First, what is a bitcoin (WSJ video)?
---
Perhaps, the post is a little late. Two recent views from the WSJ are a good starting point. Fortunately, both of these are open to public reading. So, let's start there.
- How much is that burger? (12/15/13) -- Brian Wesbury looks at some of the challenges facing the adoption of things, like bitcoin. We all know about money's need to be useful in facilitating exchange and storage of value. But, money needs to be safe, as well. The technology behind Bitcoins must have a little more scrutiny. There are several things to discuss in that regard.
- Evangelist sees cashless society (12/19/13) -- Michael J. Casey quotes the techie view: We are at the Mosaic stage of bitcoin. So, all sorts of things can ensue from this start.
 |
| From talk at Gresham College, UK |
One thing to say about bitcoin is that it demonstrates another type of currency alternative. What we use now is fiat money (jaw-boning by a central banking system establishes the policy (oh yes, the Fed does other things, like buys bonds - as we see with QE (requiring tapering), however we also have fiddling of knobs and levers going under the names of things like LIBOR).
Another thing to consider is that fiat money has no physical basis (one reason that we can have leveraging up to 100s of multiples behind which there seems to be no sanity - beyond short-term profiteering). Many attempts have been made to establish such a basis for money, to wit the gold standard. Some have suggested an energy-based model (see A Prosperous Way Down - a 2012 presentation - Emergy).
Aside: Note the inverted pyramid from this 2008 report. The image still applies after all this time. It is a modification of the image shown here. Inverted triangle showing the chimera from yellow up. Note the quote: the thing doesn't collapse, rather it evaporates.
One might claim that the use of bitcoin would be more natural than a gab-standard'd approach like we have now, given its mathematical framework. The energy-oriented approaches would require heavy computing, as it may very well be that money, if handled appropriately, would be computationally framed (ah, all sorts of things to discuss there). However, issues, such as those raised by Wesbury (above) would still apply. And a whole lot more comes to mind (will be of continuing interest).
 |
| source to be identified |
Aside: Note the inverted pyramid from this 2008 report. The image still applies after all this time. It is a modification of the image shown here. Inverted triangle showing the chimera from yellow up. Note the quote: the thing doesn't collapse, rather it evaporates.
One might claim that the use of bitcoin would be more natural than a gab-standard'd approach like we have now, given its mathematical framework. The energy-oriented approaches would require heavy computing, as it may very well be that money, if handled appropriately, would be computationally framed (ah, all sorts of things to discuss there). However, issues, such as those raised by Wesbury (above) would still apply. And a whole lot more comes to mind (will be of continuing interest).
Remarks: Modified: 12/19/2013
12/19/2013
12/19/2013
No comments:
Post a Comment