...at initial group project meetings.
It's a dirty job, but someone has to meme it
Striking as ever...
Returned to my high school (and junior college) for the first time in a long while - at least since the MRT station got completed. Not often that a centenary year comes around, mind. Was good to see some of my old classmates, whom I haven't come across for ages either. The Prime Minister himself made an appearance, though according to a more in-touch friend, the emcee was from a prominent - and once exiled - Barisan Sosialis family. Well, what's a banquet without some old spice?
And while we're on throwbacks...
Me: *flipping through newspapers* Not a very harmonious week, I'm afraid; various local bans, first on the black metal band Watain, after targeted pressure from the piety brigade - Watain weren't shy in labelling the authorities as "honorless rats" on Facebook; well, not like they were ever going to be invited back anyway. Perhaps to balance the scales, said authorities banned an American pastor, for negative remarks about Muslims, next. This of course led into the Christchurch atrocity, where a self-described eco-fascist murdered at least fifty Muslims, while live-streaming the entire proceedings.
There was the usual online debate about whether to give the perpetrator the notoriety he desired, but it would quickly become a non-issue, as global newspapers (including our The State's Times) rushed to disclose his identity. Discussion then turned to whether to give his manifesto any attention at all, and of course, it was also moot - copies had sprung up all over the Internet, and as such, the only realistic option was not to ignore, but to refute it.
Keeping in mind that examining the writings of mass killers - e.g. the Unabomber, the Trope Namer, and the Isla Incel (covered here in 2014) - has oft been considered reasonable, if only as a means to try and stop such outrages from happening again, it cannot be denied that the latest perp knew well what he was doing. By scattering blame all over - he describes himself as, other than being eco-fascist, not a conservative but possibly Christian, right wing, left wing, socialist and Fortnite-inspired, his overtly-stated aim was to sow discord between all these various groups; most pertinently, between gun rights advocates and those opposed to firearms, but also NATO and the Turks (whose needs, as we have seen, are being blithely ignored). In fact, he is willing to state it outright, because it makes no difference - the same divisions will begin to tear.
Will this be accurate? Well, we will see.
Learning From History
Me: Eh, time for some active learning, after getting inspired by another manifesto that I purchased in Hong Kong:
The CCP Gideons
Mr. Ham: Is this another hare-brained whimsy of yours?
Me: Shush, this will be fun. I've written up a new scenario, and you - yes, you - are the newly-installed leader of a Republic newly-converted to democratic socialism. Your people look to you, Mr. Ham! You have been elected - extremely narrowly, but elected nonetheless - on a platform of income and wealth equality for all, ownership by all, jobs for all, generous redistribution, and Green Energy. Mr. Robo here will be your loyal right-paw ham, and he will communicate your decisions. I'll be behind that curtain as GM, modelling the outcomes.
Mr. Ham: So I'm Great Leader?
Me: Well, technically, your official title is Commiessar, from the character sheet. But it's up to you frankly, you're in charge.
Commiessar Ham: I quite like the sound of that, actually. Okay, the revolution was successful, we have spontaneous celebrations in the streets, and we, like, redistribute stuff! Squeeze the rich, give to the poor, I get adored, so simple. Where are the chicks?
Secretary Robo: Uh, sir...
Commiessar Ham: Don't "sir" me, Secretary Robo! After the Great Proletarian Revolution, we are all equal here! Down with the selfish, materialistic, capitalist swine!
Secretary Robo: Excellently said, uh, comrade. First, about the "redistribution" part, it turns out that the bulk of our richest, uh, traitors, have long transferred most of their assets overseas and flown the coop. Extended election season, you see. As have many of the top executives and the most-skilled workers. They've stuck lots of Trollface posters up too, with messages like, "Think we haven't seen this coming?"
Commiessar Ham: Hmph. So be it. We don't need non-believers here, only those pure of heart and intention. Too long have our poorer brothers suffered, while the wealthy feasted. Distribute what's left of their possessions.
Secretary Robo: The looting has taken care of much of that, comrade. And, uh, we have another problem. There are small pockets - ok, many small pockets of... misguided resistance, especially in the rural countryside. They've barricaded their homes and farms, and hung up banners with messages like, "Don't Tread On Me" and "We Will Never Be Socialist".
Commiessar Ham: Can't be having this, can we? Send the police in to arrest them and maintain order.
Secretary Robo: ...they have a ton of firepower, if I may say so. And, in some places, they have the local police on their side.
Commiessar Ham: *sighs* Fine, send in the army.
Some bloody months later...
Secretary Robo: Okay, Commiessar, we have it mostly settled. Only about 5% of the population is dead, but they were evil counter-revolutionaries anyway. We have another tenth locked up, but fortunately there were ample prison facilities.
Commiessar Ham: A certain amount of sacrifice is necessary for a better world for all, my good Secretary. And don't call it prison, we must never forget to be positive; call them, hmm, re-education camps or something. Remember to put up some uplifting slogans too, like "Honest labour liberates" or somesuch.
Secretary Robo: Wonderful, comrade. But, uh, remember when we promised to support those who were unwilling to work?
Commiessar Ham: Of course. In our new society, nobody is to be left behind - citizens may not want to work for many reasons, and we have to respect that. There is so much surplus - and previous capitalist inefficiency - that surely all reasonable accomodations can be made.
Secretary Robo: Er, there's a... lot of ill-will going around, Commiessar. Many of our loyal new cadres have taken to the option very... wholeheartedly, and those who are working tend not to be happy, at being forced to share. Happens often in hippie communes. And, there isn't all that much surplus left. Turns out operating modern factories needs plenty of high-level workers, who are mostly... somewhere else.
Commiessar Ham: Well, I'm sure our fraternal socialist bros will be willing to lend a hand to tide us over this temporary issue.
Secretary Robo: *twiddles whiskers* We've sent out feelers, comrade. They were very sympathetic, but also all want tangible goods in exchange, or in lieu of that, barbarous bourgeois relics like "gold" and "silver". Extremely unworthy of them, if I say so myself. We did get a bunch of "Petro" crypto, but it seems to be basically worthless. Oh, and half of our ambassadors defected. And the university students aren't happy as a whole either - many of them confessed to just wanting free tuition and dorms, and there are grumblings that they were better off before.
Commiessar Ham: You thinking what I'm thinking?
Secretary Robo: Send educated malcontents to farms to work. Got it. Two birds with one stone. Wise as ever, Commiessar. And, to stem the freeloading, we have implemented the regrettable measure of having to record citizens' labour output, as directed. The universal unit of account was therefore defined as the man-hour, since all citizens' effort and time are equal by definition in a socialist paradise. However, small problem: the miners are complaining that their work is dirty and dangerous, and they should thus be rewarded more than, say, part-time childcare workers in the cities.
