That virus

by Orlando Roncesvalles, March 2020 (Letter from Dumaguete)

Extreme scenarios

The virus has us all riveted to our seats, watching the news, helplessly wondering what will happen next. Will we be “shut in” forcibly, as in China? Will we be more like Italy and Spain with draconian measures to keep almost all at home, not so much by force but by community efforts? Can we have something less drastic like Korea, where there is no lockdown but massive testing allows for infected people to be isolated early in the course of the epidemic? The answers are not easily found.

A thought experiment may point to how we might go about finding a reasonable approach. Suppose there were only two persons in an economy, and we cannot tell who is infected. But for sure, one of them is sick. If both go out and work, all get infected. Both die. And we have no more economy. This is the scenario if we did nothing at all to confront the virus.

If we don’t test, we can lockdown all at home, as we do now for Luzon. That effectively shuts down the economy. But at least the economy revives when a vaccine or cure is found. This means that lockdown is better than doing nothing. Lockdown at least keeps half the population alive while we wait for a vaccine or cure. Doing nothing is something like suicide, irreversible, or worse, a form of homicide.

For the duration of the virus problem, at least two policies have the same result of killing the economy. Again, we could achieve this by doing nothing at all, or by an absolute lockdown. However, the dichotomy here applies to the differing situations of Luzon and the rest of the country. Luzon is effectively on lockdown. The rest is still deciding what to do, which to some extent amounts to doing nothing (not yet anyway).

But doing nothing is not in the cards. We are neither that callous nor short-sighted, though perhaps early in the emergence of the disease there were officials who thought doing nothing was okay.

What else can be done?

If we test, we limit the economic damage to half. The healthy one goes to work; the sick stays at home.

If we’re unable or too poor to test, we could also “just take turns.” On odd days, one works; on even days, the other works. This also limits the damage to half of the economy.

This shows that the advantage of testing is not so large if somehow we can find a way to “take turns.” This requires a great deal of social cohesion because “taking turns” is pretty much the same as the much advised “social distancing” being promoted on the assumption that all are infected but asymptomatic. Still, no testing still means that half the economy is lost. What we really want is to limit the damage to much less.

And social distancing seems better than lockdown because the latter gives us a sense of helplessness, while the former at least calls upon us to go into a cooperative bayanihan spirit.

Admittedly, the above discussion is an extreme way of contrasting the various policies we might adopt. Still, doing nothing is “suicide”; the other — lockdown or social distancing — is “half a loaf.” Having said all that, can we get a better handle at “predicting” the near future?

Background facts on the epidemic

We summarize now what we think we know in terms of science and numbers. The key parameters are the rate of infection (called R) and the fatality rate (call this F).

R is defined as the average number of others that will be contaminated by an infected person. The important thing is that there is an initial number for R, known as Ro, which is the rate of infection that does not yet take into account policy or human interventions that would reduce R. Another important consideration is that so long as R>1, an epidemic outbreak will continue because the numbers of infected persons will continue to increase. Experts seem to think that Ro is 2.3; the actual R tends to fall, even if humans do nothing. This is just a mathematical thing. Once all are infected, R cannot go any higher. Any activity that breaks the infection chain, such as physical or social distancing, or a vaccine or cure, will cause R to decline. When R falls below 1, then the disease will sooner or later “peter out.”

F is the deadliness of the virus. The fatality rate is the probability that a person will die if he is infected. Various numbers have been given. WHO says it is 3.4%. In other words, an infected person has a 3.4% chance of dying from the virus (as opposed to other causes of death), though we also know that the number is an average. Young people have a lower F; so do women; so do healthier people. We might also think that F is a constant number. It is not. The experts say that F depends on whether the health care system is able to take care of the sick, through ventilators, intensive care, etc. F is higher for countries with fewer hospital beds (the Philippines ranks low in this regard, with one bed per thousamd of population, whereas advanced countries have something like 2-3 beds per thousand).

The important thing about F is that if we can “flatten the curve,” we reduce F. What does flattening the curve mean? The curve is the progression over time of infections. This depends on Ro and human interventions to reduce R. Thus, while F and R are different numbers, efforts to contain R also reduce F.

Two kinds of economic shocks

As an economist, I ask myself what economics has to offer to help solve the problem of the virus.

There is by now a consensus among economists that the virus is sufficiently problematic that they predict a major global economic recession. By historical standards, magnitudes of slowdown in global economic activity seen in 2008 (the Great Recession) seem to be applicable to the virus. Still, comparisons with the 1930s Great Depression, which was more severe, are not so far-fetched.

