It’s not the first time that I see otherwise intelligent, cultured, knowledgeable and well meaning minds give in to the pressure of opinating on something they might feel they should know about but they do not. Although I had never heard of Mr. Cowen before, he seems to have many tools in his bench, as far as economics is concerned. And yet, he uses generalizations that have often worked for him in the past, glossing over detail in the hope or the unwarranted assumption that detail doesn’t matter and that he has seen it all already. $50 per coin, i.e. 1.05bn marketing cost for Bitcoin? Come on, some reality check! Also, why would a druggie prefer to spend ten $50 Zitcoins instead of one Bitcoin to buy $500 worth of weed? It is just stupidity, unless you account for a possible tiny revaluation effect during the transaction lag. Also, like pundits much less educated than he is, Mr. Cowen talks about the Crypto deflation monster. BTC is currently not deflationary but inflationary, since Satoshi’s printing presses are humming along nicely. It will be deflationary when the worth of merchandise starts being measured in Bitcoin if by that time it is still encountering growing demand, and deflationary in earnest if it makes it to the fateful 2140. I have no idea if my paltry collection of toy Bitcoins will be worth their weight in silicon in a few months, but his concluding statement is a non-sequitur from the vague noises over marketing expense, marginal cost and other misused paraphernalia from Samuelson’s book he brandishes here.
