3 ms·

Is it obvious? That is the kind of arrogance people accuse tech people of having. The whole point is we DON'T want people to just hold onto a currency. If ever

Is it obvious? That is the kind of arrogance people accuse tech people of having. The whole point is we DON'T want people to just hold onto a currency. If everyone stops spending their USD and just saves them, the economy will collapse. Think about all the businesses that will go under because no one is buying anything. I could go on but really this is economics 101.

anonymous5133 9y ago
The ideals you are talking about though are socialist in nature. Based on behavioral economics, people are mostly self-interested and will do actions that maximize their benefit. If you want to use inflationary currency to benefit the economy, that's great for you but I choose to use deflationary currency instead. Also I don't buy into the economy will collapse argument. The economy will restructure itself to produce items that people want and need. That will never change. You can't eat currency or digital bits. Your arguments are primarily based on FUD.
- raiflip 9y ago
  They are not socialist in nature. Socialism is a system in which workers own the means of production instead of capital holders. I mean this in the friendliest way possible, you are not using the word socialism correctly. If you have a currency that is increasing in value, and one decreasing, which do you choose to spend? You would not "use" deflationary currency, only hold onto it. Yes the economy will restructure. People will spend USD and keep Bitcoin in their pocket. People will want to be paid in USD because they can use it to buy stuff. Bitcoin is and will stay relegated to an interesting experiment people invest in, and only use if they need its anonymity.
  - anonymous5133 9y ago
    Perhaps I was using the wrong word. The word I am talking about is something along the lines of self-sacrifice for the benefit of society. Which is pretty much the premise of socialism (workers own the means of production because this benefits society more than private capital holders owning it). >If you have a currency that is increasing in value, and one decreasing, which do you choose to spend? You would not "use" deflationary currency, only hold onto it. Like I said, you can't eat bits of currency. I would spend the deflationary currency but I would be more hesitant to spend it. I would buy stuff that I really want or need. People aren't going to starve to death or go homeless because they want to hold on to their deflationary currency. That's not reality. >Yes the economy will restructure. People will spend USD and keep Bitcoin in their pocket. People will want to be paid in USD because they can use it to buy stuff. Bitcoin is and will stay relegated to an interesting experiment people invest in, and only use if they need its anonymity. You are seeing the situation for what it is now, not for what it will be in the future. Crypto is gaining more acceptance world wide. Yes, currently people prefer to be paid with USD or similar but in the future it could be possible that people prefer crypto. Also there are lots of businesses and services that directly or indirectly accept crypto. I disagree with your last sentence. Like all things, bitcoin started as an experiment but it will go on to change the world similar to how the internet changed the world. Entire industries will be disrupted as a result. I have been in crypto since 2011 and to even be having this discussion today already shows me that the experiment has been a monumental success. In 2011, I would have never even imagined that bitcoin would reach 10k per coin.
    - raiflip 9y ago
