So, you're telling me, people with crappy fiat collect less-crappy fiat?
They're just a wrung down the ladder. International bag holders.
Discussion
Yes. Because most people value liquidity above all else. USD is far from crappy. It has a huge capital market, it can be exchanged for fuel or any physical good. Try trading gold or bitcoin for food. Look what people did in Lebanon and Venezuela.
That makes fiat an efficient trading token (as I pointed out), not an efficient store of value (collectable).
A store of value is meant to retain its long-term purchasing power. That's why its a "store".
My argument is that people don't care how efficient it is, as long as it's liquid enough.
Poor people, maybe.
They're poor compared to an average person in the US, sure. How does it negate their reasoning?
It doesn't.
Their behavior says nothing about what they think is a SoV because they don't really store anything.
Might be the clearest demarcation of the divide between rich and poor. Rich care most about SOV, poor about MOE.
Bitcoin (assets) are money for the rich, the dollar (fiat) is for the poor. That’s why if you trade your bitcoin for dollars, they say, “HFSP!”
Yeah, gamblers and poor people trade in hard assets for currency. Rich people just accumulate assets and largely ignore price movements.
They're thinking past the currency collapse.
We're basically completely out of fiat. Have enough for 3 months expenses and the rest is in appreciating assets.
We're done being poor. 😂
The smartest people in Lebanon and Venezuela put all of their local fiat immediately into gold and Bitcoin long ago, and they're now wealthier than before.
They can liquidate parts of their SoV in bits, to have trading tokens to tank their car and buy gasoline.
I'm not trying to criticize your argument just for fun. I'm quite interested in those mini collapses. And AFAIK from YouTube and similar evidence, most people choose USD. Perhaps the super wealthy have the luxury of holding gold and bitcoin, but the common folk choose USD.
Probably as more to do with savvy and future-orientation, than wealth, but those things correlate.
You have to look at their personal monetary velocity. If someone only saves enough money to cover a month's or even a year's worth of personal consumption, then he won't care about SoV, because he's using up the trading tokens quickly or could dump them fast by buying an expensive consumption good, like a car or a laptop.
But someone who traded Lebanese Lira in 2019 for USD, and then saved it, is now down 20% in purchasing power, over gold. Not bad for a trading token, but that's a fifth in 4 years and USD inflation has barely even happened, yet. How will they feel when they start losing a fifth every year or even every month?
At some point, you have to wisen up and see the USD as the Last Viable Trading Token and start exchanging it for durable goods, or you're just being silly.
If they all have USD, now, then they can easily trade in those USD for something harder.