Commiessar Ham: We cannot countenance such dissent. Deal with them.
Secretary Robo: Uh, we shot the leaders of the first batch as usual, comrade. Then the first batch. And the second. But we are now running out of miners, and truth be told, we need them badly. As such, the Central Committee is wondering if certain... exceptions might be made.
Commiessar Ham: So, say we grant them a special, one-off only, bonus of an extra half man-hour for every man-hour, in recognition of exceptional duty. That wouldn't compromise our principles, right?
Secretary Robo: I'd say so.
A few days later...
Secretary Robo: Commiessar, the engineers have heard about the miners' bonus, and are now demanding an extra hour for every man-hour, seeing as their contribution is even more critical. The leaders of the first batch shot themselves to save us the trouble, which I think should be considered in their petition.
Commiessar Ham: Yeah, sure, what's it to me?
A few years later...
Commiessar Ham: You know, it's exceedingly difficult to maintain our basic principle of income equality in the face of so many distractions and temptations, but I'm proud to say that we have never wavered from our objective.
Secretary Robo: And it's all due to our great Commiessar. There has been some vile journalist - probably an infiltrator - who tried to put out an article on how you, despite not drawing any official compensation, have been able to access foreign luxuries at will. All vicious lies, obviously. We have executed him, and sent his entire township to the mines. Then demolished the town. And salted the ground. You can never be too sure.
Commiessar Ham: Nobody knows me like you do, Secretary.
Secretary Robo: *blushing* Gee whiz, thanks si... comrade. But just a tiny tiny detail. Remember when you allocated seventy-three million Revolutionary Credits to the milk program?
Commiessar Ham: Of course, only the best for our childre... wait, Credits? That sounds like... like... currency. Is it not an article of faith, Secretary, that the man-hour is a sacred concept? That it not be considered as merely a tool, as sinful money, divorced from the humanity that produced it?
Secretary Robo: About that, the Society of Socialist Feminists was behind it, comrade. They made a good case that man-hours disregarded their considerable contributions to the cause. And really, considering the hodgepodge of pronoun prefixes that made it out of committee as alternative nomenclature, I strongly recommend that you just accept it.
Commiessar Ham: *shakes head* Fine, fine. Yes, so, 73 million Credits for the kids. They love me, of course. Surely nobody could have protested at so noble a cause?
Secretary Robo: Definitely. And 253 million Credits for the widows.
Commiessar Ham: Certainly. All that shooting in the earlier years, it was terrible. I'm a lover, not a fighter, at heart, you know, Secretary. But there's no trouble there either, no?
Secretary Robo: No, not at all. In fact, you have shown remarkable generosity in signing off on just about any worthy budget item to grace your table. There's 512 million for infrastructure renewal, 62 million for animal shelters, 32.8 billion for agricultural research, 20.8 billion in foreign aid, 3.7 million for Britney Spears... *raises eyebrows*
Commiessar Ham: *raises eyebrows*
Secretary Robo: ...12.1 billion to support the elderly, 1.2 billion for the Revolutionary Scouts & Brownies, 7.6 million for rare disease mitigation, and 6.2 billion for a twenty-three metre tall jewel-encrusted marble-polished Commiessar statue.
Commiessar Ham: For national morale.
Secretary Robo: Of course. And, if I may report the good news first, we have, under your munificent leadership, produced a total of 21.73 bazillion Revolutionary Credits worth of work, for this calendar year.
Commiessar Ham: Tremendous! Two statues!
Secretary Robo: Continuing, this should be regarded in light of the budgeted expenditure of... 1736.09 bazillion Revolutionary Credits. Including the second statue.
Commiessar Ham: So?
Secretary Robo: Mathematically, this corresponds to a net deficit of 1714.36 bazillion Revolutionary Credits.
Commiessar Ham: So? I don't see the problem.
Secretary Robo: Well, you see, each Revolutionary Credit remains notionally pegged to one... *looks around* man-hour, yes? It means that we have pledged about one thousand seven hundred bazillion more man-hours of work, than we have produced. In fact, due to our special bonus scheme, roughly 96% of our official production did not, in effect, correspond to actual man-hours in the first place. But it's a rounding error anyway. In summary, this means, that, we, uh, cannot fulfil our obligations in any meaningful sense.
Commiessar Ham: *quietly* It's the math, right?
Secretary Robo: Um, Commiessar?
Commiessar Ham: The math is against me. I knew it. It was secretly capitalist, all along. *turns to a quivering Robo* You see the starving children, Secretary? The crying widows? The end of our glorious democratic socialist revolution? You tell me: am I right, or is the... *spits* math right? Where is the justice?
Secretary Robo: ...easy, Commiessar! We have long burnt the Common Core textbooks!
Commiessar Ham: Yes, Secretary. You are one of the very few I can trust, in these dark days. Tell me, loyal friend; what should I do? How shall we carry the revolution forward?
Secretary Robo: *sighs and picks up phone* Hello, Department of Statistics? Secretary Robo here. You know what to do.
Problem solved for now, honoured Commiessar. Oh yes, forgot something. *lifts phone again* Hello, Department of the Treas...
...wait, urgh. *turns to Commiessar Ham* I was just going to tell them to print more Credits, but they gone and done shot themselves first.
Commiessar Ham: Really jumped the gun there. Never mind, I can appreciate promptness in subordinates.
A few years later...
Commiessar Ham: See? Math, schmatz. What equivalence between production and expenditure? Our socialist experiment has thrived despite such capitalist tricks. Whew, hot day, isn't it? Tissue, Secretary Robo? Thank you. *wipes face* Hey, is this a hundred million Credit note?
Secretary Robo: I hear it has fine texture, Commiessar.
Commiessar Ham: Good, good. It is heartening that the revolutionary fervour has not died out, over the long years; volunteerism at the re-education camps is up 300%, so I hear from the provincial chiefs. It is touching to find such thirst for knowledge amongst citizens. But, you know, Secretary, I have heard... concerning news about certain Rightist backsliders organizing... markets. Not just personal exchange of goods, mind. Speculation! With Credits!
Secretary Robo: *adjusting collar* ...about this, they have been some of our most productive regions, my Commiessar.
Commiessar Ham: *narrows eyes* But isn't this expressedly against our fundamental socialist principles? Do these people think that our faultless central planning is not good enough?
Secretary Robo: They call it Distributed Socialism, comrade. So, uh, one side has these bolts, you see, and the other side has all those nuts, so they tell this third guy about all the bolts and nuts, and the third guy puts two and two together and brings them together, and everybody gets some bolts with nuts, including the third guy who keeps a few for his trouble.
