A real world use case for cryptocurrency exchanges

February 13, 2018 § 24 Comments

Every real world economy is filled with real people, and there are all kinds of people in the world. There are always criminals, grifters, scammers, market manipulators, thieves, frauds, and tax evaders.  There are always financially ignorant monomaniacal idealists: people who don’t grasp the difference between reality and their beloved simulations and fictions; people who believe that messy human authority and fallibility can be dispensed with and replaced by machines. There are always substantial numbers of naive gamblers and bagholders, lured into getting fleeced by their own avarice and ignorance.

Cryptocurrency exchanges may represent a natural economic evolution, nature’s way of attracting many of these elements out of the real economy and into a buggy, hackable, scammable, get-rich-quick speculative open source video game.

You can think of cryptocurrency exchanges as a heat sink.  A heat sink is a large thermal mass which carries destructive waste heat away from the parts of a system where that waste heat can do harm.

Cryptocurrency exchanges are like a heat sink, except for stupidity and vice rather than heat: they are economic stupidity-and-vice sinks.  The real economy is doing very well at present, despite what is technically a very long running bull market.  I wonder if that isn’t at least in part because a lot of the insanity which typically accompanies bull markets has voluntarily walled itself off in its own video game world.  A lot of the craziness that we saw in the dot com era has literally locked itself away from reality inside an electricity-wasting computer game, at a cost of less than six billion dollars taken out of circulation.

Some people predict that the price of cryptocurrencies will soon go to zero; that they will shortly be left behind in the dustbin of financial history.  Personally I have my doubts.  I think society produces enough stupidity and graft to keep cryptocurrencies running indefinitely.  They may well stick around for a long time, as the economy’s evolved way of avoiding sepsis from what amounts to an intestinal blockage of greed and stupidity.

 

We are all Jesuits now

October 9, 2017 § 94 Comments

LMS Chairman writes:

The practice in Confession of not absolving unrepentent sinners is intrinsically related to its nature as established by Divine Law.

There is a problem with this view though. The ‘pastoral’ practice of absolving unrepentant sinners goes back to well before Vatican II, and is not a new or novel thing with the publication of Amoris Laetitia.

The Vademicum for Confessors in 1997, under John Paul II though not signed by him personally, authorized absolution of penitents who were unrepentant on contraception.

The various Sacred Penitentiary and papal audience rulings on usury in the 1800’s authorized absolution of unrepentant interest-takers in a couple of cases: specifically when those unrepentant usurers rationalized their behavior by appealing to either (1) the fact that they made mutuum loans to businessmen (condemned as an excuse by Vix Pervenit) or (2) by the fact that the ‘law of the prince’ authorized charging a certain rate of interest.

Amoris isn’t the camel’s nose in the tent: it is the other end of the camel coming into the tent.

That doesn’t make the current round of clarification any less urgent, but it is important to have a full and adequate grasp of the situation. Pope Francis is not an innovator. As the first Jesuit pope he is simply completing the centuries long Jesuit project of fighting the Protestant heresy by embracing it.

The History of Economic Thought website describes, consistent with my own understanding, the Salamanca Jesuit approach to morality in economic life and politics:

It is common to associate early Jesuit philosophers like Leonard Lessius, Luis Molina, and Juan de Mariana, with the Salamanca school.

The Jesuit Order (‘Society of Jesus’), founded in 1540 by St. Ignatius de Loyola, was erected to combat the appeal of Protestantism. […] The Scholastic doctrine of ‘just price’ was rejected out of hand as all-too-divine, the Jesuits arguing that value is a human affair and was determined by natural human interaction on markets. They followed much the same line on money and inflation. On moral defenses of usury and profit, the Jesuits were eager to reform Catholic doctrine to bring it more in line with current practice, to ease their efforts to overcome the resistance of Protestant towns to re-catholicization.

Quite more controversial was the Jesuit view of the basis of civil government, something the Salamanca scholars had largely and judiciously avoided. In line with their general approach, Jesuits like Molina, de Mariana and Suarez proposed that government rested on human consent […] Jesuit musings on the human rather than divine sources of government made them downright subversive to the established order. It did not help matters that, notoriously, the Jesuit philosopher Juan de Mariana (1598) openly contemplated that the murder of a monarch might be justified, if he proved tyrannical to the people. This was uttered at a tense time of notorious political assassinations – Henry IV of France (attempted in 1595, succeeded in1610), James I of England (Gunpowder Plot, 1605), Paolo Sarpi of Venice (attempted, 1606), etc. – in which Jesuit activists were suspected of having a role (and may indeed have had one).

