United Air: Public relations nightmare

Check out the last minute of this Jimmy Kimmel video. It is a spoofed TV commercial for United Airlines. Based on recent events, it seems pretty authentic. Kimmel’s monologue is pretty funny too!

I have heard from a few people who defend United—offering an explanation of overbooking policy—or the rude defiance of the Asian doctor that was dragged out of the plane bloodied and on his back (and apparently, with a broken jaw). But, no matter how you spin this, United was incredibly foolish to issue a patently offensive statement about how clients were unfortunately “reaccommodated”.
Yeah! I’ll agree that it was certainly unfortunate. But, I am not too sure about this being an example of airline accommodation. Check out the Twitter reaction.
Typically, these things blow over and the public searches for the next low fare—even if it is lower by only one dollar. But this time, I think that United may feel the pain. Their methods and the ensuing arrogance of CEO, Oscar Munoz, are tantamount to flipping a middle finger at paying passengers.
Good luck with that, United Airlines!

Blockchain can dramatically reduce pollution, traffic jams

The World Economic Forum has posted an article that hints at something that I have also suggested. (I am not taking credit. Others have suggested the idea too…But advancing tech and credible, continued visibility helps the idea to be taken seriously!)

I am not referring to purchasing and retiring carbon credits. I like that idea too. But here is an idea that can enable fleets of autonomous, shared, electric vehicles. Benefits to individuals and to society are numerous. And the blockchain makes it possible early in the next decade. It is not science fiction.

The future is just around the corner. Non-coin applications of the blockchain will support great things. Goodbye car ownership. Hello clean air! The future of personal transportation is closer than you think.

Read about it at the World Economic Forum.


Ellery Davies co-chairs Crypsa & Bitcoin Event, columnist & board member at Lifeboat, editor
at WildDuck and will deliver the keynote address at Digital Currency Summit in Johannesburg.

 

Friends at odds with ideology?

At Quora, I play, “Ask the expert”. Hundreds of my Quora answers are linked at top-right on this page. Today, I was asked “Would you stop being friends with someone—if you discovered that they are against gay marriage?”. This is my answer…


Would I stop being friends? Of course not. But I must qualify this answer…

If their position on abortion or marriage is driven by blind, rabid, religious ideology, then I probably wouldn’t have considered them a friend in the first place. In my circles, one’s personal faith should be a guide for moral behavior in a pluralist world. It should never be a substitute for science, common sense, or tolerance. So, for the purpose of this question, I will assume that they are not a right-wing religious conservative.

So, would I stop being friends? Not at all; as long as I can relate to them—intellectually or emotionally. Perhaps not on this matter, but at least on other issues that matter to both of us. My friends have a diverse matrix of opinions, and these often don’t coincide with my own.

Let me offer an example:

I live in America. I am Never Trumper. That is, I believe that our new president has a mental illness and that his election to high office has the potential for disaster (or at least significant ridicule and ‘missed opportunity’ among nations).  Among my extended circle of several hundred medium-close business and personal contacts, I know of only two individuals who supported Trump in the election. And now, 2 months into his presidency, they still support his policies and even his unstable, irrational temperament.

Do I still like these individuals; talk with them; and friend them on social media? Of course! A friend is a friend until they betray you—or until your perspectives are so far apart that you cannot reasonably communicate nor even relate to each other on all the other matters that count.

As I observe one of these two friends continue to support our president in light of behavior that I cannot accept, I begin to realize that he and I interpret events quite differently. We certainly don’t see eye-to-eye on a leader who—for me—is so clearly sophomoric, aberrant and dangerous. Sometimes, I wonder if I can call him a “friend”. But then I reflect on the tangential facts. They matter:

  • I think about all the reasons that we became friends, and the things that he has done for me
  • I think about his qualities, his family, and his work ethic
  • I think about all the people who view the world as he does

After all, Trump won the election and at least 40% of the popular vote. Since less than 1% of my friends voted for him, I may be in the majority—but I have probably lived in a bubble regarding domestic politics. My understanding and appreciation for the political landscape has been challenged.

Here is a second scenario (much more brief): I attended university in a state where smoking and drinking were legal, even for students. Yet, in college, I never used cigarettes or marijuana, and I had not yet started to drink wine or beer. I associated these activities with a derelict upbringing—and so I refused to room with, study with or become friends anyone who drank or smoked. I even refused to socialize with acquaintances who had a friend who drank or smoked.

In those days, I was referred to as being “square”—a term that means rigid, authoritarian, unbending and unrealistic. As you can imagine, I did not have many friends, until I lightened up a bit!

