Fancy that!

For about a year now, as a mental exercise, I have tried to think and, more importantly to feel in my gut, differently about my meager pension and bank savings.

I have never paid much attention to daily news reports about the fluctuating prices of stocks, or bonds, or mutual funds, or real estate, or commodities. I've never owned much of any of them except for a share in our house.

My miserably few savings are sitting at the bank, in simple cash, as an ordinary expense account.

What I began doing, however, in June 2011, is to 'virtually' track the value of that bit of cash as if I had cleverly converted it into gold and bitcoin back then, in June 2011.

As the months creep by, I've been intrigued to notice that my wee bit of capital, had I allowed it to simply stagnate as inert gold and electronic bitcoin, would now be worth quite a few more dollars.

Conversely, my little pool of hard earned cash, even including accumulated interest, could not possibly buy the amount of gold or bitcoin it could have in June 2011.

Fancy that.

Beware the Bull about Bitcoin

There is a lot of sloppy thinking going around these day concerning digital currency.

Any unethical or amoral use of any unit of exchange says absolutely nothing about the unit itself and everything about the user and the person reporting on that use. Cash, silver, gold, diamonds & digital currencies are all units of value that can be used to purchase things.

The fact that you can buy drugs, porn and assassinations with most currencies is utterly beside the monetary point. No real currency was designed for such a single purpose. Even Canadian Tire 'money' can get you a discount on thousands of different products. A trusted currency can be used to buy everything from socks, to computers, to mining shares. It is only intended to flow through efficient networks of exchange, secured by the trust of the parties.

Reliable money also maintains its value through an economic crisis, offering an indirect critique of weaker alternatives and even of our whole banking system, but no currency, in and of itself, expresses a moral position, or advocates more ethical behaviour.

The best monetary agreements strive for the following characteristics: (1). Transactions can be anonymous (2). Sending money is instantaneous and free (3). Users can memorize and keep secret the information needed to access their money, or store it on paper in a vault (4). No change or transaction in that currency can shut down the entire global economy.

This all seems reasonable and works very well providing each of us is free to choose and use whichever currency we trust most.

That is why it is going to become crucial over the next few years that we all realize that only weak currencies, weak governments, or weak banks feel threatened by any currency more trusted than their own.

So, next time you hear Chuck Schummer, Joe Lieberman, Hillary Clinton, or any purported defender of national security or morality argue that digital currencies such as Bitcoin, or the Canadian Mint's proposed new MintChip, are dangerous or need to be outlawed, know beyond a shadow of doubt they are only trying to prop up their own cash, or vested interests in a mistrusted or collapsing currency.

(Adapted from a blog post by 'Daniel' at: http://moneydick.com)

China, Digital Coin and the Formerly Foreign Few

Even the most prestigious journals, purporting a global perspective, continue to ask such ludicrous questions as "What can the West offer Chinese Banks"?. They worry that with the current state of western finance, Chinese banks will stick to their domestic market for now rather than use their huge cash reserves to bail out western currencies.

How much longer will the press persist in this silly narrative based on national boundaries and vertical expressions of sovereignty as if they were still a useful framework for understanding human financial affairs.

In this day and age, almost any use of the word 'domestic' when discussing world trends should be challenged.

Take the so-called Arabian Spring for example. It epitomizes the transition away from vertical towards horizontal perceptions of loyalty.

With every passing month, more people are applying this new perspective to the realms of banking and finance and, with it, their awareness of how the current use of money is sucking all the world's wealth upwards into an inverted funnel towards fewer and fewer communities of obscene wealth and privilege.

I would be interested in hearing from any readers of this blog on whether you have already converted some of your personal capital into Bitcoins or some other form of digital currency outside the control of the current banking and insurance conglomerates.

Given the technical proficiency needed to host and administer this emerging alternative, it seems likely that China and other massively productive economies might be the ones to adopt and push digital coin towards critical mass. There is no better way to parley the Arabian Spring into a truly Global Economic Awakening?

Any economy that produces and grows real goods and services, as opposed to he fraudulent virtual derivatives typical of western banking, will have all it needs to begin using digital coin in a disciplined way to value and exchange those same real goods services.

With the vision and nerve to be early adopters, emerging economies could forever step outside the vicious mantra of IMF extortion: "Trap them with compound interest, milk them until endemic default, then transfer ownership to a few ('foreign') friends."