Archive for the 'The Facts' Category

Bitcoin is not a threat, it is a boon

Tuesday, May 14th, 2013

The Financial Times has published an astonishingly blinkered and short-sightedarticle, where Bitcoin is mischaracterisedas a threat, instead of the greatest business opportunity of the century.

The fact of the matter is, and I have said this before, the country that puts a 150 year moratorium on all Bitcoin regulation and ‘supervision’ will reap all the Bitcoin entrepreneurs in the world, who will run to incorporate in that territory. This event will spark a Hong Kong style boom without precedent in size, and of course, all the businesses located in that territory, should it be the UK, will be paying corporation tax on the profits gleaned by providing services to Bitcoin users world-wide.

It seems however, that the socialists andKeynesiansat the FT are squarely ant-British, anti entrepreneur, anti progress and computer illiterate to boot.

Lets take this article to pieces, starting with the sensationalist and irrational title:

Taxmen, police and spies look at bitcoin threat
By Jane Wild

This is anentirelymisleading title. Unless you believe that profit and human progress are threats. The advantages Bitcoin will bring to commerce world-wide are easy for even a child to see.

Mobile phones are everywhere. MPESA is absolutely huge in Kenya. Itdoesn’ttake much to understand that Bitcoin is MPESA for the entire world, only orders of magnitude bigger and better because it can never be gamed or corrupted.

The country that ends up being the “Home of Bitcoin” will have trillions of dollars worth oftransactionsflowing through it, and will skim taxes off of the top of theactivity. Anything that hinders this is going to cause the entrepreneurs building these fledgling systems to go to otherjurisdictions. The UK must shun the voices that call for regulation and exchanges as the legalized model, because exchanges are not the only possible business model and regulation will drive entrepreneurs away.

Bitcoin has come onto the radar of the UK government, with officials gathering in London on Monday to discuss the security threats and tax concerns posed by the digital currency.

This is a very bad sign. It is a bad sign because no one really knows what Bitcoin is or what its potential is. No one knows the perfect Bitcoin business model; this is still being actively discovered. No one can even define Bitcoin; people are stillarguingover its true nature. It is therefore highly unlikely that anyone is able to predict the future of what Bitcoinbushinesseswill look like. Its too early to legislate, if legislation is needed at all, and of course, we hold that it is not.

About 50 civil servants from HM Revenue and Customs, the Serious Organised Crime Agency, Home Office and GCHQ the intelligence listening service held a one-day conference which examined how bitcoin works and how criminals might seek to exploit the electronic cash system, which is currently unregulated by any financial authority.

Its interesting that the only thing that is being considered is how to disrupt entrepreneurs; that is ofcourse,the implication of these sorts of people gathering to discussBitcoin.They were not there to discuss what they are not going to do, after all.

Imagine such a meeting taking place in 1995, before the internet and the web exploded and increased the flow of goods and knowledge beyondanyone’simagination. Imagine that these same people met and decided that an unregulated internet was “not acceptable” and thatlegislationneeded to be tabled to regulate who could publish on the internet, who could be an email provider, etc etc. It would have killed theinternetin the UK, causing an unimaginable amount of permanent damage. This is what will happen to the emerging Bitcoin economy if anything resembling regulation touches Bitcoin. The businesses trying to start here, that can incorporate and operate anywhere in the world, will simply do so in a place other than Britain. The Bitcoin will flow around this damage, and the UK will not profit, as the money and talent flees to a free jurisdiction. This is undesirable.

The meeting, entitled The Future of Money, focused on the implications that widespread adoption of the currency might have. As bitcoin users are anonymous, authorities worry that it could be used for purposes such as money laundering, and that transactions between individuals fall outside boundaries of tax collection.

Rather than focus on the majority use case that is inevitable with Bitcoin, these ill informed and well meaning people are being entirely mislead.

OnceBitcoinis flowing between devices, it will be impossible to track, and moving very quickly. Bitcoin will suck up fiat currency world-wide. The jurisdiction that allows exit and entry points to operate in it will make massive amounts of revenue, and the Bitcoin will simply flow through the countries where it is either impossible orunfavourableto operate.

It is important to understand what Bitcoin is, not in the monetary sense, but in the data sense. Bitcoin is data. It can flowwhereverit is pushed and pulled. It cannot be stopped, any more than Bittorrent can be stopped. Its users will be everywhere, all at once, all the time, always on. Will it be used for unethical purposes? Yes of course; but these will be very rare edge cases, as all crime is an edge case. The difference here is that we are talking about pure information, that is very fluid; as fluid as liquid heliumnearabsolutezero. It flows without friction, up the sides of the container it sits in against gravity. It cannot be stopped; but it can be tapped for revenue. Understanding data and how the world has changed will prevent forward thinking countries from being totally sidelined.

No amount of building projects (“Silicon Roundabout”) or talk will convince entrepreneurs to build their companies in the UK. Anyone thinking about incorporating in the UK to start a Bitcoin service now has cold feet.

If the government decides to act with its Luddite hat on, there will be little point in startinganythinghere, and those that have, will simply run a shell script to move their businesses to servers in free countries. It will take less than an hour to move operations to any jurisdiction anywhere in the world, and we need only look to The Pirate Bay to see how quickly a high traffic website can move from one place to another. The Pirate bay is an operation underextraordinarilyheavy attack; its operators are scattered, its servers constantly being shut down. They do not make a profit and pay no corporation tax; a website that is not doing any infringing or harm, and that is making a profit and paying corporation tax in large amounts, like MTGOX, will be very welcome in many jurisdictions, who will make special rules toaccommodatethem.Britainmust not go down the road of the Luddite and the anti-technology fanatic. There is nothing to gain from doing it. The business will go elsewhere and the British will still be using Bitcoin by the millions.

The Revenue said that its attendance at the conference had been to further its understanding of current tax-related issues and that it was monitoring the development of the bitcoin market. The tax system already deals with transactions in currencies other than sterling, the department said. Any such transaction will be potentially taxable.

Any company incorporated in the UK is subject to tax on its profits. A Bitcoin company operating in the UK will be making a profit and submitting returns every year. This is not an issue different to the operation of any business that currently operates in the UK, and Bitcoin should not be the focus of any kind, since it isjustanother kind of business, like selling soft icecream.

Also under consideration was the idea of creating a regulated exchange, which would be the worlds first. Such an entity would go some way to addressing concerns about criminality by requiring users to provide proof of identity. An unregulated exchange was set up in London in 2011 but closed a year later after its bank account was shut down.

This just demonstrates the near horizon thinking of the people who attended this conference. Bitcoin exchanges are not the only business model that can be built on this new technology.

For example, there is a new business, Bitspend (notoperating from the UK) that allows you to buy anything in the world with Bitcoin. You select what goods you want, inform the website of your choice, pay them Bitcoin to the amount of the purchase, plus their fee, and they purchase the goods for you and have them dispatched to you directly from the seller. Theydon’teven have to handle the goods, all they are doing is making purchases on other people’s behalf.

This business has nothing to do with Bitcoin Exchanges. It is a pure service that uses Bitcoin as a money transport. A business like Bitspend could operate in anyjurisdiction, since it is buying goods over theinternet. They are based in the USA, and as they grow,theirsoftware will become more robust and reliable, and their customer base will grow. New business ideas and opportunities will come to them first. People in the UK can use this service transparently; it is a perfect example of Bitcoin flowing through the UK without ever touching a UK incorporatedentity. The question then isobvious;why should this business leave the USA and incorporate in the UK? What advantage is there for them to do so? What inducements can be put on the table to cause Bitspend to move to the UK so that its profits are taxable in the UK?

These are the correct questions that should be asked; Bitcoin should not be mischaracterisedas a threat, but as anunprecedentedopportunity, and something that should be used to attract entrepreneurs and visionaries to London.

Many more Bitcoin companies are being planned and developed right now in a myriad number of different models and forms. Conferences are being held in Romania and California. Britain is going to be left out of thisimportantrevolutionif the wrong noises are made and disseminated.

The web was born in the UK, and thecentreof the web’s entrepreneurial activity is all in California.

Why?

Why is it that the British invent all the great things and other people in other countries capitalize on them? Why isFacebookeverywherein the world, and Bebo, early star in social networking, filingfor bankruptcy protection?

Britain has the brains, it has the talent. Its young people have the entrepreneurial spark.Bitcoinis going to be thebiggestthing since theinternetitself. If Britain drives entrepreneurs in this sector away, it will not get a second chance.

The Future of Money conference, which included presentations on how the cryptocurrency works, was organised by the governments Foresight Horizon Scanning Centre, an arm of the Department for Business, Innovation and Skills which develops innovative, long-term policy. Although unofficial meetings have been held previously, this was the first official meeting of civil servants held to discuss bitcoin. No government ministers were present.

Bitcoin and its growing ecosystem was created by developers. It did not need the State to help it, design it or get it going. Like the internet, it will grow at its own amazing pace if left to do so. Anything that touches it will distort its natural geometric growth.

What must be understood here is that the threats presented by Bitcoin are absolutely minuscule, molecular even,when compared to the planetary scale big picture; it is exactly the same as the internet itself. The vast majority of internetusageis absolutely harmless, ethical, beneficial and normal, and the same will be true of Bitcoin.

Policy, if any is to be made at all, and it should not, must be driven only by the facts andeconomics.If not, Bitcoin will see it as damage and will route around it. The Bitcoin will flow through and out of the UK, rather than coming in and terminating here; and that is what, surely, the government must want – for Bitcoin to begin and end in the UK, so that the businesses that provide the services can aid the economic recovery.

And what an aid that will be. Trillions of dollars and Pounds in Bitcoinon a weekly basis, flowing through UK based nodes that are all as trusted aseBayand built to thehigheststandards, just likeFacebook, but without any regulation, just likeFacebook.

This is the ideal situation; TheFacebookofBitcoin incorporated inBritainshowing the world that London is thecentreof the emergent Bitcoin economy. “If you want to be where the Bitcoin action is, London is your Go Todestination”. This is what we want to read!

Michael Parsons, a banking management consultant and chartered accountant who presented at the event, said: There were a lot of questions. Everyone was very receptive and keen to learn more.”

!

GCHQ confirmed that it had sent staff to the conference in the interests of its role in helping to deliver cyber security.

Bitcoin is not a “cyber security issue.”

Its very important to characterise thesetechnologiescorrectly. At the beginning of the Internet, I am sure that there are people alive now, who would characterise ISPs as “cyber security threats”. Of course, acting on any such mischaracterization would have fatally crippled thenascentISP and web industry, and caused Britain to be an also ran in the internet stakes. As it happened, despite the telephone monopoly of BT, the ISP business in the UK thrived and produced many wonderfulspin-offsin terms of new businesses and skilled developers, many being of world importance. This should be the aim with Bitcoin also. Britain should seek to nurture, by keeping an arms length from it, all Bitcoin relatedentrepreneurialactivity.

As we have seen with Hong Kong, once all the work is done, there will be a glistening jewel of activity to collect at the end of theexercise.Only a hands off policy can create such jewels, and in the case of software businesses, the jewel is quicksilver, that can flow very rapidly to the place where regulation is lowest. Business is mercury that always seeks its most efficient level.

And let us remember; Bitcoin is hardly being used for anything at all at the moment. What everybody thinks it is and what it could be used for is pure speculation. A cautious, future centric position is the best one to be taken, because either way, the Bitcoin is going to flow, and that flow cannot be stopped without stopping entire internet.

Some people might say that websites can be blocked,whichwill stop people in the UK from getting Bitcoin from otherjurisdictions They will cite the blocks on The Pirate Bay and Kickass Torrents assuccessfulexamples. This view is entirely incorrect.

A small browserextensioncalled Stealthy makes all ISP blocks moot. It is currently installed by 277,794 users, and it is sure to grow in its user base. This is but one very easy ways to completely circumvent ISP blocks on websites, and of course, once you get your Bitcoin on your mobile phone or laptop, it is a pure peer-to-peer system, that cannot be blocked at the ISP level.

With the Stealthy plugin, all ISP blocks are completely defeated. That means it will be impossible to block any website in anyjurisdictionselling Bitcoin.

The normal reaction process of problem, reactionsolutionwill not work in thetwenty-firstcentury. A newmodelmust be designed andimplementedthat utilizes these new tools so that everyone benefits.

Bitcoin and theinternetitself are entirely beneficial and should not be regulated, but should instead, beharnessedand their utility leveraged.

Rather than having a meeting to discuss fallacious ideas and imaginary threats, meetings should be held to see how Bitcoin can reduce the cost of government.

Imagine the following applications for Bitcoin.

  • Paying parking fees and fines.
  • Collecting taxes. In micro amounts.
  • Paying usage fees for all government services. In micro amounts.
  • Reducing all money related fees on flows into and out of government, saving billions.
  • Disbursing benefits at a fraction of the current cost.

These are just some the sorts of things that should be discussed at the government level, not how this baby should be killed before it is born.

This is an opportunity for increased efficiency, transparency, speed and effectiveness in the way government collects and disburses money. This is the sort of thinking that should be on the table, notLuddite dreams of wrecking the internet.

Civil servants will now prepare two reports for ministers on their conclusions: one public and one private.

FT

These reports, both the public and the private, cannot possibly present a complete picture. The Bitcoin business models are still being developed and iterated through. No one knows what the final, profitable and viral shape of Bitcoin businesses will be; the only thing that can be predicted is that there will be a final shape, and that the company that hits on it will be incorporated in somejurisdiction, and that it is in that jurisdiction that the money will flow.

The question here iswhetheror not that country will be Britain. Articles like this, and any move by Her Majesty’s Government to control Bitcoin will cause Bitcoin to bloom elsewhere.

No amount of Silicon Roundabout development, ribbon cutting and pleas to come toBritainwill make the UK attractive. Only a guaranteed, decades long moratorium on any interference in Bitcoin activity will attract entrepreneurs and investment in this once in a lifetime event.

The FSA letter on Bitcoin sent to Intersango was an encouraging sign that Bitcoin was to be left to flourish. I will leave it to you to imagine the next MTGOX starting in the UK (or for that matter, the next MEGA that has grown to dominate New Zealand internet trafficand will be an economic powerhousethere with its soon to be announced new services); there is simply no reason why such a company should not start in the UK and grow to a size greater than MTGOX, as second and third generationsuccessfulBitcoin business models begin to emerge.

The question is will the correct business conditions exist to facilitate this emergence, or not?

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The Conet Project: Like Something Out of a Spy Movie

Friday, November 16th, 2012

About 20 years ago, Akin Fernandez discovered mysterious sounds and voices being transmitted over shortwave radio stations called “Numbers Stations” that weren’t documented anywhere. With more research, Fernandez realized that these stations had been used during the Cold War to transmit secret messages from intelligence agencies to their spies … but they were still being actively used though the war was long over.

Such began The Conet Project, which was first popularized when Wilco used a portion of one of the recordings, a woman saying “yankee hotel foxtrot,” in their song Poor Places and as their album title and were later sued for copyright infringement.

Here, we asked Fernandez to write out a description of the project that carries such a mystery with it. Have a listen to a portion of the project in the above clip.

Where did you first get the idea for a project about shortwave numbers station recordings?

In the early 1990s I discovered that you can receive weather maps and satellite images by shortwave radio with a simple receiver and an inexpensive demodulator that attaches to your computer. I put it all together and started to decode weather satellite images from all over the world.

Whilst trying to tune into stations that were transmitting these satellite weather maps and photos, I kept coming across stations that were transmitting strange voices reading out strings of numbers and letters. In one of the frequency guides I owned, there were entries for some of these stations, listed simply as Numbers Station, with no other information.

In order to understand why this is odd, you need to understand how shortwave radio transmitters are licensed and how they behave when they are legally operated. Each licensed radio station on the air is given permission to operate by a government. If it is not, it is a pirate station operating illegally. Each station has call letters, an address, and when they transmit, they announce who owns the station, where it is on the globe and the schedule of transmission times and frequencies. If you write to them with a reception report, they will send a QSL card back to you to say thank you.

The only people who do not conform to these standards are pirates, or people using shortwave for their licensed private use, like ships at sea, and in those cases, you sometimes hear people having conversations with each other.

Numbers Stations had none of this. They did not identify themselves as a licensed station should. They were clearly not pirates, because there were too many of them, transmitting all over the dial in many different forms, and their signals were way too powerful for a man in his garage to be operating. They clearly were not two-way radio telephone calls. These were something different, and the scant information that you could find about them in the 1990s bore this out.

