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It seems to me that folks who buy Bitcoin are looking at fiat currency and their faith in those who manage it and saying to themselves that globally, they have more faith in the management of bitcoin than the money printing and foolish spending of the greatest sovereigns, let alone the banana republic that we don't tend to think about day to day. That it is a global phenomenon will tend to buoy it up over time, IMO.
That it is limited in supply seems to virtually guarantee the confidence of its purchasers.
It seems the major threat to Bitcoin would be vastly improved government monetary policy. Which does not seem likely in the near future. Yes i think you are correct. Global monetary policy is reckless
The difference between genius and stupidity is that genius has its
limits.- Albert Einstein
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It seems to me that folks who buy Bitcoin are looking at fiat currency and their faith in those who manage it and saying to themselves that globally, they have more faith in the management of bitcoin than the money printing and foolish spending of the greatest sovereigns, let alone the banana republic that we don't tend to think about day to day. That it is a global phenomenon will tend to buoy it up over time, IMO.
That it is limited in supply seems to virtually guarantee the confidence of its purchasers.
It seems the major threat to Bitcoin would be vastly improved government monetary policy. Which does not seem likely in the near future. Good observation. The decentralized nature is a large part of the appeal.
@jameslavish
If you work 40 hrs/wk: at 5% inflation and after 5 years, you need a 28% pay raise or to work 44 more hours (*one full extra week* per month+) to make up the difference.
This is inflation
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Bitcoin and other crypto currencies are not currencies in the normal sense. They are not money because they are not legal tender backed by a government nor are they backed by a riskless asset. They are speculative assets like the Dutch tulip fad or like wildcat bank paper money in the 1830's-1860's. Yes, you can make money investing in them but there will be an inevitable run on their value. Only a matter of time unless legal activities somehow maintain their exchange value. They are indicative though of the movement of finance to shadow banks and unregulated markets because of the high regulatory cost burden we have placed on National and State chartered banks. Bitcoin has ATMs scattered around the country where cash can be withdrawn. Well that the 1st time I ever got an answer as to how you sell a bitcoin for an actual dollar currency. And without asking!
The end of democracy, and the defeat of the American Revolution will occur when government falls into the hands of lending institutions and moneyed incorporations.
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Bitcoin and other crypto currencies are not currencies in the normal sense. They are not money because they are not legal tender backed by a government nor are they backed by a riskless asset. They are speculative assets like the Dutch tulip fad or like wildcat bank paper money in the 1830's-1860's. Yes, you can make money investing in them but there will be an inevitable run on their value. Only a matter of time unless legal activities somehow maintain their exchange value. They are indicative though of the movement of finance to shadow banks and unregulated markets because of the high regulatory cost burden we have placed on National and State chartered banks. Bitcoin has ATMs scattered around the country where cash can be withdrawn. Well that the 1st time I ever got an answer as to how you sell a bitcoin for an actual dollar currency. And without asking! I believe that the amounts per withdrawal are set at 25K$. Stickfight posted some very good info concerning the ins and outs of how to purchase and sell bitcoin.
The degree of my privacy is no business of yours.
What we've learned from history is that we haven't learned from it.
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If Bitcoin becomes the world reserve currency, won't it become a self fulfilling phenomenon? That action would devalue all other fiat currencies, thus stabilizing Bitcoin and assuring its future use and value. What might major global sovereigns do to prevent that? What could they do?
It's hard for me to imagine any sovereign, especially China, being trusted to hold a world reserve crypto currency denominated in their fiat monetary units.
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Atm's are kind of dated. Check this out. https://beta.strike.meI'm not that advanced personally. What I found interesting from Greg's interview was his price valuation and the situation bond traders are in.
@jameslavish
If you work 40 hrs/wk: at 5% inflation and after 5 years, you need a 28% pay raise or to work 44 more hours (*one full extra week* per month+) to make up the difference.
This is inflation
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If Bitcoin becomes the world reserve currency, won't it become a self fulfilling phenomenon? That action would devalue all other fiat currencies, thus stabilizing Bitcoin and assuring its future use and value. What might major global sovereigns do to prevent that? What could they do?
It's hard for me to imagine any sovereign, especially China, being trusted to hold a world reserve crypto currency denominated in their fiat monetary units. Bitcoin will not become the world's reserve currency. No government would allow a private citizen to create a reserve currency anymore than they would go back to a gold standard (as much as some want that). The Fed and other central banks are working on their own digital currency. I think we will have one in the next 10-20 years or so.
The difference between genius and stupidity is that genius has its
limits.- Albert Einstein
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I'll have to give it a listen when I have a chance.
I continue to believe that it is rare to find a traditional finance person who can wrap their brain around crypto and why people find it valuable. Most of it that I have seen from those people is barely a step up from the garbage tier take you can read from the boomers here. Most don't have the first clue about the technical merits and they can't make the mental connection needed to understand the market.
