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Quite frankly, I don't care much what random pseudoscientific Keynesians claim is good for "the economy". I care what is very obviously good for me, which is ap
by wyager 10y ago
Quite frankly, I don't care much what random pseudoscientific Keynesians claim is good for "the economy". I care what is very obviously good for me, which is appreciating assets.
- MarkMc 10y agoIsn't the appreciation of your assets related to the health of the economy?
- wyager 10y agoCertainly, but there are two confounding factors. First, even if the Keynesians are correct, for which I have low confidence, it is not clear that the small benefit to the economy of not having a government-supported stable or deflationary store of value outweighs the personal benefit to me of choosing to use a deflationary store of value anyway. Second, even if it's slightly better for everyone to only hold money in inflationary assets, the Nash equilibrium is for everyone to choose to hold deflationary assets anyway, because any one person can defect and improve their own situation by choosing not to hold inflationary assets. The government will try to maintain the (alleged) Pareto optimum by discouraging/outlawing the use of non-fiat assets for trade, which has the convenient side effect of (among other things) giving them the control necessary to implement negative interest rates and gradually get rid of hard cash, but that's a whole 'nother story.