To my astonishment, there were no good sources of information about Numbers Stations. There were a few small books printed by enthusiasts (normally printed very cheaply and bound with staples) filled only with facts you could glean for yourself if you listened to a shortwave.

This was a real live mystery, taking place on a global basis, unreported, scantily documented and passing though the bodies of billions of people every day. Everyone I asked about Numbers Stations didn’t know anything about them. The British Library didn’t have any recordings of them in its collection. There were even some shortwave radio listeners who were huffy and defensive about them, describing them as nonsense.

It was about that time that I lost my mind and had to know everything about Numbers Stations that I could find. I couldn’t stand the idea that this was going on and no one knew about it.

Here was something that had been going on for decades, that had never been reported on in a newspaper, that was inexplicably missing from the plotlines of every James Bond and spy movie ever made, and that was going on unabated after the end of the Cold War. This is something that had never been documented in the National Sound Archive in the country that built Alan Turing’s ENIGMA breaking computer, or indeed that is mentioned anywhere by the people curating the espionage relics of war.

Surely, this could not be real, but it was, and it fell right into my lap.

It was at this point and with all this scant information and the red rag to a bull of Numbers Stations in my face and ears that I decided to stop decoding satellite weather photos and start recording and logging Numbers Stations.

Some might think that this is all a bit odd. For certain, people who take that position have not ever heard a Numbers Station. These are not just plain white noises or unedifying, characterless transmissions likethe UKs Speaking Clock. These stations are very VERY weird; they are so weird that they sometimes exceed the emotional thrust of the inspired compositions of Avant-Garde music composers.

These stations, if you are interested in the sort of music that moves me, are a high form of musical expression, fueled by accident and chance, unique, unrepeatable, mysterious and deeply profound. Their lyrics are meaningful and meaningless. They are spoken by men, women, machine women and machine men. They are clearly designed by very creative, thoughtful, anonymous people. Add into this mix the distortions, reverberations and chance elements that the ionosphere superimposes on these works and the true nature of their purpose, and you get an art form, available worldwide, without precedent in human history.

This is why I released The Conet Project. It took me three years to compile it, and I destroyed my record label, and myself, to produce it.

Where does the name Conet Project come from?

It comes from the words spoken by one of the Numbers Stations which ended with the words Konek.

Some of the tracks actually sound like songs (i.e. Gong Station Chimes). Were you surprised by the musical nature of some of these?

Very. Not only is The Gong Station musical, but for example the Station XPH, which is not explicitly musical, has a mournful slow introduction, and its main body has a phrasing and tempo like a synthesized bagpipe piece. Many stations use music as identifiers, either recordings of pop songs or sets of tones repeating to notify the recipient. Or not. We do not know why these tones were used, because no one who was responsible for these stations has come forward to explain the reasoning behind the design of the transmissions.

Can you tell us a brief history of Irdial Recordings? How does a company gain a vision to put out a project like this?

Irdial-Discs started in 1987. I had some friends that were making wonderful music but who could not find a label to release their work, and I had some of my own work that I wanted to release that no one would release, so it became obvious that I should run my own label.

Irdial originally was designed to be a blend of Factory, Touch and New York Electro labels like Cutting as a starting point. I took all the things I loved about those labels, mixed them with the works of the people that I knew, and made something that was different to everything else out there in every way, from the sleeves to the sounds and the way we mastered recordings.

The most important thing for me is to not compromise. I hate compromise and accommodating the tastes and ideas of other people. And it has worked. It was clear to me that some of the people who were running record labels at the time that I launched Irdial were not really interested in what they were doing as an act of art. They were trying to balance breaking something new against the tastes of the audience, and they were frightened of taking risks.

Take for example, InSync’s 12-inch Storm. This track was mastered onto a cassette. It was rejected by several labels, simply because it was on a cassette. When I was offered it, I immediately mastered direct from the cassette and released it.

I tell this story because it demonstrates how people can’t think for themselves and can have something wonderful given to them on a plate but will reject it simply because they are not familiar with it, or because it comes in a format they mistakenly believe is bad.

Can you imagine what the answer would have been, had I turned up in a record label’s A&R department with the idea for a quadruple CD of Numbers Stations, with an 80-page booklet? The only way great things like this can come to light is if someone takes the risk and refuses to follow the herd. That is why I run Irdial-Discs.

You release your recordings under the Free Music Philosophy, but here youve gone the direct-to-fan route. Can you talk about your choices here in terms of getting the recordings out there to your audience?

Back in 1999, we had been on the Internet for two years. Irdial was one of the first record labels on the Internet. It was clear to me, after spending years in the BBS scene and watching the Internet grow, that it made sense to spread your music everywhere rather than keep it bottled up. This is why The Conet Project has now been downloaded over one million times and is on computers, iPods and devices all over the world.

It would have been very difficult to do this without the Internet, and of course today, its not unusual to see tens of millions of views of pieces of music on YouTube. Giving away music makes sense; superdistribution is the future. The question is, is there a place for record labels anymore, what is the nature of that role if there is one, and how can artists that make music make enough money to allow them to spend all their time honing their art?

I think an answer is coming soon, and certainly an aggregating platform like PledgeMusic is going to be at the center of this new activity, where the owners of it are curators, filtering in (rather than out) the highest art so that people can find who is making the interesting work.

Since the Internet is essentially an infinite space, everyone can coalesce into their own communities so that no sound maker is left out, and rejection from one curator does not mean death, like it used to before the independent label and the Internet.

People need music in the same way they need food. Music makers have been kept away from their public by the scarcity imposed by physical sound carriers. Now that this has changed, its a matter of organizing these forces of nature with software and new contracts to increase the availability of art and get the right sounds to the right people, whilst making sure the sound makers can eat.

Its an exciting time to be working in music, no doubt about it.

The Number 231

Saturday, October 27th, 2012

Prime Factors of 231 =3x7x11.

231 is a Triangular Number.

231 is a Hexagonal Number.

231 is an Octahedral Number.

231 is a 17-gonal Number.

231 is a 78-gonal Number.

231 is a Centered 23-gonal Number.

231 is the 22nd number which is the Product of 3 distinct primes.

231 is the triangle of 21 which is the triangle of 6 which is the triangle of 3 which is the triangle of 2. Thus, 231 , is a triangle of a triangle of a triangle.

16 can be Partitioned in 231 ways.

231 =7x33

The 231 two-letter combinations of the 22 letters of the Hebrew Alphabet referred to as the 231 gates of Sefer Yetzirah.

Two hundred thirty-one is the exact number of cubic inches in a U.S. liquid gallon.

The Year 231 AD
In the year 231 AD Origen, disciple of Ammonius Saccas, founder of Neoplatonism , was exiled in Caesarea.

Bitcoin and the generational divide

Friday, September 21st, 2012

This video is a visual representation of the difference between the Austrian School Bitcoin detractors and the people who understand what Bitcoin is, what it can do, and how it is the biggest thing since email.

On the right, you have James Turk the head of GoldMoney, who is old, and on the left you have Felix Moreno de la Cova, who is young. The old man doesn’t understand computers, cryptography or the internet. The young man does. They have a very illuminating and friendly conversation about Bitcoin and money, without confrontation, rancour or irrational nonsense like, “I just don’t like the product”.

This is how discussions should take place, and I have alot more sympathy for Mr. Turk now, because he is genuinely reaching out to understand something that is clearly incomprehensible to him, and he is not intimidated or defensive, is eager to learn and is patient and thoughtful.

We need people like James Turk, because he has a vast amount of experience to offer, and once he understands Bitcoin, I would say that his presence on a board of directors would be invaluable.

Compare and contrast this gentlemanly interview with the appalling article that just appeared at The Daily Bell (which I will not link to; one click from me is quite enough) where every sort of fallacy and nonsense is trotted out in what is a blatant attack piece trolling for clicks.

As I have said before at length, GoldMoney is a fundamentally flawed idea:

http://irdial.com/blogdial/?p=3103

and it is now suffering from its exposure to the State, and is becoming harder and harder to use thanks to suffocating regulations. The exact opposite is true of Bitcoin, which is becoming easier and easier to use, with better software and more outlets accepting it every day, and a response from the State which amounts to a shrug of the shoulders.

When the economic collapse starts to bite, I am betting that GoldMoney will be forced to shut down entirely, because it serves its customers against the interests of the State. The gold confiscation of 1933 is a precedent that can happen again in a heartbeat; this is not beyond the realms of possibility. People who hold real money with third parties are going to face the institutionalized theft of their savings. Bitcoin on the other hand, will never be shut down by the State, it cannot be confiscated en masse or stopped, just as Bittorrent will never be shut down.

Whatever your opinion on what Bitcoin is or is not, it is here to stay, and it is going to change everything. Wether or not you take advantage of it is up to you, but the future is not going to wait for you to wake up and catch up.

McDonalds Money: the solution to the banking and monetary crisis

Thursday, July 12th, 2012

It seems that another crack in the dam has appeared:

http://blogs.telegraph.co.uk/finance/thoore-scandalous-than-libor/

How long can it be before it cracks all the way and the whole creaking edifice bursts and the pressure is relieved?

Bad stuff is what happens when the state is involved in the production of money and the regulation of banking. Banking is no different to flipping and selling hamburgers; money is a commodity just like any other. The state should regulate neither banking nor burgers. If McDonalds was in the business of manufacturing money, there would be standardized, reliable, consistent money, redeemable everywhere on every high street, at a stable price.

As revolting an idea as this sounds at first, being people who know a little about good food:

it makes perfect sense. The McDonalds consistency ethic superimposed on the manufacture of money, free of regulation, would solve all the problems of unsound money.

Selgin outlines the foundation of this:

http://www.amazon.com/Good-Money-Birmingham-Beginnings-1775-1821/dp/0472116312

if you superimpose the Birmingham button maker money from the 1700s with McDonalds and modern computers, how this would work becomes instantly clear.

Bitcoin is voluntarist, not socialist

Thursday, May 17th, 2012

The idea of socialism is diametrically opposed to the core philosophy of a voluntary peer to peer system like Bitcoin. Peer to peer systems dis-intermediate the transfer of information and eliminate the need for an arbitrary governing authority or service provider. Bitcoin, like maths, has no philosophy and is neutral.

*****

Socialism’s basic premiss is that ‘property is theft’, and that all property, goods and services should be collectively owned for the benefit of all people in a coercive State with no opt out. Under a socialist system of forced organization, individuals do not have free use of their inherent rights, which are violently suppressed.

This is an inherently immoral proposition, where one group of people inevitably coalesce into an illegitimate ruling class to control and administer other people ‘for their own good’; the good of the collective. Even if this aggregation of power were not the case, no man or group of men has the right to force another man to relinquish his property.

Libertarians understand that there is no such thing as ‘the rights of the collective’ and that only a living individual human has rights. Chief amongst these rights, the ‘root right’, is the right of property. Read the rest of this entry »

The confusion over the nature of corporations

Thursday, May 17th, 2012

There is a great deal of deeply seated confusion about corporations, their origins and true purpose. People who are intelligent and well read in the field of the philosophy of liberty sometimes fall short when it comes to understanding what a corporation is, why people use them and what the true nature of them are. On the one hand, they are for voluntary association, and yet on the other, they rail against corporations. This is illogical.

As it is with anything complex, clear thinking is needed when you try to think about corporations. Lets begin by taking apart the myth that they exist as creatures of the State.

There is no reason that in a free society without a State that a group of people cannot band together to work on a project under rules that they select for themselves. They pool their risk, and (for example) decide that they do not want to put all their capital on the line should something go wrong and face a court, however founded, deciding that they are liable. Read the rest of this entry »

Refuting George Monbiot’s attacks on Libertarianism

Tuesday, December 20th, 2011

George Monbiot, world famous environmentalist and renowned anti C02 campaigner has chosen to launch an attack on Libertarianism.

Articles like his are more useful than annoying, because it provides Libertarians an opportunity refute all of his carefully made points, and introduce people to the true core philosophy behind Libertarianism.

First things first.

What is Libertarianism?

Libertarianism is one thing and one thing only. It is the philosophy carefully described by Murray Rothbard in his book, “For a New Liberty, the Libertarian Manifesto“. It is not anything other than this.

Libertarianism is not a basket of contradictory ideas that you can mix and match to suit your personal prejudices. It is an absolutely coherent, logical and perfect basis for ethical behaviour when it comes to other human beings, outside the realm of your religious beliefs.

It is important that this definition is set out before I begin. Murray Rothbard has exposed a system of philosophy that deals with the rights of man in the same way that Newton uncovered the laws of motion. It is air tight, irrefutable, testable and completely sound.

This is very important, because there are some who use the word ‘Libertarian’ as a prefix so that they can keep the bad ideas they are wedded to and graft them on to the soundness of the Libertarian philosophy, in an attempt to lend the purity and logic of Libertarianism to their broken ideas.

Libertarian Socialism (an transparent oxymoron) is a good example of this. You can read a refutation of Libertarian Socialism here. There is no ‘left libertarianism’, ‘rightwing libertarianism’ or any other word combination Libertarianism, just as there is only a singular form of gravity, or the Strong Force, with a single nature that you are bound to deal with in this reality.

And now, to Monbiot.

Freedom: who could object? Yet this word is now used to justify a thousand forms of exploitation.

If two people agree voluntarily to exchange goods, no exploitation has taken place. This is a common mistake that Statists like George Monbiot make. We will see in this essay that his thinking is very muddled in this and many other areas.

Throughout the rightwing press and blogosphere, among thinktanks and governments, the word excuses every assault on the lives of the poor, every form of inequality and intrusion to which the 1% subject us. How did libertarianism, once a noble impulse, become synonymous with injustice?

Libertarianism is not an impulse. A frog’s leg touched by an electrode is an example of an impulse. Libertarianism is a carefully defined explanation of the rights of man. It is neither right nor left wing.

The Occupy Wall Street term ‘the 1%’ are able to prey upon people because the State is the great facilitator of predation. Sadly, people from George Monbiot’s position will not consider that the State itself is the cause of all his problems.

In the name of freedom freedom from regulation the banks were permitted to wreck the economy.

This is not true. As usual, people like George Monbiot do not have any understanding about the true nature of money and banking. This makes it impossible for him to come to a correct analysis of anything to do with this subject.

The banking industry is a State controlled monopoly. The State mandates the reserve requirements, and prevents competition through arbitrary licensing. It also controls the form of money (fiat currency), which is backed by nothing and which loses value by a minimum of 2% per year by design, in the case of Sterling. The economy has been ‘wrecked’ not by the banks, but by the State, its fraudulent money and its Keynesian brainwashed regulators that have no understanding of what money is, where it comes from or what it is for.

I have a feeling that if George Monbiot had a complete understanding of money, he might move towards the Austrian School, and away from the idea that the State should control money. This might be a good place for him to start.

In the name of freedom, taxes for the super-rich are cut. In the name of freedom, companies lobby to drop the minimum wage and raise working hours.

Taxation is theft. The same State that steals money from the poor through its fraudulent money printing and inflation, uses violence to steal money from the productive who create jobs with their capital and enterprise. The idea that because someone is successful they should have more of their money stolen from them is not only pure evil, but it is why industry has fled the UK for countries where hard working and inventive people are not arbitrarily preyed upon.

The minimum wage is an unwarranted interference by the State in private contracts. It stops people from gaining work experience, and acts as a disincentive to hiring. It is completely misguided to think that the minimum wage helps the poor; it does not. It simply reduces the number of jobs available. This is, of course, a separate issue from the immorality of the State interposing itself where it is not needed or wanted or morally justified in interfering.

In the same cause, US insurers lobby Congress to thwart effective public healthcare;

The provision of healthcare has been distorted almost to destruction in the USA. Where treatments were once inexpensive, they are now exorbitant. Where insurance was once affordable, it is now out of reach of millions of people. This is entirely the fault of the State. Those who are old enough to remember a time before the State interfered in medicine understand that this is the case, from first hand experience.

the government rips up our planning laws;

Planning laws are not collectively owned; it is nonsense to say that they are ‘our planning laws’. Furthermore, everything beautiful in Britain was built before the introduction of planning laws; in fact, most of Britain was built without the regulation of the State, and it produced one of the most beautiful countries on Earth. The idea that the State is needed to regulate building is a very modern and very bad idea, and it is demonstrably so. It violates people’s property rights, makes buildings uglier and more expensive and these regulations should be scrapped.

big business trashes the biosphere.