Making up value from thin air should be old hat to these people but when it comes to digital assets they choke. I think their take depends on whether they think the deep state NWO Bolshevik cabal is going to win and push in the chinese yuan flavor of crypto on us as they make our petro dollars turn into toilet paper in their planned takeover of the world OR if the Patriot/Trump plan of a new currency like bitcoin and backed by gold and silver wins and the globalists efforts to keep the prices of metals depressed forever succeeds. If the latter is the case, as time goes on the currency would gain in value as the population increased and the supply stayed relatively stable vs what the dollar does.
Last edited by jaguartx; 04/17/21.
Ecc 10:2
The heart of the wise inclines to the right, but that of a fool to the left.
A Nation which leaves God behind is soon left behind.
"The Lord never asked anyone to be a tax collector, lowyer, or Redskins fan".
I Dindo Nuffin
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If Bitcoin becomes the world reserve currency, won't it become a self fulfilling phenomenon? That action would devalue all other fiat currencies, thus stabilizing Bitcoin and assuring its future use and value. What might major global sovereigns do to prevent that? What could they do?
It's hard for me to imagine any sovereign, especially China, being trusted to hold a world reserve crypto currency denominated in their fiat monetary units. Bitcoin will not become the world's reserve currency. No government would allow a private citizen to create a reserve currency anymore than they would go back to a gold standard (as much as some want that). The Fed and other central banks are working on their own digital currency. I think we will have one in the next 10-20 years or so. I am not sure how they could stop it. All governments are suspect and acceptance is everything. If countries start insisting on crypto payments, then they are in. And, the less fiat currencies are trusted the more likely that seems. It seems to me that world reserve currency favors one nation and it all has to do with confidence. All the other nations have a default reason to favor a neutral, non sovereign cryptocurrency reserve.
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[quote=Milwroad]
Edited to add:
China is now in on the crypto market offering their RMB out on the world market. That is a big factor. China has their crypto first to the market for trading and transactions. They are leading. This could bring bitcoin down in a crash.
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Patriot/Trump plan of a new currency... You really are the grand Poobah of Qanon.
The end of democracy, and the defeat of the American Revolution will occur when government falls into the hands of lending institutions and moneyed incorporations.
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[quote=Milwroad]
Edited to add:
China is now in on the crypto market offering their RMB out on the world market. That is a big factor. China has their crypto first to the market for trading and transactions. They are leading. This could bring bitcoin down in a crash. I don't think people are going to be very trusting of a centralized cryptocurrency controlled by a communist government.
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Campfire Regular
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If Bitcoin becomes the world reserve currency, won't it become a self fulfilling phenomenon? That action would devalue all other fiat currencies, thus stabilizing Bitcoin and assuring its future use and value. What might major global sovereigns do to prevent that? What could they do?
It's hard for me to imagine any sovereign, especially China, being trusted to hold a world reserve crypto currency denominated in their fiat monetary units. Bitcoin will not become the world's reserve currency. No government would allow a private citizen to create a reserve currency anymore than they would go back to a gold standard (as much as some want that). The Fed and other central banks are working on their own digital currency. I think we will have one in the next 10-20 years or so. I am not sure how they could stop it. All governments are suspect and acceptance is everything. If countries start insisting on crypto payments, then they are in. And, the less fiat currencies are trusted the more likely that seems. It seems to me that world reserve currency favors one nation and it all has to do with confidence. All the other nations have a default reason to favor a neutral, non sovereign cryptocurrency reserve. This is where the tulip bubble theory starts to run into problems.
@jameslavish
If you work 40 hrs/wk: at 5% inflation and after 5 years, you need a 28% pay raise or to work 44 more hours (*one full extra week* per month+) to make up the difference.
This is inflation
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Joined: May 2009
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If Bitcoin becomes the world reserve currency, won't it become a self fulfilling phenomenon? That action would devalue all other fiat currencies, thus stabilizing Bitcoin and assuring its future use and value. What might major global sovereigns do to prevent that? What could they do?
It's hard for me to imagine any sovereign, especially China, being trusted to hold a world reserve crypto currency denominated in their fiat monetary units. Bitcoin will not become the world's reserve currency. No government would allow a private citizen to create a reserve currency anymore than they would go back to a gold standard (as much as some want that). The Fed and other central banks are working on their own digital currency. I think we will have one in the next 10-20 years or so. I am not sure how they could stop it. All governments are suspect and acceptance is everything. If countries start insisting on crypto payments, then they are in. And, the less fiat currencies are trusted the more likely that seems. It seems to me that world reserve currency favors one nation and it all has to do with confidence. All the other nations have a default reason to favor a neutral, non sovereign cryptocurrency reserve. Maybe we are talking about different things (if so I apologize) but I do not think any government would want a currency outside of their control. It would make monetary policy impossible. Much like a gold standard. That said there are certainly issues with fiat currencies.In a sense bitcoin is the ultimate fiat currency. Backed by nothing at all. .
Last edited by Milwroad; 04/17/21.