In the popular mindset of the time, the Jesuits became synonymous with regicide and political destabilization.

The Jesuit approach (or, more fairly, a prominent and pervasive Jesuit approach) has always been to downplay and subjectivize the moral law as a way of making the Church seem more familiar and appealing to non-Catholics, especially Protestants. From this point of view, if pervasive everyday practice is contrary to the moral law as traditionally understood then what has to change is our understanding and application of the moral law, to accommodate everyday practice and get these people into the spiritual and sacramental life of the Church.  The important thing is Catholic unity, and if the moral law is a cause of disunity then that implies a problem with our understanding of or application of the moral law.  What is important is how people actually live, not the abstract moral demands of the Gospel.

Jesuits have been doing this for centuries, and the fruits of this approach are manifest. We are all Jesuits now.

This time Lucy won’t pull the football away

September 18, 2017 § 63 Comments

From a new article at First Things (hat tip donnie):

It was characteristic of Michael [Novak] to frame the highest good as liberation from constraint. As he says at one point, “God did not make creation coercive, but designed it as an arena of liberty.”

The free market gives us a glimpse of the ideal society, one that features order without authority and purposeful freedom without the need for agreement about the common good beyond a procedural rule of law.

Democratic capitalism does a better job sustaining an open, pluralistic society than political liberalism[1], because capitalism, unlike political deliberation, guarantees freedom more jealously (and effectively).

Yet we’ve seen setback after setback, and the corporate tsunami that recently swept through Indiana after it passed a Religious Freedom Restoration Act made clear the link between global capitalism and progressive clear-cutting of traditional religious culture and morality.

Needless to say, Michael Novak did not foresee these outcomes when he wrote The Spirit of Democratic Capitalism any more than I did when I thrilled to his insights more than three decades ago.

…he described the anthropology of capitalism in a one-sided way. Its fearsome dynamism speaks to part of our soul, but it neglects and even works against the part that cherishes permanence.

This one-sidedness needs to be corrected, for our challenges are quite different from the legacy of postwar consolidation that Michael responded to with such élan. We do not live in a closed, regulated, regimented world. Political correctness is a serious problem, and it has an authoritarian tendency. But it is not born of loyalty to permanent things. As an outgrowth of liberalism itself, this rigid ideology comes under the sign of choice. It is an obligatory, enforced participation in a fluid, liquefied moral world. We are told that we are not required to think or live in any particular way—except that we can’t think or live in ways that constrain, compromise, or even throw doubt on anyone else’s free decision to think or live differently. Taken to its logical extreme—everything is permitted as long as it permits everything—this becomes a paradoxical totalitarian toleration that is all the more dangerous because it deludes those who promote it into thinking that when they drive all dissent from the public square, they are “including.”

My summary of the article:

Don’t blame us for the poison we’ve been pumping into society for decades. We had good hearts and meant well, we just accidentally neglected to keep our nice tame liberalism on a leash. No reasonable person could have foreseen a “how were we supposed to know?” stage to inevitably follow our “what could it hurt?” enthusiasms. Who would have thought that pouring acid over the moral social fabric for centuries would make it dissolve? Who could have predicted that treating human authority and hierarchy as if it were what is wrong with the world would lead to its dissolution and reconstitution as an inhuman monstrosity?

So the thing we should all do now is correct the ‘one sidedness’ of what we’ve been doing for decades.  We need to work together to promote a nice tame liberalism in common sense balance with moral constraints and the common good.  We need more water for the shriveled up plants in our common garden, to bring balance to the acid we plan to continue pouring on them.  And that is totally, totally different from what conservatives have been doing since the founding of America.  This time it will work, really.  We have to adjust to the times, to find a renewed way for political freedom to flourish.

Oh, and that crank Zippy’s understanding of liberalism is a big strawman.

——————

[1] Translation: our intramural team in the red shirts is so much better than the other team playing the exact same game by the exact same rules in pursuit of the exact same goals, because they wear blue shirts.

You have the right to Locke yourself in a closet

September 16, 2017 § 104 Comments

Your right to swing your fist stops when your fist comes anywhere near someone else’s face.

Your right to speak your mind stops when your unwelcome or unhealthy sound waves impinge upon someone else’s ears.