Libertarianism is the best solution to the problem of pollution. The only reason why companies can get away with pollution is because the land and rivers are not owned by individuals. If they were owned privately, pollution would be stopped over night. There is an excellent section on this in the Libertarian Manifesto, and Lew Rockwell has a superb essay on this subject that you should read.

This is the freedom of the powerful to exploit the weak, the rich to exploit the poor.

Actually, this is the effect of the State, which keeps people weak, facilitates the exploitation of everyone, including the poor, who under the wing of the State, are keep in a condition of penury.

Rightwing libertarianism recognises few legitimate constraints on the power to act, regardless of the impact on the lives of others. In the UK it is forcefully promoted by groups like the TaxPayers’ Alliance, the Adam Smith Institute, the Institute of Economic Affairs, and Policy Exchange. Their concept of freedom looks to me like nothing but a justification for greed.

There is no such thing as ‘Rightwing libertarianism’. Libertarians accept as a fundamental principle the non aggression axiom which means that they cannot initiate force against anyone for any reason. This puts a very large constraint on the power to act on Libertarians, and it also means that Libertarians are very careful not to aggress against other people, meaning that their acts should not impact on the lives of others.

That George Monbiot does not know this, demonstrates that he has had no contact with or exposure to Libertarianism. If this were not the case, he could not have written these lines.

Greed is a subjective term. It is very much like preferring chocolate over strawberry. How much money is too much, how many houses are too many and all these choices are completely personal and arbitrary, and as long as you do not steal to get what you have, its up to you how much you want to accumulate. To put it simply, greed is not something that can be measured scientifically. In this context, it is a word used to smear people and nothing more.

So why have we been been so slow to challenge this concept of liberty?

What George Monbiot has done is craft a huge straw man. “This concept of Liberty” is not what Liberty is at all; it is his idea of what Liberty is, and it is key to his position that you are never exposed to true Libertarianism, because if you are exposed to it, it is very likely that you will be swept away by its purity, beauty and the sheer unadulterated truth of it.

I challenge anyone who thinks that I am wrong to read For a New Liberty for themselves.

I believe that one of the reasons is as follows. The great political conflict of our age between neocons and the millionaires and corporations they support on one side, and social justice campaigners and environmentalists on the other has been mischaracterised as a clash between negative and positive freedoms. These freedoms were most clearly defined by Isaiah Berlin in his essay of 1958, Two Concepts of Liberty. It is a work of beauty: reading it is like listening to a gloriously crafted piece of music. I will try not to mangle it too badly.

This is not the true nature of the conflict, and it exposes the lack of depth of Monbiot’s thinking, which cannot penetrate any further than what is before his eyes.

The true conflict is between the State and every living human being.

Social justice campaigners and environmentalists are all fighting inside an Inception scenario, where they believe they are battling for a win where in fact, the board that they are playing on is a completely controlled artificial space where it is not possible for them to do so.

If these groups want cleaner rivers and air, they should embrace Libertarianism and property rights, and push for an end to the State. In a world where there are no public spaces, pollution becomes absolutely intolerable. Smoke stacks, acid rain, litter, dumping sewage and industrial waste into rivers and every other act of vandalism becomes impossible, because everyone, literally everyone wants to keep their own property clean.

When a space belongs to no one, that is where the garbage goes. Environmentalists that truly want to clean up the earth actually want everyone to have a stake in keeping it clean. That means property rights in everything, no public property owned by the collectivist State. It is a hard pill to swallow for many people, but in reality, it produces what they want; a clean environment where everyone is converted into an environmentalist by default.

Put briefly and crudely, negative freedom is the freedom to be or to act without interference from other people. Positive freedom is freedom from inhibition: it’s the power gained by transcending social or psychological constraints. Berlin explained how positive freedom had been abused by tyrannies, particularly by the Soviet Union. It portrayed its brutal governance as the empowerment of the people, who could achieve a higher freedom by subordinating themselves to a collective single will.

I shall leave this to the pen of Rothbard himself:

27. ISAIAH BERLIN ON NEGATIVE FREEDOM

ONE OF THE BEST-KNOWN and most influential present-day treatments of liberty is that of Sir Isaiah Berlin. In his Two Concepts of Liberty, Berlin upheld the concept of negative libertyabsence of interference with a persons sphere of actionas against positive liberty; which refers not to liberty at all but to an individuals effective power or mastery over himself or his environment. Superficially Berlins concept of negative liberty seems similar to the thesis of the present volume: that liberty is the absence of physically coercive interference or invasion of an individuals person and property. Unfortunately, however, the vagueness of Berlins concepts led to confusion and to the absence of a systematic and valid libertarian creed.

One of Berlins fallacies and confusions he himself recognized in a later essay and edition of his original volume. In his Two Concepts of Liberty, he had written that I am normally said to be free to the degree to which no human being interferes with my activity. Political liberty in this sense is simply the area within which a man can do what he wants. Or, as Berlin later phrased it, In the original version of Two Concepts of Liberty I speak of liberty as the absence of obstacles to the fulfillment of a mans desires.2 But, as he later realized, one grave problem with this formulation is that a man can be held to be free in proportion as his wants and desires are extinguished, for example by external conditioning. As Berlin states in his corrective essay,

If degrees of freedom were a function of the satisfaction of desires, I could increase freedom as effectively by eliminating desires as by satisfying them; I could render men (including myself) free by conditioning them into losing the original desires which I have decided not to satisfy.

In his later (1969) version, Berlin has expunged the offending passage, altering the first statement above to read: Political liberty in this sense is simply the area within which a man can act unobstructed by others.4 But grave problems still remain with Berlins later approach. For Berlin now explains that what he means by freedom is the absence of obstacles to possible choices and activities, obstacles, that is, put there by alterable human practices.5 But this comes close, as Professor Parent observes, to confusing freedom with opportunity in short to scuttling Berlins own concept of negative freedom and replacing it with the illegitimate concept of positive freedom. Thus, as Parent indicates, suppose that X refuses to hire Y because Y is a redhead and X dislikes redheads; X is surely reducing Ys range of opportunity, but he can scarcely be said to be invading Ys freedom.6 Indeed, Parent goes on to point out a repeated confusion in the later Berlin of freedom with opportunity; thus Berlin writes that the freedom of which I speak is opportunity for action (xlii), and identifies increases in liberty with the maximization of opportunities (xlviii). As Parent points out, The terms liberty and opportunity have distinct meanings; someone, for example, may lack the opportunity to buy a ticket to a concert for numerous reasons (e.g., he is too busy) and yet he was still in any meaningful sense free to buy such a ticket.7

Thus, Berlins fundamental flaw was his failure to define negative liberty as the absence of physical interference with an individuals person and property, with his just property rights broadly defined. Failing to hit on this definition, Berlin fell into confusion, and ended by virtually abandoning the very negative liberty he had tried to establish and to fall, willy-nilly, into the positive liberty camp. More than that, Berlin, stung by his critics with the charge of upholding laissez-faire, was moved into frenetic and self-contradictory assaults on laissez-faire as somehow injurious to negative liberty. For example, Berlin writes that the evils of unrestricted laissez faire . . . led to brutal violations of negative liberty . . . including that of free expression or association. Since laissez faire precisely means full freedom of person and property, including of course free expression and association as a subset of private property rights, Berlin has here fallen into absurdity. And in a similar canard, Berlin writes of

the fate of personal liberty during the reign of unfettered economic individualismabout the condition of the injured majority, principally in the towns, whose children were destroyed in mines or mills, while their parents lived in poverty, disease, and ignorance, a situation in which the enjoyment by the poor and the weak of legal rights . . . became an odious mockery.

Unsurprisingly, Berlin goes on to attack such pure and consistent laissez-faire libertarians as Cobden and Spencer on behalf of such confused and inconsistent classical liberals as Mill and de Tocqueville.

There are several grave and basic problems with Berlins fulminations. One is a complete ignorance of the modern historians of the Industrial Revolution, such as Ashton, Hayek, Hutt, and Hartwell, who have demonstrated that the new industry alleviated the previous poverty and starvation of the workers, including the child laborers, rather than the contrary.9 But on a conceptual level, there are grave problems as well. First, that it is absurd and self-contradictory to assert that laissez-faire or economic individualism could have injured personal liberty; and, second, that Berlin is really explicitly scuttling the very concept of negative liberty on behalf of concepts of positive power or wealth.

Berlin reaches the height (or depth) of this approach when he attacks negative liberty directly for having been

used to . . . arm the strong, the brutal, and the unscrupulous against the humane and the weak. . . . Freedom for the wolves has often meant death to the sheep. The bloodstained story of economic individualism and unrestrained capitalist competition does not . . . today need stressing.

The crucial fallacy of Berlin here is insistently to identify freedom and the free market economy with its oppositewith coercive aggression. Note his repeated use of such terms as arm, brutal, wolves and sheep, and bloodstained, all of which are applicable only to coercive aggression such as has been universally employed by the State. Also, he then identifies such aggression with its oppositethe peaceful and voluntary processes of free exchange in the market economy. Unrestrained economic individualism led, on the contrary, to peaceful and harmonious exchange, which benefitted most precisely the weak and the sheep; it is the latter who could not survive in the statist rule of the jungle, who reap the largest share of the benefits from the freely competitive economy. Even a slight acquaintance with economic science, and particularly with the Ricardian Law of Comparative Advantage, would have set Sir Isaiah straight on this vital point.

http://mises.org/rothbard/ethics/twentyseven.asp

By all means, read The Ethics of Liberty. It is the epitome of clear thinking and reason.

Rightwing libertarians claim that greens and social justice campaigners are closet communists trying to resurrect Soviet conceptions of positive freedom. In reality, the battle mostly consists of a clash between negative freedoms.

There is no such thing as a ‘right wing Libertarian’. Once you have read For a New Liberty you will understand why this is the case. Justice applies only to man, and not to groups of men. Man does not have rights in groups (gay rights, black rights, women’s rights etc) and so when the accusation of closet communist is bandied about, you can understand where it is coming from.

As Berlin noted: “No man’s activity is so completely private as never to obstruct the lives of others in any way. ‘Freedom for the pike is death for the minnows’.”

Man is not a fish, and only man has rights. This analogy is self evidently nonsense.

So, he argued, some people’s freedom must sometimes be curtailed “to secure the freedom of others”. In other words, your freedom to swing your fist ends where my nose begins. The negative freedom not to have our noses punched is the freedom that green and social justice campaigns, exemplified by the Occupy movement, exist to defend.

Another bad analogy. Swinging your fist to punch someone in the nose unprovoked is violent aggression. Swinging your fist for any other reason is entirely your business. If you hit someone in the nose by accident, this is not aggression, it is an accident. You can therefore punch someone in the nose without aggressing against them. Boxers do it every day for sport. A better way to put this would be to say that you should not deliberately and without provocation, punch people in the nose because doing so is an act of violence. Thinking clearly and cleanly about these matters is essential if you are to get to the bottom of them. If you start from the wrong initial premiss however, it is difficult if not impossible to arrive at the correct conclusion.

The Occupy Movement, by the admission of some of them who have managed to get on to television, does not know exactly what it wants. It has no leadership, no centrally organising body, and anyone who turns up there has an equal voice. There are many Libertarians at the Occupy gatherings, and so to attempt to co-opt that movement in this way is simply misleading.

Berlin also shows that freedom can intrude on other values, such as justice, equality or human happiness. “If the liberty of myself or my class or nation depends on the misery of a number of other human beings, the system which promotes this is unjust and immoral.” It follows that the state should impose legal restraints on freedoms that interfere with other people’s freedoms or on freedoms which conflict with justice and humanity.

Unbelievable. Happiness is subjective, not objective or measurable. The State is not required to dispense Justice. Equality is a trigger code word that Statists use to justify their fallacious ideas. When it is used in this way, it usually means you are reading the words of a man like George Monbiot.

“If the liberty of myself or my class or nation depends on the misery of a number of other human beings, the system which promotes this is unjust and immoral.” This line is self evidently fallacious. First of all, man by his nature, does not exist as classes of men. This is a one hundred percent artificial construct. Your liberty is a function of your ability to exist free of coercion. This has nothing to do with with the emotional condition of other people (misery). You have no right to coerce others, and so as long as you do not do so, other people’s misery is not of your creation, and you cannot be blamed for it, or held responsible for it (outside of any religious obligation).

Rothbard never makes wooly statements and unfounded declarations like this. That is why I always recommend his books and essays, because there is no bad thinking in them, no leaps that depend on common knowledge. Rothbard’s thinking is a seamless, solid platform that is irrefutable, complete and absolutely correct, exposing the fundamental particles of the true nature of human interaction. Once you read Rothbard, bad thinking of the type we see here, jumps off the page with its wrong-ness.

These conflicts of negative freedom were summarised in one of the greatest poems of the 19th century, which could be seen as the founding document of British environmentalism. In The Fallen Elm, John Clare describes the felling of the tree he loved, presumably by his landlord, that grew beside his home. “Self-interest saw thee stand in freedom’s ways / So thy old shadow must a tyrant be. / Thou’st heard the knave, abusing those in power, / Bawl freedom loud and then oppress the free.”

The landlord was exercising his freedom to cut the tree down. In doing so, he was intruding on Clare’s freedom to delight in the tree, whose existence enhanced his life. The landlord justifies this destruction by characterising the tree as an impediment to freedom his freedom, which he conflates with the general liberty of humankind.

I actually laughed out loud at this part.

Clare has no ‘freedom to delight’ in someone else’s property the landlord has an absolute right to cut down any tree on his property. If Mr. Clare wants trees, he should spend less time viewing the much admir’d trees of the Landlord, and work to secure his own property, whereupon he can have his own trees to rest under with his decedents.

Of course, if Mr. Clare is a French citizen he has no incentive to own property, because the French State declares that primogeniture is illegal and families cannot pass down property as they see fit. This forces the French Monsieur Clare to marvel at the trees owned by the State or other people, and it means that eventually all people will only be able to marvel at trees owned either by the State or by its cronies.

A small digression, but illustrative nonetheless. Property rights are the foundation of a free and prosperous society. It solves all the problems of the environment, and its beauty, and has many other side effects that are entirely beneficial.

Without the involvement of the state (which today might take the form of a tree preservation order) the powerful man could trample the pleasures of the powerless man.

On the other hand, the monarch is very good at preserving the land is it not? Richmond park is a beautiful example, with its deer, 500 year old trees and tranquil spaces. What does the State do to help Richmond Park? It builds tower blocks at its edge. Preservation orders are nothing more than theft, masquerading as an act for the ‘public good’.

But rightwing libertarians do not recognise this conflict. They speak, like Clare’s landlord, as if the same freedom affects everybody in the same way. They assert their freedom to pollute, exploit, even among the gun nuts to kill, as if these were fundamental human rights.

No one has the right to pollute, this is false, and no one asserts that they have the right to pollute. They can have a license from the State to pollute, but that is an entirely different thing.

When people agree to work for each other, this is not exploitation, it is a mutually agreed contract. If someone owns a tract of land and allows a mining company to mine it, this is not exploitation, it is trade.

No one who is sane and who owns guns owns them to kill. Self defence is not the same as murder, and you have a right to defend yourself. Period.

People like George Monbiot have a very confused (no wonder, look at the books he reads) idea of what rights are and where they come from. Without a proper understanding of rights, it is impossible to have a logical perspective on all of these matters, and logical thinking is essential if you are to solve any problem in logic and ethics.

They characterise any attempt to restrain them as tyranny. They refuse to see that there is a clash between the freedom of the pike and the freedom of the minnow.

The State controlling the money, movement, biology and property of man is nothing less than tyranny. The State and its many apologists have no right to control others, and the only way they can justify their inherently immoral stances is by invoking poetry. It simply will not wash.

Last week, on an internet radio channel called The Fifth Column, I debated climate change with Claire Fox of the Institute of Ideas, one of the rightwing libertarian groups that rose from the ashes of the Revolutionary Communist party. Fox is a feared interrogator on the BBC show The Moral Maze. Yet when I asked her a simple question “do you accept that some people’s freedoms intrude upon other people’s freedoms?” I saw an ideology shatter like a windscreen.

Monbiot needs a new prescription for his glasses… LOL!

I used the example of a Romanian lead-smelting plant I had visited in 2000, whose freedom to pollute is shortening the lives of its neighbours. Surely the plant should be regulated in order to enhance the negative freedoms freedom from pollution, freedom from poisoning of its neighbours? She tried several times to answer it, but nothing coherent emerged which would not send her crashing through the mirror of her philosophy.

