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The “It’s Libertarian So It’s Bad” Argument Against Bitcoin

A very silly piece from the Business Insider is making
the rounds this morning for those who wish to stand athwart the
digital future sneering “but it’s libertarian.” (The
article has pretty much no intellectual value for anyone else.)
(For an earlier take on people who have a hard time swallowing the
libertarian implications and practice of the digital past, present,
and future, see
this from me earlier this week.)

The article by Jim Edwards posits that “Bitcoin
Proves the Libertarian Idea of Paradise Would be Hell on
Earth,” with a bill of indictments against the surging digital
currency that applies in pretty much every respect to any currency
at all.

Criminals can use it! It can be stolen! (We all have things that
are valuable to us on our hard drives. Bitcoin may end up being the
most valuable thing lots of us have on our drives,
but—back up, back up, back up. Undoubtedly a trustworthy and
robust system of outsiders serving the function of digitally
storing your wallets on other than just your harddrives will become
common, just like pretty much every other valuable human need gets
met by the market. Like every human endeavor, some crooks might get
involved as well, naturally.)

Edwards is right, let’s just return to barter…this whole
“currency” thing seems toooo risky.

Edwards also gives way too much importance to
a supposed bug in the system that might allow colluding miners
to cut out other miners (a problem that is probably fixable in the
open-source debuggable Bitcoin system and that need not destroy the
value of the currency to most users), and then gives even more
scary attention to the notion that people can use Bitcoin as a tool
to commit crimes, in case you didn’t get it the first time and
repetition might make it start to scare you.

He also is incensed that due to the nature of how it has rolled
out, a small number of people have a lot of Bitcoin. This has
little to do with its value as a means of exchange, unless he is
imagining a world where suddenly the only thing that has value is
Bitcoin and those of us lacking it are screwed. And for someone so
worried about centralized power and manipulation of currency, he
doesn’t seem to have thought a lot about the Federal Reserve’s role
in the economy, even though circumventing it is one of the
libertarian joys of Bitcoin.

Edwards hits on one point that, right this second, makes Bitcoin
less than ideal as a currency: its huge day to day fluctuations in
value in relation to all other monies and commodities in the world.
It seems obvious to me that we are seeing lots of churn in Bitcoin
based on people seeking in it not a currency but an investment
vehicle, because of its huge zooms in value very recently.

We are still in the beginning of the world understanding how it
wants to use digital currencies, and I would expect that in the
near future we will see far more stability in Bitcoin’s day to day
value–though where this level will be in terms of the U.S. dollar
is impossible to say.

What seems easy to say is that for anyone who has ever tried to
transfer money, nationally or internationally, that the values in
ease, speed, and cost of digital currency means that it will have
the same leveling effect on industries like banking and finance
that depend largely on their middleman function that already we’ve
seen happen in book sales, video rentals, and travel agents.

People who doubt this are letting their ability to write Bitcoin
and other digital currencies off as “libertarian” blind them to
economic trends of the past 20 years in the digital age. If you can
understand the value of, say, PayPal, then you already understand
the value of Bitcoin; except Bitcoin doesn’t have a middleman
skimming.

The Internet has made life very unstable for those who made
their living as middlemen skimming–even more unstable than the
recent day to day value of Bitcoin.

Yes, it’s decentralized, hard to control, hard to tax, arising
from the free play of the market rather than government
command–it’s pretty libertarian stuff. The world can be, at its
best, a pretty libertarian place. Don’t let that scare you away
from the future, libertarian haters. (Or go ahead! See if I
care!)

For more on Bitcoin from a libertarian perspective, see
this great essay by John Mather defending it from old-school
Austrian economists who see it as essentially a non-money, and a
Ponzi scheme.

Reason on Bitcoin, and our recent December feature by
Jerry Brito on the many
uses for the Bitcoin protocol besides a currency.

from Hit & Run http://reason.com/blog/2013/12/11/the-its-libertarian-so-its-bad-argument
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Obamacare Is Supposed To Sign Up 7 Million By March – 365,000 So Far

Submitted by Jim Quinn of The Burning Platform blog,

The MSM is trying to spin the 110,000 sign ups in November as a fantastic result. When a “free” new entitlement is announced and rolled out in this country, they would normally be knocking down the doors to sign up. Anyone who really wants Obamacare has already signed up. The first two months should generate the biggest numbers. When you have only achieved 5% of your goal after two months, you’ve failed miserably. Obamacare is a disaster before it even gets off the ground and bankrupts the country. Young healthy people will never sign up for Obamacare. They know it’s a scam. They also know that Obama and his IRS minions are so incompetent, they’ll never figure out how to collect the fines from people who don’t sign up. Have you ever met an IRS employee?

