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Not sure how far back you want to go back but Debt: The First 5000 Years is a real tour de force of understanding how monetary relations were organised over a large number of different cultures and different times.. http://en.wikipedia.org/wiki/Debt:_The_First_5000_Years


tangentially, this is a classic example of Google plus inability to link straight to content.. what is up with breaking one of the best things about the web (links as first class citizens) Google ?


utunga 117 days ago | link | parent | on: Why am I here?

This comment is not really fair [1] but when he writes "I get the safety of knowing I won't be the target of a frivolous lawsuit, since I have very little net worth" I had to wonder. I did the math to see that translates to an annuity of over a million a year. I don't know about you but I tend to think that if one lives simply with just 'a good apartment, a good laptop, and a few other basics' then (even after taxes) one's net worth would probably be increasing fairly rapidly over time. Even on only a million a year! Guess I'm feeling very Mrs Bennett right now, though fortunately I have no daughters to thrust in his direction ;_)

More power to Mr Sivers who has made a great choice of new location in my humble, but biased, opinion.

[1] This is not really worthy of our hero D Sivers because as he notes 5% a year was apparently the minimum allowed.


sivers 117 days ago | link

Agreed. It sounds ridiculous, but I was honestly upset about that 5% minimum payout. Instead I funnel it back into projects that are hopefully useful to others.


The word 'fiat' as related to currency, is often unhelpful and confusing. It should, in my opinion, only be used to refer to the aspect of some currency which is that it (sometimes) has government backing (ie that currency is declared to be legal tender for all debts by 'government fiat').

The whole money-as-IOU vs money-like-gold distinction is another thing again.

So, I think original reply has a very good point. There are two types of currency being talked about and bitcoin is very much in the money-like-gold camp whereas this proposal is very much a money-as-iou concept. Personally I think this idea of combining the two is really exciting and something I've been working on - like modern banking is to gold, I think money-as-iou built on top of bitcoin is a very exciting prospect.

In my way of looking at things there is fiat money then there is debt based and market based money, or as I like to call them 'two sided' and 'one sided' currency.

Bitcoin is a 'one sided' currency like gold (or tulips during the tulip mania) in that there is only one person involved in creating its value. Originally it's mined, but it's valuable because there are people who will buy it today because they estimate there will be people who want to buy it tomorrow. That is, there is market today, because there is an estimate of a market for it tomorrow (and a guarantee of limited supply). People buy bitcoins (or gold or tulips) today either because they are speculating on it's future value or because they find it useful to convert there thing of value (let's say it's tee shirts they are selling online) temporarily into gold or bitcoins because the instrument in question is more easily transferred, combined and stored than the thing they have of value (tee shirts). However, their intention in either case was to sell it back into the market later on. As the Austrian economists would say there is a market value for cash in your wallet because its easier to carry around this cash and turn it into bread at the corner store than try to convince the shop owner to accept an hour of your labor (or part ownership in your house). The point being that nothing intrinsically 'backs' the currency other than the ongoing existence of a market place [1] and corresponding estimate of that ongoing existence.

'Two sided' money or debt based currency systems require at least two people to create them, They are 'valuable' regardless of the market mood in future, because at some point a promise was made to redeem that instrument for something ostensibly of value in future. To the extent that the person (or person(s)) making that promise continue to be 'in good standing' the instrument in question continues to have value. They also have value, like one sided systems, because of simple market place estimates. Two sided or debt based currency systems include mutual credit systems (such as LETs or 'commercial barter'), the original ripple system, and also, in a much more complicated way, most of the value in our modern commercial money system. You can distinguish a debt based system different from 'one sided' system in that, nominally at least, the instrument of credit is destroyed once it returns back to the person who created it, so the amount of currency in circulation can expand or contract depending on the amount of promises made.

With modern money (what people sometimes, unhelpfully call 'fiat' money [2]) our commercial banks create more money by expanding their balance sheet. When they do this, a new deposit is created at the same time as a corresponding promise in the form of a loan the bank makes to a person (who promises to pay back the loan by doing things for the instrument in question, aka 'money' and then returning that money to the bank). When the person or company eventually pays back that loan (or they default) the corresponding deposits on the other side of the balance sheet are also extinguished. In this way the money supply can both expand or contract. (Unlike gold or bitcoin).

In practice, of course, it only ever expands. Two sided aka modern money is more flexible than one side money (aka money-like-gold, aka bitcoin) in that the supply, or more usually, the rate of creation of supply can be controlled by adjusting the interest rates on loans (and hence the willingness of people to take up new loans and thus expand the money supply). On the other hand some claim it is more open to corruption (or just short term thinking) leading to oversupply and hence inflation (or loss of value) in the longer term.

All of which is to say the grandparent post really has a very good point. This proposal is about money-as-IOU which is really quite the opposite of the bitcoin money-like-gold concept. That said, the combination of the two is very exciting in my opinion (which is why I've been working on http://thankful.as and have been excited about ripple since as an idea since I first heard about it)


[1] Of course Gold (unlike bitcoin) does have a small 'intrinsic' value as adornment or in industrial processes, but IMHO this is largely irrelevant as to what is the reason for its value as a currency, and why I believe bitcoin has as much staying power as gold. (ie lots).

[2] Gold has also, on occasion, been stamped with the picture of the king, signifying that it is acceptable within that kingdom in payment of taxes. This 'stamping' is functionally very similar to the 'fiat' laws we have in place today regarding the value of cash.

