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Messages - Eddie

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Surly Newz / Re: Things That Make Me Say, "Dafuq?"
« on: October 17, 2018, 01:03:32 PM »
I'm bi on hotdogs.

I can go chili, cheese and onions, or I can got the other way and go Chicago style. I like 'em both a lot, (and I make sure to chew slowly and not eat them while breathing heavily).

In Austin, there were several excellent hot dog places a few years ago, but they seem to have fallen out of favor as everyone has gone paleo or vegan or gluten free, or some other version of healthy food. I hate that.

When in Chicago, a trip to Portillo's is good. Or Max's, which is next door to the Art Institute. My kid took me there, and they're excellent.

Surly Newz / Re: Things That Make Me Say, "Dafuq?"
« on: October 17, 2018, 10:43:47 AM »
Anybody who puts ketchup on a hotdog deserves to choke.

Just kidding. My wife tells a very scary story of almost choking to death on a hotdog when she was a little kid, and being saved by a savvy uncle.

Uncle Oscar, the dentist...LOL. No Heimlich in 1958. Just a guy willing to reach down her throat and pluck it out with his fingers, which she remembers very clearly.

Economics / Re: How Blockchain Will Rule Your World
« on: October 17, 2018, 10:26:17 AM »
Nobody said it was your problem, comrade.

I write this stuff to help anyone who is remotely interested understand the process. I know you are not interested, which is fine by me. I'm not trying to sell you anything.

At 180 views it seems to be arousing more interest than most of my rants. But I'm sure the five or six of us who come here regularly are almost certainly the only ones reading it.....but who knows.

I wasn't interested either until last week, but now I am. Okay if I keep the thread going, or would you like for me to stop?

(I secretly hope your source for candles starts to demand payment in bitcoin, could happen. LOL.)

Economics / Re: How Blockchain Will Ruin Your World
« on: October 17, 2018, 10:09:47 AM »
It's now showing up as pending on my card account, so maybe I'll get lucky. So I have to wait, and see if it goes into my account, the timing of which seems pretty unknowable.

Shrug and pray technology.

Get this. They wanted me to read this long disclaimer while holding my card so they could see it, and then when I did that, the file size was too big. I had to do it over and read really, really fast to get it under 25MB's. So incredibly silly.

All this to buy a fraction of one bitcoin. Sheesh.

Economics / Re: How Blockchain Will Rule Your World
« on: October 17, 2018, 10:00:05 AM »
There is a lot of bullshit to deal with in the world of cryptos. That's what I was getting at.

In the world of penny stocks, some online brokers don't handle certain stocks. i ran into that with some of the Canadian pot stocks. But at the  very worst, it was never a tenth as bad as crypto.

You should be able to have one account, but that doesn't work unless you just want to own bitcoin alone, which wouldn't be the way to go these days.

I have now tried to buy some bitcoin for the fifth time, and I've been waiting for a half hour to see if it went through. My guess is no.

Economics / Re: How Blockchain Will Rule Your World
« on: October 17, 2018, 08:47:03 AM »
So, after assuring my credit union I'm not getting scammed, and after assuring the bitcoin wallet people I'm not being held hostage, I tried again.

Fourth attempt, fourth fail. I did fine until the very last step.....but this time instead of them wanting my ID , they asked me to make a video selfie reading a disclaimer and holding my credit card up so they could eyeball me and it at the same time. No shit.

By the time I figured out how to make a video selfie on my Mac (only a few minutes) the transaction timed out. Dammit! They said I could try again in 3-4 hours.

I'm sure none of this stuff is any big deal to a millenial, but to me it's very unwieldy and stupid. Fraud is the issue, of course. It's rampant in the crypto space.

One other thing I forgot to mention that is important. The fees to buy bitcoin are highway robbery. What ever you intended to spend, it'll cost you an extra 10% for the privilege of online stock broker could ever get away with fees like that. Fuckin' ridiculous.

Doomsteading / Re: The Doom Loop
« on: October 17, 2018, 08:12:37 AM »
The truth according to K-Dog is that collapse is not going to be a single identifiable event that puts us in the middle of a dystopian novel.  Collapse ultimately becomes the fate of individuals and we all have different fates.  Eventually people will starve to death in America, and for many life will become nasty brutish and short.  But this will not happen to everybody and not all at the same time to those it does.  That it be a minority of people or a majority is irrelevant.  That is only a number.  The point I wish to make is that those who suffer merely 'disappear' but civilization limps on.  National Guardsmen shooting looters will be civilization limping on.  Latifundiumi run by prison labor will also be civilization limping on.  Some have already starved and you did not notice.

