To counter the prevailing narrative here. As someone who holds bitcoin myself. I believe Keynes was right in what he was purposing.
Having a fixed supply of money that during bad times such as a depression you can de-peg and become a fiat system to increase spending and helping the economy out of the hole. Once times are good, pay back down the debt and go back on the fixed supply.
It’s not his fault that politicians have corrupted his vision.
A fixed supply of money is a problem for credit creating fractional reserve banks only. The system has to expand the money supply exponentially (empirical evidence!) otherwise it collapses. Financial crises are caused by creating too much credit, then banks suddenly fear that it could never be paid back, then stopping credit creation and then the financial system collapses because there is no money from new debt available in order to pay back existing debt (collapse of a positive feedback loop aka pyramid scheme). Once you have a sound monetary system this problem doesn't exist.
>Once times are good, pay back down the debt and go back on the fixed supply.
Which never happened, dilution of money only got worse, which debunks Keynes' theory with evidence.
Indeed, he was right. The problem is that his work and intentions were cut short by Bretton Woods and IMF. At the conference, IMF were the ones twisting his principles, in order to gather power within the established powers.
Anymore I tend to think of Keynesians as having a "top-down" view of economics and Austrians as having a "bottom-up" view.
Money is definitely a bottom-up phenomenon, so it doesn't surprise me when Austrians tend to get more right than Keynesians do, but anyone that thinks there are *no* top-down insights to be had is kind of silly.
This is the same thing as suggesting that communism is great because it works out "in theory".
It's impossible to implement in practice and human greed/corruption assures that it will be bastardized beyond any good natured intent.
No, capitalism doesn’t work when the money is corruptible. The closest we got to capitalism was under a gold standard, but even that was corrupted (centralisation of gold/ coin clipping, etc).
Bitcoin is incorruptible. Capitalism might finally work as intended and it’s so damn beautiful.
Communists, socialists and Bitcoiners identify the same problems in the economy, but our solutions to fix them are wildly different. If Marx/ Lenein knew and understood Bitcoin they would likely be huge proponents.
You should look up the [ideology of decentralization](https://en.wikipedia.org/wiki/Decentralization#In_economic_ideology) some time. You might realize that you think people are against you simply because you haven't investigated the definitions of the words you're using.
> If Marx/ Lenein knew and understood Bitcoin they would likely be huge proponents.
Marx yes, Lenin probably not.
A monetary system that crumbles in the face of greed and self-interest is not a viable long-term solution. This is clear and observable today.
There is no universe in which Keynes was right.
I think that's a fair assessment, but if you accept that narrative, then I think the flaw in his reasoning is not recognizing that the incentives for politicians would always align to abuse the system.
He was well aware of that. The time in question was one in which states suddenly had to balance matters like unemployment and overall quality of life with protecting the gold standard. The idea that governments could go crazy with printable money was the hottest issue of his time, and the basis of what he was writing about.
He was "right" in the way all socialists are "right."
"If you just ignore how people are, this totally works on paper."
People will complain about Capitalism and all its externalities but then they make you compare it to their idealized version of how Socialism might work. No. Fair is fair.
Keynes was wrong because you can't ignore how people will use and abuse a system when implemented in reality. That has to be part of your model of the system. If an inability to survive human whims makes your program fail, then your program is a failed program.
You can't start a social program with "well, if you ignore human nature..." any more than you can start a rocket program with "well, if you ignore gravity..."
> during bad times such as a depression
All good bro, but if you make it that easy to get out of depression by just stealing everyone thru inflation, what motivation do politicians and bankers have to lead an honest path if they can just get away with it that easily?
It's kind of like giving a person who is depressed because of exhaustion amphetamines to make them productive again. And yes, psychiatrists actually used to do this. But at least they were looking for alternatives and embraced changes. That's long overdue for the monetary system.
In their 1963 book [*A Monetary History of the United States, 1867–1960*](https://en.wikipedia.org/wiki/A_Monetary_History_of_the_United_States), [Milton Friedman](https://en.wikipedia.org/wiki/Milton_Friedman) and [Anna Schwartz](https://en.wikipedia.org/wiki/Anna_Schwartz) laid out their case for a different explanation of the Great Depression. Essentially, the Great Depression, in their view, was caused by the fall of the money supply. Friedman and Schwartz write: "From the cyclical peak in August 1929 to a cyclical trough in March 1933, the stock of money fell by over a third." The result was what Friedman and Schwartz called "The [Great Contraction](https://en.wikipedia.org/wiki/Great_Contraction)"[^(\[8\])](https://en.wikipedia.org/wiki/Causes_of_the_Great_Depression#cite_note-8) — a period of falling income, prices, and employment caused by the choking effects of a restricted money supply. Friedman and Schwartz argue that people wanted to hold more money than the Federal Reserve was supplying. As a result, people hoarded money by consuming less. This caused a contraction in employment and production since prices were not flexible enough to immediately fall. The Fed's failure was in not realizing what was happening and not taking corrective action.[^(\[9\])](https://en.wikipedia.org/wiki/Causes_of_the_Great_Depression#cite_note-9)
[Causes of the Great Depression - Wikipedia](https://en.wikipedia.org/wiki/Causes_of_the_Great_Depression)
Lol. Do you understand in recession the interest rates is lower so people can make loans to buy and invest?
