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Lets not bear this then. Central Bank Digital Currency is just around the corner if crypto is banned. CBDC is an authoritarian's wet dream. Speak against the g

Lets not bear this then. Central Bank Digital Currency is just around the corner if crypto is banned. CBDC is an authoritarian's wet dream. Speak against the government--you're no longer allowed to transact in society. Retroactive tax...boom, negative balance.

toomuchtodo 5y ago
What do you propose as a solution for central banks and monetary policy attempting to operate in structural stagnation [1]? Do you believe digital tulips will maintain their value as real productivity declines due to demographics? Physical cash can be inflated with relatively the same ease as a CBDC through QE. You're seeking a level of control and authority of monetary policy only accessible to nation states. We agree on the problem, but not the solution. Technology does not solve challenges at the people/politics OSI layer. [1] https://www.visualcapitalist.com/700-year-decline-of-interest-rates/ https://www.visualcapitalist.com/700-year-decline-of-interes...
- dnautics 5y ago
  Technology may not solve problems at the people layer but it can certainly be a forcing factor for reform. You don't think, for example, airplane tech has had an impact on immigration law?
  - deleted 5y ago
    [deleted]
- tastyfreeze 5y ago
  My desired solution is for central banks and their abusive monetary policy to die in a fire. One way to achieve that is to have many competing currencies that are not controlled by a central bank. If any are a worthy replacement for government fiat people will use it. But, that is precisely why governments will do their best to regulate use of competing currencies. China has the most restrictive capital controls in the world. It is not surprising at all that they have banned a legitimate threat to their control over the country's money.
  - jollybean 5y ago
    This implies a probably lack of understanding of what Central Banks do. "When the ships come into harbour, nail them to the dock" - not realizing that eventually, when the tide goes out - the ship will go down several feet relative to the dock and be damaged by the fixed boarding blanks. You have to use ropes to fix ships, because the water moves. Dumping the Central Bank and even using hard currency would lead to economic collapse the very first time there is an existential shock - and the only 'saviour' would be a different form of monetary intervention i.e. fiscal policy (i.e. government budget). Also, in a completely unregulated scenario, powerful financial interests would leverage ownership of the crypto scheme and power would even be further centralized. Bitcoin is disproportionately owned by a small number of players who have absolutely zero civic perspective, they're looking to make a Trillion dollars out of nothing. If you don't like that money is managed by a large swath of banks working together with government and regulatory oversight and frankly relative transparency ... then you really won't like it when your monetary system is managed by the insane tyrant offspring of the Winkelvi and Satoshi dynasties who own 30% of the economy. Crypto mining that is energy intensive should be banned immediately on that basis alone. Aside from that, anyone declaring monetary value on a crypto asset should have to declare it, and if they don't, they go to actual prison for tax evasion. I'm looking forward to those people replacing weed smokers in prison - that would be effective public policy.
    - reedjosh 5y ago
      > Aside from that, anyone declaring monetary value on a crypto asset should have to declare it, and if they don't, they go to actual prison for tax evasion. I'm looking forward to those people replacing weed smokers in prison - that would be effective public policy. You're both pro legalization of weed and pro government? The war drugs is one the many fronts of the war on personal freedom. Ironically the thing you're railing against -- being an anonymous uncensured transaction platform -- is one of the few ways weed dealers and consumers can continue to transact. > Crypto mining that is energy intensive should be banned immediately on that basis alone. Which is only neccessary to prevent > Also, in a completely unregulated scenario, powerful financial interests would leverage ownership of the crypto scheme and power would even be further centralized. PoS _is_ succeptible to this as ownership means a voting stake. PoW prevents entrenched interests from controlling it.
- nostrademons 5y ago
  You can't solve structural economic problems with monetary policy. That's how you get (hyper)inflation, and that story's been born out dozens of times across history. The solution to real productivity declines is real productivity increases, and the incentive to reallocate your resources into the most productive activities is lacking when the cost of capital is effectively nil and the central bank bails out any misallocation.
  - imtringued 5y ago
    I don't understand your comment. When the cost of capital is nil then the common expectation is that too much investment drives up inflation and we then have to prioritize and allocate resources. Governments are begging for this to happen. I don't know why but when the central bank intends lower interest rates to overheat the market people somehow stop believing that the market even exists. It's really strange. I mean it. People talk about how the market works and will fix everything on its own but as soon as there is any government action even action that supports the market suddenly people think it will completely break down, as if the market didn't exist or function the way they say.
    - nostrademons 5y ago
      The way I look at it, the point of a market is to convince us to do things we don't want to do that nevertheless other people want us to do. Money is the mechanism for this. When you get paid for something, it sweetens the deal, so that you put up with stuff like going in to work 9-5 and dealing with angry customers and writing unit tests. Prices are an information-carrying mechanism: they tell people which activities are in high demand but low supply, and conversely, which activities aren't really worth doing. Bankruptcy and unemployment are the means with which we "prioritize and allocate resources". They are, by definition, when you stop doing what you were doing and start doing something else. So no, I would disagree that "governments are begging for this to happen" - I can't think of a government that's encouraged bankruptcy and unemployment since the 1980s. I view various forms of capital as a way to get over local maxima in economic efficiency. You borrow money or raise funds now so that you can build up tooling and innovations that will let you work more efficiently in the future, and then if you're right, you make lots of profits and can pay back your loans & dividends. If you're wrong, you go bankrupt, your investors take a haircut, and that capital goes back to other more productive activities. Constantly growing debt balances and inflation, however, I view as a way of lying to ourselves. They're basically saying "Well, in the future, things will get better", but when the future arrives and you still don't have profits, shrink the yardstick so things look better. That's exactly what "government action that supports the market" is - it's a way to avoid the failure of enterprises and loss of jobs that the market, on its own, doesn't demand enough to make profitable. Do this over 90 years and you can get some pretty extensive misallocation of capital.

