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November 2013

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Bitcoin Is Making My Leg Tingle!


Remember when a certain propaganda pusher on MSNBC stated that Obama made him feel a tingling sensation run up his leg?  Thinking about the meteoric recent rise in Bitcoin exchange rates is causing me to have that sensation right now.  I'm not joking, and don't think I'm having a stroke.  It's just a manifestation of joy.  And I don't even own any Bitcoin, lacking the capital, time and spouse's permission to speculate in this medium.

I'm happy about the rise because it seems that a lot of the early and present holders of Bitcoin share certain of my beliefs about the superiority of voluntary institutions to coercive ones.  Hopefully, peace-loving people are going to be the prime beneficiaries of a speculative boom, instead of the military-industrial complex.  It's exciting to think about what all these peace-loving and creative people are going to do with their speculatively acquired purchasing power.  Some significant portion of them are going to divert economic resources into promoting development of voluntary society, and dis-empowering coercive institutions, even if only by living more independently of the state and spending their lives in more worthy endeavors than being tax slaves.  It's all good.  Hence the tingling.

All of this joy doesn't mean that I can't recognize a speculative bubble when I see one.  And Bitcoin is definitely experiencing a bubble right now.  Or so its price chart is screaming.  How high it will go, when it will crash, and at what price it will stabilize after the inevitable crash, nobody knows.  But holders of Bitcoin would do well not to ignore the classic signs of tulip-mania.

Bitcoin is unlikely to afford its holders the luxury of days or weeks to unload their coin after a top is established.   The market is still too thinly traded for that.  The available time will likely be measured in minutes or hours, and it may be impossible to find any buyers at a price you expect, if the price drops rapidly enough.  It's no fun being a seller trying to unload into a diving market.  To avoid being stuck holding all of the bag, anyone who has already realized significant profits by holding Bitcoin should have a plan to begin taking profits out now.  Not all profits, but some.  If you have already made large gains, take some percentage of your profits.  Say, 20% now.  And an additional percentage at regular intervals, if the price keeps going up.

Let's see how this works with an example:
Initial investment $10,000 to buy 100 Bitcoin at $100 each.
Bitcoin price at $1000: Coins held worth $100,000, sell 20, cashing out $20,000, 80 left.
Bitcoin price at $1300: Coins still held worth $104,000, sell 10, cashing out $13,000, 70 left
Bitcoin price at $1690: Coins still held worth $118,300, sell 8, cashing out $13,520, 62 left
Bitcoin price at $2,200: Coins still held worth $136,400, sell 6, cashing out $$13,200, 56 left.

You get the idea.  Take out a constant dollar amount every time the price rises 30% (more the first time because of the 10,000% price increase already experienced in this example).  You can adjust this strategy to suit your preferences.  The basic idea is that if the price keeps going up, your investment continues to grow in value.  If there is a sudden crash after a period of growth, chances are you will already have recovered your initial investment with a tidy profit. 

After selling your coin, you don't need to hold FRNs.  There are plenty of other assets you can hold instead; I recommend diversifying your holdings. Whatever you do, don't just buy and hold Bitcoin.  The market will likely punish you severely.  Bulls make money, bears make money, but pigs get slaughtered. 

Be prepared for the beginning of a prolonged downturn at any moment.  Use a technical analysis method to tell you when to sell, such as a crossover of a short-term average over a long-term average.  There are many proven methods; just pick one simple method and stick with it.  The primary benefit of technical analysis  is to take the emotion and mysticism out of trading decisions; there's nothing magically predictive about such methods.  All rational technical analysis methods will require that you endure a significant loss, for example 10-20%, before selling to avoid being "whipsawed" by market "head fakes."   It is impossible to perfectly time any market, except by pure random luck.

Suppose, for example, after reaching $2200 the market drops to $1760 (-20%) with no sign of stopping and your technical sell signal is triggered.  At that point, you must sell all of your remaining coin, receiving $98,560 for the sale.  Do not waver; just tell yourself you'll quickly buy back in if the price goes back above its high of $2200, which would be a strong signal that the downturn is over (or use whatever other technical buy signal you prefer).    Plus the prior sales, at that point you will have realized $158,280, or a profit of $148,280 on the initial investment of $10,000.  A stellar return.

