Currency

@hubatmcjuhes how can BitCoin have a limited supply when it is infinitely divisible?

Micro-BTC are already being traded, divide by 10⁶ start trading pico-BTC.

In 10 years one coin could have the value of the entire current supply, but still it wouldn't be in any way inherently limited.

@adambullen There are about 21 million bitcoins (already mined or not mined yet) and there will never be any more. Dividing them into tinier pieces doesn't change that at all.

That the exchange value of a deflationary currency rises over time compared to an inflationary currency would exactly be as expected. And - if you are right with your prognosis regarding bitcoin - this would only prove my point.

The question that I would like you to answer is: If you believe what you propose about the development of the value of bitcoin: why would you ever want to spend one (or any part of one) unless you must?

@adambullen the trouble with Bitcoin is that it is not well designed for security, or economics.
1 a. I believe the main problem with the economics of Bitcoin is that it is designed to be a libertarian wet dream where only the first 0.1 % have any chance of amassing a collection of coins.
Naturally, the entire process of mining is also rather energy inefficient now, and provides further barriers to the currency.
1 b. The security is clearly not made by anyone with half a clue how encryption systems work in real life, which is why Bitcoin wallets are so vulnerable to tampering.
For those reasons, and others which the GCSB is also well aware of, a responsible stock exchange would not deal in Bitcoins as it fails to meet security standards necessary for finance.

@HubatMcJuhes 2 a. there is nothing to stop a crypto-currency from being used to trade in Land Dollars, however I do not think that system should be the only use for a crypto-currency.
2 b. The main problem I have with Land Dollars is that I think that it will be used unscrupulously by local authorities to raise additional taxes without being held to account for it. I do not think we need councils to be given a new large source of funds which they control alone.
3 a. Keynes is relevant today as the economic remedy to the austerity of both the great depression and the global financial crisis.
3 b. There is bound to be room for development in economics, so long as it is not the idiocy of austerity and tax cuts for the rich funded by a firesale of state assets, then I am enthusiastic.

4 a. Strictly speaking inflationary economies are preferred to deflationary economies, as the difference is that in an inflationary economy spending is encouraged, which leads to growth.
In a deflationary economy like Bitcoin, the incentive is to save your Bitcoins rather than spend, so the economy slows down into recession as trade is less profitable than saving your Bitcoins for later.
4 b. Bubble economics would be best left to John Key and the farmer MPs in the current regime, they have all the experience of it. ;-P

@adambullen 5 a. Bitcoin is divisible to 8 decimals, but the entire mining process shuts down in 2140 when Bitcoin 21000000 is mined and no further Bitcoins are created.
5 b. The main problem is that the entire economy of Bitcoin is designed to enrichen only the first 0.1% of Bitcoin miners significantly, it is not in any means fair to all comers, or even meritocratic.

Do we need anti money?
http://iopscience.iop.org/1367-2630/16/3/033024/

So I finally read the full land dollar description from the new economics party.

It puts up some interesting ideas, but it seems that the example they give of this being a working system from 1040 - 1280 is a poor parallel with the world of today, mainly due to physical mobility.

Basically as a contract engineer, I work in various regions, if I work for company X in Auckland and get paid some portion of Auckland Currency I can't then spend that currency at home in Taranaki.

Equally this works in the reverse situation, I have some Tananaki Currency that I earned whilst at home, but I have a 2 month contract in Auckland, I have to spend all my NZD as Auckland doesn't accept Taranaki Currency, this impacts on my ability to pay business tax which is a NZD only transaction.

I think some of the ideas raised are really good, such as holding land and improvements as effectively separate entities and thus separate transactions. I also like the idea that the interest portion of the land loan goes back into the local community, but this would massively increase the debt held by the local councils which don't have a great record in this regard.

But I also think that adding a bunch of local currencies just adds to the inefficiency of the overall monetary system. It would lead directly to a kind of internal FOREX market, where Auckland Dollars are traded for Wellington Dollars and NZD are traded with Christchurch Dollars. Suddenly speculators having a new market to play in.

The other problem is the local currencies would inevitably be small (a few hundred million in value), and thus subject to large swings in value as individuals or corporations could theoretically purchase significant portions of the active currency at any one time.

@adambullen
My understanding is that you would pay taxes in Land Dollar, not NZD (but you could if you had reasons to prefer NZD).
Certainly would the exchange between currencies need to be easy and cheap. This can be easily implemented nowerdays, e.g. via a cryptocurrency.
As the Land Dollar is fully backed (or am I wrong here?), there is little to no space for speculation, swings and the like.
Not sure what you mean with the massive increase in debt held by local councils. Where does that come from?

The model used dates from serfdom to your feudal lord, which is why the scheme doesn't account for modern mobility as @adambullen has already stated.
It is not uncommon for people to move around the country just for a holiday weekend, let alone for a work contract.
As this would result in people discriminating economically against Land Dollars from areas they have no plans to go to, this would result eventually in a greater degree of economic centralisation in the main cities. It would not work at all well for those Land Dollars which aren't holiday destinations, or the like.

Imagine if you will, that you are at the Tui brewery and try buy some Tui beer with Land Dollars from Fielding.
Do you really think anyone in their right mind would want to find something worth buying in Fielding ? It's not like there is a variety of shops there.
So obviously, there would be little incentive for people in Fielding to be paid in Land Dollars, as they would at least want to be able to shop in Palmy North.

@hubatmcjuhes the antimoney idea could work in my cryptocurrency, so long as a small debt threshold applies, and that a tweak for money mining is made.

@andrewmcpherson the Land Dollar is designed as a parallel currency, not a replacement of the NZD. You wouldn't deal commodities in Land Dollar, but land, taxes and the right to use resources (CO2, water, hydrothermal energy,..)

@hubatmcjuhes Land is a commodity that should not be locked up to the whims of local councils and I am highly doubtful that most councils can be trusted to manage resources effectively.
There are some arguments that councillors can't be trusted to make decisions about water given how easily some fools listen to fluoride conspiracy crackpot theories by quack propagandists.
Personally I would prefer that those decisions are made by central government bureaucrats and not subject to political interference.

Back to the topic of economics, it is generally accepted that the serf economy model, as used by the land dollar will only benefit the extremely wealthy and those who would prefer the medieval western Europe definition of freedom: ie: freedom comes to those fortunate enough to be wealthy.