Collapse has been going on for years.  After the crash in 2008 I did not get hit by it right away.  I had a contract so my job was secure until the end of my contract and then I did not work for a few years until circumstances changed.  I 'recovered' but I realize not everybody did because I came close to fading away for all time myself.  Collapse is a game of musical chairs and if you are the one left standing up you collapse.

Victims of collapse don't get to play the game anymore.  That fact means the survivors will continue to play, and play, and play.  Survivors don't rewrite the rules of the game.  Only victims could do that so the music will play for a very long time and stop many times.  One man's collapse will not happen at the same time as another's.

Katrina,  the crash of 2008, name your disaster.  Collapse has been with us for a long time and if it continues as it has we will have Archdruids ridiculous 'catabolic collapse' concept where John Greer postulates a slow contraction which will defy all rules of mathematics and human nature.

Collapse in a 'doom' sense would mean serious interruption in the oil supply.  I see oil trains sending oil to export every day.  Oil if need be will be pumped at gunpoint while society adjusts and gets rid of excess flesh.  That flesh may well be ours but after we die the great game will go on without us.

Total collapse would mean we all die.  That is not going to happen.  For more likely will be that some find a way to profit from the demise of others.  Then they write history.

At some time something serious has to happen to cause a big die-off.  That is as sure as two plus two is four.  But knowing when will be impossible to predict.  Too many variables.

Fairly profound, there Dog. I agree, and so many doomers don't get this. Just the old ones, LOL.

Surly Newz / Re: Things That Make Me Say, "Dafuq?"
« on: October 17, 2018, 07:48:45 AM »
Grandpa was a carpenter
He built houses stores and banks
Chain smoked Camel cigarettes
And hammered nails in planks
He was level on the level
And shaved even every door
And voted for Eisenhower
'Cause Lincoln won the war

            --------- John Prine

Just an excellent example that sprung to mind, of how public perceptions shape politics.

Now people vote for Democrats 'cause Lincoln won the war. It's completely changed in one lifetime. Funny how it's all about the narrative, and the reality comes in a distant second.

Economics / Re: How Blockchain Will Rule Your World
« on: October 17, 2018, 06:17:24 AM »
Apparently, buying various coins works in the following way:

You need two accounts at least, and probably more if you hold a number of different coins. Unfortunately, not any one wallet will support all the coins, which is why multiple wallets might be needed.

You need a digital wallet, first off, and that can be online or offline. FreeWallet is a site that offers free online coin wallets, and they are (apparently) fairly secure, but they retain your encryption keys, and so you have to trust their security, which seems to be good....but the most secure way to hold the coins is on your own off-line device, which means you need a wallet that supports that.

So I got a FreeWallet account and a Ledger account (which requires offline storage) and so I got their USB memory stick called a Nano S. They make a fancier one for those who have lots of coins to keep up with, but it's more than adequate, as long as you stick to the coins they support.

So, to use Ledger, you have to buy bitcoin with a credit or debit card, and then go to another exchange site to trade your bitcoin for whatever other coins you want. See how bitcoin dominates? It's a gateway to the others. For this reason, it stands to be around for a while, in spite of its older architecture, volatility, etc.

The first hurdle is getting your credit card company to let you make the transaction. I carry three, and none of them would approve a bitcoin transaction last night. Declined, all three. The company (Ledger) tells you they prefer debit cards. I see why.

Ledger also requires you to scan a photo ID, which turned out to be a major hassle, I finally got a scanned file the size they wanted, and then they still rejected the images, and I had to get my daughter to take photos with a cell phone, which is apparently the accepted way, although they don't tell you this. I wasted a couple of hours trying to get a transaction to work. so far, no luck. LOL.

But, once you have a wallet and you have successfully bought some bitcoin, you then need to go to an exchange site that meets your needs. The deal is that, once again, not all exchanges support trading in all coins, so you have to find one that will trade your bitcoin for whatever other coin you'd like to own.

When you go to the exchange site, they ask for your account info, which you have as soon as your wallet is set up. When the transaction shows up in Ledger, then I can somehow save that to my memory device. Haven't gotten that far yet. But you can trade your bitcoin for anything else, basically, and then you just store it. The storage devices can be replaced if your lose or break them. There is a lengthy series of steps to do this, but it isn't hard.

Since two of my picks are Ripple (XRP) and Tron (TRX), I chose to get an account on Changelly, which offers accounts for those coins. Some of my picks are not supported by Changelly or Ledger, so if I decide to buy some others, I have to get more wallets and more exchange accounts.

Surly Newz / Re: Things That Make Me Say, "Dafuq?"
« on: October 17, 2018, 05:23:26 AM »
None of those militias are state sponsored in any way, nor or they recognized as legitimate by any state government. They are tolerated because they are insignificant.

