I decided to pick up a copy of a book by Leftist academic Danny Dorling, called Population 10 Billion: The Coming Demographic Crisis And How To Survive It, while I was at the Hay book festival towards the end of last May. I wangled a corporate invite to the event and must say that I thoroughly enjoyed it.
Professor Dorling (Professor of Human Geography at the University of Sheffield, a former government advisor, Honorary President of the Society of Cartographers, etc, etc.) is eminent, although I hadn’t previously heard of him. And what intrigued me enough to buy his 438-page book is that the message, at least at first glance, seemed to be a refreshingly non-doomongerish one.
But… and there is a big “but”. Professor Dorling is perhaps sufficiently aware that being an anti-gloomster has its costs if you want to get on in academic circles, and certainly if you want to get lots of jobs advising policymakers about this or that disaster that has to be avoided by lots of state activity. And the ultimate nightmare for such a person is to be dubbed a “denier” and be put in the same bracket as the sort of lowlifes who deny mass murders of Jews in Europe and so on. And he certainly doesn’t want to be mistaken for any kind of apologist for capitalism and liberal free market economics. Oh good god, no! So rather than calling himself an “optimist” (terribly out of fashion) or a pessimist, he is a “possibilist”.
Now, Samizdata readers, you might think the preceding paragraph is a bit unkind. How dare I suggest that Prof Dorling says what he does due to worrying about his academic career and bank balance? Well, I might have been gentler on him had I not seen plenty of evidence from him about his desire to play the man, not the ball, so to speak.
To give some flavour of where he comes from, consider this:
“People who doubt that social inequality is a great problem can become exasperated when they cannot convince others of their views. When they find that their opinions are generally regarded as abhorrent and they cannot publish them in refereed journals, some turn to writing for right-wing think tanks and discover that they could in just a few weeks `knock out reports that would be presented at high-level meetings… and earnestly discussed in the press and in radio interviews. [They say] It was exhilarating to find an audience.’ Although it might be exhilarating for the former academic involved, it can be highly confusing for those who have to listen to half-formed ideas knocked out in a couple of weeks by someone who does not understand when their peers repeatedly tell them that there is a problem with what they are proposing.” (Page 130).
Prof. Dorling quotes Peter Saunders, who is has moved rightwards from the Left; he has committed the thought crime of casting doubt on aspects of British egalitarian post-war policy, and has ruffled feathers by a critique of a recent book in this area, called The Spirit Level. (You see Saunders’ website here to get a handle on just how much of a serious academic he is. His career has been every bit as distinguished as Dorling’s, if not more so.) There is something particularly nasty about Dorling’s words: the lazy, supercilious tone; the jeering claim that Saunders’ views and those like his are just blown together in a few days, and the assumption that anyone who challenges egalitarian ideas is “abhorrent” and therefore unfit to have their views published in peer-reviewed journals. It perhaps does not cross this man’s mind that because so much of modern academia has become an echo-chamber of the Left, that any academic with an ounce of independence of mind must go and write for some alternative institution in the hope of entering debate (as Peter Saunders did and explains in an account here of what happened to him.)
His book is full of ex-cathedra statements about equality. Much of his argument is that unequal societies are more wasteful than egalitarian, more tightly planned ones. He is very much a “watermelon” – green and red. Above all, Professor Dorling likes to get personal: For example, on page 5 he launches into the “Rational Optimist”, Matt Ridley, sneering that due to Ridley’s posh background and former chairmanship of the near-bankrupted Northern Rock, “it is not hard to mock his views”, but then goes on hastily to state “that they need to be taken seriously because they are part of the current mantra of many at the top of the tree.” Oh how jolly noble of him. If it were really the case that Ridley’s “rational optimism” is the dominant mentality of our government and its advisors, rather than the mishmash we have in the UK coalition government, I’d be much happier.
The ironies abound. Professor Dorling likes to play the high-level academic, but he also wants to take on views he disagrees with often by recourse to argument from motive. He wants to make out that he is an ultra-serious academic, but the book (which is a good read in some ways, if you can stand the bias) is full of such ad hominem digs at those he disagrees with; his discussion of nuclear energy, for example, includes suggestions that those who favour it are just motivated by money.
