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You as many other technologists write knowingly of currencies and economies and how they should/could function as if of mechanics flying submarines. Your assump

by qubex 9y ago

You as many other technologists write knowingly of currencies and economies and how they should/could function as if of mechanics flying submarines. Your assumptions are all wrong.

tomjen3 9y ago
My assumptions are that I can save money by not using them, that one should not take on a debt burden that one cannot pay back and that pumping billions of phantom money into the world will result in bubbles. Look I know, the average economist disagree with me. But the ideas (other than no inflation, which is more a moral thing than a thing of economics) are not mine - they belong to Hayek and to some degree Milton Friedman. Friedman got a nobel prize in economics; Hayek was the opponent of Keynes, and despite a bit less than a century after the disagreement we haven't gotten rid of cyclic boom and bust. I believe economies are significantly simpler than economists believe - and macro economists have an atrocious record of predicting the future.
- qubex 9y ago
  Fair enough, we can agree to disagree about first principles. It just leaves me a bit nonplussed, as if I came to you and started to preach to you about how a computer processor contains sentient elves. I could probably make some workable predictions from that statement, but by overestimating the inherent autonomy of a deterministic processor I'd also make some statements you would hold to be ludicrous. To each his own domain, I cannot really attack your assumptions, just what you derive from them; of your principles and beliefs I can only provide commentary, and on the topic I shall be as succinct as I can. To wit, the “phantom money” you mention seems to allude to allude to a contrast to non-phantom money, supposedly some kind of “real stuff” that meets your intuition of being a unilateral asset. National debt for a country that can issue bonds denominated in currency it itself controls is not at all comparable to the debt accrued by the private household or firm. Through varying levels of inflation, that debt-load becomes more manageable over time, a process I am sure you are aware of and conversant with. Insofar as it is a debt repayable mostly to the citizens and institutions of the nation itself, denominated in a currency that the sovereign government controls, it is hardly ever going to be unplayable. Nor will there be wholesale plunder of savings through hyper-inflation or other means... it's usually a measured process. And the debt provides a place for savers to safely park their excess liquidity. If they did not have the national debt to fund, they would go on the hunt for other, riskier assets to use as interest-bearing vehicles, and they'd bid down the price of risky financial assets and achieve lower expected returns as a result. Macroeconomics is surprisingly adept at unravelling how capital flows flux through a body politic. We tend to explain retroactively. Now people are putting themselves out there making fairly crisp, and as-yet un-falsified predictions of a crash on the way... we'll see if I was right or wrong to be convinced by their argument.

by qubex 9y ago

You as many other technologists write knowingly of currencies and economies and how they should/could function as if of mechanics flying submarines. Your assumptions are all wrong.

tomjen3 9y ago

My assumptions are that I can save money by not using them, that one should not take on a debt burden that one cannot pay back and that pumping billions of phantom money into the world will result in bubbles. Look I know, the average economist disagree with me. But the ideas (other than no inflation, which is more a moral thing than a thing of economics) are not mine - they belong to Hayek and to some degree Milton Friedman. Friedman got a nobel prize in economics; Hayek was the opponent of Keynes, and despite a bit less than a century after the disagreement we haven't gotten rid of cyclic boom and bust. I believe economies are significantly simpler than economists believe - and macro economists have an atrocious record of predicting the future.

qubex 9y ago
Fair enough, we can agree to disagree about first principles. It just leaves me a bit nonplussed, as if I came to you and started to preach to you about how a computer processor contains sentient elves. I could probably make some workable predictions from that statement, but by overestimating the inherent autonomy of a deterministic processor I'd also make some statements you would hold to be ludicrous. To each his own domain, I cannot really attack your assumptions, just what you derive from them; of your principles and beliefs I can only provide commentary, and on the topic I shall be as succinct as I can. To wit, the “phantom money” you mention seems to allude to allude to a contrast to non-phantom money, supposedly some kind of “real stuff” that meets your intuition of being a unilateral asset. National debt for a country that can issue bonds denominated in currency it itself controls is not at all comparable to the debt accrued by the private household or firm. Through varying levels of inflation, that debt-load becomes more manageable over time, a process I am sure you are aware of and conversant with. Insofar as it is a debt repayable mostly to the citizens and institutions of the nation itself, denominated in a currency that the sovereign government controls, it is hardly ever going to be unplayable. Nor will there be wholesale plunder of savings through hyper-inflation or other means... it's usually a measured process. And the debt provides a place for savers to safely park their excess liquidity. If they did not have the national debt to fund, they would go on the hunt for other, riskier assets to use as interest-bearing vehicles, and they'd bid down the price of risky financial assets and achieve lower expected returns as a result. Macroeconomics is surprisingly adept at unravelling how capital flows flux through a body politic. We tend to explain retroactively. Now people are putting themselves out there making fairly crisp, and as-yet un-falsified predictions of a crash on the way... we'll see if I was right or wrong to be convinced by their argument.