I too would be interested in know if there are legitimate BitCoin banks out there. I suspect not for 2 ½ reasons.

First, I don't think anybody is audacious enough to do that. At the very least it implies one has a solid back office. It also implies that one has a government issued charter (with the regulation, fees, and oversight that goes with that). If a loan goes south, how do I collect? These are not unsolvable issues. I suspect that some of the ponzi sachems out there that promised a fat return or interest rates pretended to have some type of fractional reserve going.

Second, you can break banking down into 2 parts. One is the “cash handling” aspect. I have a negative opinion on BitCoin but this it does well. The second part, the fractional banking part, is to allocate capital by transmuting short term deposits into long term loans. I have a hard time imagining anybody needing a long term loan in BitCoins. Because the price is volatile, we would need to find a business that needed a big upfront loan in BitCoins for capital and was expecting to do business in BitCoins for the future.

Which takes me to my ½ reason. BitCoin users tend to be hard money types who hate loans. While I look aghast at the amount of leverage in the current system, I do think some lending (or to be more precise, some time aspect of investment) is necessary. I personally don't think BitCoin will be a real currency until we start seeing loans being made.

And when you are done with that, look up "hobby income" on the IRS website.After all we need to distinguish between the casual WoW player and the professional gold miner.

If you are a US citizen, and you have income as defined by the IRS, they have jurisdiction.

You need to strike the first two since they are both pegged currencies, Tuvalu to the Australian dollar and Barbados to the US dollar. That is, their value is derived from the underlying currencies.

And what makes a currency a currency is not how many people hold them or the might of the military. What really matters is I can live my daily life using that currency. Can I buy a loaf of bread or pay my rent? When I do any mental accounting, to I think in BitCoins, dollars, or cigarettes?

But we don't have to declare anything - it is already illegal. You can't trade in illegal goods. Period. If a good is illegal on one side of the trade, it does not matter what is on the other side. The government does not have to create a list of thing where it is. A criminal can’t say –"ha – but I used blue whales while trading cocaine – and blue whales are not on the probation list of tradable goods – ergo I can sell all the cocaine that I want".

Money is generally defined as
        Medium of exchange
        Store of value
        Unit of account
Anything that can be used as money is money. As such, money is flexible. If you think tulips, receipts (bank drafts, post-dated checks, warehouse receipts, tobacco , tulips, Dot Com stocks, cows, garbage pail kids, are money , it is. If you change your mind it does away. Currency tends to be "harder" – harder to create and destroy and tend to be tightly controled by a central bank. Read up on Money Supply and the difference between M0, M1, M2, etc. The further you go out the less something is like currency.

Technically no. Private currency has a long and rich history. However, since 1880 it has be on the decline. I can't think of any major currencies that are not backed by a government today.

Yes, but you don't always get what you want. Money (and thus currency) is supposed to be a low risk / low reward asset. Currency has low risk (see inflation) and has either 0% reward or more commonly a negative rate of return. (if not from inflation, then convince charges to hold and transfer funds. A advantage of BitCoin is that they will reduce the charges.) See countries with high inflation rates. Venezuela is my current favorite example. Argentina comes in a close second. FYI, the human brain from an organic aspect can handle inflation better than deflation.

Mostly yes. It must be a unit exchange, barter, ability to pay taxes and loans, etc. If not it tends to gimp the money, leading to inefficiencies, eroding its value. For examples, you can look at some communist countries that have issued dual currency, one that is convertible into foreign currencies and one that is not. Food stamps that can only be used to buy food and the resulting black market in baby formula.

Fireworks businesses, gun businesses, casino owners are all legal business – mind you heavily regulated.

Marijuana is illegal under federal laws even if it legal under state. A bank dealing with a marijuana dispensary runs the risk of violating laws on money laundering, which can be very bad for banks. So banks simply won't deal with them.

A place to start: http://www.npr.org/blogs/money...

We are not talking about regulating money per se, but about business regulating how business handle and use money.

