Crypto-Economics

Stack of Cryptocurrencies Including Bitcoin and Others

Today was my day downtown. After my mindful meditation session, I took the Dash B bus to Chinatown and had a delicious lunch of Beef in Black Bean Sauce at the Hong Kong BBQ on Broadway. As I ate my lunch, I read a long article in The New Yorker about cryptocurrencies. It was entitled “The Stuff Dreams Are Made Of” and was by Nick Paumgarten. I have held back from the subject because I used to be a computer programmer myself and know how tempting it can be to game whatever system I am designing to my advantage.

People are so mesmerized by the concept of a blockchain because it is something new and edgy. Therefore it exercises a powerful attraction, especially to people who are not quite conversant with the technology.

Do you know what a blockchain is? One can’t advance far into the subject without coming to terms with the concept. Here is a link to a graphic presentation from Reuters entitled “Blockchain Explained”: Click Here. I am familiar with hash codes in search algorithms, so I feel somewhat familiar with the ground. What disturbs me is that human nature keeps rearing its ugly head and leading to the system being easily scammed. Also, I am not happy about ransomware from hackers demanding payment in cryptocurrencies, because the transfer is untraceable by law enforcement.

I am always suspicious about economic activities that require more faith than I am willing to repose in them. There is such a marketing aspect to the whole technology that one feels one were being assailed by timesharing condominium salesmen, as I was when I landed at the Cabo San Lucas airport a couple years ago.

What if cryptocurrencies became more popular than the 1% share of the global financial services market they currently occupy. Even at the current level, blockchain software requires incredible computer power. According to the Paumgarten article:

This year, it is said, the Bitcoin network will use as much energy as the nation of Austria, and produce as much carbon dioxide as a million transatlantic flights. Mining rigs—computers designed specifically to do this work—are thirsty machines. Mining farms tend to sprout up where juice is cheap (typically, in proximity to hydropower projects with excess capacity to unload) and where temperatures are low (so you don’t have to burn even more electricity to keep the rigs cool). There are open-air warehouses in remote corners of sub-Arctic Canada, Russia, and China, with machines whirring away on the tundra, creating magic money, while the permafrost melts.

I can foresee Thomas Pynchon writing a sequel to his Bleeding Edge about this activity. It’s almost as if the subject of cryptocurrencies and the high priests who run them were made to order for him.

As David Chaum, one of the pioneers of cryptocurrency software, once said, “There’s never been, in the history of civilization, this much money aggregated as a result of doing nothing.”

An Excerpt from My Book List

My Excel List of Books I’ve Read Since Early March

I know it’s a little fancy, but I’ve been messing with computers since 1964, when I was a junior at Dartmouth College. There are a lot of abbreviations and symbols which may not make sense, but which I will try to explain here:

  • Col B: A star indicates a new author I have never read.
  • Col D: If an entry is in Italics, I read it on my Kindle. A Commercial-At (@) indicates a re-read.
  • Col H: Either a miniature Guatemalan flag for my vacation reading, or a 2-character country abbreviation. FR=France, AS=Asian, GE=Germany, IS=Iceland, IT=Italy, RU=Russia.
  • Col I: My rating from 0 (worst) to 10 (best).
  • Col K: Genre. FIC=Fiction, MYS=Mystery,BIO=Biography, TRA=Travel, SS=Short Stories, AA=Anthropology & Archeology, SFF=Sci-Fi and Fantasy, DRM=Drama, YAF=Young Adult Fiction, and so on.

The first column is a counter indicating I have read 2,096 works since 1998, when I started. Now that I am retired (for now), I am reading more than ever.

 

Buried Under Paperwork

I Might Be Retired, But the Paper Still Piles Up

I give up. After I spent several hour looking for a piece of paper this morning, I have decided to order a Fujitsu Scanner so that I can keep my documents on the hard drive, the way I did at work. Bureaucracies love burying us under unnecessary documents and forms, such that the important stuff gets lost in their midst.

It is so much easier to scan the important documents and set up a directory structure by organization (Medicare, Health Insurance), year, with special filenames for the really important stuff. It was so easy at work. At home, it is near impossible.

Next: What am I going to do about shredding unwanted documents that have my Social Security Number and credit card numbers on them?

 

Computer Security Gone Wild

That Is 4 Sure!

As an IT specialist, I am surrounded by hundreds of passwords for our computer network and its users. Every system seems to have its own requirements, with financial institutions being the most demanding:

  • One or more capital letters
  • Several lower case letters
  • One or more numbers
  • One or more special characters (!@#$%^&* etc.)

As if that weren’t bad enough, some systems require you to change passwords every 90 days or so. Now the IRS has gotten involved: Users of accounting systems that store Social Security Numbers and Federal Tax IDs are required to create passwords that comply with the standards enumerated above, and moreover change them at 90 day intervals.