You can then wait until the price stabilizes and starts to head back up before buying back in, if you want to continue to speculate.  A good strategy is to use a technical buy signal and start buying over time once the signal is generated.  For example, buy 10 Bitcoin per week until you own as many as you care to, once the technical signal is generated.  Hold for a while, and repeat as necessary if a second bubble emerges.

If you're out, should you get in now?  It's impossible to know, because no one knows how long the upward market pressure will continue.  But if you do just start getting in now -- and by "getting in" I mean buying more than you need for your normal business needs i.e. speculating -- don't do so without recognizing the risk, and having a trading strategy that will get you out in time.  Just because you believe like many others that Bitcoin has a bright future does not mean the price can't crash.  There are few examples of meteoric price explosions in any market not followed by a crash.  In fact, I can't think of any.  Bubbles are a market phenomenon largely unconnected to the virtues of the commodity being traded.  No one is being forced to buy or sell Bitcoin, so a market certainly exists and will behave as all markets do.

I'm not a licensed or qualified investment adviser, so take the above as just friendly and free talk around the libertarian water cooler for inexperienced traders who already invested in Bitcoin and are wondering what to do next.  The babble is worth no more than what you have paid for it, and all warranties are disclaimed except that it is given with good intentions by an amateur student of trading strategies.  Fare well.

Bitcoin Is Making My Leg Tingle!


Remember when a certain propaganda pusher on MSNBC stated that Obama made him feel a tingling sensation run up his leg?  Thinking about the meteoric recent rise in Bitcoin exchange rates is causing me to have that sensation right now.  I'm not joking, and don't think I'm having a stroke.  It's just a manifestation of joy.  And I don't even own any Bitcoin, lacking the capital, time and spouse's permission to speculate in this medium.

I'm happy about the rise because it seems that a lot of the early and present holders of Bitcoin share certain of my beliefs about the superiority of voluntary institutions to coercive ones.  Hopefully, peace-loving people are going to be the prime beneficiaries of a speculative boom, instead of the military-industrial complex.  It's exciting to think about what all these peace-loving and creative people are going to do with their speculatively acquired purchasing power.  Some significant portion of them are going to divert economic resources into promoting development of voluntary society, and dis-empowering coercive institutions, even if only by living more independently of the state and spending their lives in more worthy endeavors than being tax slaves.  It's all good.  Hence the tingling.

All of this joy doesn't mean that I can't recognize a speculative bubble when I see one.  And Bitcoin is definitely experiencing a bubble right now.  Or so its price chart is screaming.  How high it will go, when it will crash, and at what price it will stabilize after the inevitable crash, nobody knows.  But holders of Bitcoin would do well not to ignore the classic signs of tulip-mania.

Bitcoin is unlikely to afford its holders the luxury of days or weeks to unload their coin after a top is established.   The market is still too thinly traded for that.  The available time will likely be measured in minutes or hours, and it may be impossible to find any buyers at a price you expect, if the price drops rapidly enough.  It's no fun being a seller trying to unload into a diving market.  To avoid being stuck holding all of the bag, anyone who has already realized significant profits by holding Bitcoin should have a plan to begin taking profits out now.  Not all profits, but some.  If you have already made large gains, take some percentage of your profits.  Say, 20% now.  And an additional percentage at regular intervals, if the price keeps going up.

Let's see how this works with an example:
Initial investment $10,000 to buy 100 Bitcoin at $100 each.
Bitcoin price at $1000: Coins held worth $100,000, sell 20, cashing out $20,000, 80 left.
Bitcoin price at $1300: Coins still held worth $104,000, sell 10, cashing out $13,000, 70 left
Bitcoin price at $1690: Coins still held worth $118,300, sell 8, cashing out $13,520, 62 left
Bitcoin price at $2,200: Coins still held worth $136,400, sell 6, cashing out $$13,200, 56 left.

You get the idea.  Take out a constant dollar amount every time the price rises 30% (more the first time because of the 10,000% price increase already experienced in this example).  You can adjust this strategy to suit your preferences.  The basic idea is that if the price keeps going up, your investment continues to grow in value.  If there is a sudden crash after a period of growth, chances are you will already have recovered your initial investment with a tidy profit. 

After selling your coin, you don't need to hold FRNs.  There are plenty of other assets you can hold instead; I recommend diversifying your holdings. Whatever you do, don't just buy and hold Bitcoin.  The market will likely punish you severely.  Bulls make money, bears make money, but pigs get slaughtered. 

