Come for the politics, stay for the snark.

It’s a doggy dog world.

Is it irresponsible to speculate? It is irresponsible not to.

Let’s delete this post and never speak of this again.

GOP baffled that ‘we don’t care if you die’ is not a winning slogan.

Pessimism assures that nothing of any importance will change.

Fight for a just cause, love your fellow man, live a good life.

Just because you believe it, that doesn’t make it true.

One of our two political parties is a cult whose leader admires Vladimir Putin.

I am pretty sure Katy Tur wasn’t always such a bootlicking sycophant.

Can we lighten up on the doomsday scenarios?

A thin legal pretext to veneer over their personal religious and political desires.

It’s all just conspiracy shit beamed down from the mothership.

I like you, you’re my kind of trouble.

And we’re all out of bubblegum.

Battle won, war still ongoing.

There’s always a light at the end of the frog.

Dead end MAGA boomers crying about Talyor Swift being a Dem is my kind of music. Turn it up.

The US Supreme Court is on the ballot in november.

“Why isn’t this Snickers bar only a nickel?”

They were going to turn on one another at some point. It was inevitable.

Conservatism: there are people the law protects but does not bind and others who the law binds but does not protect.

The choice is between normal and crazy.

Trump makes a mockery of the legal system and cowardly judges just sit back and let him.

Republicans seem to think life begins at the candlelight dinner the night before.

You are here: Home / Politics / Domestic Politics / When It All Falls Down

When It All Falls Down

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People are weird:

Bitcoin is in the “mania” phase, with some people even borrowing money to get in on the action, securities regulator Joseph Borg told CNBC on Monday.

“We’ve seen mortgages being taken out to buy bitcoin. … People do credit cards, equity lines,” said Borg, president of the North American Securities Administrators Association, a voluntary organization devoted to investor protection. Borg is also director of the Alabama Securities Commission.

“This is not something a guy who’s making $100,000 a year, who’s got a mortgage and two kids in college ought to be invested in.”

Bitcoin has been soaring all year, starting out at $1,000 and rocketing above $19,000 on the Coinbase exchange last week. The price on Coinbase, which accounts for a third of bitcoin trading value, is often at a premium over other exchanges.

The cryptocurrency was trading at just under $16,700 on Coinbase at 2:21 p.m. New York time Monday.

I kinda feel like people buying bitcoin right now are the folks who headed to the Gold Rush in California in 1856. Just a couple years late, guys. But who knows!

At any rate, if there is a bitcoin crash, what impact could it have on the economy?

Reader Interactions

220Comments

  1. 1.

    scav

    certainly a lot of whining and “analysis” — bit of a boomlet for the media and professional-opinion class.

  2. 2.

    Major Major Major Major

    At any rate, if there is a bitcoin crash, what impact could it have on the economy?

    If it’s tomorrow, hardly any. I don’t think the investment bankers have had time to take out trillions in tertiary derivatives on bitcoin mortgages yet.

  4. 4.

    Sister Machine Gun of Quiet Harmony

    Some individuals will get screwed. Lots of black market folks will get hurt. Dude bros will cry.

  7. 7.

    ? ?? Goku (aka The Hope of the Universe) ? ?

    Until a few days ago, I hadn’t heard about bitcoin in like 3 years. I thought it died.

  10. 10.

    Yarrow

    Maybe the Trump organization and Trump family members are over-invested in bitcoin. That would make any crash more entertaining.

  13. 13.

    TenguPhule

    At any rate, if there is a bitcoin crash, what impact could it have on the economy?

    Depends on how many fools and how much actual money went into it.

  15. 15.

    Droppy

    At any rate, if there is a bitcoin crash, what impact could it have on the economy?

    Not an economist, but pretty sure no wealthy people, Republican legislators, or bankers will be impacted, except they will probably sweep up the meager leavings of the poor and downtrodden and claim the whole thing was Obama’s/Clinton’s fault.

  17. 17.

    MikeEss

    …I can hardly wait until somebody (Goldman Sachs?) is selling the Bitcoin equivalent of the notorious “collateralized debt obligations” and their evil handmaidens, “derivatives”.

    I’ve seen that movie before…what a wild ride. And you pay to take that ride, but you also pay for other richer riders to take that ride too. And in the end I’m poorer, but they’re richer…and they’re looking for the next opportunity to screw us all into the ground…

    Fun times…

  18. 18.

    Dmbeaster

    The speculation is in the “next greater fool” phase in which people invest because they expect to be able to sell profitably to those who jump into the speculative bubble later, even though the bubble is already dangerously inflated, and no one is investing based on a rational analysis.

  19. 19.

    TenguPhule

    @MikeEss:

    I can hardly wait until somebody (Goldman Sachs?) is selling the Bitcoin equivalent of the notorious “collateralized debt obligations” and their evil handmaidens, “derivatives”.

    Too late. Rollout starts next week, IIRC.

  21. 21.

    Major Major Major Major

    @MikeEss: Derivatives are very common in commodities markets. What made the mortgage-backed securities such a problem was, in addition to the insane leverage, the fact that they were based on shitty mortgages on houses with fake prices.

    There are already insurance-like derivatives for bitcoin, like there are for corn.

