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Thoughts from the Netherlands; Travel and techie tips; A serious look at bitcoin

The Netherlands is the best place to do business in Europe. The Dutch are super-friendly, super-helpful, super-honest and super-entrepreneurial. I have a dozen stories from our six days.

Tonight, we stopped a bicyclist and asked him where our restaurant was. He didn’t know and rode off. Five minutes later he was back and showed us to our restaurant. Name me one other city in the entire world, that you’ll find a total stranger going so far out of his way to help two lost tourists.

I’ll regale you with more stories in coming days.

Techie and travel tips

+ Trump followed me all the way to Amsterdam. I learned you cannot unsubscribe from any Trump mailing list — no matter how hard you try. Avoid getting on them or you’ll be bombarded with begging emails several times every day.

+ Never tell your email client to sort out junk email. No email software can figure what’s good and what’s bad. They’re not that smart. They will end up dumping important emails into your junk folder. Then you’ll miss out on important stuff. Just tell your email client not to check any incoming email.

+ I’m very impressed with the specs on Apple’s new faster MacBook laptops. I haven’t bought one yet, but I’m oh-so tempted.

+ I did buy a new iPhone 13 Pro Max. It’s totally wonderful. With a trade-in of my old iPhone 12 Pro Max, the iPhone cost me only $441. Which I think is real bargain for the latest, greatest and largest iPhone.

+ KLM is a seriously good way to fly to Amsterdam. They’re really great.

+ I always get jet lag both ways. I have no solution, except to nap when I’m tired. Ten minute naps work wonders for me. I have learned to nap anywhere and anytime.

+ If you made the airline reservation, you can change it. If a travel agent or a service (like Expedia)  made your booking, they have to change your flights. That can be a pain — unless you have a really great travel agent, like Barbara Freedman.

+ Much of the covid testing madness will disappear in November, when governments change their rules. Wait until then to travel to Europe. We didn’t. We wasted time and money with tests and more tests and overnight fees. If it weren’t so large, my nose would be worn out by now.

+ We flew JFK to AMS (Amsterdam). We flew business class. Had we changed our flight to AMS-BOS Boston, our fare would have risen threefold. And it wasn’t cheap to begin with.

+ Verizon charged us a fortune for using Waze to get around Amsterdam. And hen more more every time we called someone — locally or back home. Once you understand how to use the plus sign (+) to make international calls, you’re halfway home. Verizon’s error messages give obfuscation a whole new meaning.

All that’s understandable given how lousy they are at running their basic business. Throw their major competitor, AT&T, into the mix and suddenly you see two dullards trying to outdo each other’s stupidities. Look at this 2-year chart. The blue is Verizon. The brown is AT&T. And the green is the Nasdaq. Verizon and AT&T are in the hottest business on the planet — telecommunications. And they manage to muck up their God-given opportunities at every turn. I wish I could spend a month consulting with one of them. I’d do it for free.

All about bitcoin

I don’t own bitcoin. I’ve never owned any. Everything I’ve read about it scares me. But I’m greedy. So I keep researching and studying crypto-currencies, thinking that somewhere along my journey a magic genii will appear before me with The Solution for crypto to make me rich beyond my wildest dreams. No magic genii — yet.

In recent days, I read this piece from The New York Times.  The writer does a brilliant job of distilling every one of my fears into a single, short article. Read it and see if it makes some sense to you. Let me know.

I do know the first bitcoin ETF has just started trading. It’s a good time to read this piece:

Bitcoin Cosplay Is Getting Real

by Binyamin Appelbaum

It’s been a good month for Bitcoin believers. The currency of the future — or is it the future of currency? — became legal tender in El Salvador.

Some might dismiss as a publicity stunt the embrace of a digital currency by a country where only a third of the population has internet access. Some Salvadorans took to the streets to protest. But let’s not minimize this moment. Esperanto, the language of the future, never managed to become an official language in any country.

Bitcoin, for the uninitiated, is a technology that purports to solve a host of problems with old-fashioned national currencies. It is designed to safeguard wealth against the depredations of inflation, public authorities and financial intermediaries.

Unfortunately, it doesn’t work. Some products become popular because they’re useful. Bitcoin is popular despite being mostly useless. Its success rests on the simple fact that the value of a Bitcoin has increased dramatically since its introduction in 2009, making some people rich and inspiring others to hope they can ride the rocket, too.

