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Generally speaking, it's a bad idea to use currency as a store of value. The unwavering stability of the almighty US Dollar is a massive historical outlier. For

Generally speaking, it's a bad idea to use currency as a store of value. The unwavering stability of the almighty US Dollar is a massive historical outlier. For most of history the wealthy didn't keep Scrooge McDuckian piles of cash around, they converted their cash into hard goods and investments like loans, which won't evaporate if hyperinflation occurs. Even today, the smart thing to do is to store most of your value in liquid and semi-liquid assets.

jon_richards 10y ago
>investments like loans, which won't evaporate if hyperinflation occurs. Loans absolutely will evaporate if hyperinflation occurs. Lets say you give a $1000 loan that pays out $2000 after two years and the value of the dollar drops 50% over the first year. You will still get $2000 in 1 year. Assuming the value of the dollar holds, you won't have made an actual profit. But what if the value of the dollar continues to drop? If you think its going to drop another 50%, you'd be better off selling your loan for $1000 now, in which case you've already lost half your value, assuming you can find a buyer.
megous 10y ago
Except it's not stable at all. If you hold USD long term, because of the inflation target of the FED, you'll be able to buy less and less. USD lost a massive amount of value in the previous century alone, despite the massive advances in every field of human activity. https://www.measuringworth.com/uscompare/relativevalue.php https://www.measuringworth.com/uscompare/relativevalue.php
- hossbeast 10y ago
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  - deleted 10y ago
    [deleted]
  - fennecfoxen 10y ago
    You actually want https://www.measuringworth.com/uscompare/ https://www.measuringworth.com/uscompare/ for the index – as https://www.measuringworth.com/uscompare/relativevalue.php https://www.measuringworth.com/uscompare/relativevalue.php which is the calculator results page. (And it was coded by an Ohio State University college student when it was on EH.Net, before being maintained by me as a college student, before being transferred over to Sam Williamson's personal-business site about ten years ago where it is now – a transfer which I always thought was weird but that's academia for you apparently... regardless, it explains the code quality.)
- gnaritas 10y ago
  Yes it is stable, inflation is a small steady largely predictable thing, that's what stability is, predictability. By contrast, Bitcoin is highly unstable, no one has any idea what it's value will be in a week, let alone 30 years down the road, but due to the dollars stability you'll have no problem finding 30 years loans denominated in USD. The USD is the very definition of a stable currency. Stable doesn't mean never losing value, it means being predictable enough to plan for the future.

jon_richards 10y ago

>investments like loans, which won't evaporate if hyperinflation occurs. Loans absolutely will evaporate if hyperinflation occurs. Lets say you give a $1000 loan that pays out $2000 after two years and the value of the dollar drops 50% over the first year. You will still get $2000 in 1 year. Assuming the value of the dollar holds, you won't have made an actual profit. But what if the value of the dollar continues to drop? If you think its going to drop another 50%, you'd be better off selling your loan for $1000 now, in which case you've already lost half your value, assuming you can find a buyer.

megous 10y ago

Except it's not stable at all. If you hold USD long term, because of the inflation target of the FED, you'll be able to buy less and less. USD lost a massive amount of value in the previous century alone, despite the massive advances in every field of human activity. https://www.measuringworth.com/uscompare/relativevalue.php https://www.measuringworth.com/uscompare/relativevalue.php

hossbeast 10y ago
Warning: Division by zero in /home2/sam/public_html/m/calculators/uscompare/relativevalue.php on line 156
- deleted 10y ago
  [deleted]
- fennecfoxen 10y ago
  You actually want https://www.measuringworth.com/uscompare/ https://www.measuringworth.com/uscompare/ for the index – as https://www.measuringworth.com/uscompare/relativevalue.php https://www.measuringworth.com/uscompare/relativevalue.php which is the calculator results page. (And it was coded by an Ohio State University college student when it was on EH.Net, before being maintained by me as a college student, before being transferred over to Sam Williamson's personal-business site about ten years ago where it is now – a transfer which I always thought was weird but that's academia for you apparently... regardless, it explains the code quality.)
gnaritas 10y ago
Yes it is stable, inflation is a small steady largely predictable thing, that's what stability is, predictability. By contrast, Bitcoin is highly unstable, no one has any idea what it's value will be in a week, let alone 30 years down the road, but due to the dollars stability you'll have no problem finding 30 years loans denominated in USD. The USD is the very definition of a stable currency. Stable doesn't mean never losing value, it means being predictable enough to plan for the future.