Commiessar Ham: Go on...
Secretary Robo: ...so, it seems to work. And, a bunch of these third guys, knowing how wise and handsome the Commiessar is, have pooled together to present you with a small token of appreciation. Nothing of any significance, of course, just a humble measure of respect. The crates are in the back. Oh, and here's front-row tickets to the next Ariana Grande concert, and a certified licked donut by hers truly.
Commiessar Ham: ...I am a great supporter of innovation in socialist thought, Secretary. We must not be limited by the chains of our own precapitalist imagination.
Secretary Robo: Splendid! I will add that quote to the collection.
Commiessar Ham: Look, Secretary, distributed socialism is one thing, but now you have people lending Credits, and collecting interest! Isn't there a level below which we cannot stoop?
Secretary Robo: What? No, never, my Commiessar! This is merely the implementation of a Socialist Risk Premium! However unfortunate it may be, it remains that not all of our worthy socialist endeavours will pan out; as such, it is only polite for those who might want to temporarily employ a few more Credits - not borrow, because everyone owns everything here, comrade - to make sure to give back a little more. Which again, is everyone's. It's just the moral thing to do.
Commiessar Ham: Well, if you put it that way.
Secretary Robo: Backstage pass to Gal Gadot's guest musical.
Commiessar Ham: Thank you. Hey, is that a bloody... what do the evil capitalists call it... stock market?!
Secretary Robo: Blind date with Scarlett Johansson.
Commiessar Ham: I think you got the order mixed up.
Secretary Robo: Oh, sorry. Yes, it's not a stock market, we disdain that representation of capitalist decadence, now and forever, to the end of time! It's a Distributed Socialist Co-Prosperity Scheme. Very fun, I hear. Also does wonders for Credit allocation, and ultimately production.
Commiessar Ham: *stretches out paw*
Secretary Robo: Ah, right. My apologies.
Commiessar Ham: *pockets ticket* There's a right way and a wrong way to go about things, you know. It'll be a complete shame if our kids forget these basic principles, when they rise through the Committee ranks purely based on their own merits. Right, Secretary?
Secretary Robo: Totally, totally. By the way, the Committee's just approved renaming Credits to "Dollars", for better integration with the global economy. It's not like words mean much in the first place - it's the thought that counts.
And thus, we continue carrying the mantle of democratic socialism, into the new century.
With so much recent news on health and medicine (without even considering the latest data leak on HIV), I figured it a swell time for a theme post on the topic. Now, from personal experience, the local medical scene has been relatively well-managed, if with a heavy dose of self-reliance: see for example the requisitioning of relatives' Medishield funds before drawing upon the public coffers. Tangentially, official stats have finally revealed that local elderly are receiving just S$355 a month from their CPF, which likely implies that Roy Ngerng's (remember him?) assertion that "CPF payouts are inadequate, and among the worst in comparable developed nations" is probably true, as calculated here back in 2014. But it's not as if objective truth was ever much valued for its own sake.
A recent case against a doctor for not informing his patient of possible complications has brought on first a S$100000 fine, and then a backlash against its encouragement of defensive medicine - the mandating of procedures that result in a poor trade-off in terms of patient and physician benefit. It so happens that, if you screen for everything, your chances of finding something is pretty good, and that something is more often than not, a false alarm. The lesson then, it seems, is to be fully cognizant of what these trade-offs are; is ordering a S$1000 test for a hundred thousand citizens to potentially save one of them from paralysis responsible? It's easy to say that no expense should be spared with health, but when resources are limited in reality, some form of triage is unavoidable. Further, tests aren't perfect, and come with their own complications...
A number of Japanese medical schools have recently been revealed to have rigged their entrance exams to favour men (and those related to alumni). As a punishment, their education ministry has withheld subsidies for Tokyo Medical University, and one expects, the rest of the guilty.
We might at this recall the local quota of having only one-third of the medical intake be female, which was in effect as recently as 2002. Just to play male chauvinist pig's advocate, such quotas might actually be somewhat logical, from a wider societal perspective. Consider a country that has been estimated to require an influx of 200 new doctors annually. At the same time, far in excess of 200 students of both genders are eager to enter training. However, from decades of experience, while about 90% of male doctors will continue in the profession to retirement age, only 65% of female doctors will do so for various reasons, but most prominently due to entering the family way. Assume that all students are of identical medical potential. What selection strategy (in terms of gender ratio) would then result in minimal wasted training resources?
Framed as such, the solution is: all recruited students should be male; ceteris paribus, a male student can be expected to be 90% efficient in terms of service rendered, against 65% for a female student. Put another way, if the country needs 200 doctors annually, it needs to train about 220 male doctors, 310 female doctors, or about 265 total doctors assuming a 50:50 gender ratio (yes, I'm aware that when the retirement takes place matters, this is for illustrating the concept). In practice, not all students are created equal, and so it would be worthwhile to take some of the best female recruits; I expect that the past LKY-led administration settled upon the one-third quota after doing their sums.
Such reasoning likely won't fly as far today, of course - see the Japanese example - and in any case, local shortages have proven to be very pluggable with foreign imports.
WaPo reluctantly agrees - "apparently accurate".
Shifting our attention over to the United States, the White House's top A.I. adviser - GEOTUS Dr. TRUMP himself - has been successfully prosecuting a War on Drug (Prices) and Big Pharma, after some teething troubles (and yes, Big Pharma probably deserves it; consider Goldman Sachs: "is curing patients a sustainable business model?"). But seriously, perhaps less subtlety and more table-hammering is the way to go in these negotiations; have you heard of the White House's proposal to link drug prices to an international index - as with other nations' price caps - in the mainstream FAKE NEWS? Thought not.
[N.B. And on Goldman Sachs, they're currently being sued by the Malaysian government over 1MDB, after UMNO's historic upset last year. Those wanting the inside track might refer to Tom Wright's Billion Dollar Whale, which covers, among other salacious details, how part of the cash ironically went towards filming The Wolf of Wall Street.]
Show Me The Evidence
The fact that medicine has to be specified as "evidence-based" may strike some as strange - like, isn't medicine a science? You don't hear researchers debating "evidence-based physics", do you? Well, even modern medicine appears as much an art as a science, with senior specialists' opinions oft respected due to their unique experiences - which aren't easily quantifiable and codifiable into textbooks, it seems. The status of hard data and evidence has tended to be kinda iffy in medicine - for every John Snow celebrated for tracing cholera outbreaks by intelligent data mining and analysis, there's a Semmelweis driven to ruin by snooty hide-bound colleagues.