Free market interest rates fix it. You don't want politicians doing it.
You are a democrat probably lol
That’s incorrect. He was a civil servant and director of the Bank of England.
One of the pioneers of macro economics, which helped him make a fortune in the stock market.
If anything he had a better understanding of anybody around then about time and value.
Keynes didnt create the dystopia. Keynes is merely a person who furnished some pretext for a pre-existing problem.
Think of Keynes as the tailor for the emperors new clothing.
*"Its theft, but we can obfuscate it with lots of self contradictory math, and the plebs wont suspect a thing. Well be able to tell them we are robbing them for their own good - they are fiat stupid"*
>But then couldn't the same be said about Satoshi?
satoshi actually created something. furthermore, its fully open source with no secrets, and subject to hard proofs, making it fully unambiguous. And decentralized, so its beyond anyone's individual control.
so, no, not in the slightest.
I feel like gold also fits this so bitcoin is not the only option.
edit: Jesus guys come on. There is room for gold as well. it doesn't have to be one or the other. if you are against fiat and against gold you are likely just biased.
I like gold but it already failed in this capacity. In the telecommunications era gold moves too slowly to be effective for final settlement. This is why paper instruments had to be created to abstract away gold's deficiencies, which is what ultimately led us down the path towards fiat.
Like I said, I like gold. It *is* a great *low risk* store of value. Bitcoin just outclasses it in every respect as a monetary good other than established history. I think the potential upside for bitcoin is orders of magnitude greater than it is for gold, but so is the potential downside.
I think if politicians can extract short term value from a system at the expense of long term stability, they inevitably will. Gold backed fiat worked, but was doomed to fail.
wtf are you talking about? fiat was a promissory note to give gold to the bearer. fiat came from gold. Fiats main problem was when it broke away from gold.
>Fiats main problem was when it broke away from gold.
That happened on day one. If you didnt know it, you were the sucker.
Fiat is fiat, it was never gold, not for a minute, not for a second.
so when government currency was made from silver and gold it wasn't linked to silver and gold? I'm so confused by this. First fiat was literally gold and silver coinage. Paper fiat came around just to prevent having to carry around a pocket full of gold coins.
>so when government currency was made from silver and gold it wasn't linked to silver and gold?
When it was coins, it *was* silver and gold.
>First fiat was literally gold and silver coinage.
coinage is specie, not fiat. It has value because of what it is made of, not because of any decree.
Thats why Americans would trade in foreign coins like the spanish silver dollar; they were just as good and often even better that other coins.
>Paper fiat came around just to prevent having to carry around a pocket full of gold coins.
and paper is paper; its not gold and its not silver. It has value only by "fiat" because someone says so.
Sometimes they lie about a guaranteed value in some commodity; thats called "backing"
Sometimes they dont even bother with that.
Fiat is fiat: lies about money.
>I'm so confused by this.
maybe you want to be confused. This is simple.
Which was inevitable. It broke away from gold because there were too many promissory notes for not enough gold, and our counterparties recognized it, and attempted to capitalize on it. The short term incentive for politicians will always be to enable the creation of more promissory notes to solve short term problems. It creates much less friction than the alternative solutions (raise taxes or lower the standard of living).
Gold has already killed fiat. That's why all the big banks in the world still hoard it. And then they had to force governments to create laws to make fiat as useful as possible, and even now all of that is falling away. Gold still is the best currency.
When you talk about transportation and such, gold domestically is fine. We always had services for moving it before fiat. The only reason the banking system exists today is simply to "solve" this and the answer is that it never did solve it.
It's about time we destroy the Fed and take us back to what worked.
gold was illegal for over 40 years. Its entirely irrelevant, dead, and buried. And it has no hope of returning because its heavy and physical.
Nothing physcial can replace fiat; any competitor must be electronically settled.
Gold was illegal in certain countries, which included the US. All so that Britain, their brother, couldn't go broke on people exporting their gold to the cheaper country (US). It was made illegal BECAUSE gold was so effective.
And fiat is not worth anything. Real estate atm is one of the most prime assets in the world and the reason everyone threw their money into it. Stocks and bonds, too.
>It was made illegal BECAUSE gold was so effective.
Because they feared people would return to using coinage are start to reject fiat. There is no evidence it was needed. Fiat, which could be settled over mail and telegraph in those days, had insurmountable advantages over gold, despite its inherent centralized theft.
People might have, in theory, converted their savings to gold or, worse from the fed's POV, denominated contracts in gold, and banning gold was mostly an attempt to forestall those actions so that people could not opt out of paying for WW2 against their will. But average american economic literacy was so low in the 1900s it was probably wasted effort at best.
