The Anti-Bank

This week has been crazy in the world economy. With the Swiss Reserve Bank unpegging their currency (the fourth largest in the world) and lowering their interest rate to NEGATIVE 0.75! The Swiss frank dropped to the floor and then jumped through the roof like a drunken teenage crypto-currency. Japan has already been at negative 0.25 for ages to no avail. The Euro is at zero. The US Reserve bank is offering 0.15 percent on their bonds and because of this tiny fraction of interest the US dollar has hit record ..what. .Highs? Considering that they've announce that they are going to stop printing trillions and think about only billions.This all compares to a New Zealand economy that is just scrapping by really, but still manages to run a rate of 3%.

“Lets face it, the US economy is not exactly a rockstar. The internet of things not really that rockin just yet.”

This week the word is “black swan” and.. I feel like I better post this quick before this all becomes to retrospective. What did we really do to fix the world economy after the GFC?

Let’s get this whole complicated macro economic thing in perspective for a second. In Macro economics (basically economics for countries) Zero is supposed to be the bottom limit for reserve bank rates. Simplified this makes sense because how would you convince someone to give you a million dollars for your government bond without offering a financial incentive in return. So, with a negative rate no-ones going to want to give that government any money. That is unless they where loosing more than 0.75 percent where they had their money originally, then they might opt to take the smaller loss i guess.

“Smith, Marx and Keynes would be pulling eachothers few remaining white hairs out in a triangle of dribbling geriatric rage.” 

The other side of it is that banks are required to hold a certain percentage of their deposits in government bonds. In NZ its 5% so that means 5% of the money you have in the bank gets held at treasury (the other 95 odd percent actually just gets lent out again FYI). So the bank is forced to put money in the government, and with a negative interest rate it also has to pay that at the end of the term. Sounds ok to us, but actually it means that the bank doesn’t want to hold deposits and is encouraged (even further) to get rid off depositors and get all its customers into dept. Further more when the bank needs to get some extra cash from the reserve bank to make some new loans, the reserve bank will pay them to do it. No Deposits, heaps of liabilities. Sustainable? .Not really! In macro economics eventually the value of the nations dollar has to come down.

“How can we let this happen, lets face it these bank exec’s screwed us all over.”

Sorry about the economics rant, but if you think this is confusing, it's because it is! It's all way too complicated and now its being twisted into an even bigger mess. Makes Bitcoin math and a few encrypted codes seem like childs play in a sand box.

What does this mean for bitcoin? the price has been thrashed in the last few weeks, never mind the last six months. Well, it doesn’t actually change much. Bitcoin has always been a kind of solution to the sort of problems posed here and by the GFC etc. In a way this is just a deepening of what’s been happening over the last 20 years in finance. In that way all this mess should be helping the cause, still can’t see it in the price though?! It's the status quo for bitcoiners, but it may get some currency traders back in on the game.

But here’s the thing. Bitcoin has nothing to do with all this crap! Over the last couple of years bitcoiners and Bitcoin companies have been trying to gain legitimacy by trying to assure their place in the financial system. We’ve debated over whether it is considered legal money in parliaments. We’ve made Bitcoin branding that looks just like what you see at the bank. Websites which are flasher. Security protocols on trading sites that are more indepth than UK emigration. New feed’s that never end, bottemless archives of information explaining the entire workings of the system. A comedic culture and international profile.

And Its good, It has worked. Bitcoin is totally legit. We now have Bitcoin traded on the stock exchange in CFD’s and we have multiple brands of Bitcoin money machine, we have other crypto-currencies that are strong in their own right, you can buy anything easily with Bitcoin and the governments didn’t ban it. The truth is though this is not what its about.

Bitcoin is not a bank! We aren’t all professional techie stock market people and governments couldn’t ban it even if they wanted to. The average bitcoiner is just an everyday person, who’s got a smart phone and likes to travel. And more importantly, distrusts banks.

Bitcoin doesn’t just do what banks do for free. It does more. It can change the world by turning money into something else, something unmoney.

It allows amazing tracing of abstract value to enhance equality.

It allows micro payments to be made seamlessly and without investment.

It adds accountability to the wealthy

It allows transparency for corporations

It facilitates global co-operation

It is a great tool for the local community with easy and safe value transfer for free

It’s not left or right wing, no one can take it over and it doesn’t trap people in dept

It can look however we want it to!