On this, we might examine the case of weed (a.k.a cannabis, marijuana). The momentum towards its legalization and normalization is only building up pace, with the World Health Organization recommending its rescheduling to Schedule I, equivalent to the widely-accepted morphine. The UK has conceded its medicinal effects, while Thailand and South Korea have promptly allowed its import for medical purposes. More generally, there has been much research on heroin and opioid substitution with cannabis, what with the ongoing opioid epidemic in the States (which, given their source, can't help but feel like long-deferred comeuppance on China's part; thankfully, GEOTUS has convinced them to control fentanyl exports while boosting weed, but somehow the mainstream FAKE NEWS sounds like it doesn't want him to succeed, as usual)
Now, evidence can be nuanced, and according to our Law and Home Affairs Minister, the acceptance of unprocessed cannabis for medical use is bunkum, and driven by financial gain. The CNB has dutifully backed him up with "think of the children" Youtube ads - which haven't been too persuasive to local Redditors, who were only too aware of similar evidence with alcohol and some TCM being ignored. Definitely, I can't see them allowing recreational weed anytime soon, and there are historical scars to consider, but this has the feel of a tide that isn't turning back. The most interesting implications, I'd gather, would be on tourism - if weed consumption becomes widespread both in North America and SEA, are the authorities really gonna arrest, say, the 10% or 20% of tourists that are stoners? Methinks they might become more flexible on evidence then...
A.I. vs. M.D.
Artificial intelligence seems the in-thing for now, and the advances just keep coming, what with OpenAI withholding their GPT2 text generation system because it's too good (personally, it's a bit of an exaggeration - yes, they can sorta mimic generic news columns, but that's not too overwhelming given falling journalistic standards). The rise of A.I. has also extended to medicine (a personal professional interest), with a number of well-publicized papers and demos in the past several years plugging human-level diagnostic performance in various fields: ophthalmology, radiology, dermatology, etc. Earlier this month, a US-China collaboration announced a system for diagnosing common childhood conditions from multiple input modalities. Slightly further out of left field, there's mind reading and physiognomy; one also suspects A.I. having a role to play in gene editing, which seems quite popular in truth.
Faced with this mounting evidence of A.I.'s capabilities, it is only natural that discussions about A.I. possibly replacing - if not all, then a good chunk of - doctors, have come to the fore. Those coming from the tech and business side don't see the replacement taking too long, it seems - computer scientist Kai Fu Lee predicts thirty years, while venture capitalist Vinod Khosla has radiologists becoming obsolete in five years, a bold sentiment more or less echoed by deep learning pioneer Geoffrey Hinton.
The radiologists (and other physicians) aren't going down without a fight, definitely. From my reading of their opinions on various forums and subreddits, very few doctors believe their profession under appreciable threat. Other than technical concerns with adversarial attacks, hidden training biases and natural language understanding (which I believe still lags some way behind imaging applications, despite OpenAI's hype), a few popular arguments against A.I.'s proliferation in medicine are often repeated: legal implications (who's responsible?), the presence of other data not typically included in A.I. modelling, the importance of a doctor's soft skills (bedside manner), and ultimately, acceptance by physicians themselves.
On A.I. models not currently being able to consider the full gamut of inputs (e.g. physical examination notes, labs, other patient background) and explain the underlying scientific basis for decisions, I'd say that there really is little preventing A.I. from improving in these respects; as such, the assertion that mid-level practitioners will be more affected is, to me, kinda doubtful. Indeed, it's entirely possible that - assuming legal issues are sorted out - the analysis is farmed out to an A.I., with the "human touch" supplied by cheaper consultants; there really isn't much correlation between a doctor's medical competency and his likeability, after all (see: Gregory House, M.D.)
No, I'd say that physicians' greatest advantage here would be the medical profession's regulatory powers - they can, in many cases, simply veto the use of A.I. tech. Medicine is, after all, one of the very few guild systems that remain. Most countries have a ruling association that restricts memberships through controlling licensing and available training slots, which has largely preserved the prestige - and wage levels - of the profession to the present day. However, this is not an impregnable defence. Consider the case of optometry; consumers have learnt to purchase glasses and contacts online after getting a prescription, eating heavily into optometrists' expected income. While there have been attempts by optometrists to stymie online transactions out of patient care concerns, these are unlikely to work if the cost savings are large enough - which they often are. Note that fervent campaigning against online retailers didn't work out for Sim Lim Square either...
Meanwhile in China
Shanghai's A.I. powered unstaffed medical clinic booths might then be a peek into the future. Let's face it, most consultations are boringly routine; blood pressure, tongue depressor, stethoscope to chest. This costs twenty to thirty bucks here, possibly a lot more in the USA without insurance. Is there a market for having patients wrap the blood pressure cuff over their biceps by themselves, and hold a stethoscope to their own chest - perhaps guided by an automated laser pointer - while being questioned by an A.I. diagnosis chatbot? If it costs just a couple of dollars, I'd say - heck yes. And, you might not even need the A.I. for this; I'd gather there would be more than a few living and breathing general practicioners in less-developed countries willing to do some telemedicine.
It's the same story that has brought down many other craft professions - divide the task up, and mercilessly compete away supernormal profits on the parts that can be automated, by A.I. or otherwise (i.e. assembly-line manufacturing). But given that it'll probably make healthcare much more affordable, I'm not sure if such a shakeup of the medical profession would even be unpopular with the population at large. Open Health, as with Open Software? Let's see if Google is feeling generous.
Mr. Robo: ...well, that was a long intermission. How was Hong Kong and Hawaii?
Me: Good, but, one matter at a time. Let's finish up the Bitcoin analysis, before doing the travel recap. Beginning with a question that has been raised by a number of my friends and acquaintances: as anyone who has browsed CoinMarketCap must have noticed, why are the price movements for all cryptocurrencies so correlated?
More specifically, consider this observation: the price of Bitcoin rises (or falls, which seems to be the more common movement these days) 3%. The general tendency, then, would be for the prices of alt-coins to also rise (or fall) about 3%, thereby largely preserving exchange parity when denominated in Bitcoins. However, one would expect that if the change in price had been driven by some Bitcoin-only news (e.g. another Bitcoin ETF delay), then the price of alt-coins should remain largely unrelated, in fiat currency terms. Why this discrepancy?
The answer then would firstly be that Bitcoin remains the main trading pair for alt-coins, especially the smaller ones that exist only on smaller crypto-only exchanges (that avoid having to contend with pesky banking regulations). As such, the natural inertia indeed tends towards preserving the exchange rate on the Bitcoin trade pairing, in the same manner that a drought in California would increase the price of locally-grown artisanal almond juice in US dollars due to reduced supply, but have next to no effect on said almond juice price in, say, Indian Rupees.