In summary, the question begs anyone who has firmly held beliefs to ask themselves if their beliefs should dictate their associations. Friendships are built on trust and shared experience—not just ideology or even important issues of the moment. In businesses, alliances are built on a common interest. But in life, friendships have more to do with nurturing, respect, selflessness and other personal qualities. Opinions on specific issues matter, but they are far down on the list of human qualities.


I originally ended my answer here. But, in consideration of all the above, I must point out that the ideology-friendship debate has limits. For example, I could not remain friends with someone who believed that the world was created in the past 6,000 years, that LGBT should be marched into concentration camps, that global warming is a hoax, that we must live under Sharia Law, or that woman should not be accorded personal freedoms and basic human rights. (I am not referring to abortion—that’s a bit more complex. I refer to FGM, the right to an education, to drive a car, or to not be covered in a burka). These are all issues of profound ignorance or intolerance. They represent two special classes of hate.

I didn’t mention my abhorrence and intolerance for these things, because of the way in which the original question is structured. It is highly unlikely that I am already friends with anyone so ignorant or intolerant.

Bitcoin ETF Buzz Offers Short Term Opportunity

If you follow Bitcoin at all, then you know that its value is spiking. It has already surpassed a massive spike on Thanksgiving night 2013, and this weekend, a single Bitcoin surpassed the cost of an ounce of gold.                             [continue below image]

Like any commodity, the exchange value of Bitcoin is driven by supply and demand. But, unlike most commodities, including the US Dollar, the Euro or even gold, the eventual supply is capped. It is a mathematical certainty. Yet, demand is affected by many factors: Adoption as a payment instrument, early signs that it is being considered as a reserve currency, fascination by Geeks and early adopters and its use as a preferred tool by some criminals.

But chief among reasons for acquiring Bitcoin is speculation. Whether it is buy-and-hold or day trading, speculators still outnumber those who use Bitcoin to settle debts or to buy and sell other products and services. (Earlier this week, I argued that speculation is responsible for 85% of demand and of transactions—but that’s another story).

It’s a bit ironic that speculation—in the early days of a new market—retards organic adoption. It contributes to uncertainty and volatility, and it reduces the fraction available to the markets that make it both useful and liquid. Yet, in free markets, speculation is a necessary and critical antecedent to adoption.

This week, short term speculators have an unusually keen opportunity to profit, especially if they know how to buy a ‘put’ or sell a ‘call’ (i.e. to leverage a bet for or against the direction of Bitcoin, without actually acquiring any). For example, you can bet that an exchange-traded stock will fall, because it has an options market. But it’s not as easy to bet against commodities that lack a futures or options market.

I am not going to give advice in this article. I am not a licensed investment professional and although I am bullish on long term, organic adoption of Bitcoin, I really don’t have an opinion on the current news or the short term prospects for a pull back. But, if you have an opinion on a current news event, then there is an immediate opportunity for you to make (or lose) a significantly leveraged sum in the next few days…

SEC and ETFs  (Alphabet soup of investment banks)

Next weekend, on Saturday March 11, the United States Securities and Exchange Commission (SEC) will approve or deny an application for the first regulated, recognized and significantly backed Bitcoin Exchange Traded Fund (ETF). Why is this significant? Because most investments are not hand picked by individual investors. Most investors choose the level of risk or diversification that seems reasonable for their life stage and then they leave the decisions to a formula, a market sector basket, or a fund manager. That is, they invest or park their money in a fund rather than betting on Space-X, PayPal or the local electric company.                             [continue below image]

If approved, an ETF potentially adds massive new demand for a commodity, by offering a financial instrument than can be subscribed by the vast fraction of funds, investors, pensioners and speculators who prefer to leave asset management to an organization, outside broker or formula.

The first ETF application is created and backed by the Winkelvoss twins. They were Olympic rowers, but found fame & fortune by contracting Marc Zuckerberg to create an early platform for Facebook. If their application is approved, a dozen more investment banks, brokers and hedge funds are standing by to jump in with both feet.

This morning, Cointelegraph put the odds that the ETF will be approved at 50%. Some analysts place the chances even higher. But consider that Bitcoin has already spiked dramatically in the past few weeks. The excitement is already reflected in the price. So, where is the opportunity?

The opportunity, as with any speculative decision, is in the dissonance between your research and hunch compared with the overall market expectation reflected in the current price. So, for example, if Bitcoin is accepted as the basis for an ETF (and if it continues to grow in more fundamental adoption), the current price is actually remarkably low. Under these assumptions, it hasn’t even begun its period of rapid ascent. Perhaps more obviously (and even more short-term), if you believe that an ETF will be blocked by regulators, then the recent rise is likely to be reversed quickly, at least in the minutes after the March 11 decision is announced.