In other words, Professor Dorling is a bit of an arse. I want my money back.
Creating more value in an economy would do more than wealth redistribution to combat the harmful effects of inequality.
- Tyler Cowen, in a review about a much-discussed book by Tom Piketty on the subject of inequality. Piketty favours a lot of heavy state activity to control and reduce said inequality. Now, it is easy to just default to the standard libertarian line and say that fretting about such inequalities is just an excuse for a statist power grab. The fact is that the sheer gap in wealth we can see today is a reason why, however mistakenly, idealistic, smart people are fearful of, and hostile towards, laissez-faire capitalism. So it is worthwhile to keep making the economic, philosophic, and political case for why coercive measures to reduce inequality is bad and dangerous.
I could not resist adding in this paragraph from Cowen:
The simple fact is that large wealth taxes do not mesh well with the norms and practices required by a successful and prosperous capitalist democracy. It is hard to find well-functioning societies based on anything other than strong legal, political, and institutional respect and support for their most successful citizens. Therein lies the most fundamental problem with Piketty’s policy proposals: the best parts of his book argue that, left unchecked, capital and capitalists inevitably accrue too much power — and yet Piketty seems to believe that governments and politicians are somehow exempt from the same dynamic.
Money buys success in football and several clubs now have more money than United. From 1997 through 2004, United topped the consultancy Deloitte’s “rich list” of European football clubs ranked by revenues. In 2012-13, United dropped out of the top three for the first time since Deloitte began compiling the list. Real Madrid, Barcelona and Bayern Munich now have higher revenues. Moreover, Chelsea, Manchester City and Paris Saint-Germain have oil-rich owners who pump money in rather than sucking it out. By the logic of the market that means there are six clubs in Europe more likely to win the Champions League than United. In the domestic league, by the same logic, the club’s natural position is now third behind Chelsea and Manchester City. (Less wealthy Liverpool will probably win this season’s Premier League, but their overachievement is probably unique in recent English history.) United’s biggest problem isn’t David Moyes. It’s money.
- Simon Kuper, writing about the sacking by Manchester United today of David Moyes, manager since last July. Kuper, who writes in the Financial Times, has also co-authored a study examining the linkages and correlations between success on the field and money in the bank. Short summary: the link is very strong but not totally bomb-proof. (In other words, if you support a relative minnow as I do, you can still live in hope.)
This is from that haven of supercilious argumentation, the Financial Times:
Only The Ignorant Live In Fear of Hyperinflation. (Paywall protected). The article is by Martin Wolf, whose confidence in the benign force of central banking remains undimmed, nay, is enhanced, by the events leading up to and after 2008.
Here are a couple of paragraphs that I can extract for you:
Understanding the monetary system is essential. One reason is that it would eliminate unjustified fears of hyperinflation. That might occur if the central bank created too much money. But in recent years the growth of money held by the public has been too slow not too fast. In the absence of a money multiplier, there is no reason for this to change.
In other words, if the ignorant masses can be told about how spiffing modern fiat money systems are and how they are managed, we’d be all a lot happier.
A still stronger reason is that subcontracting the job of creating money to private profit-seeking businesses is not the only possible monetary system. It may not be even the best one. Indeed, there is a case for letting the state create money directly.
Put the state in charge of increasing/cutting the volume of money in the system. I am sure that will work like a charm. What could possibly go wrong?
Okay, enough of my sarcasm. Now, it may well be that fears of hyperinflation are unwarranted. It is entirely possible that in the West, we face a Japan-style multi-decade period of stagnation rather than hyperinflation. The structure of the economy, even demography, can have an effect on how quickly/slowly money moves around the system. Despite various central banks – particularly in the case of Japan – printing money in vast amounts, it may be that we should not be concerned about what the State is doing, and continues to do, to money.