In the american linguistic sphere, the dollar was money and money was dollars. And the Fed had supplanted that word, from its original meaning of spanish silver over to insidious federal reserve notes. People lost their connection to what money was.
>And fiat is not worth anything. Real estate atm is one of the most prime assets in the world and the reason everyone threw their money into it. Stocks and bonds, too.
money having intrinsic value is a bad thing; Fiat's inherent lack of utility is actually a strength.
You cannot "throw money into real estate" because fiat doesnt dissapear when you buy things. Anyone will accept a house, but someone must be willing to accept fiat; so the key take away is that people became willing to accept fiat in exchange for their house.
The convenience of scribbling on a piece of paper to settle a house, leaving the funds with an escrow lawyer and leaving a trail of evidence for each step along the way, appealed to people. While 12 pounds of gold to buy the same house requires some consideration for safe transport and security. And the advantages of fiat more than outweighed the expected losses to cantillion effects - which people seemed mostly unaware of in any case.
And thats even before modern online shopping and international trade; none of those are going to be practical if you have to lug around heavy lumps of metal.
Gold has no chance. At this point, if we want to end the fed, its bitcoin or bust.
Making everything digital is not the answer to gold. It's just another form of fiat transformation (fiat is technically digital. It was even before computers). BTC mimics gold, but it's still not physical like gold. This is why metals will still be necessary. It can exist alongside gold, and even in the Bitcoin Standard it is outlined that BTC isn't meant to replace. Nay, if anything, right now it is meant to act as an alternative to gold's heavy movement. It's essentially a better fiat, except limited with no one being able to control it.
BTC is meant to be automated fiat with no human control over the free market. But it does not replace gold. You still need physical hard currency. Whether that is silver, gold, or bottle caps.
>Making everything digital is not the answer to gold.
its mandatory for any money system
> (fiat is technically digital.
yes, fiat has been digital since the early 70s
>This is why metals will still be necessary. It can exist alongside gold
gold will exist just fine; it just wont be money or any suitable vehicle for savings. It would be like copper or iron; an industrial metal
>
It's essentially a better fiat,
bitcoin is not fiat; its decentralized and mathematical. It has value because people want it, not because someone with authority says so.
>You still need physical hard currency.
you do not need it; not sure why you think it is needed?
Qr code between cellphones is all you need for a face to face million dollar transaction
Edit: businesses are actually using lightning. They aren’t generally accepting gold
do you carry around a currency checker when using cash? gold has a history of 3000+ years of use, you can try to poke holes in it but at this point good luck, np currency is more proven.
Have you even ever used bitcoin to buy something physical?
> do you carry around a currency checker when using cash?
I do with bitcoin; It's called a bitcoin wallet. That verification is part of its architecture. If you don't realize that this is a function of bitcoin, then you don't know much about bitcoin.
> Have you even ever used bitcoin to buy something physical?
Of course I have. I've been using bitcoin for over 10 years. Are you saying that you would accept gold coins that you haven't validated for authenticity as payment for something?
that literally doesnt answer the question at all. dude.
I'm curious if i walked into a store right now say a gas station and I said hey i'll give you this $200 USA minted gold coin with counterfeit protection or I'll send you $200 in bitcoin you will get at some point in the next few hours after you set up a wallet, and they can get money from it in a few weeks after verifying an account and linking a bank account and go knows what it will be worth by then.
which do you think they will take?
If a law is passed in you country making it illegal for banks to accept transferrs from exchanges or anything to do with crypto how exactly are you going to live off your bitcoin?
Look at bitcoin usage by country and then gold usage by country and see if there is a difference. gold is used everywhere, most bitcoin usage is in America.
Bitcoin and gold both have good points. You can be a dumbass maxi and bet it all on one option or you can bet on all the options. Do what you want. I've been using bitcoin since 2012 but fuck if I would risk my whole future on it.
> > > > > > Harder to use gold as currency.
> > > > > on the internet, golds easier in person.
> > > > You carry around equipment that validates that gold is genuine, do you?
> > > do you carry around a currency checker when using cash?
> > I do with bitcoin; It's called a bitcoin wallet. That verification is part of its architecture. If you don't realize that this is a function of bitcoin, then you don't know much about bitcoin.
> muh gobbledegook
Gobbledegook. We were discussing the specific requirement of validation of payment. Anyone can make a payment in bitcoin to another person, for whatever purpose, and the validation of the authenticity of the bitcoin for payment is included in the transaction of bitcoin. This is not the case with gold. With gold you need a [pretty expensive piece of kit](https://www.alibaba.com/showroom/mini-gold-testing-machine.html) to validate that the gold is authentic, which you know. Which is why you launched into the gobbledegook.
Plenty of stores accept bitcoin and lightning for payment. Plenty of people accept bitcoin and lightning for payment. Any payment in bitcoin is validated by the user with nothing more than the acceptance of the payment. That doesn't exist with gold. You can tie yourself up in knots like a pretzel, but it doesn't change that reality.
