"Your paper dollars say “legal tender for all debts, public and private.” If you owe somebody $20 and you “tender” a $20 bill, technically the debt is paid, whether the person accepts the $20 or not."
Aggravatingly this law is not recognized by the PA DMV. In many locations they refuse to accept cash as payment, presumably because their staff keeps stealing it. How this continues, and how one would get the law enforced, elude me.
Since it is a government agency, you could probably sue for an injunction to require them to accept the cash. But you would not get your attorney’s fees back, or even your court filing fee, so ... you’d better owe them a lot.
This has actually come up in a number of cases, and the holding is almost always to ignore the physical object implication of the "this note" language printed on bills, and instead to say that government agencies must accept "money" for debts or fees denominated in, well, money, but that they do not have to accept it in the form of cash and physical notes. States are allowed to compel businesses to accept the physical notes.
It is supposed to be sufficient that there exist easy and affordable ways to convert physical cash into value stored in money payment mechanisms the government will accept. A lingering problem is the sui generis case of cannabis dispensaries which (1) deal with a lot of cash, (2) are legal under state law and while illegal, tolerated and not prosecuted by federal policy, and (3) can't get most bank-like services (a worsening problem, but common carrier rules are uncool, I'm told). The dispensaries are told to pay taxes in money, but they aren't allowed to convert their cash into money. Well, they tend to find a way (cough, lawyers, cough). Better call Saul!
How the courts can worm their brains through the logic of "this note" not meaning "this note, right here, that these words are written on" is beyond me. There is just so much wrong with that. Either remove the legal tender rule, or apply it. Damn guys.
Also agreed on the common carrier bank rules. If the Fed gets to decree who is allowed to be a bank and who isn't, those allowed to be banks really should be common carriers. It isn't as though the Fed is just giving away banking licenses to anyone who asks for one, so in effect it is sharply limiting competition while allowing those benefitting to skate around serving everyone and not worry that they are losing market share to competitors. I know the DEA and all them are on that crap too, but the whole thing is a mess. Common carrier style requirements for all regulated closed order industries (where you need a license to be one) seems like good policy.
There is a lot of libertarian opposition to common carrier requirements, but I think most of that only makes sense if one is seriously underestimating the uniformity and degree to which the companies in these sectors are government-obedient. Most charitably it's just a huge empirical error regarding the value of a particular political factor. But if one makes that error, one is letting oneself be fooled into thinking that the border between private and public is clear and solid instead of fuzzy and porous, which creates a convenient route for the state to circumvent constraints and launder otherwise improper state action through complaisant companies eager to please and dependent on its favor. This is now the go-to successful strategy for the expansion of state power beyond what few walls we have left.
If you don't make that error, you will see that what seem like restrictions on """private""" companies are in reality the same restrictions on the state and intended to deter the state from pursuing this strategy, just at the point where the state has extended the tips of its foul tendrils inside these puppets.
I very much agree. I think a lot of people, even libertarians, have underestimated how much the state has gotten its fingers into the market lately. The number of jobs and businesses requiring licenses way up over the past decade, and the amount of regulation used to control business behavior has increased almost as fast as the government's willingness to leverage it. Many industries are essentially state controlled, not in the literal "the state owns the companies" sense, but in the sense that the state controls entry, that is, who gets to be in the industry.
So far as I am concerned, first best solution is to drastically slash and burn that control, back to where anyone can start any business and the state cannot lean on mafia style, "Nice place you got here... be a shame if the EPA were to shut it down" regulatory extortion. Second best would be to say that if you are in a, say, "non-shall-issue license industry", you have to be a common carrier. If the state (or other group wielding state power to keep you out of business) is limiting competition entry to your industry, you have to be a common carrier (or just be liable for your content, perhaps.)
I do feel a little sympathy for banks regarding things like "Know your customer" style regulation, and that sort of stuff should really go. If we can't get rid of that, well, Citigroup just isn't trying to.
There is a lot of unrestrained experimentation happening in the crypto space, and failures are to be expected. Over time the harsh winds of the real world, should leave the crypto space with strong players. Already, blockchains such a Bitcoin are the most secure and reliable financial systems in the world. Other cypto players like the exchanges seem to have overcome their initial security problems, despite becoming tier 1 targets on the internet.
In the most recent crypto turbulence, weak players failed and the strong players carried on without missing a beat. The overall stability may look "pretty fragile" when one focuses on recent failures, but may look more robust when compared to the periodic bailouts necessary to keep the traditional financial system running.
