Re: Remarkable statistic
Posted: July 9th, 2022, 10:09 am
*draft
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Hornblower wrote: Gold can be confiscated, tends to be stored centrally, and is hard to smuggle across borders. All you need to leave the US with $1 billion in bitcoin is remember a seed phrase of 12 words & step across the border in your shorts & flip-flops.
H
Bubblesofearth wrote:Great, so Bitcoin can be smuggled across borders by criminals.
XFool wrote:Bubblesofearth wrote:Great, so Bitcoin can be smuggled across borders by criminals.
Which, apart from speculation, seems to be its main discernible function.
Hornblower wrote:XFool wrote:Which, apart from speculation, seems to be its main discernible function.
Why does every 'opinion' expressed here seem to be taken out of a poorly-researched FT article?
Hornblower wrote:That fact you don't see money that can't be confiscated, censored, or inflated away to nothingness as useful speaks of your financial privilege.
Hornblower wrote:That fact you don't see money that can't be confiscated, censored, or inflated away to nothingness as useful speaks of your financial privilege.
H
Bubblesofearth wrote:Hornblower wrote:That fact you don't see money that can't be confiscated, censored, or inflated away to nothingness as useful speaks of your financial privilege.
H
For me, it's not so much that, it's more that I can't see most governments wanting to adopt it. They came off the gold standard for a reason so why should they go back on to an electronic equivalent? Without government adoption as legal currency it's difficult to see what role it has. Although I admit it's held up longer than I thought it would.
BoE
Jason Tuvey, economist at Capital Economics, said it is a “slightly strange policy to introduce”.
“In Zimbabwe what they’re basically doing is going back to a type of gold standard as it were, whereby the money is backed by gold,” he said.
In the late 1970s, the United States led an attempt to remove gold from the international monetary system. The Second Amendment of the International Monetary Fund’s articles was intended to achieve this aim by barring members from fixing their exchange rates to gold and removing the obligation on members to conduct transactions in gold at the officially mandated price.
Bubblesofearth wrote:Hornblower wrote:That fact you don't see money that can't be confiscated, censored, or inflated away to nothingness as useful speaks of your financial privilege.
H
For me, it's not so much that, it's more that I can't see most governments wanting to adopt it. They came off the gold standard for a reason so why should they go back on to an electronic equivalent? Without government adoption as legal currency it's difficult to see what role it has. Although I admit it's held up longer than I thought it would.
BoE
Moving to a different country, Argentina's inflation has AVERAGED 190% since 1944.
It's citizens really need a currency that it's government can't fiddle with. The IMF agreed yet another loan to the country recently, on condition that they ban crypto.
https://www.pymnts.com/cryptocurrency/2 ... -policies/
Here is an interesting BBC article about crypto in Argentina.
https://www.bbc.co.uk/news/business-60912789
Then again: "Money that can't be confiscated". My understanding is more than one person has found that to be false, or does 'confiscation' (via theft, with no state compensation) by non-state operators not count?
Urbandreamer wrote:
Recent events seem to suggest that your opinion isn't shared by all governments.
Bubblesofearth wrote:Urbandreamer wrote:
Recent events seem to suggest that your opinion isn't shared by all governments.
Which is why I was careful to say 'most governments'.
When currencies fail it is because the underlying economy is failing. Zimbabwe and Argentina have been good examples of this. It wouldn't actually make a blind bit of difference what currency a country with a failing economy adopts, the economy is still failing. They will either end up with hyperinflation of their own currency or an inability to afford to pay wages and debts in a foreign currency/gold/bitcoin.
BoE
Urbandreamer wrote:I confess that I thought you were arguing that countries would not wish to give up monetary control as it allows them to influence the economy.
The normal Kaynesian argument is that economic activity is encouraged or constrained by the availability of money to perform that activity.
Now you seem to be claiming that their failing economy is outside of such control.
Of course Austrian economists might argue that the problem is actually how governments use/abuse that control. That it is the abuse that leads to serious problems and that evidence seems to show that it's difficult to not fall into abuse. The solution is to remove the ability to abuse money from government control.
Both Zimbabwe and Argentina have in the past had booming economies.
I don't want to get political, but there have, in the past, been arguments made that the problem with communist countries economies is the lack of the profit motive. I think that it can be argued that profits you can't keep because the government won't let you do so can be just as much a problem.
It's possible that Zimbabwe may see positive results in allowing their citizens to keep the wealth that they work for.
Bubblesofearth wrote:Urbandreamer wrote:I confess that I thought you were arguing that countries would not wish to give up monetary control as it allows them to influence the economy.
The normal Kaynesian argument is that economic activity is encouraged or constrained by the availability of money to perform that activity.
Now you seem to be claiming that their failing economy is outside of such control.
Of course Austrian economists might argue that the problem is actually how governments use/abuse that control. That it is the abuse that leads to serious problems and that evidence seems to show that it's difficult to not fall into abuse. The solution is to remove the ability to abuse money from government control.
