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> They’ve also spread an idea that money printing is the singular source of inflation, which isn’t true at all. Bitcoin, for example, is an inflating asset due

> They’ve also spread an idea that money printing is the singular source of inflation, which isn’t true at all. Bitcoin, for example, is an inflating asset due to hype-driven demand. Uh, I'm very much of the opinion that your average BTC fan isn't exactly educated about macroeconomics, but this sentence makes absolutely no sense. Inflation isn't a thing that happens to a currency, it's a thing that happens to an economy. It's a systemic increase in prices across a basket of assets that demonstrates the devaluation of a currency, as a single unit of that currency effectively buys less. Bitcoin, if it had been a usable currency over the last decade, is very clearly deflationary, as its rise in value as a currency relative to USD has dramatically outpaced the rise in the price of goods and services as denominated in USD, meaning that had prices been denominated in BTC, they would have dropped.

jcranmer 6y ago
Inflation can happen to assets, and PragmaticPulp is analyzing Bitcoin as an asset, not a currency. Given that even when you buy stuff with BTC, you're buying a product or service denominated in USD, their analysis is generally more correct than arguing that Bitcoin should be analyzed as a currency.
- CarelessExpert 6y ago
  > Inflation can happen to assets, and PragmaticPulp is analyzing Bitcoin as an asset, not a currency. Actually PragmaticPulp was doing both. In the comment I quoted, they stated: > They’ve also spread an idea that money printing is the singular source of inflation, which isn’t true at all. This is specifically referring to currency inflation. They then went on to say: > Bitcoin, for example, is an inflating asset due to hype-driven demand. As you say, this is asset inflation. These should not be compared like this, which is why I noted that "this sentence makes absolutely no sense." I stand by that statement.

jcranmer 6y ago

Inflation can happen to assets, and PragmaticPulp is analyzing Bitcoin as an asset, not a currency. Given that even when you buy stuff with BTC, you're buying a product or service denominated in USD, their analysis is generally more correct than arguing that Bitcoin should be analyzed as a currency.

CarelessExpert 6y ago
> Inflation can happen to assets, and PragmaticPulp is analyzing Bitcoin as an asset, not a currency. Actually PragmaticPulp was doing both. In the comment I quoted, they stated: > They’ve also spread an idea that money printing is the singular source of inflation, which isn’t true at all. This is specifically referring to currency inflation. They then went on to say: > Bitcoin, for example, is an inflating asset due to hype-driven demand. As you say, this is asset inflation. These should not be compared like this, which is why I noted that "this sentence makes absolutely no sense." I stand by that statement.