>> ^Jinx:

I'm just really bored at the stagnate FPS genre atm. Hasn't been a good recent multiplayer FPS game recently apart from TF2, and that was a while back. Even then the focus is clearly on public play and the competitive community is small and dying out pretty quickly. Its sad that in this e-sports renaissance created by SC2 there is no FPS game to really step up and enter the limelight. The Arena style of Quake needs to make a comeback. Its so watchable as a spectator sport, and the skill the best players display is just astounding. Even watching these speedruns etc makes my jaw drop.
Instead we get boring Modern Yawnfair 12 - For Xbox360 and PS3! And yah, I'm a PC elitist. I watched some Halo3/Reach @ MLG and while it wasn't terrible, it was lightyears behind Quake. CS:GO is on the horizon, and I hope steam support that as much as they are pouring money into DotA2, but still, I prefer an FPS where you don't die in one pixelshot or from wallbanging spam.
/rant
Oh, and a new tribes is coming, but I was super turned off by their free2play model. If its anything like LoL I am not interested. I'd rather pay upfront and know I am on a equal footing than everybody else rather than sink limitless cash into making sure I can remain competitive.


I realize I'm necroing a 2 week old video thread, but, there are some things that nobody bothered to say.

Jinx: Many of these F2P games are not Pay2Win. You simply pay for variety/speed of unlocks. Nothing you can pay for with cash can make you do more damage, move faster, etc. The only things in LoL that absolutely require actual cash are character skins and extra rune pages. Everything else can be unlocked with the same points even the richest person has to earn by playing matches. Can you spend $1-200 and unlock every character? Yes. Do you have to...is it worth it? No. Just play with the free rotated characters each week. Personally, I'm sick of paying up front for shitty games or games I don't play that often.


@EvilDeathBee The difference is, many of the companies that used to produce the best stuff now produce mass market crap and many of the great companies were bought out and/or ruined by EA/Activision. Westwood Studios...gone. Lucasarts is plagued by the same mass market bullshit problems as the newer movie trilogy. id hasn't made a good shooter since before Doom 3, and Rage is the latest crap they've spewed out. You can find videos of Carmack saying they're being held back by console graphics/memory considerations. Luckily we have Blizzard and Valve still, though Blizzard is now Activision Blizzard, and is making console Diablo 3 and has added friggin Facebook to Battle net. GG. Valve seems to want to make hats, ignore HL2:Ep3 while splitting the already-split MOBA community by releasing DOTA2, which nobody really asked for given that HoN and LoL are rather popular. But, at least Valve and Blizz put out quality PC games. BF3 now has the useless Origin, which is nothing but a business move and provides zero benefit to gamers.

Games used to be art. Now they're all about money.

@Hawkinson "A few thousand"? Doom 2 sold like 2 million back before PC gaming was at all popular. Quake 2 sold 1-1.5 million also. I couldn't find Q1 numbers but I'd guess they're similar. You're also forgetting that Doom 2 was distributed as shareware, and I've seen estimates that 15 million played it. Give google a try next time you want to pull statistics out of your ass

@NetRunner

I never said banks create money from nothing. They are allowed to grant someone money based on their promise to pay it back.

You're making it sound like I'm saying banks can just literally add money to their balance sheets. That is not what I'm saying.

I never said interest collected reduces the money supply. Collecting principle does. When you finish paying back a debt, the bank zeroes out the debt associated with that loan, which removes the money from the system. The interest is left over and that is what increases the money supply.

Banks bother with loans because the promise someone makes when they sign on the dotted line is the only thing of actual value in the entire system: The lender's trust and the borrower's promise. You must have that promise in order to create the money. You don't just add numbers to your balance sheet because you feel like it unless you're trying to commit fraud.

There's a difference between central bank money and commercial bank money. It's the fact that money lent out by one bank can be deposited at another bank, and that bank can make loans based on that deposit, which has not been repaid to the original bank yet. It's called re-lending. So, while each bank is not literally creating money on their balance sheets, the total aggregate interest repaid to the system is constantly increasing the money supply because that interest never existed when the process began.

I haven't been explaining it very well. Look, it's not the individual bank that's creating the $900 from $100 in deposits, it's the system overall...when you add up all the loans created by the initial $100 in Fed deposits. The ratio of publicly held money vs. Fed deposit reserves is what's important.

http://en.wikipedia.org/wiki/Money_multiplier

specifically:
http://en.wikipedia.org/wiki/File:Fractional_reserve_lending_varyingrates_100base.jpg

The graph shows it well. The $900 number is an approximation of the actual number, which can be obtained from the geometric series.