But, the MSM will do their darndest to mislead the public about Obamacare success.

Behind Obamacare figures

The latest figures on Obamacare enrollment are out, and they have better but not great news for the White House. The stats show that Obamacare enrollees who have selected insurance plans through the federal HealthCare.gov website quadrupled from October to November, but other figures don’t show growth that rosy.

HHS figures show that HealthCare.gov enrolled 110,410 new consumers in health plans last month, more than four times that of the 26,794 signed up during October, as the troubled website started to work out the troubles it experienced from its inception Oct. 1.

Growth in the number of people processed through the system wasn’t as sharp. HHS figures indicate that 822,789 consumers were deemed eligible for health plans last month, up 17% from the 702,619 reported for October. The pace of those who completed applications for health coverage was slightly better, with November postings of 1.23 million, up 19% from the 993,635 reported for October.

Further, activity slowed significantly on both the federal and state marketplaces, though some of that wane can be attributed to initial heavy interest. After nearly 27 million unique users clamored to HealthCare.gov and the state websites in October, that slowed down to roughly 12.2 million in November, a drop of 54%. Calls to the various service centers dropped to 2.1 million from 3.2 million, falling by a third.

HHS officials said nearly 365,000 people have selected health plans from state and federal marketplaces since Oct. 1, with nearly two-thirds of that coming from the states. The number of federal marketplace enrollees deemed eligible for coverage is twice that of the state-run exchanges — at 1.5 million vs. the states’ 780,000.

In addition to the 365,000 nationwide sign-ups, more than 800,000 were deemed eligible for Medicaid or the federal Children’s Health Insurance Program. HealthCare.gov serves 36 states, while the 14 other states and the District of Columbia run their own exchanges.

HHS hopes to enroll 7 million people in health plans by March 31. It has been hampered severely by troubles with HealthCare.gov, which it says is operating smoothly for the bulk of consumers visiting the site.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/8v_h99lqECs/story01.htm Tyler Durden

A. Barton Hinkle Says More Contraception, Less Conscription

In a rational world, women in the U.S. would be
able to buy birth control over the counter — something that is
perfectly safe to do, and that women in other countries do as a
matter of routine. But, says A. Barton Hinkle, because American
women cannot, the country is now embroiled in an unnecessary debate
— one that, exacerbated by tendentious red-team/blue-team
cheerleading.

View this article.

from Hit & Run http://reason.com/blog/2013/12/11/a-barton-hinkle-says-more-contraception
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Dan Loeb Takes On Santa Claus

The following Third Point letter may or may not have been actually sent, although if indeed shareholder activists – more aggressive now than ever thanks to the brilliant idea of forcing management teams to lever themselves up to the gills with what for now appears to be cheap credit – do get some original ideas thanks to this particular Vanity Fair lampoon, then children around the world will have a fabricated Dan Loeb to thank for having their Christmas presents delivered by an army of highly efficient and profit-maximizing Amazon drones.

Source: a rather humorous Vanity Fair

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/xhu4iEozHuI/story01.htm Tyler Durden

Last Day of the Reason Webathon! Let’s Make That Box Orange, People!

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$3,800 (or its equivalent in Bitcoins)
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from Hit & Run http://reason.com/blog/2013/12/11/last-day-of-the-reason-webathon-lets-mak
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US Stocks Slammed; Retrace Payroll Gains

But…we have a deal in DC?! As the safety bid for bonds and bullion continues, stocks are greatly rotating lower, retracing all the post-payrolls (taper is a good thing) gains. Perhaps more notably, attempts to juice stocks with EURJPY are failing (for now)…

Retraced…

EURJPY not working…. But AUDJPY is…

Charts: Bloomberg

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/szz7OL9auCQ/story01.htm Tyler Durden

Speaker Boehner Explains The Budget "Deal" – Live Feed

A modest cut in the slowdown of the growth of debt in the most indebted nation on earth is being heralded as a ‘win’ by many (even if the ‘market’ is entirely ignoring it). We leave it to Speaker Boehner to explain the “compromise” but remind readers that the extension of emergency claims is off the table (for now) and thusly, the unemployment rate is about to drop notably – providing the Fed the cover (along with this fiscal ‘tailwind’) to spin a tale of taper sooner rather than later.

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/NZzYjCLog_s/story01.htm Tyler Durden

Speaker Boehner Explains The Budget “Deal” – Live Feed

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/NZzYjCLog_s/story01.htm Tyler Durden

Some Stunning Perspective: China Money Creation Blows US And Japan Out Of The Water

With private sector loan creation in the US and Japan virtually unchanged since Lehman levels (and the US in danger of posting a negative comp in a very months) and Europe loan creation contracting at a record pace, it falls upon the Fed and Bank of Japan (and possibly the ECB soon) to inject the much needed credit-money liquidity into the system. And, as everyone knows, month after month the Fed and the BOJ diligently create $85 billion and $75 billion in new outside money out of thin air (that this “credit” ends up in the stock market is a different topic).

