3 ms·

No, this was very specific to crypto: > The IMF was wary of lending to El Salvador while bitcoin was legal tender. Its volatile price posed a risk to financial

No, this was very specific to crypto: > The IMF was wary of lending to El Salvador while bitcoin was legal tender. Its volatile price posed a risk to financial and fiscal stability. Government currencies don't have the price volatility of Bitcoin. You simply can't reliably manage an economy with that kind of volatility.

ty6853 2y ago
You also can't print to oblivion while sending your hard money overseas if the plebs operate and pay taxes in Bitcoin.
john_texas 2y ago
[dead]
roenxi 2y ago
Why not? Government currencies are volatile too, people just tend to ignore that or blame price changes on greedy businesses. Prices change continuously. You can never be sure what the price of anything is going to be next week.
- crazygringo 2y ago
  > Government currencies are volatile too Nowhere near to the same extent. Just over the past year BTC has gone between $54K and $104K. Currencies are subject to inflation, but in a well managed economy that is generally a single digit yearly percentage and fluctuates slowly, and the currency changes value in a single direction only. Normal government currencies don't gain or lose 10% of their value over a few days in purchasing power, as regularly happens with Bitcoin.
  - Xen9 2y ago
    The distinction between government and crypto currencies is wrong one to make. I fail to see how gold-pegged, gasselized (demurraged at constant rate until they vanish down to UBI limit, except from government/CB wallets, with other assets also demurraged when sold/bought via cap gains style taxes), constant supply cryptocurrency would not be in fact better than the dollar and the euro and the yen, and it would be both inflation & deflation resistant.
    - Retric 2y ago
      You fail to see the actual price fluctuations that have occurred? This isn’t some hypothetical situation we have plenty of real world data to work from.
    - throw0101b 2y ago
      > I fail to see how gold-pegged, gasselized […] constant supply cryptocurrency would not be in fact better than the dollar and the euro and the yen, and it would be both inflation & deflation resistant. If you don't see it then then you may wish to read more economic history, as the history of gold-pegged currencies shows that they caused anything but stability: * https://archive.is/https://www.theatlantic.com/business/archive/2012/08/why-the-gold-standard-is-the-worlds-worst-economic-idea-in-2-charts/261552/ https://archive.is/https://www.theatlantic.com/business/arch... * https://archive.is/http://www.businessinsider.com/why-the-gold-standard-is-the-worst-idea-in-the-world-in-one-chart-2012-9 https://archive.is/http://www.businessinsider.com/why-the-go... * https://en.wikipedia.org/wiki/Long_Depression#Causes_of_the_crisis https://en.wikipedia.org/wiki/Long_Depression#Causes_of_the_... And it was only after leaving the gold standard that countries started to recover from the Great Depression: > In the end, recovery from the Great Depression does not begin until countries give up on the combination of the Bagehot Rule and of commitment to sound gold-standard finance. Those countries that have central banks willing to print up enough money so that people are willing to spend it--it is when you adopt such policies that your economy begins to recover. If you don’t, you become France, which sticks to the gold standard all the way up to 1937, and never gets a recovery. When World War II begins, Nazi Germany’s production--equal to France's in 1933--had doubled between 1933 and 1939. French production had fallen by 15%. * https://delong.typepad.com/delong_long_form/2013/10/the-great-depression-from-the-perspective-of-today-and-today-from-the-perspective-of-the-great-depression.html https://delong.typepad.com/delong_long_form/2013/10/the-grea...
      - Xen9 2y ago
        If you can always move to smaller denominations, deflation would not be an issue: If the price of an apple at t_0 is $2 and (using arbitrary symbol for the other currency) §2, and at t_1 $20=§2, then at t_1 citiziens in the nation using § as currency would pay §0.2 for an apple, et cetera. The other currency would have to use scientific notation, for cash. (if deflation wasn't the the cause of that crisis, this is not an answer).
  - wegfawefgawefg 2y ago
    I have seen it happen multiple time here in japan.
- mmooss 2y ago
  Are they as volatile as Bitcoin? Also, what can a government do to control Bitcoin's value, money supply, etc.? > You can never be sure what the price of anything is going to be next week. I do know what prices will be next week, within a sufficiently narrow range that I don't care. I think that applies to almost all consumers in advanced economies.
- throw0101b 2y ago
