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Richard Mellor / Bitcoin: Blockchains and the crypto craze
« Last post by Richard Mellor on Today at 06:00:06 AM »
Bitcoin: Blockchains and the crypto craze

by Michael Roberts

The cryptocurrency craze seems to have taken a dive in recent  weeks since the Chinese authorities clamped down on speculation in the  bitcoin market. The history of financial markets is littered with asset  price bubbles, from tulips in the early-1600s to more recent examples,  such as internet stocks in the late-1990s and US house prices before  2008. This looks like another.  The ascent of the virtual currency  bitcoin, which recently neared $5,000 and has risen about 350% this  year, has now turned round, dropping back to $3000, if still hugely  above its initial start.  But it may be heading for a reckoning now.



Bitcoin aims at reducing transaction costs in internet payments and  completely eliminating the need for financial intermediaries ie banks.  But so far its main use has been for speculation. So is bitcoin, the  digital currency that operates on the internet, just a speculative scam,  another Ponzi-scheme, or is there more to the rise of all these  cryptocurrencies, as they are called?

Money in modern capitalism is no longer just a commodity like gold  but instead is a ?fiat currency?, either in coin or notes, or now mostly  in credits in banks.  Such fiat currencies are accepted because they  are printed and backed by governments and central banks and subject to  regulation and ?fiat?.  The vast majority of fiat money is no longer in  coin or notes but in deposits or claims on banks. In the UK, notes and  coin are just 2.1% of the 2.2 trillion total money supply.

The driver of bitcoin and other rival crypto currencies has been the  internet and growth of internet-based trading and transactions.  The  internet has generated a requirement for low-cost, anonymous and rapidly  verifiable transactions to be used for online barter and fast settling  money has emerged as a consequence.

Cryptocurrencies aim to eliminate the need for financial  intermediaries by offering direct peer-to-peer (P2P) online payments.  The main technological innovation behind cryptocurrencies has been the  blockchain, a ?ledger? containing all transactions for every single unit  of currency. It differs from existing (physical or digital) ledgers in  that it is decentralized, i.e., there is no central authority verifying  the validity of transactions. Instead, it employs verification based on  cryptographic proof, where various members of the network verify  ?blocks? of transactions approximately every 10 minutes. The incentive  for this is compensation in the form of newly ?minted? cryptocurrency  for the first member to provide the verification.

By far the most widely known cryptocurrency is bitcoin, conceived by  an anonymous and mysterious programmer Satoshi Nakamoto just nine years  ago.  Bitcoin is not localized to a particular region or country, nor is  it intended for use in a particular virtual economy. Because of its  decentralized nature, its circulation is largely beyond the reach of  direct regulation or monetary policy and oversight that has  traditionally been enforced in some manner with localized private monies  and e-money.

The blockchain?s main innovation is a public transaction record of  integrity without central authority. Blockchain technology offers  everyone the opportunity to participate in secure contracts over time,  but without being able to avoid a record of what was agreed at that  time.  So a blockchain is a transaction database based on a mutual  distributed cryptographic ledger shared among all in a system. Fraud is  prevented through block validation. The blockchain does not require a  central authority or trusted third party to coordinate interactions or  validate transactions. A full copy of the blockchain contains every  transaction ever executed, making information on the value belonging to  every active address (account) accessible at any point in history.

Now for technology enthusiasts and also for those who want to build a  world out of the control of state machines and regulatory authorities,  this all sounds exciting.  Maybe communities and people can make  transactions without the diktats of corrupt governments and control  their incomes and wealth away from the authorities ? it might even be  the embryo of a post-capitalist world without states.

But is this new technology of blockchains and cryptocurrencies really  going to offer such a utopian new world?  Like any technology it  depends on whether it reduces labour time and raises the productivity of  things and services (use values) or, under capitalism, whether it will  be another weapon for increasing value and surplus-value.  Can  technology in of itself, even a technology that apparently is outside  the control of any company or government, really break people free from  the law of value?

I think not.  For a start, bitcoin is limited to people with internet  connections. That means billions are excluded from the process, even  though mobile banking has grown in the villages and towns of ?emerging  economies?.  So far it is almost impossible to buy anything much with  bitcoin.  Globally, bitcoin transactions are at about three per second  compared to Visa credit at 9000 a second.  And setting up a ?wallet? to  conduct transactions in bitcoin on the internet is still a difficult  procedure.
More decisively, the question is whether bitcoin actually meets the  criteria for money in modern economies.  Money serves three functions  under capitalism, where things and services are produced as commodities  to sell on a market.  Money has to be accepted as a medium of exchange.  It must be a unit of account with a fair degree of stability so that we  can compare the costs of goods and services over time and between  merchants. And it should also be a store of value that stays reasonably  stable over time.  If hyperinflation or spiralling deflation sets in,  then a national currency soon loses its role as ?trust? in the currency  disappears.  There are many examples in history of a national currency  being replaced by another or by gold (even cigarettes) when ?trust? in  its stability is lost.