Be prepared for the beginning of a prolonged downturn at any moment.  Use a technical analysis method to tell you when to sell, such as a crossover of a short-term average over a long-term average.  There are many proven methods; just pick one simple method and stick with it.  The primary benefit of technical analysis  is to take the emotion and mysticism out of trading decisions; there's nothing magically predictive about such methods.  All rational technical analysis methods will require that you endure a significant loss, for example 10-20%, before selling to avoid being "whipsawed" by market "head fakes."   It is impossible to perfectly time any market, except by pure random luck.

Suppose, for example, after reaching $2200 the market drops to $1760 (-20%) with no sign of stopping and your technical sell signal is triggered.  At that point, you must sell all of your remaining coin, receiving $98,560 for the sale.  Do not waver; just tell yourself you'll quickly buy back in if the price goes back above its high of $2200, which would be a strong signal that the downturn is over (or use whatever other technical buy signal you prefer).    Plus the prior sales, at that point you will have realized $158,280, or a profit of $148,280 on the initial investment of $10,000.  A stellar return.

You can then wait until the price stabilizes and starts to head back up before buying back in, if you want to continue to speculate.  A good strategy is to use a technical buy signal and start buying over time once the signal is generated.  For example, buy 10 Bitcoin per week until you own as many as you care to, once the technical signal is generated.  Hold for a while, and repeat as necessary if a second bubble emerges.

If you're out, should you get in now?  It's impossible to know, because no one knows how long the upward market pressure will continue.  But if you do just start getting in now -- and by "getting in" I mean buying more than you need for your normal business needs i.e. speculating -- don't do so without recognizing the risk, and having a trading strategy that will get you out in time.  Just because you believe like many others that Bitcoin has a bright future does not mean the price can't crash.  There are few examples of meteoric price explosions in any market not followed by a crash.  In fact, I can't think of any.  Bubbles are a market phenomenon largely unconnected to the virtues of the commodity being traded.  No one is being forced to buy or sell Bitcoin, so a market certainly exists and will behave as all markets do.

I'm not a licensed or qualified investment adviser, so take the above as just friendly and free talk around the libertarian water cooler for inexperienced traders who already invested in Bitcoin and are wondering what to do next.  The babble is worth no more than what you have paid for it, and all warranties are disclaimed except that it is given with good intentions by an amateur student of trading strategies.  Fare well.

BitCoin: the WWW of the Decade?


To Mark Twain is attributed the saying ""History does not repeat itself, but it does rhyme."  Spotting those rhymes is perhaps a meaningless endeavor best reserved for idle poets, but I can't stop myself from noticing.

The central bankers' continued acquiescence and developing regulation of BitCoin, recent media attention, and booming exchange price, are reminiscent of the World Wide Web in the early 1990's.  The Web broke into the public consciousness around 1993 or so, and sparked a stock market boom and bubble that lasted the better part of the decade.  It was going to change everything.  Some thought it would make us all more free and prosperous.

To a certain extent it has.  For the wisest and most motivated, the Internet and related technology can enable a great deal of economic independence and freedom.  But for the average person, arguably it has not lead to greater prosperity, but has enabled corporate and government interests to collect and retain incalculably greater amounts of personal information in ever-expanding areas of life.  Networks have become adept tools for mass surveillance.  On balance, the expansion of communication networks has created a greater threat to personal privacy and freedom than ever seen before.

It appears that a similar scenario is playing out with BitCoin.  I'm not advising anybody to get in or get out, but just be aware of the historical parallel.  It may be that BitCoin or something like it (perhaps a replacement coin that better facilitates credit expansion by banks) may one day become either compulsory, or the only practical currency for most transactions.  If this happens, in an absence of social change on the order of the Second Coming, it will be because the central bankers allow it to happen and are the principle beneficiaries.  For most people, it will not lead to an increase in freedom, but to a surer captivity.  Imagine a world without any generally accepted currency or cash (no paper bills or coins) except for trackable electronic certificates, with every account tied to a personal or corporate identity through a coercive registration system backed by tireless robots sniffing through computer networks.  The wisest may (or may not) escape slavery in this sort of system, but the vast majority of ordinary people will be unable to escape to any meaningful degree.

The remainder of this post after the present paragraph is lifted word-for-word from an anonymous comment at Robert Wenzel's Economic Policy Journal blog.  I'm repeating it here in this much more obscure journal "for the record," so to speak, without endorsement or criticism.  DARPA is publicly acknowledged as the developer of the Internet; so far as I know nobody has publicly taken credit for BitCoin.  Nonetheless speculation that the origins of BitCoin are shrouded in secrecy not because BitCoin is too subversive of the current order, but because it is being promoted by that order, are not totally implausible. 

