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Or, for that matter, leaving fiscal matters in the hands of a central bank with a board of governors appointed by democratically elected officials? Honestly, I

by lisper 6y ago

Or, for that matter, leaving fiscal matters in the hands of a central bank with a board of governors appointed by democratically elected officials? Honestly, I don't see how the status quo in crypto actually improves on that at all (unless you are in the ransomware business, of course. Then it makes sense.)

inter_netuser 6y ago
You could try auditing central banks, see how long you can remain alive. Bitcoin is an open ledger that can be audited by anyone. That alone is a significant improvement. It is also the closest thing we have in practice to the "Ideal money" proposal by Nash, that Nash spent 20 years giving lectures about around the world. Nash's notes and slides on that: http://web.math.princeton.edu/jfnj/texts_and_graphics/Main.Content/IDEAL_MONEY.../ http://web.math.princeton.edu/jfnj/texts_and_graphics/Main.C... The improvement of status quo is quite obvious. Bitcoin is a potential solution to the Triffin's dilemma. This is something of the scale that can alter the course of history and impact every country on Earth.
runeks 6y ago
> Or, for that matter, leaving fiscal matters in the hands of a central bank with a board of governors appointed by democratically elected officials? Money shouldn't be democratic. I'm not OK with a majority deciding that they're entitled to my money. More generally, private property is a good thing. I don't want majority vote to decide whether I can keep the house or car that I own.
- lisper 6y ago
  How would you pay for infrastructure?
  - runeks 6y ago
    I see nothing wrong with taxes. I just don’t think a monetary unit managed by politicians works in the long run.
    - lisper 6y ago
      But the power to set monetary policy is just a restricted version of the power to tax. Creating money is effectively a tax on savings. So why are you OK with taxes in general, but not this very restricted tax?
      - runeks 5y ago
        > Creating money is effectively a tax on savings. No, it’s much more than that. For example, by creating money, and using it to buy bonds, you can push down the rate of interest. This has nothing to do with taxes. It’s an interference with market coordination, because interest rates play a central part in this. For example, let’s say you have a business worth one billion dollars, and you earn 50 million dollars in profit per year (a 5% yield per annum). By setting the Federal Funds rate at 6%, the government can make it profitable to sell this business and deposit the proceeds in a bank account, hereby earning one percentage point more in yearly returns. The government shouldn’t have the power to halt economic activity in this manner, because it amounts to central planning, ie. communism. Which has been proven to be a disaster.
        lisper 5y ago
        > by creating money, and using it to buy bonds, you can push down the rate of interest. This has nothing to do with taxes Of course it does. It's all just wealth redistribution. Lowering interest rates redistributes wealth from lenders to borrowers, i.e. from savers to debtors. > By setting the Federal Funds rate at 6%, the government can make it profitable to sell this business The government can do exactly the same thing with tax policy. The only difference is that tax policy is more flexible (because it has many degrees of freedom rather than just one) and hence more powerful. The power to control the money supply is a proper subset of the power to tax. You can't support the latter but not the former and remain logically consistent.

by lisper 6y ago

inter_netuser 6y ago

You could try auditing central banks, see how long you can remain alive. Bitcoin is an open ledger that can be audited by anyone. That alone is a significant improvement. It is also the closest thing we have in practice to the "Ideal money" proposal by Nash, that Nash spent 20 years giving lectures about around the world. Nash's notes and slides on that: http://web.math.princeton.edu/jfnj/texts_and_graphics/Main.Content/IDEAL_MONEY.../ http://web.math.princeton.edu/jfnj/texts_and_graphics/Main.C... The improvement of status quo is quite obvious. Bitcoin is a potential solution to the Triffin's dilemma. This is something of the scale that can alter the course of history and impact every country on Earth.

runeks 6y ago

> Or, for that matter, leaving fiscal matters in the hands of a central bank with a board of governors appointed by democratically elected officials? Money shouldn't be democratic. I'm not OK with a majority deciding that they're entitled to my money. More generally, private property is a good thing. I don't want majority vote to decide whether I can keep the house or car that I own.

lisper 6y ago
How would you pay for infrastructure?
- runeks 6y ago
  I see nothing wrong with taxes. I just don’t think a monetary unit managed by politicians works in the long run.
  - lisper 6y ago
    But the power to set monetary policy is just a restricted version of the power to tax. Creating money is effectively a tax on savings. So why are you OK with taxes in general, but not this very restricted tax?
    - runeks 5y ago
      > Creating money is effectively a tax on savings. No, it’s much more than that. For example, by creating money, and using it to buy bonds, you can push down the rate of interest. This has nothing to do with taxes. It’s an interference with market coordination, because interest rates play a central part in this. For example, let’s say you have a business worth one billion dollars, and you earn 50 million dollars in profit per year (a 5% yield per annum). By setting the Federal Funds rate at 6%, the government can make it profitable to sell this business and deposit the proceeds in a bank account, hereby earning one percentage point more in yearly returns. The government shouldn’t have the power to halt economic activity in this manner, because it amounts to central planning, ie. communism. Which has been proven to be a disaster.
      - lisper 5y ago
        > by creating money, and using it to buy bonds, you can push down the rate of interest. This has nothing to do with taxes Of course it does. It's all just wealth redistribution. Lowering interest rates redistributes wealth from lenders to borrowers, i.e. from savers to debtors. > By setting the Federal Funds rate at 6%, the government can make it profitable to sell this business The government can do exactly the same thing with tax policy. The only difference is that tax policy is more flexible (because it has many degrees of freedom rather than just one) and hence more powerful. The power to control the money supply is a proper subset of the power to tax. You can't support the latter but not the former and remain logically consistent.