The issue of trust is brought to a head with bitcoin as it relies on  ?miners?, or members that contribute computational power to solve a  complex cryptographic problem and verify the transactions that have  occurred over a short period of time (10 minutes). These transactions  are then published as a block, and the miner who had first published the  proof receives a reward (currently 25 bitcoins). The maximum block size  is 1MB, which corresponds to approximately seven transactions per  second. In order to ensure that blocks are published approximately every  10 minutes, the network automatically adjusts the difficulty of the  cryptographic problem to be solved.

Bitcoin mining requires specialized equipment, as well as substantial  electricity costs and miners thus have to balance their technology and  energy investment.  That means increasingly bitcoin could only work as  alternative replacement global currency if miners became large  operations.  And that means large companies down the road, ones in the  hands of capitalist entities, who may well eventually be able to control  the bitcoin market.  Also if bitcoin were to become as viable tender to  pay tax to government, it would then require some form of price  relationship with the existing fiat money supply.  So governments will  still be there.

Indeed, the most startling obstacle to bitcoin or any other  cryptocurrency taking over is the energy consumption involved.  Bitcoin  mining is already consuming energy for computer power more than the  annual consumption of Ireland.  Temperatures near computer miner centres  have rocketed.  Maybe this heat could be ecologically used but the  non-profitability of such energy recycling may well ?block? such  blockchain expansion.

Capitalism is not ignoring blockchain technology.  Indeed, like every  other innovation, it seeks to bring it under its control.  Mutual  distributed ledgers (MDLs) in blockchain technology provide an  electronic public transaction record of integrity without central  ownership. The ability to have a globally available, verifiable and  untamperable source of data provides anyone wishing to provide trusted  third-party services, i.e., most financial services firms, the ability  to do so cheaply and robustly.  Indeed, that is the road that large  banks and other financial institutions are going for.  They are much  more interested in developing blockchain technology to save costs and  control internet transactions.

As one critic of blockchain points out: ?First, we?re not  convinced blockchain can ever be successfully delinked from a coupon or  token pay-off component without compromising the security of the system.  Second, we?re not convinced the economics of blockchain work out for  anything but a few high-intensity use cases. Third, blockchain is always  going to be more expensive than a central clearer because a multiple of  agents have to do the processing job rather than just one, which makes  it a premium clearing service ? especially if delinked from an equity  coupon ? not a cheaper one.?  Kaminska, I., 2015, ?On the potential of closed system blockchains,? FT Alphaville.

All this suggests that blockchain technology will be incorporated  into the drive for value not need if it becomes widely applied.   Cryptocurrencies will become part of cryptofinance, not the medium of a  new world of free and autonomous transactions. More probably, bitcoin  and other cryptocurrencies will remain on the micro-periphery of the  spectrum of digital moneys, just as Esperanto has done as a universal  global language against the might of imperialist English, Spanish and  Chinese.

But the crypto craze may well continue for a while longer, along with  the spiralling international stock and bond markets globally, as  capital searches for higher returns from financial speculation.
Source: Bitcoin: Blockchains and the crypto craze
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AlterNet / Could Sean Hannity's Deranged New Conspiracy Theory Cost Him His Job?
« Last post by AlterNet on Today at 06:00:04 AM »
Could Sean Hannity's Deranged New Conspiracy Theory Cost Him His Job?


The Fox News host has gone rogue in his defense of former colleague Bill O'Reilly.


 

Fox News host Sean Hannity turned his radio show into a platform for embattled former colleague Bill O?Reilly to undermine the reports of sexual harassment that led Fox to terminate his employment earlier this year, and repeatedly urged him to return to the network. Hannity?s decision to take the side of his former colleague over his employer provides more evidence that he is a rogue actor who is no longer restrained by the network.

On the September 18 edition of Hannity's show, O?Reilly portrayed himself as the ?victim? of women who he claimed had falsely accused him of sexual harassment and nefarious groups like Media Matters that had criticized him. He largely focused his fire on Perquita Burgess, a former Fox News clerical temp who had reported workplace misconduct by O?Reilly to the 21st Century Fox hotline in April. As he sought to discredit her, O?Reilly used an article on right-wing website NewsMax.com to point to her arrest in 2015 for filing a false report to the police. Earlier today, O'Reilly had urged his Twitter followers to read the "very telling" article, whichstated that the arrest ?has raised serious doubts as to her credibility.? LawNewz reported that O?Reilly?s team was actually behind the NewsMax piece, which it had shopped to at least one other outlet before it ran in NewsMax. According to LawNewz, ?The details of the arrest were so flimsy that The Washington Postapparently refused to go with it after an extensive investigation.?

