Tuesday, 29 July 2014

BitCoin: Like Father Like Son

Bitcoin symbol
In Bitcoin We Trust
Yes, it's a very odd concept when I first heard it. But the more I studied and analysed it, the more fascinated I got. This is the Bitcoin as I see it.

Like the Internet, the Bitcoin was born free. They're both not owned by any government or company. They're decentralised.

Maybe it was simply a coincidence, the BTC (original currency code for Bitcoin. Now XBT) came to this world during early 2009 soon after the Fed announced QE1 (quantitative Easing 1) on Dec 2008 to resuscitate the fatally wounded U.S. economy. As the QE progressed, the gold price rose considerably to all time high.

Gold feeds on fear, whether it's economic or political uncertainty (or both). The economic uncertainty and the loss of faith in fiat currency started in 2008 spurred many investors to look for alternative store of value. Gold was the traditional alternative. When Bitcoin arrived on the scene just the opportune moment, it was the alternative to gold, for those who believe that this revolutionised digital currency is a form of store of value.

Gold price chart from 2009 to 2014
Gold price from 2009 to 2014
Source: Kitco

Gold started to fall at the all-time peak in late 2011 as the fear subsided. As stock market rose from 2011, gold was on a steady decline. Money flows between asset classes. From 2008 to 2011, money flew out of stock and into gold asset. From 2011 to 2014, that flow reversed direction because stocks provided higher price rise due to QEs while gold had a hard run, and needed a rest to catch its breath. Also, Indian government has been trying to make it hard for Indian to buy gold lately.

Bitcoin was on a meteoric rise since its birth, even during the period when gold fell.

BTC - like gold - was nourished by the uncertainty and instability from 2008 to 2011. If it was born in, say 2012, its birth may not as welcoming or promising or as successful. One could only speculate. It was a blessed birth.

 The Toddler Years 
During the early 1990s, surfing the net was synonymous with looking at porn. That's why all that beeping and hissing modem sounds tend to be heard at night. That was not much else on the Net in those early days. In fact, child porn started literally one month after the official opening of the Web in Feb 1993. The online adult entertainment industry - made up some 80+% of the Internet - helped to bolster the Internet's promising future (throughout this article, I'll ignore the technical differences, and use the terms "Internet", "Web" and "Net" interchangeably. The context should make it clear what I actually refer to).

This is the 2nd likeness that Bitcoin shares with its daddy the Internet - its unsavoury beginning. The Silk Road is doing for Bitcoin what the porn industry (illegal or otherwise) had done for the Internet. These less than wholesome industries helped to fuel the growth of the Internet and Bitcoin.

Silk Road websites
Silk Road website and its contraband trading
Source: wikipedia

The online porn industry have grown many folds today alongside the growth of the Internet. The adult entertainment industry no doubt will continue to expand, but its slice of the Internet pie will continue to shrink as every conceivable area of interests are joining the virtual world with social media and video gaming leading the charge (for now. Something else will come along).

The point is, the Internet haven't found its many higher callings in those early days. That came later when it's growing up and take up many more interests. One could certain that will also be the case for Bitcoin where this illicit use will continue and even expand, but it makes up smaller and smaller percentage of the whole Bitcoin pie.

You could say the Internet were paid by porn, especially during the nascent period of the Internet. Just a related side note, many of the adoption of innovations of media technology were also driven by porn: Polaroids (you don't want your naked photos developed by the photo labs), digital cameras (you're the director), video chats (need I explain?), etc.

Where would media technology be without porn? For one thing, its growth would be much slower.

U.S. law enforcement agencies website seizure notice
U.S. law enforcement agencies website seizure notice
source: wikipedia

BTC didn't give the Silk Road operators diplomatic immunity, and they have been stamped out by law enforcing agencies around the world. These operators had been doing vice trades before the invention of the Internet. When Internet came around, they made use of it. When Bitcoin came around, they didn't play favourites.

Bitcoin critics would like to discredit Bitcoin because of its use in Silk Road. The Silk Road traders probably also use Swiss Bank, mobile phones, or any other tools to do their deeds.  They're very fair that way.

Don't blame the tools; blame the people. One shouldn't throw the baby out with the dirty water. (I have more of these snappy sayings where that come from).

Silk Road operators also helped to prove the concept that Bitcoin works well. It's besides the point if it's tested by criminals. In fact, Open Bazaar Project was the above ground market place that was grown out of the Silk Road concept.

Bitcoin detractors dismiss Bitcoin because they can't see any other functions of BTC beyond Silk Road, which in turn because this digital currency is still in its infancy with its many potentials waiting to be discovered or realised.

It's not where something had been, but where it's going that matters.

This period of growing is always the most difficult when it starts to engage its critics. During the toddler years, Bitcoin would be too small to be under the radar of public interests. When its market value reached the psychological 1 billion dollars mark, it attracts some unwanted attention.

[ Growing Pains ]
Grown ups would love to give the adolescence lectures of their abundant wisdom. Many of these growing pains came from critics who doubted Bitcoin's legitimacy of its existence.

Some of these critics, whom we consider financial experts, appeared on CNBC as guests to denounce - ok ridicule - Bitcoin. Maybe it wasn't done out of contempt, but fear. Let me explain.

Since the Fed has such a cosy relationship with Wall Street, and came to bail out every mistakes from the LTCM fiasco in 1998 to the wholesale bailout of Wall Street in 2008. So if something like the Bitcoin was created outside Wall Street, and it's a currency that meant to take power away from the Fed, Wall Street folks wouldn't take it too kindly. If Bitcoin isn't a friend of the Fed, then the Wall Street suits would see it as a threat.

Let me try to defend some of the labels these Wall Street types slapped onto Bitcoin.

Ponzi Scheme
This is one of the most popular name that Bitcoin being called. The CNBC guests were quick to give it that label. This knee-jerk reaction is understandable considering the recent financial events that took place just before this broadcast. Imagine someone who was one of your own on Wall Street. Someone, who is arguably - quite respectable - turned out to be the ring leader of a Ponzi scheme circus, ripping off millions from his clients that included big name Hollywood celebrities.

Bernie Madoff
Bernie Madoff
Madoff made off with millions right in the heart of Wall Street.  He has an established name, and only people with influence and connection could join his Ponzi scheme (which was a brilliant move on the part of Madoff).

For the Wall Street people, once bitten, twice shy. Even if the experience is second hand.

On the other hand, this Bitcoin thing was born outside Wall Street, and so that alone would warrant suspicion from the Wall Street suits. The whole financial world is losing trust, including those in it. I detect some resentment in their ridicule of Bitcoin. We can hardly blame them.

In a Ponzi or pyramid scheme, you need a big cheese (or big enchilada, depending on your taste), but we don't have a person in such position in Bitcoin in any way, shape or form.

Bitcoin just doesn't have a pyramid structure. The selling point of Bitcoin is decentralisation and transparency. The Ponzi scheme has neither. Decentralisation suggests there're no head poncho that is the defining feature of a Ponzi scheme. Madoff scheme worked - before it was busted - because its reports that it sent to its clients are cooked up by Madoff. It wouldn't have worked if there was more transparency.

I think it looks more like a square, or a ticket line for a rock concert, or even a dodecahedron. But it ain't a pyramid from any angle I look at it. People are seeing things.

In short, if it's a scam of some kind, why hasn't the U.S. government stepped in and shut it down after nearly 5 years? Unlike Madoff's private operations, Bitcoin is an open system where governments around the world have full knowledge about it.

The governments had crackdown on the illegal Silk Road Operators who used BTC, but they didn't outlaw Bitcoin. The question if Bitcoin is a scam should be already settled by now (although I still hear such voices). I'm very interested to know if these CNBC guests still hold these views today. Scepticism is healthy, but they should do a bit more homework first.