At this point, it may be appropriate to confront an interesting thought experiment proposed by a couple of Federal Reserve economists, arguing that the proliferation of alt-coins is dragging down the Bitcoin price:
While the economists do submit that the analogy isn't perfect because crypto exchange rates aren't fixed, one could note that the analogy is much poorer than it could have been. By conflating Bitcoin with a Hamilton tenner, and Altcoin(s) with a Lincoln fiver, they are insinuating that various crypto systems are entirely interoperable, and thus any Altcoin could sink Bitcoin by issuing coins willy-nilly. The far more natural analogy, one would feel, would be to conflate Bitcoin with a US dollar bill, and Altcoin(s) as foreign dollar bills. The question could then be posed as to what would happen if the supply of foreign (say, Venezuelan) bills were increased dramatically; a short visit to a Caracas dining establishment should provide the economists better intuition about whether hyperinflation in a two-bit currency materially depresses a reserve currency (it doesn't)
Mr. Robo: ...to be honest, the standard of reporting on crypto mostly leaves much to be desired.
Market Segments & Use Cases
- Darius510, r/cryptocurrency
"The first mover status of Bitcoin is an objective truth in an ocean of subjective tribalism. It is the only characteristic of any coin that can never be imitated, iterated upon, cloned, forked, or be challenged in a debate of merit.
Without Bitcoin, cryptocurrency has no scarcity."
- polomikehalppp, r/bitcoin
(consider also: Lindy effect in crypto)
Me: That said, in their defence, alts do probably affect Bitcoin prices, although the exact relationship is tricky. For example, Monero and the like might attract a privacy-obsessed crowd, that might not otherwise have been interested in Bitcoin, thus expanding the crypto market as a whole. The question, then, would be: how many different (types of) cryptocoins does the world really need? From existing evidence, the answer seems to be: quite a lot fewer than already exist.
As repeatedly emphasized, cryptos are fundamentally monetary (or protocol) plays, and not technology plays; as such, rampant innovation-for-its-own-sake was never the point - nobody buys into a national currency because they introduced new high-tech shiny plastic banknotes, and in fact reinvention has led to the decline of more than a few high-profile platforms (Digg, maybe Facebook). It has been noted that indexing in crypto has historically been a losing proposition due to the high number of rubbish hype alts and ICOs that oft die completely, which has brought with it the advice to stay within one's circle of competence - which we have striven to. Of course, in a true bull run, it probably won't matter much, from the price correlations.
In the wake of this latest popped bubble, a back-to-basics reassessment might be in order: what use-cases are there for crypto, and what is the demand for each of those? Off-hand, we might recognize:
Beginning with random services, we might note that many of those seem mostly... unnecessary (e.g. Dentacoin, oBike's oCoins, Sakae's Bitecoin, imgCoin for image hosting and Kim Jong Coin, greatest of them all), with many of these fanning interest by touting partnerships with big-shot companies - oft short on details. But seriously, why does every firm or industry need its own token? Like, a dozen Weedcoins?! It's like having your friendly neighbourhood pot dealer insisting on non-transferable vouchers, rather than good ol' greenbacks. Bankster initiatives like R3 aren't doing too well either, even considering it got picked over Ripple for SWIFT, as the extant financial system is arguably fundamentally trust-backed-by-legal-might based - contrasting heavily with blockchain's most novel property of decentralised trustlessness.
Interoperability protocols appear to necessarily be a secondary, derived demand, which brings us to Ethereum-style platforms. Personally, I adore the vision, but Oracle problem of interfacing with the real world for error-prone smart contracts aside, it remains that distributed apps have been exceedingly slow - likely unavoidably slower than simple value transfer, for the same security - and something of a solution in search of a problem. This is not to say that Ethereum, EOS, NEO etc are doomed, ETH for one remains very thoughtfully designed and actively developed. It remains, however, that platform-centric tokens appear somewhat easier to replace - in other words, have a weaker "economic moat".
Which takes us to the original commodity money and payments motivation, as exemplified by Bitcoin. We have argued for the attractiveness of its store-of-value function, and we might also note that the "naivety" of Bitcoin's design - as compared to Ethereum's latest iterations, for example, and oft derided as out-of-date by the r/Cryptocurrency set - is actually an asset. As with all good cryptography (and unlike IOTA), Bitcoin is relatively straightforward to analyze, and its limitations and failure conditions are well-known, rather than obscured.
These security basics, by the way, have been rather harder to come by with most altcoins. In practice, we have seen EOS block producers forming cartels out of the gates, resulting in double-spends being rubber-stamped. Bitcoin Gold and Ethereum Classic got 51% attacked, as most cryptos not called Bitcoin are frankly quite vulnerable to. Bitcoin ABC is relying on the hack of enforcing immutability after ten confirmations - which brings its own set of issues, while the experience of Nano and IOTA thus far suggests that theoretical blazin' speed by itself really isn't the point, not with decentralization at stake.
Pumpy Dumpty Broke The Wall
Best crypto trading video of 2018
Mr. Robo: So, in short, continue loading up on Bitcoin.
Me: Well, and maybe Ethereum.
See, the trouble with investment advice is, you gotta recommend what you're holding; because if you promote something else, the obvious question would be, if it's so good, why aren't you into it? Can't be having that, can we?
Just to make it clear - when my pals buy alts, I'm hoping they succeed, but the fact is that objectively speaking, I can't be confident of that. Goodness, I've tried to read the alt markets, but the sheer amount of dodginess going on, such as with market cap gaming - even acknowledging that Bitcoin's hardly that pure either - is astounding.
There's the pump-and-dump groups, of course, where the ringleaders arrange to pump the price of some benighted altcoin up, only to then dump their bags on late-arriving chumps. The trouble with getting on this action - ethics aside - is that one can hardly be sure of not being on the "chump" side, especially without insider information. But seriously, this is just classic penny stock shenanigans, transplanted. Fortunately, this is not too hard to detect by machine learning, it appears.
This might however pale in comparison to the long con of scam projects (many originating from you-guess-where), in which the coin, exchange, ICO or dApp creators put up just the right front, throw out the hottest buzzwords and organize rigged contests, to lure unsuspecting investors. And, the best thing is, if executed correctly, the big exit's probably even legal. Then again, one supposes the incentives are often out of whack. Consider some hotshot ICO hawker - guy makes some outlandish promises and poses with Jack Ma, and gets tens of millions thrown at him with next to no conditions, all upfront; cutting and running, claiming most of the profit with none of the scheduled work, sure sounds tempting...