The difference between genius and stupidity is that genius has its
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Campfire Ranger
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If Bitcoin becomes the world reserve currency, won't it become a self fulfilling phenomenon? That action would devalue all other fiat currencies, thus stabilizing Bitcoin and assuring its future use and value. What might major global sovereigns do to prevent that? What could they do?
It's hard for me to imagine any sovereign, especially China, being trusted to hold a world reserve crypto currency denominated in their fiat monetary units. Bitcoin will not become the world's reserve currency. No government would allow a private citizen to create a reserve currency anymore than they would go back to a gold standard (as much as some want that). The Fed and other central banks are working on their own digital currency. I think we will have one in the next 10-20 years or so. I am not sure how they could stop it. All governments are suspect and acceptance is everything. If countries start insisting on crypto payments, then they are in. And, the less fiat currencies are trusted the more likely that seems. It seems to me that world reserve currency favors one nation and it all has to do with confidence. All the other nations have a default reason to favor a neutral, non sovereign cryptocurrency reserve. This is where the tulip bubble theory starts to run into problems. Sorry, but you will need to flesh out your reply for me to understand it. ;-{>8
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Are you referring to my reply or erikj?
The difference between genius and stupidity is that genius has its
limits.- Albert Einstein
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Campfire Ranger
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If Bitcoin becomes the world reserve currency, won't it become a self fulfilling phenomenon? That action would devalue all other fiat currencies, thus stabilizing Bitcoin and assuring its future use and value. What might major global sovereigns do to prevent that? What could they do?
It's hard for me to imagine any sovereign, especially China, being trusted to hold a world reserve crypto currency denominated in their fiat monetary units. Bitcoin will not become the world's reserve currency. No government would allow a private citizen to create a reserve currency anymore than they would go back to a gold standard (as much as some want that). The Fed and other central banks are working on their own digital currency. I think we will have one in the next 10-20 years or so. I am not sure how they could stop it. All governments are suspect and acceptance is everything. If countries start insisting on crypto payments, then they are in. And, the less fiat currencies are trusted the more likely that seems. It seems to me that world reserve currency favors one nation and it all has to do with confidence. All the other nations have a default reason to favor a neutral, non sovereign cryptocurrency reserve. Maybe we are talking about different things (if so I apologize) but I do not think any government would want a currency outside of their control. It would make monetary policy impossible. Much like a gold standard. That said there are certainly issues with fiat currencies.In a sense bitcoin is the ultimate fiat currency. Backed by nothing at all. . I am quite certain governments want control of their currencies, but one gets to be the reserve currency and that gives them a very real advantage. It seems to me all other governments would prefer Bitcoin over a currency that the reserve currency printers can manipulate. If other countries want to be paid in Bitcoin, how does anyone stop it? The gold standard no longer applies, so it seems a very real possibility that Bitcoin could become the international currency of choice.
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Are you referring to my reply or erikj? Sorry, erikj. Got confused, senior moment. ;-{>8
Last edited by oldtrapper; 04/17/21.
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If you mean this let me explain what I was saying.
Bitcoin will not become the world's reserve currency. No government would allow a private citizen to create a reserve currency anymore than they would go back to a gold standard (as much as some want that). The Fed and other central banks are working on their own digital currency. I think we will have one in the next 10-20 years or so.
A reserve currency has to be something all central banks accept for clearing transactions. It also has to be something a responsible (big assumption) government manages to preserve its value. Bitcoin cannot be that because it can be controlled by Mr. Nakamura or whoever is setting up the bitcoin mining algorithms. In addition who knows how many other bitcoin like assets will be created. This can cause the value of any one of these to fluctuate wildly. In other words, bitcoin cannot be controlled. It is the opposite reason why gold cannot be a reserve "currency". It is in fixed supply and not under the control of a government. A fixed supply "currency" has some good characteristics (like keeping a government from over-creating money) but also has severe downsides. It creates beggar-thy-neighbor business cycles, severe liquidity crises like the Panic of 1907 and even deflations like in the 1890s that drove farmers to their knees.
Everyone realizes the inevitability of a conveniently created and transferable digital currency. It also might allow monetary policies that do not favor certain people. For example, when the Fed wants to create "money" it buys assets which typically lowers interest rates. This causes bond and stock prices to rise which creates wealth for people holding those assets but not for people who do not. This can make wealth inequality worse which is not what the Fed really wants. It could create a digital currency by simply adding money to everyone's account (assuming everyone has a digital currency account at the Fed). This might be a better way to conduct monetary policy because it reduces distributional consequences.
So in other words I do not see bitcoin becoming a reserve currency but I also see a digital currency on the horizon in the US. This leaves bitcoin and things like it basically a risky asset and not a currency even though some people will use it to transact, especially those who conduct illegal activities they do not want traced.
The difference between genius and stupidity is that genius has its
limits.- Albert Einstein
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Sorry I missed you post. Please ignore my lengthy epistle on reserve currencies.
The difference between genius and stupidity is that genius has its
limits.- Albert Einstein
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