Dividing by Zero

Dividing by Zero represents a series of publications which included criticism of the existing monetary system and policies of leading central banks, drawing attention to the irregularities in the global market. Chapters of this publication also provide insight into the meaning of cryptocurrency system, analyzing its potential, directions and the time frame in which it could become an alternative to the existing monetary framework.

Introduction

Growing number of irregularities that occur on the global market, such as currency wars, illogical implementation of zero rate policies and expensive QE programs are another reason for growing trust in bitcoin, since it is not a subject to control of any single institution, having in mind that the level of its demand is the key factor that determines its price. (Read more)

1. There’s No Way to Be an Optimist while Zero Rates Appear

When the whole economy is flooded by inflationary cuts of the central banks, which offset deflationary barely pushed more and more violent and when, at the same time, figures related to bank ratios, unemployment, growth are more than just problematic, the reality is complex and hard. (Read more)

2. The Danger Zone – Where Nominal Yields Do Not Effectively Reimburse the Risk of Collapse

The ordinary interest rate is one that reveals the intercession among the current and the upcoming, while there is expectation of future prosperity, and this is particularly the reason why interest rates are the highest in the poorest countries, since the loss of time is negligible. (Read more)

3. Boom Supported by Nothing but the Debt Never Leads to Real Growth

After the crises governments have added billions of dollars to their public debt, and if we look at the previous data and at converted value of dollars from the historic to the current one we see that what has been done in the past eight years in most countries exceeds the amount of debt of the whole XIX and XX century. (Read more)

4. Deflation —  Yesterday’s Problem; Inflation —  a Problem of Tomorrow

The increase in liquidity caused by Q.E. does not wash out the real economy, but is largely directed towards the financial sectors. The EU benefits less from the wealth effect of an increase in stock market assets than in the United States, where pension funds or inducements make income more responsive to market conditions. (Read more)

5. Understanding Blockchain: The Main Objective and the Initial Challenges

One of the main principles is that the collateral must be revalued at standard time, such as daily or in every few hours, in the same way as the accumulation of contracts or open positions it is supposed to wrap, associated with the market price of the security on the market. (Read more)

6. Zero Rates – a Symbol of Inefficiency and Nonsense

There are big differences in assets between a rate that goes from one to five percent, measured up to to those that would go from zero to one percent, since zero point  is mainly due to the fact that dividing any number by zero is not possible. (Read more)

7. When a Rescue Plan is an Obstacle to Recovery

The Dodd-Frank Act was adopted after the 2008 financial crisis in order to enforce capital inflow and annual stress tests performed on large banks, whose insolvency may create risks to the global financial system, ensuring that they would hold out financial shocks. (Read more)

8. Medium of Exchange Rather than the Tool for Value Accumulation

Bitcoin is not a commodity money, nor a fiat currency, since it has no required price. It shares are not being backed by a material asset, since it has value only because economic actors agree to use it in cases where the internet facilitates exchanges between them. (Read More)

9. ECB Is Hiding Public Debt Instead of Stimulating Growth

All of the liquidity boosters made the euro more plentiful, which decreased its value, first of all against the dollar, causing it became cheaper in terms of interest rates, while on the other side these financial actions constitute the access of the unsound environment of public debt. (Read More)

10. Rematerializing the Upper Limit of the Debt In Order to Be Renegotiated

It might seem unclear whether the influence of the USA comes from its GDP that is still as high as the real economy is in underprivileged shape, so there should be highlighted that most of the wealth produced in that country this way is, in fact, fabricated and comes from financial or banking yields. (Read more)

11. The Latest Rise the Price of Gold – a New Cause for Concern

Regardless of the prospect of a stronger dollar and a rise in U.S. interest rates, there is still vagueness at the global level today, both economically and geopolitically. This made the investors recognize that they have to look for alternatives to the green currency. (Read more)

12. Crossing All Barriers between Nations, Policies and Cultures

Bitcoin is the most common, the first decentralized and the most valuable digital currency that represents means of payment on the internet outside the control of any financial, national on international institution, or a single company from any industry. (Read more)

13. Encouranging the Growth of Indebtedness Is the Crime Against Humanity

The years of recovery from the global financial crisis are characterized by the phenomenon of negative effects that point to the detrimentalities of the overall concept on which the monetary policy of the leading central banks in the world is based, with the European Central Bank leading in flaws. (Read more)

14. ECB’s Policy, Like the Code of Hammurabi, Does Not Abolish, But Just Regulates Slavery

There is still an ongoing process of finding the way to finance these projects of the real economy, garnering capital gains and collecting interests and it is shown as extremely hard during this type of political control of the central banks that will not change a flawed monetary. (Read more)

15. Overseeing the Ultimate Impact on the Principles of Real Growth

There is a belief that the negative interest rates only concern banks, which perceive their deposits with the ECB not rewarded, but commissioned, up to an annual interest rate that is still under zero percent. In reality, there is not a single entity that could borrow from their bank at rates below zero. (Read more)

16. The Need for Encryption Created a New Way of Living

The name of the most common cryptocurrency, bitcoin, also refers to the protocol describing this virtual money and its implementation in the payment system. This cryptocurrency is decentralized and anyone who wishes can join the network by installing the software. (Read more)

17. The Impact of the Virtual Money Mechanisms on Total Cash Flow

Through a review of the relationship of trust in cryptocurrencies, as well as trust in institutions in this work is estimated what impact will the mechanisms on which is based the virtual money have on total cash flow in the future and what kind of perspective of bitcoin and other cryptocurrencies. (Read more)