  > Prices change continuously. You can never be sure what the price of anything is going to be next week. With a decent central bank you can, as the rate of inflation is fairly predictable: * https://en.wikipedia.org/wiki/Inflation_targeting https://en.wikipedia.org/wiki/Inflation_targeting We've recorded some of the most stable prices in the last few decades with that policy: * https://en.wikipedia.org/wiki/Great_Moderation https://en.wikipedia.org/wiki/Great_Moderation as compared to when the gold standard was around: * http://archive.is/https://www.theatlantic.com/business/archive/2012/08/why-the-gold-standard-is-the-worlds-worst-economic-idea-in-2-charts/261552/ http://archive.is/https://www.theatlantic.com/business/archi... And gold isn't as stable as most people think: * https://www.macrotrends.net/1333/historical-gold-prices-100-year-chart https://www.macrotrends.net/1333/historical-gold-prices-100-... even in the modern age: > The idea behind a gold standard is that a currency becomes tied to a commodity with a stable value. The great problem with this is that gold does not have a stable value. Like any other commodity, its relative value goes up and down. For instance, in September 2022, US dollar milk prices were rising over 16%. In gold terms milk prices were rising over 23%—dangerously high inflation. * https://www.ubs.com/it/en/wealthmanagement/insights/article-adp/global/en/wealth-management/insights/chief-investment-office/market-insights/paul-donovan/2024/gold-currency.html https://www.ubs.com/it/en/wealthmanagement/insights/article-...
  - john_texas 2y ago
    The "stability in CPI" after the gold depeg in the 70s is also when wages stopped growing in real terms. Most "wealth creation" since that date is on paper.
    - throw0101b 2y ago
      > The "stability in CPI" after the gold depeg in the 70s is also when wages stopped growing in real terms. The depeging occurred in 1971: * https://en.wikipedia.org/wiki/Nixon_shock https://en.wikipedia.org/wiki/Nixon_shock the CPI didn't start going crazy until the mid- to late-1970s: * https://en.wikipedia.org/wiki/1973_oil_crisis https://en.wikipedia.org/wiki/1973_oil_crisis * https://en.wikipedia.org/wiki/1979_oil_crisis https://en.wikipedia.org/wiki/1979_oil_crisis * https://en.wikipedia.org/wiki/Supply_shock https://en.wikipedia.org/wiki/Supply_shock though there was a rising amount before any of those events: * https://www.federalreservehistory.org/essays/great-inflation https://www.federalreservehistory.org/essays/great-inflation You'll find that real wages in the US were fairly steady for most of the 1970s, falling mostly at the end, and really dropping during the 1980s: * https://www.factcheck.org/2019/06/are-wages-rising-or-flat/ https://www.factcheck.org/2019/06/are-wages-rising-or-flat/
- the_gastropod 2y ago
  Bananas and polonium are both radioactive. Degree matters.
- ozgrakkurt 2y ago
  Price volatility might be bad for trade because seller and buyer don’t know what they should do at any point. So it slows trade down, which is bad for economy. It makes buying furniture seem like day trading. This happened in Turkey couple years ago
wegfawefgawefg 2y ago
It isnt true. Look at the cost of the japanese yen relative to the dollar. I have seen prices double and then half due to international politics. Living here in Japan though, prices seem mostly stable despite the volatile yen. I am not sure how this works.
- crazygringo 2y ago
  I'm taking about currency value in local purchasing power. And that's what you're observing -- prices are mostly stable. Currency exchange fluctuations only affect imports and exports, and they vary as well between each pair of countries.
  - wegfawefgawefg 2y ago
    thats the same with bitcoin
    - crazygringo 2y ago
      I will repeat my other comment: > Just over the past year BTC has gone between $54K and $104K. That's crazy volatility. That is not the same as local currencies. And with Bitcoin there's no such thing as local purchasing power.
      - wegfawefgawefg 2y ago
        theres no local purchasing power only because it isnt used locally like that
- the_gastropod 2y ago
  Volatility is a measurable thing, though. In 1985, 1 USD was worth 260 JPY. In 2011, 1 USD was worth 76 JPY. In that 40 year history, those are the extreme high/low ends. That's a ~70% swing over the span of 26 years. By comparison, Bitcoin had a 95% swing between September 2024 and December 2024. All volatility is not equal. The degree to which Bitcoin is volatile is unmatched by any government currency I'm aware of.
hoseja 2y ago
>Government currencies don't have the price volatility of Bitcoin. You WHAT. Latest example: https://en.wikipedia.org/wiki/Turkish_lira https://en.wikipedia.org/wiki/Turkish_lira
- crazygringo 2y ago
  Obviously hyperinflation is a bad thing, and well-managed governments don't have that. But inflation isn't the same as volatility. Even when it's high, it's still gradual, predictable within a range, and goes in one direction only. Bitcoin volatility is sudden, completely unpredictable, and goes in both directions. It's far worse in every possible way.

