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I have a deep understanding of all of the latter. I work in capital markets daily. I do not know anyone serious with my level of experience in the actual market

I have a deep understanding of all of the latter. I work in capital markets daily. I do not know anyone serious with my level of experience in the actual markets who thinks bitcoin is the answer. There are several issues with tradFi. Pointing that out is like saying the sun will rise tomorrow. In some cases, people are working on a fix. In other cases, the inefficiency and criminal activity is not ceasing because the scale is too small for overburdened regulators to care about. Not one of these uses bitcoin as a fix. Whoever is building it has almost never been in finance. They think tech bros can easily understand finance cos numbers! Except finance is extremely advanced. It’s like trying to join a full ML team after running a single random forest regression or something. The consequence of such hubris is sentences like this: > Bitcoin is the solution to the fundamentally broken debt-driven economy. The debt driven economy is by design. It’s not a fucking flaw like the hard money idiots listening to Peter Schiff daily want to believe. Sometimes it goes to excess and we get 2008. Doesn’t mean the older idea was better. There is no wealth distribution in a hard money paradigm that makes sense. For simple terms since you’re obviously not in the field, ask yourself where is money created? If you say central banks, go back to Econ 101 and study better this time.

ephbit 4y ago
> The debt driven economy is by design. People should ask "whose design?" then. Who's the beneficiary of this design? What do you think is more likely to be true? A. The wealthy/influencial/powerful/elites use their (disproportionate) power to influence the design of fundamentals of society - such as the monetary system - in a way that benefits/stabilizes their position at the top. B. The wealthy/influencial/powerful/elites just let the design of fundamentals of society - such as the monetary system - be in whatever way it's shaped by society or political processes.
mikestaub 4y ago
Bitcoin is not ever going to replace the fiat economy, it simply solves the wealth preservation problem by acting as gold v2.0. This is a huge deal as most empires in history have risen and fallen via currency manipulation, hurting millions of people in the process. The life preservers have finally arrived, just in time.
immigrantheart 4y ago
There are economists with deep understanding of finance and economy that disagree with you.
- NoticeMeSenpai 4y ago
  Who? And disagree about what exactly?
- throwawash 4y ago
  Where can I read their points of view? Can you provide some links by any chance?
  - ephbit 4y ago
    Safedean Ammous isn't 100 % studied economist. But according to his CV he studied at London School of Economics, also gave economics lectures and was/is assistant professor of economics at Lebanese American University (Beirut). [1] I'd recommend listening to his interview with Lex Fridman. [2] [1] https://capitalism.columbia.edu/files/ccs/person/cv/2015/ammous_cv.pdf https://capitalism.columbia.edu/files/ccs/person/cv/2015/amm... [2] https://lexfridman.com/saifedean-ammous/ https://lexfridman.com/saifedean-ammous/
    - throwawash 4y ago
      hmm, no government in the world supports his thesis I guess. From what I understand of his position: deflational currency is the best type of currency. Any inflation is bad etc. The reason governments create inflation is to keep population poor and control them I guess? Putting aside the weird trash-talking of status quo economists, in order to evaluate the correctness of his position, I would have to do way too much homework. His prediction of human behavior under a deflational currency though does raise some flags. He says people will buy stuff regardless. If know I can use the same money to buy two cars next year instead of buying a car this year, I will not buy a car this year. He seems to say I will.
      - 4y ago
Rerarom 4y ago
What do you think of the endogenous money theory that is being promoted from time to time?
- hnews_account_1 4y ago
  I obviously think it’s a better alternative than hard money. But it has several drawbacks, same as many other things in capitalism.
ephbit 4y ago
> There is no wealth distribution in a hard money paradigm that makes sense. Care to explain how one can come to this claim based on first principles? Maybe I'm misinterpreting this sentence of yours. I read it as: a hard money paradigm will inevitably lead to a very undesirable wealth distribuation (Gini coefficient --> 1) and there's no way to fix/prevent this other than moving from hard money to soft money. I'd refute this claim. There are completely obvious ways to prevent Gini --> 1. Effective redistribution from wealthy to poor. The only hurdle to that is political systems, voters, governments or monarchs deciding to and then enacting it. Absolutely possible.
- ephbit 4y ago
  My point here is: concerns with undesirable wealth distribution (in a hard money system) make IMO no sound argument against hard money. Because there's ways to redistribute wealth through the state. Besides that, if the current wealth distribution (under non hard money) isn't all but a calamity, then what is it? Also most states are currently doing effective redistribution of wealth so it's clearly something that can be done. One issue though in most states is that the redistribution is getting outpaced by countering effects, so it's insufficient.
- hnews_account_1 4y ago
