The Fifth Paradigm?

comppdgm

There’s a complete lack of theoretic elegance — or even basic structure — to this, but it still strikes me as basically right.

The image is over two years old. but I’ve only just seen it (via). The text pinned to it is from February this year, and also makes a solid forecast. The basic direction of capital teleology hasn’t been this pronounced for a century (at least).

September 17, 2016admin 104 Comments »
FILED UNDER :Technology

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104 Responses to this entry

  • Etiq Says:

    Are there any in-depth Nrx writings on Bitcoin? That is, what level of adoption is likely and what effect this adoption could have on the political order. A few years ago I read a lot of posts from Bitcoiners and Ancaps fantasising about a Bitcoin take-off ‘starving the beast’ by nullifying state control over money and enabling widespread and unstoppable tax evasion (like internet piracy is widespread and unstoppable). Certainly that would be fun but it didn’t seem too realistic to me at the time, and lately Bitcoin seems to have stalled a bit.

    [Reply]

    Mark Warburton Reply:

    Admin is writing a book on it. By the time it’s out I expect they’ll be a 6th paradigm… ;P

    [Reply]

    Xoth Reply:

    I don’t think a ledger that tracks and persists all transactions is a suitable vehicle for nullifying state control or tax evasion. Quite the opposite.

    The five computing paradigms above could better be seen as successively increasing control and monitoring of individuals. The big leap was of course the smart phone personal surveillance device (and social networking, if we want to go on the software track). If you want to continue on the hardware track, don’t forget the Internet of Things, which will provide another technological leap in this respect; I would expect there to be a great deal of simultaneous research on scaling up big data and machine learning techniques to handle dozens or hundreds of devices and sensors per individual. This will probably have benevolent side effects for efficiently managing individuals too.

    The brief epoch of giddy hacker libertarianism in the 90s was in retrospect just a fluke.

    [Reply]

    michael Reply:

    which is why techno futurism exit is a fantasy the cathedral wil always have the best tech first and have thought of the possibilities first or at least have the ability to shut doors in time.

    [Reply]

    Posted on September 17th, 2016 at 1:12 pm Reply | Quote
  • michael Says:

    Desk Set was 1957, I got my trs80 at a radio shack on 14st in 78 and was imediately able to take classes at the new school so i dont remember it seeming that cutting edge by the late 70s maybe nyc was ahead of the curve. I would maybe push back mainframes and pcs a decade and put video games and graphic interfaces in the 80s.in a way they were what really woke many up to the possibilities.

    [Reply]

    Posted on September 17th, 2016 at 1:29 pm Reply | Quote
  • Cryptogenic Says:

    What comes after Moore’s law ceases to hold true, which it has? Everything seems stalled right now.

    [Reply]

    Posted on September 17th, 2016 at 1:42 pm Reply | Quote
  • Brett Stevens Says:

    @michael

    This chart refers to when they became popularized/normed. Technically, the first four belong in the 1960s.

    [Reply]

    michael Reply:

    I know im just saying a popular movie and not the earliest or only of its type portrayed a small publishing house library installing a mainframe in 57, I had my first car phone in 92 and my first computer in 78 neither was i really such a rarity.but i quibble i suppose

    [Reply]

    ihatebuzzwords Reply:

    The chart is void of content. There has not been a paradigmatic shift in computing since the second World War.

    [Reply]

    admin Reply:

    Distributed computing is definitely a paradigm shift. Agree that trying to pack four such changes into as many decades tends to dilute the word beyond usefulness.

    (If distributed computing doesn’t rise to the level of a ‘paradigm shift’ there hasn’t been one since the Scottish Enlightenment — which is also arguable, if perhaps excessively austere.)

    [Reply]

    Posted on September 17th, 2016 at 2:33 pm Reply | Quote
  • michael Says:

    i dont see btc as a good example of 5 gen i think if you look at the others whats happening is at first its an extension of ourselves a main frame just a big calculator a bookkeeper for an organization,

    but then its made small and cheap enough to be put to work on projects maybe only one person is interested in with the PC if the person is interested enough he can program it to do novel things and these novelties can be improved upon the calculators vocabulary grows,

    then its connected to the telephone system so others with similar interests can coordinate work on obscure projects with the PC and more quickly expand its vocabulary,which sort of gives it the power of the mainframe and its organization with the cost and flexibility of the PC.

    social mobile is in a way making it cheaper and more ubiquitous certainly the third world and first world proletariat gets online. but more important its about sensors that feed the pcs and mainframes or rather their modern equivalents through the web and eventually simply into the web.which simultaneously makes it a sort of hive mind but also no longer a machine its ambulatory it can see hear speak measure almost anywhere the problems becomes not finding ways to give it entry to the real world but to keep it out.Its no longer working on a project but has the information constantly gathered for any possible project.its infinite real time data and not really data anymore its the whole thing is what its real advance is

    bit coin i dont see how this is a leap of much significance trade is already taking place many ways area available to assure trust btc seems like a bad way yo create a currency and a clunky way to do bookkeeping. If btc hard turned out to be a replacement for all the worlds fiat currencies that would have been tremendous but still sort of a side story. I suspect there will eventually be a world currency above fiats which may or may not continue alongside but not of the current ilk.

    the next step is going to be sorting out the mess and improving all the previous steps, mobile becomes more ubiquitous sensors on everything and hooked into us biologically the wireless speed and capacity made as great as hard wire, the information made more accessible usable the noise filtered the connections filled in with intelligent interfaces any question i want answered i can get how many men with iphones in this area have just bought a latte and also subscribe to the economist have travelled to asia in the past week.what is their temperature heart rate email address.This level of accurate information makes assertions testable in real time historically and into the future.it also makes lying much harder. it makes irrational behavior harder it makes bluffing power harder.

    [Reply]

    Posted on September 17th, 2016 at 2:54 pm Reply | Quote
  • Kgaard Says:

    Well … The leap to Bitcoin strikes me as odd. I have been in finance my whole adult life and think about markets 12 hours a day. Talk to people about same. Bitcoin is simply not on the radar. All monetary focus is on central bank policies. Now … it’s entirely possible that blockchain technologies will someday transcend/displace money as we know it, but from my perspective we are not even close to this point. The most BASIC issues with Bitcoin have not been solved:

    * How do you go about not losing your BTC when your computer dies or your exchange does a Mt. Gox?
    * Who is charged with keeping the value of BTC stable?
    * Why should a govt take BTC as tax payment or as payment for government bonds?

    [Reply]

    Kwisatz Haderach Reply:

    “How do you go about not losing your BTC when your computer dies or your exchange does a Mt. Gox?”

    How do you go about not losing your paper cash when you lose your wallet or get mugged or the federal bank debauches the currency into toilet paper? BTC only participates in two of these three distinct risks. Cryptocurrencies are bearer instruments, where the instrument in question is a digital memory device instead of a piece of paper or piece of metal or shell bead. BTC is in fact easier to store safely, since multiple copies of the keys which confer ownership can be cheaply and secretly stored in many locations simultaneously.

    “I have been in finance my whole adult life and think about markets 12 hours a day. Talk to people about same. …Who is charged with keeping the value of BTC stable?”

    You’re so deep in the matrix that you don’t even think that the idea of fiscal policy per se is degenerate.

    “Why should a govt take BTC as tax payment or as payment for government bonds?”

