LOL! German Central Bank Warns Not To Use Bitcoin As It Is Not Backed By A Central Bank


🤣  This gives me more reason to jump right into Cryptocurrency ‼️


DV

May 13, 2017 by

Central banking, which is a tenet of communism and a scheme to impoverish the many to benefit a few, is one of the evilest, most pernicious and rapacious entities on Earth.

So, when a member of the German central bank, Bundesbank, warned against buying bitcoin I almost choked on my wiener schnitzel.

Having a central bank warn against buying bitcoin is like a rapist warning you that sex with your spouse isn’t as exciting as when he rapes you.

Yes, we know… and that’s why most people prefer not getting raped… and why we prefer bitcoin over any central banking scrip.

Here is what Carl-Ludwig Thiele, a Bundesbank board member said:

“Bitcoin is a means of exchange which is not issued by a central bank, but by unidentified actors. I do not see it as a currency. If you think Bitcoin would be as safe as the euro or the dollar, you have to take responsibility for it. We can only warn people not to use the bitcoin to preserve purchasing power.”

It comes as the height of arrogance to warn now, with bitcoin at all-time highs near $1,800, that bitcoin is a bad currency to “preserve purchasing power.”

If you had bought $1000 USD worth of bitcoin back in 2011 at $3, it would now be worth roughly $566,000.

If you had $1,000 USD in 2011, it would still be “worth” $1,000, but that $1,000 would only buy about $913 worth of goods. And that is when calculating the depreciation with the government’s own CPI index of 1.34% per year which has no bearing on reality. It is much higher than that.

If you had bought $1000 USD worth of euros in 2011, you’d now have $859 worth of euros considering the January 2011 USD exchange rate of .748 Euro per dollar.

So, with dollars, you would have lost roughly 1.34% per year due to inflation and with euros, you lost a whopping 5% due to the drop in the value of the euro and even more if inflation is considered. And, with bitcoin, your purchasing power increased by 56,500%.

So, clearly, you can see why the German central bank is warning against holding bitcoin. Because if everyone held bitcoin we’d all be rich and there would be no German central bank for Carl-Ludwig, that Keynesian communist, to “work” at.

Let’s compare bitcoin to central bank issued fiat currency to show further how ludicrous Thiel’s statement is:

Across Europe and the US, the economies are falling apart as the middle class is wiped out and tens of millions are pushed into poverty by the direct actions of the central banks.

Minimum wage protests continue because people are finding that the central bank’s inflation has made it so they can barely afford to eat anymore.

Meanwhile, the value of bitcoin continues to increase. Had everyone had bitcoin for the last few years there’d be no poverty and no strife.

The euro has fallen 99.75% versus bitcoin since 2011. This is what the German central bank is warning you about.

We suggest you ignore anything that the government, central banks and mainstream media tell you. All three of them are centralized and archaic and are in the midst of being washed away by a new paradigm of non-violent, decentralized systems of which bitcoin is one.

Most of the world hasn’t realized this evolution is in process, though, so you can still get in and well-positioned before the crowd and potentially realize a fortune for doing so.

You can get access to our book, Bitcoin Basics, and our newsletter that covers this ongoing paradigm shift here.

I’ll wager with Carl-Ludwig Thiele that bitcoin outlasts both the US dollar and the euro. In fact, I’ve predicated my life’s work around it here at The Dollar Vigilante.

Central banking is so 20th century. It’s time people like Carl-Ludwig Thiele disappear. In fact, why is the Bundesbank even still around? It essentially does nothing now that the counterfeiting power and interest rate market manipulation are committed by the European Central Bank.

Poor Carl-Ludwig, he doesn’t even know he is already obsolete.