So how can you profit from your belief that a commodity will drop in value? I leave that to your personal investment knowledge and research or your financial advisor. My purpose is not to advise, nor even to teach about puts and calls. It is to point out that a few people will win or lose a lot of real money this coming weekend—at least on paper. And it all hinges on whether they can correctly predict the outcome of a regulatory decision process.

Again, Bitcoin is a very limited commodity, There are only 15.2 million coins today, and there will never be more than 21 million coins. This does not present an obstacle to adoption, because the coins can be sliced smaller and smaller as needed. In a noteworthy demonstration of ‘good deflation’, there will always be enough units for everyone—even if the entire world adopts it for every transaction under the sun.


Ellery Davies co-chairs Crypsa & The Bitcoin Event. He is a columnist & board member at Lifeboat Foundation,
editor at WildDuck and is delivering the keynote address at the 2017 Digital Currency Summit in Johannesburg.

What Fraction of Bitcoin Value is Driven by Speculators?

At Quora, I occasionally play, “Ask the expert”. Several hundred of my Quora answers are linked at top right on this page. Today, I was asked “How much of Bitcoin’s value is driven by speculation”. This is my answer…


This is a great question! While the value of any commodity is determined by supply and demand, speculation is one component of demand. Another is the unique utility value inherent in a product or process. This is sometimes called ‘intrinsic value’.

It’s ironic that when a high fraction of value is driven by speculation, short-term value becomes volatile and long-term value becomes less certain—and less likely to produce returns for those same speculators.

Editor’s Note: In the past few weeks, a significant spike in Bitcoin’s value and trading volume relates to a pending regulatory decision expected at the end of next week. This activity is certainly driven by speculation. But for this article, I am considering periods in which the demands of individual events are less clear.

The value of Bitcoin is influenced by:

  • Day traders who buy and churn
  • Long-term speculators who buy and hold. This includes me.
  • Criminals who hope that cryptocurrency transactions can be more easily hidden than government backed currencies
  • Early adopters who use Bitcoin as a payment instrument or to send money
  • Vendors who accept the coin in exchange for products and services
  • Vendors who retain a fraction of revenue in Bitcoin (rather than exchanging to Fiat). To avoid a round trip, they seek to purchase materials, pay staff or settle debts with the Bitcoin they earned.

Here’s the rub: Bitcoin will not become a store of value unto itself (i.e. a currency), and it will not gain a significant fraction of the payment instrument market until the transaction volume of the first to user categories in the above list are overtaken by the the ones further down. Likewise, Bitcoin will not enter its biggest growth spurt until the last two items swamps the others as the largest motive for acceptance and use.

Put another way: Long term value must ultimately be driven by organic adoption from actual users (people who buy and spend Bitcoin on other things).

In another article, I expand on the sequence of events that must take place before Bitcoin grows into its potential. But make no mistake. These things will happen. In tribute to the brilliance of Satoshi, the dominoes are already falling.

In response to the question, I estimate that at the beginning of 2017, 85% of Bitcoin value is still driven by speculators. I have not analyzed wallet holding periods compared against the addresses of known vendors. Furthermore, it would be difficult to understand the relationship between the number of speculative transactions and the overall effect on value. Therefore, my figure is more of a WAG than an calculated estimate. But it’s an educated WAG.

The fraction of speculative transactions will drop significantly in the coming months—even as late speculators jump on board. That’s because uptake from consumers and businesses is already taking off. The series of reactions that lead toward ubiquitous, utilitarian applications has begun. Bitcoin’s value will ultimately be driven by use as a payment instrument and in commerce.

Because it is a pure supply-demand instrument, Bitcoin will eventually be recognized as currency itself. That is, it needn’t be backed by precious metal, pegged convertibility or a redemption promise. When that happens, you will no longer ask about Bitcoin’s value. That would be a circular question, since its value will be intrinsic. Instead, you will wonder about the value of the US dollar, the Euro and the Yen.

As a growing fraction of groceries, gasoline and computers that you buy are quoted in BTC, you will begin to think of it as a rock, rather than a moving target. One day in the future, there will be a sudden spike or drop in the exchange rate with your national currency. At that time, you won’t ask “What happened to Bitcoin today? Why did it rise in value by 5% this morning?” Instead, you will wonder “What happened to the US dollar today? Why did it drop in value by 5%?

VILE: USA treatment of tourists under Trump

 

I wrote this during Trump’s first address to a joint session of Congress (Day 40 as president). Pundits
praised his conciliation and delivery. Trump stayed on-point and appeared more “presidential” than in past.
This post is about action; not talk or appearance. It is testimony of his leadership earlier on the same day.

