8 ms·

What makes cash special is that compared to other assets, it puts a bit more power into the hands of the individual and a bit less power in the hands of the gov

by TekMol 3y ago

What makes cash special is that compared to other assets, it puts a bit more power into the hands of the individual and a bit less power in the hands of the government. To count or seize the individuals cash, the government has to make some fuzz. Aka send men with guns. There seems to be some divide in our world between people who consider individual power a good thing and people who consider it unnecessary. Here in Europe, I have the feeling the vast majority of people consider it unnecessary. The vibe I get is "The system works, so why not let the government handle and control everything.". I wouldn't be surprised if that is a global phenomena and holds steady throughout time. For example, even when the US government seized their citizens gold in 1933, there was no resistance. That people consider "cash" something they "own" is already a sign that people don't understand and don't care how they are gamed by the government. The government can take the value out of that cash however it pleases by printing more of it. And no matter how much the government does that, nobody complains: https://fred.stlouisfed.org/series/BOGMBASE https://fred.stlouisfed.org/series/BOGMBASE Governments on the other hand understand very well that money is a sham. Thats why they hold hundreds of billions of dollars in gold: https://www.madisontrust.com/information-center/which-world-countries-have-the-most-gold/ https://www.madisontrust.com/information-center/which-world-... Way more than they hold foreign currency. Gold is hard to pay with though. When Russia had their Dollars frozen last year, it was not like they said "No prob, we'll use gold then". Therefore I wouldn't be surprised if countries will shift their reserves to Bitcoin in the coming decades. As it combines the durability of gold with the usability of money.

