Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Bitcoins: The Second Biggest Ponzi Scheme in History

garynorth.com

Post reply on HN
Print view View original

291–300 of 306 posts

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#291

Post by dredmorbius »

cynicalkane wrote: post #119
jseliger wrote: post #113

Earlier quoted context omitted.

Money develops out of market exchanges. Money was not used for its own sake initially, but it becomes widely used as money as a result of innumerable transactions within the economy This also doesn't appear to be true: see David Graeber's book Debt: The First Five Thousand Years for his descriptions of how money actually emerges from religious ceremonies and temples, not barter (as most econ books have it) or "market…

I wouldn't trust Graeber, as he is frequently wrong about easily verifiable facts in such a way that it supports his world view. There's no reason to trust a liar when he tries to tell you something you don't know about. My favorite Graeberism is when he describes the founding of Apple: > Apple Computers is a famous example: it was founded by (mostly Republican) computer engineers who broke from IBM in Silicon Valley…

2nd follow-up (can't edit my first). Wow, the DeLong piece is really epic. Graeber's caught in multiple errors (or faleshoods, or lies), gets epicly trolled by DeLong (a bit harsh, but ... on balance, called for), retaliates with taunting, name calling, and legal threats, anything but an "um, sorry, yeah, you were right", and ...

As I said before: Graeber's premise is interesting, but he's definitely tainted goods from here on out, and I'll have to verify any of his claims/statements before using them elsewhere.

Pity.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#292

Post by dredmorbius »

kylebrown wrote: post #259
jseliger wrote: post #113

Earlier quoted context omitted.

Money develops out of market exchanges. Money was not used for its own sake initially, but it becomes widely used as money as a result of innumerable transactions within the economy This also doesn't appear to be true: see David Graeber's book Debt: The First Five Thousand Years for his descriptions of how money actually emerges from religious ceremonies and temples, not barter (as most econ books have it) or "market…

I'm reading Graeber's book. The origin theory he settles on is that money was created by the state. Kings produced coins, gave them to soldiers, and mandated that the citizens accept the coins as payment for goods. This created a market, and solved the problem of how a kingdom could supply the needs of an army (weapons, clothes, and food). He does thoroughly deconstruct the barter origin story, by showing that barter…

Given the shadow thrown on Graeber's credibility, I'd say you'll have to treat him similarly to Wikipedia: not a credible primary source. I also found his origin-of-money passages fascinating, but would have to trace those to their sources before I'd believe them.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#294

Post by ubernostrum »

pretense wrote: post #272
ubernostrum wrote: post #153

Earlier quoted context omitted.

I hate to say this, but at this point when I see someone use the words "fiat currency" unironically, I also expect to hear an argument about gold fringe on a flag, and other similar easily-repeated cargo-cult phrases/arguments against whatever the person doesn't like. One of the real dangers to Bitcoin is precisely that sort of public image.

But doesn't your non-ironic use of "cargo cult" permit unbridled use of other meme-like absurdities ad nauseam? Like, now, I'm free to accuse you of being a secret agent of the notorious hacker group named Anonymous, infiltrating this site under an assumed pseudonym. And worst of all, I could make that claim non-ironically, if I so desired. Do you see how ridiculous this is all becoming?

The cargo cults which sprang up after WWII were based around imitating the behavior of the airfield staff, in hopes that doing so would summon the airplanes full of supplies.

Use of terms like "fiat currency" is, in my experience, similarly an attempt to mimic the behavior of people they've seen winning arguments, in hopes that doing so will result in winning arguments.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#295

Post by iterative »

empthought wrote: post #122
bmelton wrote: post #112

Earlier quoted context omitted.

I agree that BTC is not, but I thought it was fairly well understood that social security was a mandatory Ponzi scheme. From Wikipedia: "A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from existing capital or new capital paid by new investors, rather than from profit earned by the individual or organization running the operation." Social security does exactly that, and its rece…

Social security is a mandatory insurance program, not a mandatory investment program. Like any other insurance program, the solution to shortfall is to increase premiums or decrease payouts. Since there isn't yet a shortfall that can't be covered by existing funding sources, these solutions have not yet been implemented. Just like a private insurance company.