  Good luck forcing redistribution using central authorities. The very reason for the existence of modern loans is to bypass their stupidity. You do not comprehend the literal scale of the problem. You have to replace every fucking bank employee with a govt employee (in simple terms). If you think a central body is bloated now…
  - ephbit 4y ago
    > You do not comprehend the literal scale of the problem. Phew, OK, if you write so. > You have to replace every fucking bank employee with a govt employee .. No, all it needs is a reasonable tax system without loopholes and where taxes are well balanced and of course reasonable services provided by the state funded by these taxes.
kloch 4y ago
> For simple terms since you’re obviously not in the field, ask yourself where is money created? If you say central banks, go back to Econ 101 and study better this time. The Fed itself directly created 8T USD since 2009 (QE). Some of it in the past two years even went straight to consumer's pockets via the Treasury in the form of stimmies and forgivable PPP loans (helicopter money/MMT). https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm https://www.federalreserve.gov/monetarypolicy/bst_recenttren... That's a non-trivial amount, 41% of total M2 and 61% of the increase in M2 since 2009: https://fred.stlouisfed.org/series/M2SL https://fred.stlouisfed.org/series/M2SL Where did the rest of the increase in M2 come from? Fractional reserve lending by banks -- at interest rates artificially suppressed by Fed policies specifically to encourage lending/money creation. Before the Fed was created in 1913, USD was created by fractional reserve lending by banks at market determined interest rates and the marginal increase in monetary gold and silver from mining output (typically 1-2%/yr). This historic monetary system was dynamically unstable as mining output was uncorrelated with natural business cycles and unbackstopped banks were subject to runs during downturns. The Fed was created to solve these problems, specifically the panic of 1907. Over time it's mission evolved from being a lender of last resort to actively targeting employment and consumer prices. Since the 1987 crash however, this official mandate was effectively replaced with one targeting asset prices - primarily stocks and houses (wealth effect targeting). Normal business cycles were now increasingly distorted by the fed Fed responding to (or not wanting to hurt) asset prices for fear it would psychologically affect consumer and business spending and eventually employment. This lead to a new instability: bigger booms created or exaggerated by easy Fed money, followed by bigger busts during the tightening phase. Each boom/bust cycle led to more micromanagement by the Fed and thus more instability. Since 2008 (QE), and especially after 2020 (helicopter money) they have gone completely off the rails as seen by the M2 chart above and soaring consumer prices. "Inflation is always and everywhere a monetary phenomenon - Milton Friedman"
- hnews_account_1 4y ago
  Also just to be clear, almost every measure of banking and economic crisis has reduced after the advent of central banking in most countries. 2008 still happens and we should hold everyone accountable etc but if you think living pre 1971 was some dream time with everyone eating a full meal and heavy technological innovation, you’re misguided. It’s not to say the lack of innovation was a monetary issue but removing those obstacles sure as fuck didn’t hurt.
deleted 4y ago
[deleted]
tomputer 4y ago
> Except finance is extremely advanced. Exactly. This is a problem. It can be so advanced that almost nobody understands it. Now take a look at how advanced Bitcoin is: Total circulation will be 21,000,000 coins. It'll be distributed to network nodes when they make blocks, with the amount cut in half every 4 years. first 4 years: 10,500,000 coins next 4 years: 5,250,000 coins next 4 years: 2,625,000 coins next 4 years: 1,312,500 coins etc... When that runs out, the system can support transaction fees if needed. It's based on open market competition, and there will probably always be nodes willing to process transactions for free. Satoshi Nakamoto
- hnews_account_1 4y ago
  Your idea is KISS works for finance and the rest of humanity are idiots. As you sit down and type from a device created very much by the financial engineering “complications” of the modern market (and in turn being used to create further pockets of complexity).
  - ephbit 4y ago
    > As you sit down and type from a device created very much by the financial engineering “complications” of the modern market ... That's a ridiculous claim. As if the development of complex technical devices wouldn't have happened without complex financial markets and inscrutable financial business models. Complexity in finance .. up to a certain degree it may well serve the purposes of society .. beyond some level though, excessive complexity mostly serves few big players who can manage and understand the complexity and gain an advantage over other actors with less resources (that'd be most of the rest of society).
    - hnews_account_1 4y ago
      I like your confidence. I happen to agree with the second part while I don’t want to explain the first part. See my other comments for nuance.
olalonde 4y ago
Just for your interest, you just called a few recipients of the Nobel Prize in Economics idiots.
- hnews_account_1 4y ago
  Thanks. I’d call them that again. But just for my curiosity, please, who is the econ Nobel winner shilling crypto?
  - olalonde 4y ago
    That's a loaded question, don't you think? What I meant was that there are several respected economics scholars who have endorsed "hard money" and/or competition among currencies. Regarding "shilling", Milton Friedman didn't quite do that but he largely predicted a system like Bitcoin: https://www.youtube.com/watch?v=leqjwiQidlk https://www.youtube.com/watch?v=leqjwiQidlk

