Dollars trend toward zero long term
Bitcoin trends toward infinity long term
Choose wisely
Discussion
High vs. low time preference. Listen to #[7] talk about how they use bitcoin in their business.
Dollars you are incentivized to spend because they decrease in value year over year.
Bitcoin you are incentivized to save because they increase in value year over year.
This is not linear but on an average 200WMA it only goes up. Ie 4yr cycle
You’re more incentivized to keep them because no onr accepts it as currency (it’s fake money.)
This is one of the points we’re curious about. We don’t understand why anyone would spend bitcoin if the economics of bitcoin (assuming it will increase in value significantly) only give you incentives to keep it/not spend it.
So how do you actually create a circular economy if there is no incentive to spend?
It’s a good question.
It’s a shift in thinking. In the fiat system you borrow money now to spend and become in debt. You do this because the cost of good increases over time, so you must spend now.
In bitcoin, you save first and accumulate the capital needed to purchase the good or service first. When my savings increase in value enough, you buy the newer car you need or whatever. You do this because goods and services become cheaper over time.
Now why would a spend it. Well you still need to eat, have housing, pay bills, go on vacation and all the things you want to spend money on. You just save it first and are prudent because you have to decide if the opportunity cost is worth the product or service.
Over time the the big wings will lessen and it will become more stable but as long as demand for bitcoin is greater than fixed supply price will go up in terms of dollars. Dollar supply is always expanding while bitcoin supply is on a fixed distribution.
What makes you think bitcoin will trend to infinity?
I think he’s saying that because it has natural scarcity. But he doesn’t know anything about currency so he doesn’t realize that guarantees stagnation over time.
If by trending toward infinity, you mean it’s radically deflationary, then sure lmao
Yeah. I also find this problematic.
Technology is deflationary but is fighting the tide of monetary expansion.
Read ‘Price of Tomorrow’
It’s always some esoteric book with you people. You should be able to make a case in your own words.
I did in my statement prior
Technology gets cheaper over time while also getting better(faster,smaller), for example computer chips and computers in general. Technology also make information cheaper, like what Napster and now Spotify did to music. This is what I mean by technology is deflationary. But at the same time you have monetary expansion which causes inflation, prices go up. So you have two opposing forces. Now bitcoin is technology of money it is also deflationary because it is scarce. Scarcity in money creates abundance everywhere else. Abundance in money creates scarcity everywhere else. That’s why ppl use a house as a savings or investment because the money is abundant and depreciates in value over time so you can save in dollars.
Do you know why technology gets cheaper over time?
technology gets cheaper over time because of inflation.
explaining in brass tacks:
- technology gets cheaper as time goes on because of inflation, such that:
- in order for a publicly traded company to maintain "we're in business!" it has to continually cut costs, while attempting to add either value or perceived value in its products.
- the problem here is of course, the technology didn't actually get less expensive, it just got cheaper in the quality of the product, due to having to remain competitive with inflation. concurrently, the product also remains about the same cost, but the dollar has had much more printed, so ultimately the cost of acquiring a said thing, goes up as there is more money around making it less valuable.
-scarcity in money does not create abundance. it creates people starving.
No, things get cheaper to produce because technology improves labour and efficiency. Ie farming a 1000 acres by tools manpower alone, is slower and more costly and provides less yield that farming 1000 acres with machines.
Information technology makes things cheaper for example the music industry used to have to produce, ship and sell vinyl or cds etc now it is done over streaming. Now you can listen to unlimited music for $10 a month vs a CD, 20 yrs ago cost $15-20 ish dollars.
So technology makes things cheaper in spite of monetary inflation driving prices up.
People starve because of hyperinflation by their corrupt leaders which is a direct result of inflating the money supply. Many many examples of this around the world, Zimbabwe, Peru, Chile etc etc which undermines people’s ability to save and pay for food and services as they could double in price over night.
technology improving labor peaked in the electro-mechanical age.
after that, it was about the boss cutting employees and total man power hours, gradually over time to meet profit margins for the company. nothing more .
