Comment by pearkes | Hacker News Reader

Comment by pearkes | Hacker News Reader

> A friend of mine, Steve, noted that gold-backed economy logically evolved into the mess we are now

Here is where you lose me.

Other articles, just like this, fall apart in the same places.

Maybe it is the irony of this statement.

Why is it ironic?

I'm reading your blog post, hosted on Tumblr, on the east coast of the United States, judging on the pings from where I am in Germany. The communications travel over fiber-optic cable in the Atlantic Ocean. This cable was laid by a partnership between commercial telecommunications companies[1]. Tumblr is supported by this "mess" of an economic system, and thus gives you a platform to talk on. Tumblr's hosting provider leverages this "mess" of an economic system to invest in making it's infrastructure better, cheaper and more reliable for Tumblr.

Why is this rhetoric so unaware of history? Why does it carry such a negative outlook on the incredible things that this imperfect economic system has delivered us?

By all means continue questioning, improving or changing the system we have arrived at as a collective humanity. But please, do not pretend everything is a horrible mess that only some minor [crypto-currency, technology] can fix. Admit that what we've done so far has largely been pretty damn good.

Will the new ideas help? Hopefully, likely!

[1]: http://en.wikipedia.org/wiki/Transatlantic_communications_ca...

> A friend of mine, Steve, noted that gold-backed economy logically evolved into the mess we are now

While the statement is not explicitly clear, I wouldn't call the above assessment a fair characterization of its intent.

It is widely acknowledged that paper currencies evolved as a proxy for gold in day-to-day life, which gave rise to the fractional reserve system, which gave rise to paper currency as a measure of debt rather than a measure of value, which gave rise to the ever-widening wealth gap, and so on and so forth.

> which gave rise to the ever-widening wealth gap

That is not widely acknowledged. While the wealth gap may be experiencing recent growth, especially in the postwar period, over the period in which paper currency replaced gold, the wealth gap has improved dramatically.

False cause. There are many significant variables such as technology that have changed over this period. Any claims to cause must provide data which isolates these and the widely acknowledges claims do not.

This is an argument that can be leveled against the vast majority of non-exact science experiments. You can make the same argument against all non-theoretical parts of economics, "large scale" physics, climate theory, and all humanities.

Therefore in most sciences (essentially outside of logic and theoretical mathematics) this argument is considered invalid. It's not wrong, but it's useless and counterproductive : it precludes most scientific progress.

Economics (the practical kind) is the study of a chaotic system that is formed by the intentions and actions of all humans on this planet, and lots of phenomena that don't even originate on this planet (e.g. the distribution of minable materials on our planet is the result of tiny pressure differences in our solar system's previous sun (the one that went nova and eventually re-coalesced into the current one)). Therefore you can obviously say that whatever economics comes up with is inaccurate (limited, and unknown, accuracy), and sometimes has chaotic phenomena (meaning theory and practice diverge a little bit, but the difference blows up quickly over time and prediction versus reality become unrecognizably different).

Even though random large changes are possible, and in fact chaotic phenomena happen regularly outside of economics too (the ejection of rocks from the asteroid belt is one example that is repeated daily), but we happily perform science as if it never does.

Is it correct ? No

Is there any other way ? No

The article made many references to the economic gap between the rich and poor, stating that the "big banks" had all the gold, while everyone else had "worthless IOU's."

The "mess" isn't suggesting that the world is an unlivable dystopia. It refers to the fact that there are a few people with a lot of money, and only they have the ability to handle that much money. Bitcoin flattens the playing field, thus resolving the "mess."

This is only true if you make the BIG assumption that everyone has valuable contributions to make to the global economy. There's various evidently false things it depends on, like that no-one is both successful and hoards money just for the fun of it.

So this is not true. I would even argue it's very, very not true, and that the medieval economy illustrates this. It was a lot like a bitcoin economy : unfalsifiable money (gold) in limited supply. Most people unable to contribute in any meaningful sense.

What did we see ? Equitable distribution of goods and services (and gold) ? Hell, no.

Of course, bitcoin is in the moronically stupid position that it both depends on the economy it has doesn't exist (power, and bitcoins MUST be divided over many players that don't trust eachother for bitcoin to work) and it itself is a centralizing force.

And that's ignoring the fact that it depends on preimage-attack resistance of SHA256. That's currently true, but keep in mind that it's 12 years old and the previous standard, MD5, held out for ~17 years. Whilst I would say it'll likely last a bit longer than MD5, it's (overwhelmingly likely) not immortal.

It's a fallacy to look at what you can see and not count in opportunity cost and what could have been done if there were no economical disasters created by governments all over the world. We'd probably had flying cars already and free wi-fi everywhere if people were allowed to save money and invest how they like.

During Putin's regime computers got 12 times faster too. Is it thanks to "stability of the economy" that Putin provided?

Flying cars are a social problem more so than technical. Not even a super-fiat currency like Bitcoin would solve that.

At least, when everyone is on Bitcoin, you can't shift purchasing power to you (via inflation or massive taxation) and have bigger vote on how cars should be designed. You have to earn your vote (make people send you bitcoins voluntarily) to shift the status quo.

Agreed, the same fallacy is used by brainwashed soldiers and other people to defend wars. They say we wouldn't have the GPS, the Internet, canned food, etc., and that we shouldn't complain, and that it's ironic that we do it using the Internet.

Reply on news.ycombinator.com