No plant has the freedom to pollute; this is a plain straw man argument. In a Libertarian society, any lead smelting plant that poisoned a tree on someone else’s land, let alone a person, would be subject to a withering legal attack. Knowing this in advance, all lead smelters would move to the most remote and desolate places on the earth to avoid poisoning people and being hit by thousands of vigorous lawsuits.

In the land of the State however, pollution is openly permitted and merely limited to different degrees, so that businesses can deliver cheap lead ingots to industry. A lead smelting plant in the middle of nowhere that has to deliver its ingots thousands of miles before they are used would have to increase their prices dramatically. Once again, it is the State that is the problem, not industry. It is the State that permits, condones and promotes pollution. It is the State that shields the polluters. It is the State that disempowers the victims of environmental poisoning.

Environmentalists like George Monbiot fail to understand that Libertarianism, property rights and Statelessness provides them with a means to have an environment that is cleaner by orders of magnitude. It takes an insightful thinker who has read the right books to come to this conclusion however.

Modern libertarianism is the disguise adopted by those who wish to exploit without restraint. It pretends that only the state intrudes on our liberties. It ignores the role of banks, corporations and the rich in making us less free. It denies the need for the state to curb them in order to protect the freedoms of weaker people. This bastardised, one-eyed philosophy is a con trick, whose promoters attempt to wrongfoot justice by pitching it against liberty. By this means they have turned “freedom” into an instrument of oppression.

http://www.guardian.co.uk/commentisfree/2011/dec/19/bastardised-libertarianism-makes-freedom-oppression

Libertarianism is the philosophy that disempowers the exploiters who use the State to license their systematic destruction of the environment. Libertarians understand what the true nature of the State is. They understand what liberty is, where it comes from and how to define it.

Libertarians understand the true nature of money. They understand how banking works, what inflation is and where it comes from. They also understand how contracts work, and your right to enter into them on whatever terms are suitable to both parties. They understand what the word ‘free’ means as it applies to man. They understand this unambiguously, without contradictions or sleights of hand, sophistry, or doublespeak.

Libertarians understand the true nature of the State, its predatory nature, and the truth of its institutionalised theft and mass murder. Libertarians understand what weak people have the same rights as the strong and that the needs of the weak are best served by understanding, defining and protecting the rights of everyone, equally.

Libertarianism is not a bastard child. It is of a clean lineage that stretches from Frdric Bastiat to Murray Newton Rothbard to Ronald Ernest Paul to Llewellyn Harrison Rockwell. It is anything but cycloptic. It embraces everything and every possible situation where man must interact with man, and it approaches every possible scenario with the same rock solid set of irrefutable fundamental principles.

Libertarianism does not rely on deception or changing the meaning of words to suit its purpose or befuddle the reader, a perfect example of which is given to us on a plate when Monbiot says that people who promote Libertarianism pitch it against liberty. This statement is absurd on its face.

Freedom can never be an instrument of oppression, by definition, if you are not working from the bespoke dictionary of George Monbiot.

You do not have the freedom to pollute other people’s land or bodies, or to steal money or property from them. When you participate in these immoral acts you immediately cease to be exercising freedom. But you know this.

The meaning of words is important. When people misuse them deliberately, they do so in order to confuse and deceive their readers. If you cannot construct an argument against something without changing the meaning of words, you have a strong indication that your position is incorrect.

In this piece, George Monbiot has demonstrated that he knows absolutely nothing about Libertarianism, has not read any of its foundational texts and is simply using the word ‘Libertarian’ as a axle to spin his attacks on the villains that are polluting the environment.

As the Ron Paul presidential bid gains momentum, we can expect many more empty attacks like this to emerge, as writers who have never read a single libertarian work are forced to tackle his philosophical positions. What this will do is expose either their complete ignorance about what Libertarianism is, or their inherently violent Statist philosophies, or their complete lack of the ability to think clearly.

In which of those three categories would you place George Monbiot?

THX-1138 leaks out in Egypt

Saturday, December 17th, 2011

Save us from the lawyers and the luddites

Saturday, November 26th, 2011

John Matonis has a new and excellent post on his ‘Monetary Future’ blog.

In it, he logically goes through some of the issues surrounding Bitcoin. It is well worth reading.

One section however, spurred this BLOGDIAL post. It’s the part about Vili Lehdonvirta’s ideas on ‘virtual goods’…

[…]

I am worried that Bitcoin is a step too far as it leaves no possibility for even democratic governments to enforce their laws. This is a topic I would love to debate with the community and hear opposing views. I think the end result could be a better understanding for me, but also a better understanding for the Bitcoin community on how to live in harmony with democratic authority.

Absolutely astonishing. A ‘step too far’? Towards or away from what exactly? We do not want to live in harmony with democratic authority. Democratic authority, to us, is inherently illegitimate, evil, immoral and completely unjustifiable. There are people who are attracted to Bitcoin precisely because it is beyond the control of ‘democratic authority’. As for it being a step too far, we must bear in mind that no one is forcing anyone to use Bitcoin. You decide on your own to use it, and if it succeeds or fails, you take the benefit or profit or losses respectively. Violent Statists are of course, vehemently opposed to free trade, voluntary exchange and liberty. Bitcoin is to the Statist as sunrise is to Dracula.

Matonis chimes in with…

For the most part, I respect Vili Lehdonvirta’s academic work on virtual goods ownership, but he harbors confused thoughts on the broader acceptance of bitcoin through dilution of its most beneficial properties, because he mistakenly extends the notion of virtual goods legal recognition to virtual currency legal recognition.

Fascinating. The Statists from the legal profession class are described by Murray Rothbard in ‘For a New Liberty’ as follows:

We see clearly why the State needs the intellectuals; but why do the intellectuals need the State? Put simply, the intellectuals livelihood in the free market is generally none too secure; for the intellectual, like everyone else on the market, must depend on the values and choices of the masses of his fellow men, and it is characteristic of these masses that they are generally uninterested in intellectual concerns. The State, on the other hand, is willing to offer the intellectuals a warm, secure, and permanent berth in its apparatus, a secure income, and the panoply of prestige.

[…] since the early origins of the State, its rulers have always turned, as a necessary bolster to their rule, to an alliance with societys class of intellectuals. The masses do not create their own abstract ideas, or indeed think through these ideas independently; they follow passively the ideas adopted and promulgated by the body of intellectuals, who become the effective opinion moulders in society. And since it is precisely a moulding of opinion on behalf of the rulers that the State almost desperately needs, this forms a firm basis for the age-old alliance of the intellectuals and the ruling classes of the State. The alliance is based on a quid pro quo: on the one hand, the intellectuals spread among the masses the idea that the State and its rulers are wise, good, sometimes divine, and at the very least inevitable and better than any conceivable alternatives. In return for this panoply of ideology, the State incorporates the intellectuals as part of the ruling elite, granting them power, status, prestige, and material security. Furthermore, intellectuals are needed to staff the bureaucracy and to plan the economy and society.

[…]

In all societies, public opinion is determined by the intellectual classes, the opinion moulders of society. For most people neither originate nor disseminate ideas and concepts; on the contrary, they tend to adopt those ideas promulgated by the professional intellectual classes, the professional dealers in ideas. Now, throughout history, as we shall see further below, despots and ruling elites of States have had far more need of the services of intellectuals than have peaceful citizens in a free society.

[…]

For States have always needed opinion-moulding intellectuals to con the public into believing that its rule is wise, good, and inevitable; into believing that the emperor has clothes. Until the modern world, such intellectuals were inevitably churchmen (or witch doctors), the guardians of religion. It was a cozy alliance, this age-old partnership between Church and State; the Church informed its deluded charges that the king ruled by divine command and therefore must be obeyed; in return, the king funneled numerous tax revenues into the coffers of the Church. Hence, the great importance for the libertarian classical liberals of their success at separating Church and State.

For a New Liberty

The whole idea of ‘Digital Goods’ is a fallacy, created by Statist professionals in order to gain a foothold in the emerging digital economy that threatens to disrupt their authority and completely replace the old world economy in many areas, specifically the delivery of films, books and music, and now through Bitcoin, the process of moving money around the globe.

The fallacious notion of ‘Digital Goods’ is pyramided on the idea that copyright (an artificial concept of the State) is legitimate and logical. As is the case with copyright, the idea of Digital Goods conflates the correct idea of property rights in real-world physical goods with a false right in intangible pure information, which can be infinitely copied, transmitted and transformed without loss.

An idea can have a human originator, but once that idea is conveyed to another man, it resides in the mind of that man. The only way that you can prevent that second man, the receiver, from using this idea is to initiate force against him. On this basis alone copyright as a legitimate idea falls, since it violates the non aggression axiom. I will leave it to you to explore the rest of this idea at your leisure. I also strongly recommend that you read ‘Against Intellectual Monopoly‘.

Bitcoin is an extraordinary and important innovation. It is the first system where a ‘Digital Good’ cannot be double spent. That means Bitcoins can be duplicated perfectly an infinite number of times, but they cannot be spent more than one transaction at a time between two people.

Bitcoins retain all the qualities of information (near zero cost transmission, infinite transformability, infinite lossless replicability), but the Bitcoin ecosystem changes them into something that has some of the qualities of physical property, whilst retaining all of the advantages of pure information. You can actually own a Bitcoin secure in the knowledge that even though everyone can read your Bitcoin, make copies of it, and see it in the Block Chain, they cannot steal it from you and spend it. You can copy Bitcoins ad infinitum, but inside the system is the only place where they have value or more accurately, utility. Bitcoin is the first instance of a digital representation that has some of the scarcity properties of a physical good.

Interestingly, this idea if transposed onto a music file, picture or film, could not work to prevent people using (double spending) those things, because there is no inherent value in owning a digital copy of a music file, film or book.

Imagine that instead of digital signatures, the Bitcoin block chain was used to control signed MP3 files. You could then have an ecosystem where unique copies of tracks (unique in that they were digitally signed, could not be forged and ownership was verifiable) could circulate for payment. The problem with this is that in this scenario music has two uses, one when it is stored in a file, and another when it is played in a music player, as well as being a string of numbers stored somewhere. There is also the ‘problem’ of the intent of music creators being that the same music is available to many people all at once.

Bitcoins do not have any use other than to confirm that they are owned by someone. This is why they can be used to transmit money over the internet. A digression, but interesting nonetheless, because this is the sort of thinking the large media companies should be doing or paying to have done for them, if they want to survive in any form over the next decade.

Apart from the revolutionary and singular case of Bitcoin in the Bitcoin ecosystem, all digital representations of ideas have zero intrinsic value, because they can be copied at a cost that approaches zero. In fact, the more copies there are, the lower the cost of obtaining a copy becomes because there are more storage locations to get them from and the cost of your time to search for them decreases. On some level, the law industry understands this, as they put pressure on Google to remove search results that point to files they claim contain ‘intellectual property’ belonging to their clients.

Digital technology has changed the way the world handles information forever. Trying to superimpose the outmoded, ridiculous and erroneous 19th century ways of thinking about property and business on people living today is a fruitless and anti-human endeavour. What’s more, it does not make everyone more honest and make business more efficient. Look at the dispute resolution mechanisms in eBay and Amazon, and you get a glimpse of how the free market works to protect everyone and benefit everyone. The State does not poke its snotty nose into the dispute resolution systems of these online services and the vast majority of transactions happen without any problems, and where there are problems, they are resolved within the mechanisms of the services to everyone’s satisfaction.

Just as the buggy whip makers, the lake ice industry and all superseded industries were eliminated by progress, the notion that music, books and any work that can be digitised should remain scarce, by force, is an astonishingly evil idea. The difference in people today as compared to those living in the age of the horse and cart it seems, is that this generation of men is not sufficiently agile, and a subset of them is unwilling to pivot and change business models to deal with the new reality. This is probably due to the very rapid pace of change, and the fact that there appears to be no future whatsoever for the people in the business of hoarding and supplying scarce information distributed in physical containers. They are squeezing this model for every drop of blood they can get before it becomes untenable to ask for money in exchange for physical discs or files.

Ill informed and self interested cronies and Statists are trying to keep man in horses and carts when the internal combustion engine car is in the garage of every home. It simply doesn’t make any sense on any level, is immoral, and the only reason why they can get away with it is they have an agent with the monopoly of violence to back them up: the State. In absentia of this force, no one would listen to the Statists, the MPAA/RIAA, the luddites, the lawyers, the buggy whip manufacturers and the Statists. Since they offer nothing of value, they would simply be ignored.

I predict that there will come a time when none of these people are taken seriously, and they are ignored and sidelined. The world simply will not be held down to the level of Stone Age Man to suit the needs of a vanishingly small number of venal, violent and ignorant men and their blinkered apologists. The dispute resolution systems that are an emergent property of sites like Amazon and eBay will spread out into the real world, making the State and its proponents redundant. It would be a fascinating project to try and separate these arbitration services and generalise them so that the public could use them instead of the courts of the State.

The fact of the matter is that lawyers have no right to tell anyone how to voluntarily exchange goods and under what terms those goods are to be exchanged. Their role is to arbitrate in disputes where both parties agree to be subject to the rules of the arbitrator, and nothing more. Because the vast majority of humans can exchange without disputes, they must create conflict in this area to maintain their social status and incomes, with the help of the State. This is why lawyers support the fallacious idea of copyright, and why they want to extend this sickness to Bitcoin, and all areas online.

The Statists refuse to accept reality, or cannot understand it, or understand it and actively fight to control it with violence. Lawyers especially have the most to gain from keeping the immoral, illogical and absurd copyright laws in force.

Or do they?

The fact of the matter is that once copyright laws are removed from all statute books, the amount of work for lawyers will not decrease, but will in fact increase, as creative people adapt to the new business models.

For example, no one has the right to steal a physical disk from anyone. If a musical work is created and stored in a fixed medium, and the right to be the first to sell it is sold to someone, a person who steals that disc and releases what is stored on it could be held liable for the damage caused to both contracting parties.

A disc of an unreleased highly anticipated pre-sold masterpiece would have an agreed value that is set out in a contract, and a value in pre-sales. Once it is leaked by theft and no one will pay for it, losses have been imposed upon the creative party, since exclusivity has been broken by the thief. In this scenario, damages are not calculated by how many copies are in the wild but by the fact that a physical disc has been stolen, its contents leaked and sales potential has been destroyed through cancellations. This is of course, completely separate from a work that is released on a disc, sold to a person, and that person making a copy for whatever reason. This is entirely legitimate, for reasons laid out clearly in Against Intellectual Monopoly.

This scenario is the same as someone breaking into a jewellery store and stealing a diamond necklace. Once that necklace has been stolen, it cannot be sold to someone else. The scenario of a pre-release disc being stolen and released is even worse, because the irreplaceable, unique first use opportunity has been destroyed forever. This is the true nature of the damage and theft done to both parties by this sort of act; the value of such a theft can be estimated and a valid moral claim made against a thief. Once again, this has nothing to do with the subsequent copies made by people who got a hold of the data by whatever means.

I use the example of the theft of a necklace deliberately, because it is used by the copyright monopoly to justify everyone being forbidden from making copies of what they own. Note how I am separating the act of copying what you have legitimately purchased from the destruction of potential by an unauthorised pre-release of a stolen disc.

There are many other circumstances where fault can be placed in this scenario. For example, if one party fails to maintain security and this is the cause of the leak, someone is at fault and has to pay. This can be laid out explicitly in a contract. These byzantine details are the job of lawyers to sort out, set terms for and organise. It is for lawyers to define these agreements, fix the agreed penalties, pursue the wrong doers in case of a breach of information. This would be a huge amount of complex work, worth an enormous amount of money. Lawyers are major beneficiaries of a world without copyright.

Of course, once a suite of music or book or other information is released, it can be copied ad infinitum, but then the next thrill is the thing that is valuable, and the public has an insatiable appetite for the new; this is just one possible model for the creative to explore, and of course, since they are the creative, its up to them to think of new ways of approaching the market in a reality where every idea can be copied and can spread world-wide in a matter of hours, if you hit exactly the right note.

The ignorant, imagination-less Statists want to prevent this astonishing world of the super abundance business model from fully emerging. They are doing everything they can to wreck the exponential growth of tools, contracts and technology that will unarguably benefit the entire planet, for the sake of a handful of ignorant, comfortable, computer illiterates.

Unfortunately for them, the harder they push against the internet, the stronger it becomes. Every service they have tried to cripple has either resulted in that service strengthening or spawning new services. Bulletin Board Systems, IRC DCC channels, Napster, Gnutella, Bittorrent are all examples in chronological order of how software outpaces the luddites, and of course, that list excludes the peripheral discoveries like MP3 that fuel the creation of new services.