      "Like I said, you can't eat bits of currency. I would spend the deflationary currency but I would be more hesitant to spend it. I would buy stuff that I really want or need. People aren't going to starve to death or go homeless because they want to hold on to their deflationary currency. That's not reality." Yes but if you had the choice between spending a deflationary currency or inflationary, which would you spend? Unless you want to outlaw USD in general, because USD is decreasing in value you have an incentive to spend it. "You are seeing the situation for what it is now, not for what it will be in the future. Crypto is gaining more acceptance world wide. Yes, currently people prefer to be paid with USD or similar but in the future it could be possible that people prefer crypto. Also there are lots of businesses and services that directly or indirectly accept crypto. I disagree with your last sentence. Like all things, bitcoin started as an experiment but it will go on to change the world similar to how the internet changed the world. Entire industries will be disrupted as a result. I have been in crypto since 2011 and to even be having this discussion today already shows me that the experiment has been a monumental success. In 2011, I would have never even imagined that bitcoin would reach 10k per coin." I want to engage with you but I don't see an argument here. You are only asserting that "this is the way things are, but they will change!" without saying why.
- lukas099 9y ago
  > The ideals you are talking about though are socialist in nature. So? > Based on behavioral economics, people are mostly self-interested and will do actions that maximize their benefit. I'm sure you know this, but this is exactly the opposite of what behavioral economics has shown. > You can't eat currency or digital bits. True, but if your currency is gaining value, you will be less inclined to spend that currency to start or invest in businesses, e.g.
  - anonymous5133 9y ago
    >So? That's a big problem because you need to force people to do something. How are you going to force someone to not use an asset that benefits them over an asset that does not benefit them. You have to convince them to use the inferior asset because it benefits society. That's hard to do in reality because most people are selfish by virtue of human nature. >I'm sure you know this, but this is exactly the opposite of what behavioral economics has shown. Really? That's news to me. I think you are confused by what the science is actually telling us. It is telling us that people make bad decisions because of biases. The person was still thinking that they are doing something the benefits them but due to these biases they make decisions which are not rational in hindsight. The science is not telling us that people make non-rational decisions on purpose. PBS NOVA did a good documentary on the topic called mind over money. >rue, but if your currency is gaining value, you will be less inclined to spend that currency to start or invest in businesses, e.g. I find nothing wrong with that. If businesses want the money then they will need to provide exceptional value to the customer as always.
jstanley 9y ago
> The whole point is we DON'T want people to just hold onto a currency. I understand that that is the point you're making. The point we're making is that it does not matter what you want. Given the opportunity to hold deflationary currency instead of inflationary, (all else being equal) rational actors will prefer to hold the deflationary currency. This is economics 101 indeed.
- raiflip 9y ago
  Indeed people will hold onto deflationary currency, and spend inflationary currency: https://en.wikipedia.org/wiki/Gresham%27s_law https://en.wikipedia.org/wiki/Gresham%27s_law Hence in a world of rational actors the only currency in circulation will be inflationary currencies.
  - jstanley 9y ago
    You keep bringing up Gresham's Law but I think you're neglecting the fact that it only holds in the long term when the bad money and the good money have the same face value. If they have a floating exchange rate, the good money will drive the value of the bad money towards 0. Edit: perhaps read the section of the Wikipedia article entitled "reverse of Gresham's law". It argues exactly the point I'm arguing.
    - raiflip 9y ago
      Thats a good point, I was thinking of Gresham's law as simply regarding more or less valuable currencies. Nevertheless in my other reply explain why I think the USD would still drive BTC at least out of circulation.