As I said, and I will reiterate, all races ultimately have been enslaved by the successful federal government coup that was afforded by the circumstances of the Civil War. Check your pay stub.

Surly Newz / Re: What percent of Americans are rational?
« on: October 16, 2018, 01:13:13 PM »
What percent of Americans are rational?

What percent of Americans are rational?

Preface. Why does rationality matter — what’s the harm in believing there’s a fat old “Santa Claus” God in the sky noting down every time you’re naughty or nice on trillions of inhabited planets in the universe every second of the day, and has been for trillions of years? There’s no harm at all, people have always believed odd things.

But that’s not always true. Evangelists are trying to force the rest of us to see the world their way and voting for totally irrational people. They and others who can’t tell fake from real news and believe in conspiracy theories threaten Democracy and consequences could be as high as launching nuclear weapons.

For example, 81% of evangelicals voted for Trump and they are 26% of voters. No other religious or non-religious group delivered as many votes to Trump: 42 million (mainstream Christians 27.8 million, white Catholics 16.8 million). And this despite knowing he stiffed thousands of workers, grabbed women’s asses, hung out with gangsters, which should have resulted in losing his casino license, laundered money for the Russian mafia, and much more (Johnson 2016).

Andersen (2017) estimates that only a third of us are more or less solidly reality-based.

The polls below show Andersen may be too kind. One poll concludes that only 27% of us are rational.

It may be even less than that, because there isn’t any survey that covers paranormal, supernatural, and basic knowledge of the world. For example, the National Science Foundation survey of basic knowledge of the world found that 26% of Americans think the sun revolves around the Earth, and only 48% in evolution — that human beings developed from earlier species of animals.

Alice Friedemann [url=][/url] author of “When Trucks Stop Running: Energy and the Future of Transportation”, 2015, Springer and “Crunch! Whole Grain Artisan Chips and Crackers”. Podcasts: Derrick Jensen, Practical Prepping, KunstlerCast 253, KunstlerCast278, Peak Prosperity , XX2 report ]

What percent of Americans are rational?

In a really strict sense none of us are 100% rational due to cognitive biases, framing effects, fallacies and so on (wiki lists over 250 of these). To be human is to be irrational. But we’re all capable of improving our critical thinking skills and our understanding of the world.

So I’ll stick with the paranormal, pseudoscience, scientific knowledge, and conspiracy beliefs.

A Gallup poll in 2005 found that “Three in four Americans believe in Paranormal”, and found that 73% believe in one or more of these: ESP, Haunted Houses, Ghosts, Telepathy, Clairvoyance, Astrology, communication with the dead is possible, Witches, reincarnation, Channeling. Only 27% of Americans thought none of them were true.

And it might have been even lower if irrational beliefs had been expanded to include conspiracy theories, scientific understanding, evolution, climate change, creationism, the Devil, Hell, angels, miracles, and other beliefs.

Paranormal and supernatural beliefs.

Multiple numbers reflect results from several surveys:

  1. Angels: 77%, 72%, 72% 88% of Christians, 95% of evangelical Christians
  2. Astrology: 25%, 26%, 29%
  3. Channeling: 9%
  4. Civil war wasn’t about slavery but states’ rights: 48%
  5. Climate Change not due to man-made activities: 40%
  6. Clairvoyance: 26%
  7. Communication with the dead is possible: 21%
  8. Creationism: 36%
  9. Devil: 61%, 60%, 58%
  10. ESP: 41%
  11. Ghosts: 34%, 42%, 42%
  12. Haunted Houses: 37%
  13. Heaven: 71%, 75%
  14. Hell: 64%, 61%
  15. Jesus born of a virgin: 73%, 61%, 57%
  16. Jesus is God or son of God: 73%, 68%
  17. Jesus’s resurrection: 70%, 65%
  18. Life after death: 71%, 64%
  19. Miracles: 76%, 72%
  20. Reincarnation: 21%, 20%, 24%
  21. Sun revolves around the Earth: 25%
  22. Telepathy: 31%
  23. UFOs: 34%, 32%, 36%, extraterrestrial beings have visited 24%
  24. Vaccines cause autism: 56%
  25. Witches: 21%, 23%, 26%

Conspiracy theories (Chapman 2016)

So what is a conspiracy theory? It’s (1) a group (2) acting in secret (3) to alter institutions, usurp power, hide truth, or gain utility (4) at the expense of the common good.

There’s no way to stereotype people who believe conspiracy theories, they exist across gender, age, race, income, political affiliation, educational level and occupational status.