Long story short - if you're going to play the altcoin markets, at least spread your investments out. Perhaps the proportion of altcoins that die can be slightly exaggerated, but not by much.
Are Bitforks Any Better?
- Vitalik lays on the burn
Alright, no alts. But what about those Bitcoin forks then? Surely they, as the direct descendant of the chain, might pose a threat to replace it, and thus be a value buy?
Recall our piece on the dear Dr. Craig S. Wright, and his quite senseless hocus-pocus, two and a half years back. He certainly hasn't been idle about spamming nonsense, and his alliance with Bitmain's Wu Jihan predictably eventually went up in flames, with Dr. Wright insisting on his own Bitcoin Satoshi Vision (BSV) fork - which is just as well, given that they've all but exhausted materials-based suffixes with Bitcoin Polyester.
This led to the November hash wars on the already near-unused Bitcoin Cash chain - so people aren't hung up on block size, after all - which saw both Jihan's Bitmain and Wright's Ayre burn millions on renting hashpower, only for the combined price of the resulting chains to be lower than what Bitcoin Cash had started with. BSV remains, as Vitalik so poetically put it, a pure dumpster fire, leaving Dr. Wright a pile of unsellable tokens after conceding defeat.
It's hardly better for Jihan, however, as he by all accounts swopped just about all their real BTC for BCash, somehow managing to turn a near-IPO money-minting miner manufacturing business, into a firm that's shedding staff and overseas offices, while pushing questionable cloud mining and A.I. out of nowhere, in an effort to stave off bankruptcy. Quite a remarkable development, given that all Bitmain had to do was to sell their machines honestly, possibly after "burning them in" with a bit of mining on the side. But ego always gets in the way, one supposes. And, get this, after resisting segwit for so long, Jihan wound up proposing the segwit-enabled Lightning Network as a BCash scaling solution. Maybe next time...
Rule One: Never fight a hash war in Asia
Scaling By Lightning
Returning to the scaling issue that precipitated the Bitcoin forks in the first place; it's not gotten much press, unlike more flashy alts, but the Lightning Network's quietly up to roughly five thousand-plus nodes, twenty thousand channels, and 500 BTC over the past year - even after a partly-adversarial experiment. As explained last February, it's a true network, rather than a collection of separate peer-to-peer channels; in theory, once it gets big enough, Bitcoin microtransactions - the ubiquitous coffee payment problem - will be nigh-instantaneous and nearly-free. Assuming most future users being happy to rely on a Lightning Network or similar second-layer solution, almost all transactions can be offloaded from the base Bitcoin layer.
This tradeoff - using a secondary layer, rather than continually expanding the capacity of the base layer, as the Bitforks do - has always been the more sensible solution to us, all the more given the security limitations of Bitfork zero-confirmations. Definitely, Lightning has its own limitations - channels closing all at once, intuitively - but clever fixes are constantly coming into play. For example, regarding the cost of using two transactions on the base network to open a channel, researchers have proposed Channel Factories to batch channel creation.
Certainly, it's important to question the Lightning Network setup, with concerns that it cannot be properly decentralized - due to the formation of large hubs - pretty common. On the surface, this seems to be happening with payment providers such as Square getting into the act. However, personally, this seems like an issue that LN will naturally outgrow, with the target endpoint being normal users eventually transferring crypto over LN seamlessly, oblivious to the internal workings.
Obligatory Crystal Ball Gazing
Mr. Ham: Privacy patches like Mimblewimble are also coming - interesting times ahead, to say the least!
Me: To be honest, I'm a teeny bit concerned that improving privacy too much might scare regulators off at this point. Then again, I don't see them holding the tide for long, given how the blockchain concept's getting normalized. Thirty years ago, you'd be something of a weirdo - or a boffin, at best - to be tinkering with mobile phones or related computing devices. Today, every kid is face deep in their smartphones and tablets.
Warranted or not, optimism's not yet in short supply, despite the market taking an absolute beating in the past few months. The Satis Group's reasoned out about US$100k in 2023, Draper's sticking with US$250k in 2022, rather earlier than the pattern recognitioners over at r/bitcoinmarkets. Myself, I'm holding firm on US$40k after the next halving about 2021, and just for fun, a range of US$3k to US$8k this year.
...and really, where's our CEO? Let's check on Mr. Ham's office, Mr. Robo.
This is not what it looks like.
Me: ...okay, no point waiting for Mr. Ham to return, I suppose. Let's carry on, Mr. Robo.
The BTC Community Of Practice
Before continuing, we should perhaps establish some background for what is to follow. Amidst all the doom and gloom, the degree to which Bitcoin has captured the imagination of millions about the globe, is perhaps not often appreciated.
There's the grassroots-level engagement popping up in the most unexpected of places, and the acknowledgment - oft grudging - from hallowed international organizations. National leaders are reading up; Savvy countries, Singapore included, are not-so-quietly positioning themselves. South Korea has admitted that it's impossible to ban crypto exchanges, and their chaebol are joining in. Goldman Sachs traders are quitting for blockchain startups, while Russian nuclear scientists are mining alongside local Ah Beng BBFAs. The New York Stock Exchange's owners are integrating Bitcoin, even as it gains the thumbs-up from Muslim clerics. And, let's be frank, crypto's got to be tempting to anyone who has beef with the US Dollar, or whose own fiat currencies are crashing - and there's plenty of both to go around.
There is a sociological concept called the community of practice - defined by the people that share a collective interest. This, then, might be a partial solution to the "what underpins Bitcoin's value?" puzzle. Previous famous fads, other than involving items unsuited to be stores of values - tulips rot, beanie babies can be endlessly produced, etc - have arguably never captured such a diversified and robust community. This community has exploded with each bubble, and shrunk as the bubble deflates, but the main point is: by all indications, it has grown with each bubble cycle, and there are now millions who "get it"; and yet, this remains a tiny fraction of the available global population.
E-mail? What's wrong with pen and paper?
The resistance to digital cryptocommodities, from my observations, have been strongest amongst the old set. Recall, granddaddy Bitcoin has just celebrated its tenth birthday - there are Silicon Valley startups that have been in stealth mode for longer than that. Today's teenagers have shown themselves to have fewer hang-ups about adopting alternative forms of money, and why not, given how the wiseguy seniors have f**ked their economic future up? If one needs more convincing, the Bitcoin subreddit is nearly twice the size of r/investing, and the CFA exams are including crypto and blockchain topics. Does this look like something that will fade quietly into the night?