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Epic Fail: 100 Years of the Fed


FEE

….so so many analysis and investigations have been done on the failures of the Bretton Woods‘ financial and monetary system that I’m tired of reading the never ending reports. We’ve come to the tipping point to witness its collapse…contrary to popular views and beliefs of the ‘financial experts’, I’ve come to the conclusion that the term ‘failure’ is a misnomer. It would (of course) seemed as failures when seen from ‘inside-the-box’ by ‘blinded experts’, educated and trained by the perpetrators themselves. Taught one thing but practiced the opposite. That’s why the ‘experts’ are filled with aghast with their findings and could only offer “inside-the-box” solutions which are meaningless and counter-productive. Most economists today, however, have sold themselves to the enemy. The system was formulated by dirty banksters with agendas to suit and enrich themselves and gain control of the people on this planet. These scumbags know too well that it wouldn’t last forever and when its time (like it is now) they would collapse it…all by design, and then…start another one (yes! BRICS)!. The only way to stop this nefarious program is to get rid of it log, stock and barrel.

“Banking was conceived in iniquity and was born in sin.”Sir Josiah Stamp, President of the Bank of England in the 1920s

The Fed

How monetary nationalism wrought havoc, but cryptocurrency can save us

DECEMBER 17, 2014 by JEFFREY A. TUCKER

The most surprising monetary innovation of our time is bitcoin, a privately produced digital currency and payment system. It is a global system that provides a dramatic alternative to central banking and monetary nationalism as we know it. As with other innovations, such as email and texting, it could challenge the dominance of government policies.

What will we lose if the private system replaces the government-managed one? A look at the history of central banking — and the theories behind the history — shows that we only stand to lose a system that has proven unworkable and dangerous in every way. As government management has been for the mail, education, health care, and every other sector, so has it been for money.

Modern central banking began a little more than 100 years ago. Economists and elite political figures became enamored with the prospect of a perfect money and banking system. They believed that if they could gather the smartest minds, give them vast resources, and put the power of capital and government behind them — jettisoning competitive uncertainties — America could finally stabilize a monetary system that had vexed the developed world for the previous 50 years.

Looming large in their minds was the great panic of 1907, which had come out of nowhere to lead to massive bank failures, tumultuous real estate prices, and job losses as far as the eye could see. All elite opinion — which you can read about in the academic journals of 1908 through 1914 — promised a solution. They would bring science to the problem of money management.

Scientific naïveté

This was the first stage, the period of scientific naïveté. If science could bring flight, internal combustion engines, and breakthroughs in medicine and psychology, surely it could do the same for a new field called “monetary policy.”

Those who argued this way meant that monetary science needs government power. This power would permit the manipulation of interest rates, provide a clearing system to immunize banks against failure, put a stop to private production of money and “wildcat banking,” and coordinate bank policy with national economic policy. The goal was to control inflation, smooth business cycles, and stop systemic upheaval.

Central banks were created throughout the world, especially in the emergent empire of the United States. The Federal Reserve was born — and opened for business November 16, 1914 — as a better and more stable embodiment of the national banks of the 19th century.

The Fed Founders

The founding board of governors

What central banking actually did (which very few of its proponents realized it was doing at the time) was give government a blank check to do whatever it wanted without having to achieve that gravely difficult task: taxing its citizens. It created a cartelized, government-managed system that could issue debt, immunize that debt from a market-based default premium, create money, and grow itself to achieve the dreams of the political and financial elite. Suddenly, and for the first time in modern memory, there were no limits to what was possible with public finance.

Somehow, most economists hadn’t entirely realized the implications.

Funding the Great War

This first stage directly led to the shocker that few among the previous generations ever expected: World War I. As the economist Benjamin Anderson pointed out a few years after the peace, it was central banks in the United States, the United Kingdom, and Europe that made it all possible. Had this free-money spigot not been available, governments would have relied on the traditional mechanism of diplomacy to achieve peace, as opposed to a war they could not afford. Central banks became the “occasion of sin” that tempted governments to act in ways they otherwise would not have.

It wasn’t the case, as the textbooks often say, that the Great War “interrupted” the progress toward rational economic policy; rather, the new monetary institutions tempted governments to do something they otherwise might not have done. Central banks became the enabler of a most unwelcome horror.