O?Reilly suggested to Hannity that this was the beginning of a campaign of revenge, calling it ?the first of many that we?re going to have for the American people? and adding that he has conducted an investigation into many of the women who had reported him and it produced ?shocking? results.

For his part, Hannity said O?Reilly was ?the latest victim? of a progressive campaign aimed at getting conservatives pushed off the air, adding that he wished the two of them had teamed up earlier to oppose the ?liberal fascism? of their opponents.

Hannity also said that O?Reilly should return to Fox and repeatedly asked him if he?d be willing to do so. O?Reilly demurred, talking up the podcast that he produces on his website.

In April, Fox fired O?Reilly after a whirlwind three weeks that began when The New York Times reported that O?Reilly and Fox News? parent company had paid out $13 million in settlements with five women who accused him of sexual harassment. Soon advertisers fled his time slot in response to activism from progressive organizers, including Media Matters and Color of Change, and more women came forward to tell their own stories of misconduct by O?Reilly.

O?Reilly, who had anchored the network?s programming for decades and been deemed the ?king of cable news,? was finally too toxic for Fox. While O?Reilly denied the reports, the network could no longer publicly stand by him in the wake of the Roger Ailes sexual harassment scandal that engulfed the network in 2016. The former Fox host has, in recent days, been promoting his forthcoming book on the Revolutionary War in media appearances that double as an effort to rehabilitate his reputation. Such a media tour inevitably requires O?Reilly to implicitly criticize Fox for firing him rather than trusting him over the numerous women who?ve reported him, making it unlikely that he would draw support from his former colleagues.

But over the past few months, Hannity has increasingly chosen to go it alone, acting as if he works for his own media company under the Fox banner. Most notably, after he drew widespread criticism and began losing advertisers for pushing the Seth Rich conspiracy theory long after his network had retracted its own reports in May, Hannity publicly declared, ?I am not Fox.com or FoxNews.com. I retracted nothing.?

For his part, O?Reilly has praised Hannity?s response to the controversy, saying that he wishes he had ?fought back? in the same way. ?You certainly handled it better than I did,? O?Reilly told Hannity this afternoon.

 

Related Stories


Source: Could Sean Hannity's Deranged New Conspiracy Theory Cost Him His Job?
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Centre for Research on Globalisation / US Opens First Permanent Military Base in Israel as Tensions with Iran Rise
« Last post by Centre for Research on Globalisation on Today at 06:00:02 AM »
US Opens First Permanent Military Base in Israel as Tensions with Iran Rise

Featured image: Israel Air Force Brig. Gen. Zvika Haimovich(L) with U.S. Army Maj. Gen. John Gronski(R) at the ground-breaking ceremony for the new permanent U.S. Army base in Israel (Source: Israel Defense Forces)


Even though the US has routinely deployed

Source: US Opens First Permanent Military Base in Israel as Tensions with Iran Rise
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Centre for Research on Globalisation / Trump Again Threatens Venezuela
« Last post by Centre for Research on Globalisation on Today at 06:00:02 AM »
Trump Again Threatens Venezuela



VISIT MY NEW WEB SITE: stephenlendman.org (Home – Stephen Lendman). Contact at lendmanstephen@sbcglobal.net.


On Monday evening in New York, Trump threatened Venezuela at a dinner he hosted for hardline right-wing Latin American officials.


Ones invited included Brazil?s


Source: Trump Again Threatens Venezuela
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Centre for Research on Globalisation / UN General Assembly Convenes Under Shadow of War
« Last post by Centre for Research on Globalisation on Today at 06:00:01 AM »
UN General Assembly Convenes Under Shadow of War

President Donald Trump delivers his first speech to the United Nations today as the 72nd session of its General Assembly convenes in New York City under the shadow of war.


Little more than a week ago, UN General Secretary Antonio


Source: UN General Assembly Convenes Under Shadow of War
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Anarchist News dot Org / Santiago: Barricades and Clashes 44 Years Since the Military Coup
« Last post by AnarchistNews.org on Today at 06:00:01 AM »
Santiago: Barricades and Clashes 44 Years Since the Military Coup

From 325


Santiago: Barricades and Clashes 44 Years Since the Military Coup (Chile)





(13.09.17)


BARRICADES OUTSIDE THE UNIVERSITY OF CHILE FACULTY OF SOCIAL SCIENCES


Encapuchadxs (hooded ones) raised barricades and clashed with FF.EE (Carabineros Special Forces) in the vicinity of the University of Chile (FASCO) in commemoration of the murdered and disappeared during the civil-military dictatorship.