"NSA/DARPA created bitcoin under the guidance of the IMF. The IMF has been openly calling for a digital, one-world, deflationary currency for 2 decades. OPENLY. It has been discussed and promoted OPENLY at G8 and G20 summits.from the early 90s-96 the NSA was OPENLY investigating cryptographic money networks.

One of their researchers and investigators is a man named Tatsuaki Okamoto. When they actively started writing the code they chose the pseudonym "Satoshi Nakamura" to ultimately promote the idea that Tatsuaki Okamoto to any and all who investigated the source of bitcoin long enough. But Tatsuaki Okamoto is just a cog. He's not some rogue savoir out to topple centralized banks. Not at all. He is a crypto scientist who was paid by government and intelligence agencies to do research.

Bitcoin is an NSA/DARPA lab set into the wild. Scientific technology grants issued by government and intelligence agencies are how these labs are funded and promoted. The regulation and control of bitcoin has been actively developed alongside the development of the network. In fact, the controls, policy and regulation are WAY WAY more mature than the bitcoin protocol itself. That's why we see things like Greenlist written into law without a mention of bitcoin until recently.

This is not tinfoil hattish. This is just reality. No one forced ANYONE to believe the Satoshi fairytale.. The libertarian Satoshi myth has been promoted in stealth to specifically promote ADOPTION and DEVELOPMENT. It's no different than the internet and WWW itself. EXACTLY the same. That is why you see many www early adopters saying bitcoin "feels" the same as the early internet. I am one of those people.

In 94-96 the public internet was ALL about freedom of information. FREE COMMUNICATION. It was ALL about liberty and freedom. I wish i could transport some of you back in time so you could see for yourselves. The promise of free phonecalls with the freeworlddialup, free media with IUMA and the MBONE. All this freedom and liberty had people pouring their heart and soul into developing it. Now look at it. Facebook, google.. it is a GIANT SURVEILLANCE grid. And if you look for and read DARPA/NSA docs from the 80s and early 90s that was what it was always meant to be. I am not discounting all the socially great things that happen online.. But from the perspective of DARPA/NSA and control freaks.. it was created for the express purpose of control. A military purpose. A strategic purpose.

What is bitcoin? Bitcoin IS the one world digital currency. We all have a deterministic UUID that has been generated from our biometric data. This UUID will be related to all your datastores. This UUID is your mark. This UUID is what is used to buy and sell online and in the real world. This UUID is the primary key in your Greenlist identity.
"

BitCoin: the WWW of the Decade?


To Mark Twain is attributed the saying ""History does not repeat itself, but it does rhyme."  Spotting those rhymes is perhaps a meaningless endeavor best reserved for idle poets, but I can't stop myself from noticing.

The central bankers' continued acquiescence and developing regulation of BitCoin, recent media attention, and booming exchange price, are reminiscent of the World Wide Web in the early 1990's.  The Web broke into the public consciousness around 1993 or so, and sparked a stock market boom and bubble that lasted the better part of the decade.  It was going to change everything.  Some thought it would make us all more free and prosperous.

To a certain extent it has.  For the wisest and most motivated, the Internet and related technology can enable a great deal of economic independence and freedom.  But for the average person, arguably it has not lead to greater prosperity, but has enabled corporate and government interests to collect and retain incalculably greater amounts of personal information in ever-expanding areas of life.  Networks have become adept tools for mass surveillance.  On balance, the expansion of communication networks has created a greater threat to personal privacy and freedom than ever seen before.

It appears that a similar scenario is playing out with BitCoin.  I'm not advising anybody to get in or get out, but just be aware of the historical parallel.  It may be that BitCoin or something like it (perhaps a replacement coin that better facilitates credit expansion by banks) may one day become either compulsory, or the only practical currency for most transactions.  If this happens, in an absence of social change on the order of the Second Coming, it will be because the central bankers allow it to happen and are the principle beneficiaries.  For most people, it will not lead to an increase in freedom, but to a surer captivity.  Imagine a world without any generally accepted currency or cash (no paper bills or coins) except for trackable electronic certificates, with every account tied to a personal or corporate identity through a coercive registration system backed by tireless robots sniffing through computer networks.  The wisest may (or may not) escape slavery in this sort of system, but the vast majority of ordinary people will be unable to escape to any meaningful degree.

