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It also encourages them to invest their money. The choice isn't either spend money on over-consumerism or lose it, the choice is either spend it or invest it so

It also encourages them to invest their money. The choice isn't either spend money on over-consumerism or lose it, the choice is either spend it or invest it so someone else can allocate more resources to what they are doing.

rawtxapp 5y ago
For sure, but then you have to understand and research what you're investing in. We also end up with sky high (in my opinion unjustified) P/E ratios just because money doesn't have elsewhere to go and it creates all kinds of wild inaccurate pricing imo. In this world where the currency doesn't depreciate like ~95% over a 100 year period, only investments which make sense will get money thrown at them.
- NicoJuicy 5y ago
  Depends on the forward P/E, how much market share the company can take and the position they are in. If the P/E is high, it mostly has to do with what i mentioned and your are late to the "party". But high p/e stocks != Fiat money as the op mentioned.
jollybean 5y ago
This is not about incentives to spend or invest - it's about having a functioning basic unit of economic measure that is 1) stable 2) has integrity and 3) hopefully under the control over the government. BTC isn't good for any of that. USD is good for 1 and 2. The gov. can move to re-establish it's currency and have 3 as well.
- beckingz 5y ago
  Looks like USD may be losing qualities 1 or 2 depending on how you define stability or integrity.
  - jollybean 5y ago
    Just the opposite, during difficult times people rush to USD which bolsters 1 and 2. That it's used widely and fungible is what gives it value. If your own currency is destroyed, you use the one that has the most integrity that's relative to your country. For most nations the default would be USD. For Vietnam probably RMB. For Belarus either Euro or Rouble. Then you develop integrity in governance and switch to a national currency. A nations currency is actually a vert good measure of the competence and integrity of the leadership class.
saurik 5y ago
This is why there is so much VC money that people build "disruptive" companies whose primary trick is "let's lose money until all our competitors who don't understand revenue is boring are out of business" :(.

rawtxapp 5y ago

For sure, but then you have to understand and research what you're investing in. We also end up with sky high (in my opinion unjustified) P/E ratios just because money doesn't have elsewhere to go and it creates all kinds of wild inaccurate pricing imo. In this world where the currency doesn't depreciate like ~95% over a 100 year period, only investments which make sense will get money thrown at them.

NicoJuicy 5y ago
Depends on the forward P/E, how much market share the company can take and the position they are in. If the P/E is high, it mostly has to do with what i mentioned and your are late to the "party". But high p/e stocks != Fiat money as the op mentioned.

jollybean 5y ago

This is not about incentives to spend or invest - it's about having a functioning basic unit of economic measure that is 1) stable 2) has integrity and 3) hopefully under the control over the government. BTC isn't good for any of that. USD is good for 1 and 2. The gov. can move to re-establish it's currency and have 3 as well.

beckingz 5y ago
Looks like USD may be losing qualities 1 or 2 depending on how you define stability or integrity.
- jollybean 5y ago
  Just the opposite, during difficult times people rush to USD which bolsters 1 and 2. That it's used widely and fungible is what gives it value. If your own currency is destroyed, you use the one that has the most integrity that's relative to your country. For most nations the default would be USD. For Vietnam probably RMB. For Belarus either Euro or Rouble. Then you develop integrity in governance and switch to a national currency. A nations currency is actually a vert good measure of the competence and integrity of the leadership class.

saurik 5y ago

This is why there is so much VC money that people build "disruptive" companies whose primary trick is "let's lose money until all our competitors who don't understand revenue is boring are out of business" :(.