- MakeTotalDestr0i, r/bitcoin
The emergence of Bitcoin and other cryptocommodities has slowly garnered some respect in academia, with polytechnics and universities, and journals of the stature of Science publishing policy op-eds. However, while originally mainly a technical breakthrough in computer science (Byzantine consensus), Bitcoin's largest significance is arguably in economics: is it possible for a major money to be viably supported by a community of practice, instead of an issuing nation-state?
The more traditionally-trained, doubtless, would insist the negative - to them, Bitcoin has no possible plausible premise, and its very existence refutes the Efficient Markets Hypothesis itself. To this, we might attribute a forgivable deficit in imagination. Their almost-religious vehemence towards crypto's empirically-observed growth however cannot help but remind me of Galileo's whisper after being forced to recant by the Church: "And yet it moves!". Personally, one might next remember Planck's quote about science advancing one funeral at a time.
I for one am willing to state that cryptoeconomics will become a recognized part of economics, as new generations of econs professors struggle to deny crypto's survival - and perhaps as pertinently, get invested in it. As explained in last year's AGM, Bitcoin was never purely a replacement currency, or US Dollar #2. It is partly that, maybe, but more a commodity money.
Consider now the issues with existing fiat currencies, seldom explored with similar passion by mainstream economists. The arguments against commodity-backed (sound) money are pretty well-known: in theory, the money supply should optimally mirror the growth of the real economy. As such, fiat currencies were established to enable this, by delinking from a commodity monetary base. An obvious next question would be whether states can be trusted to manage the supply side of money properly, given their proven incompetence with the supply side of goods - see Soviet and other command economies.
One might, I hope, reasonably assume that states are, in fact, not perfectly knowledgable or disciplined, and that their issuance of fiat currency is, to some certain extent, suboptimal. This isn't an insurmountable failing, of course - people will simply organically hedge in other monies. One might plausibly explain the persistent property, stock and other asset bubbles as a manifestation of this suboptimal management of the currency supply. Now, one might not naturally associate an apartment in, say, a Chinese ghost city as the modern analogue to a Rai stone, but really, they are in practice a similar sort of "money" - citizens have limited trust in governments not to overprint and devalue the currency, and are therefore hedging with investments in a commodity that is less easily created - housing.
Both are a hard shell, with a hole in the middle...
Now, as discussed back in 2016, this "property as money" concept has generally received little pushback from states all around the world, thus the bubbles everywhere. Clearly, at least some policymakers must have realized that they were likely over-issuing currency through quantitative easing - and to the already-wealthy - as the path of least resistance. Then, if this is unavoidable, real estate would be one of the best asset classes to direct the excess currency to; unlike gold and other commodities, at least the rich can't just abscond with them. Gold in particular remains heavily suppressed - to the extent of execution for hoarding - since millenia of experience in currency failures has left little doubt as to where citizens would prefer to store value, in periods of state weakness.
Cryptocommodities, however, have upended this uneasy equilibrium. Property is, ultimately, hardly a perfect "money", after all. Land, especially in desirable areas, may be limited, but as Alex Au memorably mentioned, housing itself is largely a matter of fiat - developers can usually just build a taller high-rise structure, and/or shrink the units. Gold, the self-named standard for eons, is heavy, and adulterated coins are not easily assayed. Many other commodities are perishable, or have a supply that is highly manipulatable. Enter Bitcoin: scarce, durable, portable, fungible, infinitely divisible for all intents and purposes, non-counterfeitable with simple precautions, reliable supply schedule. That it happens to excel in all these classical dimensions of "money" is no coincidence - it was designed this way.
And so, for all the spluttering insistence by certain respected economists that Bitcoin should have zero value because it has no premise, traders and practitioners holding actual power - and facing actual consequences - have been rather less confident of avoiding a crypto-inspired monetary revolution. As explained last year, national policymakers continue to confront the dilemma of legitimizing crypto but losing some state control over money, or banning it and losing out on its economic benefits. As expected, the larger and more authoritarian the state - China probably the biggest example - the less welcoming they have been. On the other end of the spectrum, nimbler navigators like South Korea, Switzerland and Singapore aren't waiting to get in.
With official blockchain versions of national currencies thus gaining relatively little uptake, given that they don't actually fill a new niche in the money landscape, there have only been so many countermeasures to slow the migration, given that stopping crypto itself would be about as difficult as blocking the entire Internet. The entry and exit points where fiat is exchanged for crypto has been a natural bottleneck, oft enforced by regulating exchanges. Other than this, financialization and rehypothecation - where exchanges or other institutions claim to have additional coins on their internal books - is probably the gravest danger. Fortunately, longtime crypto hodlers should recognize that if one doesn't have the keys to their crypto on the de-facto settlement network itself, they don't actually own it.
The real fun, I gather, will begin when crypto becomes officially legitimized - say, when some big central bank declares that they're storing Bitcoin as a reserve asset; I'd pay good money to watch Krugman's - or other similarly-minded big-shot economists' - reaction to that. It would, certainly, be interesting to observe how opinions on crypto might change among normal citizens, if the only real difference were backing by some authority, instead of current barely-disguised disdain. It wasn't that long ago that exposed ankles were immoral, after all...
The Power/Proof of Work Argument
Of all the arguments against Bitcoin's ascendancy that I have come across - many actually anticipated by Satoshi and friends in the original conception - the most convincing was probably that on its energy cost of production. Just to reiterate, the Bitcoin mining proof-of-work algorithm automatically adjusts itself to produce one block - with associated block reward, currently 12.5 Bitcoin - every ten minutes on average. The energy expended at equilibrium is then equal to the expected revenue; assuming a price of US$4000 per coin, about some US$50000 worth of energy should be spent every ten minutes, regardless of miner efficiency. It gets slightly more complicated since the cost of energy differs according to location, but this is the general idea.
We have explained this expenditure of energy as the "price of honesty" for a commodity token previously, but it is easily understood why detractors might consider this mechanism as "insanely wasteful". According to a recent paper in Nature Climate Change, "Bitcoin usage, should it follow the rate of adoption of other broadly adopted technologies, could alone produce enough CO2 emissions to push warming above 2 degrees Celsius within less than three decades". The environmental angle, from personal experience, has become the go-to objection against crypto.
One reaction is, of course, to move towards proof-of-stake and other algorithms that do not rely on work produced, as Ethereum is planning. The thing, though, is that these alternatives are generally not trivial to secure, as might be explained in more depth later. Even considering the current situation of Bitcoin, however, there are several additional mitigations even considering likely faulty math in initial estimates. A first is that, while seemingly large in isolation, even more energy is being spent on less-worthy causes. Another is that the cost of mining, by virtue of reward halvings, naturally halves every four years. In other words, Bitcoin can double in price every four years with no change in energy expenditure. Not only that, by the nature of Bitcoin mining, it tends to migrate to places where energy is cheapest, and would not be stored elsewise anyway. Such sources are often naturally renewable - e.g. Iceland - and crypto can in this sense be seen as a buyer of last resort for electricity, unlike with other commodity monies.
