Bitcoin: Threat to Central Banking. Government bans of Bitcoin will fail miserably!

This is more of wrapper blog post, around another excellent blog post from Forbes I found. It has to do with Bitcoin.

What exactly is Bitcoin, you ask? Well, if you're not yet caught up with the burgeoning field of P2P digital currency and cryptography of Bitcoin, I would suggest you to do so strongly and urgently. It promises to be the future, especially due to uncertainities of massive sovereign debts being accumulated by big and corrupt governments.

Go here:

About Bitcoin

and here:

What is Bitcoin?

Even a mainstream airline like Emirates has a dedicated article talking about the Bitcoin effect in their latest in-flight magazine of February 2013. Check from page 70 (in the actual PDF file, page no. 72) in following PDF file:

The Bitcoin Effect in Emirates In-Flight February 2013 magazine

A much older article in Wired magazine from 2011 discussing early adoption issues with Bitcoin: [The title of the article itself is reactionary, considering late 2011 was very early to already declare "Fall of Bitcoin".]

The Rise and Fall of Bitcoin

To summarize very quickly: Bitcoin is a MASSIVE threat to the monopolistic hegemony of Central Banking systems all over the planet. Bitcoin is the ultimate free market monetary system. Bitcoin poses threat to the crony "Politburo" system of Central Banking which can:

• Arbitrarily fix interest rates by having a meeting of bureaucrats sitting in a conference room.
• Arbitrarily print more and more fiat money out of thin air, diluting value of funds for those who've already saved "money".
• In an extreme scenario, create hyperinflation and plunge societies into catastrophic instability.

As stated above, I would urge you to investigate more on Bitcoin at above links and elsewhere. Go on, knock yourself out. I expect myself to be blogging more about developments in the field of Bitcoin in the future.

Not surprisingly, seeing what a big threat Bitcoin can be to the Fiat Currency model, big governments of the world will not take it easily lying down to it at first. There are murmurs developing of government bans on this wildly crazy idea of free market digital currency. Free market, who would have ever thought of that?

Following is the excellent article from Forbes I found, which claims that such attempts to ban Bitcoin by big governments will fail miserably.

Government Ban On Bitcoin Would Fail Miserably

Here is the best bit:

I maintain that a government ban on bitcoin would be about as effective as alcohol prohibition was in the 1920s. Government prohibition doesn’t even do a good job of keeping drugs out of prisons.

The best strategy for corrupt governments of the world with runaway debts is to hope Bitcoin goes away or becomes irrelevant. Unless there is a single coordinated plan with the force of gun to kill Bitcoin, it isn't going away.

The genie is out of the bottle!

Goldman "Federal Bailout" Sachs wants to PUSH DOWN gold prices

OK, so today we have the Goldman "Federal US Taxpayer Funded Bailout" Sachs among a headline that caught the eye.

The same Goldman Sachs whose ex-CEO Hank Paulson was Treasury Secretary when that bailout was engineered?!? Yes, that one.

The same Goldman Sachs leading in campaign contributions for the Obamney-Rombama duopoly-monopoly political circus?!?! Yes, yes. The same one.

So in this headline, the same Goldman Sachs cries out for worldwide gold prices to plummet.

Goldman sees gold falling $500 an ounce as rally loses its shine

Because the US debt is skyrocketing, each year charade of raising debt ceiling keeps pushing it to infinity and beyond? Because borrowing US Treasuries has lesser and lesser credibility each passing day? Because the viability of Euro hangs in the balance with turmoils in countries like Spain kept suppressed with government repression? Because Japan has no signs of recovery yet out of its prolonged doldrums? Because a central bank like Bundesbank is getting nervous about credibility of US Federal Government and Eurozone to keep their fiat currencies propped up? Specifically because Bundesbank is getting desperate to repatriate large chunk of their gold?

There couldn't possibly be any ulterior motive for why Goldman Sachs would get on the rooftop and cry such a warning, could it? It must be a parallel universe that against the backdrop of realities stated above, Goldman Sachs needs to make such a sharp warning.

I'll leave you with the resource for GATA (Gold Anti-trust Action Committee) to investigate. Specifically, in order to keep the hollow empire of fiat currencies afloat, GATA alleges a well-coordinated plot by powerful international banking conglomerates to keep gold prices artificially low. Google GATA for more information. Here is the starter link:

Gold Anti-Trust Committee

Bundesbank launches simultaneous 2-pronged attack on US Dollar and Euro!

And finally: So it begins with the ringing of the first bell!

In news that is of earth-shattering consequence to currency warfare, Bundesbank [German Central Bank] drops a bomb. Well, not exactly. Mutterings regarding need to audit gold belonging to Bundesbank, but held outside Germany had been occurring in German press few months ago. So this is not exactly very surprising news. What has followed now is an all out demand for repatriation of a lot of this gold.

Bundesbank to pull gold from New York and Paris in watershed moment

Now, I'm not going to quote cut-pasted extracts from this article; because in my opinion the article commentary itself is somewhat muted. My personal take is a lot stronger.

Quite frankly, I believe this is a simultaneous 2-pronged attack by Bundesbank on both the US Dollar AND the Euro! After the fiasco of yet another US debt-ceiling raise, Bundesbank is making it clear that they have no confidence left in any hallowed status for US Dollar. It has no confidence left in the money printing one trick pony schemes of Federal Reserve. Specifically, if and when the US debt panic accelerates, Bundesbank has no confidence left if Federal Reserve will account its foreign gold holdings towards US holdings instead. On the basis of contract rights, that is a very strong sentiment and is really saying something.

Now even more curious is the attack on the credibility of Euro itself. Does that even make sense, meaning Euro being the currency of use in Germany right now? It's quite simple. What Bundesbank is doing is asserting its sovereignty over and above European Central Bank. In my opinion, they're well within their rights entitled to it. This is a perfectly logical and justifiable move. [From American perspective, the closest equivalence to this I can think of is the Tenth Amendment and state's rights/sovereignty issue.]

Against this backdrop, consider the disingenuous efforts of Angela Merkel's German government recently regarding bailouts of Greek and Spanish economies. Consider the proclamations of "wanting to do everything in their power to protect hallowed status of Euro". Actions of Bundesbank in demanding repatriation of ALL of its gold out of France seem to be diametrically opposed to the actions of German government.

It's going to be very interesting checking what official response Federal Reserve and US Government give to this demand. Most predictable response I can think of is Obama, Ben Bernanke and the new US Treasury Secretary running off to Germany, and trying to put pressure on German government to put off this demand. [Whatever is the name of this Treasury Secretary after Timothy Geithner, I'm too lazy to look it up. And in my opinion that position has become subservient to Federal Reserve anyway.] But it's not as if they have too many options. They certainly can't declare war on Germany over this issue, can they?

All I can say is, this is simply the beginning, not an end. It is likely to get extremely turbulent and interesting as things develop. Grab your [non genetically modified] popcorn and watch the action.