4 ms·

> I'd rather store my savings in something that is not (by design) decreasing in value. That's why you don't want to store your wealth in "cash" for investing,

by tonfa 9y ago

> I'd rather store my savings in something that is not (by design) decreasing in value. That's why you don't want to store your wealth in "cash" for investing, you most likely want to lend capital to new ventures that needs it.

moduspol 9y ago
Sure, and I almost certainly would. But isn't that side-stepping the issue? I could invest with a deflationary currency. I might not have 100% of it invested at every moment. When I do, the company could hold onto that for a while until they're able to make use of it. It benefits both of us (individually) for that money to not be decreasing in value, even if it works against us (as a society) in that we have decreased incentive to spend. The key question is that if normal rational people would choose a deflationary currency if given a choice, and that choice is becoming more and more realistic, at what point does the current strategy of "assume everyone uses the nation's main currency and do what's best for the whole economy" not work any more?
- dragonwriter 9y ago
  > at what point does the current strategy of "assume everyone uses the nation's main currency and do what's best for the whole economy" not work any more? When the government stops using it as the basis for taxation, damages in civil cases irrespective of the specific nature of the assets at issue, and criminal fines. Because as long as those (especially the first two) are true, essentially everyone will use the natiobal currency substantially, both directly and indirectly, regardless of what other assets and currencies they use, and normal monetary policy measures will affect the broader economy in the normal manner unless the auxiliary currencies are actively managed to counteract national monetary policy.
  - moduspol 9y ago
    There are already companies that allow you to pay federal taxes with Bitcoin (by converting them to USD for you). There are already debit / credit cards that allow you to have your account funds in Bitcoin, but convert to USD for a merchant when you use them. I guess to me it doesn't seem fundamentally impossible that those things could be based in a national / fiat currency that is not the same currency a large number (or even majority) of people use.
    - dragonwriter 9y ago
      > There are already companies that allow you to pay federal taxes with Bitcoin (by converting them to USD for you) That's immaterial, in the same way that you can sell non-currency assets to get dollars to pay federal taxes is. As long as the taxes are denominated and collected exclusively in dollars (and as long as that's the norm for civil damages, as well), the supply of dollars will affect the economy in the usual way, whether or not for most transactions people directly use things that are not US dollars.
      - moduspol 9y ago
        I appreciate the response but that doesn't follow logically to me.

by tonfa 9y ago

moduspol 9y ago

Sure, and I almost certainly would. But isn't that side-stepping the issue? I could invest with a deflationary currency. I might not have 100% of it invested at every moment. When I do, the company could hold onto that for a while until they're able to make use of it. It benefits both of us (individually) for that money to not be decreasing in value, even if it works against us (as a society) in that we have decreased incentive to spend. The key question is that if normal rational people would choose a deflationary currency if given a choice, and that choice is becoming more and more realistic, at what point does the current strategy of "assume everyone uses the nation's main currency and do what's best for the whole economy" not work any more?

dragonwriter 9y ago
> at what point does the current strategy of "assume everyone uses the nation's main currency and do what's best for the whole economy" not work any more? When the government stops using it as the basis for taxation, damages in civil cases irrespective of the specific nature of the assets at issue, and criminal fines. Because as long as those (especially the first two) are true, essentially everyone will use the natiobal currency substantially, both directly and indirectly, regardless of what other assets and currencies they use, and normal monetary policy measures will affect the broader economy in the normal manner unless the auxiliary currencies are actively managed to counteract national monetary policy.
- moduspol 9y ago
  There are already companies that allow you to pay federal taxes with Bitcoin (by converting them to USD for you). There are already debit / credit cards that allow you to have your account funds in Bitcoin, but convert to USD for a merchant when you use them. I guess to me it doesn't seem fundamentally impossible that those things could be based in a national / fiat currency that is not the same currency a large number (or even majority) of people use.
  - dragonwriter 9y ago
    > There are already companies that allow you to pay federal taxes with Bitcoin (by converting them to USD for you) That's immaterial, in the same way that you can sell non-currency assets to get dollars to pay federal taxes is. As long as the taxes are denominated and collected exclusively in dollars (and as long as that's the norm for civil damages, as well), the supply of dollars will affect the economy in the usual way, whether or not for most transactions people directly use things that are not US dollars.
    - moduspol 9y ago
      I appreciate the response but that doesn't follow logically to me.