    Government’s won’t accept hard currencies as long as they are able to profit by not accepting hard currencies. To predict the future it’s best to think of government as a service on a market, where microecon applies. The price of the government service tends towards its marginal cost. Governments can still be profitable without the rent of seigniorage, and so eventually some government on the margin will experiment with accepting alternative currencies. It will be some government that already doesn’t gain much from the power of seigniorage, like Estonia or Venezuela. Competition will drive other governments to do the same. The major players with the most to lose and the most power to extract seigniorage rents will be the last to fall in line.

    [Reply]

    Kgaard Reply:

    Okay these answers are reasonable. I think you still need a de facto central banker charged with keeping the value of the currency stable — and then the question would be “stable relative to what?” You can’t have Bitcoin whipping around by several hundred dollars per coin and have it be a legit currency.

    I was going to say that it seems you’d need a pretty high IQ to be able to deal with the idea of having keys to your bitcoin that can be applied across multiple platforms. But as I think about it, this is really akin to having a Facebook password that you use across multiple platforms. Africans pay their bills on their phones and that’s already getting pretty close to the Bitcoin concept.

    Also i think you mean “monetary policy” is degenerate.

    [Reply]

    Xoth Reply:

    Regarding stable value, I would say the central bank is more into a forced landing. As we recall, the dollar has dropped about 95% in value since going off the gold standard. We have all these currencies with inflation targets (loss of value) in good times, and currency wars in bad times. Their values only seem stable when compared to other fiat currencies, also descending. The value stored by a fiat currency is, in the end, at rest, once the noise dies down, zero.

    Note that what we have now is basically an ad hoc quasi-bitcoin electronic currency managed/”mined” by a few hundred of the government’s best friends, mostly mere data but with a small number of barbarous paper notes still in circulation for legacy purposes.

    I wouldn’t be surprised to see a managed block chain currency replace the current one, because it enables further control of the users. No more anonymous paper notes changing hands. Bitcoin per se seems too slow to be universally used in the real economy, but you could probably optimise things quite a bit by instead having a trusted set of core banks maintaining the ledger for free, just as table stakes for playing the great game.

    michael Reply:

    the ability to make copis is a bit dubious it also means others can copy and use you btc if they find it physically or digitally and you wont even know its gone until you use it. Its also a cumbersome copy and still takes a bit of knowhow you can teach a monkey to trade fiat for bananas. The ideas to streamline these and other problem create their own problems including stripping away btc benefits.one advantage of fiat is its defended by people with common interests in it but they also defend your fiat. my CC co bank even the police will investigate theft insure or otherwise give me recourse. these are certainly not without downsides is it possible to maintain privacy liquidity security usability safety scalability and stability? can some program or entity do all that in a fool proof way quantum computing?that is what btc pretends to but is not there yet
    . if it were some of these self solve a BTc that was all that would be the fiat benchmark would be stable, relative fluctuations would be viewed as instability in a given fiat not in btc, at least so little mind imagines but im no economist what happens to smaller economies like the ones in the euro where the velocity was slower. and govt debt would be interesting it would be instantly is monetized the right concept. im not at all clear on this and am not going to figure it out but it would be more than simply say down grading fiat as it took on debt and would central banks buy btc would btc shorts and future create btc fiat would some nations do away with fiat. is fiat a share in a nation subordinate to the nations bondholders. I think its better to solve the fiat problem separately no representation without taxation including no spending by debt then btc becomes more a tech issue.

    [Reply]

    Kwisatz Haderach Reply:

    BTC wasn’t designed to give anonymity and it doesn’t. But nothing else does either, and the system as currently implemented already yields scarcity, divisibility, portability, indestructibility, and homogeneity.

    “The fiat problem”. A first to step solving the fiat problem is to describe what that problem really is. What the problem really is that a single agent can unilaterally decide to create more fiat money through whatever mechanism created the original fiat money. Only systems which structurally prevent an agent from creating more money are able to solve the fiat problem. Any system based on trusting any agent degenerates into the same situation we have now. (Of course, having a real money system doesn’t automatically prevent us from falling back into the current degenerate situation either. After all, humans had real money through most of history. So a separate account of how we got here and how we can stop from getting back here once we dig ourselves out is required).

    If you want to envision a future of Bitcoin, stop thinking about how Bitcoin works. You don’t have to understand how Bitcoin works in order to use it. Does everyone understand how credit card processing works? No. Not only could most people not code a credit card transaction system, most people don’t even understand how credit card transacations are processed in principle, nor do they care to. (For that matter, I don’t really understand it, but I am making a note to go read something about it for future reference).

    For most people, here is how credit cards work: you get a plastic card in the mail and you swipe it on the machine, wait five seconds and sign the receipt. Later you go home and log in to your bank’s website and check your balance.

    Bitcoins could easily be put on a credit card-like chip and work exactly the same way, to the end user, that credit cards or Apple Pay work today. The only difference is that when you check your balance it’s denominated in BTC instead of USD.

    grey enlightenment Reply:

    bitcoin is stable because i’ts a store of value

    To avoid losing your coins, use a paper wallet, make multiple wallets. never store your coins on an exchange.

    [Reply]

    Posted on September 17th, 2016 at 3:06 pm Reply | Quote
  • Zippy Says:

    Bitcoin is simply an authenicated record of wasted computation, it is not a security or financial option which entitles the bearer/owner to anything in particular. Its intrinsic value is therefore approximately equivalent to the value of an authenticated photograph of someone doing something stupid:

    https://zippycatholic.wordpress.com/2015/10/29/where-the-value-of-money-comes-from/

    [Reply]

    admin Reply:

    Feature, not bug.

    [Reply]

    Zippy Reply:

    Feature if self delusion is the goal:

    https://zippycatholic.wordpress.com/2015/10/29/valuing-nothingness/

    [Reply]

    admin Reply:

    It’s a bet that will be historically tested.

    frank Reply:

    Your definition of “entitlement” reduces to promises. “Fiat currency entitles you to settlement of taxes in that currency” -> government promises to accept fiat currency. “Gold backed government currency entitles you to a fixed amount of gold” -> government promises to pay you in gold.

    The exact same principle is in action in the case of bitcoin. When you use bitcoin, there’s an implicit promise that you’ll be able to exchange your bitcoins for goods in the future. Only this time, the entity making the promise is not a government, a bank, or a person. The promise emerges from the network effect. The promise works because enough people keep it (i.e. accept bitcoins). In fact, the promise is self-reinforcing. As long as it’s kept, it grows (more people start accepting bitcoin in exchange for goods and services). Note that the same loop applies to all forms of money.

    That money is a promise is invariant. Promise is the only thing that endows money with value. You can’t eat gold. You accept gold as money because there’s an implicit promise that someone will take gold in exchange for bread.

    Gold as money derives its value (i.e. becomes a credible promise) initially from the fact that it’s a commodity. Then the network effect takes off and becomes the primary source of its value. Bitcoin skips the commodity step and directly depends on network effect — which is why it went from pennies to hundreds of dollars in value (network grew by several orders of magnitude).

    [Reply]

    Zippy Reply:

    You are using the term “promise” equivocally, and conflating financial securities with commodities.

    A security is a title or entitlement. A bond entitles you to fixed payments and liquidation preference to the extent of your entitlement. Capital stock entitles you to profits and residual liquidation value after settlement of liabilities. Fiat dollars entitle you to settlement of tax liabilities.

    It is true, in general, that securities represent a promise made by the issuing institution.

    Commodities are categorically different. Nobody has promised to give you bread for gold: that it may be possible to trade your property for a commodity or other property is not a promise or entitlement/title.