  22. 22.

    cthulhu

    At any rate, if there is a bitcoin crash, what impact could it have on the economy?

    Not much. The same effect as a single, not commonly trading stock crashing. It was noted the other day that about 1000 people own 40% of the Bitcoins.

  23. 23.

    Hoodie

    The chance of a complete meltdown will likely remain so so until other digital currencies (e.g., ether) are more widely used and more easily fungible with dollars. Ether will likely expand quckly because of use in startup crowdfunding. From what I’ve been told, because of the relatively small ether market, people are using bitcoin as an intermediary currency to cash in on these deals to get operating capital (or buy Ferraris). If you sell too much ether for dollars at one time, the market could crash.

  24. 24.

    Amir Khalid

    About a couple of months ago, I started seeing clickbait-section articles (y’know, the ones listed as “partner content” by more reputable sites that take the clickbait “content” providers’ money) bigging up Bitcoin and saying how it was growing more popular with Malaysian investors. Let me just say, I had my suspicions.

  25. 25.

    Bruce K

    I strongly suspect it’s going to be like a remake of the end of Trading Places, only without Ralph Bellamy or Don Ameche to class up the joint. If something goes wrong with Dunning-Krugerrand speculation, it’s going to go wrong big.

    Did I say “if”? More likely “when”.

  26. 26.

    Tenar Arha

    If bitcoin is like the California gold rush, who’re the hoteliers, hostlers, & general suppliers? Who’s the Levi Strauss?

    ? Perhaps the server farms, computer suppliers, & electricity providers….

  27. 27.

    catclub

    @Major Major Major Major:

    There are already insurance-like derivatives for bitcoin

    @MikeEss:

    I am not so sure derivatives will be a problem. How many derivative products are there based on gold? I am guessing close to zero, because there is no income stream to be divided up in funny ways. The mortgage derivatives have that income stream property. Bitcoins don’t.

  28. 28.

    Johnny Gentle (famous crooner)

    FYI, the boom happened because Japan recognized bitcoin as an official currency earlier this year.

    While it obviously had its uses online before then (Silk Road, here we come!), its acceptance by a pre-eminent national economy turned it into something else entirely.

  29. 29.

    jl

    @Tenar Arha: I agree. So far, not enough of real economy driven by bitcoin mania for crash to affect demand or supply of real goods and services much. Bitcoin not some hidden network of vast connections that would create financial instability. A bunch of foolish people who took out mortgages to buy bitcoin would lose their houses and other people would move in.

    Very different from 2001 dot.com bust and very very different from 2007 housing bust and financial crash.

  33. 33.

    scav

    @Major Major Major Major: Since when does actual importance correlate with volume of whining and analysis? White males will get weepy over their non-NRA-approved metric of dick-length — near a gaggle of jounalists hungry for a non-Trump / non-pedophile-harrassment shiney pet-rock of a topic.

  35. 35.

    catclub

    @Chip Daniels: The standard exit plan for bitcoin holders is: ” having your bitcoins stolen”
    There was a funny article describing how bitcoin does none of the things it was supposed to do. bitcoin-is-none-of-the-things-it-was-supposed-to-be

    not currency, not store of value, not disintermediator of the finance industry.

  37. 37.

    Roger Moore

    @diierent-church-lady:

    I like how he talks about 100k as though it were substanance income.

    I don’t think he intends to describe it as subsistence income. He’s saying that Bitcoin is a gamble, and people who can’t afford to lose everything shouldn’t be getting involved– and he’s absolutely correct.

  39. 39.

    HeleninEire

    Not asking anyone to respond or answer this, cuz I really don’t give a shit (unless it affects my retirement money that I have in the market, you know, that money that I scrimped and saved for 35 years. Then I give a shit). But, I’m pretty smart and I do not have a fucking clue what bitcoin is. I don’t understand it at all. Even after reading Anne Laurie’s post from yesterday.

  41. 41.

    Matt McIrvin

    @HeleninEire: It’s like a virtual form of Beanie Babies, only invented and promoted by libertarian tech bros with goldbug-like economic obsessions. That’s pretty much all you need to know.

  43. 43.

    geg6

    I’ve tried to figure out what the point of bitcoin is, but all I can come up with is buying illegal shit and to fleece the rubes stupid enough to invest in it. As we all seemed to agree yesterday, bitcoin is the tulips of the current era. You’d have to be an idiot to invest in it.

    And just because Japan is stupid doesn’t mean we have to be.

  46. 46.

    scav

    @Major Major Major Major: The gullable ill-informed chatterers are exactly the juicy bulk of the jounalists audience — an American audience mind, so adjust expectations lower. We’re already hearing far far more about this topic than it merits. So, economic impact: a few extra clicks for media accomplished.

  47. 47.

    Roger Moore

    @Tenar Arha:

    If bitcoin is like the California gold rush, who’re the hoteliers, hostlers, & general suppliers? Who’s the Levi Strauss?

    ? Perhaps the server farms, computer suppliers, & electricity providers….

    FWIW, Bitcoin has long since moved away from using general purpose computers. The first phase was to use graphics cards instead of regular CPUs, since they’re better at the kind of processing used for Bitcoin mining. The next stage was to switch to ASICs (application specific ICs), i.e. custom designed chips intended only for Bitcoin mining. And yes, the companies providing that kind of custom hardware are definitely the equivalent of the Gold Rush suppliers. In the same category are people running Bitcoin exchanges and similar ancillary stuff, who make money on every transaction.

