Bitcoin: The Virtual Currency Bubble?

Bitcoin: The Virtual Currency Bubble?

A recent episode of NPR’s Planet Money discussed a new currency, a virtual currency called Bitcoin.  Bitcoin is essentially a currency predicated on a peer-to-peer system (think: the now-defunct Limewire).  The podcast explores some metaphysical economic questions (what is money?). 

Here is Planet Money’s decription of the story: 

Since the start of the year, the Japanese yen has risen by about 12 percent against the dollar. The euro has fallen by about 1 percent.

 

Then there’s bitcoin, a virtual currency that doesn’t even exist in the physical world. In the past few months, the value of bitcoin has risen by more than 1,000 percent — from less than $20 per bitcoin a few months ago to more than $200 today.

 

On today’s show, we ask: Is a skyrocketing value a good thing or a bad thing for bitcoin?

Abolish the Minimum Wage?

Abolish the Minimum Wage?

That was the proposition being debated on the most recent Intelligence Squared debate.  The debater included James A. Dorn (Cato Institute) and Russell Roberts (Hoover Institution) arguing in favor of the motion and Jared Bernstein (Former Chief Economist to Vice President Joe Biden) and Karen Kornbluh (Former US Ambassador, Organization for Economic Cooperation and Development). 

iPods, Copyrights, and… Star Trek?

iPods, Copyrights, and… Star Trek?

NPR’s Planet Money teams’s recent podcast discussed copyright law as it relates to digital music (21:18 minutes).

Secondary markets exists for most products.  For instance, one can sell an old CD on eBay or Amazon.  “But what about songs from your iTunes library you no longer want?”

This question came to a head in a recent case, Capitol Records, LLC v. Redigi Inc.  After ReDigi developed a business model that created a secondary market for mp3s, the recording industry sued ReDigi for copyright infringement.  ReDigi contended that their business plan conformed with the “first sale doctrine,” which says that once a work is sold, it is the purchaser (not the copyright owner)  who owns the material object in which the work is contained.

The United States District Court for the Southern District of New York, which also quoted Star Trek along the way, wrote:

The novel question presented in this action is whether a digital music file, lawfully made and purchased, may be resold by its owner through ReDigi under the first sale doctrine. The Court determines that it cannot.

…the Court concludes that ReDigi’s service infringes Capitol’s reproduction rights under any description of the technology. ReDigi stresses that it “migrates” a file from a user’s computer to its Cloud Locker, so that the same file is transferred to the ReDigi server and no copying occurs. However, even if that were the case, the fact that a file has moved from one material object – the user’s computer – to another – the ReDigi server – means that a reproduction has occurred. Similarly, when a ReDigi user downloads a new purchase from the ReDigi website to her computer, yet another reproduction is created. It is beside the point that the original phonorecord no longer exists. It matters only that a new phonorecord has been created.

More On Beer Monopoly

More On Beer Monopoly

Not Brewopoly, the beloved family board game, an actual monopoly.  As was noted in the inaugural post of the SLACE Archive, Anheuser-Busch InBev is attempting to purchase another beer conglomerate–Grupo Modelo.  That Planet Money story used the attempted purchase as a predicate for discussing the economic effects of monopolies.  This story, on All Things Considered (11:30 minutes), discusses the economic battle between big beer and craft brewers and how many of the hip craft beers you think you are drinking are really owned by Anheuser-Busch InBev.

Special thanks to Jack Foster for bringing this story to my attention.

The Disability Boom: America’s De Facto Welfare System

The Disability Boom: America’s De Facto Welfare System

After a half of year of investigation, Planet Money’s Chana Joffe-Walt reports a disturbing trend in the American economy-the constantly increasing number of of Americans receiving federal disability payments. The number Americans on disability has doubled in the last fifteen years. Currently, there are fourteen million people receiving disability payments, nearly a quarter of all adults in some towns and counties. The Planet Money team argues that the disability system has become a de facto welfare system and an economically inefficient one at that. The causes of this startling trend include the changing economy, lawyers, and, surprisingly, kids.
The results of Joffe-Walt’s findings will be on NPR all week this week. The full story was the focus of This American Life (59:17 minutes). A preview of the story is available on the Planet Money Podcast (13:38 minutes). The Planet Money website includes some fairly startling graphs about the problem. Finally, parts of the story will also be featured on All Things Considered.