But it is worth noting that since 1971, when Nixon severed the gold link to the dollar, although that link had been dead in all practical terms for a while, the dollar has lost about 85 per cent of its purchasing power. And much the same can be said of the fiat money systems in force around the world. No doubt the FT thinks this is nothing to bother about. Weimar? No chance of that happening again, old boy. Too many clever people working in the central banks to let that happen again. Trust us, stop worrying and it will all come out in the end.
The irony, of course, is that people who tell us to stop fretting about the central bank buggeration of money and the need to put even more State control over all this are the same as those who say it is folly not to be scared witless by AGW, or by whatever fashionable panic happens to be out there (particularly when it is associated with calls for governments to “do something”). But if people are fearful of something caused by states with their monopoly powers, then the FT’s reaction is a typical example of what we get.
“Those soaring incomes of the top 0.01% are only going to apply to those very few indeed who can make that leap from performing on the national to the global stage. And there’s really not enough of such people that I think it’s something that we’ve got to worry about. 0.01% of the US population is, for example, 3,000 people. Seriously, what does it actually matter to the rest of us what they earn? Especially as they’re not earning it by moving from taking 10 cents each to a $1 each off each of us 300 million, they’re doing it by moving from taking that same 10 cents each of each of us and then making up the other 90 cents by taking fractions off the other 7 billion people on the planet. As I say, this isn’t a foolproof, watertight, explanation of what’s going on. But now we’re seeing that it is the top 0.01% taking that extra income the evidence is at least consistent with my explanation. That it’s all being driven by globalisation: and as such there’s not a dang thing we want to do about it.”
- Tim Worstall. Yes, you may have noticed that I spell globalisation with an s, not a z. Pax Americana hasn’t yet spread to my London-based laptop.
One of the most encouraging things happening to the British pro-free-market and libertarian movement is the outreach work being done by the Institute of Economic Affairs, to students at British universities and in British schools. In this IEATV video Steven Davies and Christiana Hambro describe what they have been getting up to in this area. They are a bit stilted in their delivery and demeanour. Steve Davies in particular is a rather more relaxed, animated and persuasive public performer than this short video makes him seem. I get the feeling that there were retakes, as they negotiated car doors and seatbelts when on camera. But if any of this inclines you to be put off, don’t be, because the process these two excellent people are talking about in this video is definitely the genuine article.
They mention the Freedom Forum. This has, says Davies “rapidly become the biggest gathering of pro-liberty students and young people in the UK”. The latest iteration of this, Liberty League Freedom Forum 2014, is happening next weekend and its detailed timetable has just been announced. If this get-together was just a one-off annual event with nothing else related to it happening, that would definitely still be something, although I do agree with those who say that the title of these things is a bit of a mouthful. But LLFF2014 is a great deal more than just an annual event, being but the London manifestation of a much bigger program of intellectual and ideological outreach to universities and to schools throughout the UK.
Recently I dropped in at the IEA, where Christiana Hambro and her IEA colleague Grant Tucker made time to tell me in person about what they have been doing. I also picked their about people who might be good to invite to talk at my last-Friday-of-the-month meetings. For me, the most interesting thing that they said to me was in answer to my question concerning to what extent their outreach activities were piggy-backing on the earlier efforts of the Adam Smith Institute, efforts which have been going on for many years, under the leadership of ASI President Madsen Pirie. What Christiana Hambro and Grant Tucker said was that when it came to outreach to universities, then yes, their work does depend on earlier ASI efforts. University economics departments are tough nuts to crack open with contrary ideas, and the best way to get to universities is by working with free market and libertarian student societies, rather than relying on the intellectual hospitality of academics. The ASI has done a huge amount to encourage such groups over the years, and without such groups what the IEA is now doing in universities would have been harder to accomplish.
But in schools, it has been a very different story. The ASI has done plenty of work in schools as well over the years, but what Christiana Hambro and Grant Tucker said to me was that basically, in schools, the IEA’s outreach operation is basically operating in virgin territory, with economics pupils all of whom have heard of Keynes, for instance, but none of whom have ever heard of Hayek. Another way of putting that might be to say that when it comes to preaching free market economics to British schools, this is a town that is plenty big enough for the both of them.