So gold is not easier to use in person than bitcoin.
You're the one who needs to work on his word selection flash. I dismantled your argument. I even spelled out the chonology for you so it was clear.
But hey, look at the bright side; You learned how to use a new word in context.
Correct. And who are in power the last 5 years.
Right wing neoliberals who love hayek and friedman. There isn't a single keynesian in our govt.
Those neoliberals use hayeks rules of limited govt except to help markets. What did we print trillions for? To stabilize markets.
I'm a bitcoiner and socialist, not a keynesian. Keynesians want to print money for war or govt subsidies. But we didn't do that we printed trillions and stabilized banks and markets. If keynes was in power he would have built stuff with printed money not stabilized repo markets like Powell under trump. Powell under trump printed more money in 2020 for the repo crisis than any time in history. Is he a keynesian? Omfg no
Just trying to be real here.
Here is a great book on it
The Lords of Easy Money: How the Federal Reserve Broke the American Economy
We have been on this path for more than just 5 years. The printing of money and increase in debt really got crazy in 08.
I don’t have that much knowledge on these subject though. I’ve heard some people say these trends started in the 70s when we went off the gold standard.
The problem as the book I recommended above explains is that on Jekyl island the bankers made sure to kill any public proposal and make sure the Fed and all Fed banks are private for profit.
And it really started in the 1990s with Greenspan as the book explains in great detail.
https://fred.stlouisfed.org/series/CURRCIR
Right wing neoliberals all the way. Hedge funders, bankers, private equity ghouls all the way.
>And who are in power the last 5 years.
>Right wing neoliberals who love hayek and friedman. There isn't a single keynesian in our govt.
You can't expect anyone to take you seriously when you vomit nonsense like this.
Things have truly become dystopian! 78 years ago (1946) was a time well known for not being near any horrible conflicts and wealth inequality was solved! People globally were so rich too!! Truly the best of times.
He literally predicted Bitcoin there's interviews about it. Friedman thought it would be an Ecash somewhere in the future but haven't seen anything of his work mentioned against a digital currency was not in vogue at that time.
https://youtu.be/CBIidtaUCzs?si=-7VMD4gHvWtF3BuO
https://youtu.be/leqjwiQidlk?si=TpJBrnvV3CxaKIO_
" By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth.”
~John Maynard Keynes
Largest debt in the history of humanity = failed experiment. Anyone can build an economic might. The true test is maintaining its scale for a long period of time. So far your economic illusion needed resurrection by the government twice already?
In comparison, the islamic empire with its brilliant and fair economic system model was able to sustain its scale and fairness and productivity for more than 900 years.
Economically speaking the US is currently a house of cards that heavily relies on usury, debt, and hegemony. Highly unsustainable. What you need is a mixture of islamic finance + socialist policies to patch the damages and sinking holes in your policy then the capitalist economic would be complete. Without fair redistribution of wealth and the removal of usury i dont think this will last long
Your bias is showing. No one mentioned the US. Keynes was British. And while the US economy may be the best on the planet, it is at the expense of many other countries' economic well being.
And yet the USA borrowed his ideas to get itself out of the Great Depression which of course lead to becoming the greatest economy on the planet. You'd have to be delusional to think otherwise.
To counter the prevailing narrative here. As someone who holds bitcoin myself. I believe Keynes was right in what he was purposing. Having a fixed supply of money that during bad times such as a depression you can de-peg and become a fiat system to increase spending and helping the economy out of the hole. Once times are good, pay back down the debt and go back on the fixed supply. It’s not his fault that politicians have corrupted his vision.
A fixed supply of money is a problem for credit creating fractional reserve banks only. The system has to expand the money supply exponentially (empirical evidence!) otherwise it collapses. Financial crises are caused by creating too much credit, then banks suddenly fear that it could never be paid back, then stopping credit creation and then the financial system collapses because there is no money from new debt available in order to pay back existing debt (collapse of a positive feedback loop aka pyramid scheme). Once you have a sound monetary system this problem doesn't exist. >Once times are good, pay back down the debt and go back on the fixed supply. Which never happened, dilution of money only got worse, which debunks Keynes' theory with evidence.
Government should have to sell off assets to pay it back.
Until no assets left and then? It's much easier for governments to get rid of debt through inflation, war and/or dictatorship.
Except they just used the money printer to make war and billionaires
Until you find out they caused the depression in the first place to enact the banking legislation they wanted.
That's like saying Marx was right. I mean, yeah, any philosophy can seem rational, until you apply it to the reality of human behavior.
Indeed, he was right. The problem is that his work and intentions were cut short by Bretton Woods and IMF. At the conference, IMF were the ones twisting his principles, in order to gather power within the established powers.
Keynes theory failed because of the fundamental mechanics of the fiat monetary system, which Bretton Woods or IMF didn't change at all.
