelligenic (or catallactic) distributions, doesn’t the assumption of subjective utility-maximization provide the most reliable basis for any understanding of economic behavior?
— Infinite intelligence already (and eternally) exists, we should focus on praying to that.
— Rather my retarded cousin than an intelligent alien.
— Do we even know what intelligence is?
— Cannot an agent be super-intelligent and evil?
— Just: Why?

More, therefore, to come …

ADDED: A previous excursion into the engrossing topic of hedonic implosion cited Geoffrey Miller (in Seed magazine): “I suspect that a certain period of fitness-faking narcissism is inevitable after any intelligent life evolves. This is the Great Temptation for any technological species—to shape their subjective reality to provide the cues of survival and reproductive success without the substance. Most bright alien species probably go extinct gradually, allocating more time and resources to their pleasures, and less to their children. They eventually die out when the game behind all games — the Game of Life — says ‘Game Over; you are out of lives and you forgot to reproduce.’”

March 15, 2013admin 16 Comments »
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Yum!

Tasty chick pix at Urban Undercurrents.

ADDED: Smoking hot

March 11, 2013admin 12 Comments »
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The Feel-Good Franchise

Sheldon Richman seizes upon the senseless sequester squealing as an opportunity to make more general points (via Cafe Hayek). There’s nothing strikingly original, but it’s all impressively sound. The point of departure is Bryan Caplan’s analysis, which Richman summarizes as the question: “…if the ‘informed voter’ is a chimera, how can we expect democracy to yield desirable outcomes?”

Since democratic large numbers drown out both the effectiveness of any vote, and the private consequences of subsequent policy …

… it’s costless to vote for the candidate who makes you feel good about yourself. As Bryan Caplan has shown, given these incentives, people tend to vote according to their biases, which for most people embody economic fallacies.

Yet the keepers of the system (pundits included) play a game in which they pretend that voters are informed and make wise decisions.

Common rhapsodizing about democracy notwithstanding, the details of what Leviathan does are beyond comprehension. (Remember, members of Congress don’t read the bills.) Even an enthusiast for big government can’t tell if this government’s policies do good or harm. Yet the cult of democracy aims at maximum participation in elections. If a small number of ignorant voters is not good, how can a larger number be an improvement?

Here’s a better idea: let people cooperate with one another in the free market, and leave as few matters as possible to the overrated democratic arena.

Good luck with that.

March 11, 2013admin 16 Comments »
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“The truth is kind of a dark thing”

Tortured liberal Robert Huber writes on the race-crushed culture of Philadelphia (via Sailer), vividly describing people psychological broken and warped by fear — the author, of course, among them.

I yearn for much more: that I could feel the freedom to speak to my African-American neighbors about, say, not only my concerns for my son’s safety living around Temple, but how the inner city needs to get its act together. That I could take the leap of talking about something that might seem to be about race with black people.

I wouldn’t do that, though, because it feels too risky. …

But this is how I see it: We need to bridge the conversational divide so that there are no longer two private dialogues in Philadelphia — white people talking to other whites, and black people to blacks — but a city in which it is okay to speak openly about race. That feels like a lot to ask, a leap of faith for everyone. It also seems like the only place to go, the necessary next step.

Meanwhile, when I drive through North Philly to visit my son, I continue to feel both profoundly sad and a blind desire to escape.

Though I wonder: Am I allowed to say even that?

(No.)

ADDED: Not a tortured white liberal. “Both the Progressives at the beginning of the 20th century and the liberals at the end started from the same false premise — namely, that there is something unusual about different racial and ethnic groups having different achievements.”

March 8, 2013admin 37 Comments »
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