It Ain’t Fair Farrington…or…The Farrington Folly
To the Reader: This article is written to be read start to end with no need for the reader to trace the link’s and extra material reference.
That is the brevity of it. After words, when brevity hits, if there was clarity provided it might be enjoyable to then to check out the quality of my citations.
Furthermore, this article is written in response to Allen Farrington’s Inflation In A Hyperbitcoinized World to which I will pull out the important parts for the reader. No reason at this time to check out Farrington’s work before I point out something important about it.
To that regard we skip immediately past one of Farringon’s widely held pieces A Tale of Two Talebs and move straight to a passage by Nassim Taleb from his Bitcoin black called Paper Bitcoin, Currencies, and Fragility (remember you aren’t supposed to check these citations out until after I achieve brevity):
Keeping in mind the story of the Sztorcian Complaint (but not visiting the link yet) Taleb is completely exposed and his (yes Allen “fragile”) reputation smashed once we try to replace the word “inflation” with the implied definition he might mean.
The first use of the word inflation in this passage is nefarious as it intended to fool the audience.
There can be multiple definitions for a word, inflation has many, and their relation is actually very complex. One definition for inflation is simply put that prices go up, or more formally:
...a general increase in prices and fall in the purchasing value of money.
This confuses people because they think that this definition is in disagreement with central bank’s attempts to control and target inflation- such action of a central bank can better referred to as “CPI inflation”.
These are not the same things and that is part of Farrington’s folly.
Taleb writes “..the orginators, miners, and maintainers of the system currently make their money from the inflation of their currencies….”.
The casual reader can ignore this note: there is an absurd interpretation I avoid here by replacing money with profits that I won’t go over for brevity sake’s.
They CAN’T make (profits) from their own currencies because their own CPI inflation is rising NOR if the purchasing power of their currencies is falling.
So what definition is Taleb using? I conjecture to the casual reader Taleb is meaning:
They make their (profits) from an INCREASE in the purchasing power of their currencies.
He’s using the OPPOSITE of the above economic based definition:
the action of inflating something or the condition of being inflated.
“the inflation of a balloon”
Who is the intended readership that would catch this subtly without help from the author or this author? Why is he using the word in complete contrast to the way he uses it elsewhere in the paper without giving the reader a warning?
You see Talebs writing doesn’t actually parse, it’s just meant to look as though it does…
…who caught this?
BREAVITY ACIEVED but let’s move on….
And Now For Something You Will Really Like… Or… Bippity Boppity Boo
Don’t leave this article yet but I want to provide clear evidence as outlined in The Coppalian Complaint that Frances Coppola is guilty of the same type of nefarious and career ending writing and action. I saved images of her tweets because you probably can’t access them through the links I provided.
Frances once said of me I “…know f#@% all about monetary economics.”
Paul Sztorc once said I have a reading comprehension problem.
Frances once wrote a blog called Arithmetic for Austrians in which she tricks the readers by introing with perfectly plagiarized economics 101. We can observe Coppolian Knots and unravel them not by READING her work but by PARSING it:
Exuberant coin creation is made possible by a wholly irrational belief that there will be enough US dollars to enable everyone who has bought into this hyperinflationary ecosystem to cash out at its vastly inflated prices.
She referenced the word inflation in two distinctly different ways in the same sentence because she doesn’t have anything intelligent to say. The writing is meant to pass a scholars glance and fool the causal reader and critic.
Let’s parse her words from this interview (bonus effect if you watch this part in slow motion):
Farrington Theory of Price or Farrington’s Folly
In Farrington’s Inflation In A Hyperbitcoinized World he means to respond to Izabella Kaminska’s claim “…there could be inflation in a hyperbitcoinized world.” (that’s not a Kaminska quote but Farrinton’s summary as I understand).
Farrington summaries the inquiry again later which gives clearer meaning to the intended definition of inflation from his view (and perhaps Kaminska if we are interpreting her intentions correctly):
Can the price of stuff ever go up in a hyperbitcoinized world?
This is a reasonable interpretation since a hyperbitcoinized world implies there is no longer centrally banked currencies that target CPI inflation.
REMEMBER that a measure of CPI inflation is NOT the same thing as saying: “…a general increase in prices and fall in the purchasing value of money.”
So how do we parse Kaminska’s inquiry and approach the Farrington Folly?
We turn to A Bitcoin Fiat Proposal written in collaboration by yours truly and some others notably including Shinobi aka @brian_trollz who refused to put his name on it because of the last line (feel free tell him I say hi!). In regard to a special consideration for the development and future of bitcoin:
The goal is not stabilization of purchasing power, which is an impossible feat, but the removal of the political component of respective national money supplies.
And in which we reveal Kaminska’s claim would actually be a boon for our society:
Consider a scenario in which Bitcoin becomes globally adopted as a currency. If the price trend in Bitcoin terms of a certain good in country A differs from that of the same good in country B, this would signal a difference between each country’s supply and demand curves of that certain good as opposed to differences between each country’s monetary policies.
In the second scenario, where central banks successfully value target Bitcoin, any differing price trends of a certain good between country A and country B would also reflect the differences between local supply and demand curves of that certain good in country A versus country B.
Both scenarios describe a comparable and favorable result in which the local price signals of goods are conveyed free of the noise created by political intervention in the supply of money
Now we leave to the reader a charge: Try to parse Farrington’s work.
A special thanks and apology to the #1 bitcoin podcaster Peter McCormack who politely asked me to stop bugging him and I didn’t. If you found brevity in this article perhaps you can let him know of it.