Education makes a difference though. 42% of those without a high school diploma had a high predisposition to conspiracies. A much lower, but still shockingly high 23% of those with postgraduate degrees also had a high disposition for conspiratorial beliefs (Uscinski 2014).

Only 26% of Americans disagreed with all 9 conspiracy theories below, and 33% even believed in a made-up conspiracy researchers called “The North Dakota Crash”. The percent who said that the government is concealing what they know about….

  1. The 9/11 attacks 54.3%
  2. The JFK assassination 49.6%
  3. Alien encounters 42.6%
  4. Global warming 42.1%
  5. Plans for a one world government 32.9%
  6. Obama’s birth certificate shows he’s a foreigner 30.2%
  7. The origin of the AIDs virus 20.1%
  8. Death of supreme court justice Scalia 27.8%
  9. The moon landing 24.2%

People who believed in the highest number of conspiracies are also more likely to believe that “The World Will End in My Lifetime” (uh-oh, those evangelists again), as well as more likely to be fearful of government, less trusting of other people, and more likely to take actions such as buying a gun to overcome their fears.

National Science Foundation Questions 2014

The questions below are followed by correct answer and the percent who got it right:

  1. The center of the Earth is very hot. True 84%
  2. The continents have been moving their location for millions of years and will continue to move. True 83%
  3. Does the Earth go around the sun, or does the sun go around the Earth? Earth around sun 74%
  4. All radioactivity is man-made. True or false? False 72%
  5. Electrons are smaller than atoms. True or false? True 53%
  6. Lasers work by focusing sound waves. True or false? False 47%
  7. The universe began with a huge explosion. True or false? True 39%
  8. It’s the father’s gene that decides whether the baby is a boy or girl. True or false? True 63%
  9. Antibiotics kill viruses as well as bacteria. True or false? False 51%
  10. Human beings, as we know them today, developed from earlier species of animals. True or false? True 48%

Not surprisingly, the higher the education level the greater the number of correct answers.

The world

Below is a poll of over 17,000 adults all over the world (Ipsos 2017) asking if they think that Religion does more harm in the world than good. In my opinion, YES, DOES MORE HARM is a sign of rationality.If you do too, then the rational nations are: Belgium, Germany, Spain, Australia, India, Sweden, Great Britain, France, Canada, Hungary, Argentina, Poland, Italy, Serbia, Mexico, and Turkey. All of these 15 nations who scored higher than the U.S. But congratulations to the 44% of Americans who answered correctly.

Related Posts:

Critical Thinking

Posts showing good critical thinking

Surveys, references

Andersen, K. 2017. Fantasyland. How America Went Haywire. A 500-Year History. Random House.

AP / GFK. December 8-12, 2011. Poll in 2011. Associated Press. 1,000 interviews. Error: +/- 4%

Baylor. 2017. American values, mental health, and using technology in the age of trump. Baylor religion survey.

Chapman. October 11, 2016. What aren’t they telling us? Chapman University Survey of American Fears.

Gallup. 2005. Paranormal beliefs come (Super)naturally to some.

Gallup. 2005. Three in Four Americans believe in Paranormal.

Gallup. 2016. Most Americans still believe in God.

Harris Poll. 2009. What People Do and do not believe in.

Harris Poll. 2013. What do Americans Believe?

IPSOS. July 2017. Ipsos global poll: Two in three Australians think religion does more harm than good in the world.

Johnson, D. 2016. The Making of Donald Trump. Penguin.

National Science Foundation. 2015. Belief in the Paranormal or pseudoscience. Science and technology: public attitudes and public understand.

Politico. August 3, 2017. How the CIA Came to Doubt the Official Story of JFK’s Murder Newly released documents from long-secret Kennedy assassination files raise startling questions about what top agency officials knew and when they knew it.

Reardon 2016. Reardon, S. October 18, 2016. The scientists who support Donald Trump. Nature.

Uscinski, J.E., et al. 2014. American Conspiracy Theories. Oxford University Press.

Paranormal and supernatural beliefs.
Multiple numbers reflect results from several surveys:

Angels: 77%, 72%, 72% 88% of Christians, 95% of evangelical Christians
Astrology: 25%, 26%, 29%
Channeling: 9%
Civil war wasn’t about slavery but states’ rights: 48%
Climate Change not due to man-made activities: 40%
Clairvoyance: 26%
Communication with the dead is possible: 21%
Creationism: 36%
Devil: 61%, 60%, 58%
ESP: 41%
Ghosts: 34%, 42%, 42%
Haunted Houses: 37%
Heaven: 71%, 75%
Hell: 64%, 61%
Jesus born of a virgin: 73%, 61%, 57%
Jesus is God or son of God: 73%, 68%
Jesus’s resurrection: 70%, 65%
Life after death: 71%, 64%
Miracles: 76%, 72%
Reincarnation: 21%, 20%, 24%
Sun revolves around the Earth: 25%
Telepathy: 31%
UFOs: 34%, 32%, 36%, extraterrestrial beings have visited 24%
Vaccines cause autism: 56%
Witches: 21%, 23%, 26%

Believing that the Civil War was about states rights is not a belief in the supernatural.

