Die Hard Economics vs Bitcoin

Whilst changing to a connecting flight in Zurich, one overheard from the men’s wash basin that “John McLane from Vienna is asked to make his way and board his connecting flight to Miami”, the thoughts of mass panic and chaos swelled into the Gothic Economist’s mind. Gliding out of the bathroom, with the swing of a Black aluminium case and looking like the perfect 21^st century terrorist with some electronic body dance moves thrown in. He thought to himself; where would John McLane be needed soon?

The word Bitcoin very few may of heard up until recently, when it’s price surged from 11$ in 2011 to over 200$ this year. The fundamental laws that govern this virtual currency are beautiful, from freedom, to the potential downfall spike of a financial market.

The Dark Past

No one knows who the creator or creators of this virtual copper really are… Though tales are told in the Far East; and it is said to have originated from a hacking liberal collective known as Satoshi Nakamoto. This possible origin inspires the use of Bitcoin as pure freedom, so in a way this would make sense for its origin. But trusting the algorithmic workings of a hacking community for  what is now by investors seen as a very real object in the currency market, for me does spark concerns. More so are these concerns set ablaze with the value of this virtual coin being at over the $100 apiece.

No Monetary Policy, No Problem

If you are loathing of central banks and the continuous tax avoidance cleansing has rattled you to the puzzlement. The trust of your wealth management intermediary is in question? Then look no further!

The currency, being digital is not guaranteed or controlled by anything up to the heavens other than the free market. Hence for tax avoiders and people looking to acquire new safe havens, Bitcoin could prove to be fruitful. The work which occurs within Bitcoin is supply increase. There is cap currently on the currency until 2050, but until then it is up to you to solve algorithmic puzzles in order to win a few of the coins, by downloading ‘Bit miner’

Taxation & Stealth

Her majesty’s government met with figures from taxation to the online intelligence service (GCHQ), in order to discuss the problems of the new coin.

The central problem which the UK government and many others become sour at, is the notion that Bitcoin is near completely untraceable in transaction origin, and is impossible for any governing body other than the demand & supply of the free market to control. These founding rules have made this meeting turn to the operation of most likely bending these two main principles and eventuallz when they are bent, or with the help of some other countries broken, then taxation will be most likely to occur.

Uses and Commodity problems

Currently the uses of the coin movements are speculative and most likely large untraceable transactions, though rapidly online shops and services that are beginning to accept it. The only current backaches are the fears of Bitcoin becoming a commodity currency. The limiting factors of algorithms prove a big issue in dealing with this.

The coin I believe is a great step into the new way the world now works as more transactions become electronic. The frustrations I believe will come as countries try to file away at these, and then Bitcoin may take a turn for the worse.

So as we see that governments try their best to cling onto the new ounces of digital power, how will they send John McLane in, even if he ends up on the wrong side? Possibly using the powers of Tron, he will visualise into an arcade game and with 8 Bit explosions and Tetris pack punches he will fight the new virtual blanket of crime. At least Sir Mervyn King can now breath easily, that these and the remaining issues of monetary policy are not his problem anymore...Please insert coin here^^

How to dismantle an atomic Eurozone, Putin Punches & Barrels of Black

After some weekend back pressure, Spain eventually retracted from their denial, they needed money.However... the speed in which it took, was like a bullet leaving a gun, when comparing it to the other euro-bailouts, which leaves our dear Gothic analyser in pondering. How long till the others start renegotiating their bailouts after Spain's easy cash injection?

The weakness of Europe couldn't be better portrayed this week as the value of currency continues to fall, as the markets speculate the eventual truth...The euro-zone will never be the same.

On Tuesday it was announced that the banks of Europe will now be interlinked into a european banking system infrastructure that could be complete by January next year, though that is to say that we will still be looking at the same Europe by then. The banking entwining is just an extra stepping stone in the pond towards the european fiscal union. But like so many european policies an extra stepping stone might just be delaying, the eventual splash and dampness of the ever so deep Stygian pond.

Taking a leap to Syria and we see the real site of Strategic economics and Geo-political heavyweights Russia, not leaving any breathing space and taking full advantage of gaining more political might in the middle east by the revealing of arms and now helicopter gunships support to Syria. This is nothing new for Russia to supply Syria even before the Arab spring uprising first began.

In a way it is an inevitability that Russia would do this, as it is in a current position of just turning into a fuel supplier if it were not to challenge itself to keeping the fight in its corner of the ring, plus with a troubled financial world it's the best time for Russia to do it's dirty deeds.

At the same time OPEC meets in Vienna to see what to do about the collusion oil breakers Saudi Arabia, that has continued to break its quota on oil production, though as markets predict economic slowdown. Mr Gothic economist can only say, that it could be in your interest to fill up your tank before the week is out, as Saudi Arabia will either reduce its supply; or the others will.

I had a befuddled moment of clarity, where I remember how god had created economists to make weather forecasts look good. In economics we can an only assume; and as a Gothic economist I can only assume the worst, Good day to all

P.S. Do not prithee peace, it shall not be soon!

Middle East, Democracy and Civil Unrest

If you had to think of a chess match of strategic economics, this would be it.

In chess you have to be as many steps ahead of the opponent as possible, so that the main outcome is to bait your challenger into thinking that he can see your next move. The same can be said in the real world and this could be the playing game with the middle east.

Democracy is one of the stages in the building-blocs to becoming a more advanced country, but the trick is to know when that should be done, otherwise your country could stall or even worse be at the mercy of strategic interplay whether it be economics or geo-politics.

What better way to give an excuse to allow for more foreign intervention than to allow the people in the country, to remove the autocratic government and then have the temporary elected government become corrupt. This is the case in Egypt, this week the military government took action against protesting on the main Cairo square. This resulted in deaths, showing the new Egypt as unstable, allowing for more international pressure to be put on the OPEC state.

Libya at the moment is in a good position, the current governing body seems to have a good strategy to the recovery of the country and implementing democracy in the short medium-term. Also there is an equal amount of cooperation happening in Libya between the government and public, as they give ease and criticism to the transition. Libya was also one of the most developed African countries, thus for the democracy transition, it was inevitably going to be easier. Nonetheless they still had a civil war occur and bombing with NATO (though I think this was in tern for economic aid transaction for the future).


Syria remains highly unstable and also could show a more dangerous side of strategic economics... Allow the country to internally remove itself, where the remaining controller still has a wielding power. This is cost effectiveness for any country which sees a strategic advantage whether be in implementing a new government  strategy or for fundamental resources such as geographic dominance or natural resources for the example. Also external countries have less a reason to enter Syria as it's resource return is low and the public are not that cooperative.

I will continue more tomorrow on this topic, though I just spotted an announcement on 'Moody's' rating agency, which has the French AAA credit rating under view. This is just primarily down to market speculation, as we all know whether it be fundamental behavioural theory or strategic economics, the market is always proactive, though never as rational as a monkey.
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