ty6853 2y ago

You also can't print to oblivion while sending your hard money overseas if the plebs operate and pay taxes in Bitcoin.

john_texas 2y ago

[dead]

roenxi 2y ago

Why not? Government currencies are volatile too, people just tend to ignore that or blame price changes on greedy businesses. Prices change continuously. You can never be sure what the price of anything is going to be next week.

crazygringo 2y ago
> Government currencies are volatile too Nowhere near to the same extent. Just over the past year BTC has gone between $54K and $104K. Currencies are subject to inflation, but in a well managed economy that is generally a single digit yearly percentage and fluctuates slowly, and the currency changes value in a single direction only. Normal government currencies don't gain or lose 10% of their value over a few days in purchasing power, as regularly happens with Bitcoin.
- Xen9 2y ago
  The distinction between government and crypto currencies is wrong one to make. I fail to see how gold-pegged, gasselized (demurraged at constant rate until they vanish down to UBI limit, except from government/CB wallets, with other assets also demurraged when sold/bought via cap gains style taxes), constant supply cryptocurrency would not be in fact better than the dollar and the euro and the yen, and it would be both inflation & deflation resistant.
  - Retric 2y ago
    You fail to see the actual price fluctuations that have occurred? This isn’t some hypothetical situation we have plenty of real world data to work from.
  - throw0101b 2y ago
    > I fail to see how gold-pegged, gasselized […] constant supply cryptocurrency would not be in fact better than the dollar and the euro and the yen, and it would be both inflation & deflation resistant. If you don't see it then then you may wish to read more economic history, as the history of gold-pegged currencies shows that they caused anything but stability: * https://archive.is/https://www.theatlantic.com/business/archive/2012/08/why-the-gold-standard-is-the-worlds-worst-economic-idea-in-2-charts/261552/ https://archive.is/https://www.theatlantic.com/business/arch... * https://archive.is/http://www.businessinsider.com/why-the-gold-standard-is-the-worst-idea-in-the-world-in-one-chart-2012-9 https://archive.is/http://www.businessinsider.com/why-the-go... * https://en.wikipedia.org/wiki/Long_Depression#Causes_of_the_crisis https://en.wikipedia.org/wiki/Long_Depression#Causes_of_the_... And it was only after leaving the gold standard that countries started to recover from the Great Depression: > In the end, recovery from the Great Depression does not begin until countries give up on the combination of the Bagehot Rule and of commitment to sound gold-standard finance. Those countries that have central banks willing to print up enough money so that people are willing to spend it--it is when you adopt such policies that your economy begins to recover. If you don’t, you become France, which sticks to the gold standard all the way up to 1937, and never gets a recovery. When World War II begins, Nazi Germany’s production--equal to France's in 1933--had doubled between 1933 and 1939. French production had fallen by 15%. * https://delong.typepad.com/delong_long_form/2013/10/the-great-depression-from-the-perspective-of-today-and-today-from-the-perspective-of-the-great-depression.html https://delong.typepad.com/delong_long_form/2013/10/the-grea...
    - Xen9 2y ago
      If you can always move to smaller denominations, deflation would not be an issue: If the price of an apple at t_0 is $2 and (using arbitrary symbol for the other currency) §2, and at t_1 $20=§2, then at t_1 citiziens in the nation using § as currency would pay §0.2 for an apple, et cetera. The other currency would have to use scientific notation, for cash. (if deflation wasn't the the cause of that crisis, this is not an answer).
- wegfawefgawefg 2y ago
  I have seen it happen multiple time here in japan.
mmooss 2y ago
Are they as volatile as Bitcoin? Also, what can a government do to control Bitcoin's value, money supply, etc.? > You can never be sure what the price of anything is going to be next week. I do know what prices will be next week, within a sufficiently narrow range that I don't care. I think that applies to almost all consumers in advanced economies.
throw0101b 2y ago
> Prices change continuously. You can never be sure what the price of anything is going to be next week. With a decent central bank you can, as the rate of inflation is fairly predictable: * https://en.wikipedia.org/wiki/Inflation_targeting https://en.wikipedia.org/wiki/Inflation_targeting We've recorded some of the most stable prices in the last few decades with that policy: * https://en.wikipedia.org/wiki/Great_Moderation https://en.wikipedia.org/wiki/Great_Moderation as compared to when the gold standard was around: * http://archive.is/https://www.theatlantic.com/business/archive/2012/08/why-the-gold-standard-is-the-worlds-worst-economic-idea-in-2-charts/261552/ http://archive.is/https://www.theatlantic.com/business/archi... And gold isn't as stable as most people think: * https://www.macrotrends.net/1333/historical-gold-prices-100-year-chart https://www.macrotrends.net/1333/historical-gold-prices-100-... even in the modern age: > The idea behind a gold standard is that a currency becomes tied to a commodity with a stable value. The great problem with this is that gold does not have a stable value. Like any other commodity, its relative value goes up and down. For instance, in September 2022, US dollar milk prices were rising over 16%. In gold terms milk prices were rising over 23%—dangerously high inflation. * https://www.ubs.com/it/en/wealthmanagement/insights/article-adp/global/en/wealth-management/insights/chief-investment-office/market-insights/paul-donovan/2024/gold-currency.html https://www.ubs.com/it/en/wealthmanagement/insights/article-...
- john_texas 2y ago
  The "stability in CPI" after the gold depeg in the 70s is also when wages stopped growing in real terms. Most "wealth creation" since that date is on paper.
  - throw0101b 2y ago
    > The "stability in CPI" after the gold depeg in the 70s is also when wages stopped growing in real terms. The depeging occurred in 1971: * https://en.wikipedia.org/wiki/Nixon_shock https://en.wikipedia.org/wiki/Nixon_shock the CPI didn't start going crazy until the mid- to late-1970s: * https://en.wikipedia.org/wiki/1973_oil_crisis https://en.wikipedia.org/wiki/1973_oil_crisis * https://en.wikipedia.org/wiki/1979_oil_crisis https://en.wikipedia.org/wiki/1979_oil_crisis * https://en.wikipedia.org/wiki/Supply_shock https://en.wikipedia.org/wiki/Supply_shock though there was a rising amount before any of those events: * https://www.federalreservehistory.org/essays/great-inflation https://www.federalreservehistory.org/essays/great-inflation You'll find that real wages in the US were fairly steady for most of the 1970s, falling mostly at the end, and really dropping during the 1980s: * https://www.factcheck.org/2019/06/are-wages-rising-or-flat/ https://www.factcheck.org/2019/06/are-wages-rising-or-flat/
the_gastropod 2y ago
Bananas and polonium are both radioactive. Degree matters.
ozgrakkurt 2y ago
Price volatility might be bad for trade because seller and buyer don’t know what they should do at any point. So it slows trade down, which is bad for economy. It makes buying furniture seem like day trading. This happened in Turkey couple years ago

