If prices keep falling what happens to commodities such as wheat .. who will produce them ? ..and why ?
I’m writing this because I keep getting asked to comment on Saylor/Saif video even though my position hasn’t changed.
The natural state of the free market is deflation which means all prices fall forever in Bitcoin (assuming it stays decentralized and secure)
Free market economies are more productive meaning faster deflation (or real wealth gains by falling prices)
That system is incompatible with an inflationary monetary system meaning one of those systems must fail.
Either:
1) A system based on truth, hope, and abundance for all 8 billion people on the planet driven by a free market economy and all prices fall relative to bitcoin forever. This means Bitcoin is used as a medium of exchange and freedom tech spreads to the world through lightning, Liquid, Fedimint, Cashu, etc.
OR
2) A control system. An extractive rent seeking system that is NOT the free market (similar to the one we have had for 5000 years that resets every 100 or so years through war) continues to centralize by having you believe price of bitcoin is going up in fiat which makes the surveillance state stronger. This eventually centralizes Bitcoin - custodians, media, regulation (funded from the same manipulation of money) where it is attacked from layer 2. (Similar to gold)
While these ideas may “seem” compatible in the short term because you want Bitcoin to go up in fiat. What it really means is that you are giving your energy and strength to the system centralizing the world by converting Bitcoin to Fiat….to then measure prices.
Quite simply - If Bitcoin is only a store of value, it fails as a store of value.
Ps - It won’t fail. #1 is inevitable in time because too many (and more each day) have seen behind the curtain and are determined to build path #1.
Many of you here - the people that inspire me every day. You make a difference with every word, thought and action.
Almost did that in all caps per nostr:npub1qny3tkh0acurzla8x3zy4nhrjz5zd8l9sy9jys09umwng00manysew95gx because it’s so important.
Referring to # 1 above…..There is no second best.
Discussion
Prices keep falling because producers find ways to produce at lower costs and sell at lower prices. Wheat will always cost something to produce and on top of that is dependent on yearly weather patterns. As long as there is demand for bread, it will be worth it to produce at some volume. The current market signal of wheat is mangled beyond recognition where I’m from in the name of stomping out volatility, which is marketed as the villain. Crops have good and bad years. There should be volatility. But then the factory, built on the fairytale of stable wheat price suddenly can’t survive, because all the slack has been optimized out of its operations. Then the government is ‘just trying to save jobs’. There’s a whole chain of interventions that each tries to fix a side effect of the previous intervention. We are so deep into this, that it colors everything.
Anyway, prices don’t just fall to zero, except for things we no longer want or they fall into a basket of a bigger thing and don’t exist as seperate products anymore. In all other cases, someone is charging you something, even if it’s not money.