  48. 48.

    Major Major Major Major

    @Thoroughly Pizzled: AWS doesn’t have anything to do with it, unless they happen to provide the backbone infrastructure for Coinbase and the other big exchanges. All the mining (and therefore the bulk of the work) is done by specialized computers sitting in places with cheap electricity like Iceland, calculating expensive cryptographic hashes. The Internet itself is a minor, though essential, component as a percent of computation.

  49. 49.

    TenguPhule

    “Meet the Lawyers trying to Protect Trump from Mueller’s Killers”

    FFS, Wapo, you’re supposed to be better then this.

    They really are ginning up to try and do something stupid and illegal against Mueller and the investigation.

  50. 50.

    TenguPhule

    Lawmakers are on the verge of striking a tentative agreement that would reconcile tax bills passed separately by the House and Senate, and an announcement could come later Tuesday or sometime Wednesday, a top Senate Republican said Tuesday.

    Republican Sen. John Thune (R-S.D.), the No. 3 Senate Republican, said in an interview that negotiators are reviewing a proposal they received late Monday from House leaders. But he said there is still “swirl” around key details — including the corporate tax rate.

    Lock your phones in attack position. This is it.

  52. 52.

    justawriter

    @Tenar Arha: … the guys charging five bucks to process a bitcoin transaction (about 15 times what a bank charges for processing a check or credit card transaction). Which is funny because bitcoin was supposed to remove those intermediaries from the libertarian paradise of government-free money.

  53. 53.

    Roger Moore

    @geg6:

    I’ve tried to figure out what the point of bitcoin is, but all I can come up with is buying illegal shit and to fleece the rubes stupid enough to invest in it.

    You left out money laundering and evading capital controls. Those are why it’s supposed to be a big deal in Russia and China.

  54. 54.

    Roger Moore

    @Major Major Major Major:

    All the mining (and therefore the bulk of the work) is done by specialized computers sitting in places with cheap electricity like Iceland, calculating expensive cryptographic hashes.

    All the serious mining is. You’ll hear about small-time players doing shit like putting a mining rig in a Tesla so they can get “free” power from their superchargers or writing mining clients in JavaScript so they can surreptitiously run them on other people’s computers when they visit a web page.

  55. 55.

    TenguPhule

    @Major Major Major Major:

    Is that going to be enough time to type everything up and run it through spell check and not accidentally increase the corporate tax rate again?

    They don’t seem to care at this point. They really want this done before Christmas and seem to think any issues can be fixed later. Its crazy, but they’re not letting that simple fact stop them.

  57. 57.

    VeniceRiley

    I have a friend who had a live internet game show giving bitcoin away back when it was $300. Not enough views back then.

  58. 58.

    Jack the Second

    So here is the thing that will make Bitcoin weirder than previous scams.

    It is a distributed, decentralized scam.

    This bubble too will pop, but why would that make a difference? The same or a completely different set of hucksters could just start reinflating it, the next day or month without missing a beat. There’s no single group of fraudsters to be shut down, no company to go bankrupt, nothing at the core but promises of free money.

    I don’t see how Bitcoin succeeds, as a useful, legitimate currency, but I also don’t see how it fails so hard we’re ever rid of it.

  59. 59.

    Matt McIrvin

    @justawriter: I think going to paid transactions was always the model, because beyond some point you can’t motivate running the miners to actually create new bitcoin.

    Unfortunately that depends on a healthy rate of transactions, and the deflationary nature of the “currency” is a powerful force to keep it from circulating.

  60. 60.

    Matt McIrvin

    @Jack the Second: That’s how chain letters and pyramid schemes have always worked–you keep getting new “distributors” in who are motivated to evangelize the system to expand their downline. They’re hard to eradicate even after a lot of people have been cleaned out, because new fools do pop up eventually even after the scheme has collapsed from a lack of a sufficient volume of fools.

  62. 62.

    Jack the Second

    @TenguPhule:

    They really want this done before Christmas^H^H^H^H^H^H^H^H Mueller indicts Trump, Pence and half a dozen senior Congressmen.

    FTFY.

  63. 63.

    Tenar Arha

    @Roger Moore: @justawriter:

    Ooohhhh, that’s good for a chuckle.

    So basically the service economy to support “the miners,” the people who’ve figured out how to get a cut via “processing the gold or testing it’s purity or smelting it,” & the suppliers of equipment to “dig the gold.”

  64. 64.

    Fair Economist

    @Chip Daniels:

    And who will be the card sharps and bordellos and hustlers who fleece the hoopleheads?

    There’s been a good deal of that already. Mt. Gox, the Magic trading card site which became the broker for most bitcoin trading at one point, was hacked and nearly a million bitcoins stolen (almost a tenth of the supply at the time).

    I know it sounds like a plot from a novel parodying libertarian/dudebro culture, but it really happened and I am not making that up.

  65. 65.

    Roger Moore

    @Matt McIrvin:

    Unfortunately that depends on a healthy rate of transactions, and the deflationary nature of the “currency” is a powerful force to keep it from circulating.