Leaflet found at the scene:


Today we do not simply commemorate our fallen from the dictatorship, we also claim their forms of struggle and organization that serve as an example of subversion against capital, the state and its repressive apparatus.


44 years on from the harshest episode in our history, we rise as the children and grandchildren of those who were persecuted and killed during the dictatorship.


With their same conviction, we promise to never forget their actions, which will live on in the rebellious and combative memory of every revolutionary.


via Contra Info, translated by Insurrection News


Tags: 
category: 

Source: Santiago: Barricades and Clashes 44 Years Since the Military Coup
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AlterNet / Trump's Favorite Prime Minister
« Last post by AlterNet on Yesterday at 06:00:17 PM »
Trump's Favorite Prime Minister



 
 
 



Can you guess who it is?


 

Irma, Houston, Russiagate, tax reform, and don't forget North Korea. Big stories consuming our media landscape in a country both enthnocentric and myopic, even on the sleepiest news day. So I will keep this brief. 

In 2014, after he and Najib Razak played a round of golf, Donald J. Trump gave a photo of himself to the Malaysian leader, inscribed, "To my favorite prime minister." This is according to reporting by Mark Landler, in a New York Times article, "Trump Welcomes Najib Razak, the Malaysian Leader, as President, and owner of a Fine Hotel." 

Some of Najib's qualifications for this designation may include his crackdown on journalists in Malaysia. It could be they share being investigated by the Justice Department. Or Najib's firing of investigators in his home country looking into his behavior. Or maybe it is simply because Najib stays in Trump hotels on his travels abroad. Go figure.

The Justice Department believes Najib and his cronies diverted $3.5 billion of government funds to "buy jewelry, real estate and the rights to Hollywood films," according to the Times. I guess we should consider it progress, since he was at least attempting to buy the rights to the films.

The White House avoided the traditional head-of-state photo-op hand shake with a rather stiff gathering captured by WH.gov.

Najib arrived with goodies, including his promise to purchase 25 Boeing 737s and eight 787 Dreamliners, and have one of Malaysia's biggest pension funds invest up to $4 billion in OUR infrastructure. You gotta love that. Our own Congress won't invest in infrastructure, but Trump's authoritarian friends will.

Malaysia has been cozy with North Korea, but claims to have backed off. You may remember Kuala Lumpur International Airport as the site where North Korean agents poisoned Kim Jong-nam, Kim Jong-un's half brother. My favorite tidbit is this: Najib is running for re-election, and the fact that he was able to enter the United States?without being detained?was considered a victory. Hooray!

To be fair, President Obama played golf with Najib in 2014, but long before any Justice Department investigation. President Trump seems to relish in his embrace of leaders of a certain ilk and Najib fits that pattern. Now back to our regular programming.    

 






 

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Source: Trump's Favorite Prime Minister
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Inter Press Service - Labour / Ending Modern Slavery
« Last post by Inter Press Service on Yesterday at 06:00:16 PM »
Ending Modern Slavery

William Lacy Swing is Director General of the United Nations Migration Agency, the International Organization for Migration (IOM)

The post Ending Modern Slavery appeared first on Inter Press Service.


Source: Ending Modern Slavery
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Inter Press Service - Labour / ITUC: The Global Economic Model has Failed
« Last post by Inter Press Service on Yesterday at 06:00:16 PM »
ITUC: The Global Economic Model has Failed

The International Trade Union Confederation (ITUC) has declared war on climate change and fears that the global economy is permeated by greed. Secretary General Sharan Burrow makes the point: ? Nobody can survive in a world with a temperature increase of 3 or 4 degrees.

The post ITUC: The Global Economic Model has Failed appeared first on Inter Press Service.


Source: ITUC: The Global Economic Model has Failed
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Centre for Research on Globalisation / Russia?s S-400s Will Protect Turkey From a ?Kurdish Air Force?
« Last post by Centre for Research on Globalisation on Yesterday at 06:00:15 PM »
Russia?s S-400s Will Protect Turkey From a ?Kurdish Air Force?

Many people thought that this day would never come, but it?s official ? Russian President Putin will sell his Turkish NATO counterpart S-400 missiles, and there?s nothing that the US or NATO can do about it. This is a profound


Source: Russia?s S-400s Will Protect Turkey From a ?Kurdish Air Force?
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