It’s not really a virtual currency at all. It’s virtual gold, a vehicle for speculative investment made possible by some interesting technical innovations. It’s the absurd apotheosis of our financialized economy, an asset unmoored from any productive purpose. In the beginning were bonds and then synthetic bonds and then Bitcoin.

The popularity of Bitcoin and its hundreds of imitators is also a product of understandable confusion and uncertainties. In this era of technological disruption, it’s hard to tell which parts of human life might be improved by the internet, and those who didn’t foresee the rise of, say, Amazon should be hesitant to write off the future of Bitcoin.

But it’s worth being clear about what Bitcoin is right now.

The supply of Bitcoin is capped by design, which is meant to prevent inflation. That doesn’t mean the value of Bitcoin is stable. Sometimes it goes up, which is a nice benefit not generally available with traditional currencies. On the other hand, sometimes the value goes down just as fast as during a bout of hyperinflation. El Salvador, which is requiring businesses to accept Bitcoin, has promised to make it possible to rapidly convert it into real money. That’s not exactly the hallmark of a useful currency.

The rigidity of Bitcoin’s design also makes it dangerously impractical as a replacement for national currencies. It is part of a long tradition of trying to prevent politicians from making bad economic policy decisions by preventing them from making any decisions. The gold standard is an older example of this disastrous concept.

The security of Bitcoin is greatly overstated. It can be lost. Indeed, by some estimates, 20 percent of all the Bitcoin in existence is no longer accessible because the passwords have been lost or forgotten. In 2018, more than 100,000 people lost the Bitcoin and other virtual currencies they had entrusted to a Canadian company, Quadriga, after the founder died suddenly, leaving behind no record of the password to the company’s virtual vault.

Bitcoin also can be seized or stolen. During World War II, the German government relied on a code called Enigma, which its mathematicians insisted was impossible to break. The British famously broke it, basically by figuring out the password. That’s also how the federal government apparently recovered part of a Bitcoin ransom payment worth several million dollars from hackers who took down the Colonial Pipeline and blackmailed its owners this year.

Perhaps most important, Bitcoin is difficult and expensive to use as a currency. To the extent any people manage to use it, they mostly rely on a growing infrastructure that looks a lot like the traditional financial system. El Salvador hired a financial firm to create digital wallets for its citizens — which are basically what used to be called bank accounts.

Virtual currencies, much like pickup trucks, are marketed for off-road use. But the reality is that the vast majority of users choose to stay on the streets and highways.

It’s possible, but hardly evident, that this new infrastructure will improve upon the existing financial system — for example, by making it cheaper to move money across borders. But that hasn’t happened yet. For now, the people using Bitcoin are basically a bunch of cosplay libertarians participating in a game of make-believe on the playgrounds of the nanny state.

Most Bitcoin holders, of course, don’t even see it as a currency. They’re in it to get rich, which is the one service that Bitcoin has managed to deliver.

There are reasons to worry about this, too. Bitcoin mining is an environmental disaster, requiring vast amounts of electricity — more than the nation of Finland.

Speculative frenzies divert resources and attention from productive investments.

And the bigger the bubble, the greater the damage when it pops.

But until this month, I wasn’t all that worried about Bitcoin. The current frenzy is sometimes compared to other famous bubbles, like the Dutch tulip craze of the 17th century. One key commonality is that both involve a relatively small group of investors with money to burn. Most Dutch didn’t buy tulips; most Americans don’t own Bitcoin.

If politicians start taking Bitcoin seriously, however, that would be reason for greater concern. It is a pleasant illusion that the problems in the financial system can be solved by replacing it rather than doing the hard work of fixing it. That kind of escapism makes for entertaining chatter on the internet. National leaders really should know better.

The Dutch and their wooden shoes

The farmers used scythes to harvest their crops. If they missed the crops, they would get their toes. Hence wooden shoes for protection.

No one wears wooden shoes any longer because they’re hideously uncomfortable. You need really thick socks. But the Dutch are great marketers and they morphed their wooden shoes into clogs like these:

Amsterdam is probably the bicycle capital of the world. Yet I’ve seen more Teslas here than anywhere else, including New York. The city fathers are encouraging EV (electric vehicle) cars with charging outlets on more and more street corners. All the Tesla owners I’ve met are ecstatic about their car.

More fun stories about Holland tomorrow. Right now, I got to get some sleep. Our plane leaves in a few short hours. Life is fun.  — Harry Newton