The remainder of this post after the present paragraph is lifted word-for-word from an anonymous comment at Robert Wenzel's Economic Policy Journal blog.  I'm repeating it here in this much more obscure journal "for the record," so to speak, without endorsement or criticism.  DARPA is publicly acknowledged as the developer of the Internet; so far as I know nobody has publicly taken credit for BitCoin.  Nonetheless speculation that the origins of BitCoin are shrouded in secrecy not because BitCoin is too subversive of the current order, but because it is being promoted by that order, are not totally implausible. 

"NSA/DARPA created bitcoin under the guidance of the IMF. The IMF has been openly calling for a digital, one-world, deflationary currency for 2 decades. OPENLY. It has been discussed and promoted OPENLY at G8 and G20 summits.from the early 90s-96 the NSA was OPENLY investigating cryptographic money networks.

One of their researchers and investigators is a man named Tatsuaki Okamoto. When they actively started writing the code they chose the pseudonym "Satoshi Nakamura" to ultimately promote the idea that Tatsuaki Okamoto to any and all who investigated the source of bitcoin long enough. But Tatsuaki Okamoto is just a cog. He's not some rogue savoir out to topple centralized banks. Not at all. He is a crypto scientist who was paid by government and intelligence agencies to do research.

Bitcoin is an NSA/DARPA lab set into the wild. Scientific technology grants issued by government and intelligence agencies are how these labs are funded and promoted. The regulation and control of bitcoin has been actively developed alongside the development of the network. In fact, the controls, policy and regulation are WAY WAY more mature than the bitcoin protocol itself. That's why we see things like Greenlist written into law without a mention of bitcoin until recently.

This is not tinfoil hattish. This is just reality. No one forced ANYONE to believe the Satoshi fairytale.. The libertarian Satoshi myth has been promoted in stealth to specifically promote ADOPTION and DEVELOPMENT. It's no different than the internet and WWW itself. EXACTLY the same. That is why you see many www early adopters saying bitcoin "feels" the same as the early internet. I am one of those people.

In 94-96 the public internet was ALL about freedom of information. FREE COMMUNICATION. It was ALL about liberty and freedom. I wish i could transport some of you back in time so you could see for yourselves. The promise of free phonecalls with the freeworlddialup, free media with IUMA and the MBONE. All this freedom and liberty had people pouring their heart and soul into developing it. Now look at it. Facebook, google.. it is a GIANT SURVEILLANCE grid. And if you look for and read DARPA/NSA docs from the 80s and early 90s that was what it was always meant to be. I am not discounting all the socially great things that happen online.. But from the perspective of DARPA/NSA and control freaks.. it was created for the express purpose of control. A military purpose. A strategic purpose.

What is bitcoin? Bitcoin IS the one world digital currency. We all have a deterministic UUID that has been generated from our biometric data. This UUID will be related to all your datastores. This UUID is your mark. This UUID is what is used to buy and sell online and in the real world. This UUID is the primary key in your Greenlist identity.
"

Part III: The Aggressor-Owner Duality and Restraints On Property

PART 3: MORAL LIMITS ON PROPERTY

The non-aggression principle limits coercion to what is necessary for defense of person and property.  The limits of "person" are relatively clear, although not without controversy, compared to the limits of "property."  The duality model suggests that, to achieve social balance, some complementary limits on property should also be recognized.

Property may be understood as exclusive rights pertaining to some tangible or intangible object.   Without exclusive rights, property does not exist.  Therefore, limiting property rights (as opposed to eliminating such rights altogether) can not consist of removing exclusivity as a feature of property rights.  Instead, limits must consist of rejecting property claims to objects of certain types, or under certain circumstances.  For example, rejecting property claims made on other persons (i.e., slavery) is an example of a moral limit.

A simple approach to moral limits on property rights might include just holding that any property not gained by improper aggression is proper and moral.  While it is true that property claims gained by immoral aggression are illegitimate, the converse is not necessarily true.  More to the point, a statement that all property rights gained without improper aggression are proper is merely a truism based on circular logic.  Defense of property is a justified use of aggression.  Since the definition of proper aggression relies on property, the definition of property cannot depend on aggression without making both definitions circular.  The definition of aggression cannot be used to discern moral limits on property rights.