[To be continued again...]
Me: Ho hum, another media exposé on our local universities' obsession with KPIs and rankings causing academics to quit, promptly sent down the memory hole; same for the HWZ forum gossip. This sort of censorship's getting more and more insidious everywhere, what with CBS News "fact-checking" the current POTUS's national address, only to delete confirmation of his apparently most outrageous assertion on migrant women victims, when it turned out to be a gross understatement if anything. How does one trust the media in this climate?
Ah, you're early, Mr. Robo.
Mr. Robo: *sitting down* Not too much good news on the investment front for the firm of H.L. Ham in 2018, I'm afraid. Hedged a lot less that we should have.
Me: Oh, that's not a huge problem - I'd say our major thesis remains intact, but we'll get to that in the meeting proper. But just curious, Mr. Robo - what do you think the point of gathering wealth is? Or, what's in it for you?
Mr. Robo: Ah well, my stake in the firm's not that big to begin with, but there's the challenge, I suppose. And, as you once mentioned, the relative transparency and independence - make your call, and next to nobody can just pull rank to tank your decision. As for the money itself, well, I've taken to thinking of it as some form of potential energy, after trying to make my way through Mirowski's More Heat than Light; modern economics has drawn heavy inspiration from physics, and if you carry the analogy deeper, the application of cash is no more than that of a force: neutral in itself.
Me: Yep, there's the Tale of Thales again - there is some satisfaction, even for those who consider themselves philosophers first and foremost, to demonstrate their ability in more... worldly affairs. Ability that, ideally, derives from some more-involved theory. As for the eventual dispersal of the loot, I'd say Maimonides might make a good guide:
Mr. Robo: So the less recognition obtained, and the more pro-active and purer the intent, the better, it seems. A fairly common concept across religions, I think, though to be frank I wouldn't have thought that you amenable to the source...
Me: *wags finger* Nuh-uh, hamster. I'm against the illogical bits, like the pick-us-only-or-fry mentality - but today's not the time for that discussion. Anyhow, an implicit addendum to Maimonides would be that a grudging gift remains superior to piety without giving - i.e. thoughts and prayers - of course assuming that one has the means. I can get behind that.
This is also entirely in keeping with your conception of wealth as a resource towards bringing about a desired change. Capitalism remains the worst method of allocating resources, it seems, other than everything else that has been tried, at least at scales larger than a tight-knit clan group. On objective inspection, much of the world's ills can be - indeed, are possibly most appropriately - mitigated by judicious use of moolah. And if so, if one believes oneself to be a decent farmer and steward, so to speak, does it make sense to give away all one's seedcorn?
That was quick
Mr. Ham: *waddling in* You got that, human. Can't give what you don't have, my pa always said, whatever the commies try to argue. A plump portfolio's the difference between making a difference and sitting with your bits in your paws, he said!
Me: Ah, the prodigal CEO returns. So, as I was discussing with Mr. Robo, why exactly do you wanna be rich?
Mr. Ham: Three chicks at once.
Me: ...okay, cancel the scheduled shareholder address. We might have some editing to do.
Nothing New Under The Moon
Me: Well, I'm sure neither of you need a play-by-play of the painful details. Long story short, we were inaccurate. It was, again, a bubble. On this, we were wiser and more circumspect in 2014. However, a pronouncement that "we think it unlikely that Bitcoin's price will fall to one-fifth its current value, which is harder to vouch for for most alts" has just about come to pass, considering Bitcoin's price of some US$16500 - if highly unstable - then, compared to about US$3700 today.
This drop has, as expected, brought eager naysayers out of the woodwork, with prominent critic Nouriel Roubini observing that cryptos are rather less decentralized than advertised. Others have resummoned old critiques about a lack of value tethering - see our previous rebuttal - and resemblances to tulips, beanie babies, Pokémon collectible cards and the South Sea Bubble. Some have at least, while celebrating the collapse in price, acknowledged that the price remains, like, forty times that of five years ago despite the crash - or an annual 100+%, compounded. Surely then, if this is accounted a failure, where might we encounter a whole lot more of it? Not even Google or Berkshire Hathaway have anything on this rate of growth. It can be hard to maintain proper perspective, considering the current price remains 4x that of two years ago, right on trend.
An interesting consideration here is that, the older the hand, the more fortified they tended to be about these developments. We drew upon the experience of 2012 back in 2013/2014 ourselves, and the biggest surprise might be how closely 2017/2018 repeated that period, and the classic bubble chart to boot:
Complete with prescribed bull trap both times,
after the implacable run through 2017
Mr. Ham: Spooky, maaan.
Me: The psychology does seem empirically solid, and while I didn't discount a drop, I must confess I didn't see it repeating an 80+% retrace. But to reiterate, the main takeaway should be that virtually none of the critiques about Bitcoin are new. Almost all of them had been accounted for on the BitcoinTalk forums before 2012, back when discussants were nearly without exception thoughtful technical enthusiasts - who tend towards Bitcoin maximalism, and for good reason - instead of the loudmouthed get-rich-quick shills that populate r/cryptocurrency and the like nowadays - many of whom have gotten badly burnt. As for the participants, the discussion content from when prices were soaring/diving about 2014, can hardly be distinguished from the corresponding threads four years on.
Mr. Robo: The question is then, is there anything significantly changed about the crypto scene, from 2014 to 2018, or will it be roughly the same pattern all over again?
Me: Right on. A fresh critique is then that, instead of being five years old then, Bitcoin had become nine years old, and thus expected to be more mature. Well, to this, one might suggest that a some 20x jump in maximum price might qualify, the 341st declaration of Bitcoin's demise notwithstanding. Keeping in mind the old hat about past performance and future results, the recent price action has supported theoretical projections about Bitcoin price growing by bubbles - with more to come.
No, as we hinted in our last AGM and before, it all reduces to a single question: is crypto the future of money, as the Internet was the future of information? If no, then the critics will be right, and they can smugly regale captive audiences about how it was all obviously smoke and mirrors; if yes, however, then one might consider the various dot-com busts - and wonder at what, say, the next twenty years might bring...
Listen here, son. It might hurt, but you HODL THE LINE, you hear me?
'Cause you neva know when the BIG BULL appears.
[To be continued...]
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