Your right to promote your favorite heresy stops as soon as your heresy corrupts the thoughts of another person’s child. (Everyone is someone’s child).

Your right to commit sodomy stops as soon as any other human being is forced to know about it.

In summary, your rights operate only to the extent that your choices have no effect whatsoever on others or on the common good. Deep inside the closet, your choices are between you and God.

Of course if anyone loves you then even that isn’t, strictly speaking, your business alone. Your right to destroy yourself ceases the moment it breaks someone’s heart.

Everything outside of the closet is the domain of the common good. It is here where authority operates: where these “rights” of yours cannot negate the operation of authority.

And there is no closet.

As 33, HCN, C17H21NO4, C3H5N3O9

September 13, 2017 § 57 Comments

In America, everyone has the right to free chemistry.  Chemical acts express ideas, and the expression of ideas is protected under the first amendment.

Free chemistry obviously doesn’t mean absolutely free chemistry.  Absolutely free chemistry is clearly a straw man, positing no middle ground between manifestly insane absolute rights and nice tame rights within due limits. Everyone who is committed to free chemistry agrees that there should be some limits on chemistry. We just don’t want to live under an inquisitional chemistry-restricting tyranny.

Free chemistry means that permissible chemistry should be permitted, while impermissible chemistry should be suppressed and punished.  It means we should take a live and let live approach to regulating chemistry.

So free chemistry, at least as understood by reasonable liberals, is restricted chemistry: chemistry circumscribed within limits.  The terms “free” and “restricted” are interchangeable.  For reasonable non-ideological liberals, free means the same thing as restricted.

There have been critical times when the right to free chemistry has prevented tyranny and protected the innocent.  Bad regimes, which have restricted chemistry and even imprisoned or killed people for their chemical acts, have produced incalculable horror due to those restrictions.

So every reasonable person should acknowledge the public goods produced and protected by the right to free chemistry.

You may speak freely in the asylum

August 24, 2017 § 102 Comments

In 1689, during the lifetime of John Locke, free speech meant that a member of parliament formally charged with a speech crime committed during a session of parliament had to be tried by parliament, not some other judicial body.

In 2017, free speech means that you can say anything hateful and false you want to about white people and Christians, pollute the community with despicable pornography, and commit blasphemy against Christ (but not against the false and violent religion of Islam). Yet stating facts about official victim groups in the most apologetic way possible can destroy your livelihood and turn you into a national pariah.

There are several features of free speech regimes worth collecting in one place.

  1. Free speech refers to a regime of restricted and censored speech.  Every reasonable person acknowledges that there have to be reasonable limits on speech.
  2. Free speech dishonestly frames the question of what restrictions there ought to be on speech as if it were a question of whether there ought to be restrictions on speech.
  3. This dishonesty in framing introduces instability into free speech regimes. There is nothing intrinsically incoherent about symbolic representations or slogans which refer to complex traditions. But free speech isn’t a complex tradition of what speech is acceptable; it is a simple anti-tradition which implies that restricting speech is wrong.  The configuration of empowered speech and restricted speech captured by the label “free speech” is thus mostly implicit and constantly changing.
  4. Free speech regimes have to police speech while pretending not to police speech. The result is that methods of censorship and enforcement are mostly unofficial, indirect, non-explicit, and generally sociopathic. People are regularly punished for having violated today’s nonexplicit unofficial standard some time in the past. Free speech regimes are thus intrinsically unfair.
  5. Because of their intrinsic unfairness and instability, free speech regimes create a progressive cascade.  Whatever you say today – even though it is permissible by today’s standards – might well destroy your life in the future, so you have to be constantly thinking ahead about the progressive pieties of tomorrow and adjusting your speech to accommodate those anticipated future standards.
  6. Because it is impossible for most people to maintain a complex lie over decades, the progressive cascade created by free speech regimes requires you to try to accommodate not just your speech but your internal thoughts to the anticipated inviolable progressive pieties of tomorrow.
  7. Because liberals generally don’t grasp the implications of their own ideas, the more conservative among a population of liberals attempt to fight the perversity created by a free speech regime with assertions of a right to free speech.

Whither whether which what

August 20, 2017 § 157 Comments

“Free speech” and “limited free speech” are intrinsically dishonest phrases, because they treat the question of what restrictions there ought to be on speech as if it were a question of whether there ought to be restrictions on speech.

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