Schools are also different from universities in often being much more open to different ideas than universities are. Universities are dominated by people who take ideas seriously, but this can have the paradoxical result that many universities and university departments become bastions of bias and groupthink, all about deciding what is true and then defending it against all heretical comers. Schools, on the other hand, some at least, are more concerned to persuade their often indifferent pupils to care, at all, about ideas of any kind, which, again rather paradoxically, makes many such schools far more open to unfamiliar ideas than many universities. A teacher may be a devout Keynesian, even a Marxist. But if these IEA people from London can help him stir up his pupils’ minds by showing economics to be an arena of urgent and contemporary intellectual and ideological conflict rather than merely a huge stack of dull facts mostly about the past, then he is liable to be very grateful to these intruders, even if he flatly disagrees with their particular way of thinking.
Present at this Liberty League Freedom Forum that is coming up next weekend, which I will be attending (just as I attended LLFF2013 last year), will be some of the products of all this outreach. Someone like me has heard most of the featured speakers before, some of them many times. But many of the people at LLFF2014 will be hearing talks from people only a very few of whom they have ever encountered before. Here are some of the topics which they may find themselves learning about: Public Speaking and Networking, Doing Virtuous Business, How To Be A Journalist, and (my personal favourite) Setting Up A Society (i.e. a school or university pro-liberty society).
As for me, no matter how many times I hear Steve Davies speak, I am always keen to hear what he has to say about something new, and this year, I am particularly looking forward to him answering the question: “But who will build the roads?” In my opinion, when Libertaria finally gets going, somewhere on this planet, defence policy (often regarded as a big headache) will be very simple. Just allow the citizens of Libertaria to arm themselves. But, building “infrastructure”, while nevertheless taking property rights seriously (instead of merely taking seriously the idea of taking people’s property from them to make infrastructure) will, I think, be much more tricky. I look forward very much to hearing what Davies has to say about this.
Too bad that his talk clashes with the one about Setting Up A Society. I’d love to sit in at the back of that one also, and maybe I will pick that one on the day. That such clashes will happen is my one regret about this event. But you can see why they want to do things this way. As well as big gatherings, they also want small ones, in which new talent feels more comfortable about expressing itself, and flagging itself up as worth networking with, by other talent.
I recall writing a blog posting here a while back, in which I described a talk I heard the IEA’s then newly appointed Director Mark Littlewood about his plans for the IEA. Right near the end of that piece, which I think still stands up very well, I wrote that: “there is now considerable reason to be optimistic about the future of the Institute of Economic Affairs”.
There still is, and even more so.
I am reading Pride and Prejudice, annotated by David M. Stoppard. It’s the part of the novel where Elizabeth is starting to figure out that Darcy might be an all right bloke after all. Mrs Gardiner and Darcy’s housekeeper are discussing him:
“His father was an excellent man,” said Mrs Gardiner.
“Yes Ma’am, that he was indeed; and his son will be just like him — just as affable to the poor.” 
Note 34 reads:
Helping the poor was an important function for one in Darcy’s position. The large numbers of people in this society with meager incomes, and the fairly limited means of public support available, meant that the need for such assistance was often great, especially in years of poor harvests.
Shortly after, and related:
“He is the best landlord, and the best master,” said she, “that ever lived. Not like the wild young men now-a-days, who think of nothing but themselves. There is not one of his tenants or servants but what will give him a good name. 
Note 37 reads:
The tenants would be those renting land on the estate and farming it; they could have frequent reason to deal with the owner, especially since owners could help fund improvements to the land that would raise productivity and benefit both owner and tenant.
So it turns out that it is not the case that the state is the only thing standing in the way of the rich laughing as the poor starve. And poor harvests? Thanks to globalisation, the “poor” have it easy now-a-days.