Here's a way for you to test it. Do this......try to form a State Militia that isn't the National Guard (you know, the way the Constitution guarantees you the right to do in Article I, Section 8, and Article II, section 2 ?) and see if states rights have changed much since 1789.

The idea that states had rights the federal government could not take away was a very widely held belief before the Civil War....and afterward all the important ones went away. Now all "rights" are handed down from the top, and they appear to me be far from inalienable. This outcome of the Civil War affects citizens of all ethnicities, btw.

So how anyone can say that the Civil War was NOT about states rights is beyond my reckoning, and I claim to be FAIRLY rational, most of the time. To those who say the war was about slavery, let me remind you that slavery WAS a states right issue. It isn't an either/or proposition at all, it's just reframed that way to make Southerners out to be more racist than they are (which is racist enough without it.) That's what bothers me.

This whole argument about "what the Civil War was fought over" is mostly antics with semantics. The history is what it is. If you want to know, then educate yourself. The statement above, often repeated these days, is like a Trump Tweet. If enough people repeat it, then a lot of people believe it, and then the real history is no longer important. Especially since nobody knows much about anything now that happened before 1999 anyway.

Several other things on this list don't pass my sniff test either.

Witches?  In the '90's somebody did a survey that showed the Wiccan group was the fastest growing religion in America.

Clairvoyance?  Ever hear of Edgar Cayce? How much documentation do you need? They recorded 15,000 cases.

Telepathy? The anecdotal evidence is overwhelmingly in support of it. We just don't understand how it works.

Vaccines cause autism? People believe that because one very unscrupulous doctor built a bogus case for that, and it went viral. Ignorance and misinformation, not irrationality per se.

Sun revolves around the earth? Problem is people don't know the meaning of the word "revolve".

Communication with the dead? I'm a skeptic. but people who take Ibogaine frequently say they've communicated with the dead. I think whatever is left of us after we stop breathing doesn't much care about getting back to the living just to shoot the breeze. Whether there is life after death is the world's biggest unanswered question.

Astrology? I'm a skeptic there too, but there's enough there to make me scratch my head. Like most esoteric knowledge, just because we fail to grasp it, that doesn't make keeping an open mind a bad idea. Radio would be considered a form of magic if you went back in time 200 years.

There are more things in heaven and earth, Horatio, Than are dreamt of in your philosophy.

                                                           ---- a really old saying, from way before 1999

Economics / Re: How Blockchain Will Rule Your World
« on: October 16, 2018, 11:33:33 AM »
The stablecoin Tether, as I said, is a proxy for the USD. It's the second most traded crypto, because its a way to get on the sidelines, like going to cash in a market crash. The problem with Tether is that they have not been transparent in showing that they have the dollar cash on hand to back up the crypto they're selling. And now there are several new coins that also track the dollar that are much more open and seemingly above board.

As far as I can tell, this is very much like the precious metals ETF's, anyway.  As in no guarantees of being made whole if the instrument crashes.

Something very like a bank run has been happening on Tether, and on the trading platforms, they've been charging a high premium to trade it. No problem for someone going to cash, from say bitcoin. They can give Tether a pass and buy Paxos or TrueUSD or any one of several other similar competitors, which are doing fine.

But....(there's always a but) the exchanges themselves, used to trading this stuff a lot, are holding their own bankroll in Tether, to a large degree, and have huge exposure if the coin fails, which it might. I've been reading about this for a couple of days, and it seems to be a real danger for the whole crypto market, like when Mt. Gox got hacked.

Tether Peg Cracks (As Goldman Coin Starts Trading)

Tue, 10/16/2018 - 09:50

Tether Peg Cracks
The cryptocurrency market rallied on Monday after a crack in the tether stablecoin led to a surge in the price of Bitcoin. A fall of 3% in tether saw Bitcoin rallying from $6,300 to blow through previous resistance at $7,250 before settling lower on the day.

The move led to gains across the entire spectrum of digital currencies with only tether showing a loss amongst the top twenty coins. The sell-off in the USDT peg is the latest twist after a bout of rumours regarding the Bitfinex exchange and problems surrounding tether wire transfers.

Tether (USDT) is a token that its creators claim is backed 1:1 by U.S. Dollars, yet this has been questioned by traders in the past.