Tulip Mania
Although not categorically correct, this is a better characterisation of Bitcoin than a Ponzi scheme. Tulip mania and Ponzi scheme are completely different things, and yet according to some, Bitcoin is both. Speculator of the tulip mania bought tulips with the understanding that it had no value other than its potential rise during the craze.

Tulip Price Index during the tulip mania
Tulip Price Index during the tulip mania
Source: wikipedia

At the very least, Bitcoin is a revolutionised decentralised, p2p payment system. And whatever else values Bitcoin supporters give it is on top of this basic service. You can have something that has value but still could be very overvalued.

The CNBC guests mentioned the dotcom bubble of 1999. Many internet related companies were very overvalued during the dotcom bubble. Microsoft is an example of this in bubble state. Microsoft's stock price valued a all-time high near the end of 1999. When the bubble burst, its share price collapsed, had never recovered since.

Mircosoft price chart from 1999 to 2014
Mircosoft price chart from 1999 to 2014
Source: Yahoo Finance
(Click to enlarge)

On the other hand, Amazon also participated in the bubble of 1999. Its stock price also rocketed to unrealistic level. Without exception, Amazon share price collapsed like the rest of companies in the dotcom sector. But its stock price today dwarfed the stock price during the bubble of 1999. But nobody call Amazon a bubble today.

Amazon price chart from 1999 to 2014
Source: Yahoo finance

Internet companies aren't tulips. Tulip produces no economic outputs, but these companies do.

There's nothing wrong with Microsoft or Amazon, but they still could reach a bubble state. On hindsight, Microsoft's price in 1999 was a bubble, but Amazon, not so much. And Amazon wasn't the only one. In fact, Apple was even a better example. Its price during 1999 is only a little blip, much like the peak of BTC in 2010.

Why is it that Microsoft stock price hadn't recovered from its peak in 1999 while Amazon left it in the dust?

This answer is very complex to answer. One simple answer would be that Microsoft was a far more mature company than Amazon in 1999. Microsoft's market sector is also more mature than Amazon's. Hence Amazon has far more growth than Microsoft as a newer company in a new market. Another thing is that Microsoft isn't strictly a dotcom company, but it has products and services that benefit from the dotcom growth.

Many IT or dotcom companies survived the 1999 bubble bust went on making impact on the world.

Bitcoin maybe going through such a phrase. Or maybe simply the very early stage of a bubble. Nobody knows. Not yet.

If we compare Bitcoin to the 1999 tech bubble, it would be more like Amazon than Microsoft during the 1999 bubble because of its infancy.

Remember too that these bubbles are recurring, and is called cycles. Gold has many such cycles in the past. Bitcoin is no exception, and there were already three in the past.

While tulips are similar to gold or Bitcoin in that they don't have any economic outputs like companies, but they don't last long. That makes them have no economic value.

I only mentioned the dotcom bubble because of the CNBC video. Gold would be a better comparison with Bitcoin than dotcom companies as both the prices of Bitcoin and gold are valued quite different from companies. The prices of companies are valued based on DCF (discounted cash flow). Since neither Bitcoin nor gold generates income streaming or cash flow, they priced at whatever the market decides they should be worth. Their prices boil down to the only force that any (unbiased) market obeys: supply and demand.

If tomorrow, something terrible happens to Bitcoin, its demand will reduce to zero, and so its price will follow. If more and more people warm up to Bitcoin in the future, its demand will increase, and so will its price.

Looking at the gold chart over many decades, they have many "bubbles" or price spikes, which then collapsed. But the subsequent "bubbles" would usually dwarf its previous "bubbles" and making them look like blips. Not dissimilar to the Bitcoin situation, except gold covers a longer time span. But this could simply because BTC is still in its early days in addition to the perfect timing of the arrival of Bitcoin.

Bitcoin price chart from 2009 to 1014
Bitcoin price chart from 2009 to 1014. It price had gone up more than 10,000%
Source: Mt. Gox

Just like gold, BTC's price will be decided by the market. Because of the perishable nature of tulips, it couldn't be used as a store of value. One of the CNBC guest, Michael Pinto, said that Bitcoin shouldn't be used as a currency because it could be destroyed (technically the term is 'durable', which is 1 of the 4 must-have property of a currency, but I'm not going to be pedantic). Actually banknotes could easily be destroyed, but a Bitcoin couldn't be destroyed. You can't destroy virtual reality.

Bitcoin could be hacked and stolen, so could banknotes be robbed, burgled or pickpocketted. You can lose your Bitcoin wallet, so can you lose your leather wallet, and far more likely because you carry it out in public everyday (and a Bitcoin wallet costs you nothing, and your leather wallet could be the most expensive thing in your wallet. Sentimental value is priceless). If you keep your Bitcoin wallet offline, you remove the possibility of your wallet being hacked. Could you be tricked by buying Bitcoin? Probably just as much chance as buying fake (less than pure) gold or silver from dodgy sellers. As far as the measure of durability and safety, Bitcoin is superior to banknotes or gold.

Mt. Gox
Mt. Gox's bankruptcy was one of the many trials and tribulations that Bitcoin had to face as it was growing up. It proved to have passed the test as the crypto-currency soldiered on after this temporary setback.

Mt. Gox exchange website home page
Mt. Gox exchange website home page with an ironic catchline of
"Trade with Confidence on the World's largest Bitcoin exchange" in hindsight

Pie chart of Bitcoin volume distribution by currencies
Pie chart of Bitcoin volume distribution by currencies (July 2014)
Source: bitcoinaverage.com
While its impact was considerably on the Bitcoin community as a whole, one specific sector of it felt this fiasco the keenest.

Since Mt. Gox was Tokyo based and the largest Bitcoin exchange at one time, it would be logical to think that if the JPY currency traded if not the heaviest, it would be at least 2nd or 3rd heaviest currency after USD.

If we look at the currency volume distribution chart for today, we can see that the BTC trading volume in JPY ranks 11th (even less than NZD).

The Mt. Gox naturally made Japanese shy away from trading BTC (at least for now. Time heals all wounds).

Chinese, on the other hand, are big savers but have limited outlets for them to put their savings. Property is in a bubble itself and unaffordable, and stock market aren't for the average folks. So they turn to gold. And many believe gold and Bitcoin serves the same function of gold as a store of value, rightly or wrongly.

If the Chinese could affect the global gold prices, they certainly can do so with the much tinier Bitcoin market.

Money Laundering
This is another thing Bitcoin is quite often being accused of - being used as a tool of money laundering. This digital currency has a somewhat contradictory features. It has the quality of transparency and anonymity. So the result is a compromise of the two.

This mixed outcome in Bitcoin transaction being pseudo-anonymous. Its anonymity of transaction is therefore somewhat between credit card and paper currency. So why would money launderers prefer this virtual currency over the more anonymous paper currency for money laundering?

Furthermore, the laundering of paper currency had been well established and money launderers are very experienced at it. They may have used BTC for money laundering when it was new and they were one step ahead of the law enforcement. Once this is understood by both sides, using it as money laundering isn't such a good idea.

Once again, don't throw the baby Bitcoin out with the laundry water.

Most of the issues I outlined above - money laundering, Ponzi scheme, Silk Road - are not real issues. They're image or perception issues. These things have nothing to do with BTC, Unfortunately, perception is sometimes as important - if not more important - than reality.

Volatility, on the other hand, is a real issue for Bitcoin. Low liquidity causes large swings in stock prices for small companies. Same thing happens to small market like Bitcoin. This is especially when the Bitcoin markets are fragmented with many exchanges around the world. This gives rise to low liquidity issue at any given exchange.

A baby can double its height in 1 or 2 years; a toddler can double its height in 5 or 6 years; an adolescence's growth spurt is slower still.

This volatility should reduce as BTC market grows, and more players like merchants enter the market. It's a bit of a catch-22 situation. The large volatility would discourage merchants in participating in the world of crypto-currency. Still, in time, the volatility will likely to decrease with more Bitcoins enter the system and the Bitcoin participants are expanding.