The Great War was the first “total war.” It involved the whole developed world. It was accompanied by a universal draft, censorship, financial controls, and a suspension of the gold standard. It drew civilians into the conflict on a scale never before seen in the history of humanity. It employed poison gas, air bombings, and weapons of mass destruction that would have been previously unthinkable.

The resulting inflation led to revolution in Russia, central planning and price controls in the United States, and the first glimpse of modern despotism in Europe and England. The semblance of democracy replaced monarchy, government rule replaced markets in most countries, and new forms of political rule displaced old-world empires.

Most significantly from an economic perspective, the result of the war was massive debt accumulation, which meant that someone, somewhere had to pay. Governments’ debt obligations led to dramatic fiscal tightening in the early 1920s, giving way to the final stage of credit expansion in the mid to late ’20s.

In Germany, where the debt obligations and strict terms of peace were severe, the result was an incredible calamity: the Weimar inflation of 1921–23. This stage of stunning upheaval paved the way for the rise of Hitler as a demoralized and destroyed social order cried out for an iron hand. In the United States and Europe, there was Black Tuesday and the beginnings of the Great Depression. Just as a drinking bout leads to a hangover, the inflations of the 1920s created the conditions of the Depression.

The first wave of Keynesianism

Rather than recognizing the failures of central banking, the elites doubled down with new peacetime measures of central planning. This might be called the first wave of Keynesian economics. Remarkably, governments pursued what we now call Keynesian policies long before John Maynard Keynes released The General Theory, his magnum opus, in 1936. His book recommended inflationary finance, high government spending, and macroeconomic manipulation — precisely what governments were already practicing.

American schoolkids are taught every day that the New Deal saved the country from the Great Depression, which is false on the face of it given that the Great Depression lasted from 1930 all the way to US entry into World War II. The war intensified the privation.

Also contrary to what kids are taught in schools, the Federal Reserve during the Depression’s early years was not pursuing laissez-faire policy. The Fed was pushing down interest rates and manipulating reserve requirements in hopes of spawning a new inflation, which it failed to achieve due to a massive drop in velocity (a dramatic increase in the demand for cash). Both presidents Hoover and Roosevelt used government power to manipulate the system. Roosevelt devalued the dollar and even banned the private ownership of gold. He tried to patch the system with deposit insurance. Still, the hoped-for monetary stimulus did not arrive.

The second wave of Keynesianism

Following World War II, which was funded (like the first one) through debt issuance backed by inflationary finance, Keynesian theory was at new heights in terms of academic economic opinion. This was second-wave Keynesianism. Keynes himself was present at the 1948 Bretton Woods conference, which attempted to create a new global currency and a global central bank, even as the veneer of the gold standard were preserved. This system was obviously unsustainable, and it eventually collapsed in 1971.

The 1950s and 1960s saw the advent of a new system of social welfare, the Cold War of endless military buildup, regional military interventions in Vietnam, and an ever-larger expansion of government into the lives of citizens — all made possible by the blank-check policies of central banking. Had states had to depend on taxes and unsecured debt alone, none of this would have been possible. There would have been no debates and riots over war and the Great Society, because neither could have been funded out of taxes and unsecured debt alone.

It’s remarkable to consider the amazing failure of the intellectual class to see the errors of Keynesian policy in those days, but it was blind to them. The widespread opinion was that the only remaining problem in the world monetary system was the presence of gold, which was finally tossed out completely with the reforms of Richard Nixon. He closed the gold window in 1971 and introduced the age of fiat money in 1973 as the final step in bringing “science” to monetary policy.

Continue reading at FEE

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Bitcoin Just Completely Crashed As Major Exchange Says Withdrawals Remain Halted


Business Insider – Malaysia

bitcoinscreen shot 2014-02-10 at 5.53.50 am

Bitcoin just completely fell out of bed.

The chart above shows the move.

The news comes as major trading exchange Mt. Gox says that withdrawals remain halted.

The letter is long, but here’s the conclusion:

Conclusion

To put things in perspective, it’s important to remember that Bitcoin is a very new technology and still very much in its early stages. What MtGox and the Bitcoin community have experienced in the past year has been an incredible and exciting challenge, and there is still much to do to further improve.

