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Offline Empirical1

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BitGold and gold in general side discussion...
« on: February 28, 2014, 04:03:23 PM »

I mentioned adding gold in the Bitshares update thread and suddenly had a few guys jumping in trying to claim that gold has about as much value as fiat currency  :o Or that it was immoral as it could be hoarded  :o

Anyway rather than derail the important BitsharesX update thread I thought I'd move the discussion over here.

The last response was this one...


Personally, I don't know why gold is relevant. I have never looked to the price of gold to value anything, especially not crypto currencies. The markets will work best when participants are most informed and the underlying asset isn't prone to its own instability. I obviously think that gold should be incorporated later, but as for the test chain the underlying assets should be those that ppl are most comfortable valuing. The ttest chain should also have as few assets as possible. One would suffice but it is very important to include the Chinese community

 +5%

Not only is gold a dumb currency, It's immoral.  People that hoard it and store it in the ground, instead of letting it contribute to society and life do so much destruction to otherwise possible life.  Every time I have to pump my car clutch in the morning, to get it to make a clean electrical connection (because it's too expensive to use gold in the switch) I cures the selfish bastards.

Immoral because people can hoard it?

1. By hoard you actually mean the fact that people can save it, and maintain their value without being forced into our current corrupt system. (Which right now is so bad, inflation is actually higher than the interest you'd get in most savings accounts.)

2. You know that also means your against Bitcoin? Bitcoin is a deflationary currency which lets people do the same thing.
The opposite is happening to your argument, the more people use Bitcoin the more it is spent not hoarded.
Also if you look at America from 1800-1913 they rose rapidly to become the most successful & biggest creditor nation in the world using gold. I don't think I need to explain to you how things are now pretty much the exact opposite now, a hundred years on in a world where the dollar has lost 96% of it's original value.

Introducing a central bank was bad enough but at least they had some link to gold.
Look what happened after the dollar left the gold standard completely.
Only one small group has ever benefited from fiat/inflationary currency...   



Offline valtr

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Re: BitGold and gold in general side discussion...
« Reply #1 on: February 28, 2014, 04:07:31 PM »
Quote
Immoral because people can hoard it?

1. By hoard you actually mean the fact that people can save it, and maintain their value without being forced into our current corrupt system. (Which right now is so bad, inflation is actually higher than the interest you'd get in most savings accounts.)

2. You know that also means your against Bitcoin? Bitcoin is a deflationary currency which lets people do the same thing.
The opposite is happening to your argument, the more people use Bitcoin the more it is spent not hoarded.
Also if you look at America from 1800-1913 they rose rapidly to become the most successful & biggest creditor nation in the world using gold. I don't think I need to explain to you how things are now pretty much the exact opposite now, a hundred years on in a world where the dollar has lost 96% of it's original value.

Introducing a central bank was bad enough but at least they had some link to gold.
Look what happened after the dollar left the gold standard completely.
Only one small group has ever benefited from fiat/inflationary currency...   


+5%
« Last Edit: February 28, 2014, 06:57:59 PM by bytemaster »

Offline bytemaster

Re: BitGold and gold in general side discussion...
« Reply #2 on: February 28, 2014, 07:27:48 PM »
1)  Hoarding is just another word for saving and by throwing that term around with the implication that it is *bad* is a form of logical fallacy and appeal to emotion.    I am considering turning on AUTO REPLACE of Hoarding with Saving everywhere in the forum.

2) Spending Gold doesn't give it value any more than Saving gold.  Society is all about voluntary exchanges and one person choosing not to exchange is perfectly VALID and fundamentally based upon property rights.  It would be immoral to compel them to take any other action.  Most people don't complain about someone "hoarding" their wife who could other wise be contributing to economy. 

3) Bitcoin is not deflationary, it is 12% inflationary when viewed entirely from the monetary definition of inflation.  The fact that demand is growing faster than supply masks the consequences of inflation (rising prices).   On these forums lets stick with monetary inflation.    Inflation is no different than a company issuing new shares and it transfers value from the current share holders to new share holders.   Whether this is immoral or not depends upon who benefits from the issuance.   If a company issues shares in exchange for a capital infusion then the value of the original shares goes up despite being a smaller percentage.   On the other hand, if a company grants their buddy shares with no meaningful consideration then the value of the company does not increase.   

