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> How does a static rather than unconstrained supply make something a LESS good store of value? Because a healthy capitalist economy needs an incentive to inve
by xapata 6y ago
> How does a static rather than unconstrained supply make something a LESS good store of value?
Because a healthy capitalist economy needs an incentive to invest. A steady, low, positive inflation rate is essential to encouraging those with capital to rent that capital out to those who need it for productive uses.
- imtringued 6y agoYou're absolutely correct. USD is a poor store of value, by design, because productive activity is better than unproductive activity. However, this doesn't say anything about Bitcoin, other than that it fails to be relevant as a currency. The reason why Bitcoin is a poor store of value is that owning Bitcoin doesn't guarantee that there will be an economy in the future that actually provides value equivalent to the value of your Bitcoin. If you invest into stocks or real estate you are making sure that there is a company or house out there that contributes to the economy.
- xapata 6y agoThe question was about "static rather than unconstrained supply" not the relation to real wealth.