ephbit 4y ago

> The debt driven economy is by design. People should ask "whose design?" then. Who's the beneficiary of this design? What do you think is more likely to be true? A. The wealthy/influencial/powerful/elites use their (disproportionate) power to influence the design of fundamentals of society - such as the monetary system - in a way that benefits/stabilizes their position at the top. B. The wealthy/influencial/powerful/elites just let the design of fundamentals of society - such as the monetary system - be in whatever way it's shaped by society or political processes.

mikestaub 4y ago

Bitcoin is not ever going to replace the fiat economy, it simply solves the wealth preservation problem by acting as gold v2.0. This is a huge deal as most empires in history have risen and fallen via currency manipulation, hurting millions of people in the process. The life preservers have finally arrived, just in time.

immigrantheart 4y ago

There are economists with deep understanding of finance and economy that disagree with you.

NoticeMeSenpai 4y ago
Who? And disagree about what exactly?
throwawash 4y ago
Where can I read their points of view? Can you provide some links by any chance?
- ephbit 4y ago
  Safedean Ammous isn't 100 % studied economist. But according to his CV he studied at London School of Economics, also gave economics lectures and was/is assistant professor of economics at Lebanese American University (Beirut). [1] I'd recommend listening to his interview with Lex Fridman. [2] [1] https://capitalism.columbia.edu/files/ccs/person/cv/2015/ammous_cv.pdf https://capitalism.columbia.edu/files/ccs/person/cv/2015/amm... [2] https://lexfridman.com/saifedean-ammous/ https://lexfridman.com/saifedean-ammous/
  - throwawash 4y ago
    hmm, no government in the world supports his thesis I guess. From what I understand of his position: deflational currency is the best type of currency. Any inflation is bad etc. The reason governments create inflation is to keep population poor and control them I guess? Putting aside the weird trash-talking of status quo economists, in order to evaluate the correctness of his position, I would have to do way too much homework. His prediction of human behavior under a deflational currency though does raise some flags. He says people will buy stuff regardless. If know I can use the same money to buy two cars next year instead of buying a car this year, I will not buy a car this year. He seems to say I will.
    - 4y ago

Rerarom 4y ago

What do you think of the endogenous money theory that is being promoted from time to time?

hnews_account_1 4y ago
I obviously think it’s a better alternative than hard money. But it has several drawbacks, same as many other things in capitalism.

ephbit 4y ago

> There is no wealth distribution in a hard money paradigm that makes sense. Care to explain how one can come to this claim based on first principles? Maybe I'm misinterpreting this sentence of yours. I read it as: a hard money paradigm will inevitably lead to a very undesirable wealth distribuation (Gini coefficient --> 1) and there's no way to fix/prevent this other than moving from hard money to soft money. I'd refute this claim. There are completely obvious ways to prevent Gini --> 1. Effective redistribution from wealthy to poor. The only hurdle to that is political systems, voters, governments or monarchs deciding to and then enacting it. Absolutely possible.

ephbit 4y ago
My point here is: concerns with undesirable wealth distribution (in a hard money system) make IMO no sound argument against hard money. Because there's ways to redistribute wealth through the state. Besides that, if the current wealth distribution (under non hard money) isn't all but a calamity, then what is it? Also most states are currently doing effective redistribution of wealth so it's clearly something that can be done. One issue though in most states is that the redistribution is getting outpaced by countering effects, so it's insufficient.
hnews_account_1 4y ago
Good luck forcing redistribution using central authorities. The very reason for the existence of modern loans is to bypass their stupidity. You do not comprehend the literal scale of the problem. You have to replace every fucking bank employee with a govt employee (in simple terms). If you think a central body is bloated now…
- ephbit 4y ago
  > You do not comprehend the literal scale of the problem. Phew, OK, if you write so. > You have to replace every fucking bank employee with a govt employee .. No, all it needs is a reasonable tax system without loopholes and where taxes are well balanced and of course reasonable services provided by the state funded by these taxes.