You can also read this document produced by the Chicago Fed branch:
http://en.wikisource.org/wiki/Modern_Money_Mechanics/Bank_Deposits%E2%80%94How_They_Expand_or_Contract

Specifically, the part where it says "...Of course, they do not really pay out loans from the money they receive as deposits. If they did this, no additional money would be created. What they do when they make loans is to accept promissory notes in exchange for credits to the borrowers' transaction accounts. Loans (assets) and deposits (liabilities) both rise by $9,000..."

@NetRunner

I think the difference in our concept of what's going on is that my understanding is that commercial banks can make a reserve deposit at any Fed branch and then make loans against that. From what I can tell, there isn't any math done like you're describing. Maybe if you want to make a new bank or long ago when some of these banks were created there was math like that, but there isn't anymore. There is simply a minimum number required to have on reserve deposit or in vault cash compared to how much you have loaned out. This is all not to mention that there are types of deposits which have exceptions to the reserve requirement. That alone makes sure banks are loaning more than they have (if they want to take the increased risk).

http://en.wikipedia.org/wiki/Reserve_requirement#United_States

I mean, if putting $100 in a Fed reserve bank and loaning out $900 based on someone's promise to pay isn't creating money, I don't know what is. You don't have to start out with $1000 to make the $900 loan once you're already a commercial bank. That's the point. If you make money on some investment, you can make loans and collect interest against your increased profits. You don't have to have the money and then hold 10% back. (Glass-Steagall, anyone?)

Plus, the money that comes in as interest is money that never existed in the money supply before the loan was created. Someone else has to borrow money to pay you in order for you to be able to pay your interest. This is why growth is required to pay interest and avoid foreclosure and default. If the money supply does not increase and more people aren't promising to pay interest, other people won't be able to fulfill their promises to repay. That's why the system requires growth to function well.

Legal tender law and fiat currency make sure that everyone must participate in the system at some point, or your contracts won't be protected by the courts and you won't be able to pay your taxes, since both only deal in dollars.

@NetRunner

I don't think I'm trying to say my understanding is superior...at least not in terms of how things actually work. I don't work at a bank, and I only learn about monetary systems in my spare time to educate myself, so if I don't understand how something works I'd like to be corrected.

What we're obviously free to differ on is our interpretation of the effects the system has. Reading your posts here and on other video threads as well as seeing your videos leads me to believe there isn't a whole lot of difference.

So, I think when people say "banks create money", they're either ignorant and parroting something someone else said or simplifying the system to save a ton of words. If the bank in your latest example can't satisfy withdrawal demands, it probably borrows money from a commercial bank, which can request money from the Fed to cover the difference. The private bank is still liable for it, of course, but it allows them to pay it back gradually (as originally planned). If the Fed deems it necessary, it creates new money and supports the system with it. So, yes, the bank is not literally creating the money on its own, but it seems to me that banks granting loans for more money than they possess at any given time is the most significant reason for the Fed to have the ability to increase the money supply. So, while they're not literally the ones creating it, the process is the *reason* for its creation. Tough to separate.

So, I'm not saying individual banks are balance sheet wizards, but they are a big reason we have a magical money system. It's that money system that requires constant growth to function well as I talked about earlier.

These two videos are far shorter than the ones I linked earlier (around 8min each)...they show that it's possible to imagine workable systems of credit that aren't reliant on debt and interest the way our current system is. Systems that don't have the fragility of our current one...

http://www.digitalcoin.info/The_Essence_of_Money.html
http://www.digitalcoin.info/Digital_Coin_Introduction.html

@NetRunner

See, that is indeed where our understanding differs. Any bank may create money, not just the Federal Reserve. The Fed is the only agency that can literally create it from nothing. All other banks in the system create demand for it based on the fractional system. They may only loan money based on the reserve ratio.

So, yes, banks want depositors because the amount of loans they can issue (and therefore the amount of incoming interest they can collect, which further becomes more money they can lend) is partly based on deposits. But, as your Wikipedia link points out in #6 of the process, "when a loan is granted, the person is generally granted the money by adding the balance to their bank account." They don't mean "instead of giving them cash or gold". They literally mean "granted the money"...the money is created in their account. Money which did not exist prior to the loan agreement.