- farming with no till methods and traditional means is actually more effective (higher nutritive value, better results,) than monocropping and typical petro-chemical agri-business. There is a decade or so of research and reading backing up this claim. Eating poisoned, fastly produced food is a long lasting error.
information technology makes the overall process more efficient, but guess what? the musicians dont see any of that money. it's not much better with streaming.
Example from the CD era.
when TLC went multi platinum with their album that had waterfalls on it, they only saw 16 cents per album sold. Between the group of them, each one made about 66,000$ on that album. Which is horrific, considering as you said cd's used to cost between 16-22+- USD.
as far as streaming goes, royalty contracts aren't a lot better there, and most artists have turned to either direct sales, or things like bandcamp, which aren't great but an option certainly for those that don't have a tech inclined friend.
~
as far as hyperinflation goes, that's a complicated topic and if govt wasn't corrupt shitheels it wouldn't even need be discussed.
Bosses cutting labour to improve profits is a separate issue.
My statement is true technology makes things cheaper. I could give tons of examples of technology making things cheaper. Recent technology such as drones, in films they used to use helicopters for arial shots, now you use a drone for a fraction of the cost, also for arial survey, etc.
I said make it cheaper not “better for artists” the reason it hasn’t been good for artist is more because of the highly restrictive record label contracts where artists don’t even own the rights to their own music. Once artists can stream directly to their audience without the need for a flat form like Spotify then they can retain their rights and not get raked over the coals by record labels.
Lolwut
Look at a long term chart of the purchasing power of USD the trend is down forever.
Now you’re talking inflation. Which is what I was told Bitcoin was a hedge against a couple years ago. That hasn’t worked out so well
You’re looking at price inflation instead of monetary inflation. Bitcoin responds to the former. In the long term it’s a remedy to both, but if you’re only looking at one year or one halving cycle it’s easy to miss that.
Correction: meant to say latter. As in monetary inflation. Hit post too soon.
Over the short term no, over longer time frames yes.
There is an infinite amount (supply) of cash in the Fed which means that the monetary inflation is infinite which means the value will trend toward zero. Bitcoin work the opposite the supply is fixed therefore your savings cannot be inflated away.
How do you deal with deflation then?
Deflation doesn’t matter if you just hodl.
Deflation is bad in a inflationary system because without growth the system collapses on itself.
Removing monetary inflation allows market prices to be based purely on market supply and demand forces, instead of manipulating market conditions. Goods and services will get cheaper over time just like how cost of technology is deflationary.
It’s a really good question and if you’re really interested in the topic, Price of Tomorrow is a great read doesn’t even mention bitcoin.
Tried telling these fediverse people to read this book yesterday and for some reason it made them angry I recommended a book 🤣
howdareyou.gif suggest a book
What do you mean by the fediverse ? People that haven't a clue is it ?
https://en.m.wikipedia.org/wiki/Fediverse
Mastodon is part of the fediverse and a bridge was built from fediverse to nostr so a lot of people from there are coming over here
I've noticed a lot of people with a mastadon nip identifier and they are all shitheads .
Zero signal.
What makes you say that?
Self righteous , condescending , closed minded , pontificating , contradictory , list goes on .
I actually feel that way about a lot of ppl on nostr, particularly during discussions about crypto.
Whats your hot take on crypto?
It depends what you mean. In general, I just don’t think it solves any problems and instead creates a whole bunch of new ones.
I mean , when you talk to people about crypto , what is it that causes tension?
I think it’s that crypto attracts ppl with a cult mentality. They really don’t like it when you question it.
What your definition of crypto though ? I hate that term .
Cryptocurrencies, including bitcoin.
Crypto is not Bitcoin . Crypto is dogshit .
Bitcoin is a cryptocurrency (well, “currency”). I agree that most of crypto is just a straight up scam though.
Bitcoin is exactly the same as any other cryptocurrency. Any attempt to disassociate yourself from the cryptards is a cope.
Objectively , it's not the same .
Objectively, it is exactly the same. The only difference is you ppl formed a cult around Bitcoin.
You just demonstrated how much you don’t understand either.
Explain how without scamming me with a book.
Bitcoin has no central issuer .
So… exactly like a thousand other cryptocurrencies.
Wow
Why do you think the *checks notes* 22,926 shitcoins exist if not simply as a greed-driven attempt to capitalize on the thing bitcoin has already accomplished?
