JanisL

A lot of people don't know just how corrupt the IOC is, I suspect if this was common knowledge there would be a hugely increased number of people calling for boycotts of the Olympics.

Open market operations of various central banks certainly impacts equity prices of publicly traded stocks. In some cases the holdings are enormous: https://asia.nikkei.com/Business/Markets/BOJ-tops-pension-wh...

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In a heavily inflationary environment this practice could turn out to be entirely maladaptive. What percentage of inflation year on year will you change your mind at? Do you even have a line?

Just be very careful with this stuff and make sure to talk to a psychiatrist that knows what they are doing. I've seen a few people get prescribed benzodiazepines for anxiety related issues from general practitioners who didn't know what they were doing and the results were vastly worse than if nothing had been done. A tolerance can very quickly be built in which this class of drugs become vastly less effective and the withdrawals in particular were especially brutal. A public case of this was seen recently with Jordan Peterson lately and it shows just how serious this matter is (see https://www.youtube.com/watch?v=3ktjZhih3LQ for an example of how serious the health consequences are).

Whatever you do just make sure you are informed, psychoactive drugs are a serious matter.

The monetary system in many places was already mostly private, most money is created by commercial banks and we have institutions like central banks with private ownership in many countries.

I think a lot of skilled software developers might be unaware of just how bad the practices can be in non-software companies regarding software development.

A few years back I remember a big corp explicitly telling me that a project for an Excel based integration between some systems would have easily got buyin and budget. Despite it being in a broader sense a crappy tool for the job due to everyone having excel installed and almost nobody being able to get approval in a reasonable amount of time for anything else to get installed it did appear to be the easiest option in the circumstances. Before this I think I was one of those people who just ruled out using Excel for integrations because I just couldn't see how it could possibly be the best option in any circumstances.

It's a bit like getting struck by lightning, you deal with this when it happens if it happens. This is sufficiently unlikely for most people that it's not worth being too concerned about it when other exceedingly more dangerous and pressing matters could be dealt with using that same energy.

How do you account for differences in the purchasing power of those dollars you are making the measurement in?

An example of why this is relevant: https://www.investing.com/indices/zimbabwe-industrial

There's definitely some very big problems with people demanding fixed interest returns when demographics aren't good: https://realinvestmentadvice.com/the-unavoidable-pension-cri...

I think there's a massive difference between the government owning things and the central bank owning things for the reasons you mention about accountability.

Bitcoin had design goals in mind to avoid certain downsides of centralized currencies. The cryptocurrency space however lives inside the broader economy and questions about what money is and the regulations around it don't go away just because a specific cryptocurrency thought about some of these aspects in it's design. Even if bitcoin were to solve everyone's problems as some maximalists would claim how do we even implement this? Considering much of the world doesn't have holdings in bitcoin what are we to do? Similarly what do we do about people who don't have the infrastructure to run full nodes? What about dealing with interference with using the cryptocurrency imposed by external actors?

There's good reasons why people discuss these ideas, bitcoin, much like anything else is just part of the direction things can go in and it doesn't exist in isolation from the rest of the world.

I'm trying to encourage a discussion about what money itself should be. I think without this discussion it will be very hard to make effective regulations around money and the implications this has on the operations of the banking system. Once people are more informed about these topics better regulation will be possible. Frankly I don't see people talk about the fundamentals of money much, the current monetary system is convenient enough for most people such that they don't have to think about the details of how it works in their day to day lives.

It would seem that the temptation to set the price of everything is increased when there are impediments to setting the interest rate (since this removes an important monetary policy lever). I think this has been seen lately as the zero-lower-bound on nominal interest rates has started to come into play in many places.

I'm not sure why you'd take from this that I'm ignoring the role of regulation when I'm commenting on a situation whereby the regulatory framework of central banks allows them to take actions that damage the signaling power of pricing. I most definitely think that banks and central banks must be carefully regulated because they have the special privilege of creating money and with this comes a lot of responsibility.

The other part though is that if money is corrupted it impacts the process of regulation itself. For example creating good regulation to tax companies is made far more difficult when there's fundamental differences between the nature of the money that those companies themselves have access to. I'm sure it would be possible with a large amount of effort to have regulations with non-fungible money but there's challenges there that would be substantially difficult to address and the complexity of that regulation would come with it's own non-zero costs to society.