So the bank gives you $10,000 while holding $1000 in reserve (10% reserve requirement). The bank also creates a $10,000+interest hole for you to fill and generates a monthly payment bill. At no point did the bank have $10,000 to give to you...as in, if you marked every dollar in the economy with a serial number dependent on who created it, they would all say "i was created by the Fed at the request of bank XYZ to pay out loan money to someone because they don't have it on hand". When you pay back your loan, the bank destroys the "hole" it created for you, but keeps the interest on the bank's balance sheet.

When someone cashes your $10,000 check, the bank then transfers $10,000 to that person's account, but that $10,000 is available partially because of deposits and partially because of incoming interest payments from people with outstanding loans...or other bank profits from investment or whatever. If the bank has $1M on deposit, they can create $10M in loans TODAY, and if each of those people all request cash immediately, the bank will not have it on its balance sheets. But, the Fed is allowed to create cash from nothing to pass on to the bank for the purpose of fulfilling these withdrawal requests. Yes, it does seem incredible. Yes, this is why people don't like fractional reserve banking.

So, even though the Fed is the one supplying the actual cash, it is the banks who are creating the demand for the newly created money. This is how banks loan more than they have...based on how much they have on depost with the local (or central, in the case of commercial banks) Federal Reserve branch.

We're saying a lot of the same things, but there is a difference.

EDIT: this is also the reason I belong to a credit union

>> ^NetRunner:

>> ^mgittle:
The problem with fractional reserve systems using fiat currency is their reliance on growth.
I haven't watched the documentary you linked, but the only part of what you said I'd really contest is this part.
How is fiat currency reliant on growth?
Perhaps you meant it the other way around -- that fiat currency is just one more tool that's used to cajole the human race into participating in this "growth" whose value has become increasingly dubious?
That's how I see it, at least on the days when I see the face and not the vase. Most days I still see markets and capitalism as a positive net influence on the welfare of the human race, but their most fervent advocates sure do work hard at making me think otherwise.


Yeah, well put rearding the "fervent advocates". I did kind of mean it the other way around. Thank you for actually taking a second to understand my meaning rather than arguing literal points only (the literal-only thing being my definition for nerdiness).

It's not fiat currency alone that makes our economy reliant on growth. I should have been more specific, but such is life when you have to get to sleep...haha. Fiat currency just a part of the whole Fractional Reserve banking + legal tender law + fiat currency system. In my mind, the growth thing is probably tied most to the fractional reserve system. Hopefully none of this sounds condescending because I'm not sure how much of this you already know, but here's my understanding:

Because the money supply is variable and dependent on debt, an expanding economy is extremely good and a contracting one is extremely bad. Because banks are allowed to loan more money than they possess *and* charge interest, you run into a problem. Where do individuals get the money needed to pay the interest on their loan if it was created from nothing? You have to get it from the overall money supply, which is made up of money created by banks from other peoples' promises to pay.

Thus, with every new credit card swipe, mortgage signing, etc, more money is owed to banks than actually exists at any given time. It's only the time lag between borrowing and repayment that keeps the entire system from collapsing. This means that unless the total amount of debt continually increases at a sufficient rate, it's impossible for everyone to succeed in paying back their loans...there must be foreclosures. This is why people constantly get offers of new credit, *and* why recessions are such a bitch. It's very hard to get things growing again after the money supply decreases.

The system is also one in which individuals paying off debts have more money (less income goes to paying interest), but everyone paying off their debts leaves society with no money. Therefore, anyone who pays off their debt to increase their own personal financial security actually hurts the overall economy. It makes no sense for markets to rely on rational individuals' decisions if their individual decisions are bad for the economy in aggregate. For this reason alone, the system is extremely fragile.

Hope all that makes some sort of sense. Maybe I'm wrong in parts. I'm partially regurgitating the videos I linked earlier while adding in stuff I've learned from other sources. I've nor heard anyone refute the premise of the video, but I'm sure it's not infallible in its interpretation. I'd love to hear what other people think. It got sifted long ago but there was little discussion.