In the short run, economies are subject to supply and demand shocks.

A supply shock is something that disrupts the ability of firms to produce goods and services. The important thing about supply shocks is that there is little that public policy can do about it unless it was brought about by bad public policies to begin with. A freezing up of the banking system, which almost happened in 2008, is a supply shock that was partly solved by improvements in bank regulation. The supply shock of the virus arises when people get sick and can’t work, or if they’re on lockdown, or if social distancing reduces the productivity of workers. No one knows how large this supply shock is. In the mental experiment above, even if we did do something, the supply shock is a negative 50% as total output or GDP falls by half. The WHO estimate of F at 3.4% helps to set an upper bound on the size of the supply shock. If world population is lower by 3.4%, that’s a supply shock of that magnitude; but this is perhaps too high because not all are likely to be infected. But on the other hand, the supply shock can be higher because modern economies are specialized, and supply chains cut across several areas and countries affected by the virus. I would guess a supply shock of 5% to 7%.

But that’s not all. There is a demand shock that emerges when households recognize that their incomes are lower (through no fault of theirs) or when firms decide to invest less because they predict a bleaker economic outlook in the near future. The supply shock actually starts the demand shock going, but this is magnified by attempts of households to limit consumption in relation to income. Keynesian economists like to think of a multiplier on the demand side of 1.5 to 2. This means a fall in global output of 7% to 15% if governments did nothing on the economic front.

These shocks are mitigated by fiscal and monetary policies

The lessons from the Great Depression and the Great Recession are basically Keynesian. Governments have a duty to manage demand shocks, even if they can’t do much about supply shocks. A best-case scenario suggests that the demand shock is totally “absorbed.” The most common suggestions are “helicopter money,” or outright transfers to affected households. This is a combination of monetary and fiscal policies, since money has to be printed and the delivery of the money is through negative taxes, which typically require that governments go into debt. Under such a best case, the only thing that happens is the supply shock. That still means a global recession or decline in world output of 5% to 7%. This is, to emphasize, a best-guess scenario.

Guarded optimism

Forecasting isn’t a duty of economists, but we seem to demand that they do anyway. The easy way out is to pick a guess in between the worst and best cases. Governments impose a combination of testing, isolation, and lockdowns that reduce the supply shocks. They also enact fiscal and monetary policies that negate much of the demand shock. I would venture a guardedly optimistic forecast of global recession where output declines by 10%. Individual country experience will depend on how governments manage their policy responses to the demand shock.

Key lessons

What can be concluded? The cases of Korea and Singapore suggest that preparedness is important. This can limit the supply shocks in their economies, which nonetheless will be affected by what happens to their trading partners. This suggests that globalization has inherent risks that cannot be avoided when there are pandemics.

Regardless of how prepared a country is, social interventions matter. In the case of the virus, optimism is a public bad. It is better that people assume the worst (such as all are infected, if they’re not tested) and thereby voluntarily isolate themselves from each other. We know from the mental experiment that the worst case is when the infection rate is maintained by ignorance, and when this triggers an unanticipated demand on health care systems that increases the fatality rate.

In the interim, the deus ex machina is innovation. Malthus wrongly predicted doom because he did not foresee improvements in agricultural productivity. We can easily also predict doom if a vaccine or cure is not found; but we can hope that scientific breakthroughs would save the proverbial day.

Politics, economics, rice

The paradox of advantage

The production, consumption, and importation of food (rice or grains) have posed contentious as well as analytically difficult issues even when economics was still in its infancy. In the early 1800s, David Ricardo came up with the idea of comparative advantage to explain why countries trade. On its face, it presented a paradox because comparative advantage suggested that a poor country (one endowed with limited technology) should export a good such as rice even if it didn’t have an absolute advantage in its production (it just needed to have a comparative advantage). Ricardo was also not one to advocate self-sufficiency as he was pretty much a proponent of free international trade. Today’s debate on the merits of rice tariffication presents conundrums and even unanswered questions, though the latter have perhaps more to do with politics than economics.

Bread and circuses

But even earlier, when economics was not yet a social science, kings and despots already knew that to survive insurrections, they made sure that the price of bread or grain (or any food staple) was affordable to the masses. The Roman poet (Juvenal) considered on or around 100 AD that political stability required whoever was in power to provide bread, as well as circuses! Forget the Romans. The Bible has its share of stories where kings had the burden of protecting their subjects from suffering in times of famine. Closer to home here in the Philippines, when the price of rice spiked in 2018 and became part of an inflation scare, there was a fair amount of wrangling on what to do.