Contrary to popular belief, speculators don't contribute to market's wild swings. In fact, speculators increase market liquidity, and therefore lower market volatility. Speculators are like the grease for the Bitcoin machine. Without them, Bitcoin is still clunking along. With them, Bitcoin should run more smoothly.

While I don't know it for a fact, I don't rule out some manipulation of BTC market that could also further lead to large volatility. Once again, manipulation of the Bitcoin will become increasingly risky for manipulators as BTC rises in values. As Bitcoin market had grown exponentially in the last few years, as should the risk of manipulation grows exponentially. This is , once again, where regulators can be instrumental.

Last but not least, in the early days when there're few miners, and the mining operations hadn't been perfected, there were a much higher chance of Bitcoins at any time not being supplied.  This led to a temporary supply-demand imbalance. Another scenario of supply-demand imbalance is that because in the early days, the Bitcoins didn't worth as much, they weren't converted to fiat quickly via selling. Remember that many early miners definitely weren't do it for money because there was no money in BTC market when each Bitcoin is measured in fiat cents.

Having said all these, volatility has been relatively calm since 2013 when we didn't see any sharp spike like those in previous years. This is good for Bitcoins. Of course, it's still unstable relative to fiat currencies. As I said, still early days.

Fake Money
I understand it when some call Bitcoin fake money, toy money or Monopoly money (best name). Because up until now, Bitcoin holders have very limited places to obtain goods or services for their Bitcoins.

Bitcoin Accepted Here Sign

While Bitcoin is called and intended to work like a currency, because of its limited acceptance in the business world right now, most Bitcoin participants treat it more like gold than a currency. Much like gold, Bitcoins are bought in the hope of its rising price in the future because of its limited supply, and its price is being determined by nothing but market participants.

This is why Bitcoin are so intriguing for many academics and economists who studying it. It's unlike anything that came before it, and yet it has qualities of many things that came before it. It could be seen as a global digital currency, store of value, payment system, and whatever else we discover in the future.

Bitcoin is considered by some as fake money because it has no intrinsic value. Its value is based on faith, which is no different from the fiat currency we're using ever since the gold backing was removed. Another thing that make paper currency appears to be more real than Bitcoin is the actual tangible paper where the currency are printed on. We can solve this psychological problem by printing Bitcoin paper money. But that's going backwards, not forwards. I guess that's the crux of the matter, Bitcoin is too dissimilar to anything that came before it, and it will take some getting use to. There has to be a shift in the mindset before it could be accepted widely.

Monopoly money
Monopoly money

Having said that. Today 97% of transactions in U.S.A are done digitally. Nowadays, who actually receives pay packets? Money are transferred from one bank account to another, whether we do so directly or using our credit cards or cheques. So the idea of using a digital currency from using electronic money today (not tomorrow) isn't really a quantum leap. In fact, electronic money has been around for awhile, and is looking like old money by now.

Perhaps the most important thing that people attach the paper currency with is that they're endorsed by their governments as legal tender. No such status exists for Bitcoins, which makes it being viewed more like gold than currency. I think this is probably the most significant criteria if Bitcoin is to be adopted almost instantly and universally.

In a way, such move would contradict the spirit of a global currency that it's independent of any government. The only institution that could endorse Bitcoin to be a global currency would be some international institution like UN or World Bank. I can't see this going to happen. At least, not in the foreseeable future.

One can't really talk about Bitcoin - or fiat currency for that matter - without mentioning gold because of the similarities they share. It had been mentioned a few times in this article.

Gold had been used as the medium of exchange for many cultures around the world before the paper banknotes became the norm. So when there's a widespread loss of faith in the fiat currency, people naturally turn to gold.

Gold bars
Gold bars
Source: wikipedia

Several Western currencies were used to be backed by gold. The gold standard were taken off one by one (usually so they could print money to pay for wars). Depreciating currency becomes the norm because of inflating supply. People today buy gold to hedge the currency devaluation. In other words, the governments divorced their currency from gold, and their citizens who buy gold are trying to re-marry the couple, in a sense.

Some are talking about bringing back gold as legal tender. Some states in the U.S. already have done so (Utah, Texas, et al). So Americans can't blame foreigners for losing confidence in their currencies. U.S. States lose faith in their own currency.

How practical is such a move (not specifically refers to those states)? Are we going to lug a few a gold bars around to pay for cars, holidays, houses, etc? Well, one can keep the gold in the gold vaults and pay by electronic mean. You may actually never see the actual gold bars. You'll get some certificates to say that you own them, and monthly statements showing the transactions. How much different is physical gold in this way differs from Bitcoin if one never lays their hands on one?

Dollar Standard
Increasingly, the talk of the demise of the American Empire due to its economic and financial ills in the system is getting louder (if you prefer the term "superpower" over "empire", I'm not going to be pedantic about it. To me, "superpower" is just a modern term for (or modern form of) the traditional "empire"). One of those delivered this prophesy of doom is the award winning documentary entitled Four Horsemen. Others who joined in the chorus including Mike Maloney, who runs the Hidden Secrets of Money website, pointed out the demise of empires throughout the ages from Greco-Roman Empires to the British Empire were all accompanied by the demise of their fiat currencies. Jim Rogers and George Soros also believe the collapse of the US currency (as a reserve currency or not) is inevitable. Well, nothing last forever.

This thinking also helped to spur the growth of Bitcoin.

Take a look at the global currencies since the Portuguese Empire, which marked the start of modern Western domination of the world.

Historical chart of the ages of global reserve currencies since 1450
All parties must eventually end
(Source: fxempire.com)

This chart simply suggests USD as a global reserve currency is approaching its historical used-by date. Funny enough, the longevity of these modern Western empires - for one reason or another - last about a century. The demise of the empires logically follow the deaths of their global reserve currency status because this status allow the empires in question undue power and influence in the economic (and thus political) sphere. More money more guns.

Of course, the conclusion that the end of Dollar Standard isn't something that's based solely on history, but it's based on what's happening to the US currency as a reserve status, right now.

Mike Malony made the following episode, which appropriately called the Death of the Dollar showing how nations around the world are holding USD as their monetary reserves in a declining trend. The BRIC countries, especially, are doing this more keenly.

While Maloney is a goldbug, he was more positive about Bitcoin than previously as evident from this video.

They prophesied the dying fate of fiat currency and a return to gold. What if we have a 21st century alternative? Gold was always considered as an alternative when fiat currency is bellied up because there was no 2nd alternative, until now. Okay, there're other precious metal alternatives. But when I say gold throughout this article, I mean precious metals - gold, silver or platinum. I actually like silver more than gold as a hedge against currency devaluation (or collapse in worst case scenario) because silver is more undervalued than gold.

Just a comment regarding to what Maloney said in the video, "...Bitcoin is a digit that grows to a certain point, and eventually stops". I believe he was talking about Bitcoin's divisibility, which is one of the 4 must-have property if it's needed to be qualified as a currency. He erroneously saw this divisibility of 8 decimal places as a limiting factor of Bitcoin's potential. There's no stopping in Bitcoin in terms of its divisibility.

Side note: a Satoshi is the base unit (or the smallest divisible unit) in a Bitcoin at the moment. As I said, the protocol can be easily changed to accomodate smaller unit. There's simply no practical limit to the BTC's divisibility.

Bitcoin, as it stands today, can be divided into a maximum of 8 decimal places. I suspect we wouldn't have to worry that it runs out of decimal places in our lifetime (the Bitcoin holders would be ecstatic if it does !). If the BTC grows so large that even 8 decimal places aren't enough, the Bitcoin protocol could easily be changed to accommodate any additional number of decimal places one would like. This is a far less of an issue than Y2K because this issue had already bought up when Bitcoin was born (and Y2K didn't end the world as we know it). What a delightful problem to solve. Oh no, my wallet is simply too small for my stash of cash ! What am I going to do?

