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So you consider it a feature of fiat that it is impossible for a saver to maintain their purchasing power over time unless they risk their capital on volatile a

by lowkey 5y ago

So you consider it a feature of fiat that it is impossible for a saver to maintain their purchasing power over time unless they risk their capital on volatile assets such as stocks or real estate? Why is is a good thing that widows, orphans, those living in poverty or on a fixed income have no way to save without having to Risk their principal? The only ones who benefit from inflationary fiat currencies are those closest to the new spending - via the Cantillon effect - namely bankers, politicians and their friends in the military industrial complex.

dragonwriter 5y ago
> So you consider it a feature of fiat that it is impossible for a saver to maintain their purchasing power over time unless they risk their capital on volatile assets such as stocks or real estate? Some cryptocurrencies may (in some cases, based on past performance) be good on average as long term stores of value, but even those that are good at this are extremely volatile assets, much more so than, say, blue-chip stocks. So they certainly don’t solve any problem of “you need exposure to volatile assets to not lose value of savings” that you might imagine exists. > Why is is a good thing that widows, orphans, those living in poverty or on a fixed income have no way to save without having to Rick their principal? People without surplus income have no way to save by definition, with or without risking their income. That people with surplus income need to participate in wealth generation to recurve additional wealth from storage of their surplus income is obviously a feature.
- lowkey 5y ago
  > Some cryptocurrencies may (in some cases, based on past performance) be good on average as long term stores of value This is a straw man. The argument was not for some cryptocurrency. It was for Bitcoin. Bitcoin alone has the potential to become the reserve currency of the internet. It is the only crypto designed from the ground up to withstand attacks from nation states. Bitcoin is the scarcest asset ever created. It is the most decentralized and censorship resistant, and it is secured by the most powerful super-computer in the world. Therefore it isn't just about past performance, but rather past performance combined with a fundamental analysis of the unique properties of Bitcoin that make it the best performing asset in the history of assets over it's lifetime. Bitcoin is a unique snowflake. If you cannot tell the difference between Bitcoin and other cryptos you ARE missing the point. > People without surplus income have no way to save by definition Poor or rich, most people can find a way to save some of their income for the future. It may not be much to you but giving them the option to access a store of value that grows on average at 200% per year is a revolution for these folks who often have fewer options to grow savings. You are cherry-picking poor people to suit your argument. Not all poor people have zero surplus income. Some simply have too little or too insecure surplus income to escape their plight. I for one applaud giving these people more choices for a better life.
verall 5y ago
> widows, orphans, those living in poverty or on a fixed income have no way to save This has got to be the laziest rebuttal - think of the orphans! Those living in poverty, definitionally, have less money than the not-impoverished. A deflationary currency gives value proportional to whomever is holding it. There is no incentive to loan money, as holding this deflationary currency is risk free growth. Certainly, the government printing fiat could direct those funds in undesirable or corrupt ways, but this is possible whether the fiat currency is deflating or inflating. A currency that is always deflating will be subject to the tyranny of wealth holders, who now have no incentive to put any of that wealth back into the economy, absent a wealth tax or something. Fiat already has momentum, it can purchase goods and services, which can be used to create value. It can pay taxes. It does not also need to be self-compounding through deflation.
- ephbit 5y ago
  It appears to me as though "magically" the wealthy always seem to manage to store their wealth in some form that isn't devalued by inflation (real-estate, ...) whereas the poorer people are, the fewer possibilities to do something similar they have (in the traditional money system). So systematically, inflation hits the poorer people more. Yes, a deflationary currency would maybe benefit the already wealthy more than the poorer, but somehow I don't need to hesitate which one (inflationary, deflationary) I'd rather choose.
  - verall 5y ago
    I completely agree, systematically, inflation his poorer people more. This is not a prerequisite for inflationary money systems in theory, but it is the state of Earth's inflationary money systems. A deflationary currency does not maybe benefit the already wealthy, it directly imparts "real value" proportional to held currency. If you have ideas for a deflationary system that solves this, through wealth taxes or something, I am all ears. > somehow I don't need to hesitate which one (inflationary, deflationary) I'd rather choose Because relative to most people, you are wealthy! How are young people supposed to find work in a deflationary system?
- lowkey 5y ago