Social Security is a ponzi scheme. Insurance companies have assets the can fall back on to pay claims, they don't just pay them out of insurance payments as they come in.

http://www.forbes.com/sites/richardsalsman/2011/09/27/social...

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#296

Post by iterative »

parasubvert wrote: post #235
ashray wrote: post #172

Earlier quoted context omitted.

How many of those 'requirements' are because of powerful entities abusing the system? What are the forces that have caused those requirements to arise with traditional currencies? Did you mean inflationary spiral for Southern Europe? Or are prices for things dropping there right now? Not sure.. But again, a lot of what happens is because of constantly 'hacking' the system (raise the debt ceiling, print more money, et…

No one can realistically claim they truly understand the current system. The Austrian economists seductively claim this, but that's because they reject empiricism as a way of challenging their axioms. Keynes seems to have hit upon the most predictive model we have for how economies operate at scale with currency, especially how we can get into depression-like circumstances when internet rates are 0% like they have be…

If Keynes's predictive model was so good then why has every application of his theory, whether in the US in the 30's, 70's and now, Japan in the past couple of decades, etc. failed so miserably? On what basis are you claiming that Detroit's collapse was structural, rather than being caused by bad governance? Other areas of the US, and other countries for that matter, have seen their main industries decline, but they've managed to replace them with others without suffering the total disaster that Detroit as.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#298

Post by grey-area »

nwh wrote: post #127
grey-area wrote: post #125

Earlier quoted context omitted.

I don't need a description of how the one true digital currency works thanks, bitcoin is not the only way to produce a currency.

You asked why mining was necessary. I provided an explanation.

A digital currency requires arbitrary tokens as a medium of exchange.

It does not require peer-to-peer creation and verification of tokens. It does not require mining, it does not require pseudo-anonymous transactions and a distributed public ledger of all past transactions. Those are all properties of Bitcoin but not of currencies in general.

Bitcoin has some interesting ideas, but it's hardly the only type of digital currency which can exist and mining is a concept particular to Bitcoin (and spin-offs) - it has the effect of enriching the devs and early adopters and transforming it into an appreciating asset rather than a currency.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#299

Post by realo »

ceejayoz wrote: post #241
mschuster91 wrote: post #217

Earlier quoted context omitted.

Well, but the problem is: when is the money actually on your bank account? With BTC, as soon as the network mines a block with your transaction. With anything involving multiple banks or even cross-continent transfers, the delay will be >1 day minimum.

In my experience, debit/credit card refunds show up at my bank essentially instantly - my available balance reflects it within a minute the vast majority of the time.

Contrary to Bitcoins, your credit card does not scale.

Try to do a debit or refund of 150,000,000$ on your card. Cannot be done.

Bitcoin will happily do it's thing, either with 1$ or 150 M$ without discrimination, questions, etc... There lies the true power of Bitcoins.

Re: Bitcoins: The Second Biggest Ponzi Scheme in History

#300

Post by informatimago »

nimblegorilla wrote: post #177
jervisfm wrote: post #139

Earlier quoted context omitted.

> There will be an eventual cap at 21 million bitcoins. At the increasingly slow rate that coins are produced, this won't happen for some. But assuming that bitcoins are still around and in use at the point in time in the future when this happens, what will be the effect of this? The supply is fixed and no more can be produced; and since it's still around, chances are there is demand / usage that would likely grow. T…

Honest question: why are bitcoins scarce? I understand that the supply of real bitcoins is limited, but what is preventing all of the other cryptocurrencies from taking off?

It is an artificial scarcity embedded into the system AFAIK.

Or is there something that forces the null prefix lenght to change?

As an artificial scarcity, it strikes me similar to the king of an island who would collect all the shells, and distribut only a few of the as money.

Any would be king could start to collect square shaped pebbles, and do the same.

At least, the one who would choose to hoard coconuts would provide for money something that can be used, that has some intrinsic worth.

Post reply on HN