Quote from: kkaspar on February 28, 2014, 02:20:50 AM

Quote from: Erdogan on February 28, 2014, 01:37:08 AM

There are two reasons why "countries", really governments of countries, wants fiat money in stead of sound money. Number one is that they can repeatedly, without their subjects discovering, steal from the money supply.

Fiat money and sound money aren't opposites. There are fiat that are soft and there are fiat that are hard. People are whining that money isn't directly connected to gold anymore and they don't even bother to study why. Instead of gold, today we have the petrodollar, where the actual thing that gives value to the dollar is oil that has better practical value and less speculative value.

How come can the government, or more specifically an politician, steal more in case there is a steady inflation rate?

There is no such thing as petrodollar. If you have dollars, you can not redeem it for oil. Dollar is used for trade in oil because it is an international market, and dollar is the best fiat for that. There is nothing special about oil or energy as goods. It is products that are useful, nothing more, nothing less.

When a fiat is inflated, new money is created and the owner of the new money is the government.

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Quote from: Erdogan on February 28, 2014, 01:37:08 AM

Number two is that they think they can force investments through the zero interest rate policy. They can not really, because the credit made available goes to suboptimal production, sometimes even capital consumption, taking everybody down in the process.

Sound money (of which bitcoin is an example) is in the interest of everyone except governments of countries.

Problems with suboptimal production and capital consumption come from places that lacks education, tradition and culture. I think you are right on that, there is a connection there on how more developed societies can handle themselves better under more intensive investment pressure. There could be a rule that less developed countries need stable deflation rate instead. But.. in this subject we are talking about bitcoin, that has no stable deflation rate. It is volatile and with a never-ending rise. It's a beautiful piece of art, but it has no place in serious finance because of that.
It's job is to introduce the entire subject, so it needed to be attractive to the regular folks who believe financial fairytales. Through regular people, the subject can also reach more influential people, who can start implementing the realistic parts of that idea to everyday finance.

For people who have access to loans with interest rate lower than the price increase, it is optimal to invest in businesses with negative profit.

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There is no use trying to convince me that bitcoin can survive more then couple of years, before it will get eaten by competition. To me it sounds like, when someone is the first to struck oil, and then no one else on earth will drill for oil any longer, because someone else already did it. Creating the perfect digital currency will soon be the holy grail to everyone who consider them to be geniuses at software engineering.

The reason for each government to have its own fiat money system becomes clear when you understand the reason for having fiat, described above. Since there is nothing in virtual currencies for governments (or any other group), there is no natural tendency to have many. For producers and consumers it is best to have one universal currency, therefore bitcoin clones will have a hard time. There must be a good reason for an altcoin to thrive.