Tariffs in international economics

The conventional wisdom today in economics, particularly in the textbooks on international economics, hasn’t changed much in the last two hundred years. Free trade, because it is voluntary and anchored on the concept of comparative advantage, was (and still is) a good thing. And yet, here we are in today’s age of wondrous innovations dubbed as the “fourth” industrial revolution, fulminating at the specter of rice prices remaining high for the consumer but falling to penury-inducing levels for rice farmers. What has gone wrong?

Lawmakers as villains

The twitter-verse has focused on a conspiracy theory based on an impending demise of domestic rice production. The story is that we have a heartless and gutless set of legislators who pushed what is known as Rice Tariffication, which has by now had the effect of making rice farming unprofitable (requiring all kinds of governmental intervention to support the poor rice farmers), thus also forcing the price of rice land to the levels of a song for real estate developers who know how to convert such idle lands into houses and lots. This state of events runs afoul of the Emersonian and romantic view of the idyll of (rice) farming in the hinterlands (so, planting is not a joke but it is both honorable and upright, especially if food self-sufficiency is a nationalistic priority). It is of course easy to blame the “rich capitalists” who dominate the real estate industry for the plight of the poor farmers.

The lessons of history

There is nonetheless more to the story. The historical record traces the timeline of rice farming as a battle towards high productivity and self-sufficiency that didn’t get anywhere. One study states that the Philippines imported rice from 1885. Although we had a brief heyday of self-sufficiency in the late 1960s and 1970s, the Philippines has since become the world’s second largest rice importer (next to China). The official line has been that we aimed for the three goals of self-sufficiency, high incomes for rice farmers, and affordable prices for consumers. What has been unsaid is that these goals are basically incompatible. Without a gigantic leap in domestic productivity, only the last of these goals could be attained, and only if the rice-exporting countries (such as Vietnam and Thailand) were to sell rice on the cheap.

And more. We had a commitment to the international community to abide by free trade rules (apparently, the nameless bureaucrats at the World Trade Organization believed that what was good for the world was good for us), but like a stubborn-headed child we dug in and said, no, we want to “protect” our domestic rice farmers. We opted also to engage in this protectionism by applying quantitative restrictions on rice imports (also known as quotas). The persistent WTO gave us this leeway while suggesting that an equivalent restriction through tariffs might be a better idea. So, with the apparent fiasco today, should we blame the WTO?

The Catch-22

Back to the drawing board of international economics. If outright free trade is best, what could be the second-best? Is it quotas? Or tariffs? Here, our economic managers have been caught in a Catch-22 bind. A Catch-22 is a unique situation. Applied to the tariff-quota controversy, it goes roughly as follows. Both tariffs and quotas can result in the same domestic price – higher than the world price; and the same level of domestic production (but higher than if we had free trade) and imports (at the same level as if we had simply applied quotas). But there are differences. A tariff generates government revenues, which can be collected and then misused. A quota results in “windfall” profits for those given import licenses, and is said to be a major source of corruption. In short, either way, tariffs or quotas, we face the same inevitable temptations for the abuse of public office for private gain.

But there’s a mystery that accompanies the Catch-22. Theoretically, the situation of the rice farmer is the same under either tariffs or quotas – he produces at a level higher than under free trade, and benefits from a domestic price that exceeds the world price (by the size of the tariff, which today is set at 35%). What has happened, and this has been documented by both the proponents and opponents of Rice Tariffication is that rice farmers earn less under tariffs. The unanswered questions are: Why? Is the 35% tariff too low to make its effect equivalent to that of the quota system? Is it because there is a local cartel that can dictate a lower farm-gate price under tariffs than under the old quota system? If there is such a cartel, is it engaged in a form of retaliation because they lost some lucrative opportunities under the quota system? Can such a cartel continue to operate? What if there were a political will to dismantle such a cartel?

No way out?

What seems not in dispute is that Rice Tariffication was aimed at achieving “parity” between farmers’ incomes under the quota system and under the tariff. We can perhaps argue that good intentions are not good enough. The hard question is what should be done?

