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When the next recession strikes, interest rates have no place to go but into negative territory. The rates will be either explicitly negative, or effectively n

When the next recession strikes, interest rates have no place to go but into negative territory. The rates will be either explicitly negative, or effectively negative (inflation higher than interest rates). When that happens, bitcoin will be the only safe haven in the world to protect your wealth. The bubble people will be changing their tune very quick.

raphaelj 9y ago
What a wonderful idea, putting your savings in an highly volatile currency! Have you ever heard about people buying gold to store value?
- etr-strike 9y ago
  The gold market can be manipulated as most people never take physical delivery of gold. There's no mechanism to audit everyone's holdings. Additionally, I'm of the opinion volatility will decrease as bitcoin matures. Do you really expect a currency bootstrapped from the ground up to not be volatile in its uptake? We'll see if you're singing the same tune when you're finally confronted with the certain depreciation of your USD holdings. (Will you still reject bitcoin when USD is depreciating at a rate of 5% per year?)
WkndTriathlete 9y ago
_The Economist_ has had several articles on countries that have experimented (temporarily) with negative interest rates and concluded those experiments didn't have much of an effect on those countries' respective economies. Whatever your view of the Fed is they are generally smart and well-read people who have probably also read those articles or the research papers backing them, so I think it's unlikely that interest rates will ever go negative.
fnovd 9y ago
When the next recession strikes, people will attempt to liquidate their Bitcoin to pay their bills and find out that no one really wants to buy them.
- etr-strike 9y ago
  There's two unknowns in this statement. 1) How does bitcoin behave during a recession and 2) What will the next recession look like? If the next recession takes the form of significant inflation -- resulting in effectively negative interest rates -- you will see flow into bitcoin. If the next recession is caused by significant defaults on debt, well, bitcoin is also the safe haven asset there. Bitcoin came into existence as a response to 2008. It's primary purpose is to protect peoples savings from central banks foolishness. I agree no one knows for sure what will happen. IMO, bitcoin is a reasonable hedge against the monetary policy we have today.
zzzzzzzza 9y ago
Japan already has negative interest rates - what's more the japanese central bank is literally buying up their stock market (a far far more inflationary version of qe than buying long term gov bonds which are basically equivalent to cash at this point anyway)... Now there is one question left to you... with all that going on, what is Japan's inflation rate?

raphaelj 9y ago

What a wonderful idea, putting your savings in an highly volatile currency! Have you ever heard about people buying gold to store value?

etr-strike 9y ago
The gold market can be manipulated as most people never take physical delivery of gold. There's no mechanism to audit everyone's holdings. Additionally, I'm of the opinion volatility will decrease as bitcoin matures. Do you really expect a currency bootstrapped from the ground up to not be volatile in its uptake? We'll see if you're singing the same tune when you're finally confronted with the certain depreciation of your USD holdings. (Will you still reject bitcoin when USD is depreciating at a rate of 5% per year?)

WkndTriathlete 9y ago

_The Economist_ has had several articles on countries that have experimented (temporarily) with negative interest rates and concluded those experiments didn't have much of an effect on those countries' respective economies. Whatever your view of the Fed is they are generally smart and well-read people who have probably also read those articles or the research papers backing them, so I think it's unlikely that interest rates will ever go negative.

fnovd 9y ago

When the next recession strikes, people will attempt to liquidate their Bitcoin to pay their bills and find out that no one really wants to buy them.

etr-strike 9y ago
There's two unknowns in this statement. 1) How does bitcoin behave during a recession and 2) What will the next recession look like? If the next recession takes the form of significant inflation -- resulting in effectively negative interest rates -- you will see flow into bitcoin. If the next recession is caused by significant defaults on debt, well, bitcoin is also the safe haven asset there. Bitcoin came into existence as a response to 2008. It's primary purpose is to protect peoples savings from central banks foolishness. I agree no one knows for sure what will happen. IMO, bitcoin is a reasonable hedge against the monetary policy we have today.

zzzzzzzza 9y ago

Japan already has negative interest rates - what's more the japanese central bank is literally buying up their stock market (a far far more inflationary version of qe than buying long term gov bonds which are basically equivalent to cash at this point anyway)... Now there is one question left to you... with all that going on, what is Japan's inflation rate?