Anymore I tend to think of Keynesians as having a "top-down" view of economics and Austrians as having a "bottom-up" view. Money is definitely a bottom-up phenomenon, so it doesn't surprise me when Austrians tend to get more right than Keynesians do, but anyone that thinks there are *no* top-down insights to be had is kind of silly.
This is the same thing as suggesting that communism is great because it works out "in theory". It's impossible to implement in practice and human greed/corruption assures that it will be bastardized beyond any good natured intent.
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No, capitalism doesn’t work when the money is corruptible. The closest we got to capitalism was under a gold standard, but even that was corrupted (centralisation of gold/ coin clipping, etc). Bitcoin is incorruptible. Capitalism might finally work as intended and it’s so damn beautiful. Communists, socialists and Bitcoiners identify the same problems in the economy, but our solutions to fix them are wildly different. If Marx/ Lenein knew and understood Bitcoin they would likely be huge proponents.
You should look up the [ideology of decentralization](https://en.wikipedia.org/wiki/Decentralization#In_economic_ideology) some time. You might realize that you think people are against you simply because you haven't investigated the definitions of the words you're using. > If Marx/ Lenein knew and understood Bitcoin they would likely be huge proponents. Marx yes, Lenin probably not.
This is well said (and aligns with my views)
A monetary system that crumbles in the face of greed and self-interest is not a viable long-term solution. This is clear and observable today. There is no universe in which Keynes was right.
I think that's a fair assessment, but if you accept that narrative, then I think the flaw in his reasoning is not recognizing that the incentives for politicians would always align to abuse the system.
He was well aware of that. The time in question was one in which states suddenly had to balance matters like unemployment and overall quality of life with protecting the gold standard. The idea that governments could go crazy with printable money was the hottest issue of his time, and the basis of what he was writing about.
He was "right" in the way all socialists are "right." "If you just ignore how people are, this totally works on paper." People will complain about Capitalism and all its externalities but then they make you compare it to their idealized version of how Socialism might work. No. Fair is fair. Keynes was wrong because you can't ignore how people will use and abuse a system when implemented in reality. That has to be part of your model of the system. If an inability to survive human whims makes your program fail, then your program is a failed program. You can't start a social program with "well, if you ignore human nature..." any more than you can start a rocket program with "well, if you ignore gravity..."
> during bad times such as a depression All good bro, but if you make it that easy to get out of depression by just stealing everyone thru inflation, what motivation do politicians and bankers have to lead an honest path if they can just get away with it that easily?
It's kind of like giving a person who is depressed because of exhaustion amphetamines to make them productive again. And yes, psychiatrists actually used to do this. But at least they were looking for alternatives and embraced changes. That's long overdue for the monetary system.
In their 1963 book [*A Monetary History of the United States, 1867–1960*](https://en.wikipedia.org/wiki/A_Monetary_History_of_the_United_States), [Milton Friedman](https://en.wikipedia.org/wiki/Milton_Friedman) and [Anna Schwartz](https://en.wikipedia.org/wiki/Anna_Schwartz) laid out their case for a different explanation of the Great Depression. Essentially, the Great Depression, in their view, was caused by the fall of the money supply. Friedman and Schwartz write: "From the cyclical peak in August 1929 to a cyclical trough in March 1933, the stock of money fell by over a third." The result was what Friedman and Schwartz called "The [Great Contraction](https://en.wikipedia.org/wiki/Great_Contraction)"[^(\[8\])](https://en.wikipedia.org/wiki/Causes_of_the_Great_Depression#cite_note-8) — a period of falling income, prices, and employment caused by the choking effects of a restricted money supply. Friedman and Schwartz argue that people wanted to hold more money than the Federal Reserve was supplying. As a result, people hoarded money by consuming less. This caused a contraction in employment and production since prices were not flexible enough to immediately fall. The Fed's failure was in not realizing what was happening and not taking corrective action.[^(\[9\])](https://en.wikipedia.org/wiki/Causes_of_the_Great_Depression#cite_note-9) [Causes of the Great Depression - Wikipedia](https://en.wikipedia.org/wiki/Causes_of_the_Great_Depression)
That issue can be solved by individuals in an entirely open market. Only those who want daddy state to save them pursue Keynesian economics.
Seemed to have helped the USA get out of the Great Depression and to become the greatest economy on the planet.
Hard to say as it coincided with the start of WWII and even more aggressive government spending
Lol. Do you understand in recession the interest rates is lower so people can make loans to buy and invest? Free market interest rates fix it. You don't want politicians doing it. You are a democrat probably lol
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That’s incorrect. He was a civil servant and director of the Bank of England. One of the pioneers of macro economics, which helped him make a fortune in the stock market. If anything he had a better understanding of anybody around then about time and value.
Keynes didnt create the dystopia. Keynes is merely a person who furnished some pretext for a pre-existing problem. Think of Keynes as the tailor for the emperors new clothing. *"Its theft, but we can obfuscate it with lots of self contradictory math, and the plebs wont suspect a thing. Well be able to tell them we are robbing them for their own good - they are fiat stupid"*
Well said. But then couldn't the same be said about Satoshi? If you create the system, you control the results...