“Hardly anybody has heard of the Roman poet Juvenal these days, which is a great shame. He was the first, as far as we know, to ask one of the central questions of political philosophy: “Who will guard the guardians?” He was rightly paranoid, arguing that someone must watch the watchmen, those who are entrusted to look after us – such as, to pick one example at random that he couldn’t possibly have conceived of, the Financial Conduct Authority (FCA). The problem, of course, is who will watch those who watch the watchmen? But Juvenal’s realism is not shared in the current political culture. We tend to assume that regulators are self-evidently superior to profit-seeking capitalists. Unlike the supposedly rapacious bankers, our regulator-kings are thought to be motivated by higher aims: the pursuit of the common good and other disinterested, noble goals. Not for them power or pay hikes.”
- Allister Heath.
He is talking about the FCA’s recent impact on the UK insurance industry. Not exactly stellar performances from the regulator. But then with all such bureaucracies, the “mission-creep” problem exists. Dragons are sought to be killed, mountains are built to be climbed. The FCA, like its counterparts in most other developed nations, is constantly looking to “consult” on new initiatives, such as cracking down on such naughtiness as “peer-to-peer” lending and crowdfunding; its recent regulatory overhaul on the UK wealth management sector, through what is called the Retail Distribution Review, has led a number of firms to drastically increase the minimum sums of assets a potential client must have to be taken on, creating what is called the “financial orphan” problem. The FCA’s predecessor, the Financial Services Authority (part of that organisation’s powers were sent back to the Bank of England by the current UK government about two years’ ago) was not particularly prescient or effective in heading off the sub-prime debt disaster, although no doubt some of its officials had worries.
The issue, as Allister Heath says, to remember about such organisations is not to single out individuals for wrath; some of them are highly intelligent and diligent people. I think it was Hayek or Friedman (Milton) who cautioned champions of free markets against the ad hominem fallacy of bashing civil servants. Rather, they said, if you create bodies with sweeping powers, and create incentive structures for empire-building, then this is the sort of problem you get. To take a different case, look at how the US War on Drugs, and greater budgetary powers, has led to the militarisation of US police.
The problem with the FCA is that it exists. Had we stuck to an order where laws were strictly enforced against force and fraud, and where people were enjoined to remember “let the buyer beware”, rather than treat consumers of financial services as nervous children, we’d be a lot better off. Yes, financial services can be complex, and yes, some of them sound very odd (try explaining financial derivatives to your average Joe). But in general terms there is no more reason why sales of such services should require any more state oversight than the sale of groceries or bathroom fittings.
I attended Dominic Frisby’s talk at Brian’s, and Brian asked me to write about what I learned.
The talk did not get far into the technicalities of Bitcoin, which was good for me as I already think I know most of it. Until recently I knew some of it, and two articles by Ken Shirriff completed that picture.
But Dominic is not the quiet, contemplative, theoretical person that I am. When he wants to find something out, he goes out and talks to people. This means he has lots of stories. And so I learnt of his experiences attending a Bitcoin auction under a marquee in a London back-street (the most culturally diverse gathering he has ever attended), talking to wealthy Bitcoin owners who live in squats and are part of the Occupy movement, and exploring the myriad Darknet marketplaces that have sprung up after the demise of Silk Road. He compared Bitcoin now to Rock and Roll in the 50s. People are doing it for fun, with irreverence, but also a sense that it is something big and uncontrollable, and with the same pattern of reaction from authorities: horror gradually giving way to acceptance.
This irreverence is particularly on display with the alternative crypto-currency (or altcoin) Dogecoin, which I think should be pronounced doggy-coin because there is a picture of a dog on its logo, but everyone else pronounced it with the o from go and a soft j. Dogecoin was spun off from Bitcoin as a joke, but is finding uses in micropayments because you can pay tiny amounts with big, psychologically pleasing numbers. I actually mined some Dogecoin the evening before the talk, because I wanted to try out mining and it turns out you can’t mine Bitcoins without specialised hardware, but you can mine altcoins. I currently have 600 Dogecoins worth 40p.