I strongly believe that money itself has been corrupted lately, this then causes all number of bad flow on effects to happen. A massive shift happened when central banks started getting involved in direct purchases of various asset types and we started to see a major distortion happen in monetary policy that which has distorted the functioning of money itself. For example who would care if their business is completely unprofitable if it could get access to freshly printed money every quarter to prop it up. What then happens to all the other businesses who don't get access to that freshly created money? When we have situations like the BoJ owning more than 60% of the Nikkei 225 we really ought to be asking some serious questions about if we really have free markets? We also should be asking some questions about the properties we desire in money itself. If a central monetary agency can go about unconventional monetary policy such as purchasing equities we can quickly have a situation whereby an unelected group of bureaucrats can damages the ability of money to be used as a means to convey information. Further there's questions about picking winners and losers that comes up there too. As a whole I think people need to ask what money is again and have some serious conversations about what money and the monetary system should be. It seems that these difficult questions really fell out of favor a while ago and as a result things have been drifting in a direction that many people aren't comfortable with.

If we don't ask these questions then technological approaches to money, like various cryptocurrencies and other financial technologies are unlikely to actually cause long lasting improvements. We have some serious monetary policy problems in the world right now and while some tech could help (in some cases) these aren't primarily technological problems.

Bitcoin is a lot less liquid than many people think, a lot of wash trading has occurred recently that has obscured this.

I think the stimulus feedback loop you mention is exactly the situation that could provoke strong inflation. Were the markets free of this intervention/interference I'd be strongly in the deflationary camp because fundamentals worldwide are not good at all. But that's the bothersome thing, since the repo crisis of 2019 I've not been bullish on fundamentals but yet asset prices just keep inflating regardless. The pullback in 2020 being the shortest bear market I've ever seen followed by all time highs is what changed my mind on the potential of inflation, before that point I just didn't see it as possible at all given the weak global fundamentals. But yet there we say a situation where fundamentals were terrible but the market rebounded so fast. The upside-down stimulus driven market where bad news implies more stimulus implies higher asset prices could turn what would traditionally have been a strongly a deflationary situation into one where inflation occurs via rampant monetization and fiscal/monetary interventions. The question I keep asking is if the interventions can outpace the deflationary fundamentals? The introduction of Central Bank Digital Currencies would be a major change if for no other reason than they allow more monetary interventions to be done faster and more directly than before.

I have to say I thought the most ridiculous name I'd see in this space was coins named after people's dogs. This not-even-a-name might be even more ridiculous. It reminds me of those spam emails where they the writing forms an effective filter on the people who reply, the idea being that they are so ludicrous that only a sucker would reply (hence saving the time of the scammers on interacting with people who reply but won't fall for the scam). I have to say I'm super sick of all the bullshit happening in the crypto space at the moment because I think it really tarnishes the reputation of everything in the space including some decentralized apps and decentralized finance stuff that could actually be a massive net positive to everyone.

It honestly reminds me of the incident from a few years back where people were climbing the walls of buildings to help people inside cheat: https://www.cbsnews.com/news/indian-parents-scale-school-wal... and https://news.yahoo.com/india-police-arrest-1-000-over-fresh-...

At this point inflation (if it happens) will most likely be a policy driven affair since growth doesn't seem to be the main driver for monetary expansion at this moment in time. I think there's reasons this could happen with debt to GDP at such historical high levels the only way out of this is to inflate the debt away or to have debt defaults.

