The space industry is dominated by private companies, but one of the biggest banks on Wall Street is telling clients to pay attention to coming investment opportunities.
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Category: finance – Page 123
The virtual currency markets have been through booms and busts before — and recovered to boom again. But this bust could have a more lasting impact on the technology’s adoption because of the sheer number of ordinary people who invested in digital tokens over the last year, and who are likely to associate cryptocurrencies with financial ruin for a very long time.
The number of people who bought virtual currencies more than doubled last winter. For people who got in late, the bust has been disastrous.
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“This is the dark side of technological revolutions and that dark side has always been there,” Haldane added. “That hollowing out is going to be potentially on a much greater scale in the future, when we have machines both thinking and doing — replacing both the cognitive and the technical skills of humans.”
Haldane said that the so-called Fourth Industrial Revolution — a digitally-driven paradigm shift similar to previous industrial revolutions in the West — had the potential to displace numerous jobs and leave people “technologically unemployed.”
“Each of those [industrial revolutions] had a wrenching and lengthy impact on the jobs market, on the lives and livelihoods of large swathes of society,” Haldane told the BBC.
The BOE economist cautioned that previous industrial revolutions resulted in “heightened social tensions,” “financial tensions” and “inequality.” The First Industrial Revolution, which took place during the Victorian era, transformed Britain’s economy, leading to the creation of ground-breaking industrial innovations including the steam train and advanced machine tools, all the while resulting in layoffs especially in industries like textiles.
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Doctor? Who?
New York University said Thursday that it will cover tuition for all its medical students regardless of their financial situation, a first among the nation’s major medical schools and an attempt to expand career options for graduates who won’t be saddled with six-figure debt [Editor’s note: the link may be paywalled]. From a report: School officials worry that rising tuition and soaring loan balances are pushing new doctors into high-paying fields and contributing to a shortage of researchers and primary care physicians. Medical schools nationwide have been conducting aggressive fundraising campaigns to compete for top prospects, alleviate the debt burden and give graduates more career choices. NYU raised more than $450 million of the roughly $600 million it estimates it will need to fund the tuition package in perpetuity, including $100 million from Home Depot founder Kenneth Langone and his wife, Elaine. The school will provide full-tuition scholarships for 92 first-year students — another 10 are already covered through M.D./PhD programs — as well as 350 students already partway through the M.D.-only degree program.
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The FBI is warning banks about a fraud scheme called an ATM cash-out, Krebs on Security reports. With this type of heist, attackers typically compromise a bank or payment card processor with malware, disable fraud controls and withdraw large sums of money — sometimes millions of dollars — with cloned bank cards. The FBI reportedly sent an alert to banks last week. “The FBI has obtained unspecified reporting indicating cyber criminals are planning to conduct a global Automated Teller Machine (ATM) cash-out scheme in the coming days, likely associated with an unknown card issuer breach and commonly referred to as an ‘unlimited operation’,” said the notice.
Once hackers gain access to a financial institution’s system, often through phishing, they’ll alter account balances as well as disable maximum ATM withdrawal amounts and transaction limits. That way, they can quickly take out large amounts of cash from ATMs with fraudulent bank cards made from stolen card data and gift cards.
Last month, Krebs on Security reported on two successful applications of this type of scheme. Hackers were able to steal around $2.4 million from The National Bank of Blacksburg through two ATM cash-outs in 2016 and 2017.
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Today, economist and Nobel laureate, Paul Krugman, wrote in the New York Times, that Bitcoin is taking us back 300 years in monetary evolution. As a result, he predicts all sorts of bad things.
A significant basis for Mr. Krugman’s argument is that the US dollar has value because men with guns say it does.
Is Bitcoin erasing 300 years of monetary evolution?
Running with the metaphor that fundamental change to an economic mechanism represents ‘evolution’, I think a more accurate statement is that Bitcoin is not erasing the lessons of history. Rather, it is the current step in the evolution of money. Of course, with living species, evolution is a gradual process based on natural selection and adaptation. With Bitcoin, change is coming up in the rear view mirror at lightning speed.
The Evolution of Money
When a medium of exchange is portable, fungible, divisible, unforgeable and widely accepted, it becomes money. For at least six millennia, barter was gradually replaced by various mediums of exchange.
- Obsidian —» Cowry shells —» Gold —» Promissory notes (backed by a Bank, employer or wealthy industry) —» Fiat (national currency)
But what backs these forms of money? What gives them value?