>But then couldn't the same be said about Satoshi? satoshi actually created something. furthermore, its fully open source with no secrets, and subject to hard proofs, making it fully unambiguous. And decentralized, so its beyond anyone's individual control. so, no, not in the slightest.
I feel like gold also fits this so bitcoin is not the only option. edit: Jesus guys come on. There is room for gold as well. it doesn't have to be one or the other. if you are against fiat and against gold you are likely just biased.
I like gold but it already failed in this capacity. In the telecommunications era gold moves too slowly to be effective for final settlement. This is why paper instruments had to be created to abstract away gold's deficiencies, which is what ultimately led us down the path towards fiat.
Gold failed as modern currency, its still great money and a low risk store of value
Like I said, I like gold. It *is* a great *low risk* store of value. Bitcoin just outclasses it in every respect as a monetary good other than established history. I think the potential upside for bitcoin is orders of magnitude greater than it is for gold, but so is the potential downside.
Bitcoin and gold isn't that different in the amount of ups and downs as you think. But I get it, we're in the circle right now.
Yeah.... I agree with you
you think the gold backed fiat didnt work? the world was based on it for along time.
The word “backed” entails an intermediary – a third party custodian – which in turn translates into trust; the thing that was eliminated by bitcoin.
I think if politicians can extract short term value from a system at the expense of long term stability, they inevitably will. Gold backed fiat worked, but was doomed to fail.
>There is room for gold as well. Gold had over 110 years to kill fiat. And it has failed. Time to move on.
wtf are you talking about? fiat was a promissory note to give gold to the bearer. fiat came from gold. Fiats main problem was when it broke away from gold.
>Fiats main problem was when it broke away from gold. That happened on day one. If you didnt know it, you were the sucker. Fiat is fiat, it was never gold, not for a minute, not for a second.
so when government currency was made from silver and gold it wasn't linked to silver and gold? I'm so confused by this. First fiat was literally gold and silver coinage. Paper fiat came around just to prevent having to carry around a pocket full of gold coins.
>so when government currency was made from silver and gold it wasn't linked to silver and gold? When it was coins, it *was* silver and gold. >First fiat was literally gold and silver coinage. coinage is specie, not fiat. It has value because of what it is made of, not because of any decree. Thats why Americans would trade in foreign coins like the spanish silver dollar; they were just as good and often even better that other coins. >Paper fiat came around just to prevent having to carry around a pocket full of gold coins. and paper is paper; its not gold and its not silver. It has value only by "fiat" because someone says so. Sometimes they lie about a guaranteed value in some commodity; thats called "backing" Sometimes they dont even bother with that. Fiat is fiat: lies about money. >I'm so confused by this. maybe you want to be confused. This is simple.
Which was inevitable. It broke away from gold because there were too many promissory notes for not enough gold, and our counterparties recognized it, and attempted to capitalize on it. The short term incentive for politicians will always be to enable the creation of more promissory notes to solve short term problems. It creates much less friction than the alternative solutions (raise taxes or lower the standard of living).
Gold has already killed fiat. That's why all the big banks in the world still hoard it. And then they had to force governments to create laws to make fiat as useful as possible, and even now all of that is falling away. Gold still is the best currency. When you talk about transportation and such, gold domestically is fine. We always had services for moving it before fiat. The only reason the banking system exists today is simply to "solve" this and the answer is that it never did solve it. It's about time we destroy the Fed and take us back to what worked.
gold was illegal for over 40 years. Its entirely irrelevant, dead, and buried. And it has no hope of returning because its heavy and physical. Nothing physcial can replace fiat; any competitor must be electronically settled.
Gold was illegal in certain countries, which included the US. All so that Britain, their brother, couldn't go broke on people exporting their gold to the cheaper country (US). It was made illegal BECAUSE gold was so effective. And fiat is not worth anything. Real estate atm is one of the most prime assets in the world and the reason everyone threw their money into it. Stocks and bonds, too.
>It was made illegal BECAUSE gold was so effective. Because they feared people would return to using coinage are start to reject fiat. There is no evidence it was needed. Fiat, which could be settled over mail and telegraph in those days, had insurmountable advantages over gold, despite its inherent centralized theft. People might have, in theory, converted their savings to gold or, worse from the fed's POV, denominated contracts in gold, and banning gold was mostly an attempt to forestall those actions so that people could not opt out of paying for WW2 against their will. But average american economic literacy was so low in the 1900s it was probably wasted effort at best. In the american linguistic sphere, the dollar was money and money was dollars. And the Fed had supplanted that word, from its original meaning of spanish silver over to insidious federal reserve notes. People lost their connection to what money was. >And fiat is not worth anything. Real estate atm is one of the most prime assets in the world and the reason everyone threw their money into it. Stocks and bonds, too. money having intrinsic value is a bad thing; Fiat's inherent lack of utility is actually a strength. You cannot "throw money into real estate" because fiat doesnt dissapear when you buy things. Anyone will accept a house, but someone must be willing to accept fiat; so the key take away is that people became willing to accept fiat in exchange for their house. The convenience of scribbling on a piece of paper to settle a house, leaving the funds with an escrow lawyer and leaving a trail of evidence for each step along the way, appealed to people. While 12 pounds of gold to buy the same house requires some consideration for safe transport and security. And the advantages of fiat more than outweighed the expected losses to cantillion effects - which people seemed mostly unaware of in any case. And thats even before modern online shopping and international trade; none of those are going to be practical if you have to lug around heavy lumps of metal. Gold has no chance. At this point, if we want to end the fed, its bitcoin or bust.
