3 ms·

> If you look at the history of empires, from the Romans to the Han, it is littered with instances of societal decline as a direct result of inflation and overs

• david_shi 3y ago
  The Romans were only able to fund the expansion of the empire by overextending their resources. This meant that the empire became too expensive to maintain without relying on tactics like currency debasement, subsequently triggering many of the other symptoms of decline that you listed. Of course, we aren't living in the Roman Empire today. But what is consistent is that delegating monetary policy to a third party means that they can overspend and inflate the currency base, charitably for reasons of national interest, cynically for their own gain. The rise of cryptocurrencies like Bitcoin is a sign that many people want to reduce their personal exposure to this.
  • lmm 3y ago
    > The Romans were only able to fund the expansion of the empire by overextending their resources. No, they never ran out of the resources needed to expand. It just became more individually profitable to spend those resources on internal competition, and eventually civil war, than on growing the pie. > This meant that the empire became too expensive to maintain without relying on tactics like currency debasement, subsequently triggering many of the other symptoms of decline that you listed. Even if we take this at face value, that doesn't sound like currency debasement causing the collapse - if anything it allowed them to stave it off at least for a time. Businesses renegotiating their loans/bonds is normally a precursor to going bankrupt, but that doesn't mean renegotiating your loans/bonds causes bankruptcy; if you took your loans/bonds in a form where you can't renegotiate them, that only makes you more likely to go bankrupt sooner. (Traditional currencies are in many ways like a slightly odd bond that doesn't pay interest)
  • kerouac999 3y ago
    [dead]
• adastra22 3y ago
  Also if you want to attribute the decline of Rome to any monetary policy, deflation is much more likely. Periods of deflation in the 4th and 5th centuries led to hoarding and burying of coins rather than productive use of wealth, leading to declines and further deflation. Rome never escaped from this deflationary trap and many of these coin hoards were never dug up. Ironically bitcoin attempts to replicate this failed monetary policy.
  • Kathula 3y ago
    Explain how Bitcoin, which for the next 100 years will continue to print new coins, is attempting to replicate deflation. Maybe inadvertently, by people losing access to their Bitcoins for various reasons, but the design itself certainly isn't deflationary. Not even in its final form, the supply will merely be constant. Also I find it humorus when people complain about deflation, which pretty much is the natural condition of the world. New techniques and improvements will unenviably lead to products costing less. The problematic factor has always been the current ruling money being controlled by a central authority who will debase it.
    • somenameforme 3y ago
      Constant supply creates deflation because population/usage increases. You're right that products will cost less - which is exactly what deflation is. The reason it's because taboo in modern times is ostensibly because it creates a disincentive to investment. Why invest in something that might return 5% with some risk, if your money will be worth an almost guaranteed 5% more in a year anyhow? IMO the "real" reason is because it's a proxy for politics. Governments spending trillions of dollars sends inflation skyrocketing - the US is only slightly guarded against this because of our unique ability to 'export our inflation' - a web search can elaborate more on the term if one is unfamiliar with it. So opposing inflation is largely a proxy for opposing excessive spending which is one of the main political divides, which is odd because both parties spend like maniacs - but one pretends to not want to.
      • Kathula 3y ago
• deleted 3y ago
  [deleted]