    Strictly speaking, bitcoins and the like are a commodity: an authenticated record of wasted computation. They are not promises or entitlements issued and guaranteed by some institution or authority.

    People of course trade in securities and in commodities; but it is a basic error to conflate them.

    Like tulip bulbs, gold, and dot com companies people may purchase bitcoins for rational or irrational reasons. Some people apparently think that authenticated records of wasted computation are as valuable as gold. They may be right about that.

    [Reply]

    admin Reply:

    Gold is the physical evidence of “wasted mining activity”. It does OK.

    Zippy Reply:

    Gold has all sorts of uses. It is an excellent electrical conductor, resists corrosion, and is beautiful when fashioned into artifacts. But people do often value it irrationally.

    admin Reply:

    If you’re going to define money as “irrational” there’s a lot of economics that won’t make any sense.

    Zippy Reply:

    “Money” is an ambiguous term.

    frank Reply:

    Ok. Would you help me clarify what ‘intrinsic value’ means? For example, what’s the intrinsic value of gold? Is it constant, or does it change? Does gold have the same intrinsic value it did in 1 AD and 2010 AD?

    Zippy Reply:

    I could’t present an adequate metaphysically realist theory of economic value in a combox even if I had one. But I can suggest that the economic value of various kinds of property is intrinsically connected to the objective characteristics of the property; or, said differently, economic value cannot be reduced to nothing but subjective evaluation.

    So the economic value of gold is tied to the objecive characteristics of gold. And the economic value of authenticated records of wasted computation is tied to the objective characteristics of authenticated records of wasted computation.

    admin Reply:

    If Catholicism had anything to contribute to economic insight, modernity wouldn’t have happened at all.

    Zippy Reply:

    admin:

    If Catholicism had anything to contribute to economic insight, modernity wouldn’t have happened at all.

    Have a nice day!

    frank Reply:

    Does ‘economic value’ = ‘intrinsic value’ in your lexicon?

    Zippy Reply:

    frank:
    No.

    “Intrinsic” is an adjective which narrows focus specifically to what is essential to the thing itself. It is intrinsic to you qua human being to have a capacity to reason. It is not intrinsic to you as a human being to breath underwater, although extrinsic circumstances may permit you to do so.

    frank Reply:

    Ok. How do we know if something has intrinsic value? Wouldn’t that necessitate that the thing in question have an essence? Does the color red have an intrinsic value? Does the color red have an essence?

    Do things have values on top of intrinsic values? For example my passport is useful to me while crossing borders. So it has value in the context of international travel. But I can also use it as a form of identification. So would you say my passport has non-intrinsic value?

    In the case of bitcoin, would you agree that to determine its intrinsic value, we need to determine its essence? Let me guess that you’d argue that bitcoin’s essence is ‘authenticated records of wasted computation’. How do you make this claim? Wouldn’t its telos be more related to its essence? Wouldn’t you say bitcoin — being a network created with the specific purpose of being an open, distributed, tamper resistant public ledger — is a mechanism of accounting in its essence? Would you agree that enabling instant transfer of funds, almost for free, anywhere around the world objectively adds value to bitcoin? Would you further agree that this property, being one of the original design goals of the network, is in fact part of the intrinsic value of the thing?

    Physical mining (i.e. proof of work, i.e. what you call authenticated records of wasted computation) is but an extensional aspect of bitcoin. Don’t you think you miss its intensional aspects?

    vimothy Reply:

    Bitcoin is simply an authenicated record of wasted computation

    Indeed.

    [Reply]

    k Reply:

    Bitcoin is backed by dubs. I don’t consider the search for fantastic dubs to be a waste of processing power.

    Just as the choice of metal is arbitrary, the choice of interesting class of numbers is arbitrary, but it is an interesting class of numbers. Related, if you find a new Mersenne prime, you can sell that also.

    [Reply]

    Posted on September 17th, 2016 at 3:33 pm Reply | Quote
  • ihatebuzzwords Says:

    Hyperbole. The meaning of “paradigm” has been diluted into meaninglessness.

    [Reply]

    Posted on September 17th, 2016 at 3:49 pm Reply | Quote
  • (N) G. Eiríksson Says:

    Anyone seen the excellent TV series «Halt and Catch Fire»?

    [Reply]

    Posted on September 17th, 2016 at 4:48 pm Reply | Quote
  • cyborg_nomade Says:

    4 years till the next one then?

    [Reply]

    Posted on September 17th, 2016 at 5:57 pm Reply | Quote
  • Aeroguy Says:

    One of crypto’s big issues as that in reality it hasn’t solved fiat. Sure within any individual crypto-currency scarcity can be built in but that doesn’t stop the miners from deciding to switch to new altcoins. Miners basically get to play the role of central bankers (which answers Kgaard’s second question) and their perverse incentives to print are the same, which leads to them switching from high difficulty currencies to new currencies that are easier to mine and thus inflate the crypto market with ever more altcoins, thus no more scarcity. Granted Bitcoin has held dominant but it’s still precarious especially when transaction bandwidth is considered (the other big problem bitcoin has, due to not enough miners since, surprise, they’re moving to more profitable currencies).

    [Reply]

    Kwisatz Haderach Reply:

    Hey, this is a new argument that I haven’t really thought about, but it has some legs.

    First thought is that it’s a highly general argument. Couldn’t I say that gold is fiat because if I am late to the gold mining game I could start mining silver or platinum and pushing that as money?

    [Reply]

    Aeroguy Reply:

    It is similar, and it’s also why silver is associated with weakening currency. The original thought is that bitcoin is gold and eventually everyone comes back to it but unlike actual miners where once it’s out of the ground it circulates automatically, bitcoin depends on miners to support transactions. The transaction fees probably need to be upped to get the miners properly incentivized. There really isn’t money in mining bitcoin right now but getting your own altcoin to take off even a little is like hitting the mother load. The trick is hitting the sweet spot where mining bitcoin is more profitable than making new altcoins. I don’t think the problem is necessarily intractable, but it does remain to get worked out.

    [Reply]

    Kwisatz Haderach Reply:

    I think the key distinction here is top down/bottom up.

    Fiat is money by fiat from a top-down authority. It did not arise out of spontaneous agreement between a bunch of uncoordinated agents; a single agent with the power to crush you declared that you will use this or else, and the reason why fiat money is a Schelling point is because that agent’s decree made it into a Schelling point. It is a Schelling point to the extent that the agent’s degree is still plausibly enforceable.

    Whereas, non-fiat money is money that arose out of natural, spontaneous agreement between many actors. I think this type of money should be called “natural money”. No single agent was responsible for coordinating natural money into a Schelling point, and consequently no single agent can fundamentally alter the money.

    It actually doesn’t matter if both gold and silver are money, what matters is that a bunch of uncoordinated agents voluntarily decided that gold is money (and treat it as such), and another bunch of uncoordinated agents did the same for silver. No matter if silver, gold, and platinum are all circulated as money, and no matter even if vested interests are engaged in a PR war to establish iridium as the next big thing, what matters is that no natural currency has a single point of failure (trusted agent). Miner Huang and Miner Xiao can push Dogecoin all they want, but they don’t have fiat power, and can’t substantially harm Bitcoin.

    frank Reply:

    There are several key distinctions.