    Not to mention that the system by design can’t handle more than about 7 transactions per second. They need to change the block size if they want to handle more, and they’ve been very reluctant to do that. They’re apparently planning on coming up with some kind of secondary market to handle more. IOW, their system was never well thought out as a serious financial system, and they’re trying to hold it together with bubble gum and bailing wire.

  67. 67.

    TenguPhule

    @Roger Moore:

    and they’re trying to hold it together with bubble gum and bailing wire.

    Which is doomed to fail because everyone knows you’re supposed to use duct tape.

  68. 68.

    The Dangerman

    @Yarrow:

    Maybe the Trump organization and Trump family members are over-invested in bitcoin. That would make any crash more entertaining.

    Indeed. I’d give my left one (maybe both of them) to see the Trump spawn mowing lawns to pay the bills (assuming they don’t go to the Pokey).

    Speaking of Trump, he’s just a full on bully and someone’s going to have to punch back hard. I mean, really hard. Gillebrand should have called into question his manhood this morning when she was called a whore.

  69. 69.

    Major Major Major Major

    @Fair Economist: For all the love Ethereum has been getting recently, everybody seems to have forgotten the incident last year where a shadowy entity, possibly its creator, ran off with 10% of it, and the community split in two over whether or not to restore the funds, resulting in a hard fork of the currency. Or the $300 million stolen so far this year.

  70. 70.

    TenguPhule

    And doesn’t this sound familiar.

    House Republicans are pressing on with a sweeping overhaul of a federal law that governs almost every aspect of higher education, without hearings and despite mounting pressure to give stakeholders more time for analysis and input.

    On Tuesday, the House Committee on Education and the Workforce will debate and consider amendments to the Promoting Real Opportunity, Success, and Prosperity through Education Reform Act, introduced by chair Rep. Virginia Foxx (R-N.C.) and Rep. Brett Guthrie (R-Ky.). The “markup” is expected to take two days as Democrats and Republicans plan to introduce nearly 60 amendments, according to congressional staffers.

    The legislation is the first significant step in the reauthorization of the Higher Education Act of 1965, which has remained largely untouched for nearly a decade. As a result, university, student and consumer groups are pleading with the committee to slow down. Barely two weeks have passed since Foxx released the 542-page bill, a tome that would change everything from the way families finance education to the way colleges are held accountable for their performance.

    On the eve of the markup, Republicans tucked in more provisions allowing the education secretary to cut off federal grant to students with “unusual enrollment history” and bar campuses from regulating fraternities and sororities, among other provisions.

    We are being buried in bullshit.

  71. 71.

    beef

    If bitcoin goes to zero tomorrow, the global economy will burp and continue on its merry way.

    Total number of bitcoins ~ 20 million. Current value of 1 bitcoin ~ $20000. Total value of all bitcoins: ~$400 billion.

    That’s a big number for you or I, but the relevant scale is global GDP, which is roughly $100,000 billion / year. Bitcoin’s not used for anything systemically important. It’s not even very well connected to the rest of the economy.

  72. 72.

    catclub

    @Jack the Second:

    but I also don’t see how it fails so hard we’re ever rid of it.

    I will just point out that Ethereum and another cryptocurrency are up today. The obvious lesson (now) with bitcoin is that you have to get in early, so all the new coins are getting those people who believe that. Never mind that you have to get in early on the ONE coin that ends up succeeding (if any ever do.)

  73. 73.

    Roger Moore

    @Tenar Arha:
    Essentially correct. The people who make money on a gold rush are the ones who can demand payment up front rather than depending on chance.

  74. 74.

    ET

    I get the impression that banks may not be moving into Bitcoin soon – at least if Jaime Diamon’s opinion is anything to go by (though JP Morgan may regardless and Goldman’s CEO is more sympatic). Buffet isn’t a fan.

    I find the discussion generally interesting if for no other reason than the related stories that come out. It seems China is a BIG player in the power behind bitcoin and its role/interest. Beyond that I have no idea what happens when/if it blows and most likely don’t know either.

  77. 77.

    catclub

    @beef:

    Current value of 1 bitcoin ~ $20000. Total value of all bitcoins: ~$400 billion.

    I agree on the first point for 1 bitcoin. Not so much if everyone tried to cash out. It is kind of like when one 100 share stock sale raises the market price by
    $1 and then the ‘value’ of the company goes up by $20M. That $20M was not really put there.

  78. 78.

    What Have The Romans Ever Done for Us?

    There was a huge speculative bubble and crash in 1637, in the Netherlands, involving tulip bulbs. People gonna speculate. Always ends the same way though – last guy out loses his shirt.

  81. 81.

    Matt McIrvin

    @Roger Moore: I’m pretty sure that was because it was concocted by people with crackpot economic theories.

    My understanding is that there’s nothing about the blockchain tech that inherently requires it to be absurdly deflationary or quite so energetically expensive, and many other cryptocurrencies aren’t this way. But Bitcoin is the one that’s attracted the most interest.

  82. 82.

    beef

    @catclub:

    The $400 billion is an estimate of how much “wealth” would vanish if the value of bitcoin went to zero tomorrow. It’s a reasonable upper bound, given current data. The critical point for the estimate is actually the lede I buried: Bitcoin’s not much correlated to the rest of the economy. If it vanished, I doubt it would drive a crash in anything else.