wegfawefgawefg 2y ago

It isnt true. Look at the cost of the japanese yen relative to the dollar. I have seen prices double and then half due to international politics. Living here in Japan though, prices seem mostly stable despite the volatile yen. I am not sure how this works.

crazygringo 2y ago
I'm taking about currency value in local purchasing power. And that's what you're observing -- prices are mostly stable. Currency exchange fluctuations only affect imports and exports, and they vary as well between each pair of countries.
- wegfawefgawefg 2y ago
  thats the same with bitcoin
  - crazygringo 2y ago
    I will repeat my other comment: > Just over the past year BTC has gone between $54K and $104K. That's crazy volatility. That is not the same as local currencies. And with Bitcoin there's no such thing as local purchasing power.
    - wegfawefgawefg 2y ago
      theres no local purchasing power only because it isnt used locally like that
the_gastropod 2y ago
Volatility is a measurable thing, though. In 1985, 1 USD was worth 260 JPY. In 2011, 1 USD was worth 76 JPY. In that 40 year history, those are the extreme high/low ends. That's a ~70% swing over the span of 26 years. By comparison, Bitcoin had a 95% swing between September 2024 and December 2024. All volatility is not equal. The degree to which Bitcoin is volatile is unmatched by any government currency I'm aware of.

hoseja 2y ago

>Government currencies don't have the price volatility of Bitcoin. You WHAT. Latest example: https://en.wikipedia.org/wiki/Turkish_lira https://en.wikipedia.org/wiki/Turkish_lira

crazygringo 2y ago
Obviously hyperinflation is a bad thing, and well-managed governments don't have that. But inflation isn't the same as volatility. Even when it's high, it's still gradual, predictable within a range, and goes in one direction only. Bitcoin volatility is sudden, completely unpredictable, and goes in both directions. It's far worse in every possible way.