    Assume that 51% of the miners got together and conspired to increase their profits. They decided to change protocols, allowing them to inflate supply. Then they significantly damage or even destroy their own capital by causing mass exodus from or splitting of the network (which is the one thing that makes bitcoin valuable). The investment miners make (mainly ASICs) provide returns insofar as bitcoin is a credible promise. Bitcoin is as credible a promise as its network size. Note that switching from coin to coin is not as easy as downloading new software. ASICs in general cannot be switched. You have to buy new equipment to mine different coins. So if you’re a miner with $50 million investment in mining equipment, you risk losing that amount when you attempt any fuckery.

    Not only incentives of the miners are excellently aligned, bitcoin is very resilient against hostile takeovers by wealthy and powerful entities. Assume that George Soros wanted to destroy bitcoin (h/t @rec0nciler). He would need to buy the equivalent of 101% of the current hashing power. This is, on the face of it, well within his financial means. Yet, the bottleneck is ASIC production. ASIC production cycle is on the order of years (from design to final production). So George Soros’ options are: divert all ASIC supply for the next couple of years to himself, or start his own ASIC production line, with billions of dollars of capital required. Note the immense difficulty of keeping all those things covert. And let’s ignore all the gargantuan hurdles for such a conspiracy and assume that George Soros managed to gather 51% of the hashing power under his control. All the bitcoin network has to do is switch hashing algorithm, and George Soros’ billions of dollars of capital has just become worthless. (credit: @nmgrm @topynate).

    Bitcoin made limited government real. The idea of dynamic geography is to leverage the same network effect borne limits to shackle the Leviathan.

    [Reply]

    Kwisatz Haderach Reply:

    All of the upside in these kinds of attacks is located in the difference between the market cap of the coin and the cost of taking over the hashing operation that backs that market.

    One idea I’ve had to prevent these kinds of attacks is to cap a miner’s hashing power contribution by his market share of coins. A miner who owns 1% of coins could contribute at most 1% of hash power (or assign the amount to a hasher who is paying you a cut). This way the cost of subverting the algorithm is >50% of the market cap of the algo. To corrupt the system is to spend enough money to buy just over 50% of the system outright. There is no reason to subvert a system you already own outright; in fact, you automatically become a conscientious custodian of that which you own.

    [Reply]

    frank Reply:

    > All of the upside in these kinds of attacks is located in the difference between the market cap of the coin and the cost of taking over the hashing operation that backs that market.

    There’s another kind of upside: pure ideology. A government might get motivated enough to burn billions just for the sake of killing right wing extremism and create a chilling effect. The good news is, the next biggest coin would just take over. But I can definitely imagine a communist theocracy fighting bitcoin.

    > cap a miner’s hashing power contribution by his market share of coins.

    Suppose a miner decided to drop out of the network. Now other miners have larger portions of total hashing capacity, but not the portion of coins to match it. Either they have to purchase large sums of coins, or a new actor with large capacity must start mining. Doesn’t seem too workable to me.

    Kwisatz Haderach Reply:

    @frank

    Most owners of coins will just assign their hash share to some miner who pays them a small cut. The miners don’t necessarily have to own large numbers of coins. If a miner drops out the owners will reassign to another miner.

    Since owners don’t want their currency debased by attackers (no matter if those attackers are motivated by greed or ideology), they won’t assign to a hostile actor. This keeps decision making tied to ownership. If a government wants to buy us all out to destroy our bitcoin network, that should be fine. We’ll earn a tidy profit as they bid up the price, then go on and standardize on another coin as the hostile agent electronically wrecks a virtual ghost town of which it is the mayor.

    frank Reply:

    Hmm. This is interesting. Do you know if there is something similar in the crypto-currency scene?

    Kwisatz Haderach Reply:

    I don’t know, but I don’t pay attention to any crypto-currencies but bitcoin and ethereum, they are the only Schelling points.

    Posted on September 17th, 2016 at 7:02 pm Reply | Quote
  • Ur-mail Says:

    > “Thanks in part to the widely publicized Bitcoin, a cryptocurrency built on its platform, the blockchain is creeping out of computer science obscurity into public awareness.”

    Popular technology writing can be truly abysmal. The level of confusion, inverted causality, and inaccuracy in that sentence is hard to top. Bitcoin was not built on a platform called “blockchain”. Blockchains are not some obscure computer science (CS) topic that existed before Bitcoin. Blockchains aren’t creeping into the mainstream from CS.

    The Blockchain concept actually came after Bitcoin, the concept lacked a name when Bitcoin was originally released. It wasn’t until much later that people began to realize there was an interesting fundamental idea lurking under the hood.

    [Reply]

    Posted on September 17th, 2016 at 7:28 pm Reply | Quote
  • grey enlightenment Says:

    I’ve owned bitcoin since 2013, and predict the price and adoption will keep rising. It fills a niche, is a good hedge in global uncertainty and falling foreign currencies

    [Reply]

    Posted on September 17th, 2016 at 7:29 pm Reply | Quote
  • michael Says:

    @Kgaard
    Im willing to believe technology will be developed to make btc easy to use, and while i dont know much about how it works i do think its basically a very long ledger being kept simultaneously. and while i dont have to understand all that if peter theil invents a btc account and card its important because i wouldn’t want to be holding it when it gets to unwieldy. but thats a tech problem which i imagine can be solved with a new type of crypto currency. If there a reason to bother. admin thinks and many others the big deal will be not as currency so much as security. which may well be but is an entirely different animal. as currency id beg to differ that privacy was not supposed to be a feature, again im no expert but it certainly was the most talked about feature which quickly turned out to be a bug because unless you gave up anonymity you could do little more with it than trade it like pokemon cards with other pokemon types. once it was approved it became a speculative futures type instrument sort of reverse correlated with any asian or western fiat fears and or media hype. it was its anonymity feature that made it a threat to fiat.
    to me the fiat problem is not so much fiat as debt and not so much debt as the perverse incentives of spending money that doesnt exist. i think that could be solved with law. if theres no will for such laws which may well be then we need a much better btc cause this one is not near ready to replace fiat and besides we already have gold, a better btc would really end up as a universal currency maybe keeping fiat in check because rather than having to abandon ones nations fiat one can effortlessly slip in and out of any fiat or btc with a swipe of the thumb this discourages fiats from debasing their currency.maybe maybe instead what happens is every african with a cell phone becomes a forex trader and makes raids on small national fiats

    [Reply]

    Posted on September 17th, 2016 at 9:57 pm Reply | Quote
  • Dick Wagner Says:

    One untapped paradigm is applying HBD to our cunning host’s British genes and the crazy projects they make him think he’s in control of.

    [Reply]

    (N) G. Eiríksson Reply:

    What do you mean?

    [Reply]

    Dick Wagner Reply:

    Cladistically speaking, does Neoreaction stem from Puritanism?

    http://www.xenosystems.net/racism-for-beginners/

    “Caucasians should be ashamed of their sanctimonious moral hysteria”

    “should be ashamed of” sounds suspiciously like something a Puritan might say (E.G.) … lmao

    This logic of Anon from Foseti’s blog should be applied to Admin or else you ought to be ashamed:

    Anon:
    I think Moldbug’s Judaism escapes scrutiny. How much does his favored neo-reactionary beliefs mirror Judaism? Is his hatred of Harvard a residue of the Jewish resentment of Harvard for having Jewsish quotas? Is he a ultra-crypto-jew ultra-resentful of the ultra-crypto-Calvinists he despises? Are his beliefs in hierarchy and anti-universalism a residue of the belief in a chosen people?

    Handle:
    Escapes scrutiny. I’ve seen this charge levied a hundred times. But, aside from his talent, as far as I can tell, Moldbug’s half-Jewish lineage affects his political and religious theories to no level distinguishable from zero.

