Dear nostr:npub1s05p3ha7en49dv8429tkk07nnfa9pcwczkf5x5qrdraqshxdje9sq6eyhe ,
I have a question regarding your abundant bread analogy.
In your example the buyer takes all the leftover bread, but I guess he only wants to buy it on a discount. Let’s say I buy all the leftovers for half the price.
Like the miners buy the leftover electricity for less than the market price.
But wouldn’t the baker outprice himself in the moment he sells more leftover bread for half the price than the normal price?
Or the quality of the bread would suffer because he has to cut production cost somewhere to be profitable with the new (half)price.
I hope you can tell me what I’m missing here…
I always enjoy all your podcasts, interviews and talks that I can find. You’re the voice of hope that we need.
Thank you
Kind regards
Thomas
Prices fall to the marginal cost of production in a free market because of the competition.
This is also the reason mining is a hard business. Margins are constantly under pressure from operators finding lower cost energy, compute and efficiency in their operations. Global free market.
Hope that helps.
I think so 😅 I can feel the wheels in my head clicking trying to work it out… it’s like you always say, it’s hard to understand the new system without a reference point.