kloch 4y ago

> For simple terms since you’re obviously not in the field, ask yourself where is money created? If you say central banks, go back to Econ 101 and study better this time. The Fed itself directly created 8T USD since 2009 (QE). Some of it in the past two years even went straight to consumer's pockets via the Treasury in the form of stimmies and forgivable PPP loans (helicopter money/MMT). https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm https://www.federalreserve.gov/monetarypolicy/bst_recenttren... That's a non-trivial amount, 41% of total M2 and 61% of the increase in M2 since 2009: https://fred.stlouisfed.org/series/M2SL https://fred.stlouisfed.org/series/M2SL Where did the rest of the increase in M2 come from? Fractional reserve lending by banks -- at interest rates artificially suppressed by Fed policies specifically to encourage lending/money creation. Before the Fed was created in 1913, USD was created by fractional reserve lending by banks at market determined interest rates and the marginal increase in monetary gold and silver from mining output (typically 1-2%/yr). This historic monetary system was dynamically unstable as mining output was uncorrelated with natural business cycles and unbackstopped banks were subject to runs during downturns. The Fed was created to solve these problems, specifically the panic of 1907. Over time it's mission evolved from being a lender of last resort to actively targeting employment and consumer prices. Since the 1987 crash however, this official mandate was effectively replaced with one targeting asset prices - primarily stocks and houses (wealth effect targeting). Normal business cycles were now increasingly distorted by the fed Fed responding to (or not wanting to hurt) asset prices for fear it would psychologically affect consumer and business spending and eventually employment. This lead to a new instability: bigger booms created or exaggerated by easy Fed money, followed by bigger busts during the tightening phase. Each boom/bust cycle led to more micromanagement by the Fed and thus more instability. Since 2008 (QE), and especially after 2020 (helicopter money) they have gone completely off the rails as seen by the M2 chart above and soaring consumer prices. "Inflation is always and everywhere a monetary phenomenon - Milton Friedman"

hnews_account_1 4y ago
Also just to be clear, almost every measure of banking and economic crisis has reduced after the advent of central banking in most countries. 2008 still happens and we should hold everyone accountable etc but if you think living pre 1971 was some dream time with everyone eating a full meal and heavy technological innovation, you’re misguided. It’s not to say the lack of innovation was a monetary issue but removing those obstacles sure as fuck didn’t hurt.

deleted 4y ago

[deleted]

tomputer 4y ago

> Except finance is extremely advanced. Exactly. This is a problem. It can be so advanced that almost nobody understands it. Now take a look at how advanced Bitcoin is: Total circulation will be 21,000,000 coins. It'll be distributed to network nodes when they make blocks, with the amount cut in half every 4 years. first 4 years: 10,500,000 coins next 4 years: 5,250,000 coins next 4 years: 2,625,000 coins next 4 years: 1,312,500 coins etc... When that runs out, the system can support transaction fees if needed. It's based on open market competition, and there will probably always be nodes willing to process transactions for free. Satoshi Nakamoto

hnews_account_1 4y ago
Your idea is KISS works for finance and the rest of humanity are idiots. As you sit down and type from a device created very much by the financial engineering “complications” of the modern market (and in turn being used to create further pockets of complexity).
- ephbit 4y ago
  > As you sit down and type from a device created very much by the financial engineering “complications” of the modern market ... That's a ridiculous claim. As if the development of complex technical devices wouldn't have happened without complex financial markets and inscrutable financial business models. Complexity in finance .. up to a certain degree it may well serve the purposes of society .. beyond some level though, excessive complexity mostly serves few big players who can manage and understand the complexity and gain an advantage over other actors with less resources (that'd be most of the rest of society).
  - hnews_account_1 4y ago
    I like your confidence. I happen to agree with the second part while I don’t want to explain the first part. See my other comments for nuance.

olalonde 4y ago

Just for your interest, you just called a few recipients of the Nobel Prize in Economics idiots.

hnews_account_1 4y ago
Thanks. I’d call them that again. But just for my curiosity, please, who is the econ Nobel winner shilling crypto?
- olalonde 4y ago
  That's a loaded question, don't you think? What I meant was that there are several respected economics scholars who have endorsed "hard money" and/or competition among currencies. Regarding "shilling", Milton Friedman didn't quite do that but he largely predicted a system like Bitcoin: https://www.youtube.com/watch?v=leqjwiQidlk https://www.youtube.com/watch?v=leqjwiQidlk