My personal view is that tariffication (or quotas) was never the answer. (Neither was self-sufficiency.) It is, after all, a second-best form of protectionism that allows inefficient domestic producers to continue as they have done for almost fifty years, or even longer. We should now consider whether “creative destruction” (an idea from the economist Joseph Schumpeter) should be allowed. Let the rice farmers find other higher-value crops. Let the government support them in any way it can, especially in the provision of public goods in the form of extension services, better farm-to-market infrastructure, and a “clean” bureaucracy. But why create a P15 billion kitty (from the rice tariff) that would tempt politicians the way that pork makes them giddy with cholesterol?

As to the doomsday story that rice lands will end up becoming subdivisions, that is one for those thinking about land use policies and legislation. That is altogether another story.

Steak Intelligence

Orlando Roncesvalles

In a celebrated movie (When Harry Met Sally), we are treated to a reverential dig at the leisure habits of the first world. Restaurants in the ‘80s were, according to Nora Ephron’s writer-philosopher character, what the theater was in the ‘60s. That, after all the angst suffered by English departments in the ’60’s, was an inevitable consequence of the oft-repeated idea that the theater had died. If you believe pop music, even that (music) died when Buddy Holly took that damned plane. Why is life so tough? We don’t really know, but from today’s gadget-driven internet of things, we realize that whining is part of the human condition, amplified by social media but dulled by the haptic syndrome of touch screens, or even (by now anyway) accepted, without a nasty retort by the likes of Siri and Alexa. Machines can substitute for psychotherapists if you know how to tweak settings.

Tough is however that thing we do not accept in certain things. The night has to be tender. Terms of endearment also must be. Criticism directed at our significant others must be delivered sotto voce. And, of course, steak must with a capital T be Tender. Thus, Anthony Bourdain expressed his disdain for the despicable heathens who order their steak well done. Chefs welcome such arrogant ignorance because they can get rid of mis-delivered meat without offending a free-spending type (usually on a business account, if not using plundered funds as though that never went out of style).

What does it take to get steak tender? According to Guenther Sanin of Casablanca Boulevard fame, it must be aged and just so. Our tourism honchos don’t understand this. They ought to be bringing in technology so we would do our aging locally, but they seem fixated on media contracts and duty-free shopping. That’s what we get when we have the best and brightest officials. Tough steak. But who cares? Our lucky officials travel to exotic places, outside the country, to get their beef. Lucky them. But I exaggerate.

A steak ought to sing for itself without a backup band of exotic sauces. A-1 will hate me for saying this, but they sell something to hide the fact that we couldn’t afford the best cut, and have to do with a little ‘taste enhancement.’ A-1 is good at what it does, so give it credit. Still, I remember that a good steak-frite combo could be had in the ‘80s in a now-gone place called Le Steak in Georgetown (that place by the Potomac River), and it came de rigeur with Béarnaise. So I asked Guenther why Béarnaise sauce appears almost incognito hereabouts. The answer was that it was too special a sauce to make, and it would eat up too much expertise and good butter to be just right, though you can try some from a cheap substitute fix served up by Amazon. Basically, for authentic Béarnaise, you need expert whisking.

How often can one indulge in a steak? The answer is ‘not too often,’ because, as the cardio experts say, it can clog up those arteries. There are remedies. I had a German mission chief who lined up his statins soon after he ordered the best steak in the best restaurant in Tripoli, Libya. Then there’s also red wine. Why white wine pales is a mystery I have not explored; I look for a good Cabernet and keep my counsel. But if any white wine guys can point me to a cholesterol-cutting moscato, I’d gladly take their tips under advisement.

The end matters too. What dessert goes with steak? Le Steak had something called La Surprise de Monique (an ice cream confection with candied chestnuts in the unseen bottom, hence the surprise). In another dining room in Washington, DC, it was called Coupe aux Marrons. It may still be there; just go to 700 19th St., NW. If all else fails, there’s creme brûlée (leche flan). Deciding the best creme brûlée in Dumaguete is still on my bucket list.

SATOSHI 2.0, or how to create a better Bitcoin

Will Bitcoin survive? In what form? These are the two most pressing questions on the most popular ‘virtual’ currency, or crypto currency, today.

Bitcoin emerged along with a computing technology called block chain. Once understood, block chain promises to permit security arrangements for payment and even barter systems that are vastly superior to existing ‘centralized’ systems.

For the use of a virtual currency, the block chain has already proved itself as a solution to the counterfeiting problem while also giving transactors a relative degree of privacy. With the internet, the portability of a cryptocurrency clearly surpasses that of gold. Because of advances in computing technology, the transaction costs of a virtual currency are likely to be smaller than for existing payment systems, including the use of cash. Economists and thoughtful policy makers, including some heads of central banks, consider that virtual currencies have a useful role to play.