MtGox will resume bitcoin withdrawals to outside wallets once the issue outlined above has been properly addressed in a manner that will best serve our customers. More information on the status of this issue will be released as soon as possible. We thank you for taking the time to read this, and especially for your patience.

And here’s the full letter:

Dear MtGox Customers and Bitcoiners,

As you are aware, the MtGox team has been working hard to address an issue with the way that bitcoin withdrawals are processed. By “bitcoin withdrawal” we are referring to transactions from a MtGox bitcoin wallet to an external bitcoin address. Bitcoin transactions to any MtGox bitcoin address, and currency withdrawals (Yen, Euro, etc) are not affected by this issue.

The problem we have identified is not limited to MtGox, and affects all transactions where Bitcoins are being sent to a third party. We believe that the changes required for addressing this issue will be positive over the long term for the whole community. As a result we took the necessary action of suspending bitcoin withdrawals until this technical issue has been resolved.

Addressing Transaction Malleability
MtGox has detected unusual activity on its Bitcoin wallets and performed investigations during the past weeks. This confirmed the presence of transactions which need to be examined more closely.

Non-technical Explanation: 
A bug in the bitcoin software makes it possible for someone to use the Bitcoin network to alter transaction details to make it seem like a sending of bitcoins to a bitcoin wallet did not occur when in fact it did occur. Since the transaction appears as if it has not proceeded correctly, the bitcoins may be resent. MtGox is working with the Bitcoin core development team and others to mitigate this issue.

Technical Explanation:
Bitcoin transactions are subject to a design issue that has been largely ignored, while known to at least a part of the Bitcoin core developers and mentioned on the BitcoinTalk forums. This defect, known as “transaction malleability” makes it possible for a third party to alter the hash of any freshly issued transaction without invalidating the signature, hence resulting in a similar transaction under a different hash. Of course only one of the two transactions can be validated. However, if the party who altered the transaction is fast enough, for example with a direct connection to different mining pools, or has even a small amount of mining power, it can easily cause the transaction hash alteration to be committed to the blockchain.

The bitcoin api “sendtoaddress” broadly used to send bitcoins to a given bitcoin address will return a transaction hash as a way to track the transaction’s insertion in the blockchain.
Most wallet and exchange services will keep a record of this said hash in order to be able to respond to users should they inquire about their transaction. It is likely that these services will assume the transaction was not sent if it doesn’t appear in the blockchain with the original hash and have currently no means to recognize the alternative transactions as theirs in an efficient way.

This means that an individual could request bitcoins from an exchange or wallet service, alter the resulting transaction’s hash before inclusion in the blockchain, then contact the issuing service while claiming the transaction did not proceed. If the alteration fails, the user can simply send the bitcoins back and try again until successful.

We believe this can be addressed by using a different hash for transaction tracking purposes. While the network will continue to use the current hash for the purpose of inclusion in each block’s Merkle Tree, the new hash’s purpose will be to track a given transaction and can be computed and indexed by hashing the exact signed string via SHA256 (in the same way transactions are currently hashed).

This new transaction hash will allow signing parties to keep track of any transaction they have signed and can easily be computed, even for past transactions.

We have discussed this solution with the Bitcoin core developers and will allow Bitcoin withdrawals again once it has been approved and standardized.

In the meantime, exchanges and wallet services – and any service sending coins directly to third parties – should be extremely careful with anyone claiming their transaction did not go through.

Note that this will also affect any other crypto-currency using the same transaction scheme as Bitcoin.

Conclusion
To put things in perspective, it’s important to remember that Bitcoin is a very new technology and still very much in its early stages. What MtGox and the Bitcoin community have experienced in the past year has been an incredible and exciting challenge, and there is still much to do to further improve.

MtGox will resume bitcoin withdrawals to outside wallets once the issue outlined above has been properly addressed in a manner that will best serve our customers.

More information on the status of this issue will be released as soon as possible.

We thank you for taking the time to read this, and especially for your patience.

Best Regards,
MtGox Team

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