Despite spending the early years of crypto trading as the dominant stablecoin tether is now seeing some significant competition appearing on the horizon to take the throne. Binance have recently announced their backing for the $32 million Terra project, whilst the U.S. tech giant IBM have also backed a stablecoin project which will run on the Stellar network. The Gemini project, which was founded by the Winklevoss twins has also joined the recent stablecoin party with the arrival of the Gemini Dollar (GUSD).

Enter Circle
The real competition for tether may be seen with the arrival of Circle and its USDCoin (USDC), which started trading only a few weeks ago, which the company’s CEO stated was, “basically a dollar that operates on the blockchain.” The goal is to allow a stable bridge between buying and selling cryptocurrencies from standard bank accounts. The key difference with Circle’s offering is that the customers are required to hold $1 for every USD coin in order to provide price stability.

Why is Circle a company to watch? The company was seeded by investment banking titan Goldman Sachs. Never one to miss a bull market or dodge a bear market, Goldman joined a group of illustrious investors, including Accel, Baidu and the Chinese bank CICC in a $250 million financing round. Circle has made aggressive moves in the past months to acquire the Poloniex exchange, quickly adding new coins and alongside the USDC project the company has been putting the finishing touches on some retail products.

Not content with its plans to dominate the crypto space, representatives of Circle also found time to attend a cryptocurrency roundtable hosted by Congressman Warren Davidson at the end of September as lawmakers seek to get control over the nascent financial revolution. Is it possible that Goldman Sachs sees imminent crypto regulation and a flood of retail and institutional money appearing in the space? And is it a coincidence that the tether peg is starting to crack only weeks after the arrival of Circle’s own USD stablecoin?

Show us your dollars
Coincidence or not, tether is now backed into a corner and may be forced to show their hand on the claims that they hold enough assets to back the $2.25 billion market cap that sees the coin hold seventh spot in the cryptocurrency list. A refusal to do so may see an exodus to new stablecoins and a potential rout in the stablecoin. Tether have since released a statement to reassure investors that the dollar reserve, “…remains in surplus of the 1:1 backing of USDT and has more than the necessary currency on deposit to redeem all existing tethers.”

I don’t think they know how this game works!

Economics / Re: How Blockchain Will Rule Your World
« on: October 16, 2018, 10:31:03 AM »
Bitcoin mining uses approximately the same amount of power as all the bank ATM's in the world put together.

Jun 18, 2018, 09:44am

No, Bitcoin Won't Use Up All The World's Energy

 Intelligent Investing
Clem Chambers Contributor

One of the first thoughts anyone looking at bitcoin will have is the amount of energy used by miners to maintain the blockchain. Apparently, some people think that bitcoin and blockchain will boil the seas dry with its energy consumption.

Bitcoiners would say this is FUD--the modern equivalent of BS or just straight lies and is often used as an out of hand rebuttal of argument. FUD stands for fear, uncertainty and doubt and used to be an old strategy in marketing to confuse your competitors and keep them from buying your product in a corporate environment generally ruled by a culture of CYA (cover your rear) and fear.

Bitcoin using too much energy is thus pure FUD as it originates in the sectors that will lose more or be disrupted most by the blockchain, the latest being the Bank for International Settlements (BIS), a core piece of the global banking infrastructure.

Let’s have a quick look at banking’s footprint. According to the world bank there are 12.5 bank branches per hundred thousand people in the world. That doesn’t include their massive energy-munching head offices and titanic server farms, the scale of which I’m sure would embarrass even the mightiest bitcoin miner.

The world population is 7.6 billion so there are, at least, according to the World Bank (and they should know), just shy of 1 million bank branches. The have 3 million ATMs, roughly the same number of machines as there are ASICs mining bitcoin. As such, bitcoin uses the same amount of energy as the banking sectors ATMs, leaving that business to boil the oceans with 1 million branches and the resource drain of 60 million people and their associated overheads. (Yes, a bank like HSBC does employ 228,000 and have 3,900 offices.)

There will, of course, be changes to blockchain technology to scale it and make it more energy efficient, but energy consumption is only an issue to those that haven’t looked into it.

Bitcoin and other cryptocurrencies also potentially replace gold as an international asset of last resort and it is said the energy expended raping the earth for the precious gold monetary relic is five times that expended on bitcoin. Even if it was a 1:1, the replacement of gold by bitcoin would surely be an environmental good.

Then you just have to multiply out the ponderous, soul destroying processes that require never-ending paper chases to see that crypto would be a giant boon to the environment as the leviathans of energy-gobbling bureaucracy fall to the greater efficiency of crypto.