But the existing Bitcoin has a fundamental flaw. Its market price is too volatile for anything that aims to be a substitute for fiat money.

The problem can be traced to Bitcoin’s fixed supply (21 million coins) coupled with its lack of a ‘commodity anchor.’ The first means that the market price will be volatile, subject to shifts in demand. The latter – the lack of an anchor – underlies and exacerbates the price volatility problem.

The extreme upside is supposedly when bitcoin could supplant gold, and one calculation suggests that it would do so at $500,000 per coin. This scenario has driven wide-eyed fanaticism and speculators into the Bitcoin ecosystem.

The extreme downside, on the other hand, is that bitcoin holders could for some reason ditch the cryptocurrency and make it worthless.

In between, there could be ‘pump and dump’ scenarios, characteristic of a legal-but-Ponzi-like speculative asset that would occasionally have its Minsky Moments.

A better approach may be to think of a cryptocurrency as a ‘digital’ banknote that at least maintains its real purchasing power. To some extent, the banknotes of central banks with low inflation targets already provide the best protection there is to those who hold their monies. Can there be a better, kinder, saner version of Bitcoin?

Perhaps, if the pricing problem could be solved.

The way out seems to be as follows.

A new virtual currency, to be called, say, the bitdollar, is initially priced at par with the existing dollar. Its initial supply is then set as elastic as can be — the first ‘investors’ in the bitdollar will decide, through the amounts they commit to buy, the initial stock of bitdollars.

From there, bitdollars would go on ‘secondary’ trading just like the current Bitcoin.

If the price of a bitdollar falls below par, the initial investors would realize that they were too optimistic. Nothing else happens, and the crypto currency may fall into disuse.

But the initial stock of bitdollars is fixed, and sooner or later its price would recover if it attains usefulness as an alternative to currencies. It may then be seen as an alternative to banknotes but with a supply that an issuing central bank cannot control or alter.

When the price gets to exceed, say, 20% of the fiat dollar, by prior agreement among bitdollar holders, they would expand the supply by 10%. This should be enough to keep the price from shooting up, and also enough to keep it above ‘par.’ If the price continues to remain above 20% over parity, a sliding scale of new ‘issuance,’ say, 5% of the initial stock is calendared.

If the initial issuance is judged too small relative to (growing) demand, new secondary offerings would be issued at prices close to then market prices.

Over time, the price is likely to fluctuate in a range above par, but perhaps close to 10-15% over par. The stock of bitdollars would naturally rise to meet demand but at a price that is essentially anchored to that of the fiat dollar.

This scheme depends on the soundness of the anchor currency. If the central bank prints too much money, the bitdollar holders can or would decide to slow down issuance with a view to stabilizing the purchasing power of bitdollars. In effect, the fiat and virtual currencies will compete as different but similar moneys.

An important question: What happens to the money paid in by initial investors? I suggest that this be sequestered into essentially risk-free long-term government securities held by an agreed custodian bank. It will be set up as a trust fund to cover the possibility that the bitdollar would be unwound. The same rule can be applied to any new secondary public offerings of the cryptocurrency. This approach sets up the crypto currency as akin to commodity money, with the anchor currency as the underlying ‘commodity.’ (It is also akin to a share of stock in the trust fund holding the backing for the virtual currency.)

How would the block chain system be maintained if there is no ‘mining’ as in the current Bitcoin scheme? The obvious answer is that the computing services needed for validating the block chain will be bidded or contracted out in such a way that their cost can be recovered through fees paid by cryptocurrency holders.

Who will profit from the new scheme? As with the current Bitcoin, competing platforms for validating transactions (‘mining’), trading, and transferring of bitdollars will emerge, and would earn fees for transaction processing. Merchants who accept bitdollars would profit from paying a lower transaction fee than that paid to credit card companies. The trustee holding the backing for the bitdollar earns seigniorage in the same way that issuers of travelers checks do, and some of that seigniorage could be distributed to bitdollar holders.

Although in theory the block chain and efficiencies in computing would minimize the cost of operating the system, any crypto currency remains vulnerable to untoward events that generate mistrust in its operation. Trust in the cryptocurrency will have to be earned, requiring the participants to abide by legislation and guidance from monetary authorities. This is particularly important in combatting money laundering and use of virtual currencies by organized crime or terrorists. New platform providers who might try to cartelize transaction fees could also undermine the demand for virtual currencies.

