Wednesday, January 3, 2018 The Nugget Newspaper, Sisters, Oregon
The Bunkhouse
Chronicle
Craig Rullman
Columnist
Something
for nothing
My grandfather warned
me a long time ago that
“You can’t get something
for nothing,” which always
sounded like an unassailable
bit of wisdom pulled from
Stonewall Jackson’s Book
of Maxims. But granddad
wasn’t around for the inven-
tion of Bitcoin.
Bitcoin, if you don’t
know, is a digital commod-
ity invented by a cryptolo-
gist whose real identity — he
ran under the alias Satoshi
Nakamoto before handing
Bitcoin off to the world —
remains a mystery. In other
words, he’s the Wizard of
Oz. And it’s at least par-
tially because of this, and
other unsolved mysteries
of its development, that it’s
hard to shake off the notion
of Bitcoin as anything more
than an elaborate con.
Which is also what, in
1997, many people feared
about a newfangled thing
called Amazon, and so
missed their golden shot at
umbrella drinks and private
jets forever when Amazon
stock eventually rocketed
from $1.50 to over $1,000,
where it happily resides
today.
But even if, someday, we
manage to dodge the flying
monkeys and cruel witches
and finally come dancing
into the Emerald City with
our Bitcoins, when we tear
back the curtain to say “got-
cha,” absolutely no one will
be there to greet us.
Stay with me on this, it’s
going to get weird.
A Bitcoin transforms from
a nothing with no value into a
nothing with imaginary value
by way of Bitcoin mining.
By stringing together a
bunch of computers and set-
ting them to the task of solv-
ing mathematical equations,
a Bitcoin squirts into the
ether. When more and more
people try to mine a Bitcoin,
the equations become more
difficult to solve, slowing
down the birthrate of ghostly
Bitcoins, which is impor-
tant because the Wizard of
Bitcoin arranged this whole
scenario so that there can
only ever be a finite number
of them.
Much of the theoretical
value of Bitcoin is found in
the limit on how many there
can ever be of a thing that
doesn’t really exist. You may
want to read that again.
The result of all this
Bitcoin mining is meant to
be the invention of a new,
decentralized currency.
Which means it isn’t con-
trolled by a central bank,
which governments will
eventually come to despise
because governments, as
a rule, are in opposition to
freedom. Governments are
about control, which they
won’t have over Bitcoin, and
which was also, by the way,
the original genius behind
our Constitution. But that is
a different column.
This stuff is hard to wrap
one’s head around because,
at this early stage, when it’s
still quite difficult to figure
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out what Bitcoin is, we also
can’t properly conceive of
its ultimate potential. We can
read up on it, and see what
smart people say about it, but
in the end they can’t know
either. Not even crazy John
McAfee, who has announced
from some bunker in the
jungle that if Bitcoin doesn’t
climb to $500,000 within
three years he will consume
a portion of his own anatomy
on national television.
Perhaps Bitcoin is simply
a Big Two-Hearted thing.
But at least in Hemingway’s
story, Nick Adams knew bet-
ter than to wander too far
downstream and lose himself
in the swampier parts of the
river.
What’s also striking is the
relationship between digi-
tal currency, whose value is
based ultimately on faith,
with our beliefs in God, for
which faith is also required.
It makes me wonder if faith
in Bitcoin and other invisible
commodities is the thing that
will finally put the lights out
on our ancient yearning for
some manner of off-planet
and universal divinity.
It interests me that peo-
ple will believe in invisible
Bitcoin, but not God, and
vice-versa. I suppose there
are people who do both but
I haven’t met one yet. And
anyway, along with artifi-
cial intelligence, and the
merger of robotics with
human beings, we are well
on our way to what Yuval
Noah Harari calls the age
of Homo-Deus, which is
the now perceptible drive to
achieve immortality through
science — no God required.
I told you it would get
weird.
And, of course, the dusty
old dollar bill isn’t backed by
anything either, not any more
— and even when it was
backed by something more
than a fevered belief in the
“growth economy,” Native
Americans who watched
gold miners cartwheeling
around their sluice boxes
and yelling Eureka! thought
they had gone insane. You
couldn’t eat a yellow nugget,
and the stream’s real purpose
was to make a home for trout.
If you are waiting for the
part where Bitcoin becomes
an actual something, I’m
afraid you are going to be
disappointed. If you scratch
at the air in front of you like
a cat swatting at a pen-light,
you have held a Bitcoin.
Which isn’t really an
argument against it, I sup-
pose. I’m personally feel-
ing agnostic, although I
can admit that investing
intrigues me because the
chance to own an island in
the Bahamas and have star-
shaped sandwiches and a
Mai Tai delivered every
9
time I ring the dinner gong
wouldn’t be unpleasant.
In the meantime, I’m
calling for a currency in
Yap Stones. These enor-
mous limestone discs,
which required about a hun-
dred people to carry, were
once used as currency in
Micronesia. The idea was to
quarry the stone on the island
of Yap, carry it to Palau by
outrigger, then park it in
the sand. After that, buying
something with a Yap Stone
only required an oral agree-
ment that the ownership of
the stone had changed, and
indeed much of the value of
a Yap Stone resided in its
history.
And in one instructive
case, an enormous Yap Stone
fell out of a canoe and sank
to the bottom of the ocean.
It was never seen again, but
since everyone agreed it had
to be there, somewhere under
all that deep and dazzling
blue, it was still good enough
to trade for beadwork and
coconuts around a campfire.
What a marvelous way to do
business.
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Mark Greaney is a Financial Advisor with
PacWest Wealth Partners, an advisory practice
of Ameriprise Financial Services, Inc. in Bend,
Oregon. He specializes in fee-based fi nancial
planning and asset management strategies and
has been in practice for 17 years. Contact Mark
at www.PacWestWealthPartners.com, or call him
at 541-382-2354. Mark is located at 35 NW
Hawthorne Avenue, Bend, OR.
Ameriprise Financial and its affi liates do not offer tax or legal advice. Consumers should consult with their
tax advisor or attorney regarding their specifi c situation. Investment advisory products and services are
made available through Ameriprise Financial Services, Inc., a registered investment adviser. Ameriprise
Financial Services, Inc. Member FINRA and SIPC. © 2018 Ameriprise Financial, Inc. All rights reserved.