Here I like to point out once again that even somebody who supports Bitcoin and an expert in currency still having problem grappling with some of the technical issue. Warren Buffett simply called it a "joke" and says it has no "intrinsic value" (his favourite phrase). He didn't get it either. I bet he didn't spend considerable time in studying it. Why would he? He didn't have too many positive things to say about dotcom companies because he didn't and still doesn't understand them. Bitcoin has to be more difficult to understand than dotcom companies for him.

Is the world going to end because USD as a global reserve currency is ending? It won't happen overnight, but gradually over many decades (you may not even see it in your life times, depending on how old you're). So its effect is probably not very noticeable, but adjustments would constantly be made over time.

Would it be replaced by Chinese Yuan? Chinese Yuan is nowhere near ready. And why wouldn't RMB suffer from the same issue as a global reserve currency status as USD today one day (many generations from now)?

What about SDR? SDR is based on a basket of currencies. But they're still fiat currencies. That's just the same story played by different actors (or more actors). Maybe the future reserve currencies should be backed by a basket of limited supply materials instead of printed papers. The basket might consist of portion made up of different currencies, precious metals, and Bitcoin (why not?).

Government Regulatory Control
This is the 4th trait that Bitcoin inherited from its daddy the Web. Like the Internet, Bitcoin is born free, and not owned by any government or company. In reality, while the Net is in many ways still a global, non-sovereign entity, on the other hand, some parts of it are very much under the direct controls of various government bodies, companies, and so forth. For example, in various countries, the Web can be, and is censored to various degree. Search engines, on the other hands, are owned by companies. The web's Infrastructure providers like ISPs are companies that abide by the rule of the governments, etc.

Similarly, government controls are applied to Bitcoin via its various infrastructure. All BTC exchanges around the world are subject to the laws and regulations of that country. Take Coinbase, which is American company. If U.S. puts an economic sanction on a particular country, you will find that Coinbase won't be able to do business with that country. So the ideal of an utopian currency in a world without sovereign state interventions can't really exist.

The idea that Bitcoin is a payment system that would get rid of the middlemen. Yes, we still don't have the middlemen in Bitcoin when we send or receive payment, comparing to say, Paypal, which is the middle man. But we still have "middlemen" in various infrastructures such as exchanges, ATM operators, operators that facilitate merchants' access to Bitcoin, and so forth. Without these "middlemen", Bitcoin can't be used by the popular mass. At least, not at this stage of Bitcoin's development.

On the other hand, government regulations aren't all bad. Some are put in place to protect the users of those infrastructures. At the very least, give the public confidence. One would agree that majority of the public would feel safer to get into Bitcoins if there're more government regulations, not less. Mt. Gox bankruptcy may have been avoided if there were regulation. For example, government may demand exchanges to have things in place that prevents the repeat of Mt. Gox. At the end of day, Bitcoin exchanges are businesses like every other businesses. One would agree businesses should be regulated.

Mt. Gox collapse occurred because it was so new that the regulations hadn't caught with it yet. We need regulators to bring the public into Bitcoin. Without it, BTC would only be some toys in the hands of the few. Nothing works without give and take. That applies to freedom as well. Freedom without regulation is anarchy.

Having said that, just like the Web, while the various sovereign states place censorship on it, but there're always ways to go around it. Similarly, there're always ways to bypass regulatory controls to various degrees. I see these controls by governments that exist alongside with various circumvention of controls not only the way real life operates, but a very human way. And that has always been the way our societies worked. No more, no less.

We're not there yet. Bitcoin is there when it becomes mainstream like its daddy the Net. It gets there when it reaches a critical mass. That happens when supporters far outnumber doubters. When governments step in to regulate. This legitimise Bitcoin, at least in the yes of the public mainstream.

When even the so-called financial experts - even the supporters - have so many misunderstanding about this digital currency, the Bitcoin community has work cut out for them. Of course, they too are learning.

At the moment, it faces many growing pains, issues and self-doubts. Some issues are technical, others legal, and political. One of the technical issue that Bitcoin is facing right now is the dominance of a specific Bitcoin miner. This may break the digital currency if it couldn't be resolved.

One of the thing we should and can do something about it is the name Bitcoin, which doesn't inspire confidence. In business, and definitely in currency, confidence is everything. The decline of USD dominance is precisely that: loss of confidence.

Remember how concerned parents labour over the name for their child? Imagine, especially a child growing up, what a bad name is doing to him or her confidence? If people are going to poke fun at Bitcoin, it certainly has the name for it.

Which part of the word "BitCoin" inspire confidence, and demands respect? "Bit" as in "little bit", "2-bit worth"? What about "Coin"? Sounds like small change, or something for a poker machine. When I first heard the name, I didn't take it seriously because I thought it was tokens for some video games. Seriously, didn't you have the same reaction when you first heard it? Remember, we probably have over 6 billions people on earth who never heard the name.

I know, I know, in the nerdom, "Bit" is cutting edge. Also, BitTorrent is another very popular p2p protocol not too dissimilar to BitCoin. I know it's only a name. Every little bit helps.

Apart from the name, other more serious and challenging technical or operational issues also exists. For example, because one of the Bitcoin feature is its decentralisation. When a miner, which acts as fact checker, monopolies the process, the whole decentralisation ideal is destroyed. We would rather trust our central banker than a central miner. Wouldn't you? They're just individuals.

But one can also trust the miner to regulate themselves not to reach such a position because their absolute or near monopoly would lead to the collapse of the crypto-currency due to its loss of faith in the system. This collapse wouldn't benefit themselves.

motherboard of a dedicated Bitcoin Mining machine
Motherboard of a dedicated Bitcoin mining machine

But if somebody intends to harm such a system for whatever purpose, that's what they need to do. This brings me to the question of regulation. Just as its daddy may have been created under the noble libertarian geeks who want to give people power by giving them knowledge (because knowledge is power) freely, and without any hindrance.

At the end, in order for the Internet to go mainstream, it's needed to be regulated. In many parts of the world, governments try to limit that power by giving only limited access to the Net. This is the 3rd genetic trait that Bitcoin's daddy passed down to it.

In order to go mainstream and function probably, it will needed to be regulated by governments. For example, recently PBOC banned financial institutions in dealing in Bitcoin transactions. Some of the value that may have to be discovered or realised with this deflationary currency is its function as a viable alternative currency to economy that suffered from runaway inflation.

Zimbabwean banknote that denomiated in one hundred trillion dollars
Source: wikipedia

Zimbabwean adopted the fiat currency of USD as a hedge against the severe depreciation of ZWD. While USD is inflating too, but does so at a relatively slow pace than ZWD. It's a lesser of the 2 evils. What if they adopt a deflationary currency? Would it be a boon/boom for their economy? Are we just scratching the surface of Bitcoin's many future potentials ?

While Bitcoin has a long way to go (the Bitcoin community would hope), it had came such a long way since 2009. We don't know where it's going just as nobody knows the future of any growing child. What we can't rely on is where it's going by looking at its unsavoury past. But if Bitcoin is anything a fraction nearly as promising as its daddy, it would be the most important thing since its daddy. ome believe it's more important than the invention of the Internet.

If Bitcoin isn't a scam, what it is then? It's an experiment of a 21st century global currency. An experiment has only just begun. USD is also a fiat currency that accepted globally, but it's under the control of one sovereign nation. This mean that the rest of the world accept the fiat currency status but at the mercy of Uncle Sam's policy towards it. If it needs to go to war and print some money to bankroll it, and therefore depreciate its worth, USD holders can't do anything about it. Fiat currency system isn't very democratic or fair or has staying power.

While Bitcoin experiment could proven to be unworkable tomorrow (I hope not), like a growing human, its chance of dying during an infancy is much higher. It had survived the baby and toddler years, and growing into adolescence, I'm hopeful that it will grow into adulthood. The most difficult, and trying transition is yet to come.