A developer of a Dogecoin smartphone app was in attendance, and he told the story of a Dogecoin fundraiser that managed to send the Jamaican bobsleigh team and Luger Shiva Keshavan from India (who became known as the Underdoge) to the Winter Olympics. We all discussed the usefulness of microtransactions for tipping the authors of interesting blog posts. They might need this when all the newspapers run out of money. Here is my Dogecoin address, by the way, hint hint, I have no shame:
Before the talk I was confused about altcoins, wondering why anyone would make yet another crypto-currency, but now I understand. There was discussion about how Bitcoin might fall, be replaced by something else, and eventually there will be a winner. But the other view in the room, and the one I favour, is of all these currencies co-existing. Partly they will compete, and partly they will serve different functions. For example, there will only ever be 21 million Bitcoins but there will be 5 million new Dogecoins every year forever. It is possible that Bitcoin will be used as a store of value and other currencies will be used for daily spending. Whatever inconvenience this causes can be solved with good software: whoever solves it first will be the new Paypal.
There are lots of problems impeding the mainstream acceptance of Bitcoin, and a sense that people are working on solving all of them. The demise of the exchange Mt.Gox will lead to better security practices such as distributed signatures, ways of auditing banks, and peer to peer exchanges. People who want more safety will get deposit insurance and wallets pegged to fiat currencies. And there is no shortage of convenient payment methods. There is even a Bitcoin vending machine in London.
The other cool thing I did that evening was buy a signed copy of Dominic Frisby’s book Life After The State for 0.03 BTC (he would have accepted less, but the novelty of the transaction made me generous). I’ll be sure to read his Bitcoin book, too.
“Natural gas was the origin of the crisis in Ukraine. It is in Russia’s interest to keep Ukraine and Europe hooked on Russian gas at prices just low enough to quash incentives to drill and frack for shale gas. Russia’s state-run news and propaganda outlets have for years disseminated articles critical of fracking and supported opponents of the technique. Now with Yanukovich gone it’s as if Putin has taken the Crimea as a kind of hostage — collateral to hold against what Ukraine owes Russia for gas. The desperation of Putin’s actions underscore the threat that shale gas development really does pose to Russia’s gas-fueled diplomacy.”
Christopher Helman, Forbes.
A new book, called The Frackers, has come out on the issue of the shale-gas engineers and how they have succeeded despite, and not because of, state involvement. Al Gore or whoever might try and lay claim to have invented the internet but they certainly cannot do so with fracking. About the best that can be said of the role of government is that it sometimes upholds property rights necessary for said activity to go ahead.
Sam Bowman’s talk tomorrow at the Rose and Crown has been causing worries for Libertarian Home organiser Simon Gibbs, on account of Meetup not working properly. Simon has become unsure about how many people are going to show up, but urges us all to come anyway. (I definitely intend to.) He ends his report on all this by saying that …:
… the capacity issue sometimes looks tricky on paper, but it rarely is.
My experience, with my last Friday of the month meetings, which take place in a living room which is only about half the size of the room upstairs at the Rose and Crown, is that it is almost mystical how exactly the number of attenders seems always to suit the space available for them. It’s a kind of benign spacial variant of the original Parkinson’s Law. Last Friday, for instance, Dominic Frisby looked like he might be stretching my infrastructure beyond its limits. But then I emailed people to that effect, and there was a bug going round, and the weather turned nasty, the upshot of all that was that the number who showed was just right to fill the room in comfort, and just not enough to cause any discomfort. Amazing.
It’s like we really do not need to be planned or coerced by a central authority, but can just sort things out for ourselves.
Mine was a fairly Bitcoin-savvy gathering, and several of the Bitcoin-savants present have said that they were surprised at how much more they learned, both from Frisby and from each other. I was not one of those experts; I was merely there. For me, the main message I took away from the evening was that Bitcoin, in the opinion of many people, does have real value, because it makes electronic economic transactions far easier. Although some doubts were expressed, nobody present dismissed Bitcoin as a complete fraud and a bubble waiting to just burst and vanish. In general the mood about Bitcoin was very positive, more so than I had expected, and of course even better about the general principle of encrypted currencies generally.