I think reducing the harms that are done by trolls and various other bad actors on the internet is an important question for this era. But this might not be the main motivation behind these new proposals. One of the most concerning parts of this is that the rules around what trolling is and who gets to determine who is a troll have not been a prominent part of the discussion. There's important recent political context here that international readers may be missing, the current federal government campaigned at the last election with a promise to introduce a independent federal anti-corruption commission but in recent times has completely backflipped on this (https://www.smh.com.au/politics/federal/morrison-must-honour...). Australia's mass media ownership is remarkably centralized with Murdoch owning an extremely high percentage of the print media in the country (https://www.abc.net.au/news/2021-04-14/fact-file-rupert-murd...). This has led to a number of high profile people including two former prime ministers from both side of the political divide to speak out and say there's a major problem (https://www.theguardian.com/australia-news/2021/apr/21/forme...). This is also why we had that legislation that aimed to force social media to pay the print media for links, there's very clear evidence that the Murdoch media machine has very deep influence with the current system of Australian politics. This is relevant because for many years this same media organization was being exceedingly supportive of the Berejiklian government in NSW and was actively avoiding reporting on their corruption and generally reported in a persistent positively biased way on certain people in that government (and important to note that this positive reporting was done on people who's conduct wasn't ethical). As a result a lot of local populace just simply didn't know how bad things were, discussions on other non-Murdoch media and social media was the way in which many people became aware of just how bad the corruption really was in NSW. I mean sure you didn't have to dig that hard, or maybe even at all, because the deputy premier liked to boast about how he engaged in pork barrelling and other such conduct (for foreign readers, this is not satire or an exaggeration, he literally used to openly claim this as a badge of honor: https://happymag.tv/barilaro-blue-mountains-bushfire-relief-...). But the corruption was by Australian standard bad: https://jacobinmag.com/2021/10/australia-nsw-premier-berejik..., had it been other politicians involved it would have been in the newspapers frequently. Once news of this finally got out this eventually led to the leaders of the NSW State government being ousted. The persistent corruption and unethical behavior of a small group was brought into the open by an investigation of the NSW anti-corruption commission and the news was impossible to ignore at this point. This episode also involved the arrest without a warrant (with proper process not being followed, the questioning of the attorney general about this is entirely worth watching: https://www.youtube.com/watch?v=lcKBDveFXCU) of a journalist who was investigating this corruption. There was also a defamation case brought up by the deputy premier against a Youtuber who was documenting the corruption of the deputy premier. After the scandal was well and truly out in the open the deputy premier resigned and settled the defamation case as a defense based on truth of claims looked fairly certain to prevail and the political backing he once had was gone (https://www.abc.net.au/news/2021-11-05/john-barilaro-settles...). Since this episode of NSW politics has unfolded the pushes to have a federal independent corruption commission have once again been prevented from moving forward. The main thing that concerns many people is that these defamation laws might in practice be used only to silence people talking about corruption and other political opponents much like what was seen very recently in 2021 in NSW. It is entirely possible that the stated aim of reducing harm to people in the community won't actually be a priority here at all. Hopefully an informed discussion can be had here and good laws can be created, there's most certainly issues with trolls and various bad faith actors online so hopefully good policy can be made in this space.

I think reducing the harms that are done by trolls and various other bad actors on the internet is an important question for this era. But this might not be the main motivation behind these new proposals. One of the most concerning parts of this is that the rules around what trolling is and who gets to determine who is a troll have not been a prominent part of the discussion. There's important recent political context here that international readers may be missing, the current federal government campaigned at the last election with a promise to introduce a independent federal anti-corruption commission but in recent times has completely backflipped on this (https://www.smh.com.au/politics/federal/morrison-must-honour...). Australia's mass media ownership is remarkably centralized with Murdoch owning an extremely high percentage of the print media in the country (https://www.abc.net.au/news/2021-04-14/fact-file-rupert-murd...). This has led to a number of high profile people including two former prime ministers from both side of the political divide to speak out and say there's a major problem (https://www.theguardian.com/australia-news/2021/apr/21/forme...). This is also why we had that legislation that aimed to force social media to pay the print media for links, there's very clear evidence that the Murdoch media machine has very deep influence with the current system of Australian politics. This is relevant because for many years this same media organization was being exceedingly supportive of the Berijiklian government in NSW and was actively avoiding reporting on their corruption and generally reported in a persistent positively biased way on certain people in that government (and important to note that this positive reporting was done on people who's conduct wasn't ethical). As a result a lot of local populace just simply didn't know how bad things were, discussions on other non-Murdoch media and social media was the way in which many people became aware of just how bad the corruption really was in NSW. I mean sure you didn't have to dig that hard, or maybe even at all, because the deputy premier liked to boast about how he engaged in pork barrelling and other such conduct (for foreign readers, this is not satire or an exaggeration, he literally used to openly claim this as a badge of honor: https://happymag.tv/barilaro-blue-mountains-bushfire-relief-...). But the corruption was by Australian standard bad: https://jacobinmag.com/2021/10/australia-nsw-premier-berejik..., had it been other politicians involved it would have been in the newspapers frequently. Once news of this finally got out this eventually led to the leaders of the NSW State government being ousted. The persistent corruption and unethical behavior of a small group was brought into the open by an investigation of the NSW anti-corruption commission and the news was impossible to ignore at this point. This episode also involved the arrest without a warrant (with proper process not being followed) of a journalist who was investigating this corruption. There was also a defamation case brought up by the deputy premier against a Youtuber who was documenting the corruption of the deputy premier. After the scandal was well and truly out in the open the deputy premier resigned and settled the defamation case as a defense based on truth of claims looked fairly certain to prevail and the political backing he once had was gone (https://www.abc.net.au/news/2021-11-05/john-barilaro-settles...). Since this episode of NSW politics has unfolded the pushes to have a federal independent corruption commission have once again been prevented from moving forward. The main thing that concerns many people is that these defamation laws might in practice be used only to silence people talking about corruption and other political opponents much like what was seen very recently in 2021 in NSW. It is entirely possible that the stated aim of reducing harm to people in the community won't actually be a priority here at all. Hopefully an informed discussion can be had here and good laws can be created, there's most certainly issues with trolls and various bad faith actors online so hopefully good policy can be made in this space.