Similarly, moral theorists have traditionally looked for moral justification for property rights in a labor theory, by which unowned matter is converted to morally justified property by application of productive labor.  Such theories are useful for explaining how property might be justly acquired, but say nothing whatsoever about whether or not property claims to otherwise justly acquired property are moral.  Labor-based justifications for property rights boil down into the position that any property not gained by improper aggression is proper and moral.  That such a position places no actual limits on property, and is merely circular, is pointed out in the preceding paragraph.  Again, justifications based in non-aggression, and by extension labor-based justifications, are logically incapable of providing moral limits to property rights.  Placing limits on how property can justly be acquired does not provide any limiting constraints on what can morally be acquired and owned.

It's important to distinguish between unequal limits on property rights and those that are uniformly applied.  For example, statist systems  are often eager to limit personal property rights of all kinds, but without limiting property claims by the state.  At the statist extreme, all property claims including the ownership of one's own body are regarded as mere privileges granted by the state, while ownership rights of the state are absolute.  All property is "collective" and therefore subject to the control of whomever rules the collective.  These are not limits at all.  They are instead reallocation of property rights by those who hold political power.

A moral limit on property must apply equally to all persons, regardless of social status.  Such limits define what cannot be owned by anyone, things such as the atmosphere, oceans, and slaves.  Such limits may also define things that can only be owned or used up to some limit, which may be different in different circumstances. 
 
Under the duality model, we might inquire whether moral limits on property can be discerned by looking for limits on property that are complementary to limits on aggression.  If moral aggression is limited to that which is necessary for defense, what are moral property rights limited to?

Before attempting to answer this question, consider what property is used for.  Property can be used for consumption or for production, or for some combination of these uses.  Consumption may be defined as any use that decreases the economic value of the property consumed, on balance.  Production is the transformation of less valuable property into more valuable property, by application of labor, including the accumulation of additional property.  Property may require preservation to prevent it from losing economic value; preservation that requires any activity may be considered a form of production.  Speculative investment may be may be considered a productive use requiring preservation and finding willing buyers, at minimum. 

Property that is completely unused and unpreserved for a sufficiently long time is abandoned.   Once abandoned, it is no longer subject to any claim of exclusivity.  Ownership of property requires both use and exclusivity.  Limits on property may be of two kinds: those that negate any exclusive claim to a class of objects, and those that relate to use, such as defining when abandonment occurs or placing other limitations on use.

So how might inappropriate uses and property claims be discerned in the duality model?  Duality does not explicitly provide guidance to how such limits should operate.  Instead, the concept of duality leads to an expectation that, if morality demands a limit to the exercise of aggression, it similarly demands a limit to the exercise of property claims.  Such limits might be discerned by the same fundamental principle or principles that make limits to aggression apparent.  What such principles are deserves a moment of reflection.

It was posited in Part II that improper aggression is based on the difference between defense and offense, with defense distinguished from offense based on whether or not the aggression is necessary to stop an ongoing or imminent attack and whether it increases the aggressor.  In both cases, the limit on aggression is a manifest aspect of the Golden Rule, which might also be called the fundamental principle of reciprocity.  Aggression satisfies reciprocity if those who claim a moral right to aggress adopt the position that others may claim the same moral right, when reciprocal circumstances exist.  The only logically coherent systems based on reciprocity are those in which (a) defined, reciprocal limits are placed on all exercise of aggression, or (b) every person with the power to aggress must do so until only one person remains.  Anything system in between is not governed by any coherent logical principle, and must include a degree of arbitrary exercise of power.

Reciprocity is the essential fabric of society; without it, there can be no moral limits to aggression or property claims.  In a sense, morality is reciprocity.   Without reciprocity, the only law is that of power: whatever any person has the power to do is lawful, and no moral judgment on any action is possible.  Society cannot exist without moral judgment.  When any action is as permissible and as just as any other, there can exist no ordered relationships or expectations between persons.  Without ordered relationships and expectations among persons, there is no society.  People can certainly exist in the short term without society, but whether the human species can survive in the long term without society and without morality is an empirical question that is beyond the scope of this essay.

Society may not be ordered perfectly in a moral sense, that is, society can exist without perfectly embodying the reciprocity principle.  In other words, morally imperfect societies can and obviously do exist.  Such societies may institutionalize a mixture of moral and amoral conduct.  For example, in hierarchical societies, all "others" possessing reciprocal rights must be of the same social status, and a layered structure of social classes each possessing different rights may exist.  Nonetheless, within each class, perfect reciprocity is the moral standard.  To the extent one class claims superior rights and thereby oppresses a lower class, it does so by an exercise of power, not of morality.  As power is amoral, a perfectly moral society must be classless.