This is a battle that they cannot win and which they should not win, because they have no case or moral foundation whatsoever.

Read this article in Hungarian.

Police Undercover Snatch Squads and Agents Provocateurs

Wednesday, November 16th, 2011

The unintelligent, inexperienced and completely deluded students are out again in force, to be kettled, sheared, abused and used as fodder to provide the police with much needed overtime money.

What is interesting here is that we may be seeing the seed of the idea that all the video cameras that everyone has by default could be used for something useful, active and defensive, instead of just a child’s toy.

From BLOGDIAL, “The answer comes before the question” January 13th, 2009

Imagine this scenario. Someone somewhere sets up a Web 2.0 site that features photos of bad police and other officials, or those mysterious agent provocateurs that have been plaguing the useless demonstrations around the world. Imagine that the software behind this site (which could be connected to iPhoto 09) identifies all the bad people and exposes them to the public, nullifying all acts of political infiltration over night. Anyone setting up any sort of anti-state gathering or demonstration or action could, with a gauntlet of workers armed with iphones, vet every demonstrator as they turned up to weed out all the infiltrators, collaborators and provocateurs.

I guarantee you that this will happen, and not only that, but that someone is going to put into a copy of iPhoto 09, a huge archive of photos from demonstrations and political meetings going back decades to pick out the bad guys.

This explosion and convergence of technologies is a double edged sword, and since there are more of us than there are of them, it will be the case that all this technology and the networks that join them together will result in something totally unexpected; the tools may turn around and bite the state in the ass in an unexpected way. The very nature of networks says that this will happen; the population by virtue of its vast networked numbers can overpower any government in a scenario where the network is the power.

We are not powerless like the slaves in the Soviet Union were. We have fantastic tools, all of them free, right in our hands. Those tools, by the act of using them, change the game entirely, and the more the state pushes against the mass, the more dense and impenetrable it becomes.

This is a war that they cannot ever win.

http://irdial.com/blogdial/?p=1517

[…]

Now look at this video, uploaded to YouTube by noshockdoc on Nov 11, 2011:

If these people had any sense, they would have already set up this web service as I described in 2009.

Using Augmented Reality ID:

They could check each ‘protestor’ against the online database of Agent Provocateurs and police officers to make sure that they had not been infiltrated.

Of course, anyone who is that smart is not interested in demonstrating in the first place, but we will leave that aside for now.

The point is, these young and very foolish people are behaving as if it is 1960 and not the end of 2011. As I have said before, again and again, the age of demonstrations is over. The shape of them, how they play out, move, surge and flow is well understood. There can be no surprises with them. Nothing comes of them, no matter how large they are, as we saw with the StopWar demonstrations before the destruction of Iraq.

The problem these people have is that if they were intelligent enough to know this, they would not be demonstrating, and would be well on the way to formulating a strategy that would actually give them what they want. Their problem, clearly, is a toxic mix of a lack of intelligence and experience.

They do not know exactly what they hope to achieve with these acts, they have no discrete goals or deliverables, they have no means of creating a new strategy because they lack the mental capacity to formulate one; in other words, they are a completely lost cause.

One thing that is coming out of this is interesting however.

Because everyone has a camera at these demonstrations, it might come to pass that the light bulb switches on over the head of some computer science student as she realises that it should be possible to create what I describe in the post above.

There are literally dozens of cameras in this clip; surely someone somewhere must be thinking that there is a use that can be put to the footage to help weed out the provocateurs. Who knows?

What we can say with a high level of certainty is that these students are going to achieve nothing by marching in the street. Everything they are planning, even if it is not known about in advance by surveillance is easily counter-able because marching and demonstrating is a ‘dead tactic’ that the State has a perfect understanding of.

All of this is a complete distraction of course; even this very post has distracted me from doing something else productive. Unless by chance it spurs the creation of the system I have been writing about.

Once again, demonstrations are ‘Yellow Ribbon Thinking’:

http://irdial.com/blogdial/?p=1152

they divert energy from useful acts and thinking, and prevent or delay permanent solutions from emerging. You should not participate in them; instead, you should be working only on things that have discreet goals and that has metrics that you can measure directly so that you can know if you are being successful or not.

Why the quoted price of Bitcoin doesn’t matter

Monday, October 17th, 2011

Bitcoin is a very new technology, even though the concept that it brings to life is decades old. The double spending problem has been solved; this means that it is possible to use a digital certificate to stand in the place of money and be sure that no one else can spend that certificate other than you as long as you hold it. This is an unprecedented paradigm shift, the implications of which are not yet fully understood, and for which the tools do not yet exist to fully take advantage of this new idea.

This new technology requires some new thinking when it comes to developing businesses that are built upon it. In the same way that the pioneer providers of email did not correctly understand the service they were selling for many years, new and correct thinking about Bitcoin is needed, and will emerge, so that it reaches its full potential and becomes ubiquitous.

Hotmail used familiar technologies (the browser, email) to create a better way of accessing and delivering email; the idea of using an email client like Outlook Express has been superseded by web interfaces and email ‘in the cloud’ that provides many advantages over a dedicated client with your mail in your own local storage.

Bitcoin, which will transform the way you transfer money, needs to be understood on its own terms, and not as an online form of money. Thinking about Bitcoin as money is as absurd as thinking about email as another form of sending letters by post; one not only replaces the other but it profoundly changes the way people send and consume messages. It is not a simple substitution or one dimensional improvement of an existing idea or service.

As I have explained previously, Bitcoin is not money. Bitcoin is a protocol. If you treat it in this way, with the correct assumptions, you can start the process of putting Bitcoin in a proper context, allowing you to make rational suggestions about the sort of services that might be profitable based on it.

If Bitcoin is a protocol and not money, then setting up currency exchanges that mimic real world money, stock and commodity exchanges to trade in it doesn’t make any sense. You would not set up an email exchange to buy and sell email, and the same thing applies to Bitcoin.

Staying with this train of thought, when you type in an email on your Gmail account, you are inputting your ‘letter’. You press send, it goes through your ISP, over the internets, into the ISP of your recipient and then it is outputted on your recipient’s machine. The same is true of Bitcoin; you input money on one end through a service and then send the Bitcoin to your recipient, without an intermediary to handle the transfer. Once Bitcoin does its job of moving your value across the globe to its recipient it needs to be ‘read out’, i.e. turned back into money, in the same way that your letter is displayed to its recipient in an email.

In the email scenario, once the transfer happens and the email you have received conveys its information to you, it has no use other than to be a record of the information that was sent (accounting), and you archive that information. Bitcoin does this accounting in the block chain for you, and a good service built on it will store extended transaction details for you locally, but what you need to have as the recipient of Bitcoin is money or goods not Bitcoin itself.

Bitcoin’s true nature is as an instant way to transmit money anywhere in the world. It is not an investment, or money itself, and holding on to it in the hopes that it will become valuable is like holding on to an email or a PDF in the hopes it will be come valuable in the future; it doesn’t make any sense.

Despite the fact that you cannot double spend them and each one is unique, Bitcoins have no inherent value, unlike a book or any physical object. They cannot appreciate in value. Mistaken thinking about Bitcoin has spread because it behaves like money, due to the fact it cannot be double spent. This fact however has masked Bitcoin’s dual nature of being digital, duplicable and not double spendable.

Bitcoin is digital, with all the qualities of information that make information non scarce. It sits in a new place that oscillates between the goods of the physical world and the infinitely abundant digital world of information, belonging exclusively to the digital world but having the characteristics of both. This is why it has been widely misunderstood and why a new approach is needed to design businesses around it.

All of this goes some way to explain why the price of buying Bitcoins at the exchanges doesn’t matter. If the cost of buying a Bitcoin goes to 1 This does not change the amount of money that comes out at the other end of a transfer. As long as you redeem your Bitcoins immediately after the transfer into either goods or currency, the same value comes out at the other end no matter what you paid for the Bitcoins when you started the process.

Think about it this way. Let us suppose that you want to send a long text file to another person. You can either send it as it is, or you can compress it with zip. The size of a document file when it is zipped can be up to 87% smaller than the original. When we transpose this idea to Bitcoin, the compression ratio is the price of Bitcoin at an exchange. If a Bitcoin is $100, and you want to buy something from someone in India for $100 you need to buy 1 Bitcoin to get that $100 to india. If the price of Bitcoin is 1 then you need 10,000 Bitcoins to send $100 dollars to India. These would be expressed as compression ratios of 1:1 and 10,000:1 respectively.

The same $100 value is sent to India, wether you use 10,000 or 1 Bitcoin. The price of Bitcoins is irrelevant to the value that is being transmitted, in the same way that zip files do not ‘care’ what is inside them; Bitcoin and zip are dumb protocols that do a job.

As long as the value of Bitcoins does not go to zero, it will have the same utility as if the value were very ‘high’.

Bearing all of this in mind, its clear that new services to facilitate the rapid, frictionless conversion into and out of Bitcoin are needed to allow it to function in a manner that is true to its nature.

The current business models of exchanges are not addressing Bitcoin’s nature correctly. They are using the Twentieth Century model of stock, commodity and currency exchanges and superimposing this onto Bitcoin. Interfacing with these exchanges is non-trivial, and for the ordinary user a daunting prospect. In some cases, you have to wait up to seven days to receive a transfer of your fiat currency after it has been cashed out of your account from Bitcoins. Whilst this is not a fault of the exchanges, it represents a very real impediment to Bitcoin acting in its nature and providing its complete value.

Imagine this; you receive an email from across the world, and are notified of the fact by being displayed the subject line in your browser. You then apply to your ISP to have this email delivered to you, and you have to wait seven days for it to arrive in your physical mail box. The very idea is completely absurd, and yet, this is exactly what is happening with Bitcoin, for no technical reason whatsoever.

It is clear that there needs to be a re-think of the services that are growing around Bitcoin, along with a re-think of what the true nature of Bitcoin is. Rethinking services is a normal part of entrepreneurialism and we should expect business models to fail and early entrants to fall by the wayside as the ceaseless iterations and pivoting progress.

Bearing all of this in mind, focussing on the price of Bitcoin at exchanges using a business model that is inappropriate for this technology simply is not rational; its like putting a methane breathing canary in a mine full of oxygen breathing humans as a detector. The bird dies even though nothing is wrong with the air; the miners rush to evacuate, leaving the exposed gold seams behind, thinking that they are all about to be wiped out, when all is actually fine.

Bitcoin, and the ideas behind it are here to stay. As the number of people downloading the client and using it increases, like Hotmail, it will eventually reach critical mass and then spread exponentially through the internet. When that happens, the correct business models will spontaneously emerge, as they will become obvious, in the same way that Hotmail, Gmail, Facebook, cellular phones and instant messaging seem like second nature.

In the future. I imagine that very few people will speculate on the value of Bitcoin, because even though that might be possible, and even profitable, there will be more money to be made in providing easy to use Bitcoin services that take full advantages of what Bitcoin is.

One thing is for sure; speed will be of the essence in any future Bitcoin business model. The startups that provide instant satisfaction on both ends of the transaction are the ones that are going to succeed. Even though the volatility of the price of Bitcoin is bound to stabilise, since it has no use in and of itself, getting back to money or goods instantly will be a sought after characteristic of any business built on Bitcoin.

The needs of Bitcoin businesses provide many challenges in terms of performance, security and new thinking. Out of these challenges will come new practices and software that we can only just imagine as they come over the horizon.

This article is available in Hungarian

US CENTCOM Strategy of Troll FAIL

Tuesday, October 4th, 2011

As the empire starts to crumble, and the talking heads in the MSM dwindle in influence, replaced by the likes of Alex Jones and Infowars, desperation methods are being rolled out to try and sabotage alternative and social networking media.

It will not work.

The problem they have is one of reputation, and six degrees of separation.

Because everyone is connected to everyone else by only six steps, it is now impossible to inject a lie into the hive mind of The Mass and have that lie survive scrutiny.

We have spoken about The Mass before on BLOGDIAL; it is the accurate prediction of the Twitter mediated hive mind that is impervious to the State and its lies.

Even if this vile attack on the truth through manipulation and lies was successful in any way, countermeasures can be built in software that would completely eradicate the influence of these glove puppet agents provocateurs.

Using the model of the PGP web of trust and the fact of six degrees of separation, it is possible to build a self organising, self healing global network of trusted introducers who can re-tweet only what is known to have not come from a glove puppet.

These trusted introducers and their messages would carry more weight than any glove puppet, and in fact, Twitter almost does this spontaneously through its simple method of people following each other and getting to know the sort of tweets that come out of the people they follow.

Anyone who uses these social networking tools understands that un-following is instant, adaptive network healing; if someone you follow says something that is a lie you either refute them by replying in public or un-following them and never again re tweeting their messages.

These simple actions are like the behaviour of antibodies fighting off infection, in this case, the infection of lies told by lying glove puppets.

These military people simply do not understand the world the are now living in. They cannot use their ridiculous twentieth century PSYOP strategies by ‘upgrading‘ them and superimposing them on Twitter; it simply will not transpose to these media.

What they must now realise is that lying as a strategy is finished. This would be the breakthrough that would put them on a strong footing for total domination of the social networking space. Sadly (or happily) they simply have not got a clue, nor the ethical foundation to make the correct strategic decision.

Lets do this!

The US military is developing software that will let it secretly manipulate social media sites by using fake online personas to influence internet conversations and spread pro-American propaganda.

They will fail.

A Californian corporation has been awarded a contract with United States Central Command (Centcom), which oversees US armed operations in the Middle East and Central Asia, to develop what is described as an “online persona management service” that will allow one US serviceman or woman to control up to 10 separate identities based all over the world.

Wait a minute, is it the US Military, or is it some snake-oil salesman in California who made a successful pitch?

The project has been likened by web experts to China’s attempts to control and restrict free speech on the internet.

This is utter nonsense, Grauniad style. Censorship has nothing to do with organised glove puppetry; everyone can continue saying whatever it is they like, unimpeded. Can these morons even define the words they are using? Shocking stupidity, and par for the course at the Grauniad!

Critics are likely to complain that it will allow the US military to create a false consensus in online conversations, crowd out unwelcome opinions and smother commentaries or reports that do not correspond with its own objectives.

Critics are nothing more than cry babies whining instead of writing software. As I say above, a web of trust can be built either spontaneously or with software designed to tamp down glove puppetry and MILCOMTROLLS. You can always spot trolls very easily, especially when they use templates or multiple identities to spam comments. The Telegraph comments sections are full of garbage; all you have to do to tune it out however, is to set Disqus to ‘best rated’.

The single act of people rating comments up (and not down, there is no downvote button) crowd-sources the bullshit out of sight. If an organised team of MILCOMTROLLS tries to hijack the comments, it is always the case that the best refuting comment outshines the glove puppetry, and the takeover backfires completely.

The people who put this contract out to tender have absolutely no idea how any of this works, and it is going to backfire on them spectacularly. Just ask Johan Hari about how Google can expose misdeeds in English. Any MILCOMTROLLS that try and poison threads or spin the hash tags will be spotted, outed and crowded out, reinforcing the exact opposite messages that they are trying to push.

The discovery that the US military is developing false online personalities known to users of social media as “sock puppets” could also encourage other governments, private companies and non-government organisations to do the same.

So what? Its just like other governments wanting nuclear weapons because the USA has them, or countries like India wanting ID Cards because most European countries have them.

The Centcom contract stipulates that each fake online persona must have a convincing background, history and supporting details, and that up to 50 US-based controllers should be able to operate false identities from their workstations “without fear of being discovered by sophisticated adversaries”.

This is unfeasible, and if it is feasible, the web of trust can isolate and expunge these glove puppets. Also, consider that when individuals write blog comments or send tweets, they think about what they are writing, instead of working from a script. The only way this MILCOMTROLL plan could possibly work is if they hired individuals to write from the MILCOM point of view, genuinely on a case by case basis, with the target articles distributed to them for attack.

You cannot create a fool proof system where one person can control ten identities and not be crowded out or discovered. Because each of these identities, credible or not, will all be propagating the same point of view, this fact alone would be enough to characterise, isolate, and quarantine them.

Centcom spokesman Commander Bill Speaks said: “The technology supports classified blogging activities on foreign-language websites to enable Centcom to counter violent extremist and enemy propaganda outside the US.”

Ron Paul 2021!

He said none of the interventions would be in English, as it would be unlawful to “address US audiences” with such technology, and any English-language use of social media by Centcom was always clearly attributed. The languages in which the interventions are conducted include Arabic, Farsi, Urdu and Pashto.

