Quote from: DrSammyD on June 07, 2011, 09:49:21 PM

Did you know that international contracts are enforced by nobody?

There is no governing body which enforces international merchant contracts. AND YET, 25% of the world wealth is generated in this manner. Some how people are able to trust each other enough in order to trade and honor contracts regardless of whether or not government would enforce a contract in bitcoins.

Also, in most cases, it costs MORE to bring someone to court than the amount you would get back from winning the suit. So effectively, the government is not backing up those transactions. And yet, some how, people are able to have the trust to make transactions with each other.

I suggest you look up the "Folk Theorem" and "Signaling" as to how people are able to sort out their transactions without help from the state.

For more, Might I suggest this video
http://www.youtube.com/watch?v=-5PbLLBfiM8&feature=channel_video_title

This lurker registered just to post these links:

http://www.law-counsel.com/Legal_information/contract_law/
http://en.wikipedia.org/wiki/Conflict_of_laws
http://en.wikipedia.org/wiki/Lex_loci_contractus