  83. 83.

    Fair Economist

    @Major Major Major Major: The fact that something like Ethereum still exists after multiple successful thefts of that magnitude shows the religious devotion of adopters. No real currency subject to that would get used unless the issuing government could compel it.

  84. 84.

    Peale

    @beef: Yep. I the big banks are blockchain curious, but none of them are involved in a big enough way to pose a systematic risk like mortgages caused in 2008. We may find some hedge funds go under, but the deritives trading exposure of the market is in the tens of billions, which can be absorbed. We may find some global oddities – maybe some bank in someplace like Cyprus or Malta goes poof, but nothing huge.

  85. 85.

    Fair Economist

    @Matt McIrvin:

    My understanding is that there’s nothing about the blockchain tech that inherently requires it to be absurdly deflationary or quite so energetically expensive, and many other cryptocurrencies aren’t this way.

    If you’re using it for a currency, I don’t see how things can be different in the long term. If it’s not deflationary, there’s no reason to “invest” in it and so it will never get going. If it’s deflationary, eventually the cost of creating must become astronomical.

  86. 86.

    catclub

    @beef:

    The $400 billion is an estimate of how much “wealth” would vanish if the value of bitcoin went to zero tomorrow.

    alternatively, you could calculate how many dollars have gone in so far, that would be lost in that case. Given that most bitcoins came into existence when the price was far lower, the total invested is much smaller than $400B

  89. 89.

    NotMax

    @TenguPhule

    In much younger days, hefting bales off the delivery truck and thence stacking them from floor to eaves until a stable’s hayloft was full provided a hands-on relationship with baling wire.

  91. 91.

    Peej

    I have Bitcoin, but not for investing/speculating/hoarding purposes. It’s the most convenient way to fund my online wagering account as well as cashing out from it. FWIW, last Monday, I got a payout for the equivalent of 900.00 USD and it’s been amusing to see it go up to 1,200.00 USD, but I know it’ll eventually come crashing down. The question may be when will I convert it to actual USD? My Bitcoin wallet has a feature where you can fund a prepaid Visa card. Once it’s on the card, it’s actual “cash”, and no longer subject to the vagaries of the market. In fact, I just funded it for 250.00 USD. The remaining 950.00 USD equivalent in my Bitcoin wallet will continue adjusting to the market. What if I lose it all tomorrow? Meh, I’m a degenerate basketball and football gambler, it happens. Hey, how ’bout them Dolphins winning on the +450 Money Line last night!

  94. 94.

    Major Major Major Major

    @Matt McIrvin:

    My understanding is that there’s nothing about the blockchain tech that inherently requires it to be absurdly deflationary or quite so energetically expensive, and many other cryptocurrencies aren’t this way.

    Nothing about blockchains requires them to be used for cryptocurrencies or other monetary transactions at all, even.

  95. 95.

    ? Martin

    @Matt McIrvin: Blockchain is a pretty straightforward technology for distributed ledgers. It has no necessary connection to currency, it’s just a handy tool for leaving ledges out in the open. A different application of blockchain could be college credentialing, where everyone’s degree and institution is publicly reported but because of how the blockchain works, impossible to alter. If you wanted to confirm that so and so graduated with the degree they claim, you could check any public ledger.

  96. 96.

    Major Major Major Major

    @Fair Economist: It’s best to think of these things as commodities, in which case the popularity even after $300m of theft makes more sense. What doesn’t make sense is holding on to Ether after last year’s incident, which was super sketchy.

    If you think of it as a brown paper bag full of gold, this year’s thefts are the equivalent of train heists or muggings. Last year’s theft would be more like if a cabal of gold miners decided to steal 10% of the world’s gold. That’s what should diminish your faith in gold, not the train robberies.

  99. 99.

    gvg

    @catclub: Some of the descriptions of Bitcoin say the original miner of each coin keeps getting a small share each time it’s traded. I don’t understand how that would work but I would think that would be an income stream that would attract the derivative inventors. Shame really.

    I happen to think some of the attention on bitcoins lately is a bunch of us waiting to watch the crash of a type of person we don’t care for, the libertarian tech fools.It’s not like a lot of these stories aren’t also warnings. some lemmings insist on going over a cliff.

    One of the things Bitcoin was supposed to do was not be stolen AND be anonymous. I think that is basically impossible in definition.

  100. 100.

    Roger Moore

    @beef:

    The $400 billion is an estimate of how much “wealth” would vanish if the value of bitcoin went to zero tomorrow.

    And that’s almost certainly a gross overestimate. Almost all of that wealth has been created out of thin air in the past couple of months, so it’s hard to imagine that it going back into thin air is going to do a lot of damage.

  102. 102.

    David ??Merry Christmas?? Koch

    Looks like I picked the wrong week to stop trading put options on default swaps on indexed derivative futures.

  110. 110.

    beef

    @catclub @RogerMoore:

    Yes, obviously. This is why I said upper bound. But the loose upper bound is quantitative and leaves me feeling pretty safe, so I’m not going to waste time trying to figure out how much has actually been spent. (Anyone know the going rate for electricity in northern China over the last few years? Or the cost of manufacture for ASICs?)

