jpkoning's comments

The Fed still does purchases and sales, but not for the purpose of driving the overnight interest rates towards its target. The level of the overnight rate is not affected of any purchases or sales that the Fed does.

"What happens next is that they buy and sell government bonds in the open market."

This describes how central banks operated in the U.S. before 2008 and in Canada before the 1990s. The Federal Reserve and the Bank of Canada both set a target for the overnight interest rate, and then they hit that target by doing open market purchases (or sales) of bonds, effectively adding funds to (or draining funds away from) the overnight lending market. By changing the quantity of funds, they influenced the interest rate.

What changed is that both central banks introduced interest payments on balances that banks hold at the central bank. Previously, these balances earned 0%. With this new tool, they could directly set the overnight interest rate by adjusting the rate paid on these reserves, eliminating the need for regular open market operations.

The Grit Daily article cited in the linked-to tweet is fake news. It alleges that PayPal's proposed misinformation clause and associated $2500 penalty, which was cancelled by PayPal earlier this month, has been quietly "added back into the terms of service with equally ambiguous language."

This can be proven wrong with a quick check of PayPal's acceptable use policy in the WayBack Machine. The $2500 fine that the article alleges has been added back after "criticism on social media died down" has been there since 2021. [https://web.archive.org/web/20211013092233/https://www.paypa...]

As for article's allegation that a prohibition on intolerance has just been added this October, that clause been there since 2018. [https://web.archive.org/web/20181108164503/https://www.paypa...].

So there is no justification to the article's allegation that the clauses have been quietly added back to PayPal acceptable use policy.

Furthermore, in building its argument that the misinformation clause was sneakily "added back into the terms of service," the article erroneously makes the assumption that a prohibition on intolerance equates to a prohibition on misinformation. This doesn't follow.

I'm not trying to support PayPal's acceptable use policy. But if you're going to attack it, at least use facts.

Environmental, Social, and Corporate Governance.

That's right. In the US's case, if it was protecting a weakened friendly country or trying to rebuild a not-so-friendly one, dollarizing the economy would have undermined the occupied government and interfered with the US's overall goals. Using cancellable paper certificates like MPC or a closed loop electronic system like EagleCash prevented leakage of US dollars into the local economy.

The US military has had some innovative payments ideas.

An occupying force prefers to use a money that 1) doesn't dollarize the nation they are occupying 2) can be tracked, thus thwarting black marketeers 3) is lightweight 4) if they lose, the enemy can't reuse it

Unfortunately, dollar bills are bulky, infiltrate local economies, and aren't enemy-resistant.

So we get innovations like EagleCash, which solves a lot of these problems.

Other payments ideas emanating from the military include Military Payment Certificates (https://jpkoning.blogspot.com/2017/04/c-day-and-military-mon...), overstamped currency ( https://twitter.com/jp_koning/status/1343874636480729088) and pogs (http://numispedia.org/AAFES/).

Just because many bills don't pass doesn't mean that bills in progress shouldn't be discussed on forums such as this one.

This is why it's a good idea to put boring things like birds or bridges on currency.

They're still usually asking for bitcoin.

A few months back REvil/Sodinokibi switched to Monero, but I think they're the only strain to do so.

Well said.

Most regular folks don't think like to think about banking, just like how they don't like to think about how their car engine works.

But if you ask them to describe how banking works, they'll inevitably resort to the some version of the "giant vault" analogy. Of course, that's the wrong way to think about banking. Which the article rightly attempts to dispel.

Go for it, America. We got rid of the penny up here in Canada in 2012. Doing so removed a degree of hassle from everyone's commercial lives.

Yes, the penny should be gone.

But I disagree about the $1 note. According to the GAO, replacing the $1 note with a $1 coin would actually result in a net loss to the government:

https://www.gao.gov/assets/700/697778.pdf

>Even just adding a 4 hour "activation time" on cards worth more than $250 would make the scam just a little harder to pull off

That's a good idea.

Implicit in this idea is that victims can call a customer help number and get gift card balances frozen and reversed. I don't know if this is possible to do right now.

If so, fraudsters might start up a new scam. Buy $1000 in Target gift cards, spend the money at Target, call up Target and claim that a scammer stole the funds, and then get $1000 back, netting $2000.

Target would have to build a new department just to adjudicate gift card claims. At which point it might decide that it's just not worth the hassle of issuing gift cards.

>I think that they are making the point that they actually are free of charge.

That's right.

An "on-us" transaction, one that simply requires RBC to update its database by debiting funds from RBC customer A and crediting them to RBC customer B, is free. (If your bank is charging you for that, switch banks!).

A wire transfer is more complex than an "on-us" transfer because it involves two bank database. RBC has to debit its database, and Bank of Montreal has to credit its database, and the central bank is usually involved as an intermediary. This often involves a wire transfer fee.

If we both join the bitcoin network, we can exchange $1B for $0.48.

If we both join set up accounts at a regular bank like RBC, we can exchange $1B for free.

The point I'm making is that fees are not bitcoin's strong point. Any financial network can undercut it. What is unique about bitcoin is that not everyone can get an account at RBC, but anyone can join the more expensive bitcoin network.

Yes, a debit card is a bank transfer.

In the US, most PIN debit card transfers occur via either MasterCard's Maestro or Visa's Interlink debit networks. Signature debit payments go through MasterCard/Visa's credit card networks. So you've still got the duopoly problem.

This is good news on the competition front.

The traditional problem with bank-to-bank transfers in a retail, or point-of-sale, setting has been speed. Cheque was about the fastest that could be mustered.

But with developments like UK Faster Payments (which is mentioned in your link) bank-to-bank transfers are getting faster, in some cases instant. And so usability at the point-of-sale is now on par with cards.

In Holland, iDEAL is used a lot for retail purchases. It's an instant bank-to-bank payment option that competes with the card networks.

The equivalent in Sweden is Swish. It too is moving into point-of-sale payments.

As for the US, I suspect that at some point Zelle will pivot into retail point-of-sale payments. At which point the card networks will have a big competitor.

All of this is good news if you are worried about the card oligopolies!

Yes, it is. My understanding is that some people use bitcoin as a bridge for remitting funds into Venezuela.

But this is a niche usage. What locals really want are dollars. Something like 50-60% of all Venezuelan transactions are now being conducted with U.S. paper money and Zelle.

You'd think that Venezuela would have provided incredibly fertile ground for bitcoin usage to go mainstream.

But what actually happened is good old fashioned dollarization. U.S. dollar banknotes flooded into the country. As for digital payments, Venezuelans have repurposed Zelle, the U.S-based person-to-person payments option, to make digital U.S. dollar payments.

As the article points out, Sci-Hub relies on bitcoin for international donations but the majority of its donations come via Yandex.Money, a Russian version of PayPal. I guess that means that most of its donations come from Russians and other CIS nationals with access to Yandex.Money.