The first 3 currencies above were accepted as money on 5 continents. They were backed by their scarcity and unique characteristic properties (Aristotle called this intrinsic value). But even gold cannot serve as a widely used currency today. Although it is portable and scarce, it is not easily tested or subdivided in the field; it is risky to transport and difficult to track; and it is not suited to instant electronic settlement. But what about Fiat money. What backs it?
What Backs National Currencies?
Fiat has been backed by various different things throughout history. They are all compromised attempts to establish confidence and trust. They are compromised, because the fall short of one or more facets of trust.
In the list below, monetary backings in Red are what Mr. Krugman calls “men with guns”. That is, he claims that government demands give value to the dollar:
- Value tied to gold —» Promise of redemption —» Legal tender (public must accept it for all debts) —» settlement of taxes —» The “good faith and credit” of workers
Unfortunately, the transition away from a trustworthy basis and the constant temptation of kings, dictators and politicians to print money based on credit (or nothing at all—as in the case of our fractional reserve system), has created a house of cards that few people believe is sustainable.
Bitcoin changes all this.
Finally, a crowd-sourced trust basis was invented (or discovered). It is unhackable, un-inflatable, unforgeable and immutable. Most important, it allows a government to be decoupled from its own monetary policy and supply. This is a remarkably good thing for businesses, consumers, creditors, trading partners—and especially for governments.
And Bitcoin is backed by something better than guns, gold or promises. It is provably scarce, capped in supply, completely fair, and built on a massive, crowd-sourced network of bookkeepers and auditors. It is the first currency—and quite probably the last—built on genius math and indisputable trust.
Despite the gross misunderstandings and misconceptions of early pundits, it does not interfere with a government’s ability to tax, to spend or to enforce tax collection—and it does not facilitate crime.
Bitcoin is new, but the goal of distributing trust is not as radical as you might think. It addresses a problem that economists and mathematicians have pondered since Aristotle and the ancient Greeks…
Background
Ever since the transition from real gold to government notes, bank notes and bank ledgers—economists have wondered if value can arise from a public trust that is durable, distributed and stateless. Until 2009, the answer seemed to be that this was impossible because of the double-spend problem.
But 9 years ago, something changed; and the change is dramatic. It will take an additional decade for most people to understand and appreciate this change…
In the first paragraph, I cited Mr. Krugman’s statement that the US Dollar has value because of “men with guns” (a reference to the fact that its use is legally compelled for payment of any debt and for government taxes). But this is not what gives it value. The dollar, the Euro, a Picasso painting and a fresh serving of hot french fries all derive their value from supply and demand. Bitcoin is no different. The trick is to generate viral demand and a ubiquitous infrastructure needed to achieve a robust two-sided network.
In the white paper that introduced both blockchain and Bitcoin (the first blockchain application), Satoshi taught us that a widespread and easy to access communications network (the internet and universal access to smartphones) can give rise to value that is based on a different type of trust. Instead of trust in a government, a bank, or testing the chemistry of a precious metal, value can arise from trust in a formula that is ubiquitous, redundant and constantly monitored and vetted.
All of these things have a value based on demand and the available supply. But with Bitcoin, the medium of exchange (and additionally the store and transfer of value), can be achieved by math, distributed trust and a pure, two-sided network.
So, is Bitcoin taking us backward in time, utility, safety and governance? I have never been awarded a Nobel Prize—but it seems pretty clear to me that Bitcoin is taking us forward and not backward.
Philip Raymond co-chairs CRYPSA, hosts the New York Bitcoin Event and is keynote speaker at Cryptocurrency Conferences. He sits on the New Money Systems board of Lifeboat Foundation. Book a presentation or consulting engagement.
The financial costs of flooding in Canada’s maritime region could spike by 300 per cent by the end of the century if steps are not taken to address the impacts of climate change.
A study done by researchers at the University of Waterloo looked at the Halifax, Nova Scotia area, a region hard hit by recent riverine flooding. The team, made up economists, geographers and political scientists, merged data on flood probability, climate change and financial payout information from the insurance/re-insurance market and used the information to develop a forecast.
“Until recently there hasn’t been a lot of work exploring what increased flooding will cost, and who will get stuck with the bill,” says Andrea Minano, coordinator of the Canadian Coastal Resilience Forum (CCRF) and a researcher at Waterloo’s Faculty of Environment. “The increases in flood losses put into question the long term insurability in the Halifax area, and highlight a broader problem facing many other areas in Canada if no actions are taken to mitigate and adapt to climate change.”
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