by lowkey 5y ago

dragonwriter 5y ago

> So you consider it a feature of fiat that it is impossible for a saver to maintain their purchasing power over time unless they risk their capital on volatile assets such as stocks or real estate? Some cryptocurrencies may (in some cases, based on past performance) be good on average as long term stores of value, but even those that are good at this are extremely volatile assets, much more so than, say, blue-chip stocks. So they certainly don’t solve any problem of “you need exposure to volatile assets to not lose value of savings” that you might imagine exists. > Why is is a good thing that widows, orphans, those living in poverty or on a fixed income have no way to save without having to Rick their principal? People without surplus income have no way to save by definition, with or without risking their income. That people with surplus income need to participate in wealth generation to recurve additional wealth from storage of their surplus income is obviously a feature.

lowkey 5y ago
> Some cryptocurrencies may (in some cases, based on past performance) be good on average as long term stores of value This is a straw man. The argument was not for some cryptocurrency. It was for Bitcoin. Bitcoin alone has the potential to become the reserve currency of the internet. It is the only crypto designed from the ground up to withstand attacks from nation states. Bitcoin is the scarcest asset ever created. It is the most decentralized and censorship resistant, and it is secured by the most powerful super-computer in the world. Therefore it isn't just about past performance, but rather past performance combined with a fundamental analysis of the unique properties of Bitcoin that make it the best performing asset in the history of assets over it's lifetime. Bitcoin is a unique snowflake. If you cannot tell the difference between Bitcoin and other cryptos you ARE missing the point. > People without surplus income have no way to save by definition Poor or rich, most people can find a way to save some of their income for the future. It may not be much to you but giving them the option to access a store of value that grows on average at 200% per year is a revolution for these folks who often have fewer options to grow savings. You are cherry-picking poor people to suit your argument. Not all poor people have zero surplus income. Some simply have too little or too insecure surplus income to escape their plight. I for one applaud giving these people more choices for a better life.

verall 5y ago

> widows, orphans, those living in poverty or on a fixed income have no way to save This has got to be the laziest rebuttal - think of the orphans! Those living in poverty, definitionally, have less money than the not-impoverished. A deflationary currency gives value proportional to whomever is holding it. There is no incentive to loan money, as holding this deflationary currency is risk free growth. Certainly, the government printing fiat could direct those funds in undesirable or corrupt ways, but this is possible whether the fiat currency is deflating or inflating. A currency that is always deflating will be subject to the tyranny of wealth holders, who now have no incentive to put any of that wealth back into the economy, absent a wealth tax or something. Fiat already has momentum, it can purchase goods and services, which can be used to create value. It can pay taxes. It does not also need to be self-compounding through deflation.

ephbit 5y ago
It appears to me as though "magically" the wealthy always seem to manage to store their wealth in some form that isn't devalued by inflation (real-estate, ...) whereas the poorer people are, the fewer possibilities to do something similar they have (in the traditional money system). So systematically, inflation hits the poorer people more. Yes, a deflationary currency would maybe benefit the already wealthy more than the poorer, but somehow I don't need to hesitate which one (inflationary, deflationary) I'd rather choose.
- verall 5y ago
  I completely agree, systematically, inflation his poorer people more. This is not a prerequisite for inflationary money systems in theory, but it is the state of Earth's inflationary money systems. A deflationary currency does not maybe benefit the already wealthy, it directly imparts "real value" proportional to held currency. If you have ideas for a deflationary system that solves this, through wealth taxes or something, I am all ears. > somehow I don't need to hesitate which one (inflationary, deflationary) I'd rather choose Because relative to most people, you are wealthy! How are young people supposed to find work in a deflationary system?
lowkey 5y ago