State governments have a long, long history of bank regulation and oversight. This has faded as most banks have switched to a federal charter instead of a state charter. But they still have considerable oversight. What is maximum interest that can be charged, what methods of collections can occur when a person is overdue on their loans, etc. While most Liberations would oppose usurer laws, most would favor regulations on how contract law should be enforced.

Well, there you go.

I will point to this Slashdot article: http://politics.slashdot.org/s...

Read the rules closely and you can figure out it bans opening a BitCoin bank in NY. Basically, if you take deposits it needs to 100% back by BitCoins, so no fractional reserve banking.

http://www.bloombergview.com/a...

Note, I think BitCoins are an interesting experiment in currency but would make loosely money. BitCoin, with a fixed number of coins, is a hard currency. Using a hard currency makes fractional reserve banking hard to do, which makes banking hard to do, which impairs its ability to be money.

Yes, the SSL will start at 70t and move forward to (maybe) 155t.

But no, 10 13 ton lauches of the Falcon 9 does probabbly does not get you the same thing as a single lauch of 130t. Assemble is a issue. Some things are better built and have less wastage in large intergated units on the ground than assempbled in space.

We should compare apples to apples, not oranges. Which leads me to my biggest gripe about NASA (and by extension, the American government) – their plans are so murky and ill defined. Each stage of the program was like a rung on a ladder – leading to the eventual goal. How does the ISS fit into going to Mars? How does the SLS? How come we are always punting this thing down the road by 20 years. It is almost a program in search of a mission. Please don't take this as an attack on basic science and research – just how NASA does it.

Of their 144b enterprise value, only 15b is long term assets (i.e. infrastrucure) and 24b in short term assets (inventory). They don't own any employees

Most of the value is projected earnings, and those projections assume a good deal of growth in earnings - say 30%+ over the next 10 years.

Amazon has been booking profits since 2002.

The issue is that Amazon's return on investments has been low, lower than the S&P 500 as a whole. They have been pursing market share instead of short term profits. They have been investing in new risky business areas. Stockholders currently share Bezos's bullish predictions that short term sacrifice is worth the risky long game. It has worked for Berkshire Hathaway but not so well for Sony. At some point it is going to need to become a more normal company.

True.

But the SLS should be able to lift twice as much as SpaceX's future Falcon Heavy and 10 times the current Faclon 9. If we want to launch man into deep space, we are going to need something close to SSL than the Falcon 9.

I think we are mostly on the same page. My point, maximizing return in a risk / reward framework does not imply maximizing earnings this quarter. We may be arguing over language rather than concepts.

On the prospectus point I disagree. Common law and securities laws (examples would be the Securitas Act of 1933 and 1934) put additional fiduciary duties on the board and CEO that require them to work in the best interest of the shareholders. The prospectus says that the board can set the pay for the board and CEO with no restriction. The law prevents the board from confiscating a generous (or even all) of the profits for their pay. (This is kind of like your B example, but I will point out that is covered by law, not the prospectus.) See Tyco and Adelphia as blatant modern day examples. For a more subtle example, look up the various lawsuits between Craig's List and Ebay (a minority shareholder).

I personally feel you put too much emphasis on the prospectus. Yes, the prospectus 20 years ago talked about reinvesting profits – they had to fend off entities like Pets.com and Toys.com. Most companies (and their business environments) have evolved enough that 20 year old boiler plat language is no longer applicable. (The one exception to this might be mutual funds, which must issue a new prospectus every year. However, even than there is a whole host of rules that govern what a mutual fund can and can not do.)

http://en.wikipedia.org/wiki/T...
http://en.wikipedia.org/wiki/A...

Not quite.

The "book value" of equity, from the balance sheet, is assets minus liabilities. It is a accounting principle.

The "market value" of equity is the discounted (time / risk) value of expected future earnings. It is the general consensus of the stock market.

These two concepts rarely meet in real life.

It is also one of the reasons why Japan has stagnated for the past 15 years. They kept plowing profits back into failing "zombie" companies. Japan would have been much better if they had returned some of their profits to their investors so the investors could invest in the next new shinning thing. Instead the Japanese conglomerates kept everything to themselves. One could argue that South Korea's chaebol are worse.

The answer, of course, is about balance.