    Anon:
    If you’re going to call everyone crypto-Calvinists and claim that Rawls’ supposed pure philosophy is really Calvinism, while at the same time claiming you yourself practice pure philosophy free from any religious influence, you’re opening yourself to criticism. At the same time he proudly announces his atheism, he claims that atheism is a way to smuggle theology into the state. Then there is his emphasis on the law above all, clearly in the Jewish tradition. In any case, turnabout is fail play; his method of archeology/geneology of beliefs, complete with the smuggling in of hidden theology, should be applied to his own writing.

    [Reply]

    (N) G. Eiríksson Reply:

    Quite.

    Personally, I see everything as theology. The Romans did, before Christianity, and they did after adopting Christianity.

    i agree with the Calvinist adage, “once saved, always saved.”

    how about we do Roman Calvinism.

    Dick Wagner Reply:

    The Bible is transhumanist technology of yore. We have downloaded it and can scrap the hard copy.

    Is cladistics theology? Is the curiosity of whether things are theology theology? Theology is nomos, philosophy seeks the physis from which nomos is derived.

    The Romans practiced augury, do you really want to go back to that?

    (N) G. Eiríksson Reply:

    http://www.gornahoor.net/?p=2596

    (N) G. Eiríksson Reply:

    There comes the time to unclose the truth, to nake a spiritual essence of what boots-licking average people define as “political extremism”. We have confused them, changing the registers of our political sympathies, the colouring of our heroes, passing from fire to cold, from “rightness” to “leftism” and back again. All this was only intellectual artillery preparation, some kind of an ideological warm-up.

    We have frightened and tempted both extremely right and extremely left, and now both have lost their guiding lines, both have been got off the beaten tracks. This is wonderful. As great Evgeniy Golovin loved to reiterate: “The one who goes against the day, should not be afraid of the night”. There is nothing more pleasant than a feeling of the ground slipping away under your feet. This is the first flight experience. It will kill the vermin. It will steel the angels.

    Who we are, actually? Whose threatening face is appearing clearer day by day behind the paradoxical radical political current with the frightening name “national-bolshevism”?

    Posted on September 18th, 2016 at 4:29 am Reply | Quote
  • Zippy Says:

    In the case of bitcoin, would you agree that to determine its intrinsic value, we need to determine its essence?

    I would agree that its value (intrinsic or extrinsic) cannot be entirely unrelated to its essence. Epistemology and ontology are big subjects though.

    Wouldn’t its telos be more related to its essence? Wouldn’t you say bitcoin — being a network created with the specific purpose of being an open, distributed, tamper resistant public ledger — is a mechanism of accounting in its essence?

    Setting aside issues of the telos of artifacts, the proposal appears to be that bitcoin’s value is determined by what its designer’s intended it to be. That obviously cannot be the whole story. Many examples can be given wherein product designers intended to make successful products, but in fact ended up destroying investor value in wasted R&D that never worked out the way they thought it would work out.

    To call bitcoin an accounting ledger is a category error, independent of whether its designers intended to design a ledger. A ledger keeps track of assets and liabilities — of various claims against property which is not the ledger itself. If I am in possession of a copy of the balance sheet of Google it does not follow that I possess Google. A recording of the assets and liabilities of Google is not the property that is Google.

    Would you agree that enabling instant transfer of funds, almost for free, anywhere around the world objectively adds value to bitcoin?

    The bitcoin network doesn’t enable the transfer of “funds”: it enables the transfer of bitcoins. Unlike demand deposits, which represent claims (denominated in fiat currency) against the property recorded on the balance sheets of banks, bitcoins do not represent claims against anything at all. So transfer of bitcoins is not transfer of “funds” , or “money” — except as very ambiguous terms which obfuscate crucial differences not just between different kinds of securities but between securities and property.

    See here:
    https://zippycatholic.wordpress.com/2015/11/12/paper-wealth-or-were-going-to-disneyland/

    And here:
    https://zippycatholic.wordpress.com/2015/10/31/banking-castles-built-with-black-magic/

    [Reply]

    frank Reply:

    > the proposal appears to be that bitcoin’s value is determined by what its designer’s intended it to be.

    No. Its designers had goals in mind, and some of those goals have been materialized. We’re not talking about intentions, but actualities.

    > To call bitcoin an accounting ledger is a category error

    You seem to confuse bitcoin, as in unit of accounting whose current market value is about $600, and bitcoin, as in the network whose function is to keep records to determine ownership of coins (thus, as an account of credit). When shell necklaces are passed around in exchange for a specified amount of goods, they function as records of credit: I gave you 5 potatoes in exchange for this necklace, which now definitively proves to other members of the necklace network (including you) that I have credit: hence, ledger, a log, a register of credit.

    Money, conceived as a credit network, is no different in its core premise than claim checks. Members of the money network, through their demonstrated preferences, i.e. by accepting money in exchange for goods and services, explicitly agree to treat money as the network-wide unit of accounting. If a member no longer agrees to treat money as unit of accounting, he exits the network. When a seller announces that they accept bitcoin, it’s an explicit promise on their part to provide goods in exchange for bitcoin. Thus, nodes of the accounting network keep making promises to other nodes. A claim check functions on the same premise. I promise you to give your jacket back when you return your claim check. I may break my promise. Your check means nothing without my promise. Furthermore, you value your check only to the extent that you find my promise credible. Exactly the same thing happens in the money network. I value money only to the extent that I find the promise of the network nodes credible.

    What is–insofar as it’s a valid concept–the intrinsic value of a claim check? Isn’t it a function of the credibility of the underlying promise? What is the intrinsic value of gold money? Isn’t it a function of the credibility of the seller’s promise to accept it? What is the intrinsic value of bitcoin?

    I suggest you to read the bitcoin white paper. It’s very short (6-7 pages) and conceptually clarifies lots of things.

    > The bitcoin network doesn’t enable the transfer of “funds”: it enables the transfer of bitcoins.

    “The transfer of a title doesn’t enable the transfer of property.” No, it does. I can easily demonstrate to you that I can transfer funds, right now, using bitcoin, to anywhere in the world.

    Wlog, let’s say I want to transfer $100 to you.

    Step 1) You setup a bitcoin wallet.
    Step 2) I buy a little more than $100 worth of bitcoins.
    Step 3) I send you the bitcoins.
    Step 4) You immediately sell your bitcoins for about $100.

    [Reply]

    Zippy Reply:

    frank:
    As far as I can tell, you are still simply avoiding (or fail to grasp) the fact that (unlike stock, demand deposits, bonds, fiat dollars, and the like) bitcoin is not a security: ownership of a bitcoin does not entitle you to anything at all other than the bitcoin itself.

    You suggest that a bitcoin represents a promise: but who in particular has promised you what in particilar? An abstract promise from nobody in particular, backed by no specified property, is no promise at all. If nobody will buy your bitcoins you don’t have anyone to accuse of breaking their promise, and there is no pool of property which you can reference claiming entitement to a share.

    Bitcoins are a commodity not a security. (As a aside, one of the sociological oddities of bitcoin is that software people really ought to grasp the difference between references to objects and objects. Somehow when it comes to financial securities the intellectual capacity to do basic dereferencing goes out the window. Relevant: https://zippycatholic.wordpress.com/2015/11/02/self-referential-securities-and-wealth-bubbles/ ).