As for your comments about markets being a net positive, I don't disagree with you at all. It's when people rely on markets to solve every problem (including moral ones) and don't realize that there are some places markets ought not go that there becomes a problem. (Should courts enforce a custody contract between an infertile couple and a surrogate mother? ...and and endless list of other similar questions)

>> ^bcglorf:

>> ^mgittle:
@dannym3141
That's the point of this occupywallst thing. It doesn't require an inspiring figure or a set of demands or goals to achieve. It's like when someone who's always thought there was something wrong with their religious beliefs meets an atheist and has that realization that there are other people out there who are having the same thoughts as they are. It's a pretty powerful thing.
I agree that protests seem more effective when they have specific goals, but why does this specific protest need a goal today . I think it's better to stand up and say the whole "I'm mad as hell and I'm not gonna take it anymore". Work out the details later.
The Arab protest movements didn't start with any inspiring figures or well thought out sets of goals. Sure, they were probably a little more geared towards getting rid of their governments, but those governments had figureheads. Wall Street has no single figurehead at which people can direct their anger. How do you kill a beast with no head?
I think we're seeing something new here...a protest with no head to kill the beast with no head. A true battle of mindsets. This is the new culture war.

The Arab spring had a very clear goal, to remove a dictatorship and replace it with democracy. They weren't just mad at the world and burn it all down. They had a very specific alternative already in mind that they were demanding. You demean their plight and deaths for the right to vote by claiming kinship between it and this vague, I'm mad cause I wanna be rich too rumbling.


Yeah, maybe it's a first world plight and it's not as "fight or flight" "life and death" as the Arab spring, but I don't think it's right to differentiate struggles against the concentration of power the way you're suggesting. That's like how people argue that soldiers with PTSD shouldn't get a purple heart because they didn't shed blood. Yes, it's different, but it's still an injury. You can argue that health care is a life and death struggle as well. Hell, I'd almost rather we were fighting for our lives in the literal sense...then maybe people would realize that dying from lack of health care is still dying. The fact that you didn't get shot or die in a terrorist attack doesn't change that. Dead is dead.

I don't think the wall st. protesters are just "rumbling", nor do I think they want to just "burn it all down". It's also ridiculous to say that they "wanna be rich too".

@dannym3141

Fair enough, but I'd rather (and think it more likely) that there'll be an incident that bands people together than an inspiring figure in this case. The people in this protest seem to be a little too anti-groupthink for that, hence my sentiment indicating my belief that this is different than other movements. We'll see if the numbers increase and/or it dumbs down from that.

Also, you think everyone who deserves to go to jail automatically does? Didn't the OJ trial teach you anything? Money talks...

As for this "thin veneer", that's just culture driving us apart. Humans are social animals...

>> ^Winstonfield_Pennypacker:


It's just a few malcontents who represent no population of any importance.


Ah yes...the tyranny of the majority-minority. They should have the tea party and the occupywallst people battle on pay-per-view for who gets to start the revolution. Now THAT would be real America.

@marbles

I agree with your assessment of fiat currency, I guess I think the problem runs deeper because I'd rather not just gamble and assume technology will save us from ourselves.

There are quite a few problems with going back to a fixed-supply currency. Maybe I'm not studied up on all the current real-world solutions for moving back to the gold standard or whatever other flavor one might advocate, but gold can be debased, bars can be shaved, currency can be hoarded...the list is fairly long.

That's why we need a value-based monetary system rather than a debt-based one.

@dannym3141

That's the point of this occupywallst thing. It doesn't require an inspiring figure or a set of demands or goals to achieve. It's like when someone who's always thought there was something wrong with their religious beliefs meets an atheist and has that realization that there are other people out there who are having the same thoughts as they are. It's a pretty powerful thing.

I agree that protests seem more effective when they have specific goals, but why does this specific protest need a goal *today*. I think it's better to stand up and say the whole "I'm mad as hell and I'm not gonna take it anymore". Work out the details later.

The Arab protest movements didn't start with any inspiring figures or well thought out sets of goals. Sure, they were probably a little more geared towards getting rid of their governments, but those governments had figureheads. Wall Street has no single figurehead at which people can direct their anger. How do you kill a beast with no head?

I think we're seeing something new here...a protest with no head to kill the beast with no head. A true battle of mindsets. This is the new culture war.

@davidraine @NetRunner @marbles

I think these videos explains it better:
http://www.youtube.com/watch?v=Dc3sKwwAaCU
http://www.youtube.com/watch?v=rCu3fpg83TY&feature=related

They're much longer and the animation is terrible, but they have better content, IMO.