Persuasive insights. However, the final analysis, as summarized here, lacks rigor. The fundamental distinction between Bitcoin and all other cryptocurrencies is not made. Therefore, the generalizations are mushy. Smarter to jettison all crypto and speak to the manifest fragility/resilience of Bitcoin only.
There is Bitcoin & Crypto. Think of them as totally separate.
If you are writing about crypto - skip the "is it money" part. 99% of "crypto" is scammy vaporware. A ton of unregistered securities being foisted on naive consumers in thinly veiled pump and dump schemes. When a bubble bursts, the scams get slaughtered. Healthy and good. As opposed to so many zombie companies that are only alive because they can keep rolling over debt in traditional financial markets. Until you see a wave of failures in traditional markets, we are still kicking the can down the road and making the problem worse.
For bitcoin, leveraged bets are being flushed out of the market and there was contagion with this adjacent spaces getting exposed and wiped out. When you want quick settlement - bitcoin is the best game in town. My visa transactions have final settlement 45 days later when i pay that bill. When i purchase or sell securities, its a 3 day wait. Bitcoin has final settlement in 1 hour. Along with final and quick settlement, this asset has all of the attributes to support growing purchasing power over long periods of time.
1. Only monetary asset in history with a fixed supply.
2. Most secure money in history with near zero storage/custody costs over decades.
3. Most portable store of value in history.
4. Most divisible monetary asset in history with each bitcoin divisible by 100,000,000.
5. Recognizability still growing with network breadth & depth.
Like Arnold says, with money transfer services, these days, one is either adjacent to government or adjacent to crime, pick your poison.
The best argument for crypto upside is that it's needed for people committing actual crimes and people committing bullshit ideological """crimes""", and these we will always have with us, especially since they keep inventing new additions to the latter category.
Bitcoin and other similar coins are traceable, unless you use easily available tools and techniques to make it extremely costly to trace. The criminals have already moved to Monero and other much more inherently secure and anonymizing coins, and exactly in line with my claim, this security difference and the demand for greater coin security has helped prop up and sustain the value of the monero-class coins at the expense of the bitcoin-class coins. Just like there's a liquidity premium, there's a "usefulness in getting away with committing crimes premium" and that will keep that sector of crypto humming along.
"Your paper dollars say “legal tender for all debts, public and private.” If you owe somebody $20 and you “tender” a $20 bill, technically the debt is paid, whether the person accepts the $20 or not."
Aggravatingly this law is not recognized by the PA DMV. In many locations they refuse to accept cash as payment, presumably because their staff keeps stealing it. How this continues, and how one would get the law enforced, elude me.
Since it is a government agency, you could probably sue for an injunction to require them to accept the cash. But you would not get your attorney’s fees back, or even your court filing fee, so ... you’d better owe them a lot.
No, you can't sue and get an injunction for cash payment. People have already tried, they failed.
This has actually come up in a number of cases, and the holding is almost always to ignore the physical object implication of the "this note" language printed on bills, and instead to say that government agencies must accept "money" for debts or fees denominated in, well, money, but that they do not have to accept it in the form of cash and physical notes. States are allowed to compel businesses to accept the physical notes.
It is supposed to be sufficient that there exist easy and affordable ways to convert physical cash into value stored in money payment mechanisms the government will accept. A lingering problem is the sui generis case of cannabis dispensaries which (1) deal with a lot of cash, (2) are legal under state law and while illegal, tolerated and not prosecuted by federal policy, and (3) can't get most bank-like services (a worsening problem, but common carrier rules are uncool, I'm told). The dispensaries are told to pay taxes in money, but they aren't allowed to convert their cash into money. Well, they tend to find a way (cough, lawyers, cough). Better call Saul!
Hah, indeed!
How the courts can worm their brains through the logic of "this note" not meaning "this note, right here, that these words are written on" is beyond me. There is just so much wrong with that. Either remove the legal tender rule, or apply it. Damn guys.
Also agreed on the common carrier bank rules. If the Fed gets to decree who is allowed to be a bank and who isn't, those allowed to be banks really should be common carriers. It isn't as though the Fed is just giving away banking licenses to anyone who asks for one, so in effect it is sharply limiting competition while allowing those benefitting to skate around serving everyone and not worry that they are losing market share to competitors. I know the DEA and all them are on that crap too, but the whole thing is a mess. Common carrier style requirements for all regulated closed order industries (where you need a license to be one) seems like good policy.