The BTC supporters - usually more technically minded people - would see a bright and promising future for Bitcoins because it's more technologically superior than anything we have, and would cite how technology always win at the end.

Time again and again, we see products that are more technically superior lost the battles because they're market better or reasons other than technology. For example, VHS vs Beta video formats. And surely Windows aren't the best operation systems around technically? Examples abound.

Of course, I'm comparing 2 or more similar technologies rather comparing a technology with something completely different (like comparing apples with oranges). But the same reasoning applies. To a technologist, technology is a panacea to all ills just as a hammer sees everything as a nail.

On the other hand, there're certainly plenty of groups, institutions like Wall Street would like to see Bitcoin go away. And they have the power and resources to do it.

The kid has to grow up to be taken seriously. In BTC community, it means it needs to prove itself to the rest of the world that it has staying power. The longer it survives, the larger the community grows, the more track records it has, the more it will be taken seriously, the less chance that it will fail.

I think BTC is close approaching a critical mass, a point of no returning at which the doubters would be outnumbered by supporters, and would be accepted by public at large. Close, but not quite there yet.

Who knows where it's going? All we know it's going to be an exciting and thrilled ride. If something's worth having, it's worth the risks.

Feel free to donate: 1Ehcs4qPtgMLF6QA1D9ZLTDra5MqNEHRpq

Friday, 11 July 2014

Haw Par Villa and Ten Courts of Hell

Falling in Love with a Snake.   Go to Hell.  Monkey Business.

 The Villas of 2 City-States 
When you visit Singapore and want to see or do something that you do back home, there're plenty of these places to choose from - the world-class zoo, 2 aquariums, botanic gardens, museums, Universal Studios, etc. But if you want to see something weird, wacky and wonderful, something that's uniquely Singapore, in fact, one and only in the world, Haw Par Villa should be your destination.

Actually there were 2 Haw Par Villas (aka Tiger Balm Gardens 虎豹別墅) - one in Singapore, and the other in Hong Kong. I stayed in HK in early 2010 for a few months in Wanchai (灣仔). In fact, it was an area within walking distance to the Tiger Balm Garden (or Haw Par Mansion as it was also called in HK). So naturally, I wanted to visit there, and only to find out that it had been permanently shut down. The place was replaced by residential high-rises.

The first time I was there was in the late 1980s. I'll try to dig out old snapshots (in rare hardcopy) that I took there and post it here (yes, I'm showing my age).

Haw Par Villa, Hong Kong 1999
Haw Par Villa (Tiger Balms Mansion), Hong Kong 1999

I think there're 3 reasons why this Singapore Haw Par Villa survives while its HK counterpart didn't : location, location, location. Before I went to visit there I had a bad feeling that the Tiger place couldn't still around in Wanchai after 3+ decades of economic leaping by this Asian Tiger. After all, HK's property is the most expensive in Asia (surpassing Tokyo, Paris or New York's housing prices).

Wanchai is a HK district sandwiching between the gleaming supertall skyscrapers filled CBD and Causeway Bay, the HK upmarket mega-shopping mecca. This is no place for this old-school, past its used-by date of a relic. So the Villa was leveled in 2004. You could still see pieces of it in a museum, where they belonged.

As I'm an old sentimental fool, the only other time I was so depressed was when I lost my wisdom tooth. It decidedly marked an end of a nostalgic era for me (the Garden, not the tooth). I felt like checking myself into a museum, said to the receptionist, "please give a glass case. Preferably one with a view of people".

There I stand in my glass case in the "20th Century Hall" of the museum for all to see. At my feet is the sign, "Homo Oldtimericus Ridiculous". Right next to me on a glass shelf are some exhibits that this extinct species once used: paper photographs, calculator, 5¼-inch floppy disk and an Apple II computer. Hey, don't forget the Tiger Balm. All the curious things that would make school attendees jaw dropped (or pressing their incredulous faces against the glass) today.

Apple II computer. It's an 8-bit computer. At least, it's not a 2-bit computer.
This screen has 80 character across. So they look like Lego characters.
Source: Wikipedia (Rama)

I decided to leave the museum. I can't really sleep standing up. Ok, I'll owe up. The glass case adds 10 pounds (sorry kg) and I don't want to look like a Loxodonta Elephantidae.

The retirement of HK Haw Par Villa leaves the the Singapore counterpart the only one of its kind in the world. It's saved by its respectable distance from Singapore CBD. What's more, the entrance is free. The media in the West sometimes called it the Disneyland of the East. It's hardly that.

Entrance gate to Haw Par Villa, Singapore
Main gate to Haw Par Villa

 Gaudy Gaudi Theme Park 
It's basically a theme park - or more accurately outdoor museum - for many facets of Chinese culture from mythology, religion, folklores to even historical figures and unique Chinese wild life. And then to mix it all up, it includes things like Thai dancer, Sumo wrestlers, miniature Statue of Liberty into the mix just to confuse the visitors a little bit more than they already have.

The sculptures in this place ain't quite the works of Spanish architect Gaudi, some would think they're gaudy (due to its colour). So let's call its artistic style Gaudy Gaudi. To those who love it, they're Goody Goodies.

Sumo wrestlers, Haw Par Villa, Singapore
Sumo wrestlers with Tiger Balms products in the middle

Tiger Balm products, Haw Par Villa, Singapore
Various Tiger balm products. These balms build this place.

Legend of  the White Snake (白蛇傳) takes up a large section just behind the entrance.

This is a well known folklore that are made into numerous adaptations of operas, movies, and comics. It deserves a place here.

Scene from Legend of the White Snake
Scene from Legend of the White Snake
This is the scene of Xu Xian (許仙) - the Chinese dude - chance meeting with Madam White Snake (the Lady in Red), and her younger 'sister' (in blue) on the Broken Bridge in Hangzhou.

Three Stars of Fu Lu Shou, gods of happines, prosperity and longevity
Three Stars of Fu Lu Shou 福祿壽
gods of Happiness, Prosperity, Longevity
Pagoda with Shayamuni Buddha on top
(click any photo to enlarge)

Confucius with his trademarked palm holding gesture

 Crime and Punishment: Chinese Style 
If you find most of the exhibits you have seen made you scratching your head, wait until you see the Ten Courts of Hell.

Entrance of the Ten Courts of Hell, Haw Par Villa, Singapore
Gate of Hell: entrance to the Ten Courts of Hell

Ox Head guarding Ten Courts of Hell, Haw Par Villa, Singapore
Ox Head
Horse Face guarding Ten Courts of Hell, Haw Par Villa, Singapore
Horse Face

Warning: The rest of this article contains deliciously disgusting graphic images that would make your stomach churn or give you nightmares, or if you're unlucky, both. Don't say I didn't warn you. So enjoy!

Guarding the gate to the Ten Courts of Hell are Ox-Head (牛頭) and Horse-Face (馬面).

While they're a couple of mean-looking guardians of the Underworld (or Hell), in many stories, they also go to snatch spirits just when people die. In that sense, they're more like police escorts than security guards. When they do the role of escorting human souls to the afterlife, they're acting more like psychopomps, which known by different names and takes different forms in different cultures.

For example, in Western cultures - naturally they appear in many Hollywood movies - these psychopomps take the form of a Grim Reaper.

For the Hindus, the psychopomps could be either a person or an animal or something else. As usual, Hindu mythology is complex.

Once you get inside this Gate of Hell, you will be presented with 10 exhibits showing the journey of the soul of the dead from just entering Hell, the judgement and punishments in the 10 courts, and the preparation for reincarnation.

Each of the 10 Courts will be presided by an Underworld Judge, each punishment will be meted out clearly to fit the crime.

Take the example of the 6th Court,

Crime and Punishment in the 6th Court, Haw Par Villa, Singapore
Crime and Punishment in the 6th Court.
Read them well, especially for the readers of Playboy magazine...
 (click to enlarge)

So next time when you're thinking of buying a copy of Playboy or Penthouse (who does that any more?), keep the following photo in mind. Not so attractive heh?