What is a good password? As the illustration above indicates, length is probably the best attribute. There is a fun website called How Secure Is My Password? that is fun to use. Given any password you type in, it tells you approximately how long a computer can crack it. Let’s enter a password called, simply enough, “password.” Your password would be cracked instantly. Let’s say your password is “Longer Passwords Make Stronger Passwords.” That would take a computer 89 septendecillion years to crack. You get the general idea. (I think it would actually be cracked sooner, because computers are always getting faster.)

Some people think that using letter/number substitutions such as “4“ for “for” or “B100dy Pa55w0rd5!” for “Bloody Passwords!” would do the trick. Not really. Not when a hacker uses brute computing force to check all possible letter/number/special character permutations. And these artificial passwords are always harder to remember. And you know what happens when you lose a vital password? You’re up Excrement Creek without a paddle.

What I do is keep all my passwords up to date in a Microsoft Excel file that is itself passworded. You can even create sequences of passwords, such as:

  • 1-2-Buckle-My-Shoe
  • 3-4-Shut-The-Door
  • 5-6-Pick-Up-Sticks
  • 7-8-Lay-Them-Straight
  • 9-10-A-Big-Fat-Hen

I’ve actually used that sequence for one bank (but no longer).

There are even computer programs that save your passwords for you—even Internet browsers. But if it’s a separate system, how do you know it wasn’t designed by computer hackers? It’s like all those unsolicited anti-virus systems whose sole purpose is to load viruses onto your system. It pays to be a bit suspicious.

 

Ideo-Bursts and Promisoids

The Whole Medium Is IMHO Suspect

The Whole Medium Is IMHO Suspect

About a year ago, I signed up for Twitter. But then, when I found out I was supposed to “follow” three existing Twitter accounts, I suddenly lost interest, so I never finished my application. About once a week, Twitter e-mails me to finalize my application … but I never will.

Why? A certain Prezidenchul candidate has adopted Twitter as his preferred method of communicating with the world, and I suddenly saw what was wrong with the whole setup. Standing at the microphone (broken or not), Donald Trump thinks in limited bursts of thought that are compatible with the character limit on tweets. He jumps from one tweet-length position to another. This effectively prevents him for discussing such nasty things as details that may substantiate his short ideo-bursts.

On the other hand, these same tweets endear him to his fans, who are not into such mundane things as facts. They are, if anything, practitioners of identity politics: Trump re-connects with his base, and since they identify with him, that connection is all that counts.

When you go into details, you could wind up betraying your base. So, the idea is to just skip around, making short promisoids without pinning himself down on any one of them. Promisoids good, facts bad!

So I think I will never complete my Twitter application process. And here, in considerably more than 140 characters, is why.

 

The Five Year Curse

It Seems That Computers Last for Only About Five Years

It Seems That Computers Last for Only About Five Years

Poor Martine! Every time my computer craps out, she is at the keyboard. And it’s not her fault—though it’s not easy to convince her of that—it’s just that the system just lost track of its hard drive. I hit the on/off switch and held it until the screen went dark. Then it seemed to come up normally when I punched it again.

But my Dell Optiplex 990 is now five years old, and five is a dangerous age for desktops. I’m going to start the replacement process this week and be even more fanatical about backing up my files. It looks as if I’ll have to start using Windows 10, which shouldn’t be much of a problem, as that is what I use at work.

If you see that I do not post for three or four days in a row, it’ll be because I am in transition. Wish me luck!

You Can, But You Won’t

E-Readers Are OK, but Smart Phones Are Not

E-Readers Are OK, but Smart Phones Are Not

Once I saw a website somewhere about all the devices that smart phones will render obsolete. On the list were e-readers, such as Kindle and Nook. I do not believe, however, that people with smart phones will be reading Proust’s In Search of Lost Time (in seven volumes) anytime soon. I do not even think that they will be reading many shorter books, such as 10 Haikus for the Next Millennium.

Just because you can read books on a smart phone does not mean that you will ever want to. There are four reasons for this:

  • You can only see so many words on a page. Excessive page-turning will render the reading experience too clumsy.
  • If your device is backlit, it will bother your eyes to read for any length of time. E-book readers like Nook and Kindles use a technology that does not glare at you.
  • People past a certain age (and I am already there) have trouble reading words on small screens.
  • Smart phones are so small that the reading experience is psychologically different from cradling a physical book in your hands.

I remember when Gutenberg and other websites put the complete texts of thousands of books online. In the last ten years, I have succeeded in reading only one book online: Sir Richard F. Burton’s Falconry in the Valley of the Indus. It is a relatively short book, and I can tell you it was a real chore, what with the glareback from my monitor. I believe this may also be a problem on iPads and other pad devices.

Over the years, I have long suspected that those people staring at their cellphone screens while walking are probably not reading Moby Dick.