  111. 111.

    Matt McIrvin

    @gvg: I’d completely ignore it except that the energy consumption involved is starting to be a significant contributor to global carbon footprint.

  112. 112.

    Matt McIrvin

    @Fair Economist: Isn’t that true of any attempt to create a new currency, regardless of technology? If your strategy involves convincing people to hoard it because it will appreciate in value, then it won’t work as a currency; it’s just some sort of investment instrument.

  117. 117.

    Roger Moore

    @Major Major Major Major:

    If you think of it as a brown paper bag full of gold, this year’s thefts are the equivalent of train heists or muggings. Last year’s theft would be more like if a cabal of gold miners decided to steal 10% of the world’s gold. That’s what should diminish your faith in gold, not the train robberies.

    I’m not sure I agree. Yes, it’s true that a cabal stealing is a bigger concern than random muggings, but those muggings are still worth paying attention to. There’s a reason people have switched over time from handling large transactions in cash to checks to various forms of electronic payment, and protection from theft is a major factor. It’s not obvious that the reduced transaction costs from something like Etherium is worth it when you consider the increased risk of on-line theft.

  125. 125.

    Doug R

    @Tenar Arha:

    If bitcoin is like the California gold rush, who’re the hoteliers, hostlers, & general suppliers? Who’s the Levi Strauss?

    This makes me think some trumps are into bitcoin. Grandpappy drumpf ran a few whorehouses during the Alaska Gold Rush in the PNW before he was kicked out of Germany permanently.

  126. 126.

    rikyrah

    1.Just spoke with a source in the Mobile (AL) County NAACP. Here are some things that are happening today on the ground in Alabama that did not happen in the 2016 election. Thread:

    — Al Giordano (@AlGiordano) December 12, 2017

  127. 127.

    rikyrah

    Uh huh
    Uh huh

    CNN’s Jim Acosts says @PressSec pulled him aside to warn him against asking Trump about his sleazebag attack on Gillibrand or he won’t be allowed back.

    — JoeMyGod (@JoeMyGod) December 12, 2017

  128. 128.

    J R in WV

    @Roger Moore:

    And no one knows who designed the bitcoin systems, and few really understand why it is built the way it is. Various people have been accused of inventing bitcoin, all deny any connection with it.

    Someone not quite as smart as they think they are!

  129. 129.

    Doug!

    Zero effect if it crashes. Total market cap of 9 billion in a 17 trillion dollar economy. Apple comes up and down as much in a typical week as the total market cap of bitcoin.

  133. 133.

    different-church-lady

    @geg6:

    I’ve tried to figure out what the point of bitcoin is, but all I can come up with is buying illegal shit and to fleece the rubes stupid enough to invest in it.

    Ah, so you’ve figured it out.

  134. 134.

    trollhattan

    @rikyrah:
    From my vast list of Things That Will Never Happen–the rest of the press pool should double-down and keep asking about it. They’re all (except for Fox et al) suffering from Stockholm Syndrome after a year of this crap.

  138. 138.

    JR

    At any rate, if there is a bitcoin crash, what impact could it have on the economy?

    The Chinese economy? Maybe a little.

  142. 142.

    J R in WV

    @Major Major Major Major:

    I am obviously not as smart as I think I am!!

    Will they still have that much money if the exchange rate value of BitCoin goes to its actual value of $1.49?? If it was me, I’d be moving a fixed rate of that pool into actual equity investments on a daily basis, but I’m a conservative socialist type! ;-)

    As opposed to the libertarians out there!

  144. 144.

    woodrowfan

    I confess I am Bitcoin curious. Fortunately I have no money to spend on it or I would. Not a lot. $1,000 maybe

  145. 145.

    WaterGirl

    @rikyrah: i wish one of these guys would grow a spine. Ask your question and say out loud that you were threatened with not being allowed back if you asked it. They have their own power if they would just use it for good.

  150. 150.

    marcopolo

    @rikyrah: No idea what the final result in AL will be today, but I wouldn’t be surprised if overall turnout today wound up being close to the Presidential vote total in 2016 (could it be higher–maybe). Obviously there were a lot of up and down the ballot races in 2016. That plus the presidential contest increases turnout but in a place like AL are there ever all that many competitive races between Ds & Rs when all is said and done? I’d wager not. Today’s election, on the other hand, is a very competitive state-wide race with at least the level of coverage that I imagine the presidential contest got in the state in 2016. Plus lots of motivated voters. And while I’d like to believe that Jones voters are the more motivated. I don’t think we should underestimate the rural Trump/Moore folks who’d like nothing better than giving the finger to the “establishment.” I definitely think the AL Sec of State’s prediction of 25% turnout will be way way too low. All that being said: GO JONES!

  151. 151.

    Chip Daniels

    @catclub:

    bitcoin-is-none-of-the-things-it-was-supposed-to-be

    *meme of Morpheus*
    What if I told you…
    That separating the hoopleheads from their money WAS what Bitcoin was meant to be?

  152. 152.

    rikyrah

    I know I’m a broken record, but *we need to focus on voter suppression and election interference*. Both domestic and foreign threats are a problem.