toomuchtodo 5y ago

What do you propose as a solution for central banks and monetary policy attempting to operate in structural stagnation [1]? Do you believe digital tulips will maintain their value as real productivity declines due to demographics? Physical cash can be inflated with relatively the same ease as a CBDC through QE. You're seeking a level of control and authority of monetary policy only accessible to nation states. We agree on the problem, but not the solution. Technology does not solve challenges at the people/politics OSI layer. [1] https://www.visualcapitalist.com/700-year-decline-of-interest-rates/ https://www.visualcapitalist.com/700-year-decline-of-interes...

dnautics 5y ago
Technology may not solve problems at the people layer but it can certainly be a forcing factor for reform. You don't think, for example, airplane tech has had an impact on immigration law?
- deleted 5y ago
  [deleted]
tastyfreeze 5y ago
My desired solution is for central banks and their abusive monetary policy to die in a fire. One way to achieve that is to have many competing currencies that are not controlled by a central bank. If any are a worthy replacement for government fiat people will use it. But, that is precisely why governments will do their best to regulate use of competing currencies. China has the most restrictive capital controls in the world. It is not surprising at all that they have banned a legitimate threat to their control over the country's money.
- jollybean 5y ago
  This implies a probably lack of understanding of what Central Banks do. "When the ships come into harbour, nail them to the dock" - not realizing that eventually, when the tide goes out - the ship will go down several feet relative to the dock and be damaged by the fixed boarding blanks. You have to use ropes to fix ships, because the water moves. Dumping the Central Bank and even using hard currency would lead to economic collapse the very first time there is an existential shock - and the only 'saviour' would be a different form of monetary intervention i.e. fiscal policy (i.e. government budget). Also, in a completely unregulated scenario, powerful financial interests would leverage ownership of the crypto scheme and power would even be further centralized. Bitcoin is disproportionately owned by a small number of players who have absolutely zero civic perspective, they're looking to make a Trillion dollars out of nothing. If you don't like that money is managed by a large swath of banks working together with government and regulatory oversight and frankly relative transparency ... then you really won't like it when your monetary system is managed by the insane tyrant offspring of the Winkelvi and Satoshi dynasties who own 30% of the economy. Crypto mining that is energy intensive should be banned immediately on that basis alone. Aside from that, anyone declaring monetary value on a crypto asset should have to declare it, and if they don't, they go to actual prison for tax evasion. I'm looking forward to those people replacing weed smokers in prison - that would be effective public policy.
  - reedjosh 5y ago
    > Aside from that, anyone declaring monetary value on a crypto asset should have to declare it, and if they don't, they go to actual prison for tax evasion. I'm looking forward to those people replacing weed smokers in prison - that would be effective public policy. You're both pro legalization of weed and pro government? The war drugs is one the many fronts of the war on personal freedom. Ironically the thing you're railing against -- being an anonymous uncensured transaction platform -- is one of the few ways weed dealers and consumers can continue to transact. > Crypto mining that is energy intensive should be banned immediately on that basis alone. Which is only neccessary to prevent > Also, in a completely unregulated scenario, powerful financial interests would leverage ownership of the crypto scheme and power would even be further centralized. PoS _is_ succeptible to this as ownership means a voting stake. PoW prevents entrenched interests from controlling it.
nostrademons 5y ago
You can't solve structural economic problems with monetary policy. That's how you get (hyper)inflation, and that story's been born out dozens of times across history. The solution to real productivity declines is real productivity increases, and the incentive to reallocate your resources into the most productive activities is lacking when the cost of capital is effectively nil and the central bank bails out any misallocation.
- imtringued 5y ago
  I don't understand your comment. When the cost of capital is nil then the common expectation is that too much investment drives up inflation and we then have to prioritize and allocate resources. Governments are begging for this to happen. I don't know why but when the central bank intends lower interest rates to overheat the market people somehow stop believing that the market even exists. It's really strange. I mean it. People talk about how the market works and will fix everything on its own but as soon as there is any government action even action that supports the market suddenly people think it will completely break down, as if the market didn't exist or function the way they say.
  - nostrademons 5y ago
    The way I look at it, the point of a market is to convince us to do things we don't want to do that nevertheless other people want us to do. Money is the mechanism for this. When you get paid for something, it sweetens the deal, so that you put up with stuff like going in to work 9-5 and dealing with angry customers and writing unit tests. Prices are an information-carrying mechanism: they tell people which activities are in high demand but low supply, and conversely, which activities aren't really worth doing. Bankruptcy and unemployment are the means with which we "prioritize and allocate resources". They are, by definition, when you stop doing what you were doing and start doing something else. So no, I would disagree that "governments are begging for this to happen" - I can't think of a government that's encouraged bankruptcy and unemployment since the 1980s. I view various forms of capital as a way to get over local maxima in economic efficiency. You borrow money or raise funds now so that you can build up tooling and innovations that will let you work more efficiently in the future, and then if you're right, you make lots of profits and can pay back your loans & dividends. If you're wrong, you go bankrupt, your investors take a haircut, and that capital goes back to other more productive activities. Constantly growing debt balances and inflation, however, I view as a way of lying to ourselves. They're basically saying "Well, in the future, things will get better", but when the future arrives and you still don't have profits, shrink the yardstick so things look better. That's exactly what "government action that supports the market" is - it's a way to avoid the failure of enterprises and loss of jobs that the market, on its own, doesn't demand enough to make profitable. Do this over 90 years and you can get some pretty extensive misallocation of capital.