There is a lot of libertarian opposition to common carrier requirements, but I think most of that only makes sense if one is seriously underestimating the uniformity and degree to which the companies in these sectors are government-obedient. Most charitably it's just a huge empirical error regarding the value of a particular political factor. But if one makes that error, one is letting oneself be fooled into thinking that the border between private and public is clear and solid instead of fuzzy and porous, which creates a convenient route for the state to circumvent constraints and launder otherwise improper state action through complaisant companies eager to please and dependent on its favor. This is now the go-to successful strategy for the expansion of state power beyond what few walls we have left.
If you don't make that error, you will see that what seem like restrictions on """private""" companies are in reality the same restrictions on the state and intended to deter the state from pursuing this strategy, just at the point where the state has extended the tips of its foul tendrils inside these puppets.
I very much agree. I think a lot of people, even libertarians, have underestimated how much the state has gotten its fingers into the market lately. The number of jobs and businesses requiring licenses way up over the past decade, and the amount of regulation used to control business behavior has increased almost as fast as the government's willingness to leverage it. Many industries are essentially state controlled, not in the literal "the state owns the companies" sense, but in the sense that the state controls entry, that is, who gets to be in the industry.
So far as I am concerned, first best solution is to drastically slash and burn that control, back to where anyone can start any business and the state cannot lean on mafia style, "Nice place you got here... be a shame if the EPA were to shut it down" regulatory extortion. Second best would be to say that if you are in a, say, "non-shall-issue license industry", you have to be a common carrier. If the state (or other group wielding state power to keep you out of business) is limiting competition entry to your industry, you have to be a common carrier (or just be liable for your content, perhaps.)
I do feel a little sympathy for banks regarding things like "Know your customer" style regulation, and that sort of stuff should really go. If we can't get rid of that, well, Citigroup just isn't trying to.
There is a lot of unrestrained experimentation happening in the crypto space, and failures are to be expected. Over time the harsh winds of the real world, should leave the crypto space with strong players. Already, blockchains such a Bitcoin are the most secure and reliable financial systems in the world. Other cypto players like the exchanges seem to have overcome their initial security problems, despite becoming tier 1 targets on the internet.
In the most recent crypto turbulence, weak players failed and the strong players carried on without missing a beat. The overall stability may look "pretty fragile" when one focuses on recent failures, but may look more robust when compared to the periodic bailouts necessary to keep the traditional financial system running.
Persuasive insights. However, the final analysis, as summarized here, lacks rigor. The fundamental distinction between Bitcoin and all other cryptocurrencies is not made. Therefore, the generalizations are mushy. Smarter to jettison all crypto and speak to the manifest fragility/resilience of Bitcoin only.
There is Bitcoin & Crypto. Think of them as totally separate.
If you are writing about crypto - skip the "is it money" part. 99% of "crypto" is scammy vaporware. A ton of unregistered securities being foisted on naive consumers in thinly veiled pump and dump schemes. When a bubble bursts, the scams get slaughtered. Healthy and good. As opposed to so many zombie companies that are only alive because they can keep rolling over debt in traditional financial markets. Until you see a wave of failures in traditional markets, we are still kicking the can down the road and making the problem worse.
For bitcoin, leveraged bets are being flushed out of the market and there was contagion with this adjacent spaces getting exposed and wiped out. When you want quick settlement - bitcoin is the best game in town. My visa transactions have final settlement 45 days later when i pay that bill. When i purchase or sell securities, its a 3 day wait. Bitcoin has final settlement in 1 hour. Along with final and quick settlement, this asset has all of the attributes to support growing purchasing power over long periods of time.
1. Only monetary asset in history with a fixed supply.
2. Most secure money in history with near zero storage/custody costs over decades.
3. Most portable store of value in history.
4. Most divisible monetary asset in history with each bitcoin divisible by 100,000,000.
5. Recognizability still growing with network breadth & depth.
Hodl.
Like Arnold says, with money transfer services, these days, one is either adjacent to government or adjacent to crime, pick your poison.
The best argument for crypto upside is that it's needed for people committing actual crimes and people committing bullshit ideological """crimes""", and these we will always have with us, especially since they keep inventing new additions to the latter category.
Bitcoin and other similar coins are traceable, unless you use easily available tools and techniques to make it extremely costly to trace. The criminals have already moved to Monero and other much more inherently secure and anonymizing coins, and exactly in line with my claim, this security difference and the demand for greater coin security has helped prop up and sustain the value of the monero-class coins at the expense of the bitcoin-class coins. Just like there's a liquidity premium, there's a "usefulness in getting away with committing crimes premium" and that will keep that sector of crypto humming along.