So to help readers get a sense of perspective how the US and Japan compare when matched to China, below we present a chart showing the fixed monthly “money” creation by the Fed and the BOJ compared to the most comprehensive money supply aggregate available in China – the Total Social Financing – for the month of November. The chart speaks for itself.

Basically, while everyone focuses on the breakneck money creation by the Fed and the BOJ, what happened in the past month is that China quietly created some 20% more money. Perhaps most impotantly, between these three entities, nearly $400 billion in liquidity was created de novo in one month! Because when the entire world is a credit-fueled ponzi scheme, these are the kind of numbers that matter.

For those curious, here is a more detailed breakdown of the Chinese numbers from Bank of America.

New bank loans and TSF rebounded notably in November

Despite higher and volatile interbank rates and rising bond yields, credit growth remained quite robust towards year-end. Two most watched data points, new bank loans and Total Social Financing (TSF), rebounded notably to RMB625bn and RMB1230bn respectively in November from RMB506bn and RMB856bn in October. YoY bank loan growth remained unchanged at 14.2%, while yoy outstanding TSF growth moderated to 19.5% from 19.7%. Today’s money & credit data should be positive for markets which have been worried that the PBoC could tighten credit supply to reduce leverage by citing rising bond yields and interbank rates.

Details of TSF: All financing activities accelerated

New entrusted loans rebounded notably to RMB270bn in November from RMB183bn in October, while new trust loans increased to RMB102bn from RMB40bn.
New corporate bond rose to RMB138bn in November from RMB107bn in October. We note that government and coporates delayed their bond issuance or scaled down the size after bond yield soared, but the net corporate bond issuance in TSF still rebounded due to a smaller amount of expiry in November from October.
New FX loan edged up to RMB12bn in November from RMB5bn in October.
Non-discounted bankers acceptance (BA) increased by RMB6bn in November after falling RMB40bn in October. We think the monthly numbers are particularly volatile, and there is no need to overly-interpret it (This is also the reason why we exclude it from calculating our revised TSF growth.)

Loan details: demand for working capital remained decent

New MLT corporate loans fell to RMB86bn in November from RMB144bn in October. Concerning seasonality, the number is not low. Note that it dropped to –RMB3bn in November 2012 from RMB169bn in October 2012 despite supportive policies and recovering growth momentum then. We believe policies would remain relative neutral in coming months and there could be no sudden reversal of policies.
New short-term corporate loans rose to RMB241bn in November from RMB215bn in October. Meanwhile, discounted bills also increased by RMB19bn after falling RMB71bn. It suggests loan demand for working capital remained decent.
New MLT loans to household (mainly mortgage loans) rebounded to RMB182bn in November from RMB154bn in October, supported by strong home sales momentum in previous months. New short-term loans to households rose to RMB80bn in November from RMB51bn in October, reflecting that SME loans could remain supported.

* * *

So how long before the developed and developing world “have” to create $1 trillion or more in money supply each month to keep the house of cards from toppling?

via Zero Hedge http://feedproxy.google.com/~r/zerohedge/feed/~3/3lToNGkt1XQ/story01.htm Tyler Durden

Rand Paul's Sham Plan to Save Detroit

If Nixon deserved points for going to China, Rand Paul deserves
points for going to Detroit — and trying to convert the GOP
from a pasty white guys’ party to a multi-hued one where everyone,
even people with “pony tails, tattoos and earrings,” are
welcome.

But his actual plan to try and save Detroit by creating Economic
Freedom Zones, I note in the Washington Examiner this
morning, is simply old garb with new accessories. It’s basic
premise that it is not government but entrepreneurs who can revive
economic basket cases like Detroit is obvious to everyone (except
liberals, communists and the Pope). But the problem is that the
lovers of America’s regulatory state will never unshackle
entrepreneurs and let them work their magic as this plan would
require. I note:

This approach worked well in England,
turning London’s depressed docklands into a super-dynamic hub for
finance and other businesses in the 1980s. It also transformed
India’s
Bangalore from a sleepy little town (that Winston Churchill once
compared to a prison) into a global IT powerhouse in the 1990s.

But it has been a disappointing failure in America. Why? Because
neither Republicans nor Democrats have ever managed to create
anything resembling a genuine enterprise zone.

Go
here to read the whole thing.

from Hit & Run http://reason.com/blog/2013/12/11/rand-pauls-sham-plan-to-save-detroit
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