Body being sawn off in the 6th Court, Haw Par Villa, Singapore
Body being sawn off in the 6th Court
(click to enlarge to have a much closer look at the nice statues)

Regarding the misuse of books (my interpretation), remember that next time you break the spine of a book, your spine would be severed when you're down there.

Since every crime and punishment is so clearly laid out, I guess it's okay to look at online porn as long as you don't possess them. I interpret the rule literally to get around this legal loophole. As the dead is spiritual, the rule is therefore interpreted in the spirit of the law.

Don't say I didn't warn you. You may thank me in Hell.

When you curse, cheat or abduct people, you will be stabbed in the back by being thrown into the Trees of Knives, like this. Not too pretty, right?

Being thrown into the Tree of Knives in the 6th Court, Haw Par Villa, Singapore
Being thrown into the Tree of Knives in the 6th Court
(click to enlarge to look it more closely)
Being pierced by the Tree of Knives in the 6th Court, Haw Par Villa, Singapore
How's hanging ? Sipping your own blood much ? Care for some Panadol ?

Want to see another Court? I thought you never ask. Let's look at what they're busy with in 4th Court. First, let's peruse the Crime and Punishment tablet.

Crime and Punishment book
Ok, got it. Let's get on with it.

Punishments of the 4th Court, Haw Par Villa, Singapore
Being pounded by a stone mallet, and grounded into pulp

I won't spoil all the fun by telling you all the Crimes and Punishments in a Chinese Hell. Let's have fun finding out when you're in Haw Par Villa (or when we're down there). After all, the journey of discovery is half the fun.

Are these very graphic depictions R-rated? Would only adults be allowed in here? It would defeat the purpose, according to the creator, who wanted to scare kids stiff. I know you Catholic boys and girls can relate to all these? I don't mean Chinese Hell, they have their equally colourful Hell.

I've been here a few times (yeah, I've morbid taste), I often seen local parents who brought their young kids to see these. They would point out casually or matter-of-factly to their kids, "you see, this guy's tongue got pulled out because he's making everyone in the family miserable". Y'all hear that, kids? It says nothing about playing with matches, so gets crazy with it.

Tongue being pulled out as a punishment in the 7th Court, Haw Par Villa, Singapore
Tongue being pulled out

Having said that, few locals visit this place. I've never seen more than 50 people there any one time, and it isn't a small place and it's free admission. They used to charge expensive fares, the Singapore Tourism Board stop charging fees since 1998.

The place was created to teach traditional Chinese values. It isn't hard to see that these traditional thinking are out-of-date. This isn't surprising when you considered that this place was conceived back in the 1930s.

Few Chinese-speaking Singaporean still subscribe to the all-important Chinese value of filial piety (I bet most English readers don't even know the term). Actually there're less Singaporean Mandarin speakers than foreigners think, and even fewer Chinese readers. It often puts a smile on my face when Western expats ask if they need to learn Mandarin if they're going to live and work in Singapore. Most Singaporean are multilingual, with English literacy the highest among them comparing to the other 3 official languages. So my advice to the European expats, if you thinking of working in Singapore, learn English!

I've little chance in brushing up my Mandarin in Singapore, I get only 20% of the time in using Mandarin because I insist. I could very well have used English 100% of the time.

Too bad, I say, they really have little chance of using - hence learning - Mandarin in their everyday lives (although their kids can), This is why the high-profile billionaire investor Jim Rogers wants to live in Singapore. He still can't speak Mandarin after living in Singapore all these years, but his daughters can. In fact, one of his daughter speaks Mandarin better than just about all Singaporean as she won nationwide Mandarin-speaking contest 2 years in a row. See what I mean? A foreigner can speak Mandarin better than the locals.

Having said what I said about Singaporean's Mandarin literacy. For the educated middle-class Singaporean baby-boomers, their Mandarin literacy is lower than the current generation for the precisely same reason why Jim Rogers can't speak Chinese while his daughters can: the emergence of China in the last 3 decades. Note that I'm very careful in using the word "Mandarin", and not "Chinese" in this and the last 2 paragraphs. Chinese speaking doesn't always equate to Mandarin speaking.

One of the stories of the 24 Paragons of filial piety, Haw Par Villa, Singapore
One of the stories of the 24 Paragons of filial piety

This diorama shows one of the very dated classic stories of the 24 Paragons or Exemplars of Filial Piety. The story of She Breastfed Her Mother-In-Law. So the daughter-in-law puts her mother-in-law above her child (as far as her breast milk is concerned). Today such thing only appear in the Jerry Springer Show.

Drinking of tea to wipe the memories of the previous life
Granny Meng is standing in the Pavilion in yellow robe

There's light at the end of the the tunnel shaped Ten Courts of Hell. After the deserved punishment, the soul is given the Tea of Forgetfulness (迷魂湯) to drink from an old lady called Meng Po or Granny Meng. Afterwards, he or she will forget everything in his or her life, and ready for the next life with a clean slate (who wants to remember all that torture?) The tea works far better than and much cheaper than that electronic gadget in Men in Black. Some people didn't drink and so they remember their previous lives.

After the tea, one's soul is sent away to be reborn and the cycles begins again.  Yep, there's a happy ending.

If you aren't religious, you could see the whole hellish thing as a metaphor for dream. Those tortures are the nightmares that haunt your conscience. You wake up, and the dreams are fading away, and another day starts anew.

Life is but an endless cycles of all different time frames: some are measured in seconds, other in decades, and ultimately in our whole life times.

Six paths to the Wheel of Reincarnation or Samsara
Six paths to the Wheel of Reincarnation or Samsara
Note that the 6 paths contain people as well as animals

 Monkey Around on the Way to the West 
Of course, you can't introduce visitors to Chinese culture without showing the Monkey, or his other names, Monkey King, Monkey God, the Great Sage Equal of Heaven or Sun Wukong (孫悟空). But one section isn't doing justice for him, so there're 2 sections built to illustrate his illustrious life. One section depicts the scene from the Chinese classic Journey to the West where he accompanies his master Tang Sanzhuang in the trek or odyssey to India, and the other depicts his life in Mount Huaguo (花果山 or Flowers and Fruit Mountain).

A scene from Journey to the West of Sun Wukong fighting Red Boy, Haw Par Villa, Singapore
A scene from Journey to the West of Sun Wukong fighting Red Boy (紅孩兒)
Red Boy also known as Boy Sage King (聖嬰大王)

Monkey King rules over his domain atop Mount Huagou, Haw Par Villa, Singapore
Monkey King rules over his Simian domain atop Mount Huagou

With the few visitors and no entrance fees, I was concerning that this place won't last long. But it appears that not only most of the dioramas and sculptures are looked in good condition. In fact, I saw that worker was doing maintenance work on the exhibits.

The modern Singaporean would find the traditional Chinese cultural values too old-fashion, but for the old-fashion, the many provocative statues here would make them blushed. Maybe the sculptor was trained in Prague? These 2 conflicting signals seem anachronistic and oxymoronic. What were the park creator thinking? These contradictions make this place unique and I found myself irresistibly drawn to it like malware worm to ebook. Crunch, crunch, yummy in my tummy.

It's great to see this unique past preserved. This is an extinct museum, the last of its kind. I hate to see it go.

How long do you need to spend in this park? It depends. If you want to take photos of every statue, and pore over them with a microscope like me, you need no more than 4 hours. If you just come and have a casual look, you don't need more than 2 hours (or less). If you take your 8 year-old child and need to frighten them with traditional moral tales in R-rated graphic dioramas, it probably takes a bit longer.

If you like to feast your eyes with a colourful, shocking, eclectic collection of the exotic, bewildering, imaginative by-gone traditional Chinese cultural images, this is a must-see.

For those who are interested a great deal about Chinese Hell (or Hell in general) like myself could read more about it on my article about my hellish encounter with loan $hark.

