5 ms·

Don't you hate it when people conflate money with credit. That's why all the bitcoin fans can never win; even if bitcoin was the world reserve currency (simila

Don't you hate it when people conflate money with credit. That's why all the bitcoin fans can never win; even if bitcoin was the world reserve currency (similar to how gold still is today - held by central banks), it would mean jack shit because everyone would use fractional reserve lending and credit, like we've done for ages, with the booms and busts and skimming that go with it. So IMHO nothing will ever change.

bradleysmith 13y ago
it would mean a distributed work-based hashing process would be the determinant of money supply of the world reserve currency. The world reserve currency is the US dollar. Even if a central bank holds gold as a store of value, they price it and their own currency in the US dollar. If any commodity was to be labeled a de-facto 'world currency' it would be petroleum, as it is a commodity that everyone MUST purchase in some fashion. The monetary supply of the US dollar is determined by the Fed, which has no oversight from or obligation to the countries which that monetary supply affects. It's clear moral hazard, on a global scale. people would still use fractional reserve lending, and credit. But, no one sovereignty would be in control of the supply of the the medium of exchange they used. I'm not arguing it would improve anything, but it would certainly be different.
- penguindev 13y ago
  We already had, in essence, a 'proof of work' system with gold. Gold supply increases by only a percent or two per year, and it is highly resource / energy intensive. And note that many central banks, including US, China, Russia, have and /or are even adding to their gold reserves. (Ben Bernanke says it's for 'tradition' - cough, cough, eye roll, cough) But as JP Morgan said, "gold is money. everything else is credit." Banks don't care about the underlying reserve money as long as they control the credit, which gets used as if it were money. >but it would certainly be different. I don't see how. And even if it were, the powers that be like things just the way they are.
  - DanBC 13y ago
    > We already had, in essence, a 'proof of work' system with gold. Gold supply increases by only a percent or two per year, and it is highly resource / energy intensive. But the people doing a lot of the hardest dangerous work get very very lite for doing so. Money is made by pushing buttens at the right time to move numbers around a network.
    - sliverstorm 13y ago
      the people doing a lot of the hardest dangerous work get very very lite for doing so Same story with bitcoin, though the physical onus is removed.
    - penguindev 13y ago
      >Money is made by pushing buttens at the right time to move numbers around a network. Yes, and that's probably not going to ever change, not sure what your point was.... But here's where people get REALLY rich. Banks financing government debt (pushing a button, as you say) which is cosigned by 300 million of us serfs, for stupid unsustainable shit like wars and welfare. The banks and credit masters win, and the rest of us are FUCKED. PS guns and butter was what led to the end of the gold standard. If you think bitcoin is going to somehow stop governments from over spending, or banks from over lending, foreclosing, and buying assets for pennies on the dollar, you need a history lesson.
dualogy 13y ago
> Don't you hate it when people conflate money with credit Is it any wonder? Any medium-of-exchange immediately becomes credit -- a claim on some unknown-person's future offering of something. Everything else more-complicated derives from this inherent money-is-a-claim characteristic IMHO. The medium truly is the claim, aka credit.
- sitkack 13y ago
  Did I just realize that all money in our current form is credit and I never actually own anything? And whom ever controls the biggest source of credit controls the value of the "money" in my pocket at anytime? The only truly valuable thing is experience.
  - drstrangevibes 13y ago
    i get the feeling you have known this for quite a while ;)
  - dualogy 13y ago
    > Did I just realize that all money in our current form is credit and I never actually own anything? You own whatever you exchange your money for, in the simplest terms. Even if it's a bitcoin or a "financial security" or a share or a chunk of gold, or indeed a pork-belly, an iPad etc. etc.
    - sitkack 13y ago
      It is actually the credit aspect I just started to understand. Money represents credit. Just like politics, you can ignore it but you can't escape it.
      - penguindev 13y ago
        Try this on for size: How The Economic Machine Works by Ray Dalio https://www.youtube.com/watch?v=PHe0bXAIuk0 https://www.youtube.com/watch?v=PHe0bXAIuk0 in particular, see the graph of total domestic debt (i.e. credit) to gdp, and how they have short and long term cycles.