Therefore, the duality model suggests that moral limits to property should be discernible from the reciprocity principle, just as moral limits on aggression are discernible.  Reciprocity leads to the observation that aggression, to be morally justified, must be limited to what is necessary for defense.  It might similarly be posited, therefore, that morally justified property rights are limited to those necessary to secure the right holder's freedom of action, security, and health against competing property claims of others.  Second, reciprocity teaches that proper exercise of aggression requires carefully distinguishing offense from defense, to avoid aggressive encroachment on others.  It is posited, therefore that morally justified property claims must be limited to do those that do not disable any other person from asserting property rights reciprocal in kind to those being asserted.  Very briefly, the basic principle of reciprocity may be divided into the twin subsidiaries of necessity and non-encroachment.  These principles apply equally well to limitations on use or class of property that can be owned.

Consider, for example, slavery.  Slavery takes many forms, but may be generally understood as a state in which a person is coerced into involuntary servitude to another, without just compensation.   Ownership of a productive slave may increase the freedom of action, security or health of the slave holder, and in some limited circumstances may even be considered necessary.  For example, a person with a pressing medical need or disability may be unable to obtain desired medical or nursing care, which may be necessary to preserve the person's life.  In such straits, can the sick or disabled person gain a property interest in a doctor's services, under which the doctor is required to provide services to the sick person involuntarily and without compensation?  That is, can the sick person claim to own a doctor as a slave?

Under the formula of "necessary and non-encroaching," there are at least two reasons the answer is "no."  First, under the "necessity prong," the property claim must be necessary to defend against a competing property claim by another.  It is nonsense to state that slavery is justified by the prospective slaves' claims of ownership over their own bodies.  Self-ownership can never be a competing claim because it is limited to the self, of which there can be only one for each person.  So there is no discernible competing property claim to justify slavery.  Second, under the "non-encroachment prong" a property claim on the doctor's services disables the doctor from self-ownership without granting a reciprocal right of the doctor to own the patient. A slave can have no reciprocal right to own the master.  If some such reciprocal right exists, the relationship is not slavery but something different, likely contract.  Therefore, a claim to a slave violates the second principle as well, by encroaching on reciprocal rights of the slave to own property of like kind.

On the other hand, many claims to real and personal property clearly satisfy both limiting principles.  Competing claims exist, necessitating a property claim in almost all cases wherein a limited physical resource is divided among a group of persons.  For such property, the second prong is what provides discernment of most moral limits.  For example, claims of kings and states tend to be so expansive as to practically or actually extinguish assertion of reciprocal claims by their subjects.  Such claims are therefore immoral.  In comparison, ownership of relatively small bits of real estate or limited collections of personal property seldom, if ever, violates the non-encroachment prong of the reciprocity principle.  Non-encroachment requires further attention, which will be paid in Part IV of this series.

The limits of necessity and non-encroachment are fundamental, but do not preclude other limits on property ownership.  For example, uses of morally held property that trespass on the property rights of others can be forbidden.  Such limits are a function of trespass, not of moral limits on property rights.  Limits based on trespass or tort theory rely on an assumption of legitimate property rights being held by different persons, and do not concern the fundamental question or what can be morally owned.  Also, other limits may apply to ownership of property that are in a sense moral, but irrelevant to reciprocity and thus, socially unenforceable.  For example, a person may develop a self-destructive habit or addiction to acquiring or consuming property of some type.  Self-destructive behavior can be recognized as immoral, but is merely a vice and not subject to the coercive intervention of the law.  

Under the duality model, unnecessary suffering is avoided by balancing the polarities of a duality.  In Part I of this essay, aggression and property rights were conceived as opposite poles of a duality, while Part II argued that under the reciprocity principle, certain limits on aggression should be observed.  Part III points out prospective limits on property claims, inspired by the limits on aggression previously discussed.  These essential limits impose moral duties on property holders, to ensure that their property claims (a) are necessary to secure the rights-holder's prosperity and freedom against competing property claims by others, and (b) do not disable others from claiming reciprocal property rights in kind.

In Part IV, how the posited limits to property rights may play out in various hypothetical situations will be explored in more detail.