Tether is an enormous fraud and the financial reporting of the reserves has just never been up to generally accepted standards.

The thing with crypto is that much like some of these other commodity markets there's less real trading volume than many people think (there's been a lot of wash trading going on: https://cryptobriefing.com/binance-wash-trading-icebergs-tip...). Where crypto is very different from the futures markets is that you can just buy the stuff directly because the costs of holding it are much lower. Say I want to invest in oil, it's a massive pain in the ass to build warehousing to start taking delivery, whereas something like crypto is much easier for a company or individual to hold. From this point of view there's very real non-regulatory reasons why trading futures for oil makes sense whereas this is not so for cryptocurrencies.

I'm aware that capital requirements have mostly taken over from reserve requirements over time (in such a way that the banking system is even less sound than the average person assumes), but the point I was making is that in all these these systems there will be liquidity issues if all the depositors were to try to withdraw their money to spend it on something at the same time.

In the modern world we primarily have banking systems that are based on fractional reserve banking and currencies without any explicit backing. This means that from a forex point of view the currencies are only worth as much as there is confidence in them. (National currencies often derive power in a practical sense due to taxes having to be paid in those currencies even without any explicit backing of the currencies value). Because of these dynamics if everyone were to try to withdraw their money from the bank at the same time there would be a major problem because the banks don't have the money to cover it. An event that makes people in a country all want to withdraw their money will cause a crisis just about everywhere at the moment. Sure you'll get people from the central bank saying they can create enough money to pay everyone out, which they can pretty easily do due to the fact that most money now is just entries in a database. But the problem in all modern banking crisis situations isn't so much the act of giving people money its what you can buy with that money. (A caveat, when things get really bad like they did in Venezuela the currency degraded so much that the government had problems paying for the printing and transport of new banknotes with even more zeros, but that's a rather exceptional case that occurred very late in a crisis, again the money was buying less)

Banking crisis conditions can come about for a variety of different reasons but they all involve some lack of confidence in the ability to be able to exchange money for goods at a later point in time. This can come about because people aren't able to access their money in the banks (Eg Cyprus crisis) or because the value of the money is rapidly deteriorating (Eg Yugoslavian Hyperinflation) or because there's some event that devalues the currency. This is by no means an exhaustive list, but it shows that different things in different places can cause crisis situations to emerge. There's some interesting work that was done by the Bank of International Settlements about the early warning indicators for systemic banking crises. Seeing what was happening in Turkey inspired me to write about bank bail ins. Along with bail outs this is something that you'll likely see in banking crises. More detail about the early warning indicators and bail in mechanisms here: https://www.lesinskis.com/bank-bail-ins.html

I also talk about this in the article but I don't think it's easy to neatly determine where currency crisis situations "start". There's at least 14 countries in the world that are in what could be the early stages of a banking and currency crisis but it's likely that people will only say they are in a crisis at a much later stage where the problems are so big they are impossible to ignore. Other places like Canada get ignored routinely but the situation there could rather easily turn into a major crisis unless something changes there.

Its not a real black swan because it's so painfully obvious to anyone who's looked at it in depth but the demise of Tether will have an enormous impact on BTC.

Basically the COMEX changed the rules explicitly to disadvantage the Hunt Brothers. The changes made to margin requirements is what made the difference here. I don't think anyone could claim that the silver market is an entirely free market, I remember last year a press release where the COMEX said they weren't sure how much they actually had in their vaults in eligible and registered, with a plus/minus 50% figure being given on their estimates. I can't think of any other major market where someone would come out and say they didn't know how much inventory they had and that their best estimate could be 50% off. And the participants in the silver market are still rather ridiculous to this day: https://www.reuters.com/business/finance/jpmorgan-pay-60-mln...

I think a lot of people in the comments are focused on the various sales aspects of why black Friday prices move the way they do however I think this year is an example of high inflation being more of a factor than anything else. I'd think this is an indicator that it is probably a good time to buy some inflation hedges instead of discretionary consumer goods.

I worked at an electronics place a while back and I remember there were issues in an old chip in some older products. Not talking anything major here but a few known bugs that could have been fixed. But usually nobody had the time allowed to go fix up the old firmware on old products because there were always other things to deal with that were deemed to be a higher business priority. Unfortunately there's often more money to be made by the manufacturer by making the costs of these bugs externalities on the entire market than there is to be made by fixing them. Even when vendors have large budgets to work on security work done on end of life products ends up being typically abandoned because there's just more money to be made elsewhere at the moment. Open source chips could help deal with this end of life issue.