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Bitcoin and Intrinsic Value: a Layman’s Response to Alan Greenspan

"Once upon a time, at the end of the last millennium, I founded and led the first games company to sell virtual goods or virtual currency for real money. We sold (and still sell) ‘credits’ – virtual currency that is bought for real money, which players can use to buy other things in our games. When I first started selling credits, a lot of people, including almost everyone in the games industry who was aware of what we were doing, thought it was ridiculous. The general criticism was along the lines of: 'Why would someone pay real money for a fake sword?' 16 years later, people are still buying these credits, and they’re even used to pay other people for third-party services around our games." Continue reading →

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Bill Bonner: Don’t Invest Here in 2014…

"'Prices are very unreliable. So, we just look at what surprises might come… and what impact they will have on us. I mean, I know I will be surprised. So I want a surprise that I will like. And the way you get that is by making sure you always have more upside than downside. You look at the US stock market now and what you see is millions of people who are all sure that the market is going up… as long as the Fed continues to add money to the system. When the Fed stops, they think they are going to get out. But when everyone wants to sell, who will they sell to? So, in our view the surprise is likely to be on the downside… and it will be much more painful than a surprise to the upside.'" Continue reading →

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Jim Rickards: Decline of the Petrodollar System is Good for Gold

"The petrodollar system is collapsing for two reasons. The US has abused its privileged reserve currency position by printing trillions of dollars in an effort to create inflation. More recently, President Obama has taken steps to anoint Iran as the regional hegemon of the Middle East, and to ease the way, in stages, toward Iran's possession of nuclear weapons capability. This is viewed as a stab-in-the-back by the Saudis and the Israelis and will lead quickly to Saudi Arabia obtaining nuclear weapons from Pakistan. There is also a newly emerging alliance among Saudi Arabia, Israel, Egypt, and Russia. The new alignment will have no particular use for US dollars and no reason to support them." Continue reading →

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The Dialectical Pomposity of the Tapering Promotion

"We might taper, he tells us, if the economy seems strong. We might not if the economy seems less strong. Maybe we will, maybe we won't. And to ascertain the strength of the economy, Bullard and his noobs will parse notoriously unreliable government data. They will make decisions on how much money to print at what price. This is price fixing and price fixing never works. They will use the loony-tune statistics provided to them by the US government. Good luck. They will make determinations about the level of the price fix they shall levy based on these flawed numbers. This is YOUR economy. This is YOUR money." Continue reading →

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Don’t Let the Fed Pick Your Pocket

"If you are one of those who believe that rates will rise when Ben Bernanke leaves office in January, think again. The new Federal Reserve chief, Janet Yellen, has no intention of boosting rates. She will certainly not be a friend to savers. During Yellen’s confirmation hearings on Capitol Hill, she acknowledged that seniors are hurt by low interest rates that are a matter of policy. However, the incoming Fed chief believes the greater good — the health of the U.S. economy — takes precedence over savers. This means that if you’re still relying on CDs and interest-bearing accounts to generate income, you’ll be slaughtered." Continue reading →

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Real Reason for the US’s Global Tax Levy

"This amped-up regulatory regime is not about taxes. It's about control ... not just of Swiss banking facilities but ultimately of banks around the world, large and small. In fact, the top elites already run central banks around the world, so this merely adds another layer of control. And when it comes to running banks, the place where banks supposedly had the most freedom was Switzerland, so that region was attacked first – just to provide an object lesson. The elites do not care how many banks they 'kill' – especially smaller banks that can often prove troublesome. The modern State is more comfortable with a few large and concentrated facilities than myriad small ones." Continue reading →

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China bitcoin arbitrage ends as traders work around capital controls

"The price gap between bitcoins trading in Chinese yuan and those sold for other currencies has evaporated in recent days, highlighting the porous nature of China's capital controls. A key driver of the price gap was China's capital controls, which make it difficult for speculators to swap yuan proceeds from the sale of high-priced Chinese bitcoins into dollars. Analysts say the price convergence also reflects the rapid evolution of the bitcoin market, which began with technology enthusiasts but quickly expanded to include those with the financial know-how to evade China's strict capital controls." Continue reading →

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2013: Year Of The Bitcoin

"Although bitcoin has attracted a lot of attention in the last few months, Babin-Tremblay pointed out that the currency actually started to gain popularity earlier this year as a result of the Cyprus banking crisis. In March the government of Cyprus announced a bail-in for banks, meaning that the financial institutions would have to impose losses on their shareholders, debt holders and even large depositors. After the bail-in was announced people ended up rushing to their bank accounts to withdraw funds. Many put the money into bitcoin, where governments could not touch it. 'Bitcoins were growing slowly until Cyprus. Cyprus was the catalyst for the big increase in the price,' he said." Continue reading →

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Korea decides not to recognize Bitcoin as real currency

"Korean financial authorities said Tuesday that they have decided not to recognize Bitcoin, or cyber currency, as a real legal currency. The conclusion came after a week of debate among officials of the Ministry of Strategy and Finance, the Bank of Korea, the Financial Services Commission and the Financial Supervisory Service. Officials said Bitcoin, which can be traded between individuals online without going through financial institutions such as banks, does not meet standard regulations governing the transactions of currencies via the Internet or commercial institutions. A Bank of Korea official said the currency has been facing high volatility as it does not have an 'intrinsic value.'" Continue reading →

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Talk of the Day — Bitcoin to be introduced in Taiwan

"Wayi International Digital Entertainment Co. announced Wednesday that its online shopping site Wmall will begin to accept Bitcoin payments next year. The OTC (over-the-counter) market-listed company, which focuses on the research, development and distribution of online games, will be the first Taiwanese company to accept the decentralized virtual currency as a payment tool. Wayi's decision will test the Central Bank of the Republic of China's (CBC's) attitude toward Bitcoin development in Taiwan and its ability to regulate the currency's circulation. CBC Governor Perng Fai-nan said recently that the central bank has been keeping close tabs on the development of Bitcoin." Continue reading →

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