   When money is viewed as an equity or share of the economy, then you realize we are all minority shareholders.   The immorality comes as a result of Shareholder Oppression http://en.wikipedia.org/wiki/Shareholder_oppression where the 'majority' can make decisions that harm the minority.     Unfortunately with USD the shareholders don't even get a vote.  In the case of Bitcoin the shareholders agreed to the terms which were hardcoded into the blockchain and thus it is not immoral.
   
   So if you are going to define something as immoral please confine it to cases where someone violates the principle "don't do unto others what you don't want them doing unto you".   

   In the case of Bitcoin you realize the same problem that dollar holders have... those that make the decisions have a different class of stock than those whom the decisions effect.   Namely, a bitcoin can be viewed as a share without voting rights and all voting rights are allocated to a different kind of share called 'hash power'.   This is what makes proof-of-stake better in principle and practice:  voting rights are not separated from economic rights. 

   In my opinion Brent is the one being a 'selfish bastard' by demanding someone else be 'selfless'.   See the irony in demanding someone be "selfless" (by selling gold below what it is worth to them) so that you can personally gain?    Brent is a great guy and I mean him no disrespect personally.  I just have to demand truth and objectivity in discussions like this. 
     
  The reason for using BitGold, BitUSD, and BitBTC is because they represent the 3 primary categories of currency.  Of the three I suspect only one of them will have value lasting longer than BitShares X itself.... BitGold.    BitUSD will hyper-inflate and BitBTC will fall due to increasing competition from BitAssets which have greater price stability.   


« Last Edit: February 28, 2014, 07:29:26 PM by bytemaster »
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Offline toast

Re: BitGold and gold in general side discussion...
« Reply #3 on: February 28, 2014, 07:48:43 PM »
I am considering turning on AUTO REPLACE of Hoarding with Saving everywhere in the forum.

LOL yes
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Offline Empirical1

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Re: BitGold and gold in general side discussion...
« Reply #4 on: February 28, 2014, 08:12:15 PM »
 +5%



3) Bitcoin is not deflationary, it is 12% inflationary when viewed entirely from the monetary definition of inflation.  The fact that demand is growing faster than supply masks the consequences of inflation (rising prices).   On these forums lets stick with monetary inflation.   
   

Yes you're right, I'll stick to monetary inflation from now on.
(I was yes, referring to the fact that demand would likely grow faster than supply, similarly even gold is slightly inflationary in the sense that new supply is extracted each year.)

On a side note, I'm also a big fan of POS over POW as POW leeches value via inflation from users and gives it to a small group of hashers. I  know the original intention was to incentivise them to decentralise the network but because they point their hashing power to large pools they don't even really do that. 


The reason for using BitGold, BitUSD, and BitBTC is because they represent the 3 primary categories of currency.  Of the three I suspect only one of them will have value lasting longer than BitShares X itself.... BitGold.    BitUSD will hyper-inflate and BitBTC will fall due to increasing competition from BitAssets which have greater price stability.   
   

 +5%

Offline 70231f697a2b3c2b

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Re: BitGold and gold in general side discussion...
« Reply #5 on: February 28, 2014, 08:28:22 PM »
I am HOADRING my BitShares!

Offline santaclause102

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Re: BitGold and gold in general side discussion...
« Reply #6 on: February 28, 2014, 09:52:32 PM »
1)  Hoarding is just another word for saving and by throwing that term around with the implication that it is *bad* is a form of logical fallacy and appeal to emotion.    I am considering turning on AUTO REPLACE of Hoarding with Saving everywhere in the forum.

2) Spending Gold doesn't give it value any more than Saving gold.  Society is all about voluntary exchanges and one person choosing not to exchange is perfectly VALID and fundamentally based upon property rights.  It would be immoral to compel them to take any other action.  Most people don't complain about someone "hoarding" their wife who could other wise be contributing to economy. 

3) Bitcoin is not deflationary, it is 12% inflationary when viewed entirely from the monetary definition of inflation.  The fact that demand is growing faster than supply masks the consequences of inflation (rising prices).   On these forums lets stick with monetary inflation.    Inflation is no different than a company issuing new shares and it transfers value from the current share holders to new share holders.   Whether this is immoral or not depends upon who benefits from the issuance.   If a company issues shares in exchange for a capital infusion then the value of the original shares goes up despite being a smaller percentage.   On the other hand, if a company grants their buddy shares with no meaningful consideration then the value of the company does not increase.   