The big news item was that Frisby reckons he has cracked the identity of the founding genius of Bitcoin, a mysterious figure who is currently only known by a Japanese alias. Who is he? Read my Bitcoin book, said Frisby. This will be available some time around late spring or early summer, and I will keep Samizdata posted.
The other thing I will remember about last Friday was that, for complicated reasons involving an NHS kidney operation that suddenly became available (after a huge wait) to his usual back-up canine custodian, Frisby asked if he could bring his dog with him. You don’t want mere attenders bringing dogs. But since the speaker would be the main victim if a dog attended and spoke out of turn, I figured that Frisby’s dog almost certainly would behave exactly as well as promised, and so it proved. Frodo, despite being rather obviously hungry and eager to make friends with potential food providers, behaved impeccably throughout the entire evening. Not a single bark, not one. Again: amazing.
Picture of Frisby and Frodo:
Sam Bowman’s talk tomorrow will be about the idea of a legally fixed minimum wage. The libertarian orthodoxy is that, just as we don’t want or need the government to be organising our social lives or our healthcare, a government-ordained minimum wage is a really bad idea. When I met Sam earlier in the week, this orthodoxy is what he told me he would be reinforcing in his talk, citing some recent evidence.
We also discussed the idea of Sam addressing one of my last Friday of the month meetings later in the year, on the far more contentious subject of “Bleeding Heart Libertarianism”. He is, or such is my understanding, and no doubt with various reservations and qualifications, for it. I am not now totally against Bleeding Heart Libertarianism but am strongly inclined that way. I am far less inclined to leave the definition of Bleeding Heart Libertarianism as the sole property of those now calling themselves its supporters. I also have a very high opinion of Sam Bowman. That should be another good gathering, as and when it happens.
Incoming from Detlev Schlichter. He is back blogging. His second recent posting, the one after the one that just says he’s back, is about Bitcoin. He thinks that the Bitcoin principle, so to speak, even if maybe not Bitcoin itself, has a future:
Central bankers of the world, be afraid, be very afraid!
My own sense is that, just as Schlichter says, the world’s rulers are now stuck in a monetary prison of their own making, from which they cannot now extricate themselves. Quite a few of them understand approximately what is wrong with their current policies, even as many others of these people have no clue. Many others favour the current state of the banking system, because it enriches them even as it impoverishes most others. But even those banker/politicians who do understand what harm they are now inflicting upon the world and would like to stop, don’t know how to. It is one thing to be in a prison and to know that you are in a prison, quite another to escape from the prison.
To switch metaphors from the prison to the hospital, the world’s banking system is now alive rather than dead, but not in the sense that the patient is up and about, playing beach volleyball with its children like a tampon advert woman. It is alive merely in the sense that a terminally ill patient, lying in a hospital bed after a horribly intrusive death-postponing operation, sinking slowly rather than fast, is also alive rather than dead.
Only outside monetary influences, such as Bitcoin or such as variations on the Bitcoin theme, will bring back a world of true money.
The fact that, if you put some of your wealth into Bitcoin, you just might lose damn near the lot is a feature not a bug. Government guarantees that you won’t lose out no matter how unwise your decisions may prove to be are the problem, not the solution.
Schlichter spends quite a lot of his piece denouncing a certain Mark T. Williams, a finance professor at Boston University’s School of Management, but he ends his piece by quoting him again…
If not controlled and tightly regulated, Bitcoin – a decentralized, untraceable, highly volatile and nationless currency – has the potential to undermine this longstanding bond between sovereign and its currency.
… and agreeing with him! That’s a feature rather than a bug.
Welcome back to the blogosphere, Herr Schlichter.
LATER: And as I should have added, I am hosting a talk tomorrow evening about Bitcoin etc., given by Dominic Frisby (that’s Dominic’s thoughts on the recent Bitcoin disaster/price plummet (which Bruce Hoult explained here)). There is not a lot of room left for more would-be attenders, but there is, as of now, some.