And this is my new pitch. The Anti-bank. The price only matters if your rich. Lets make it rad.

Alibaba is Great with Bitcoin and so is Volatility

A recent post stated that Alibaba, in its huge public offering hype, has caused the dip in the Bitcoin as of late. This has puzzled the hell out of me, how does such fud get through? Have they even used the site before?

Alibaba is and International E-Commerce engine. You can chat to the manufacturer of a product online, and YOU CAN USE BITCOIN TO PAY!! it's not regulated on the site! It makes the whole process a lot better and faster and cheaper, which is a key thing when you’re trying to get things manufactured on the other side of the world. It's a great thing for crypto-currency.

Its more likely the recent movement in the market involves two main factors.

1 is Apples decision to remove bits from their Chinese app store.  

2 the activity of the new CFD for Bitcoin coming online

We know China is the largest market for Bitcoin at the moment and that's because its a really good thing for the people there. Its seems that likely Apple have an issue with their Chinese State Commercial banker who doesn't like it. No kidding! not many bankers do, and you wouldn't want it to stall your iPhone role out. So the public sell off a few of their coins and it hits the media lens.

It's not like its hard for Apple to change their app store (maybe after the role outs done) they've done it before. You've gotta wonder how the general public in China feel about their latest U2 album?

In recent news you'll read that US stock exchanges have engaged the market with the new "certified" Bitcoin CFD (consumer finance derivative) in NewYork. This is point two. What you might not know is that this allows the computers that are actually located on wall street to make rapid transactions (in and out in milliseconds) on the wall street servers and take advantages against other traders, from this head start on the new Bitcoin CFD market. 

These "intelligent" (and ruthless) computer algorithms utilise the short sell just as much as the buy and can be set up with various parameters. They also tend to exaggerate fluctuations, such as the one discussed above caused by the news about iphone's. You would suspect that the operators are also quite anti-crypto. 

These systems have heaps of capital behind them and the CFD is linked to the physical Bitcoin market and can move prices around. I expect we will see surges in volume relation to the opening and closing hours at the New York Stock Exchange and sudo cyclical volatility which makes it very difficult to trade for profit with average Joe human logic. 

This has been happening on all CFD symbols. Currencies, stocks, precious metals and commodities all suffer from the same new randomness. Have a look at any chart They all look smooth and then change between 2002 and 2006 and go crazy jagged like this gold chart. This is around the time that advanced computer trading systems came online.

The thing is that Bitcoin can handle more volatility than any other, whats the word? trade thing? CFD, currency, you name it. Its survived more volatility than anything else we've seen in the last 500 years (including tulips).

Volatility also has less impact on purchases made with digital currency than with other mediums. For example; on the Dell or Overstock website, or Open Bazaar or Alibaba or wherever you may be using your coins, the street? the value of Bitcoin required can be automatically updated to compare with something else in real time. Unlike old money, Cryptographic money has no "foot leather costs" and you don't have to get up write over price price tags. We have an app for that;)

Instant transfers mean that the value during the course of a transaction doesn't have a chance to move. This whilst the financial bots on wall street throw every currency around the block. Like an earthquake 8.0 on the Richter scale as you wait the 4 days that it takes to transfer old money internationally. Bitcoin users can feel safe with a flexi earthquake strengthened currency.

It all adds up to a better Alibaba

Bitcoin Poster

I have started Crypto currency blogging because I love the stuff and have a whole lot of experience and knowledge to share. I also feel I've got a different perspective than a lot of the blogs I read that hopefully appeals to the average Jo. I want the blog to be informative yet a little entertaining and hopefully insightful as well.

My perspective appreciates an underground social movement as well as the conventional geeky business types. This is why when I first discovered Bitcoin and cryptographic currency it inspired me to write this bulletin type thing and then turn it into a poster.

Download it here: https://mega.co.nz/#!nNJmyDoL!e0Zd11mtPtey2BMTpYDtvhuBHgeNIEvV7IKsmyFScts

You can put it up on all the lamp posts in your town. The concept made me reminisce of going around the streets at night putting up band posters. Usually with a can of beer in hand and some extremely tight black jeans. Chuck Taylors are recommended for a quick silent escape. You can even easily change the bit address and the format to suit your own plans, add some cool art magazine clippings etc. There's something cryptographic about it.

Lets get our basement printing presses going and get the message out with some good old flower and water fugitive zines. So many fun times to be had crossing over from the digital world into our streets.