   When money is viewed as an equity or share of the economy, then you realize we are all minority shareholders.   The immorality comes as a result of Shareholder Oppression http://en.wikipedia.org/wiki/Shareholder_oppression where the 'majority' can make decisions that harm the minority.     Unfortunately with USD the shareholders don't even get a vote.  In the case of Bitcoin the shareholders agreed to the terms which were hardcoded into the blockchain and thus it is not immoral.
   
   So if you are going to define something as immoral please confine it to cases where someone violates the principle "don't do unto others what you don't want them doing unto you".   

   In the case of Bitcoin you realize the same problem that dollar holders have... those that make the decisions have a different class of stock than those whom the decisions effect.   Namely, a bitcoin can be viewed as a share without voting rights and all voting rights are allocated to a different kind of share called 'hash power'.   This is what makes proof-of-stake better in principle and practice:  voting rights are not separated from economic rights. 

   In my opinion Brent is the one being a 'selfish bastard' by demanding someone else be 'selfless'.   See the irony in demanding someone be "selfless" (by selling gold below what it is worth to them) so that you can personally gain?    Brent is a great guy and I mean him no disrespect personally.  I just have to demand truth and objectivity in discussions like this. 
     
  The reason for using BitGold, BitUSD, and BitBTC is because they represent the 3 primary categories of currency.  Of the three I suspect only one of them will have value lasting longer than BitShares X itself.... BitGold.    BitUSD will hyper-inflate and BitBTC will fall due to increasing competition from BitAssets which have greater price stability.

Good points there.

How can BitGold last longer than Bitshares X when BitGold can only exist within Bitshares X?

Quote
Hoarding is just another word for saving and by throwing that term around with the implication that it is *bad* is a form of logical fallacy and appeal to emotion.    I am considering turning on AUTO REPLACE of Hoarding with Saving everywhere in the forum.
Methodologically it is equally bad to prove the negative effect by a negative connotation as it is to proof its positve effect by positive connotations...
I think what was meant here was that if there is no effective way to save/hoard value without giving it to others so that they can create value from this investment then it stimulates economic grows and overall benefit.

Offline bytemaster

Re: BitGold and gold in general side discussion...
« Reply #7 on: February 28, 2014, 11:43:21 PM »
Quote
Methodologically it is equally bad to prove the negative effect by a negative connotation as it is to proof its positve effect by positive connotations...
I think what was meant here was that if there is no effective way to save/hoard value without giving it to others so that they can create value from this investment then it stimulates economic grows and overall benefit.



With out supporting explanation "Savings" being deemed positive is an assumption just as faulty as "Hoarding" being deemed negative.  So lets get to the heart of the issue that is independent of any particular judgment call.     

The act of saving transfers value to others far more effectively than the act of spending the money on 'investments' (anti hoarding).  By removing an item from circulation you increase the demand for that item which means that the price of that item relative to everything else will increase.   This price increase causes the remaining items to be put to their highest possible use.   In the case of money, it means the remaining money gets put to the HIGHEST POSSIBLE USE and thus best possible investment.  It means everything else gets cheaper which makes everyone else's money more valuable allowing them to purchase the means of production more cheaply.  Thus money is put to the HIGHEST POSSIBLE USE by the market. 

In effect, someone saving money is investing in the entire economy.   Put another way, money is a claim on goods and not an end in itself.  By holding money rather than consuming goods you make those resources available to others.    If you have steady predictable deflation and everyone is saving, the only people that will invest in the production of goods are those who believe they can add more value than the average returned by deflation.  This will in turn be a solid measure that these are good investments.  Anyone who can only invest at or below 'average deflation' is actually hurting the economy due to opportunity costs.  Note that deflation implies that the economy is producing more and more goods for less and less money.   The opposite (price inflation) implies the economy is producing less and less goods for the same amount of money. 

The alternative to saving is called speculating and unless you know what you are doing chances are you will be less effective than the rest of the market and end up consuming capital in your attempt to invest in something you don't have time to fully understand.   

Conclusion: saving makes capital available for the market more effectively than direct investment for the vast majority of people.

Lastly, I can also prove 'hoarding' is derogatory based entirely on the morality of what is implied by taking actions to discourage it.   

You know how you discourage hoarding of one resource?   Create something more valuable than the hoarded resource and trade them for it :)
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

Offline puppies

Re: BitGold and gold in general side discussion...
« Reply #8 on: March 01, 2014, 12:08:52 AM »
http://www.youtube.com/watch?v=iM_Ls46_tB8

Every time I reflect on it, I am amazed at how spot on Bastiat is even after all this time.

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