anonymous5133 9y ago

The ideals you are talking about though are socialist in nature. Based on behavioral economics, people are mostly self-interested and will do actions that maximize their benefit. If you want to use inflationary currency to benefit the economy, that's great for you but I choose to use deflationary currency instead. Also I don't buy into the economy will collapse argument. The economy will restructure itself to produce items that people want and need. That will never change. You can't eat currency or digital bits. Your arguments are primarily based on FUD.

raiflip 9y ago
They are not socialist in nature. Socialism is a system in which workers own the means of production instead of capital holders. I mean this in the friendliest way possible, you are not using the word socialism correctly. If you have a currency that is increasing in value, and one decreasing, which do you choose to spend? You would not "use" deflationary currency, only hold onto it. Yes the economy will restructure. People will spend USD and keep Bitcoin in their pocket. People will want to be paid in USD because they can use it to buy stuff. Bitcoin is and will stay relegated to an interesting experiment people invest in, and only use if they need its anonymity.
- anonymous5133 9y ago
  Perhaps I was using the wrong word. The word I am talking about is something along the lines of self-sacrifice for the benefit of society. Which is pretty much the premise of socialism (workers own the means of production because this benefits society more than private capital holders owning it). >If you have a currency that is increasing in value, and one decreasing, which do you choose to spend? You would not "use" deflationary currency, only hold onto it. Like I said, you can't eat bits of currency. I would spend the deflationary currency but I would be more hesitant to spend it. I would buy stuff that I really want or need. People aren't going to starve to death or go homeless because they want to hold on to their deflationary currency. That's not reality. >Yes the economy will restructure. People will spend USD and keep Bitcoin in their pocket. People will want to be paid in USD because they can use it to buy stuff. Bitcoin is and will stay relegated to an interesting experiment people invest in, and only use if they need its anonymity. You are seeing the situation for what it is now, not for what it will be in the future. Crypto is gaining more acceptance world wide. Yes, currently people prefer to be paid with USD or similar but in the future it could be possible that people prefer crypto. Also there are lots of businesses and services that directly or indirectly accept crypto. I disagree with your last sentence. Like all things, bitcoin started as an experiment but it will go on to change the world similar to how the internet changed the world. Entire industries will be disrupted as a result. I have been in crypto since 2011 and to even be having this discussion today already shows me that the experiment has been a monumental success. In 2011, I would have never even imagined that bitcoin would reach 10k per coin.
  - raiflip 9y ago
    "Like I said, you can't eat bits of currency. I would spend the deflationary currency but I would be more hesitant to spend it. I would buy stuff that I really want or need. People aren't going to starve to death or go homeless because they want to hold on to their deflationary currency. That's not reality." Yes but if you had the choice between spending a deflationary currency or inflationary, which would you spend? Unless you want to outlaw USD in general, because USD is decreasing in value you have an incentive to spend it. "You are seeing the situation for what it is now, not for what it will be in the future. Crypto is gaining more acceptance world wide. Yes, currently people prefer to be paid with USD or similar but in the future it could be possible that people prefer crypto. Also there are lots of businesses and services that directly or indirectly accept crypto. I disagree with your last sentence. Like all things, bitcoin started as an experiment but it will go on to change the world similar to how the internet changed the world. Entire industries will be disrupted as a result. I have been in crypto since 2011 and to even be having this discussion today already shows me that the experiment has been a monumental success. In 2011, I would have never even imagined that bitcoin would reach 10k per coin." I want to engage with you but I don't see an argument here. You are only asserting that "this is the way things are, but they will change!" without saying why.
lukas099 9y ago
> The ideals you are talking about though are socialist in nature. So? > Based on behavioral economics, people are mostly self-interested and will do actions that maximize their benefit. I'm sure you know this, but this is exactly the opposite of what behavioral economics has shown. > You can't eat currency or digital bits. True, but if your currency is gaining value, you will be less inclined to spend that currency to start or invest in businesses, e.g.
- anonymous5133 9y ago
  >So? That's a big problem because you need to force people to do something. How are you going to force someone to not use an asset that benefits them over an asset that does not benefit them. You have to convince them to use the inferior asset because it benefits society. That's hard to do in reality because most people are selfish by virtue of human nature. >I'm sure you know this, but this is exactly the opposite of what behavioral economics has shown. Really? That's news to me. I think you are confused by what the science is actually telling us. It is telling us that people make bad decisions because of biases. The person was still thinking that they are doing something the benefits them but due to these biases they make decisions which are not rational in hindsight. The science is not telling us that people make non-rational decisions on purpose. PBS NOVA did a good documentary on the topic called mind over money. >rue, but if your currency is gaining value, you will be less inclined to spend that currency to start or invest in businesses, e.g. I find nothing wrong with that. If businesses want the money then they will need to provide exceptional value to the customer as always.

jstanley 9y ago

> The whole point is we DON'T want people to just hold onto a currency. I understand that that is the point you're making. The point we're making is that it does not matter what you want. Given the opportunity to hold deflationary currency instead of inflationary, (all else being equal) rational actors will prefer to hold the deflationary currency. This is economics 101 indeed.

raiflip 9y ago
Indeed people will hold onto deflationary currency, and spend inflationary currency: https://en.wikipedia.org/wiki/Gresham%27s_law https://en.wikipedia.org/wiki/Gresham%27s_law Hence in a world of rational actors the only currency in circulation will be inflationary currencies.
- jstanley 9y ago
  You keep bringing up Gresham's Law but I think you're neglecting the fact that it only holds in the long term when the bad money and the good money have the same face value. If they have a floating exchange rate, the good money will drive the value of the bad money towards 0. Edit: perhaps read the section of the Wikipedia article entitled "reverse of Gresham's law". It argues exactly the point I'm arguing.
  - raiflip 9y ago
    Thats a good point, I was thinking of Gresham's law as simply regarding more or less valuable currencies. Nevertheless in my other reply explain why I think the USD would still drive BTC at least out of circulation.