2019 and 2020 books are in the
Odds and Ends
It's important to know what you like
24 5, 8:05pm
1) cost of forgery will go down with rising availability of sufficiently powerful lasers and CNC machines. Anything that can precisely mill and melt copper will do the same with gold. Forming tungsten to fit inside the coin is difficult part, but I'm sure that given enough demand China will, as always, provide.
2) "Electronic transfer of ownership requires a third bank-like party, there is no way around that. I know thou art in love with Bitcoin but as I have also repeatedly said, it is not connected to reality, and if it were connected to realty then the thing whose ownership is being transferred have to be in some physical location."
If it's an ownership of bitcoin, then transfer happens in decentralized ledger, so only a sender, a receiving address and connection to the net are required. In this sense cryptocurrency is as connected to reality as any written word that distributed across millions of copies which can be compared to each other and no single entity can change it unilaterally. Decentralized exchanges, service like localbitcoins or bitcoin ATMs mean that it's as close to peer-to-peer network in real life as currently possible.
"Gold is the hardest thing in the world for government to confiscate because it is so easy to hide, which is why they usually don’t bother, unless it is for a particular large horde, one worthy of a dragon"
As long as someone knows that you had it or if you used it to buy something then you become an opportunity for a snitch or a sting operation. Trying to leave the country means that you're either have to pass through a border check point, so search is inevitable, or cross it illegally which is difficult by design. If full martial law is in effect, then even moving your stash is a risk since you can be subjected to a search at checkpoint or random search. If rule of law has deteriorated sufficiently, intimidation, torture or other measures of varying legality are on table. You can read plenty of stories about people trying to leave dangerous parts of Ukraine and being kidnapped, tortured, held for ransom.
3) "25 kg is harder to carry but still possible, but the smartest thing in that situation will properly be to bury it in many different places."
Funny thing is, that's exactly what my grand grandfather did - he had some unspecified valuables buried somewhere during dekulakization. He was very tight lipped about this, wanted to outlast Stalin or at least leave it all to my mother. One slight problem - he died in 1950s fast enough to be unable to reach anyone he could trust with information. To this day there is not even a slightest idea about at least general area where that stash was buried.
"A thug can’t put a farm in their pockets and then look the other way the way they can with a couple of gold eagles."
On the other hand, offer of bribe is an indicator that you may have more. There is no way to win in situation like that unless one escapes early, finds security through obscurity or collaborates.
4) "Thou cannot control inflation. 98% of all currency in circulation is in the form of bank deposits Only 2% is M0 physical base currency. If people don’t borrow and banks don’t lend the money supply shrinks even if M0 doubles or triples."
Fiscal policy, immediate borrowing, or interest rate and reserve requirements set by FRS. Direct money injection is an option to control deflation.
"And then we haven’t even taken the velocity into consideration that have a lot to do with peoples mood."
Technically, it can be affected by promise of changes in policy or credit availability. Quality of policy design in this case is paramount, as well as ability to pass appropriate legislation. Gold standard and absence of fractional reserve banking make that problem worse.
"A hyperinflation starts the moment a currency goes from something to be treasured to a hot potato that one have to get rid of as fast as possible."
US already handled inflation rates as high as 14% between 1970 and 1980, including stagflation. Granted, at 20%+ death spiral may become more difficult to overcome, but with enough political will solutions are available.
5) "The British recession following world war one was caused by dishonesty, they had printed a lot of pound but thought that they could be held at the same price as before the war. Had they devalued the pound properly to what it now were worth there wouldn’t be a deflation. "
Deflation, is by definition, a situation when currency is overvalued. Being able to print more money and still have a deflation requires an interesting set of circumstances.
"Sucks more to be a bitcoin “investor”"
No, it really sucks in general to live in a relatively unstable period in history and have a desire for stability. At this point frequency of innovation shocks should be rising, so number and importance of decisions will only increase.
"Because if Bitcoin can’t provide that, (and it can’t) then people will abandon it, when they need their money for something more pressing."
Same goes for anything else. So far ease of access and increasing attention means that there is always a buyer. Biggest threat to long-term success of bitcoin is in several technical difficulties, but it seems that decision to sort them out is now being reached. Another big problem is dependence on China, but with growing acceptance in US and access to markets in Korea and Japan it will be reduced.
"I understand that thou feel smug, because thou art ridding a bubble up at the moment,"
I really don't. For legal reasons I cannot confirm or deny if there are any positive side effects from my (hypothetical, for legal reasons of course) hobby, but I see a lot of potential in blockchain technology on it's own.
"but I have seen the peak and I know what lies in the bottom."
Rise, correction, flatline, as usual. Unless something makes blockchain completely obsolete, but at this point some people are already thinking about possibility of quantum-resistant cryptocurrency.
"only gambling with the houses money at this point"
At this point any investment in (hypothetical, of course) hardware has been paid off, I don't have to spend anything other than my time. Return on that investment is, hypothetically, very encouraging.
6) "The point of the Mac is not that it should be an investment, it is not supposed to give a return on investment, it is supposed to be money and maintain its purchasing power."
But it will not, because relative to other options it's value will change. Same can be said about bimetallic standard, for example. If you have a reserve that consists in equal parts by value of gold and silver, given enough time changes in availability and utility may lead to one part of reserve having, say, 90% of value. Add to that possibility that total value of reserve relative to some basket of goods can decrease by 10% at the same time. If you're going to assign arbitrary value to a unit of gold, peg silver to it and everything else to bimetallic standard, then it's not much better than assigning arbitrary value to any other item purity and availability of which can be reasonably controlled. In this case physical existence of unit is only a matter of convenience, as long as you can achieve immutability and controlled emission by some other means.
7) treating metals, precious or not, as investment is something I can easily agree with. Problem is that a lot of goldbugs overestimated this asset in 2010-2011 and are now in the same position in which bitcoin enthusiasts were in 2014 or 2015. Well, at least bitcoin's exchange rate recovered, I'm not so convinced about gold or silver yet.