I don’t mean to go all Marxist on my gentle reader but in the end it all comes back to energy efficiency because everything backs out to energy costs in the end. If crypto and blockchain is not more energy efficient it simply won’t be economically feasible to use it because banks and their offices, ATMs and tens of millions of workers will simply cost less than the blockchain alternative.

Can you see that happening? No, nor can anyone.

There is, however, a pinch point. This pinch point is energy. There simply is not enough of it being laid down for the future, and I mean electricity.

Is it really smart to hold every photo I ever took in the cloud? Is it really a good idea for Google, Microsoft and Amazon to be hoovering everything I say and do into massive server clouds powered by hydro power? Does anyone complain about this boiling the seas?

Well consider this. Google grosses $110 billion in sales, it makes $12 billion, it has 12,000 billion yearly searches, call it 1c a search. (That in its own right is rather fascinating.) When energy makes up a huge amount of that cost, its 8% margins start to look mighty slim and the sudden bans on crypto advertising amongst the likes of Facebook, Twitter and Google start to seem more than coincidental as the crypto miners start to gravitate to the cheap energy that keeps these companies in the business of data hoarding.

Yet this is only the tip of the iceberg of energy shortage just over the brow. If the dream of electric cars and trucks is to be realized and Europe is actually stating it wants petrol and diesel gone by 2030, the world needs 50% more power stations.

It is worth stating again. If the U.S. and Europe are going to dump the internal combustion engine it will need 50% more electricity infrastructure and will have to install it in 20 years.

They’d better get cracking and we’d better get buying those stocks.

Meanwhile, expect lots of FUD around anything that draws electricity and threatens to drive electricity prices high. It is coming and lots of the darlings of silicon who claim environmental credibility while sucking power out of the system with a mighty force will feel the pinch as their energy hungry ways catch up with them.

Bitcoin mining, data mining, it’s all the same.

Economics / Re: How Blockchain Will Rule Your World
« on: October 16, 2018, 10:22:08 AM »
Proof-of-work protocol (bitcoin, crypto 1.0) is rapidly being replaced right now with proof-of-stake. Ethereum is switching, and EOS and some others went straight there. There are a number of other possible blockchain validation protocols. Above my pay grade. I'd be interested to know where this is all headed. Non-mineable cryptos are one alternative, and that seems to be the sort of thing that proprietary systems (like Ripple/XRM) use to solve some of the thorny issues. But that doesn't support the idea of a completely decentralized web, which is where blockchain appears to be taking us, if the energy problems are in fact subject to a solution. I don't know.

A (Short) Guide to Blockchain Consensus Protocols

Amy Castor
 Mar 4, 2017 at 11:50 UTC  |  Updated  May 17, 2017 at 17:11 UTC

We hear plenty of talk of how public blockchains are going to change the world, but to function on a global scale, a shared public ledger needs a functional, efficient and secure consensus algorithm.

A consensus algorithm, like bitcoin's proof of work (the one we hear about most often), does two things: it ensures that the next block in a blockchain is the one and only version of the truth, and it keeps powerful adversaries from derailing the system and successfully forking the chain.

In proof of work, miners compete to add the next block (a set of transactions) in the chain by racing to solve a extremely difficult cryptographic puzzle. The first to solve the puzzle, wins the lottery. As a reward for his or her efforts, the miner receives 12.5 newly minted bitcoins – and a small transaction fee.

Yet, although a masterpiece in its own right, bitcoin's proof of work isn't quite perfect.

Common criticisms include that it requires enormous amounts of computational energy, that it does not scale well (transaction confirmation takes about 10-60 minutes) and that the majority of mining is centralized in areas of the world where electricity is cheap.

Bitcoin creator Satoshi Nakamoto woke us up to the potential of the blockchain, but that doesn't mean we can't keep searching for faster, less centralized and more energy-efficient consensus algorithms to carry us into the future.

While not a comprehensive list, the following are a few of the alternative approaches being kicked around out there.

Proof of stake

The most common alternative to proof of work is proof of stake.

In this type of consensus algorithm, instead of investing in expensive computer equipment in a race to mine blocks, a 'validator' invests in the coins of the system.

Note the term validator. That's because no coin creation (mining) exists in proof of stake. Instead, all the coins exist from day one, and validators (also called stakeholders, because they hold a stake in the system) are paid strictly in transaction fees.

In proof of stake, your chance of being picked to create the next block depends on the fraction of coins in the system you own (or set aside for staking). A validator with 300 coins will be three times as likely to be chosen as someone with 100 coins.

Once a validator creates a block, that block still needs to be committed to the blockchain. Different proof-of-stake systems vary in how they handle this. In Tendermint, for example, every node in the system has to sign off on a block until a majority vote is reached, while in other systems, a random group of signers is chosen.