    That other people may or may not willingly trade for something – beads of necklaces and the like – does not make that something a security (whatever vocabulary you want to use for editorial purposes). Willingness to trade at this particular moment is not the same thing as title/entitlement to property. That someone is willing to trade for insulin or tulip bulbs is not the same thing as a bond which entitles you to regular payments backed by a pool of property recorded on a balance sheet.

    You aren’t alone of course. Most modern economic theorists (keynesians, austrians, mmt, etc) labor under the shadow of metaphysically anti-realist error.

    [Reply]

    frank Reply:

    > you are still simply avoiding (or fail to grasp) the fact that (unlike stock, demand deposits, bonds, fiat dollars, and the like) bitcoin is not a security:

    It doesn’t pertain to the argument. Engage the argument. You initially claimed that bitcoin’s intrinsic value is “approximately equivalent to the value of an authenticated photograph of someone doing something stupid”. I asked a series of question to make sense of what you mean by ‘intrinsic value’, which you avoided answering. Than I accepted the concept as nebulously as you left it and proceeded to apply it the same way you apply it to different things to deduce certain conclusions.

    The lynchpin of the argument is this: do you accept that the intrinsic value of a $100 demand deposit to BoFA is not the same as the intrinsic value of a loan receipt for $100 to a random hobo? If your answer is no, then your concept of ‘intrinsic value’ is irrelevant vis-a-vis determining the value of a currency, making your initial claim about the intrinsic value of bitcoin gibberish in the context of this thread.

    >You suggest that a bitcoin represents a promise: but who in particular has promised you what in particilar? An abstract promise from nobody in particular, backed by no specified property, is no promise at all. If nobody will buy your bitcoins you don’t have anyone to accuse of breaking their promise, and there is no pool of property which you can reference claiming entitement to a share.

    I use the word promise because it’s a perfect semantic fit for the pertinent parameter in determining the value of an asset. A promise is always a potential, whether it’s a promise to pay $100 in the future, or if it’s a promising young student. The promise of bitcoin is its potential, its expected utility. The promise of a loan is its expected return. What does it matter if you can accuse your debtor of breaking his promises if at the end of the day you get $0 dollars back? The promise of a demand deposit is that it is extremely unlikely that the bank will default on it. The promise of bitcoin is that you’ll be able to exchange them for goods and services, instantly, globally, and securely. The principle by which we judge value is invariant, and encapsulated in my use of the word promise (and no, I don’t use it equivocally).

    under the shadow of metaphysically anti-realist error.

    You assert that yet you can’t even define what ‘intrinsic value’ means. In fact you don’t even put out an objective method for determining the intrinsic value of objects.

    Zippy Reply:

    frank:

    The lynchpin of the argument is this: do you accept that the intrinsic value of a $100 demand deposit to BoFA is not the same as the intrinsic value of a loan receipt for $100 to a random hobo?

    Of course.

    Do you accept the fact that a bitcoin is not a promise (commitment, entitlement) of anything at all from anyone in particular?

    The principle by which we judge value is invariant, and encapsulated in my use of the word promise (and no, I don’t use it equivocally).

    If you really cannot tell the difference between (1) a specific pledge of a specific thing by a specific person, and (2) your personal guesstimate about how some financial bet may come out, then further discussion is really quite pointless. Same if you are merely affecting an incapacity to tell the difference as a rhetorical flourish.

    frank Reply:

    “Only this time, the entity making the promise is not a government, a bank, or a person. The promise emerges from the network effect.”

    I’ve been using the word promise consistently since the very beginning of our discussion.

    >the difference between (1) a specific pledge of a specific thing by a specific person, and (2) your personal guesstimate

    It’s a difference of degree, not of kind. A hobo’s $100 promise is worth less than $100 worth of bitcoin. Your metaphysical realism fails you.

    Your systematical avoidance of addressing what you mean by ‘intrinsic value’ or ‘value’ is a sleight of hand to conceal the fact that there’s nothing of substance supporting your claim that bitcoin’s intrinsic value is “approximately equivalent to the value of an authenticated photograph of someone doing something stupid”.

    You probably don’t have any idea what intrinsic value means. You argue in bad faith. I’m done.

    Zippy Reply:

    I’ve been using the word promise consistently since the very beginning of our discussion.

    And yet – amidst your attempts to reframe – you refuse to concede the manifest point that a ‘”promise” [which] emerges from a network effect’ isn’t really actually the same kind of thing at all as an actual promise of something in particular from someone in particular to someone in particular.

    Therefore, your contention that you are not using ‘promise’ equivocally is just obviously false.

    All of which would remain the case even if I myself were an off-my-rocker loon who doesn’t know jack about finance, epistemology, or ontology; or even if I were a liar and a troll arguing in bad faith.

    It is no secret, as readers of my blog know, that I hold simultaneously that:

    1) There is no metaphysically realist economic theory. It does not exist. We don’t even know what form such a theory would take.

    2) Anti-realist economic theories – including ones which are, in virtue of their anti-realist commitments, incapable of distinguishing between actual promises of actual property and ‘network effects’ – are insane. This includes all of the popular and false modern theories: Keynsian, Austrian, MMT, etc.

    3) It is commonplace for adherents to manifestly insane theories to insist that their manifestly insane theories must be right simply because no alternate theory is on offer. A known-to-be stupid and wrong theory is better than simply conceding that we don’t actually have a sane theory. (See my writings on positivism).

    I understand that encountering this way of thinking (that is. metaphysical realism) can be quite novel for many people. Contra the contention of our blog host above, the insanity of modern economic theory arises – even though the Catholic Church has no special charism when it comes to finance and economics, any more than it has special knowledge of physics or chemistry – from the practical abandonment of traditional Catholic moral doctrine on usury (by Catholics, not just everyone else). More generally, it arises from abandonment of realist/essentialist metaphysics.

    I’m not shy about saying all of this — again as any reader of my blog knows.

    admin Reply:

    How is that “contra” my contention? It’s a restatement of my contention. Traditional society suppressed autonomous capital. It nevertheless escaped, thanks to the Reformation. There are still Catholic-traditionalist dreams of putting it back in its box.

    Zippy Reply:

    admin:

    You ought to read my usury FAQ if you are under the impression that the traditional moral doctrine “suppresses autonomous capital”. See for example Pope Callistus V’s affirmation that non recourse borrowers rightly forefeit their property if they stop making census (principal and interest) payments.

    As for dreams of restoration, I’m not a subscriber. I am a subscriber to the idea that mother nature (or what the kids call gnon) is a bitch. She can be avoided for quite some time given enough resources; but eventually she’ll have her way.

    Ahote Reply:

    @admin

    You’re arguing with a guy that thinks time preference doesn’t exist. It’s an exercise in futility to argue with a guy that thinks a lunch today should be worth the same to me as the lunch hundred years from now. The poor guy thinks time dimension don’t real. Well, time does exist, and a lunch today is worth more to me than a lunch in a hundred years (pretty much in the same way-because space dimensions exist too-a lunch in a nice place is worth more to me than same lunch taken near a smelly dumpster). The guy also thinks there’s an objective measure of value, independent of people’s preferences. Guess what? There isn’t. Everything has a value only because people ascribe it value. That people need some things for some stuff doesn’t change the fact that the things don’t have value because of stuff, but because people want the things. If people want useless things that you can’t to stuff with, it will gain value just the same. I mean jewelry itself is just useless junk, but it has almost always (exception is e.g. the time and place where food and water are so scarce that someone is willing to part with a diamond for a piece of bread) been valued more than bread and water, despite bread and water being a necessity.

