What is Digital Money and how is it linked to our daily Life?
Why do prices go up?
When Gold prices shoot up gas prices shoot up, commodity prices go up.
When they come down the prices of commodities still go up.
But in each case we are told that the price is due to each phenomenon and will go down when the trend shifts the other way.
It doesn’t happen are left with twiddling thumbs.
Reason a non sense called Keynesian economics, and Gold Standard.
Please read my posts on these .
Now the expose of this fraud called Money (Digital) is exposed by BBC.
I am not commenting and you can draw your conclusions.
Story:
Born at the start of 2009 in the aftermath of the global financial crisis – courtesy of a mysterious and possibly non-existent Japanese programmer calling himself Satoshi Nakamoto – Bitcoins are a mathematical concoction, combining the attributes of a scarce commodity, like gold, with the frictionless trading of an electronic currency. They achieve this through the ingenious combination of three factors: “mining”, peer-to-peer networking and cryptography.
The first of these is one of the central reasons for their appeal. Despite being wholly electronic, every Bitcoin in existence has been “mined” by someone running Nakamoto’s software, which regulates the global supply of Bitcoins by forcing computers to crunch increasingly difficult equations in order to generate each coin. Coins emerge at a pre-determined rate: as more people use the software, it gets harder and harder to create them, with the global supply decelerating geometrically towards a predetermined limit. At the time of writing, there were a total of 11,023,350 Bitcoins in the world (one of the joys of an open digital currency is the ease of accessing statistics), and there will never be more than 21 million.
Like everything else about Bitcoins, these factors are hard-coded into its software – and it’s the peer-to-peer element of this software that makes the system so compelling. Almost every modern currency is guaranteed by the “fiat” of government regulation or laws. That is, their worth is based on faith in a central authority – and is undermined when faith declines in that authority…
The recent surge of media-driven interest in Bitcoin has, however, shown every sign of becoming a speculative bubble. Come 10 April, the exchange value of Bitcoins plummeted by 60% from a brief high of $265 to around $150. These are numbers that belong more to a volatile commodity than to a currency, and that emphasise an uncomfortable paradox noted by Reuters finance blogger Felix Salmon at the start of April: “The commodity value of bitcoins is rooted in their currency value, but the more of a commodity they become, the less useful they are as a currency.”
As a currency, then, failure is already in the air. Yet this does not mean that the Bitcoin effect can be ignored, not least because it can be divided into two halves. On the one hand, there’s the computerised mining of a commodity strictly limited to a certain number of units. On the other hand, there is a genuinely trans-national medium for payment that is free of almost all the friction of a traditional financial system – and that brings with it a promise of security more transparent and verifiable than any bank or government can match.
Bitcoin’s software is entirely open source, and this means that its security algorithms have been subjected to just about the most rigorous testing and attempted cracking the world’s geeks can come up with. The consensus is: they’re extremely secure. Moreover, should the cryptography at some future point be found wanting, its flaws will almost certainly be identified and updated far faster than with any private system (a major software issue in March was resolved within six hours).
http://www.bbc.com/future/story/20130412-bitcoin-and-the-illusion-of-money/2
Related articles
There are a couple of things which defy Logic and common sense.
For instance,
The ever Increasing price of Gold.
The Price of Petroleum Products.
http://ramanisblog.in/2013/02/10/who-controls-the-worldeconomy-gold-petroleum/
Leave a Reply