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"is a safe and stable store of value" First - currency is not a store of value, it's just a means to facilitate exchange. If you have more than a few thousand
by jariel 6y ago
"is a safe and stable store of value"
First - currency is not a store of value, it's just a means to facilitate exchange.
If you have more than a few thousand dollars, and want to store it for a while you can literally ask the teller at your bank and they, in their most absolute basic form of financial counsel will offer you some alternatives like long-term bonds with better yield. Or you can buy real estate or whatever.
As far as 'transparency' - it's more 'understanding'. The proles don't need to know, in fact few people need to know.
The issue of 'credit' is more or less between regimes, not between people within an economy. USDs held by China are IOUs, but that's a little less relevant when Canadians are trading CDN dollars among one another.
But it doesn't matter, regular people don't need to understand, just like they don't need to understand what mRNA is.
'Stores of Value' just really are not a problem for the proles, and frankly, once they have a little bit of money there are plenty of financial options for them. If they have a lot of money, there are people that can advise them.
We need to have monetary policy and we need it to be done well - there is absolutely no magical equation that can solve that problem for us - the notion of 'distributed currency' doesn't provide anything.
We need competency in our justice system, our medical system, in our regulatory apparatus, in municipal works etc. - the Central Bank is no different - it needs to be managed responsibly and there's no way around it.
Some people think BTC would work for developing nations i.e. the 'unbanked' masses, in areas with bad banks or shady central banks. I suggest that BTC would be bad in almost every way: it's impossible for people to use directly, they would need some kind of 'exchange' at minimum, which would have to be regulated, at which point -> just have a bank account (!) denominated in some respectable currency and that's that. Literally Bank of America could bank Nigerians if need be over their SMS. That would be much better than BTC.
Crtypo may have some value for digitizing national currencies ... but blockchain itself probably provides no value at all.
- 1996 6y ago> The proles don't need to know, in fact few people need to know Don't underestimate people > Some people think BTC would work for developing nations i.e. the 'unbanked' masses, in areas with bad banks or shady central banks. I suggest that BTC would be bad in almost every way: it's impossible for people to use directly There is no technical impossibility. It's just rarely done, but there are more and more places pricing in crypto. Eventually, the extra degree of indirection that is caused by fiat will become an inconvenience. > they would need some kind of 'exchange' at minimum, which would have to be regulated, at which point -> just have a bank account (!) denominated in some respectable currency Or altenatively, they can decide to skip the middleman: if the workers store their value in currency A, it becomes more interesting for them to buy goods denominated in the same currency A than to bother exchanging for some local stuff B of unknown (and probably rapidly falling) value. This process where a store of value becomes a unit of exchange is called dollarization, and is well studied. See also the use of cigarettes in prison. Goverments don't like that - just because their interests are not aligned with their citizens.