Interestinyly whenever gold was stamped, the gold traded for a higher value the metal value of raw gold of the same weight, though only within the kingdom in question, not internationally. Of course, from the King's perspective the neat thing about this was that the king could redeem value today by buying (or just taking) raw gold and then stamping it with their picture. Essentially they receiving value today from the future value of taxes that would be paid in that coin. This may be one reason why monarchs would so often call in all the gold in their kingdom, stamp it, and then send it back out again.

Incidentally, by continuing the analogy of gold and bitcoin, the government could also, today, retrieve value from their future taxes by stamping certain parts of the bitcoin chain with a cryptographic stamp indicating that they would be willing to accept those particular bitcoins as legal tender for taxes in future.. thus allowing them to buy bitcoins at price x, stamp them and then sell them for price y, higher than x. (Where market economics would suggest that the carrying capacity of (y-x)*n for the n bitcoins they do this to would be about equal to the future value of all taxes that people want to pay in bitcoins.)


Guvante 117 days ago | link

I 100% agree on the value of the grandparent post, which is why I commented when I felt his point was being diluted.

I would also agree that Bitcoin has a good chance as a commodity (I just don't have the right risk factors to invest) the only frustrating thing about Bitcoin is so many people talking about how Bitcoin needs to become a major currency.

The only thing negative I would say about your post is that you have to be really careful talking about inflation and deflation. Inflation is often put in a negative light because it discourages saving, but deflation discourages spending, which is much more dangerous. Which is why I don't have any faith that Bitcoin itself will become a currency, the deflationary problem is built in and part of the core.


contingencies 117 days ago | link

money-as-IOU vs money-like-gold distinction

... is false. Both represent the bearer trusting their economic society to pay back the debt for the original goods or labour for which the bearer exchanged for its acquisition, at some point in the future.


Super awesome can't wait to show this to my boy - he is super ready to move on from the programming at khanacadamy so am trying to learn him some game libraries. However he doesn't feel that comfortable outside of the nice KhanAcademy web environment, so using a lot of jsfiddle sessions is a great way to teach. Thanks!

PS jds375 comment about being sure to activate unsafe scripts (click at top right of address bar) is worth noting


soleimc 120 days ago | link

So glad to hear that you found this useful! Thanks for the compliment! =)


Secretary-General Kofi Annan actually tried to define terrorism at the end of his tenure... He suggested : "Any action constitutes terrorism if it is intended to cause death or serious bodily harm to civilians or non-combatants with the purpose of intimidating a population or compelling a government or an international organization to do or abstain from doing any act."

That would make the bombing of Dresden and Nagasaki (and any other bombing under the 'strategic bombing' doctrine where the objective was to drain the people's will to fight) to be terrorism, though. It would make some of what the ANC did terrorism. This, however, would not be terrorism.

I think Kofi Annan was bang on the money. About time we had a workable definition of the word (beyond just 'whatever the other guy does'). However he didn't get very far with it at the UN level.


malandrew 125 days ago | link

    "LeMay said, "If we'd lost the war, we'd all have been 
    prosecuted as war criminals." And I think he's right. He, 
    and I'd say I, were behaving as war criminals. LeMay 
    recognized that what he was doing would be thought immoral 
    if his side had lost. But what makes it immoral if you 
    lose and not immoral if you win?"
Robert S. McNamara, in the documentary series The Fog of War.

[0] http://www.errolmorris.com/film/fow_transcript.html


tehwalrus 125 days ago | link

International law is a joke when only people who lose wars are prosecuted.

(I have a lot to say on this point, but I'll leave it at that and point you to this[1])

[1] a series of three blog posts, old now and in need of rewriting:





EliRivers 125 days ago | link

I note that the definition there means that some of what were arguably the most effective bombings conducted by the IRA weren't terrorism. Which is nice.

http://en.wikipedia.org/wiki/1996_Docklands_bombing http://en.wikipedia.org/wiki/1996_Manchester_bombing


If you have backups of everything maybe you can get a decent level of business insurance that would see them replace your hardware should they take it and then take the time to wipe and replace with generic build before travelling if you are really worried about privacy?

It still totally sucks though, don't get me wrong.


This guy was unfortunate in tripping some sort of alarm for them. I've travel NZ<->US approx twice a year for going on 15 years now and have never so much as been stopped. I always ask for the frisk and grab rather than the microwave scanners (I'm thinking about the TSA folks who have to work there) and have been to many 'hacker' conventions while in the US and never triggered anything. I guess I fit a profile as a 'known'... rather than unknown. Maybe someone the guy spoke to at this conference is someone they genuinely want to know everything about. This doesn't make it OK but it's quite likely some specific thing that set it off for them

All of which to say you'll probably be fine and I don't imagine being a US vs NZ national will make any difference as to whether you get the stazi treatment or the wave through.

Also FWIW I'm usually a more worried about missing my flights due to unnecessary searches on the TSA side of things (combining a special breed of stupid with a dangerous type of wilful paranoia) than on the NZ side (more of your basic 'just following orders guvn'r' type of stupidity)


Dude on a practical level this might be your best bet.


utunga 127 days ago | link | parent | on: Facebook's AI lab

"Those who can't do, teach. And those who can't teach, teach gym.” - Woody Allen

Obviously it's an iterating/evolving meme.



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