Its unlawful to glove puppet in English for American audiences, but its A-OK to ASSASSINATE Americans.

You cant make this stuff up.

Centcom said it was not targeting any US-based web sites, in English or any other language, and specifically said it was not targeting Facebook or Twitter.

Lies lies and more lies.

Once developed, the software could allow US service personnel, working around the clock in one location, to respond to emerging online conversations with any number of co-ordinated messages, blogposts, chatroom posts and other interventions. Details of the contract suggest this location would be MacDill air force base near Tampa, Florida, home of US Special Operations Command.

Once again, coordinated messages will be identified and neutralised. Think about this as a possible way of destroying the effectiveness of this dastardly plan.

Akismet is a distributed tool for eliminating spam. It is 99.99% effective. A system like that could be used to completely eliminate the occurrence of glove puppets and mass up/downvoters.

Since these people will be working in a coordinated way, their acts will be synchronised. It will be possible to identify them as a group and then systematically exclude them from showing up in comments or as up-votes. Digg has some experience in this, where massive groups of paid Diggers were organised to push stories onto the front page. Since these people all work together, it only takes a few instances of them working to simultaneously to generate a unique fingerprint of their behaviour, which can then be tested against when future MILCOMTROLL style attacks are initiated.

Of course, all this happens silently in the software, so like SEOs trying to game Google, they will meet with a very serious problem the instant they roll this programme out. Anyone working with Gmail knows that it is spam free. This proves that distributed, collaborative filtering and secret sauce software can work to keep out the bad guys.

Centcom’s contract requires for each controller the provision of one “virtual private server” located in the United States and others appearing to be outside the US to give the impression the fake personas are real people located in different parts of the world.

These people are not going to be posting in English. This is a big hurdle for the glove puppets who are going to be operating their MILCOMTROLL identities. Online credibility is not just a matter of getting an accurate word for word translation of an idea; there are cultural references, nuances and cues that the American military are notoriously and hopelessly bad at. Can you imagine some shorn headed operative in jungle camo, sitting in an air conditioned room in Tampa Florida, trying to pass herself off as a muslim man in Riyadh? Or ten different people in Riyadh?!

The whole idea is simply ridiculous, and in fact the targets of this rubbish will not need any special software to detect these MILCOMTROLLS, they will give themselves away when they post during prayers or some other stupid (and fatal) basic cultural error.

It also calls for “traffic mixing”, blending the persona controllers’ internet usage with the usage of people outside Centcom in a manner that must offer “excellent cover and powerful deniability”.

This is snake oil straight from the brochure. NO $ALE!

The multiple persona contract is thought to have been awarded as part of a programme called Operation Earnest Voice (OEV), which was first developed in Iraq as a psychological warfare weapon against the online presence of al-Qaida supporters and others ranged against coalition forces.

Ridiculous. There were no al-Qaida in Iraq before the Americans got there. This is pure and utter bullshit, and those with memories longer than goldfish know this. The war of blowing people to bits, and pictures of it, are worth many thousands of MILCOMTROLLS. You cannot win hearts and minds with a gun, or a drone. Period. This is a waste of time and a waste of money, and I strongly suspect that anyone who has been on a tour in Iraq will confirm this. The military are giving more money to Ron Paul; more than all the other candidates combined. This is not an accident; these people know what is really going on, and no amount of snake oil, lies, glove puppets or trolls can stop the truth from coming out.

Since then, OEV is reported to have expanded into a $200m programme and is thought to have been used against jihadists across Pakistan, Afghanistan and the Middle East.

And its not working, on a purely objective PR level, removing all aspects of right or wrong, who started what or anything other than the measure of mindshare. All you have to do is watch the propaganda that these people produce on LiveLeak. No troll, no commenter no one can counter the stark shock value of what these people are disseminating. They are winning the PR war because their PR is quantitatively better. Once again, this has nothing to do with what you personally think about them and their motives, its a pure matter of mathematical fact.

OEV is seen by senior US commanders as a vital counter-terrorism and counter-radicalisation programme. In evidence to the US Senate’s armed services committee last year, General David Petraeus, then commander of Centcom, described the operation as an effort to “counter extremist ideology and propaganda and to ensure that credible voices in the region are heard”. He said the US military’s objective was to be “first with the truth”.

The best counter-terrorism and counter-radicalisation programme would be to elect Ron Paul. It is a scientific fact that all terrorism against the USA would cease thirty days after Ron Paul was elected.

Do you think that that is a big claim to make? Very well, dont believe, me take it from someone, the only person in fact, who has done a 100% accurate study of the true nature of terrorism: Professor Robert Pape, in his lecture “Dying to Win”

In this lecture, he will prove to you with unassailable facts that if Ron Paul wins, terrorism goes away.

This month Petraeus’s successor, General James Mattis, told the same committee that OEV “supports all activities associated with degrading the enemy narrative, including web engagement and web-based product distribution capabilities”.

This is utter nonsense on stilts. The ‘enemies narrative’ as outlined by Dr. Pape is that America is occupying other people’s countries. That is the ONLY narrative, and no amount of glove puppetry can alter this fact. Only a complete removal of American forces from foreign lands can change the narrative and end the nightmare.

[…]

Finally, we get to the ‘me too’ part of the article:

It is unclear whether a persona management programme would contravene UK law. Legal experts say it could fall foul of the Forgery and Counterfeiting Act 1981, which states that “a person is guilty of forgery if he makes a false instrument, with the intention that he or another shall use it to induce somebody to accept it as genuine, and by reason of so accepting it to do or not to do some act to his own or any other person’s prejudice”. However, this would apply only if a website or social network could be shown to have suffered “prejudice” as a result.

Is an online identity, a nom de plume a ‘false instrument’? Any website that takes comments from anyone using any name has entered into a contract where such an act is acceptable, and so de-facto, the Forgery and Counterfeiting Act 1981 could not apply. The fact is that UK law is not anywhere near being relevant to glove puppetry and where they apply existing law, they nearly always get it horribly wrong, like the recent case of the autistic Troll imprisoned for… trolling.

Trolling is a simple matter of freedom of speech (property rights). The people who own the servers are publishing on their own property. They enter into contracts with people who leave comments. It is as simple as that. There is no space in that contract and interaction for the State to interject itself.

This article was amended on 18 March 2011 to remove references to Facebook and Twitter, introduced during the editing process, and to add a comment from Centcom, received after publication, that it is not targeting those sites.

[…]

http://www.guardian.co.uk/technology/2011/mar/17/us-spy-operation-social-networks

Yeah, bullshit.

This is so full of fail there is fail spilled all over the floor.

The people who are least susceptible to MILCOMTROLL propaganda are the targets of this insane scheme. They are not going to buy any of this, and any attempt to spin the Twittersphere or blogosphere in English, in the USUK, as they are no doubt trying to do right now, is doomed to failure.

The mass rejects their malignant attempts at influence at every step, and as the economy continues to degrade, all calls to ignore the Federal Reserve, wage more wars, re-elect mobsters and murderers is going to ring so hollow that the sounds will resemble the biggest bell ever cast.

Crony Capitalists deploy glove puppet schizophrenic luddite

Tuesday, September 13th, 2011

The crony capitalist copyright monopoly has rolled out its latest delusional computer illiterate schizophrenic luddite, Jeremy Hunt, to try and cripple the internets.

First things first.

Culture does not need a secretary. The idea that the State should have a position to ‘have a say’ in matters to do with culture is absurd on its face. Art galleries, artists, authors, music makers, sculptors and anyone involved in culture in any way do not need to be overseen, managed, given ‘guidance’ or ‘represented’ by a ministry. Only States like the USSR have traditionally had such corrosive, totalitarian and frankly, disgusting posts. Actually, France has a Minister of Rock & Roll, but France doesn’t count.

Even if you accept that the State should have a ‘Culture Secretary’ the internet is a technical brief, not a cultural one. No doubt there are moves afoot to create a new ‘Secretary for Digital’. The State should not be able to produce these new positions willy nilly, since they are public servants.

OK, Lets do this.

Google should join fight on piracy, says Jeremy Hunt

Culture secretary calls on advertisers and search engines to make life more difficult for those that ignore copyright laws.

What a disgusting, irrational and ridiculous call; to ‘make life more difficult’ for people. The internet exists to make life easier. What Jeremy Hunt is calling for is to cripple the internet, to make service providers divert capital away from improving their services into something that no one but a tiny group of venal beasts want. This is not the call of a human being, this is a call from a monster that wants to destroy progress, inhibit the utility of the greatest invention since fire, and to harm millions of people all over the world. Absolutely repulsive.

Jeremy Hunt, the Secretary of State for Culture, Media and Sport, is to tell Google and other search engines that they should play a greater role in the fight against online piracy. Mr Hunt will ask them to make life more difficult for pirates.

And they are all going to tell him, politely, to go straight to hell. Jeremy Hunt is in good company; he is spouting the same garbage that Andy Burnham used to on this matter.

Copying music is not piracy. It is not theft. The BBC even said so, in a grovelling apology after they aired a scandalous, unforgivable, stupid, retarded and evil attack on Bittorrent and were taken to task for it:

First though, an apology. File sharing is not theft. It has never been theft. Anyone who says it is theft is wrong and has unthinkingly absorbed too many Recording Industry Association of America press releases. We know that script line was wrong. It was a mistake. Were very, very sorry.

If copyright infringement was theft then Id be in jail every time I accidentally used football pix on Newsnight without putting Pictures from Sky Sport in the top left corner of the screen. And Im not. So it isnt.

No where near enough of an apology, but as far as the BBC goes, this is grovelling, first class.

He is expected to tell the Royal Television Societys Cambridge Convention that reasonable steps will make a significant difference, and also make the suggestion that if the industry does not help the Government it will legislate via the new Communication Bill. We intend to take measures to make it more and more difficult to access sites that deliberately facilitate infringement, misleading consumers and depriving creators of a fair reward for their creativity, Mr Hunt will say.

The world is changing. The number of people who know about crony capitalism, the abuses of the RIAA/MPAA and the rest is growing exponentially. Even the scumbag lying State shills at the BBC say that people like Hunt, “..(are) wrong and (have) unthinkingly absorbed too many Recording Industry Association of America press releases”.

Jeremy Hunt is on the wrong side of history, and he hasn’t got the brains to know it. If he does know that what he is saying is unfounded, illogical codswallop, then he is a coward for not stating the plain truth, which is that the internet has changed the way people consume media, these changes are benefits which will bring prosperity to everyone, and the old business models are dead as the Dodo.

The Government wants search engines to penalise website whose content is ruled unlawful. Less prominent results would have a direct effect on revenues from advertisers as well as sales.

If you removed all the links to any torrent site or site that provides links to other sites, what would happen is that someone would write an application that will absorb and re-distribute all those searches. It would spur the creation of a one stop place to find everything you need, and it could be designed in such a way that it can not be shut down. It would make the distribution of links more efficient, and this would mean more file sharing.

The internet sees Jeremy Hunt and his luddite ideas as damage and routes around him and them. Anything that is done to stop people communicating will cause more robust systems to be developed and deployed to bolster communication. We have seen this again and again. Napster was shut down and that caused gnutella to be developed. Then, the Bittorent protocol was developed as a direct answer to the problem of hosting files on central repositories. The same thing can be done with links. A distributed search engine, unstoppable, with no central point of attack will up the stakes and Jeremy Hunt would be the one that caused it to come into being. That is what is called an ‘own goal’ in the UK.

Mr Hunt will argue that online businesses deserve the same legal protection as physical ones. We do not allow certain products to be sold in the shops on the high street, nor do we allow shops to be set up purely to sell counterfeited products. Neither should we tolerate it online, he is set to say.

This is a fallacious, straw man argument. Physical goods are not the same as information and it comes right out of the MPAA script. When you copy a file or an idea, nothing is lost, and more to the point, Google does not facilitate copying, it merely points to resources that may or may not ‘infringe copyright’. There is no reason whatsoever to call upon business to take proactive measures against links that potentially point to items that are not even criminal in the first place.

He will add, however, The government has no business protecting old models or helping industries that have failed to move with the times. But those new models will never be able to prosper if they have to compete with free alternatives based on the illegal distribution of copyrighted material.

This is double talk. Government is protecting the old business models by insisting that there is such a thing as copyright. It is helping industries that have failed to move with the times, explicitly, the music and film industry. Secondly, Hunt says ‘free alternatives’ are bad; what if the new business model is the free model?. By saying that free is not acceptable, Hunt is picking winners, helping the dinosaur media and failing to move with the times. It is not the place of Jeremy Hunt or any public servant to determine which business models are and are not appropriate. Jeremy Hunt is talking nonsense on stilts.

Despite campaigns from internet freedom activists, the high court ruled in July, after a lengthy process, that the internet service provider BT should block a website that flagrantly infringed copyright, called Newzbin. Although the Internet Watch Foundation is able to use a sped-up legal process, it currently can only do so for sites relating to illegal online pornography. Google, however, claims that takedown requests from reliable copyright holders are dealt with in four hours. The government moving its pressure from ISPs to search engines marks a new approach to its multi-faceted attack on digital piracy.

http://www.telegraph.co.uk/technology/google/8759414/Google-should-join-fight-on-piracy-says-Jeremy-Hunt.html

They will fail.

Since the advent of modems running at 14.4k people have been sharing files, and it has grown year on year without fail every year. The mainstream media and the copyright monopoly have lost both the war and the argument. The movie studios still pull in hundreds of millions for their blockbusters, and so the much reported death of their industry has not materialised, as it never does whenever they whine that a new technology is going to wipe them out.

It is nothing short of absurd that Jeremy Hunt and his cohorts want to turn Britain into a leader of all things internets, but in the same breath, they do everything they can to cripple the companies that work with it. You cant have it both ways; either you want your East End Fantasy to take root or you do not. If you do, get out of the way, and let business flourish. If you do not, carry on as you are, making these ridiculous paid promotions for the copyright monopolists and watch everyone write you off as a potential place to locate.

In the past, anyone thinking about writing an innovative service, like a CD Ripping service, would have run a mile from the UK. Only now, as the CD is dying as a format will it become legal for a company like this to set up… or will it? Who knows? What is for sure is that if you plan on starting an internet business in the UK, you are taking a huge risk that Jeremy Hunt & Co. are going to suddenly, at the behest of your competitors, put you out of business either by directly legislating against you, or scaring investors away by giving a speech.

One thing is for certain; the tide is turning against Jeremy Hunt and all the glove puppets who sound suspiciously similar. What do I mean by that? Hmmmm, Which one is Jeremy Hunt, and which one is Andy Burnham? can you tell?:

Hunt or Burnham?:
“We must ensure that copyright delivers maximum benefit to performers and musicians. That’s the test of any model as we go forward”

Hunt or Burnham?:
“Let me be absolutely clear so there are no misconceptions about where the Government is on this. We share a real support for artists and musicians.”

Hunt or Burnham?:
“Music has been hit hard over the last ten years, and if we dont do something there is a real danger that parts of the music industry will be washed away.”

Hunt or Burnham?:
“Developments in communications have changed the music world and I think we are now at a time that calls for partnership between Government and the music business as a whole: one with rewards for both of us; one with rewards for society as a whole.”

Hunt or Burnham?:
“My job Governments job is to preserve the value in the system.”

Hunt or Burnham?:
“What do we need to do to help our businesses grow and evolve between now and 2025? Where can regulation help and where is it a barrier? What can we do collectively to enhance the whole UK market?”

Hunt or Burnham?:
“We have an extraordinarily strong and diverse media landscape in this country, combined with a remarkable wealth of talent in our creative industries.”

They are indistinguishable are they not?

Honestly, I dont care about what these people think; the only thing that matters is that they have the guns. As long as they have the monopoly on violence, they will be able to distort, destroy, corrupt and damage. If they did not have the monopoly on violence, Jeremy Hunt might be a school teacher somewhere, harmless, quiet and of no concern to anyone.

Thankfully, the market, the internet, and the people on it are more powerful than Jeremy Hunt. No matter what he says, no matter what he asks for, and no matter who he can bully into obeying his luddite wet dreams, the internet and the market will route around him and his disease and the spice will flow!

Precursors to Bitcoin legislation emerge

Friday, September 2nd, 2011

It is clear that the State is not going to quietly disappear into the night, and leave everyone to live as free men. Given that they still feel the need to preserve the illusion that they have the consent of the governed, we can expect any technology that threatens the State to come under legislative attack, after a carefully orchestrated series of media smears, hysterical news articles, straw man attacks and ‘real world’ examples of harm where Bitcoin is presented as an enabling factor.