    Zippy Reply:

    “Time preference is not property” and “time preference does not exist” are nontrivially different statements.

    Ahote Reply:

    Should a house in a black ghetto and the same house in whitopia cost the same? Is getting a car today equally serviceable to me as getting a car in a thousand years? I mean, unless the guy that is selling me the car sells me the car for something like ¢1 he’s engaging in usury.

    Zippy Reply:

    Your little straw men are very cute. But if you really want to know what non usurious futures contracts look like, you might try reading my usury FAQ.

    (N) G. Eiríksson Reply:

    Sameness is not an absolute. It´s an equivalence factor. A sandwich could be worth the same to you for all intents and purposes now as it would in a decade.

    (N) G. Eiríksson Reply:

    If he´s 19 yo, or if we have the fortune of life extension, a lunch today could be worth the same to him as the lunch hundred years from now.

    Not absolutely the same, obviously, as there are no two instances absolutely the same (except instances of purely coded things).

    (N) G. Eiríksson Reply:

    >what non usurious futures contracts look like, you might try reading my usury FAQ

    You should be able to summarize it in a sentence and show it here.

    Zippy Reply:

    Sure: the short summary is that as long as the security on the futures contract is property – as long as it is secured by property not personal guarantees – it is not usurious.

    See the FAQ for answers to all of the questions that naturally pop into your head at that summary answer.

    Ahote Reply:

    It’s not a straw-man, it’s how things are, sorry. The position of a thing in space-time continuum is as much its property as its other properties. You refusing the recognize the fact so you could uncritically stick to Medieval ignorance is not my problem (funny how you traditionalists never propose going back to bloodletting medicine, alas, we cannot get a shred of consistency from you people). Also, I explicitly deny that usury=interest, so as far as I’m concerned, most contracts are non usurious.

    Zippy Reply:

    Sure, but in general some things can be property and some things cannot. If time in itself were capable of being sold or rented as property, workers would be owed wages simply for time elapsed not for work done. In reality time based wages are just a convenient proxy for what a worker actually does (makes actual through his for-hire activities).

    Time preferences are real enough both as subjective experience and as parameters in economic theory. But preferences in themselves cannot be alienated from a particular person and sold or rented as property; and parameters in economic theory are no more capable of being property than the real numbers or the pythagorean theorem.

    Ahote Reply:

    Look. There was a good reason why interest on loans was looked down upon in Middle Ages. Interest itself wasn’t the problem, but the fact that it was an act of great cruelty toward the destitute. Then seeing the bad stuff happening to the destitute some people tried to explain why it was bad. Commendable, for sure, but so were the people who developed Fluid theory of electricity. Unfortunately the fate of pioneers of knowledge is to be superseded. Now, if someone were to make a religious doctrine out of Fluid theory of electricity, then we have a problem. You’ll get people desperately trying to prove how Fluid theory of electricity is right, and how all those who believe in particle theory are heretics and all those who engage in electronic circuit design sinners.

    [Reply]

    Zippy Reply:

    Profits on personally guaranteed loans (today we might call them “full recourse”) to the rich were also condemned as intrinsically unjust. Usury hurt the poor more to be sure; but the poor are more vulnerable in general so that isn’t exactly surprising.

    The basic issue is treating a personal ‘wink and a promise’ as if it were the same kind of thing as property. It is a lesson — financial as well as moral — that moderns have worked very hard to un-learn.

    It isn’t as if some sort of utopia would emerge if the courts stopped enforcing deficiency judgments on personal unsecured loans. But it would help keep loan to value ratios sane, would mitigate one major source of “bubbles”, and make certain kinds of fraudulent financial shenanigans more difficult.

    That isn’t an endorsement of all things medieval as much as it is an indictment of modern hubris.

    Ahote Reply:

    >Profits on personally guaranteed loans (today we might call them “full recourse”) to the rich were also condemned as intrinsically unjust.

    Only late into Middle Ages. None of the Church Fathers mentions usury in that context (that is all interest=usury), and the only official Church act from that period was a single canon that forbade *clergy* from charging interest higher than 1% per month. Old Testament instructions are similar to that, and same in spirit. The Church Fathers and the Old Testament condemn oppression of the needy, rather than engaging in casuistry to prove that interest in itself is somehow unjust.

    Had Saint Basil considered interest illegitimate, would have he said that God will pay interest for the poor?

    Give the money,… without weighing it down with additional charges, and it will be good for both of you…. The Lord will pay the interest for the poor… The interest, which you take, is full of extreme inhumanity. You make a profit from misfortune, you collect money from tears, you strangle the naked, you beat the famished; nowhere is there mercy, no thought of relationship with the sufferer…

    Zippy Reply:

    I’m not sure what I am supposed to make of the observation that the Church’s most prolific reiteration and clarification of usury doctrine took place during a period of massively increasing economic activity and trade. Isn’t that precisely what I ought to expect?

    Ahote Reply:

    That Constantinople man… it sure didn’t see any economic activity and trade.

    Zippy Reply:

    Is there an argument somewhere in there that Aquinas and the medievals were wrong on the specific subject of usury?

    Ahote Reply:

    Of course Aquinas was wrong! If valuing present money over future money is “double charging” then so is valuing whitopia house over identical black ghetto house.

    vimothy Reply:

    bitcoins do not represent claims against anything at all.

    Precisely – bitcoin is not really money in the usual sense, it is a sort of digital gold.

    [Reply]

    admin Reply:

    The notion of money as a “claim against something” is a fairly recent degeneration.

    [Reply]

    vimothy Reply:

    Not as recent as the notion of money as digital address space.

    vimothy Reply:

    Although it’s not actually true that the notion of money “as a claim on something” is a new. Explicit forms of credit such as tally sticks have been found dating from the Upper Paleolithic, and were common in medaevil Europe (see https://en.wikipedia.org/wiki/Tally_stick ). And even under gold standards money was still “a claim on something” (namely, gold – or rather, the issuing bank’s assets, which included gold), so it certainly predates industrial capitalism, at least.

    admin Reply:

    The gold standard is a distraction from precious metal currency. For almost the entirety of recorded history, money has been (fundamentally) a mixture of gold, silver, and copper coins. No ‘claims’ of any kind involved.

    vimothy Reply:

    Representative money (i.e., money as ‘claims’) goes back as far as banking and was present in Ancient Egypt, India, China and Babylon. It predates coinage by centuries. But what if it didn’t – what’s the argument being made here? Bitcoin is not a commodity and does not trade as one outside of its limited use as money. Bitcoins are entries on a distributed accounting ledger. They are not commodities, nor claims over commodities, nor claims over anything else.

    Posted on September 19th, 2016 at 1:03 am Reply | Quote
  • Anomaly UK Says:

    To enrich the original “5 paradigms” idea:

    [epistemic status: speculative]

    Skip the first two, because what’s interesting is how computers mediate between people, so disconnected computers are not important.

    Step 3 is internet; the early internet was peer-to-peer: People could connect to other people, directly, usually based on pre-existing relationships.

    Step 4 is social; the replacement of peer-to-peer with third-party mediated communication. You tell the network who your connections are, and they will build them together into a web on your (and their own) behalf.

    Step 5 would be replacing mediation by third parties with mediation by pure algorithmic aggregation. When facebook connects you with people it’s doing so algorithmically, but the algorithms are representations of facebook and facebook’s will. With bitcoin, twister, etc., the algorithms are not part of the network, but exist independently of it. The logical relationship between people is separate from the transport.