There are other coins that work on the same principle but have more features or are variants somehow. So it’s not like it’s either bitcoin or crypto trash.
Questions are good , long as people don't get upset by the answer.
What problems does it create?
as presently configured, if we were to switch over to bitcoin tomorrow, and all remaining fiat dissapeared:
- economic scarcity
- a VERY wide gap between haves and have not's
- people hacking the blockchain, finding out where the bitcoin holders live, and robbing them blind so they can eat/pay rent, etc.
- technological barrier to entry. cash or card doesn't require specialized knowledge to operate.
- pretty much the whole world would have to figure out how to live with a fixed amount of currency.
- in short, it'd be like forcing socialism and communism on the entire world.
cc #[2]
Irreversible transactions are a problem generally. People make mistakes. Not to mention all of the scams and fraud, like ransomware.
-Economic scarcity what do you mean by this?
-We currently live is the biggest wealth gap in history, this is not a Bitcoin problem it’s a problem with concentration of power, fed, world bank, central banks, imf, wall st.
-bitcoin blockchain has never been hacked, ppl get robbed for cash, gold, jewelry etc all the time not limited to bitcoin. Bitcoin is arguably a lot harder to steal.
Barrier to entry due to technology is already lowering all the time ppl in Nigeria are sending bitcoin over sms services
Other currency could still exist bitcoin will just be the superior asset
It’s the opposite of socialism what part of it is socialism?
I was thinking along these lines:
Socialism is a political philosophy and movement encompassing a range of economic and social systems,[1] which are characterised by social ownership of the means of production,[2][3][4] as opposed to private ownership.
and yes putting wiki here as i cant easily type out of my early 1990s oxford english dictionary. :)
Using custodial services, defeating the entire point. Same with El Salvador.
exactly what it sounds:
bitcoin will create a HUGE diaspora if it was the only currency going. There will be billions that dont have it (assuming the c19 vax doesn't kill them first,) and there will be only a handfull of people that have bitcoin holdings.
One thing I find intersting is there is a general lack of granularity around how regular people are to attain bitcoins, just lots of literature citing basic laissez-faire concepts, and various marxist ideologies, interspersed with supply side fiat economic principles. they don't translate in a blended situation, or a total changeover.
not sure what you're precisely referring to, or most of the bitcoiners, either.
to me it feels as though an understanding of the current picture, the players, and the dominant situation aren't withstanding, which barrs a probabilistic understanding of where things may actually go or end up.
- power should not be concentrated, that much I agree. Everyone should be able to find land, build a home, and grow their own food and tend to their families, free of governmental policies, or having to buy the land.
- as far as never been hacked? its a computer, brother. dont think for a millisecond that EVERY single thing that happens here, or there on a computer connected to the internet, cannot be discovered, in fine detail granularity.
here's a very overview type article about the blockchain and hacking, very surface level. guy didnt do his homework.
https://www.epiqglobal.com/en-us/resource-center/articles/blockchain-can-be-hacked
Bitcoin is opt in it’s not required.
Give me one example of Bitcoin blockchain being hacked. Do you know what the Byzantine’s General Problem is?
https://futurism.com/blockchains-unhackable-getting-hacked
and so on.
i actually don't find discussing money all that interesting.
its a tool just like a hammer and nails. :)
Lol they hacked Ethereum classic bro no one has hacked the bitcoin blockchain
this may shock you, but I don't actually care one way or the other. :)
and okie dokie. :) hoping you have a lovely day today, and that its already going well.
You hardly know anywhere you can by books like this with Bitcoin ?
That would be savage.
It’s annoying that, when asked to provide an argument in your own words, all you can do is cite another person’s work.
Agree 💯. I’m currently writing about Bitcoin adoption and dollar behavior historically and projected. The central banking system was built to consolidate power to a few; running like a top at the moment.
Save your ink.
#[8] 👆
Okie dokie
Neel Kashkari, president of the Federal Reserve Bank of Minneapolis, said Sunday night on CBS’s “60 Minutes” that “there is an infinite amount of cash in the Federal Reserve.”
From the horses mouth