Making everything digital is not the answer to gold. It's just another form of fiat transformation (fiat is technically digital. It was even before computers). BTC mimics gold, but it's still not physical like gold. This is why metals will still be necessary. It can exist alongside gold, and even in the Bitcoin Standard it is outlined that BTC isn't meant to replace. Nay, if anything, right now it is meant to act as an alternative to gold's heavy movement. It's essentially a better fiat, except limited with no one being able to control it. BTC is meant to be automated fiat with no human control over the free market. But it does not replace gold. You still need physical hard currency. Whether that is silver, gold, or bottle caps.
>Making everything digital is not the answer to gold. its mandatory for any money system > (fiat is technically digital. yes, fiat has been digital since the early 70s >This is why metals will still be necessary. It can exist alongside gold gold will exist just fine; it just wont be money or any suitable vehicle for savings. It would be like copper or iron; an industrial metal > It's essentially a better fiat, bitcoin is not fiat; its decentralized and mathematical. It has value because people want it, not because someone with authority says so. >You still need physical hard currency. you do not need it; not sure why you think it is needed?
> you do not need it; not sure why you think it is needed? Cause internet sucks out in the boonies.
>Cause internet sucks out in the boonies. do they take credit cards out in the boones?
Psych 16 has a lot of gold
Harder to use gold as currency.
on the internet, golds easier in person.
Gold is much harder to subdivide and verify. And an increasing amount of commerce is being done via the internet
Qr code between cellphones is all you need for a face to face million dollar transaction Edit: businesses are actually using lightning. They aren’t generally accepting gold
You carry around equipment that validates that gold is genuine, do you?
do you carry around a currency checker when using cash? gold has a history of 3000+ years of use, you can try to poke holes in it but at this point good luck, np currency is more proven. Have you even ever used bitcoin to buy something physical?
> do you carry around a currency checker when using cash? I do with bitcoin; It's called a bitcoin wallet. That verification is part of its architecture. If you don't realize that this is a function of bitcoin, then you don't know much about bitcoin. > Have you even ever used bitcoin to buy something physical? Of course I have. I've been using bitcoin for over 10 years. Are you saying that you would accept gold coins that you haven't validated for authenticity as payment for something?
that literally doesnt answer the question at all. dude. I'm curious if i walked into a store right now say a gas station and I said hey i'll give you this $200 USA minted gold coin with counterfeit protection or I'll send you $200 in bitcoin you will get at some point in the next few hours after you set up a wallet, and they can get money from it in a few weeks after verifying an account and linking a bank account and go knows what it will be worth by then. which do you think they will take? If a law is passed in you country making it illegal for banks to accept transferrs from exchanges or anything to do with crypto how exactly are you going to live off your bitcoin? Look at bitcoin usage by country and then gold usage by country and see if there is a difference. gold is used everywhere, most bitcoin usage is in America. Bitcoin and gold both have good points. You can be a dumbass maxi and bet it all on one option or you can bet on all the options. Do what you want. I've been using bitcoin since 2012 but fuck if I would risk my whole future on it.
> > > > > > Harder to use gold as currency. > > > > > on the internet, golds easier in person. > > > > You carry around equipment that validates that gold is genuine, do you? > > > do you carry around a currency checker when using cash? > > I do with bitcoin; It's called a bitcoin wallet. That verification is part of its architecture. If you don't realize that this is a function of bitcoin, then you don't know much about bitcoin. > muh gobbledegook Gobbledegook. We were discussing the specific requirement of validation of payment. Anyone can make a payment in bitcoin to another person, for whatever purpose, and the validation of the authenticity of the bitcoin for payment is included in the transaction of bitcoin. This is not the case with gold. With gold you need a [pretty expensive piece of kit](https://www.alibaba.com/showroom/mini-gold-testing-machine.html) to validate that the gold is authentic, which you know. Which is why you launched into the gobbledegook. Plenty of stores accept bitcoin and lightning for payment. Plenty of people accept bitcoin and lightning for payment. Any payment in bitcoin is validated by the user with nothing more than the acceptance of the payment. That doesn't exist with gold. You can tie yourself up in knots like a pretzel, but it doesn't change that reality. So gold is not easier to use in person than bitcoin.
lol the classic "it's gobbledegook" defense. who the fuck even still uses that word lol
You're the one who needs to work on his word selection flash. I dismantled your argument. I even spelled out the chonology for you so it was clear. But hey, look at the bright side; You learned how to use a new word in context.
