China's Central Bank Bans ICOs

You can maliciously use your paper money right there in your leather wallet to do all sort of criminal activity, should we ban regular money too?

I believe people will screw each other over no matter what system you use. In a regulated economy people will screw other people by lobbying for regulations that protect their industry from competition. In other words, centralized control via regulatory guardrails doesn't preclude exploitation: look at the opioid epidemic for example. It can in large part be traced back to doctors prescribing opioids as a result of pharmaceutical marketing. The industry is highly regulated and thus profitable for the pharmaceutical giants. The Drug War has been going on for a hundred years and drug abuse is worse now that it's ever been. I doubt that we would be any worse off in terms of drug abuse with a free market in drugs, and I'm sure there would be more competition and lower costs for drugs.

>>I hope you realise that todays "strict" food safety laws were born out of a world where people did exactly what you say they wouldn't. They cut bread with sawdust to make money. They skimped on hygiene. They advertised other meats than they used etc etc etc. Today these things have real consequences. You're saying we should just let people do that? I cannot fathom what drives you to that position.

People do that today as well. With a mandatory safety standard, you can probably raise quality in the short term, but there is a trade-off, in increasing costs and reducing innovation.

Regarding cost: it's not a given that reducing the incidence of food fraud is always worth the increase in food costs. I know it's not a intuitive idea, but sometimes the public welfare effect of increasing costs outweighs the public welfare effects of increasing quality. In a free market people will make a decision on what trade-off is best for them based on their own circumstance. Because it really does depend on the circumstances. Someone who values food safety more than low prices can always opt to buy a reputable label with a strong reputation for food safety. But for others, the lower cost of less reputable brands is more important for them than minimizing the risk of contracting foodborne illnesses or ingesting harmful additives.

With regard to innovation, regulation harms it because it replaces diversity with uniformity. Imagine a thousand food producers, each producing food of varying quality. With regulations, you get them all to use the same food safety procedures. This might mean that 70% of them raise their standards, but it also means the 10% creating innovative ways to maintain high quality standards at lower costs will stop exploring these avenues.

A modern day example would be how Uber found a more cost-effective way of assuring a high quality taxi service with its rating system than the regulatory approach of the medallion system that municipalities use. Taxi regulations, by imposing uniformity in procedures (the licensing process) on the taxi sector, caused the procedures used by taxi companies to stagnate and not evolve for decades. The quality difference between Uber and the regulated taxi services is night and day.

One other point I'd add is that the effect of reducing the rate of innovation is compounding. Over the long run, of 50-100 years, society will lose out immensely from trading recurring increases in innovation from a competitive free market for a one-time boost in quality from imposing a uniform standard for quality assurance.

The greatest force for improved quality and increased affordability is, in the long run, competition between entities free to innovate without the artificial constraint of mandates on their procedures.

Another reason to oppose regulations against the free market is that regulations are subject to being shaped by special interests, who may deliberately push for them to be onerous to stamp out smaller competitors. Many small farmers blame food production regulations for the demise of their sector and the growing dominance of industrial farming.

>>So there was no central authority and therefore the system failed. Isn't a weaker central authority what you want?

Not categorically. I want a strong authority maintaining security and the right to freely contract, but I want that authority to not use its power to infringe upon those same contracting rights.

>Anyway, this discussion is pointless if you cannot see that total free market idealism is as extreme as pure communism and equally flawed. The optimum is somewhere in the middle.

https://en.wikipedia.org/wiki/Argument_to_moderation

The Panic of 1873 was a financial crisis that triggered a depression in Europe and North America that lasted from 1873 until 1879 (1897 (!) in Britain)---6 years.

The 1882-1885 depression included a year when "an estimated 5% of all American factories and mines completely shuttered during the 12 months running from July 1, 1884, to July 1, 1885".

The panic of 1893 included a depression that extended to 1897, a couple of years with 12-14% unemployment, with peaks somewhere around 17-19% and 25% in Pennsylvania, 35% in New York, and 43% in Michigan, and included the panic of 1896.

Keep in mind two things: these occurred in the 19th century, when the United States was largely, perhaps almost completely an agrarian country, and that when banks fail (a common occurrence in many of these), you don't get your money back out.

The Great Depression is called that because it was the biggest, but it was hardly a completely new and unique thing.

[Now, as to Austrian economics, if "it is deductive from pure logic, rather than from experimental or statistical observations", I would think it had more in common with mathematics than either biology or psychology. Or perhaps alchemy.]

By making convertibility to Yuan illegal. This is trivially easy to do and enforce, making the entire Bitcoin marketplace a black market for any transactions on the mainland. So your life would get real hard real quick the moment you try to turn Bitcoin into Yuan. Oh, that's ok you'll just do ALL your transactions with bitcoin. Ok so any shop owner that makes it even slightly known that they take bitcoin will be arrested. Too easy.

Forget big C communist ideology at the state level, you mess with provinces and their ability to collect money and you'll go down hard fast.