Bitcoin has the potential to severely disrupt the ability of the State to steal money from people. Bitcoin is being built by developers who want to preserve the privacy and security of its users. If Bitcoin and systems like it become wildly popular, as popular as the internet itself, then this will mean that financial transactions will ‘go dark’ and the state will not be able to intercept, detect or steal money from citizens.

Email communications are routinely monitored by the state, both covertly and overtly. This eavesdropping could be stopped completely if the users of email encrypted their communications. The tools to do this are free and simple to use, and yet, mass adoption of encryption for email has not take off after over a decade of availability. Had encryption been built into email from its inception, privacy would have been the default for email.

The development of Bitcoin is being done with privacy in mind from the beginning. In order to make a Bitcoin transaction, a user must accept that her transactions have privacy features built in by default.

The mistakes and built in disadvantages and myriad security problems of email are not going to be repeated with Bitcoin, and if Bitcoin becomes as ubiquitous as email it will represent a significant step towards liberty for all people world-wide.

When the State is perturbed by new technological developments and sees them as a direct threat, they build a case for legislation either through a crisis, real or fabricated, or through an academic attack from its intellectual class.

The recently published paper, ‘Shadowy Figures: Tracking Illicit Financial Transactions in the Murky World of Digital Currencies, PeertoPeer Networks, and Mobile Device Payments’ by John Villasenor Cody Monk and Christopher Bronk is an example of an academic attack of this type:

http://www.bakerinstitute.org/publications/ITP-pub-FinancialTransactions-082911.pdf

The paper works from the premiss that the State has rights, that it has a right to control and steal from individuals, it has the sole right to define what money is and is not through its legal tender laws and that it also has the right to forbid people from transacting in anything other than the currency it issues.

In short, it works from a position that takes the State and its power as a given. It is an excrescence of members of the class of “opinion moulders” in society as described by Murray Rothbard; men who’s alliance with the State is based on a quid pro quo, where in return for spreading and reinforcing the idea among the masses that the State and its rulers are wise, good, sometimes divine, and at the very least inevitable, with no conceivable alternatives, the State incorporates the intellectuals as part of the ruling elite, granting them power, status, prestige, and material security.

Lets begin with the executive summary:

Almost no one would argue that governments do not have a right to track and trace digital financial transactions associated with activities such as terrorism and human trafficking. It is less clear, however, how governments can surmount the formidable technical and organizational challenges associated with detecting and monitoring these transactions. The solution will require a combination of self-regulation, government-industry collaboration, and change in both technology and culture within government agencies.

Actually, there are many people who argue that not only does the state have no right to track and trace digital financial transactions, but that the state does not have any rights at all. Only man has rights. The State (under the American system of government) has powers that are delegated to it by the people through a carefully crafted Constitution, enumerating and limiting those powers.

Using the standard fear-mongering terms of terrorism and human trafficking in relation to this gives you a foretaste of what is to come in this shabby publication. The State uses terrorism as a pretext to surveil everyone’s transactions, en masse, not just those of terrorists, who are now defined as essentially anyone who breathes air. This is the only explanation for the millions of Americans who are listed on the State’s despicable ‘No Fly List’, whose explicit purpose is to prevent acts of terrorism.

This is also the pretext they are using as they are pulling off the pants of wheelchair bound 97 year olds at airports, looking for bombs in the diapers of infants and requiring banks to report on all transactions over arbitrary limits. No one who is in full possession of the facts of State surveillance under the guise of prevention of terrorism believes this line any more. These measures are solely and demonstrably designed for the control of the ordinary citizen.

Human trafficking is another straw man argument; anyone who is trafficking in human beings will quite sensibly be using cash to receive or make payments. This is the same bogus argument put forward when attempts were made to regulate cryptography in the 1990s; it was claimed that terrorists were using Steganograpy to hide messages in images. It was a completely false Hollywood movie plot of course, and the idea that human traffickers would take an electronic payment rather than large Euro notes or One Hundred Dollar bills is patently absurd. Once again, anyone who thinks even casually about this comes to the conclusion that these arguments for the legislation and control of digital money are weak at best.

This paper is littered with fallacious arguments:

While there is a wide spectrum of views regarding the right to digital privacy, almost no one disputes the notion that the right to digital financial privacy does not extend to providing an impenetrable legal shield for the online financial activities of terrorist groups, human traffickers, or drug cartels.

Once again, there are many people who argue that prohibition is immoral, and that the entire ‘War on Drugs’ is a fiasco and a disaster on every level.

To say, “almost no one disputes the notion that the right to digital financial privacy”, is a pure example of the appeal to belief fallacy. Just because many people believe something, you cannot infer that their beliefs are correct or that an act based upon them is justified.

The State is most certainly not justified in surveilling everyone’s transactions to intercept money and goods that do not involve crimes where there is a victim. The matter of prohibition is a perfect example of this.

Hawala and other informal value transfer systems long predate the advent of computers and the Internet, and, in more recent years, have been of concern to authorities because of their potential to be used for money laundering and terror financing

I will not address every instance of the straw man of terrorism or human trafficking in this publication.

Money laundering is a euphemism for transactions out of view of State surveillance. Any transaction that takes place outside of State control is essentially ‘Money Laundering’ according to the State. This means that, for example, people living in Greece, who are forbidden from making any transaction over 1500 in cash, even though the money is legitimately theirs and they are not engaging in any act that is defined as criminal activity by the State, is guilty of ‘Money Laundering’ by the mere fact that they are making a transaction above an arbitrary size.

What the authors of this paper are suggesting is that digital money systems, by virtue of their built in privacy mechanisms are de-facto money laundering systems because they deny the State the ability to surveil them. This is classic State reasoning, Kafkaesque and irrational, of the kind that is used to justify every predation and immoral piece of legislation that the State cares to write, from the laws prohibiting you from growing certain species of plant, to eminent domain, the innumerable different licenses, regulations and compulsions of all kinds and beyond.

tracing a specific suspect transaction that is intentionally buried in the noise can be like trying to find a pickpocket who just stole a wallet in a crowded market. The knowledge that the pickpocket is certainly among the hundreds of people within view is of little comfort if there is no practical ability to search every person in the market.

Its interesting that the authors use the analogy of a pickpocket when describing the act of a citizen making a transaction of their own money to another person over an anonymous network. It is the State of course, that is the pickpocket and thief, not the citizen minding her own business and transacting voluntarily and in private.

In l996, physician Douglas Johnson started spending his evenings writing software to create e-gold, a new digital currency that, though not issued by any government, would be fully backed by gold stored at various locations around the world. By 2001, there were nearly 300,000 e-gold customer accounts with an aggregate value of about $16 million.4

Anyone who does not believe that the State is building a case to come after Bitcoin is deceiving themselves. They are already using the one size fits all pretext of terrorism to shut down minters of physical coins like the Liberty Dollar and this case along with the case of e-gold should be of interest to people who use Bitcoin. E-gold had assets worth 16 million dollars, and:

“Liberty Dollar coins and precious metals, currently valued at nearly $7 million.”

Bitcoin is worth 10 times the amount NotHaus’s gold was worth, so I’m sure it is receiving 10 times the destructive attention from our glorious overlords.

[…]

Libertarian News

Bitcoin is bigger in dollar value than both e-gold and Liberty Dollar combined, and it is decentralised with no single company controlling it, unlike the e-gold and Liberty Dollar services. This academic paper is, I am quite sure, a direct result of this fact, and the fear that Bitcoin is sure to continue to grow in strength in every respect. This paper will be distributed widely among the State actors who will seek to understand Bitcoin within a framework of their own thinking and ideology.

You can expect that every trick in the book is going to be used to retard the growth of Bitcoin. You will see smears thrown at it that will include terrorism, human trafficking, and drug dealing (as we have already seen in this paper) but also expect child porn and paedophillia to be used to taint these systems. For those who are not persuaded by hysteria, the financial news networks are busy telling their viewers that Bitcoin is to be avoided at all costs. None of these attacks are logical or rational of course.

While e-gold was backed by actual gold, Bitcoin is fully virtual, backed only by the confidence of the people who use it for transactions. A governmental entity attempting to shut down Bitcoin servers in its territory would almost certainly find that even more servers would spring up, Hydra-like, in other parts of the world. As of July 23, 2011, there were approximately 6.9 million Bitcoins trading at a value of more than $13 per Bitcoin, corresponding to a total supply of over $90 million.11

And here we have another problem which this paper does not address; Bitcoin is not money. This will be the first counter argument tilted against any attack by the State against a high profile company that trades in Bitcoins. E-Gold and Liberty Dollars had one thing in common; they both traded in objects that are demonstrably money, and which are in fact, better money than the Federal Reserve Notes that are legal tender in the United States.

Bitcoin is different in that it is not money, but is a protocol, like TCP/IP. I predict that this will be a successful argument, because if it falls, then the financial regulators will be given the power to regulate the resale of any good or service for which a token or recipt is issued simply because money is exchanged for goods and services.

If the State was staffed by actors who were rational, they would not be attacking these services; they would immediately accept them all as payment for taxes. In this way, they would ensure that whatever happens and whatever systems come to pass, they will have a stake in them and a stream of revenue. By trying to stamp out digital currencies, refusing to accept them and trying to force people to use their worthless and inflating fiat currencies, they will end up being starved of cash as people switch from bad currencies issued by central banks to digital money transfer systems.

The potential Achilles heel of Bitcointhat each server in the network contains a complete record of all transactionswill almost certainly be addressed in future systems that distribute transaction information so that no single server or small collection of servers contains a complete transaction record. It is also possible to envision systems in which the transaction records are not only distributed, but evanescent, so that even the collective information stored on all the servers in the system at any given time would not enable a complete reconstruction of transaction history.

This is essentially what we have been saying; Bitcoin as a brand may or may not not succeed, but for certain if it does not, an improved successor in a following iteration is bound to be created. Solid Coin is one of the first challengers in this respect. They claim that their client software and network, which are a fork of the open source Bitcoin source code, is superior to Bitcoin and are not afraid to trumpet this claim.

For individuals using any digital system properly, the loss of a small working balance is not a deal breaker. When a digital money transfer network collapses and a new replacement network emerges, whatever fiat or non fiat currency you have to hand and wish to transmit can be sent through the new system. The companies that facilitate exchanges could be wiped out, but they will quickly be replaced by successors since some of the software suites used to run exchanges are open source software. This means that the digital money economy can survive multiple crashes no matter what the causes of those crashes are. The need for people to transact at a distance with very low fees is so great that it will never be possible to get rid of this idea, no matter what the inconvenience of a crash means in terms of short term losses.

It is statistically inevitable that some fraction of the more than 300 million transactions performed using M-PESA in 2010, and of the much larger number of transactions that will be performed in 2011 and future years, will not be legitimate. And some fraction of those, in turn, may involve payments that bear on American national security or law enforcement concerns.

The paper goes on to describe M-PESA and its spectacular growth, and then claim that a small fraction of the 300 million transactions performed in that system will be ‘of concern’ to American national security or law enforcement.

This is not the problem of anyone in the world other than the U.S. Government, and if Ron Paul becomes president, it will no longer be the concern of the U.S. Government.

We must remember when we read these words that the phrase ‘law enforcement concerns’ means prohibition and the bogus ‘war on terror’ both of which are entirely illegitimate. In absentia of these two rationale, there is no concern of any kind when we talk about what the un-banked are doing in the middle of what most Americans would consider to be “nowhere”. These are artificially created problems looking for solutions, and they should be rejected by all right thinking people on principle.

And, the 2008 financial crisis illustrated that the economic picture constructed by the organs of the U.S. government tasked with financial and commercial measurement, oversight, and regulation can have significant blind spots. These examples illustrate that the barriers to observing financial activity can be organizational as well as technological. Accordingly, successfully addressing the complexities of illicit financial transactions in cyberspace will require structural and technological steps taken by regulatory, intelligence, and law enforcement agencies, as well as the private sector.

This is of course, completely ridiculous. The causes of the 2008 financial crisis were and are well understood by students of the Austrian School of Economics, and were predicted, repeatedly on television. There were no ‘blind spots’ save in the eyes of the Keynesians and the slavish apologists for the Federal Reserve. Note also, how apologists for the State use the prefix ‘cyber’ when they are talking about things on the Internet they do not like and ‘digital’ when they are describing things they perceive as beneficial.

The economic pictures constructed by organs of the U.S. Government are nothing more than fairy tales. Take for instance the way that unemployment is measured. It is a fact that the way the counting is done has been deliberately manipulated to massage the numbers downwards. The website Shadow Stats specialises in presenting honest data rather than the skewed numbers generated by political needs of the State.

To claim that digital currencies make calculation difficult for government is absurd. If calculation is so critical for the State, they should force the Federal Reserve to publish ‘M3’, the number that describes the money supply, and they would not use statistics to lie about the true state of the economy. All of this is, of course, separate from the fact that the State has no legitimate purpose in generating these numbers and using them to engineer society in the first place.

The private sector has no interest in crippling their products so that the state can gain back door access to them and their customer’s data. Burdening them with these proposals is anti-business, anti-progress and anti-liberty and is illegitimate.

In addition to fostering self-regulation within the various industry sectors involved in the movement of money, the U.S. government should establish an interagency government/industry working group or expand the charter of an existing group to focus specifically on emerging financial threats.

These measures will not work to ameliorate the artificial problem of ‘financial threats’. Since all of the software, both in terms of clients, servers and exchanges are open source, any attempt to poison a digital currency will immediately cause a fork. Solid Coin is a perfect example of this; they have forked Bitcoin in advance of any threat from the State, based solely on the casually spoken words of Gavin Andressen at the first Bitcoin conference.

Should any involvement by law enforcement actually be confirmed, or the Bitcoin source go closed, Solid Coin will gain tremendous momentum. Digital currency sees the State as damage and routes around it, to re-purpose a venerable phrase. Like a physicist trying to know the location and energy of a quantum particle at the same time, any attempt to touch these systems will be self defeating.

Another set of relatively low-tech but still useful solutions pertains to systems that can monitor the premises where MMT agents conduct business. Digital image and video recording is now routinely used in venues as diverse as banks, stores, and taxis. A properly designed system could aim to ensure that cash could only be accepted or disbursed when both the agent and the person providing or accepting the cash were on video.

And here we have an example of the mindset of the State, and in this case, the rancid anti-Americanism that is at the heart of many thinkers in the U.S.A. All people are presumed guilty. You have no right to privacy. Surveillance should be universal and pervasive. All financial transactions should be treated as suspicious by default.

Look at the list in this section; they even approve of surveillance in taxis as a method of eliminating financial privacy. This is as far away from the American dram as it is possible to get, and people do not want the sort of world that the authors of this paper envision as necessary. This is why Bitcoin, E-gold, the Liberty Dollar and systems like it are popping up all over the place. If the State was legitimate and a force for good, there would be no need for people to spend their time developing currencies whose central feature is to get your money out of the clutches of the State. In fact, this might go some way to explaining why email was developed without encryption built in (apart from the fact that it pre-dates modern fast processor and the Public Key Cryptography systems that were developed after the advent of email). In the 1960s people’s faith in government had not been shaken to its core. Nowadays of course, there is little faith in the State; it is widely and correctly understood to be a malevolent and destructive force for evil.

For the United States to ensure its national and financial security, the ability to understand the massive flow of digital information that is the global financial system today, from micro to macro, and from baht to Bitcoins, is of fundamental importance. Where once the numbered Swiss bank account, the wire transfer to a shell corporation, or, as in All the Presidents Men, a paper bag containing $25,000 in cash were primary means for covert financial activity, the Internet and mobile phone networks are the potential setting for a vastly expanded set of new, digital avenues for conducting hidden transactions.

Given the rate of change of the digital landscape, any set of solutions constructed based on a single snapshot in time will quickly become obsolete. However, by creating the collaborations, regulatory frameworks, and technologies that reflect todays more fluid and diverse financial transaction environment, government and industry will be better positioned to address illicit transactions today and to adapt to address those of the future.

The conclusion of this paper amounts to wishful thinking. The jig is up for the State in its present form. They are going to have to adapt radically and philosophically if they are going to remain as the arbiters of anything at all.

Part of this radical change will be to address what exactly is meant by, “the United States to ensure its national and financial security”. What exactly is the United States financial security? The U.S. is a nation of people; if their money is secure, i.e. not being inflated away by the Federal Reserve, and they can transact locally and at a distance for next to nothing, what is the problem?