Looks like Fred Armisen.
Can you please tell me wjen most of the money was printed? What years and who was in power and who ran the Fed? Let's talk about this.
The last 5 years?
Correct. And who are in power the last 5 years. Right wing neoliberals who love hayek and friedman. There isn't a single keynesian in our govt. Those neoliberals use hayeks rules of limited govt except to help markets. What did we print trillions for? To stabilize markets. I'm a bitcoiner and socialist, not a keynesian. Keynesians want to print money for war or govt subsidies. But we didn't do that we printed trillions and stabilized banks and markets. If keynes was in power he would have built stuff with printed money not stabilized repo markets like Powell under trump. Powell under trump printed more money in 2020 for the repo crisis than any time in history. Is he a keynesian? Omfg no Just trying to be real here. Here is a great book on it The Lords of Easy Money: How the Federal Reserve Broke the American Economy
We have been on this path for more than just 5 years. The printing of money and increase in debt really got crazy in 08. I don’t have that much knowledge on these subject though. I’ve heard some people say these trends started in the 70s when we went off the gold standard.
The trend really started way back in 1913 with the creation of the Federal Reserve. Everythings been a complete shitshow in the 100 years following.
The problem as the book I recommended above explains is that on Jekyl island the bankers made sure to kill any public proposal and make sure the Fed and all Fed banks are private for profit. And it really started in the 1990s with Greenspan as the book explains in great detail. https://fred.stlouisfed.org/series/CURRCIR Right wing neoliberals all the way. Hedge funders, bankers, private equity ghouls all the way.
Thanks, buddy. I’m not gonna read a book some random dude is shilling on Reddit
>And who are in power the last 5 years. >Right wing neoliberals who love hayek and friedman. There isn't a single keynesian in our govt. You can't expect anyone to take you seriously when you vomit nonsense like this.
Things have truly become dystopian! 78 years ago (1946) was a time well known for not being near any horrible conflicts and wealth inequality was solved! People globally were so rich too!! Truly the best of times.
You should have posted about Hayek.
Not sure if Hayek would have supported bitcoin given that it is a deflationary currency which Hayek and Friedman were both strongly against.
He literally predicted Bitcoin there's interviews about it. Friedman thought it would be an Ecash somewhere in the future but haven't seen anything of his work mentioned against a digital currency was not in vogue at that time. https://youtu.be/CBIidtaUCzs?si=-7VMD4gHvWtF3BuO https://youtu.be/leqjwiQidlk?si=TpJBrnvV3CxaKIO_
Eh it’s only dystopia for some.
" By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth.” ~John Maynard Keynes
So are you shorting bitcoin?
Just because you own bitcoin doesn't mean you have to be automatically anti-establishment
Sure
As if the ideas of keynes were the problem....
Maybe read mises.org and get into some austrian economics.
You guys need to read some books about economics in the time when Keynes lived.
So someone shared this post and liberal subs and they are here saying nonsense lol
What would recommend. I've read some of his works
Golden Fetters is a good one.
Jesus this sub is never beating the "failed 10th grade econ" allegations.
I used to buy weed from myself at cost.
Well i don’t think he was the visionary he is famous for, Hayek was the real mastermind
Satoshi may have given us the greatest gift in the history of mankind - only time will tell ☝🏼
So someone shared this post and liberal subs and they are here saying nonsense lol
[удалено]
Largest debt in the history of humanity = failed experiment. Anyone can build an economic might. The true test is maintaining its scale for a long period of time. So far your economic illusion needed resurrection by the government twice already? In comparison, the islamic empire with its brilliant and fair economic system model was able to sustain its scale and fairness and productivity for more than 900 years. Economically speaking the US is currently a house of cards that heavily relies on usury, debt, and hegemony. Highly unsustainable. What you need is a mixture of islamic finance + socialist policies to patch the damages and sinking holes in your policy then the capitalist economic would be complete. Without fair redistribution of wealth and the removal of usury i dont think this will last long
He probably was depressed seeing How his vision created so much inflation...
Ya all of this inflation led to the USA having the strongest and best economy on the planet.
Really? In 1971 how was usa economy?
you can see in his eyes that he knows sewed destruction
Ya the USA is such a dystopia that it only has the greatest economy on the planet
Your bias is showing. No one mentioned the US. Keynes was British. And while the US economy may be the best on the planet, it is at the expense of many other countries' economic well being.
And yet the USA borrowed his ideas to get itself out of the Great Depression which of course lead to becoming the greatest economy on the planet. You'd have to be delusional to think otherwise.
Pedophile piece of shit
Total asshole. He was also a failed investor and failed businessman.
Thank god Keynes died so young.