Now, we run into a problem. What is to discourage a validator from creating two blocks and claiming two sets of transaction fees? And what is to discourage a signer from signing both of those blocks? This has been called the 'nothing-at-stake' problem. A participant with nothing to lose has no reason not to behave badly.

In the burgeoning field of 'crypto-economics', blockchain engineers are exploring ways to tackle this and other problems. One answer is to require a validator to lock their currency in a type of virtual vault.

If the validator tries to double sign or fork the system, those coins are slashed.

Peercoin was the first coin to implement proof of stake, followed by blackcoin and NXT. Ethereum currently relies on proof of work, but is planning a move to proof of stake in early 2018.

Proof of activity
To avoid hyperinflation (what happens when too much of a currency floods the system) bitcoin will only ever produce 21m bitcoins. That means, at some point, the bitcoin block reward subsidy will end and bitcoin miners will only receive transaction fees.

Some have speculated this might cause security issues resulting from a 'tragedy of the commons', where people act in self-interest and spoil the system. So, proof of activity was created as an alternative incentive structure for bitcoin. Proof of activity is a hybrid approach that combines both proof of work and proof of stake.

In proof of activity, mining kicks off in a traditional proof-of-work fashion, with miners racing to solve a cryptographic puzzle. Depending on the implementation, blocks mined do not contain any transactions (they are more like templates), so the winning block will only contain a header and the miner's reward address.

At this point, the system switches to proof of stake. Based on information in the header, a random group of validators is chosen to sign the new block. The more coins in the system a validator owns, the more likely he or she is to be chosen. The template becomes a full-fledged block as soon as all of the validators sign it.

If some of the selected validators are not available to complete the block, then the next winning block is selected, a new group of validators is chosen, and so on, until a block receives the correct amount of signatures. Fees are split between the miner and the validators who signed off on the block.

Criticisms of proof of activity are the same as for both proof of work (too much energy is required to mine blocks) and proof of stake (there is nothing to deter a validator from double signing).

Decred is the only coin right now using a variation of proof of activity.

Proof of burn

With proof of burn, instead of pouring money into expensive computer equipment, you 'burn' coins by sending them to an address where they are irretrievable. By committing your coins to never-never land, you earn a lifetime privilege to mine on the system based on a random selection process.

Depending on how proof of burn is implemented, miners may burn the native currency or the currency of an alternative chain, like bitcoin. The more coins you burn, the better chance you have of being selected to mine the next block.

Over time, your stake in the system decays, so eventually you will want to burn more coins to increase your odds of being selected in the lottery. (This mimics bitcoin's mining process, where you have to continually invest in more modern computing equipment to maintain hashing power.)

While proof of burn is an interesting alternative to proof of work, the protocol still wastes resources needlessly. Another criticism is that mining power simply goes to those who are willing to burn more money.

The only coin that uses proof of burn is slimcoin, a cryptocurrency based on peercoin. It uses a combination of proof of work, proof of stake and proof of burn, but is only semi-active at this time.

Proof of capacity

As we've seen, most of these alternative protocols employ some type of pay-to-play scheme. Proof of capacity is no different, but here you 'pay' with hard drive space. The more hard drive space you have, the better your chance of mining the next block and earning the block reward.

Prior to mining in a proof-of-capacity system, the algorithm generates large data sets known as 'plots', which you store on your hard drive. The more plots you have, the better your chance of finding the next block in the chain.

By investing in terabytes of hard drive space, you buy yourself a better chance to create duplicate blocks and fork the system. But with proof of capacity, we still have the problem of nothing at stake to deter bad actors.

Variations of proof of capacity include proof of storage and proof of space. Burstcoin is the only cryptocurrency to use a form of proof of capacity.

Proof of elapsed time

Chipmaker Intel has come up with its own alternative consensus protocol called proof of elapsed time. This system works similarly to proof of work, but consumes far less electricity.

Further, instead of having participants solve a cryptographic puzzle, the algorithm uses a trusted execution environment (TEE) – such as SGX – to ensure blocks get produced in a random lottery fashion, but without the required work.

Intel's approach is based on a guaranteed wait time provided through the TEE. According to Intel, the poof-of-elapsed-time algorithm scales to thousands of nodes and will run efficiently on any Intel processor that supports SGX.

The one problem with this protocol is it requires you to put your trust in Intel – and isn't putting trust in third parties what we were trying to get away from with public blockchains?

Marathon Man Newz / Re: Charles Hugh Smith On Who Is Middle Class
« on: October 16, 2018, 09:21:56 AM »
Mill Creek (my creek) is a tributary to the nearby Lampasas River. It is flooding.

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Screen Shot 2018 10 16 at 11 19 37 AM

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