The problem is that the authors are not talking about the people of United States and their financial security; they are talking about the State, the Federal Government, and its financial security. In plain English, they are referring only to the Federal Government’s ability to levy taxes and collect them.

Digital currencies and peer to peer transactions are a direct threat to the Federal Government and its ability to tax. This is the only threat that they are truly concerned with; all of the other threats they list here are statistically insignificant compared to the trillions of dollars that could potentially be lost to them in a peer to peer digital currency world.

The statistical probability of being affected by terrorism is less than many daily fatal occurrences, like death from bee stings or anaphylactic shock from adverse food reactions. I do not even need to quote car accident statistics or even lightning strikes, or alcohol, or pharmaceutical related deaths, all of which happen at greater frequencies than terrorism by orders of magnitude.

Terrorism is not a pretext for trying to stop the future from being summoned. As for human trafficking and crimes against children, as ghastly and reprehensible as these crimes are, they are, mercifully, exceedingly rare and should not be used to destroy the tools, systems and free society that entrepreneurs and the creative are building.

It is completely inhuman, illegitimate, immoral and unethical to attempt to suppress and destroy people’s rights. In the 21st century, we have the tools, the understanding and the will to build the systems that will forever repudiate the claims of the State that it was ever needed to make everything run smoothly. Digital currencies like Bitcoin are only one tool in this movement, the writings of Murray Rothbard, Lew Rockwell, Ron Paul and the distribution systems that spread these ideas are the main ways that this revolution is taking place. No doubt, in private, the authors of this piece would call for the internet itself to be permanently and entirely shut down for the sake of ensuring the ‘security of the United States’. It is this irrational, un-American thinking that is behind the recent discovery that Justin Raimondo has been under F.B.I surveillance, simply because he writes articles.

It is a great tragedy that so many Americans have lost touch with the idea of what America was meant to be. Apart from that tragic loss, its interesting to note that this paper is concerned not with the plight of the poor in the ‘third world’ and the unbanked millions who have no access to capital. They are not concerned with the human suffering that could be lessened by the new technologies that are being developed. They are only concerned with themselves, and their own narrow parochial interests, that are borne out of a fundamental misunderstanding of the proper role of government and what people’s rights are.

Its up to every person who can think and write and run software to refute these fallacious arguments, to use the new systems at whatever level they can and to spread the ideas of liberty. We simply must not let these wrong headed statist arguments go unchallenged.

I have refrained from explicitly detailing the thinking behind the assertions I have made in this piece that claim or infer that we do not need the State, that the State is illegitimate on its face, and that it has no rights in and of itself. I will leave it to the reader to visit the Ludwig Von Mises Institute website for the background, evidence and proof that these are all facts. There are posts on this Blog that go into this in detail also. You cannot go far wrong by reading Lew Rockwell’s blog for a complete rundown of these ideas and links to many scholars and philosophers. If you want to understand the basics of all of this, you should buy and read Murray Rothbard’s For a New Liberty which is also available for free. To understand money and how the State has interfered in it to its near total destruction, you need to read What has government done to our money, also by Murray Rothbard.

With these tools in your hands you will be able to understand and prove to yourself that everything I have said in this piece is true, and why the paper that I have debunked is as wrong as something can be wrong.

It is incumbent upon you to demonstrate that you are not a part of the coercion and violence that the paper critiqued here espouses, and that you are willing to live with other human beings without them. If you are willing to co exist peacefully with your fellow man, then you should reject the basic premiss of this scandalous paper and its fallacious reasoning. If you do not, then you must concede that you are a violent person, that you approve of the coercion and violence of the State, and that the ends justifies the means.

Libertarians are willing and able to co exist with you. They are non violent; the very heart of their philosophy is that they can never initiate force against anyone. The measure and test of the ethical basis and morality of your philosophy should be wether or not you can co exist with others as the Libertarians can.

Many of you reading this will believe in democracy. You will use that word interchangeably with ‘fair’, ‘just’, ‘ethical’ and ‘good’. It is none of those things. I put it to you that your society cannot survive as it is without coercion and violence, and that it is doomed to failure because it is based on coercion and violence.

Hungarian translation of this article.

Guardian warmongering over Pakistan encryption ban

Wednesday, August 31st, 2011

The Guardian helps to whip their idiotic readers into line in advance of regime change for Pakistan. All articles of the type that you read below are designed to discredit the governments, like them or not, of the target countries with lies, hypocritical attacks and pure propaganda.

France ‘banned encryption’ in the 1990s; Dominique Strauss-Khan ended the restrictions Where were all the howling articles about interception then?

Where are the howls today about the deliberately weakened A5 GSM encryption? Where are the howls from the Guardian about ECHELON? Where are the howls about RIPA, which forces you to reveal your passphrase? Where are all the howls about the German government’s attempts to break into Skype calls? Where are the howls about all the abuses going on from inside their precious ‘democracy’?

Before you attack Pakistan, get your own house in order. If you do not, then every foreign country in the world will point to you as an example of how to govern correctly. US/UK has full access to all land line phone calls, mobile calls, internet traffic that is not encrypted and a myriad of other ‘intelligence sources’ which actually means immoral privacy violations on a mass scale. They also have access to all of the communications taking place in Pakistan.

It is only natural that Pakistan, who is not invited to share in the data collected by the west from ‘their own citizens’ that they should take steps to get access themselves.

Lets do this!

Pakistan to ban encryption software
Internet service providers will be required to inform authorities if customers use virtual private networks in government crackdown

This is no different to the moves in the west to force ISPs to retain data and cut off users who are sharing files. Once the French (for example) figure out that VPNs can be used to share files and beat their ban, they will move to outlaw them also. You dont think that France could possibly ban VPNs? they already did something just as stupid, as you can see here.

Internet users in Pakistan will no longer be able to access the web through virtual private networks following the government ban.

Millions of internet users in Pakistan will be unable to send emails and messages without fear of government snooping after authorities banned the use of encryption software.

The same is already true of users in the US/UK. Millions of internet users cannot send email without fear of government snooping, so what is the problem with Pakistan doing the same thing? I wonder if these Guardian shills can explain why they think that its OK for US/UK to ‘snoop’ on communications but its NOT OK for Pakistan to do so. Of course, they would not call it ‘snooping’ in the US/UK, they call it ‘security’. It is base hypocrisy turned up to eleven.

A legal notice sent to all internet providers (ISPs) by the Pakistan Telecommunications Authority, seen by the Guardian, orders the ISPs to inform authorities if any of their customers are using virtual private networks (VPNs) to browse the web.

Seen by the Guardian, but not by you. Pics or it didn’t happen. There is absolutely no reason why the Guardian should not publish this document so that we can see if for ourselves. But of course, the Guardian is a paternalist newspaper that rather than let you make up your own mind, presents a sugar coated, fact free fait accompli for you to swallow whole. Wether its articles on economics, computer security or anything else, they do not present you with all the facts. But lets move on…

Virtual private networks allow internet users to connect to the web undetected, meaning that they can access banned websites and send emails without fear of government interception.

Pakistan’s 20 million internet users have previously been banned from popular social networks, such as Facebook, because of blasphemous material about the prophet Muhammad. All internet traffic in the country travels through the Pakistan Internet Exchange, which can be intercepted by the military and civil intelligence agencies. The move echoes a crackdown against encrypted communications across the border in India and in China.

And what is left out of this part is the fact that BBM is encrypted, and that back door access to it has been given to the State right here, the recent mass looting being the pretext. Lets also not forget that right here, it was seriously proposed that Twitter and Facebook be ‘shut down’ in an ’emergency’ by the state.

Why are these journalists whining about China, Pakistan and India, when the same nasty things are being done right here? Those countries are acting rationally and following the example of the UK.

The Pakistan Telecommunications Authority legal notice urged ISPs to report customers using “all such mechanisms including EVPNs [encrypted virtual private networks] which conceal communication to the extent that prohibits monitoring”. Anyone needing to use this technology needs to apply for special permission, the notice said.

OUTRAGEOUS! Not.

Authorities in Islamabad insisted that the ban on VPN access was intended to stem communications by terrorists.

Terrorists do not use VPNs or GPG/PGP. Those of you who are up on this remember the bogus Steganography Threat that did the rounds years ago. Bad journalists at papers like the Guardian claimed that terrorists were hiding secret messages inside photos posted on the internet. There has never been a single instance of this found; it was just pure hype, just like this article is pure hype, and like the pretext Pakistan is using to ban VPNs because of ‘Terrorism’ is pure nonsense.

However, banks, call centres and many other businesses use encrypted connections to communicate with their branches and customers, to protect sensitive data such as account numbers and passwords.

Which is why the French ban in the 1990s didn’t make sense, and this doesn’t make sense either.

“This is like banning cars because suicide bombers use them,” said Shakir Husain, chief executive of Creative Chaos, a Karachi-based software company. “You have to find out who these guys [extremists] are. This is a blanket, knee-jerk, response.”

Mr Husain, you cannot possibly expect common sense out of these people. They exist in a parallel universe where logic, rational thought, morality, ethics and decency are poisons.

There is strict regulation of internet traffic in Pakistan.

LETS BOMB THEM! REGIME CHANGE! SPREAD DEMOCRACY!

Last year, the authorities banned the entire Facebook website for months after a user launched a contest to draw a cartoon of the prophet Muhammad.

LETS BOMB THEM! REGIME CHANGE! SPREAD DEMOCRACY!

Accessing the internet on BlackBerry smartphones is problematic, because of the device’s high-security encryption software.

But its not a problem for the US/UK, because they have back door access, and journalists at the Guardian do not care about that; instead, they care about a country thousands of miles away, where no one reads their rag, where only the elites use the internet, and where they cannot have any influence whatsoever. No, this article is designed to make you feel good about living in the ‘free’ west, to pour scorn on Pakistan, and to loosen your resistance in advance of the day when the bombs start dropping on them.

Recently the regulator made it impossible for Pakistanis to access the website of Rolling Stone magazine, after it published an article on the high proportion of the national budget in Pakistan that goes on its military.

[…]

http://www.guardian.co.uk/world/2011/aug/30/pakistan-bans-encryption-software

In Britain, you can be arrested for possessing books. Pakistan banning Rolling Stone is no different in any way.

Britain has the highest level of google takedowns in the whole world. Blogs are amongst the most targeted. Of course, the Guardian has nothing to say about this whatsoever; all eyes on PAKISTAN!

This is warmongering, hypocrisy and nauseating, stinking garbage wrapped into one pice of filthy propaganda.

Anyone with an intact moral centre understands that the people in Pakistan have the right to live in whatever way they choose. It is not the place of anyone to point a finger at them and say that they are not living correctly; point your bony finger at your own State and its dirty dealings, immoral restrictions, privacy invasions, lies and mass murders and fix your own problems.

Lest we forget, people in Pakistan are not plagued by millions of CCTV cameras; you can walk all over the place there without being watched. Which country has the most CCTV cameras in the entire world, violating millions of people on a daily basis?

It seems today, that it is impossible to read any article in a newspaper that tells the truth.

It doesn’t matter any more.

No one is getting their news from the war machine and its paid shill monsters. Take a look at this:

Look at the seething, roiling anger in the face of the murder machine apologist, face contorting like a cornered rat. These people know that the jig is up, no one trusts them anymore, no one is listening to them; all they have are straw men, ad hominems and syrupy appeals to emotion.

This is why we have the absurd stories of viagra fuelled rape squads and all the other completely bat-shit insane lies paraded by the lie machines. These stories, the manufactured propaganda smears are as sick as the people who repeat them. They need to go this far, because they have been caught lying so many times with the more reasonable sounding stories that only completely crazy scenarios will work to grasp anyone’s attention.

Sadly for them, thanks to the internet, these lies do not last more than a few days before they are completely debunked. They are running out of tools (plausible and implausible lies) that they can sell. This is why they are so angry; there is no higher volume to turn their lies to past eleven on the dial, and it is why, as you can see in the video above, they are so angry at Russia Today, who are playing better chess than them.

Russia Today is outflanking all other news media by telling the truth using the mouths of people who have the truth in them.

They get on a wide variety of completely credible people to tell you the whole truth, and who, when you research what you have been told, can be verified every time as telling the whole truth.

Contrast this with what The Times, the BBC and The Guardian peddle, and you begin to understand why Russia Today has all the respect, attention and the traffic, and why the US/UK mainstream media is losing money, credibility and attention.

Market volatility and Bitcoin

Monday, August 8th, 2011

One third of all the Bitcoins that will ever be created have now been mined. This is as a good a time as any to re-state the facts about Bitcoin.

It needs to be pointed out to the easily frightened out there on teh ineternetz, that Bitcoin has not ‘failed’ simply because the first company to provide a service that uses it (MTGOX) has attracted users who exhibit a class of behaviour and needs.

MTGOX is nothing more than a single company that is providing a service. It does not set the true value of Bitcoins, it publishes what its users are willing to pay for it. This has nothing to do with the actual value of Bitcoin now or in the future.

We can infer this by using a thought experiment.

Imagine a world where Bitcoin is in use by one hundred million people. Every day, people use it for every conceivable type of purchase. It is easy to obtain Bitcoins and people have no problem understanding them or spending them.

Now imagine this world with or without MTGOX.

The value of Bitcoins does not change in this world very much, one way or another with or without MTGOX. The aggregate demand of one hundred million people, all trading Bitcoins between themselves, measuring its true value on a minute to minute basis will tell each user what the real value of Bitcoins are.

And that value is orders of magnitude greater than twenty Federal Reserve Notes.

For example, lets suppose that you buy a Chinese take away meal for eight people for one Bitcoin. And that includes four bottles of Champagne. You get an instant feel for what a single Bitcoin is worth in the real world.

This is how real people determine the value of their money. This is how they know that ten dollars is too much for a can of coke.

What is happening now with Bitcoin right now is that it is circulating in a closed feedback loop populated by highly skilled programmers with financial software backgrounds, Libertarian monetary policy enthusiasts and over-clocking geeks. Once the Bitcoin economy breaks out of this closed feedback loop and is in wide use, it will not be possible for a single exchange to alter its value.

This is the inevitable scenario that the Bitcoin detractors cannot see. Bitcoin now is exactly analogous to the birth of email, and all the arguments against email taking off and replacing the post, all the arguments against shopping on the internet all apply equally to Bitcoin.

As I said before, the rate of adoption that Bitcoin will experience will be very much faster than the rates of adoption of email and web browsing. What needs to happen to push adoption along is this:

  • The building of simple to deploy tools so that anyone can accept Bitcoin.

And that means plugins for Word Press, Magento, OS Commerce and every other platform that is out there. Imagine a ‘+01’ button for every page you publish on the internet. Imagine Stack Exchange implementing this ‘+01’ button. Do I even need to go on?

It doesn’t take a genius to imagine what would happen if someone developed a Bitcoin app for Facebook. If it spread virally, you would exceed one hundred million users of Bitcoin in a very short amount of time.

Already, people have been donating to posts on BLOGDIAL through the address that is published on every post made by ‘irdial’. Other bloggers are explicitly asking for Bitcoin tips in their sidebars. Once the word gets out that you can make money simply by posting a string on every post, adoption of Bitcoin will explode in the Blogosphere. I imagine the quality of posts will also improve dramatically, as people craft their words to solicit tips, rather than to simply get something off of their chests.

Bitcoin is not MTGOX. MTGOX is a service that is built around Bitcoin. At any time, some piece of software or some service could emerge that will cause adoption of Bitcoin to go viral. Even something as simple as a simple Tweet from a highly influential blogger could cause literally millions of people to download the client and start using Bitcoins.

Anyone who says Bitcoin is finished because a small group of people are agreeing on artificial prices on its first ever large scale service doesn’t understand what Bitcoin is, or what its potential is.

And a final note. The Federal Reserve stopped publishing ‘M3’ the metric that told you the number of dollars in circulation. Bitcoin is different. We know how many Bitcoins are in circulation at every instant because it is public knowledge and will always be public knowledge. In this respect, Bitcoin is more transparent than the dollar, and of course, there is an upper limit to how many Bitcoins there will be, unlike with the dollar that can be printed willy nilly.

The low exchange rates that Bitcoin services are quoting are a great opportunity, maybe (or maybe not) your last opportunity to get Bitcoins at a low price through the current exchanges. As it is with Gold, you will kick yourself if Bitcoins go to $5000 per Bitcoin, just as gold is predicted to go at least ten times higher than it now stands, at record prices of $1671. Both gold and Bitcoins are cheap at today’s prices.

You have been warned.