    If you don’t tackle these issues now, you likely won’t get another chance later.

    — Sarah Kendzior (@sarahkendzior) December 12, 2017

  154. 154.

    NotMax

    Mocking fodder.

    Former Alabama state judge Roy Moore arrived at his polling station, the Gallant Fire Department, just after 11:30 a.m. eastern time Tuesday.

    He showed up on horseback, riding his horse named “Sassy.” Source

    While former is technically correct, twice ousted would be more accurate.

  155. 155.

    Redshift

    Seeing reports of police at polling places “looking for people with outstanding warrants.” Quelle surprise. Also the old “text messages telling people their polling place has changed.”

    Not that it will help with this election, but I suspect that with the record donations to the ACLU, quite a few police departments may be contributing to the “full employment for lawyers fund” in the coming months…

  156. 156.

    trollhattan

    @WaterGirl:
    Can you just imagine prostrating yourself before Possum Queen daily, simultaneously praying and dreading she’ll take your question? They all act like shelter dogs.

  164. 164.

    WaterGirl

    i watched the 4-minute Doug Jones video earlier this week, but i had not listened to his full speech on Dec 5 until just now. If you haven’t watched/listened to that, you should. It’s worth the time.

  165. 165.

    tobie

    @rikyrah: Fighting voter suppression has to be a number one priority for the party. I hope they’re going to sponsor internships in all swing states over the summer–heck in all 50 states!–to help voters get the documentation necessary to register to vote. Great way, too, to get young people involved in the party.

  169. 169.

    WaterGirl

    @trollhattan: Why do you hate shelter dogs? Seriously, though, these white house reporters and many more have completely lost the plot. I don’t care what the story of the day is, they could make the real story be about the intimidation at the hands of the press secretary.

    If being in the room is more important than the information it gives you access to, you’ve lost the plot. If getting invited to the right parties is more important to your journalistic integrity, you’ve lost the plot. These people have no shame – the reporters that care most about their access – as well as the power-wielding people who lie and threaten to protect their status.

  172. 172.

    trollhattan

    @WaterGirl:
    My most charitable view of NYT keeping Haberman on the job is that she represents the closest access they’re ever getting to this president. How sad is that?

  176. 176.

    ruemara

    @rikyrah: We have only this election and that’s it. My heart tells me this and in the past 15 years, when I have that feeling, I’ve been correct. We lose and we lose big for at least another decade or 2. Think about it.

  179. 179.

    germy

    Donald Trump Gets Own Birthday Wrong on Absentee Ballot

    Sometime on October 19, presumably in between chugging Diet Cokes, President Donald Trump signed an absentee ballot for the New York City mayoral election. We don’t know who he voted for, but we do know that he got one very crucial thing wrong: his dang birthday.

    The New York Daily News reports that, upon reviewing his ballot application, they found he listed his birthday as July 14, 1946. He was in fact born on June 14, because of course he’s a Gemini.

    Meanwhile, Melania Trump reportedly didn’t sign her ballot envelope, Ivanka didn’t mail hers until Election Day, and Jared Kushner didn’t bother mailing his in at all.

    Incompetent grifters aren’t good with details.

  185. 185.

    ruemara

    @WaterGirl: anything between 2016 up to 2018. By the 2018 election and immediately after, of the republicans retain majorities in Congress and in state legislatures and if they can get state governorships, I fully expect constitutional convention to be called and I expect the full evil of the Supreme Court being in their hands to bear fruit. You guys will literally be waiting for your oppressors to die. Since I can’t Orlando my way out of that and my green card expires in 2019, I will probably be relocating elsewhere, as I would also expect – as I’ve seen an increasing level of scrutiny of personal views for immigrants – that my activism history and social media would make my greencard renewal not a smooth process.

  187. 187.

    WaterGirl

    @ruemara: That’s a pretty dim view, especially since it will be 2018 in about 15 days. I wish I could disagree with what you’ve said. It’s now or never.

  188. 188.

    The Moar You Know

    CNN’s Jim Acosts says @PressSec pulled him aside to warn him against asking Trump about his sleazebag attack on Gillibrand or he won’t be allowed back.— JoeMyGod (@JoeMyGod) December 12, 2017

    @germy: The press are morons. They hold all the cards here. The first thing Jim does is ask, in the conference, if he asks Trump questions about Gillibrand if he’ll be allowed back, yes or no. Then he asks the fucking question regardless of that answer. If he’s not allowed back then CNN raises holy hell about what the president has to hide. This is not hard. The press has internalized their own oppression, which is pathetic. They made Trump. They can just as easily ruin him.

  191. 191.

    germy

    I am deeply saddened by the passing of my friend, San Francisco Mayor Ed Lee. He was a fierce advocate for civil rights and worked tirelessly for workers’ rights and his leadership will be missed. Keeping the mayor’s family in my prayers during this difficult time. pic.twitter.com/SpU8EttETK— Kamala Harris (@KamalaHarris) December 12, 2017

  192. 192.

    NeenerNeener

    For what it’s worth, Politifact just announced their “Lie of the Year”: that Russia didn’t mess with the 2016 election.

    Of course, they’re also claiming that Russian interference had no impact on the results…..

  197. 197.