boredhedgehog 3y ago
> As it combines the durability of gold with the usability of money. But these two things are mutually exclusive. If it's durable, you don't want to use it, because it might be worth more in the future.
- tmn 3y ago
  What a solution for consumerism. Imagine we only bought what we need. I’m being half tongue and cheek
throwaway60707 3y ago
> Here in Europe, I have the feeling the vast majority of people consider it unnecessary. The vibe I get is "The system works, so why not let the government handle and control everything.". > I wouldn't be surprised if that is a golbal phenomena and holds steady throughout time. Come to the east of EU/Europe and you'll see a completely opposite vibe. No wonder, people in their 40s still remember communism. And the older people sometimes think communism was still better - however bad it was - than whatever we have now.
- TekMol 3y ago
  Which country for example?
  - pdq 3y ago
    I'd suggest watching the 1420 channel, where they interview Russians on the street. Many of the older generation have a nostalgia of life under communism, whereas the younger generation is more skeptical. Here's one of the interviews: https://www.youtube.com/watch?v=sjI8jwn0Upo https://www.youtube.com/watch?v=sjI8jwn0Upo
    - pessimizer 3y ago
      > the younger generation is more skeptical i.e., the first generations never to experience it, and the least knowledgeable.
  - throwaway60707 3y ago
    Any country that used to be part of the Eastern Bloc or the Soviet Union itself.
- TrainedMonkey 3y ago
  I've seen that vibe. In my experience, communism-was-better generally crystalizes out to two things: * Good old times / not remembering the bad parts. * Having your path in life mapped out, i.e. not dealing with uncertainty.
triyambakam 3y ago
> Governments on the other hand understand very well that money is a sham. Thats why they hold hundreds of billions of dollars in gold: > https://www.madisontrust.com/information-center/which-world-countries-have-the-most-gold/ https://www.madisontrust.com/information-center/which-world-... Wow, that was really interesting. I wonder why some supposed richer countries are quite low on that list. E.g. Sweden way down at 30
- kbenson 3y ago
  Possibly because as a total amount of gold by itself is a poor indicator of anything. As a fraction of GDP and/or per-capita might yield some numbers that at least made the amount relatable to something that countries commonly differ in in important ways.
BiteCode_dev 3y ago
As a Frenchmen, I think we can't say we are against government oversight. But I don't think I would agree that: > people consider it unnecessary In fact, I've discussed a cashless society with friends, and the majority is against, precisely because of this. Now it may be my bubble, and not apply to the average French citizen.
- mdp2021 3y ago
  > Frenchmen ... the majority is against When did it become so hard to pay for fuel with cash in your territories? The matter is creeping in...
shrubble 3y ago
There was plenty of resistance including cases that went to the Supreme Court. See https://en.m.wikipedia.org/wiki/Gold_Clause_Cases https://en.m.wikipedia.org/wiki/Gold_Clause_Cases However most people didn't have the approximately 20 ounces of gold that was the cutoff, or didn't have it in the bank to begin with.
neverartful 3y ago
"What makes cash special is that compared to other assets, it puts a bit more power into the hands of the individual and a bit less power in the hands of the government." s/bit/lot/g
ye-olde-sysrq 3y ago
Is fiat currency not another case of "the worst solution except for all the other ones we've tried?" Gold-backed reserve notes and even coins made of the metal(s) can still be debased (see https://en.wikipedia.org/wiki/Roman_currency#Debasement https://en.wikipedia.org/wiki/Roman_currency#Debasement). And as noted, transacting in ingots of the precious metals isn't practical. Also heavy and hard to securely store and transport. Trying to transact in and hold a commodity is also problematic because these metals have other uses. What if you hold a bunch of gold and then we find a better non-tarnishing conductor and switch to it, and the price plummets? What if you lent platinum to a friend and suddenly we find a room-temperature superconductor that needs platinum, and the value of that platinum is now 10x'd? Or you lent platinum to a friend and before they could spend it, its value plummets for industry reasons and now they can't even do the thing that was presumably going to allow them to eventually repay you? "Our fiat currency is valuable because, and exclusively because, our government pays its debts, has excellent regulation and enforcement, a well-understood legal system, 99% of the world's aircraft carriers, and a large stockpile of nuclear weapons" seems like a pretty decent option compared to all the others? And the Fed doing monetary policy things isn't exclusively negative. They seem to have kept us from going into a recession or having runaway inflation just this year and the three years prior. So that could've been a lot worse, I think.
- carlosjobim 3y ago
  > What if you hold a bunch of gold and then we find a better non-tarnishing conductor and switch to it, and the price plummets? With metals you can only question "What if?", with fiat currency the only question is "When?", because all fiat currencies in history have collapsed and become worthless.
  - dragonwriter 3y ago
    > all fiat currencies in history have collapsed and become worthless. No, they haven't.
    - johngladtj 3y ago
pmontra 3y ago
> The vibe I get is "The system works, so why not let the government handle and control everything.". It works probably better than in many other places, but which European country is that?
- carlosjobim 3y ago
  Netherlands, Sweden, Finland, Denmark are the countries with the most faithful government worshippers. It's simply a religion in those countries at this point. You'd expect Switzerland to be on that list, but in my experience the Swiss are nothing like that.
  - mdhen 3y ago
    So a who's who of the top ten democracy index countries. Not really surprising considering that.
  - pmontra 3y ago
    I don't want to seem dismissive but the Netherlands + Sweden + Finland + Denmark <= 40 M people, so less than 10% of the EU and they do change governments leaning alternatively to the right or to the left like any other country. Seen from outside, Switzerland has a lot of checks on government with referenda for everything, important or trivial matters.
staunton 3y ago
Gold is a sham, too. Its economic value in terms of useful uses is waaay below the market rate. The only reason people hoard gold is because everyone historically believes it to be valuable...
hgomersall 3y ago
They can take the value out of it much more easily than printing more. They just need to instruct the central bank to not redeem a deposit for the note. If for some reason a commercial bank continued to accept central bank issued notes, the government can simply require the banks to stop accepting them as a requirement for their banking license.

by TekMol 3y ago

boredhedgehog 3y ago

> As it combines the durability of gold with the usability of money. But these two things are mutually exclusive. If it's durable, you don't want to use it, because it might be worth more in the future.

tmn 3y ago
What a solution for consumerism. Imagine we only bought what we need. I’m being half tongue and cheek

throwaway60707 3y ago

> Here in Europe, I have the feeling the vast majority of people consider it unnecessary. The vibe I get is "The system works, so why not let the government handle and control everything.". > I wouldn't be surprised if that is a golbal phenomena and holds steady throughout time. Come to the east of EU/Europe and you'll see a completely opposite vibe. No wonder, people in their 40s still remember communism. And the older people sometimes think communism was still better - however bad it was - than whatever we have now.

TekMol 3y ago
Which country for example?
- pdq 3y ago
  I'd suggest watching the 1420 channel, where they interview Russians on the street. Many of the older generation have a nostalgia of life under communism, whereas the younger generation is more skeptical. Here's one of the interviews: https://www.youtube.com/watch?v=sjI8jwn0Upo https://www.youtube.com/watch?v=sjI8jwn0Upo
  - pessimizer 3y ago
    > the younger generation is more skeptical i.e., the first generations never to experience it, and the least knowledgeable.
- throwaway60707 3y ago
  Any country that used to be part of the Eastern Bloc or the Soviet Union itself.
TrainedMonkey 3y ago
I've seen that vibe. In my experience, communism-was-better generally crystalizes out to two things: * Good old times / not remembering the bad parts. * Having your path in life mapped out, i.e. not dealing with uncertainty.

