On the Practicalities of Counterfeit-Proof Physical Bitcoins 121
fsterman writes "What do you get when you cross physical one-way-functions, a distributed and secure datastore, with physical Bitcoins? A viable alternative currency for micro-nations and dictatorships with hyper-inflation." Whatever your thoughts on bitcoin, it's interesting to think about the infrastructure and production cost of the tokens we use as money more generally.
Not necessary (Score:4, Informative)
There's already a currency available world-wide, used instead of local currencies of dictatorships. It's also the preferred currency of such nations as Saudi Arabia and other Arab states...as well as Iran. It's called the US dollar.
There are about as many dollars in circulation outside the us as there are here. It's why more nations invest in the US than in any other nation, with treasury bonds. The Euro stinks, and they can't trust the Chinese to not futz with their system.
Now, if we keep going with this default business...
Re:Did Taco just throw us all under a bus? (Score:2, Informative)
Is Slashdot deleting posts about the Beta? Didn't this site used to not delete posts?
Well, all firehose entries related to the beta are marked as spam, all comments are quickly modded -1, so why not do the next step and delete posts?
After all, even the useful idiots that complain about the protest might some day understand what is at stake, so it is even better if they are "protected" from subversive ideas.
Re:Why do dictactorships have hyperinflation? (Score:4, Informative)
Bitcoin makes that impossible, so the end result will be that those governments will either not use such a limited currency, or will use it up until the point they want to print more where they will then either abandon the cryptocurrency or declare that some other currency must have some exchange rate with the Bitcoins and print more of those.
This, except for that very last part. It isn't possible to tie a non-inflationary currency via a fixed exchange rate to another currency, then inflate that other currency. That is a contradiction. You can do one, or the other, but not both.
Most of the time, the governments in these hyper-inflationary states are printing more money in order to spend more money or to save their own asses, at the peoples' expense. (Just as, to a lesser degree, the U.S. government has.) So they would simply not allow the non-inflationary currency, or abandon it when they saw it didn't suit their purposes.
It's far past time we kicked these adherents of failed and discredited Keynesian theory out of government economics. Sadly, Janet Yellen, new Fed chief, is a staunch Keynesian and a fan of the "new" Phillips Curve, which was demonstrated pretty thoroughly to be wrong about 20 years ago.
We already have stagflation under Obama: high inflation (government inflation figures are just plain B.S.) and high unemployment. If Yellen has her way, we could have high inflation, high unemployment, AND high interest rates.
Be afraid. Be very afraid.
Re:Production cost (Score:4, Informative)
My point, that I recalled from memory slightly incorrectly, apparently, is that coinage is a tiny, incidental business. That all involved want to limit.
Paper money, on the other hand, is what national debt dreams are made of.
Re:Why do dictactorships have hyperinflation? (Score:4, Informative)
HEALTHY markets are zero or negative inflation. Take computer-related equipment: every year, you get more bang for the buck (even when you consider they're inflated bucks). That's called deflation.
No, no, no. You cannot parcel up "deflation" and "inflation" on a per-market basis, then use that to determine the strength or weakness of a currency.
A deflationary currency is a bad thing; you simply have to remember that an economy thrives on people buying things from each other, and breaks down when they stop doing so. It's a bit more complicated, obviously, but primarily you need to be concerned when people have an incentive not to do so.
Deflation causes a breakdown in this in that it becomes acceptable to get "returns" (i.e. increase in worth) for a currency by simple stuffing it in a mattress. This is very harmful, not least because it's a positive feedback loop; the more people stuffing currency in their mattresses, the smaller the money supply, and the faster the currency deflates. See the Great Depression for an example.
For nearly 300 years, inflation was essentially zero in North America, and we had a healthy economy (arguably the healthiest in the world).
If by "essentially zero" you mean "inflation and deflation of double-digits year over year", I suppose that's half-true. It doesn't make for a stable economy, though. And just for kicks, you should look for all of the "Panics" that happened in 19th century America, you might be surprised at the number and their severity.
We need to end the Fed, and re-instate a hard money standard. Just those two things would fix many of our ills.
This is very, very much not the case. Why do you think the "Great Moderation" happened? Why do you think that not a single nation in the world is using a "hard money" standard anymore?