    Kathleen

    @tobie: DJ Hughley had a nice interview with Jones on his radio show today spread through a few segments. I was very impressed with Jones. He impressed me as soft spoken but intense.

  203. 203.

    Feathers

    @debbie: Ahem. A brilliant book by Virginia Woolf, adapted into a fantastic movie starring Tilda Swinton, directed by Sally Potter.

  204. 204.

    Aleta

    the people buying bitcoin right now are the folks who headed to the Gold Rush in California in 1856

    Or like the people who sat in their parlor in Ohio and bought a map of a gold mine and the mining claim from some guy they’d never met before.

  207. 207.

    Roger Moore

    @marcopolo:

    So Arnold riding a green bike through the streets of Paris means what exactly?

    It means he’s the same publicity hound he’s always been, and he’s still worried about global warming.

  209. 209.

    No One You Know

    @HeleninEire: I was hanging in a bar with some folks I didn’t know well. One guy kept hyping Bitcoin, but couldn’t actually describe what it was. Kept referring me to “go look online and learn.” Dude, if you can’t define this thing you’re excited about, I’m not going to “go look it up” on your day-so.

    He thinks he’s going to pay of his residence with something he can’t explain.

  210. 210.

    Uncle Jeffy

    Given that there are supposedly 21 million bitcoins in existence and they are priced at about $20,000 per, the market cap of Bitcoin works out to less than half of the market cap of AAPL. So my conclusion? Virtually (pun intended) no effect.

  211. 211.

    Aleta

    @germy: They’re not accustomed to following instructions. They feel no pressure to do anything correctly. Someone will fix it, and they’ve always been shielded from exposure. I think it’s why they commit such blatant crimes and stupid errors.

  212. 212.

    Aleta

    @NotMax: his horse? I bet that horse never saw him before in it’s life. They put him on a gaited horse thinking he’d look like a smoother rider.

  215. 215.

    TenguPhule

    @Redshift:

    quite a few police departments may be contributing to the “full employment for lawyers fund” in the coming months…

    Weren’t we already at peak lawyer once Trump started doing illegal shit in the White House?

  216. 216.

    TenguPhule

    @tobie:

    Fighting voter suppression has to be a number one priority for the party.

    Its not. Ousting seated Democrats is.

  218. 218.

    schrodingers_cat

    @ruemara: Unless they have changed the forms dramatically since a year ago, it should take you no more that a couple of hours to fill the form. The most difficult part was to precisely give an account of the time that you were not in the country, your arrival and departure dates. If I can be of any help, please let me know. IIRC there is also financial assistance available for those who qualify.
    ETA: I made a quick check and the form seems to be the same.

  219. 219.

    Chet Murthy

    @Matt McIrvin:

    nothing about the blockchain tech that inherently requires it to be absurdly deflationary or quite so energetically expensive

    Uh, I’d be interested in what you’re referring to. Certainly if “blockchain tech” is construed to include the requirement of “neither need nor possibility of centralized controlling authority or consortium” (== “censorship-resistance” FWIW (and I ROFL at the idea, just to be clear)) I don’t see how you avoid the latter problem. Specifically, I see no evidence that the imbeciles behind all this blockchain stuff understand what “proof-of-stake” (the only contender I know of to solve the “energetically insane” problem) actually is (they couldn’t write a protocol correctness proof to save their lives). And everything else is based on a centralized controlling authority, so unsuitable .

    As for “deflationary”, it’s (a) part-and-parcel of the mindset of the folks in that world, but more importantly (b) IMPOSSIBLE to avoid. If you want to avoid (again) a central authority, at *best* you could have a fixed rate of coinage (as is true today) forever.[*] That rate MUST be much, much lower than required to actually satisfy the liquidity needs of a real OECD nation, b/c bitcoin starts off as a tiny, tiny economy, and any really high rate of coinage would result in crazy inflation in the early days, right? But then as the thing ramps up in popularity, you’ll eventually reach the point where the GROWTH RATE OF ADOPTERS alone is enough to cause deflation.

    [*] think it thru: you want a way to manage the rate of coinage of some currency, but without a central authority. How do you do it? At some point, you gotta count votes. But we all know the old saying about “he who counts the votes”. These jokers fundamentally don’t believe in institutions composed of humans. So they can’t accept any of that. Which is why the coinage rate of BTC is all controlled by fixed algorithms.

  220. 220.

    Chet Murthy

    @Chet Murthy: After reading a bit more of the thread, I thought I should note that there’s “blockchain technology” and then there’s it’s application to cryptocurrencies. It is true that “some kinds of blockchain technology (it’s a broad church)” don’t have the kinds of ridiculous energy issues that bitcoin’s use does (“proof-of-work”). It is -also- true (I believe) that if you want bitcoin’s purported libertarian/anti-government strong-points, you’re *stuck* with proof-of-work, and hence with the ridic energy consumption.

    There’s some fundamentally stupid ideas baked into the bottom of Bitcoin. Fundamentally stupid. And I say this as the guy who designed the Hyperledger Fabric archtecture (not that that’s some claim to brilliance — it’s straightforward stuff, and IBM still managed to fuck it up). I think I -do- understand the alternatives to “proof-of-work”, and why they’re not acceptable to the (uh) cyber-crypto-lol-bertarians.

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