triyambakam 3y ago

> Governments on the other hand understand very well that money is a sham. Thats why they hold hundreds of billions of dollars in gold: > https://www.madisontrust.com/information-center/which-world-countries-have-the-most-gold/ https://www.madisontrust.com/information-center/which-world-... Wow, that was really interesting. I wonder why some supposed richer countries are quite low on that list. E.g. Sweden way down at 30

kbenson 3y ago
Possibly because as a total amount of gold by itself is a poor indicator of anything. As a fraction of GDP and/or per-capita might yield some numbers that at least made the amount relatable to something that countries commonly differ in in important ways.

BiteCode_dev 3y ago

As a Frenchmen, I think we can't say we are against government oversight. But I don't think I would agree that: > people consider it unnecessary In fact, I've discussed a cashless society with friends, and the majority is against, precisely because of this. Now it may be my bubble, and not apply to the average French citizen.

mdp2021 3y ago
> Frenchmen ... the majority is against When did it become so hard to pay for fuel with cash in your territories? The matter is creeping in...

shrubble 3y ago

There was plenty of resistance including cases that went to the Supreme Court. See https://en.m.wikipedia.org/wiki/Gold_Clause_Cases https://en.m.wikipedia.org/wiki/Gold_Clause_Cases However most people didn't have the approximately 20 ounces of gold that was the cutoff, or didn't have it in the bank to begin with.

neverartful 3y ago

"What makes cash special is that compared to other assets, it puts a bit more power into the hands of the individual and a bit less power in the hands of the government." s/bit/lot/g

ye-olde-sysrq 3y ago

Is fiat currency not another case of "the worst solution except for all the other ones we've tried?" Gold-backed reserve notes and even coins made of the metal(s) can still be debased (see https://en.wikipedia.org/wiki/Roman_currency#Debasement https://en.wikipedia.org/wiki/Roman_currency#Debasement). And as noted, transacting in ingots of the precious metals isn't practical. Also heavy and hard to securely store and transport. Trying to transact in and hold a commodity is also problematic because these metals have other uses. What if you hold a bunch of gold and then we find a better non-tarnishing conductor and switch to it, and the price plummets? What if you lent platinum to a friend and suddenly we find a room-temperature superconductor that needs platinum, and the value of that platinum is now 10x'd? Or you lent platinum to a friend and before they could spend it, its value plummets for industry reasons and now they can't even do the thing that was presumably going to allow them to eventually repay you? "Our fiat currency is valuable because, and exclusively because, our government pays its debts, has excellent regulation and enforcement, a well-understood legal system, 99% of the world's aircraft carriers, and a large stockpile of nuclear weapons" seems like a pretty decent option compared to all the others? And the Fed doing monetary policy things isn't exclusively negative. They seem to have kept us from going into a recession or having runaway inflation just this year and the three years prior. So that could've been a lot worse, I think.

carlosjobim 3y ago
> What if you hold a bunch of gold and then we find a better non-tarnishing conductor and switch to it, and the price plummets? With metals you can only question "What if?", with fiat currency the only question is "When?", because all fiat currencies in history have collapsed and become worthless.
- dragonwriter 3y ago
  > all fiat currencies in history have collapsed and become worthless. No, they haven't.
  - johngladtj 3y ago

pmontra 3y ago

> The vibe I get is "The system works, so why not let the government handle and control everything.". It works probably better than in many other places, but which European country is that?

carlosjobim 3y ago
Netherlands, Sweden, Finland, Denmark are the countries with the most faithful government worshippers. It's simply a religion in those countries at this point. You'd expect Switzerland to be on that list, but in my experience the Swiss are nothing like that.
- mdhen 3y ago
  So a who's who of the top ten democracy index countries. Not really surprising considering that.
- pmontra 3y ago
  I don't want to seem dismissive but the Netherlands + Sweden + Finland + Denmark <= 40 M people, so less than 10% of the EU and they do change governments leaning alternatively to the right or to the left like any other country. Seen from outside, Switzerland has a lot of checks on government with referenda for everything, important or trivial matters.

staunton 3y ago

Gold is a sham, too. Its economic value in terms of useful uses is waaay below the market rate. The only reason people hoard gold is because everyone historically believes it to be valuable...

hgomersall 3y ago

They can take the value out of it much more easily than printing more. They just need to instruct the central bank to not redeem a deposit for the note. If for some reason a commercial bank continued to accept central bank issued notes, the government can simply require the banks to stop accepting them as a requirement for their banking license.