Both Zimbabwe and Argentina have in the past had booming economies.
I don't want to get political, but there have, in the past, been arguments made that the problem with communist countries economies is the lack of the profit motive. I think that it can be argued that profits you can't keep because the government won't let you do so can be just as much a problem.
It's possible that Zimbabwe may see positive results in allowing their citizens to keep the wealth that they work for.
There may be many reasons an economy fails. Some will be caused by government mismanagement and others may be outside government control. An example of the former could be mismanagement of farmland for a country dependent on farming. An example of the latter could be severe drought leading to decimation of such farmland. What currency is being used will not have a material effect on this failure. Adoption of bitcoin will not help.
My point here is that quoting countries that have experienced hyperinflation as examples of where bitcoin would have been better than fiat is a flawed argument. I don't think it provides any evidence that most governments will either want to, or be forced to, adopt bitcoin.
BoE
Hornblower wrote:
If I'm a small businessman being paid for my services in Pesos that my gov/central bank is mismanaging, & these Pesos are devaluing 50% a year....it cripples my business & ability to invest for the future. That should be obvious. A failing currency is always tied to a failing economy. There isn't a single example of a flourishing economy while the local currency used was rapidly devaluing.
If Zimbabwe gov requisitions vast amounts of private property, such as farmland, then ineptly & corruptly mismanages them, that affects the economy & the currency. If they print trillions of Zim dollars to pay for social programs that it ineptly & corruptly mismanages, then that dilutes the purchasing power of all the other Zim dollars out there.
By using the US dollar, these countries can avoid the worst excesses of gov....it constrains their actions (i.e they can't misallocate so much capital). This worked well in the past. However, it works rather less well when the US $ itself is being printed with abandon, causing 40 year highs in inflation rates. As a Zim or ES, you're TRUSTING the US to be fiscally responsible, rather than your own central bankers & politicians.
Hence why bitcoin is a superior solution, you don't need to trust anything except the maths.
Hornblower wrote:Bubblesofearth wrote:My point here is that quoting countries that have experienced hyperinflation as examples of where bitcoin would have been better than fiat is a flawed argument. I don't think it provides any evidence that most governments will either want to, or be forced to, adopt bitcoin.
I think you are wrong. You're almost saying that the underlying economy has no connection to what the government does with its currency. This is demonstrably false. That there are multiple countries (such as Zimbabwe & El Salvador) that adopted the US dollar as their currency after their own failed should show you that. The economics Prof Steve Hanke (no fan of Bitcoin) is always proposing that countries adopt a dollar standard to stop runaway inflation.
Hornblower quotes the Peso devaluing 50% a year as part of his argument for BitCoin, saying that BitCoin is a 'superior solution, where you don't need to trust anything except the maths', whilst inexplicably forgetting that BitCoin itself has lost over 50% of it's value in the last three months...
https://coinranking.com/coin/Qwsogvtv82FCd+bitcoin-btc
When a positive spin on BitCoin needs to persistently use the following comparators as a large part of their regular arguments, then I think people will see those desperate arguments for what they really are -
- Zimbabwe
- El Salvador
- Carillion
Cheers,
Itsallaguess
When a positive spin on BitCoin needs to persistently use the following comparators as a large part of their regular arguments, then I think people will see those desperate arguments for what they really are -
XFool wrote:Hornblower wrote:Bubblesofearth wrote:My point here is that quoting countries that have experienced hyperinflation as examples of where bitcoin would have been better than fiat is a flawed argument. I don't think it provides any evidence that most governments will either want to, or be forced to, adopt bitcoin.
I think you are wrong. You're almost saying that the underlying economy has no connection to what the government does with its currency. This is demonstrably false. That there are multiple countries (such as Zimbabwe & El Salvador) that adopted the US dollar as their currency after their own failed should show you that. The economics Prof Steve Hanke (no fan of Bitcoin) is always proposing that countries adopt a dollar standard to stop runaway inflation.
Forgive me, haven't you just 'cancelled' your own argument?
Hornblower wrote:XFool wrote:Hornblower wrote:Bubblesofearth wrote:My point here is that quoting countries that have experienced hyperinflation as examples of where bitcoin would have been better than fiat is a flawed argument. I don't think it provides any evidence that most governments will either want to, or be forced to, adopt bitcoin.
I think you are wrong. You're almost saying that the underlying economy has no connection to what the government does with its currency. This is demonstrably false. That there are multiple countries (such as Zimbabwe & El Salvador) that adopted the US dollar as their currency after their own failed should show you that. The economics Prof Steve Hanke (no fan of Bitcoin) is always proposing that countries adopt a dollar standard to stop runaway inflation.
Forgive me, haven't you just 'cancelled' your own argument?
Did you actually read my post?
Itsallaguess wrote:When a positive spin on BitCoin needs to persistently use the following comparators as a large part of their regular arguments, then I think people will see those desperate arguments for what they really are -
- Zimbabwe
- El Salvador
- Carillion
Cheers,
Itsallaguess