Wednesday, August 14, 2013

Bitcoin?

With the Fed printing money out of thin air, at a rate of 85 billion a month, it is clear that the dollar is highly manipulated, and losing it's purchasing power by the day.

Other than gold or silver, the classic store of value, other alternatives are springing up, which attempt in a serious way to address the problem.

Just yesterday the Bitcoin option broke through to the mainstream media to the extent that my wife saw it, and asked me what the story was with this odd alternative currency.

Here, for those that might be interested, is a summary of the Bitcoin saga from one of it's founders.

And here is a contrary view from the always opinionated Karl Denninger.

And then a follow up response from the netizens to Karl's skeptical ideas.

Personally, I think Bitcoin will work in it's own way right up until the time the government decides to put a stop to it, at which point it will all disappear into worthlessness.  The modern reality is that if the governmental power decides that your wealth should be theirs, or you should not have it at all, it will make your wealth theirs.

As to precious metals, in the thirties Roosevelt made it illegal to own them with a stroke of his pen, and then confiscated most of them from the public.  While we can hoard all we want now, our right is dependent on the whim of the political powers. As soon as the politicians see either as a threat, they will make ownership or use of either impossible without great risk.

Your real property you own only as long as you can pay your property taxes.  Try refusing to do that for very long, and you will find out you only own your paid off property at the pleasure of the state.   You are really currently renting it from them, the rent being your property tax, and they have complete control of the amount of rent you need to pay.

I salute Bitcoin as a valiant attempt to create real wealth that exists outside the control of the state, but I'm hugely skeptical that it's any better than anything else given the power and resources that the government can bring to bear should they want to take it away from you.

As citizens, our only true option to protect our wealth is to strictly control the power of government.  Once they gain enough, as they have now, they are our kings, and there is really no option that cannot be made invalid at any time if they decide that they want what you have.  Since that power has likely now passed from our hands permanently to those of the politicians and bureaucrats, there isn't a good way to really, permanently and surely, protect the fruits of your labor or investments.  Only a true revolution at the ballot box can restore that balance of power, but now, with so many dependent on the state taking wealth from those who earn it and redistributing it to those who don't want to work for it, the ballot box has become a very sketchy protection.

With the current administration recognizing clearly that the source of their power comes from making the dependent class as big as possible, and with the vast majority of the electorate ignorant of the reasoning behind these plans, there is scant hope, in my opinion, that the sharp reduction of the power of government needed immediately to stop this terrible trend will even begin to happen.

Enjoy your Bitcoins while you can.  Enjoy indeed your property, your stash of gold and silver, and the purchasing power of your dollar bills while they are still in any way under your control.  The extent to which your dollar is yours, and the extent to which it can be used in exchange for anything of value, is the decision of someone else.

1 comment:

  1. Firearms and ammunition have a perfume all their own.

    ReplyDelete