bradleysmith 13y ago

it would mean a distributed work-based hashing process would be the determinant of money supply of the world reserve currency. The world reserve currency is the US dollar. Even if a central bank holds gold as a store of value, they price it and their own currency in the US dollar. If any commodity was to be labeled a de-facto 'world currency' it would be petroleum, as it is a commodity that everyone MUST purchase in some fashion. The monetary supply of the US dollar is determined by the Fed, which has no oversight from or obligation to the countries which that monetary supply affects. It's clear moral hazard, on a global scale. people would still use fractional reserve lending, and credit. But, no one sovereignty would be in control of the supply of the the medium of exchange they used. I'm not arguing it would improve anything, but it would certainly be different.

penguindev 13y ago
We already had, in essence, a 'proof of work' system with gold. Gold supply increases by only a percent or two per year, and it is highly resource / energy intensive. And note that many central banks, including US, China, Russia, have and /or are even adding to their gold reserves. (Ben Bernanke says it's for 'tradition' - cough, cough, eye roll, cough) But as JP Morgan said, "gold is money. everything else is credit." Banks don't care about the underlying reserve money as long as they control the credit, which gets used as if it were money. >but it would certainly be different. I don't see how. And even if it were, the powers that be like things just the way they are.
- DanBC 13y ago
  > We already had, in essence, a 'proof of work' system with gold. Gold supply increases by only a percent or two per year, and it is highly resource / energy intensive. But the people doing a lot of the hardest dangerous work get very very lite for doing so. Money is made by pushing buttens at the right time to move numbers around a network.
  - sliverstorm 13y ago
    the people doing a lot of the hardest dangerous work get very very lite for doing so Same story with bitcoin, though the physical onus is removed.
  - penguindev 13y ago
    >Money is made by pushing buttens at the right time to move numbers around a network. Yes, and that's probably not going to ever change, not sure what your point was.... But here's where people get REALLY rich. Banks financing government debt (pushing a button, as you say) which is cosigned by 300 million of us serfs, for stupid unsustainable shit like wars and welfare. The banks and credit masters win, and the rest of us are FUCKED. PS guns and butter was what led to the end of the gold standard. If you think bitcoin is going to somehow stop governments from over spending, or banks from over lending, foreclosing, and buying assets for pennies on the dollar, you need a history lesson.

dualogy 13y ago

> Don't you hate it when people conflate money with credit Is it any wonder? Any medium-of-exchange immediately becomes credit -- a claim on some unknown-person's future offering of something. Everything else more-complicated derives from this inherent money-is-a-claim characteristic IMHO. The medium truly is the claim, aka credit.

sitkack 13y ago
Did I just realize that all money in our current form is credit and I never actually own anything? And whom ever controls the biggest source of credit controls the value of the "money" in my pocket at anytime? The only truly valuable thing is experience.
- drstrangevibes 13y ago
  i get the feeling you have known this for quite a while ;)
- dualogy 13y ago
  > Did I just realize that all money in our current form is credit and I never actually own anything? You own whatever you exchange your money for, in the simplest terms. Even if it's a bitcoin or a "financial security" or a share or a chunk of gold, or indeed a pork-belly, an iPad etc. etc.
  - sitkack 13y ago
    It is actually the credit aspect I just started to understand. Money represents credit. Just like politics, you can ignore it but you can't escape it.
    - penguindev 13y ago
      Try this on for size: How The Economic Machine Works by Ray Dalio https://www.youtube.com/watch?v=PHe0bXAIuk0 https://www.youtube.com/watch?v=PHe0bXAIuk0 in particular, see the graph of total domestic debt (i.e. credit) to gdp, and how they have short and long term cycles.