    ( gab.ai : twister :: Trump : NRx )

    [Reply]

    Posted on September 19th, 2016 at 9:05 am Reply | Quote
  • Cryptocurrency as cuck finance, or, promises made by Pokemon | Zippy Catholic Says:

    […] and there, and I sometimes read and very occasionally comment on other blog posts in those feeds.  Here is a recent discussion involving bitcoin and cryptocurrencies which some of my own readers may find […]

    Posted on September 19th, 2016 at 2:19 pm Reply | Quote
  • (N) G. Eiríksson Says:

    Zippy,


    Just sayin:

    >as long as the security on the futures contract is property – as long as it is secured by property not personal guarantees – it is not usurious.

    I understand the conception. But property changes in value daily. In the Middle Ages it happened more slowly than now, perhaps.

    The property could be lost and thus the guarantee, was also dependent on the person.

    E.g. the person had to make sure it was not destroyed by bandits / in a fire.

    Ultimately I´m getting at is how could we anyway return to the ancient or Feudal/Catholic mode?

    I mean, what are the steps. I can see that the laws would be changed. But what would be the gain?

    How is this different from Anarcho-Capitalism?

    (Non-rhetorical questions.)

    [Reply]

    Zippy Reply:

    I do, actually, address all of those questions in the usury FAQ and elsewhere. And while I am generally amenable to the “give me a one sentence summary in a combox” request at some point the more appropriate answer is just to make an attempt at a charitable reading of all the stuff I’ve already written.

    [Reply]

    Posted on September 19th, 2016 at 6:03 pm Reply | Quote
  • Zippy Says:

    Apparently the WordPress behavior in replying from an email notice is inconsistent moving from phone to desktop. So I’ll cite @Ahote inline here:

    Ahote wrote:

    Of course Aquinas was wrong! If valuing present money over future money is “double charging” then so is valuing whitopia house over identical black ghetto house.

    You might want to actually address Aquinas’ actual argument – as opposed to a silly caricature – before declaring it wrong.

    [Reply]

    Ahote Reply:

    Aquinas failed to explain why “double charging” is wrong, and how is it anything other than, essentially single charging at a higher price. Also, how is value not subjective. Pyromaniac that buys a house only to burn it down, and a partymaniac who rents a grassy plain for an outdoor party certainly value their fire\party more than they value their money, and make their preferences a reality by paying for them. Now, from you point of view they may have wasted money, or “destroyed value,” by not from theirs, for they obviously value their satisfaction gained from those actions more than they value their money, otherwise they wouldn’t have traded their money. Similarly, I suppose that there’s no amount of money in your possession that you wouldn’t give up to destroy Planned Parenthood? Clearly that means you value innocent life more than any money. As you can see, one cannot “destroy value,” for value is purely subjective. Well, unless you are looking at things from materialist-utilitarian mainstream econ perspective, where only value is material wealth.

    Look, I fully bought into Haidt’s deconstruction of Enlightenment, all people believe what they want to believe, regardless of reason, facts, or truth. All the rationalizations are simply apologetics for views they already hold. I never thought that I would convince you that a good’s position in time affects its value as much as its position in space. However, I think you have to concede two things.
    1. Ban on interest never worked. People always found ways around it, that is when supposed “usury-free lending” didn’t involve just reinventing-interest-but-calling-it-by-a-different-name, they either: a) found legal loopholes; or b) just did it extralegally. Of course, from this fact, in and of itself, does not follow that interest should be legal, or illegal.
    2. Surely you must agree that any monetary and banking system other than real hard money + full-reserve banking is institutionalized usury, usury of such level and magnitude that interest on loans pales to complete nothingness in comparison. Medievals condemned princes for debasing currency, and Fr. Bernard W. Dempsey noted that even if we accept interest as legitimate, fractional-reserve banking amounts to “institutional usury” and is especially harmful to society, since it repeatedly generates artificial booms, busts, bank crises and economic recessions. Should not, then, people who complain agaist usury, like yourself, spend proportionally more focus on a bigger problem? Yet, it is very rare to hear those people demand non-usurious money and non-fraudulent banking.

    [Reply]

    Posted on September 19th, 2016 at 10:38 pm Reply | Quote
  • Zippy Says:

    Ahote:

    Pretty much everything you wrote in your most recent comment is wrong, at least in terms of characterizing my views and Aquinas’ view.

    1) Of course the value of property changes with both place and time. In general, everything material is subject to the second law of thermodynamics. That you think this is contrary to my view just shows that you haven’t grokked my view.

    2) Even zero reserve non-recourse lending is not usury. Read my “banking castles” post already linked above. Non recourse ‘lending’ securitizes property. Full recourse ‘lending’ attempts to securitize personal IOU’s and treat them as if they were the same kind of thing as actual property.

    3) Framing the issue as a ‘ban on usury’ gets things backwards. The practical issue is what contract terms the government should actively enforce. The government should not be enforcing full recourse deficiency judgments any more than it enforces contracts where a person sells himself into chattel slavery.

    4) You haven’t grasped Aquinas argument at all, because of your anti-realist commitments. Things which may or may not exist in the future do not actually exist now. Potentialities can be bought and sold in Aquinas’ view, but

    5) Conflating the ‘just price’ with usury is a category error.

    6) It isn’t that subjective evaluation and context have no part in economic value. It is that economic value is not reducible to nothing but subjective evaluation. Reductionisms which attempt to understand economic value as nothing but subjective evaluation are crazy, wrong, and literally disconnected from reality.

    Again, I cover all of this in great detail in my FAQ and related posts.

    [Reply]

    Ahote Reply:

    The question is why do you uncritically stick to Aquinas, but ignore later developments of Scholastic theory (Martín de Azpilcueta anyone)? It reminds me of the behavior of Mohammedan and Seventh-day Adventist apologetes. Why, those fossils must be a test of faith, because evolution never happened! When one starts with a conclusion, one can easily find a theory fit for the conclusion.

    Also, why shouldn’t a person be able to become a slave as a settlement for debt?

    [Reply]

    Zippy Reply:

    Ahote:
    I reject the liberal arguments of (e.g.) the Salamancan school because they are wrong and Aquinas was right. Also, Aquinas’ understanding is consistent with Catholic doctrine whereas the liberals are always trying to weasel around it.

    My decades of experience founding companies and managing portfolios was a significant factor in helping me understand why that is the case. As I explain in the usury FAQ, insistance on personal guarantees is a big red flag that the capital structure of a proposed investment needs to be re-thought.

    [Reply]

    Ahote Reply:

    >they are wrong and Aquinas was right

    Proof?

    >Aquinas’ understanding is consistent with Catholic doctrine

    Of course it’s consistent when he invented it! However, as we’ve seen, the Old Testament and the Church Fathers paint a different picture.

    >My decades of experience

    Personal anecdotes do not a proof make.

    Zippy Reply:

    The OT and Fathers are no more inconsistent with Vix Pervenit than they are with Humanae Vitae.

    As for “proof”, well, read and understand. Or don’t.

    Posted on September 20th, 2016 at 5:24 pm Reply | Quote
  • Zippy Says:

    To finish the dropped sentence: “Potentialities can be licitly bought and sold in Aquinas’ view, but only inasmuch as they inhere in things which actually exist now. Imaginary future things which might or might not come to pass depending on how things go are not actual things.”

    [Reply]

    Posted on September 20th, 2016 at 5:27 pm Reply | Quote

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