This weekend, Mem Fox—a well-known Australian children’s author—was pulled aside at the airport upon arrival. She describes a horrifying and undignified experience. One that made her abhor our country. Others in the room were treated even worse. Those who were not white, English-speaking and upper-middle-class were yelled at and mercilessly humiliated. No toilet or water was offered to arriving passengers—even a young woman with a baby.

You might wonder what was the reason for suspicion? She certainly doesn’t fit the profile of  a terrorist. Many American children grew up with her books. This was her 117th visit. She is white, wealthy, educated and articulate. (None of these traits are required to visit the United States). She was pulled aside and interrogated because her airline ticket appeared to be paid by her American publisher. The immigration official claimed that she was attempting to sneak in—and work in America, illegally.

Ms. Fox isn’t the only tourist to come forward today. The French Holocaust historian, Henry Rousso, was held for 10 hours at immigration. Was his entry suspicious? He has taught at Columbia University in New York and Sorbonne in Paris. He was visiting America to give a Keynote Address at Texas A&M. But just as with Mem Fox, the immigration agent learned that he was receiving a fee for his speech. He was told that he would handcuffed and deported on the next plain to Paris. If not for a sharp lawyer at the University, he would have would have been shipped away in humiliation and disgrace. Rousso sums up the experience with this observation: “The US is no longer quite the US.

Their experiences make a mockery of the Emma Lazarus’ words at the base of Miss Liberty: “Give me your tired, your poor, your huddled masses yearning to breathe free.” Apparently, under a Trump regime, even the upper class, the academics, and the distinguished don’t make the cut.

Is this the friendly and welcoming face that we wish to show our foreign visitors and academics? Do you think that they will travel to the United States or do business with us, if clueless border control agents behave in this manner?

What Chutzpah, Xenophobia, and misguided attempts at protectionism! Unfortunately interacting with minor officials under Trump seems a lot like the interaction between German citizens and Jack boots of the Nazi SS or Gestapo.

For many individuals like Fox and Rousso, it’s not just about fake news, narcissism, a string of lies, fearing the press, lashing out at critics, lining pockets at taxpayer expense, surrounding oneself with racists or buffoonery. Instead, it’s personal; it’s ugly; it reflects on all Americans; and it is reprehensible.

It doesn’t require a bipartisan gaggle of psychiatrists to recognize that our president is seriously deranged. That diagnosis is just plain common sense. Additionally, it doesn’t require a political analyst to observe Republican congressional leaders squirming in their chairs or struggling to show unity on the evening news. At least not if you avoid the ‘fake news’.

Now, we must summon the strength and the resolve to do something. Trump must not complete his first year in office. Even if his paranoia, vindictive ethos and contempt for the truth abates, think of the missed opportunities, the mass exodus of talent, the likelihood of a military orgy. Think of the lost business deals, the serious environmental damage and the fostering of hate between cultures. Think of a woman’s right to choose and the hard won LGBT right to marry and to be who they are.

Think about Mem Fox and Henry Rousso. I wish that I could get over the slimy behavior from his campaign trail, but here one last jab… Think about a leader who brags about his p*nis size and about grabbing woman by the p*ssy. Think like an individual who cares about the future of our nation, our alliances and our planet. Raise your voice. Join your neighbors. Seize the day. Do something!

In years of writing, I never thought that I would end an op-ed piece like this:

  • Resist
  • Defend
  • Restore our lost ethics and compassion
  • Embrace diversity—It is a core strength
  • Speak out for the environment
  • Deal honestly and fairly with other countries; lest they flee a relationship
  • The truth matters

MIT: 3 Big Blockchain Initiatives

MIT has never stood stand still in the presence of change and opportunity. Their Media Lab Currency Initiative is at the forefront of Blockchain and Bitcoin research. With the fracture of the founding core team, MIT stands to become the universal hub for research and development.

The initiative has a team of 22 people and—currently—seven research projects. It nurtures three startups that use cryptocurrency and blockchain in a variety of novel ways. Blockchain research now sits alongside transparent robots that eat real-world fish, solar nebula research, and other imaginative, futuristic projects in progress at the university.

The initiative has already funded the work of bitcoin protocol developers and has supported research, going far beyond bitcoin—even partnering with Ripple Labs and developing enterprise data projects.

Now, the MIT Media Lab Digital Currency Initiative is working on 3 big Blockchain ideas:

  1. Shattering online ‘echo chambers’
  2. Improving blockchain privacy
  3. Building central bank currencies

The DCI is led by former White House advisor and research director Neha Narula. Read about the three BIG blockchain projects at CoinDesk

Ellery Davies co-chairs Crypsa and The Bitcoin Event. He is columnist & board member at Lifeboat Foundation,
editor of AWildDuck and will deliver the keynote address at the 2017 Digital Currency Summit in Johannesburg.