Thursday, 10 July 2014

Singapore Hungry Ghost Festival 2014

Hell Gate Open Day. Ghost on Parole.

When I first arrived in Singapore, I was curious about the rusty bins scatter around Singapore. They don't look like garbage bins. I peeked inside and saw no garbage, except a metal grille and some ashes. I was mystified.

The Festival of Hungry Ghosts had crept up on me like a creepy ghost... It's only today that I started to see scattered rusty bins with plumes of rising smokes appeared on street curbs outside some shops. Nearby are the food offering accompanied by candles and incense. When I got back to my HBD flats, a few of such food offerings and joss-paper burnings also have been taken place.

I suspected that this is the start of the Festival of Hungry Ghost, but just to be sure, I looked up the Lunar calendar online (I don't even own a calendar). My suspicion was confirmed - today is the 1st day of the 7th month of the Lunar calendar (probably better think of it as Chinese Calendar because this is strictly a lunisolar calendar. But then since it's used by not just Chinese, maybe it's best to call it Asian Calendar. But then since Asia include part of ME, which uses a Muslim calendar, ah...I give up).

Officially, this Ghost Festival is on 15th day of the 7th lunar month. But the Singaporean 'celebrate' it the whole of 7th moon. 'Appeasement' is a better word than 'celebration'. The ghosts are actually prisoners and were simply given a month long break from Hell, which the Chinese word is "Di Yu" 地獄, the literal translation is Earth Prison (Earth refers to 'in' earth, not 'on' earth. The more meaningful translation would be Underworld Prison). As we know in prison, meals are rationed in small portion, hence it explains the hunger.

All this brings back very warm and fuzzy nostalgia from my well-spent childhood in Cholon ('Chinatown' in Ho-Chi-Minh City). For some odd reasons, I had never been freaked out by this Ghostly business as a kid. I suspected nobody took the trouble to illuminate me the dark side of this Festival. There are several similarities and differences between my memories (just under 30 years old) and the modern day Singaporean one. In Cholon, only Hokkien Opera was performed (for the appeasement/entertainment of the ghosts) during the Festival, no modern songs and musicians were performed. Maybe Singapore also didn't have these modern performances, but was added later on. Maybe some old Singaporean who read this blog can tell me if this is true. Another very interesting ritual that intricate part of the festival yet missing from Singapore today is the throwing of coins. I remembered my mum would be holding a large canvas bag of coins. After all the rituals of food offering and joss-paper burning was done, the last thing was the throwing of the coins into the streets. Kids that already swarmed around waiting for this coin-throwing. When the shower of coins hit the ground, the kids would be scurrying, hopping onto the pavement like frogs on summer nights. It was an incredible scene of chaos and mayhem. And when one coin-throwing is done, the throng of kids swarmed to the next one like locusts moved onto fresh crops. Yeah..i was one of those locusts (more like a grasshopper). The noise, the smell of sweat, the hustle and bustle were all quite amazing and unforgettable. There would five to six such occurrences in our block. The coins I collected bought me a tendon beef ball noodle soup (I drool just thinking about it), and a movie in a cinema - a great day-out. One year, the crowd was so rough that my clothes was torn. Another year, I came home with a bloody nose. Good time! Some of these kids were neighbouring boys, others are beggars. Maybe Singapore had something like that too 30 years ago, but was understandably outlawed. One can imagine the chaos such events would cause to the traffic. Again, maybe some old Singaporean who read this blog can tell me if this is true. I wonder if this ritual still takes place in Vietnam today. I suspect not. If there are still Chinese remain in Vietnam, that is.


The ritual materials on this rack sold by 7-Eleven store just across from where we live. They include all essentials like joss papers (Hell's banknotes or money), joss sticks, candles, etc for a good burn offering to the departed. The stock on this rack is going to sell fast for the rest of this lunar month.


This is a pile of joss paper or hell's banknotes, probably amount to millions (even billions), being burnt to offer to the poor souls (now becomes moderately rich). What would they need money in Di Yu? Buying cigarettes I imagine (or anything they fancy). Of course, some would simply burn the actual objects like cars and houses for the departed, thus saving them for the shopping trips. Cash is king even down there and the spirits can buy whatever they please. How do you know what kinda cars they want - a sexy convertible, a luxurious stretched limo or trendy hummer? Or what kinda houses - posh mansion, cozy cottage, hell-gate front property? Cash is not only king, it's democracy. So burn them some dead presidents.

Some people said that this Hungry Ghost Festival is a Chinese Halloween. Two major differences. One, this is a whole month event. Two, much more importantly, Halloween in the West is an excuse for people to party and for business to capitalise on it. Westerners don't really believe in it, nor buy it (the ghost story, not the costumes). I suspect most would only remember the ritual but not the real meaning of Halloween. The Chinese in SE Asia actually believe this hellish story. They are deadly serious (pun intended). Ironically, China, the country where this Festival originated doesn't 'celebrate' it. Another irony is that almost in every way, Singaporean Chinese are more sophisticated and 'progressive' than mainland Chinese, but this superstition (and surprisingly many other) lives on in Singapore. This is because the so-called Marxist Scientific Socialist Revolution in China discouraged superstition and outlawed religion. How do you outlaw superstition though? After the open-door and reform policy in 1978, things have been different in China. HK people also are as sophistical superstitious as Singaporean because they too were given the freedom to believe anything...just like the Freedom of Speech, you have the right to talk nonsense, it's in the Constitution.

El Día de los Muertos Festival in Mexico is probably is closer comparison. Deepavali is an Indian festival that is also celebrated in Singapore. Oil lamps are placed on the ground to guide the departed spirits as they are descended from heaven not unlike the two rows of lights on the airport runway to guide them in the planes' touch down. I can visualise the spirits coming down with their arms spreading out like wings. This is clear evidence that the ancient Indians already had a correct basic design of an aiport. The main difference between Deepavali and Hungry Ghosts festival is the place of origin where the departed are coming from while their destination is the same: earth. In both cases, the earth is their favourite destination. I wonder why...

When the Chinese Communist Party during the Mao Era outlawed religious practice, people's thirst to worship had to be satisfied in another way. Communism filled the void left by Budhism, and Taoism. The Communist propaganda department wasted no time in creating a Mao's personality cult that modelled on previous religions (whether the propagandists knew it ot not). Instead of effigies and statues of deities, photos and memorabilia of Mao enjoyed ubiquitous existence. Mao's Little Red Book substituted the Buddhist Diamond Sutra/Bible, and Mao's suit is the new saffron robe/habit. People sung the lyrics of East is Red, and entranced by its dances (I, too, was mesmerised by this song during my adolescence in Vietnam, swept away by its power. Well, I was only a boy. Ok...I am still enjoying the song. I'm only human. It's easier to sell anything with a song, just ask the Coca Cola marketing department. Life is it!). The colour red is Chinese cultural festive colour, and now the Communist colour. Even the theme colour matches (coincidentally the colour of Coca Cola, not trying to connect any dots here). This saved the propaganda machine a lot of elbow grease. Mao himself became the embodiment of the very thing he tried to ban - a religious figurehead.

Guess Why Chinese dominates the game of table tennis? Sure they also dominate a few other sports like badminton, diving, gymnastics, weightlifting (recently), etc, but none is even remotely matched its dominance in table tennis. To give you an idea, there are about 30 or so countries that have Chinese pingpong players representing these countries at the national level. They emigrated to play in another country because China is swamped with top players who simply can't break into the Chinese national team. So they try their luck with other countries. Especially European countries where this game is popular and many Chinese players successfully broke into their national teams. If some day when another country beat Chinese in table tennis, it's quite possible that it might just be another Chinese (representing, say, Singapore - Feng Tianwei who ranks number 5 in the women's category according to ITTF in 2009. The rest of 1 through 7 are PRC players).