CONCLUSION. Like Humpty Dumpty, Bitcoin is good but with its fixed supply, it is likely to take holders and speculators on a frenzied ride headed for a great fall. Caveat emptor.

Will Bitcoin crash and resurrect?

NOT BITCOIN but better.

One use of Bitcoin is for anonymous transactions, i.e., as a substitute for ordinary cash or bank notes.

The problem is that the currently available bitcoins fluctuate in value. The ideal is a bitcoin that is stable for at least a certain determinate or even indefinite time against a major currency, such as the US dollar. In short, we want or need an alternative bitcoin that is like a dollar banknote. We imagine this alternative works better than keeping banknotes under the mattress or in a safe deposit box, because it avoids thievery and the transaction costs of going to the safe deposit box.

It can be done. The easiest is for the US Fed to do it. It would allow anyone to buy something we might call the official bitcoin dollar in exchange for a guarantee that bitcoin dollars are exchangeable into US banknotes. If this works, it will be because it would reduce the costs now paid by the central bank for printing currency and going after counterfeits. In this scenario, the blockchain ensures that counterfeit official bitcoins cannot exist.

Another way is for a major private bank to ‘create’ its bitcoin dollar. Imagine that Chase does it, and calls it the Chase bitcoin dollar. All it is is a special debit card account where Chase guarantees to make the Chase bitcoin dollar exchangeable for cash. The guarantee is in effect a promise that Chase will honor Chase bitcoin dollar liabilities ahead of its any other liabilities. To ensure such a guarantee, Chase would enter into a ‘currency board’ arrangement with the US Fed by maintaining Fed fund balances in a separate special account solely for the purpose of redeeming Chase bitcoin dollars. In short, the fractional nature of the private banking system will not apply to bitcoin dollars.

The blockchain also allows Chase to ensure that no other entity can create Chase bitcoin dollars. The ‘supply’ of Chase bitcoin dollars will always be the same as the demand for such dollars.

Any other private bank would be allowed to participate in a ‘branded’ bitcoin currency. I can imagine HSBC issuing special debit cards for HSBC bitcoin dollars, HSBC bitcoin euros, or HSBC bitcoin yen. They may be allowed to compete through enhancements on convenience of use, allowing for fee-free global transfers, or even the payment of interest.

One important enhancement would be US consumer protections against fraud now being given to users of credit cards. Any merchant declining to honor a bitcoin debit card would be presumed to be up to no good.

The similarity with bank notes will have to be carried to an extreme that meets certain anonymity and privacy standards. The issuer of a bitcoin dollar will have to honor the bearer of the account provided that said bearer satisfies identity requirements.

At the same time, the use of such accounts will have to be protected by bank secrecy rules, but subject to money-laundering limits. For example, bitcoin dollar transactions in a particular account cannot exceed $10,000 per day, and a bank cannot allow a depositor more than one bitcoin dollar account. A maximum-balance limit of, say, $100,000 per account, could be imposed, in parallel with limits now applied under existing deposit insurance schemes.
Central banks could also impose limits on how many bitcoin dollar accounts an individual can have. To protect banks from money-laundering, bitcoin dollar accounts would not be available to corporations.

Will the advent of such official or private bitcoin dollars kill the existing bitcoins? It could, especially if bitcoins continue to be more attractive as speculation vehicles than as means of payment.

But bitcoin exchanges could create ‘hybrid’ bitcoins whose ‘mining’ or supply-side arrangements are fully transparent, and whose value could be stabilized in some fashion desired by the bitcoin holder. In short, there could be different bitcoins for different purposes. Caveat emptor and ‘know your customer’ rules would still be needed. However, such bitcoins would remain without guarantees similar to deposit insurance, and they may still be vehicles for speculation.

My best guess: Bitcoins will evolve, i.e., the fittest will survive. The Dutch tulip variety will become extinct. As of now, they’re pretty much as primitive as Dutch tulips.

Cell phone emergency and how to deter theft

The following instructions – from a post on FB – seem applicable to cell phones bought and in use in the USA.  But some of the instructions (on IMEI and reserve battery power) likely work globally.  The instructions on how to report theft raise a suggestion on how to deter theft worldwide.

4 Things you might not have known about your Cell Phone

(This should be printed and kept in your car, purse, and wallet.)

There are a few things that can be done in times of grave emergencies. Your mobile phone can actually be a life saver or an emergency tool for survival.

FIRST (Emergency)

Continue reading “Cell phone emergency and how to deter theft”