money

Robert P. Murphy: The Economics of Bitcoin

"Some critics (who are often proponents of hard money such as gold) object that Bitcoin is in a perpetual 'bubble' because it has no 'intrinsic value.' Yet these critics often seem to overlook just how much the exchange value of gold and silver is (and was) due to their use as media of exchange. Thus, if Bitcoin is currently in a bubble, then, by the same token, gold bullion in the year 1900 (say) was also in a massive bubble because it was trading for a far higher exchange value than could be explained merely by its industrial and ornamental uses." Continue reading →

Continue ReadingRobert P. Murphy: The Economics of Bitcoin

Robert P. Murphy: The Economics of Bitcoin

"Some critics (who are often proponents of hard money such as gold) object that Bitcoin is in a perpetual 'bubble' because it has no 'intrinsic value.' Yet these critics often seem to overlook just how much the exchange value of gold and silver is (and was) due to their use as media of exchange. Thus, if Bitcoin is currently in a bubble, then, by the same token, gold bullion in the year 1900 (say) was also in a massive bubble because it was trading for a far higher exchange value than could be explained merely by its industrial and ornamental uses." Continue reading →

Continue ReadingRobert P. Murphy: The Economics of Bitcoin

Robert P. Murphy: The Economics of Bitcoin

"Some critics (who are often proponents of hard money such as gold) object that Bitcoin is in a perpetual 'bubble' because it has no 'intrinsic value.' Yet these critics often seem to overlook just how much the exchange value of gold and silver is (and was) due to their use as media of exchange. Thus, if Bitcoin is currently in a bubble, then, by the same token, gold bullion in the year 1900 (say) was also in a massive bubble because it was trading for a far higher exchange value than could be explained merely by its industrial and ornamental uses." Continue reading →

Continue ReadingRobert P. Murphy: The Economics of Bitcoin

Robert P. Murphy: The Economics of Bitcoin

"Some critics (who are often proponents of hard money such as gold) object that Bitcoin is in a perpetual 'bubble' because it has no 'intrinsic value.' Yet these critics often seem to overlook just how much the exchange value of gold and silver is (and was) due to their use as media of exchange. Thus, if Bitcoin is currently in a bubble, then, by the same token, gold bullion in the year 1900 (say) was also in a massive bubble because it was trading for a far higher exchange value than could be explained merely by its industrial and ornamental uses." Continue reading →

Continue ReadingRobert P. Murphy: The Economics of Bitcoin

Everything Created Digitally Is Nearly Free–Including Money

"The key feature of digitally creating credit/money is this: it is immeasurably easier to digitally create claims on real-world assets than it is to create real-world assets. This is why the digital creation of trillions of dollars in credit/money is distorting and disrupting the real economy of real-world assets: the claims on those assets keep expanding while the actual assets remain stubbornly tied to the real world. This widening disconnect between rapidly multiplying digitally created claims on real assets and the actual assets has spawned a multitude of pernicious consequences." Continue reading →

Continue ReadingEverything Created Digitally Is Nearly Free–Including Money

Here’s a New Way to Bet on China: Open a Renminbi Bank Account [2011]

"China's economy is booming, and in the West, everyone from President Obama on down is demanding that the Chinese currency be allowed to rise in value. Now, it's possible for small investors in the U.S. to capitalize on this opportunity. The Bank of China's New York Branch announced this week that Americans will now be able to open FDIC-guaranteed accounts in the bank in a way that was never before permitted -- by converting their deposits into the Chinese currency, known officially as the renminbi and colloquially as the yuan. According to the bank's website, account owners can exchange as much as $4,000 worth of renminbi a day, up to a maximum of $20,000 a year." Continue reading →

Continue ReadingHere’s a New Way to Bet on China: Open a Renminbi Bank Account [2011]

Argentina’s grand plan to recover US dollars is about as worthless as its own currency

"For three months, anyone sitting on a pile of undeclared dollars will be able to contribute to Argentina’s already astronomical debt by depositing them at the central bank in exchange for a 4% annual return through 2017. But why would anyone buy Argentine bonds right now with American dollars? People aren’t sitting on dollars in Argentina because they make comfortable cushions; they’re hoarding them because it’s the safest investment in Argentina right now. Argentines are now willing to pay more than twice the open market exchange rate. The country’s crippling default in 2001 and the ensuing flash devaluation of the Argentine peso are fresh on everyone’s mind." Continue reading →

Continue ReadingArgentina’s grand plan to recover US dollars is about as worthless as its own currency

Argentina: Give Us Your Real Dollars for Our Fake Dollars

"President Cristina Fernandez de Kirchner’s wish of being able to print dollars is coming true as the central bank begins issuing dollar-denominated certificates today that trade in pesos. Argentina is issuing the certificates, known as Cedines, as part of a tax amnesty plan to attract undeclared cash back into the economy. The Cedin 'is an ideal medium for the payment of U.S. dollar obligations,' and can be used for buying products from house appliances to construction materials, according to the law approved by congress May 29, Argentines with undeclared foreign-currency savings have until Sept. 30 to trade their dollars for a certificate of deposit for investment, or Cedin." Continue reading →

Continue ReadingArgentina: Give Us Your Real Dollars for Our Fake Dollars

Bitcoin Trade Group Bites Back at California

"The Bitcoin Foundation is defending the virtual currency to California’s banking department, explaining bitcoin doesn’t qualify as a payment instrument under the state’s money-transmission rules. In a lengthy letter addressed to Tara Murphy, an assistant attorney general in the California Department of Financial Institutions, the Washington-based group also stuck up for itself, saying it doesn’t sell or exchange the virtual currency. California is known to be particularly aggressive in enforcing money-transmission rules. In the letter, the foundation made it clear that it doesn’t even operate in California." Continue reading →

Continue ReadingBitcoin Trade Group Bites Back at California

How You Can Quickly Make It into the World’s 1% Richest

"You might already be there. If not, get a job at McDonald's and work overtime. It only takes $34,000 a year, after taxes, to be among the richest 1% in the world, according to World Bank economist Branko Milanovic in his book The Haves and the Have-Nots. CNN reports on Milanovic data: 'The true global middle class, falls far short of owning a home, having a car in a driveway, saving for retirement and sending their kids to college. In fact, people at the world's true middle -- as defined by median income -- live on just $1,225 a year. (And, yes, Milanovic's numbers are adjusted to account for different costs of living across the globe.)'" Continue reading →

Continue ReadingHow You Can Quickly Make It into the World’s 1% Richest