As for banking without a fractional reserve system...you could have a system that utilized self-issued credit traded on an exchange. Money and credit could be based on the amount of valuable goods and services you (or a company) can provide rather than based on promises to pay back debt.

Yeah, it's the same guy's video, but you can learn about the idea here:
http://www.digitalcoin.info/

The problem with fractional reserve systems using fiat currency is their reliance on growth. It should be obvious even to children that "growth" cannot be sustained indefinitely in a closed system (the planet Earth). You can argue technology will fix our problems before nature fixes them for us, but that's gambling, IMO.

The biggest problem with growth, IMO, is a moral and philosophical one reflected by its influence on our culture. People talk about growth and progress as being some sort of universally good thing. *cough*AynRandobjectivism*cough* Growth needs to be a means to an end, not an end in itself. The problem with growth and progress being an end in itself is that we cannot have a conversation about what we're growing into or why we're even bothering to grow in the first place.

I'd like to see the data adjusted for:
1. the number of people who read the books (probably impossible)
2. Television
3. Radio
4. Internet (2, 3, 4 adjusted for # of viewers/listeners/page views)

Unless you look at all the data, you're not getting as accurate a picture as you could. AND, you're going to convince yourself of the accuracy of your data "because it's fun" rather than because it's rigorous. I hate when people give talks and ignore these types of things. But, I guess that's what happens when you smash 4 years of research into a 15 minute talk where the speakers are trying to be funny.

Oh Procrustes, you and your bed...crazy times.

TED is like the weekly layman's science magazine. There are some cool ideas to think about, but you'd better be prepared to learn more about it and/or think for yourself, because it seems like the majority of the authors of the talks are just enjoying the attention for their research.

I think the most interesting thing here was Chomsky talking about how humans are absolutely terrible at predicting things before they happen, but have an amazing capacity to construct narratives to explain events after they occur (often with zero evidence).

It just so happens there's an entire book on that called "The Black Swan". I highly recommend it. The author is also coming out with a new book called "Anti-Fragility" and has released several draft chapters on his FB page (I hate FB...his is the only page I go to).
http://www.facebook.com/pages/Nassim-Nicholas-Taleb/13012333374

I think this Taleb guy is one of the most important thinkers around...he's just not as public as Chomsky, Dawkins, etc, nor is he an academic.

@RedSky

It's not that speculative activity has "nothing" to do with supply and demand. Of course it does. I'm saying that once you get past that initial set of contracts between the initial speculator and the farmer/mill/bread company/whatever, you get further and further away from supply and demand as a factor. You get people who are betting on price swings for profit rather than someone actually providing a service. The video did a pretty good job of illustrating the see-saw effect this has on markets, which makes prices unstable.

This see-saw effect causes severe and sudden price spikes and dips as people pile on short sales or speculative buying. The point is, if the price for a good increases 71% in a short period of time without extreme supply issues, it's likely a speculative effect. Yes, the video could have done a better job of explaining why biofuels, certain supply shortages, etc, don't account for nearly all of the price increase, but I've heard that broken down elsewhere. I'll try to find a source.

Furthermore, large US investment banks have convinced sovereign wealth funds (think Saudi royal money type funds) to invest in US commodities markets in recent years.

http://www.washingtonpost.com/wp-dyn/content/article/2008/08/11/AR2008081102462.html
http://www.reuters.com/article/2009/02/24/us-commodities-sovereignwealth-idUSTRE51N28Z20090224

This is what these huge piles of money do to protect themselves. More recently, investors bought huge piles of Swiss Francs because it was the world's most stable currency. However, since such huge investment in the currency suddenly increased the value of the Franc, it caused Swiss exports to become more expensive. This started to destabilize their economy, as producers were having trouble keeping contracts with their buyers. So, the Swiss central bank started manipulating their currency value by offering to buy unlimited amounts of any foreign currency. They succeeded in dropping the Franc's value by around 10%. None of this activity had anything to do with supply or demand of Swiss goods...or goods anywhere for that matter. It was simply massive amounts of investment from a crowd mentality.

Same thing goes for the price of gold. It's just a giant hedge against inflation and/or price spikes in other markets...so you get these accumulations of money in "safe" areas, and that's how you get massive overvaluation of various goods and commodities (bubbles).

It's all due to the level of complexity. "Speculative activity" is a stabilizer when the number of speculators is low, but it has a destabilizing effect as the number of speculators increases.