Adam Smith Hates Bitcoin
krugman.blogs.nytimes.com
Adam Smith Hates Bitcoin
1–10 of 102 posts
Re: Adam Smith Hates Bitcoin
#2I think his previous statements are also significant.
"[bitcoin] has fluctuated sharply, but overall it has soared. So buying into [bitcoin] has, at least so far, been a good investment. But does that make the experiment a success? Um, no. What we want from a monetary system isn’t to make people holding money rich; we want it to facilitate transactions and make the economy as a whole rich. And that’s not at all what is happening in [bitcoin]."
Re: Adam Smith Hates Bitcoin
#3Krugman obviously don't know what he is talking about. The resources he is talking about are used to process the transactions between bitcoin owners. The mining is just a side effect.
How did a nobel prize winner made a so basic mistake on a topic that has been covered before by him so many times?
Bet one Btc that he did that on purpose.
Re: Adam Smith Hates Bitcoin
#4Krugman doesn't understand Bitcoin. The computing power expended on mining is used to secure the Bitcoin network.
There are many, many costs associated with securing the integrity of established financial networks too.
Re: Adam Smith Hates Bitcoin
#5Krugman obviously don't know what he is talking about. The resources he is talking about are used to process the transactions between bitcoin owners. The mining is just a side effect. How did a nobel prize winner made a so basic mistake on a topic that has been covered before by him so many times? Bet one Btc that he did that on purpose.
Krugman is an arrogant ass. He makes sweeping generalizations about topics he knows little to nothing about all the time.
Re: Adam Smith Hates Bitcoin
#6Krugman obviously don't know what he is talking about. The resources he is talking about are used to process the transactions between bitcoin owners. The mining is just a side effect. How did a nobel prize winner made a so basic mistake on a topic that has been covered before by him so many times? Bet one Btc that he did that on purpose.
In theory, yes you are correct. But you can't tell me all the computer resources that are spent on mining are required to process transactions. There are a whole lot of wasted cycles, electricity, and other resources.
Re: Adam Smith Hates Bitcoin
#7I think his previous statements are also significant. "[bitcoin] has fluctuated sharply, but overall it has soared. So buying into [bitcoin] has, at least so far, been a good investment. But does that make the experiment a success? Um, no. What we want from a monetary system isn’t to make people holding money rich; we want it to facilitate transactions and make the economy as a whole rich. And that’s not at all what…
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Re: Adam Smith Hates Bitcoin
#8Krugman obviously don't know what he is talking about. The resources he is talking about are used to process the transactions between bitcoin owners. The mining is just a side effect. How did a nobel prize winner made a so basic mistake on a topic that has been covered before by him so many times? Bet one Btc that he did that on purpose.
Whatever Kurgman says, it is good to keep in mind that he is an economist turned partisan-politics hack. Whatever he looks at, he looks at it from his lens of ideological reasoning.
His ideology clearly aligns with the status quo of economic policy, promoting quantitative easing and keeping up the artificial smokescreen of the superiority of the US dollar.
Therefore any competing ideas (e.g. gold, bitcoin) need to be disregarded, especially as economists by now have realized the importance of trust and its cognitive impact on markets.
Re: Adam Smith Hates Bitcoin
#9Krugman obviously don't know what he is talking about. The resources he is talking about are used to process the transactions between bitcoin owners. The mining is just a side effect. How did a nobel prize winner made a so basic mistake on a topic that has been covered before by him so many times? Bet one Btc that he did that on purpose.
In his defense, it was Krugman who identified in 2003, that we really needed to have a housing bubble, and advocated that we create one, because it would stimulate the economy.
And he was right- it did! Until it popped.
At the end of the day, Krugman is more a spokesperson for liberal politics than an economist. The liberals want to believe that unlimited spending is not bad, and so they put forth this narrative that it is actually good. They look to Keynes for support, but have to be very selective when they do.
Bitcoin is a currency that is not inflationary. Since unlimited spending is enabled with inflation, they see it as a threat.
What's kinda surprising, and amusing, is just how vocal and vociferous the objections to bitcoin have become in the last couple weeks.
This is not because economists recognize it will be a failure- after all, if it were to fail, they could just let it fail, no need to comment on it.
All of these stories, including this one, are indicators that the establishment economists feel threatened by bitcoin.
The reason is one they will never mention publicly - they can't control bitcoin, and they can't stop its adoption, short of draconian measures, and so it threatens their monetary regime.
Ironically if it wasn't for the mismanagement of the dollar, there wouldn't be much need for bitcoin anyway.
PS - Whenever you see someone pointing out that bitcoin dropped %XX in one day, remember the dollar has already failed twice in US history (eg: gone to zero!) and even the latest incarnation is down %98!
Re: Adam Smith Hates Bitcoin
#10I think his previous statements are also significant. "[bitcoin] has fluctuated sharply, but overall it has soared. So buying into [bitcoin] has, at least so far, been a good investment. But does that make the experiment a success? Um, no. What we want from a monetary system isn’t to make people holding money rich; we want it to facilitate transactions and make the economy as a whole rich. And that’s not at all what…
This is not what is happening right now. Fact.
BUT, if the project becomes mainstream as the dollar is today, the people of the earth will have a monetary system that doesnt allow taxation through inflation, with no banking monopolies, and globally available.
Isnt that a system that "facilitate transactions and make the economy as a whole rich"??
Consider this initial profit just by hoarding Bitcoin as a reward to put your own assets at risk in this uncertain beginning. Bitcoins can't exist (or anything else, matter of fact), if the people who supports it arent driven by selfish motivation.
I think it's fair that the people who risk themselves in the beginning are awarded, if Bitcoin succeeds.