18. A Great Turnaround in the Financial World

There were numerous studies on the supremacy of common goods and a certain sort of digital collectivism that have shown that the fact that this group of enthusiasts has no centralized organizational control does not necessarily mean that the whole system is expected to be reduced to into disorder. (Read more)

19. Value Justified by Usefulness and Scarcity

Central banks are able to influence the foundation of money throughout the refinancing rate, but also by calling commercial banks to place an assured amount of deposits accumulated from the community on the account that banks of the central bank in forms of reserves. (Read more)

20. The Multiplication of Mediators Reinforces the Strength of the Protocol

ECB’s document “Virtual currency schemes” explains what are their standpoints regarding virtual currencies and in what way are they supposed to differentiate from electronic currencies that have physical corresponding item, such as banknote or coin, even if this element could evolve for the bitcoin.  (Read more)

21. The Exchange Rate Fundamentally Depends on the Balance of Payments

Electronic money keeps hold of a strong connection with traditional money since both of them are articulated in the same unit of account and are pledged on an asset, while bitcoin relies only on an agreement between their users, without a legal framework drawn up by any centralized body. (Read more)

22. When Structural Currency Must Constitute a Store of Value

Any symbol and any code correspond with a factual or essential object that can find its place in it, certifying the date given to it by this global network. For instance, it may certify credentials, communication, contracts, and proofs of claims, identification or assets to be insured.  (Read more)

23. The Advantage of Divisibility into 100 Million Subunits

Traditional currencies have a benefit of having lower units that allow performance of transactions of smaller value. In this sense bitcoin has the biggest number of advantages because it is exceedingly divisible, since every single bitcoin can be divided into 100 million subunits called satoshis. (Read more)

24. Market Formed between Chain Payments, Secured by Minors and More Customary Off-chain Payments

Transaction of zero nominal value apparently cannot pay large commissions, which goes for what creates the burning of the currency, for instance in time-stamping a document. For the monetary authorities, running the conversion between old and new organizational supervisory models is certainly not simple. (Read more)

25. Determining the Mechanism Used within Blockchain System and Enabling Acceptance

The diversity of fields of application will favor the existence of different payment systems, hence different units of account. As it is the case with other blockchain backed cryptocurrencies, the bitcoin was created from a computer technology that represents transmission technology without central control.(Read more)

26. Denominating a Secure and Distributed Information Shared by Various Users

The key problem that was visible from the earliest days of blockchain development was that the current banking system that is planned to be improved is that it requires outsized technical resources, as well as huge number of people on each side involved in these parts of transactions.(Read more)

27. Focusing on Bitcoin Combination in Conjunction with Fiduciary Currencies

According to the study by Accenture there are reasons for optimism in banks that plan to implement the elements of blockchain in their further transactions, as it estimates that this movement could save up to 12bn USD each year thanks to the application of this technology to back-office function. (Read more)

28. Usefulness for Data Management, such as the Cost of Index Reproduction

In order to continue control over their systems, experiments are accumulated around private blockchains, where only a limited number of players can record transactions or have the registry. Public blockchains are more complex to use for banks that do not want to lose control of their content.(Read more)

29. Formation of a Private Blockchain Explains Optimizing the Reconciliation Procedures between Financial Institutions

The battle between customary payment systems and peer-to-peer payment systems, and therefore between state currencies and cryptocurrencies, is likely to be the subject of regulation. In the camp of bitcoin and its derivatives, two positions are already taking configuration. (Read more)

30. Defining the Level of Soveregnty in Comparison with the Position of Leading Central Banks

The increase in liquidity caused by quantitative easing programs does not wash out the real economy, but is largely directed towards the financial sectors. The accumulation of public debts has reached such a level that monetary policies will have to transform and inflation will make its return. (Read more)

31. Currency Wars Due to Introducing Monetary Incentives through Money Printing

Changes in exchange rates were conditioned by political and economic developments in the countries that use them, but also moved that behind the scenes pulling the leading banks in the world, after which it seemed that once completely reliable guarantor factors are not expected to reverse the trend.(Read more)

32. Misuse of the Currency Derivatives Causes Losses that Affect the Entire Society

Markets, particularly futures, of certain listed goods have already reached the level at which the traffic is based on trade agreements that go beyond the actual stock exchange stocks, thanks to the fact that traders futures are not looking for the physical delivery of goods over which have ownership.(Read more)

33. The Currency Market is Excluded from the Productive Economy

Countries that are largely trying to overcome this problem are trying to maintain control over all available mechanisms and a set of convergence criteria on the basis of which enables the use of the euro as well as the restraint of conduct aggressive monetary policy of ECB are just an attempt to keep control in this area.(Read more)

34. A Widespread Decline of Confidence in Euro and Dollar

A lesson as such can be drawn from current trends and orientation of a large number of market investors is decline of confidence in the euro and dollar, as well as the announcement of a new, gradual redistribution of wealth, which is initiated by distrust of citizens in the financial, primarily banking system. (Read more)

35. Using the Mechanisms of Cryptocurrencies in Regular Cash Flow

In private chains cryptocurrency there is no element which completely defines the characteristics of the chain, without the possibility of observing it somewhere else, where, in fact, lie all potential transactions in such networks, because of defining values for exchange, storage, withdrawal and allocation of resources. (Read more)

Advertisements