The reason for this Chinese national obsession? Chairman Mao just so happened to be a keen player of table tennis. Monkeys see monkeys do (Actually Mao isn't alone, several other Communist founding fathers also played it, not that anyone knows or cares). This popularity led to famous Ping-pong Diplomacy in the 1970's with USA. Despite this, USA has yet to produce a great pingpong player as the game has never caught on in the US, except for Forrest Gump who gets most of his energy and inspiration from a box of chocolates (Me, I prefer cappuccino. Ah, life is like a cup of cappuccino, it's all frothy at the surface, and the real substance lies underneath).
If Mao had chosen to play golf, Chinese would produce the best golfers today (actually they are getting better). But I can't imagine Mao would pick up the (golf) club of the Western decadent bourgeois sport. It was in fact outlawed for that reason. If there was Chinese Idol TV program in China while Mao was in power, many testosterone filled, adrenaline rushed youngsters would get an outlet for their idol worshipping - a safety valve to relieve the pent up demand for this basic drive. Judging by the Cultural Revolution, the impressionable youth is the ones that struck under the spell of Mao Mania the deepest and were perfect to be mobilised to this political rousing.

In the West all kinds of idol worships were available for the citizen to shop around: religious leaders, musicians(Kenny G, Ozzy Osbourne), rockers(Ozzy Osbourne), actors(Hank Azzaria), athletes(Ben Bickham), writers(Jackie Collins), TV celebrities (Opra, Ozzy Osbourne), billionaires(Warren Buffet), reality TV show personalities (guess who?), radio announcer, beauty pageants, cult leaders, Playboy models, reality TV participants, ad nausea. Just about anyone can be the object of adulation, icon of idolisation. Individuality and freedom at its extreme/highest/purist form. Mao was the outcome of all that worship energies a billions strong channel into one outlet. Zap! 5 millions volts of power plugged in! This is a very simple economics equation: demand for idol worship is the same for all of countries, but in the West there are idol/hero worships galore, in China, an overwealming undersupply.

After the Open-Door and Reform policy in the post-Mao Era since 1978, as the Door of China is swung open to the world, the Chinese kids have found idols in all other places, even a blondie like the primatologist/anthropologist/greenie Jane Goodall - an all round good gal (her name says all). Her global program Roots and Shoots where Chinese kids belong can now look up to a caring person and mending the earth at the same time (instead of tearing the country apart like their crazed elders).

After Mao's death, religious practises are bouncing back on the trampoline of the reform policy, as are most of the old traditions and cultural values that Chinese Communist Party detested and vouched to quash during the Mao Era, especially during the heyday craze of Cultural Revolution when temples were ransacked, religious idols smashed, anything traditional destroyed. Many ideas resurrected after Mao's death. Confucianism, for example, which was considered an outdated feudal value system is now snapping back and slap your face flush red in a big way. Chinese Communist Party plans to install 500 Confucius Institutes 孔子学院 worldwide (300 down, another 200 to go). The Institute even reaches the virtual world of Second Life where virtual avatars can learn about ancient philosophy between bouts of virtual sex with strangers. If the Chinese Communist Party embraced the very antithesis of Capitalism into the New China, surely religion, and Confucianism can also be thrown into this healthy mix of smoothie that is post-Mao China. Yummy tummy! Feed me more smoothie! Before the Fall of Berlin Wall, the Commies renounced their pasts, tried to replace their ancient civilisation by re-inventing a whole Brave New World of communist cultures expressed in their red songs, dances, sculptures, uniforms and the most visible and concrete of all - architectures (which to me resembles art deco style) that created by the Northern neighbour Ruskies. In short, it was a country that are ashamed of its past and wanted to deny it (much like one of my brother). Communism didn't live very long. Its inventor USSR has fallen, and China is still keeping a piece of crumbling relics and placed on the altar of the Party.

Actually, what China practises today isn't so much Marxism, or Communism, or Socialism, or even Capitalism, or Confucianism, or Taoism, but the most practical 'ideology' of all - Pragmatism (aka Whatever-Works-Ism) - unleashed by uncle Deng with the black cat/white cat variety so that China is eventually free of rats infestation[1]. Finally Chinese people are drinking the cappuccino caffeine, and not the milky froth above it.

I have a feeling that China would probably get rid of the relic eventually, not through an abrupt crumbling of the Berlin type of revolution with a sudden collapse of government, but a turtle-paced evolutionary type of constant tweaking through reforms, which China is witnessing in the last 3 decades since the Door of China was swung open by uncle Deng (actually it was only ajar at first with his head peeked out, but the iron-laced bamboo door is open wider and wider as time goes by). Actually this turtle moves at a soaring dragon speed, but compare to a metamorphosis over night, it's a sort of fast-paced catalytic evolution - the catalyst being an external influence. So what's the hurry? China had been left so far behind because of all the dilly-dallying with the Slow Dance with Mao while it's nice and fun, the unsightly after party mess had to be cleaned up (they won't see the mess while they were swept off their feet with his charisma as their collective swoon heads rest comfortably on his and powerful, broad shoulder like nothing in the world to care while the slow romantic music filled the country, not even hunger and a little thing called freedom). It's time to play catch up with the rest of the world, much more importantly, to stave off starvation of the millions, and lift some into the higher echelon of middle and upper classes. Yes siree Bob, the socialist classless society is turning on its head while Mao is turning on its grave (and I'm turning a frown into a smile). They were forced to stop dreaming, woken up by the loud, concerted kerching of millions of cash registers. You can't dream when you're starving because there's no sugar going to the head to fire those little sugar suckers called neurons. Keep your stomach full, then day dream, not the other way round, which was happened in the first 30 years of PRC from 1949. Who knows? Maybe dreaming kept them forget about their hunger.

It's quite amazing that within a span of little more than 0.5 of century, China went from the Qing Dynasty who took on themselves the role of safeguarding and keeping one of the oldest civilisation alive, to Red China, whose shedding of old baggage knows no bounds. Nothing was too new to these PRC comrades to embrace, and nothing are too old to get rid of. Don't think any country undergo such cataclysmic changes in such a short time. Another first for China, I supposed.

These days, she's getting something old (from China), something new, something borrowed (from the West), something red (from the Party), and marry all these together, and you get the New China - a union made in heaven, a cause for celebration. Of course, one needs to be reminded that marriage is a work-In-Progress (WIP), not Rest-In-Peace (RIP), and put your feet up and hope for the best. Especially an arranged marriage.

Back to the brighter and lighter subjects of ghosts and demons. Not only different cultures around the world have their ways to deal with ghosts that personify their inner demons, but ghosts manifest in various masks in different stage of our life. Kids are freaked out by ghosts that embody the instinctual fear of the unknowns, the strange, the strangers, the dark, but the aged are comforted by ghosts that exemplify hope for survival instinct of what lies beyond death, the continued existence of our soul. But our biology don't make lies easy for us, it hands us an over-active imagine in youth to fuel those fear, and the critical faculty in mature years to temper those hope. It would be great if things were reverse. This so typically of us - kids want to be grown-up, and the old wish they were youngsters. The grass-is-always-greener-on-the-other-fence symptom.

Atta's colleague told her today that she should be careful not to stand in front of the candles and food offering as hungry ghosts are wolfing down those food and you would be in the way. Especially candles, which supposed to be energy bars for ghosts. She was quite serious. I think this is crazy talk. When you are sitting down on a bench, you could be sitting on top of a ghost that enjoy the wafting aroma of the burning incense, and when I lay down in my bed tonight, I might be laying on top of a conjugal couple of ghosts taking advantage of my soft yet firm mattress. I'm just saying.

Good night!
[1]during the Vietnam War, the South Vietnamese government call the Vietcong "Rats" (not Reds) because they hid in the tropical jungles and emerged time and again to conduct guerrilla warfare. Ironically, the while the South didn't even know about the Cui Chi Tunnels where the commies hid underground like rats under their very noses.