An under-appreciated idea of the Austrian School:
The damage is done during the boom. The bust does not destroy wealth, it's just the accounting catching up to the reality.
Bitcoin -$3600. In under 2 hours.
This is not savings, not money, not even currency.
Nothing but a speculation, a casino chip. Will it go up to $100K and beyond? Maybe. I don't know, and neither do the glib voices who assure you it will.
What if I told you that the reason that the governments ended the gold standard was not that it failed, but that it was too successful?
It doesn't allow for cheating. If you cheat, people just pull their money out. Governments wanted to disenfranchise the savers.
Gold exists unconditionally. Not dependant on anything to exist. It exists, even if you disbelieve it. Even if no one pays the power bill.
Bitcoin is conditional on third parties paying the power bill (and other expenses), on the software, etc. It could go out of existence.
Bitcoin down *ANOTHER* 8%. $28.5K
By now, some things should be clear:
1 bitcoin is not money
2 bitcoin does not work as currency, either
3 telling people "not gonna make it" and "have fun staying poor" was not good
4 bitcoin price prognosticators have no idea what will happen
If you add 200mg potassium cyanide to a cup of tea (250 is the typical lethal dose) do you still call it tea? No, it's poison!
If you add a welfare state to economy, requiring high taxation and a central bank, plus regulation, monopoly grants... do you still call it capitalism?
@Brien_Lundin
It's not gold going up, it's the dollar going down. Just about 30mg gold at the end of 2015, now down to around 13mg.
The dollar must be measured in gold. It cannot be measured in euros (i.e. DXY).
@KevorkAlmassian
Fake.
The biggest gold bar is 400oz. Most people can't hold it one handed. A bar the size in the photo would be hundreds of pounds.
Here's a pic of me with a 400oz bar.
@DoombergT
The only thing that amazes me is that on both sides of the aisle, people think politicians can solve engineering or business problems.
Or create energy, whatever they Believe Biden can do. But not approve pipelines, drilling, reduce taxes, cut regulations..
Bitcoin is the only store of value that can leak 10% of the value it stores--in a day.
Don't tell me about the dollar. The dollar takes years to lose that much--and it's designed to go down. No one calls it a "store of value".
Now do literally every other debtor.
Btw, they all pay higher interest rates than the US govt.
Tens of trillions globally. At higher interest rates. By debtors who don't have a captive central bank to finance them.
The US govt is literally the LAST entity to worry about.
If you check your coat at a restaurant, they give you a coat check, a receipt that you redeem to get your coat back.
The coat check receipt is not the coat.
Somehow, people have lost sight of this when it comes to money.
Congress is now talking about taxing unrealized gains. I had a brilliant Super Genius(TM) idea.
Why not tax 6th graders who are going into honors-level middle school tracks? After all, they have potential unrealized incomes!
Why not tax startups on multibillion dollar…
Crypto is nothingness. The way it works is you fork over your money to an exiter. The only money anybody ever made in crypto is by selling it. New buyers are the only source of gains.
Half of Twitter thinks "self" custody fixes it. The other half thinks regulation.
#bitcoin
-10%. In a few hours.
Tell me it's not a store of value, without telling me it's not a store of value.
No, you don't get to say "zoom out". That does not make it into a store. It just means it's been a good speculation so far.
Evolution:
gold coin: no one owes you anything
gold redeemable note: bank owes you gold
1913: the Fed owes you gold
1933: the Fed owes you, but promises not to pay
1971: the Fed owes you nothing
bitcoin: the ledger--no one--owes you nothing
None of these steps is an improvement.
If the Fed is "printing money", and if printing money causes inflation, and if the Fed has done QUITE A LOT of money printing hence caused quite a lot of inflation...
Why is copper cheaper than it was over a decade ago?
Few understand, the US Government will be the *last* entity on earth to default.
Look to every other kind of borrower, first. Especially at the margin. Like commercial real estate.
In the Soviet Union, there was a saying.
"They pretend to pay us, and we pretend to work."
In America today, someone could say "They pretend it's money, and we pretend to save."
Uganda claims it has 31M tons of gold ore, containing 320K tons of fine gold.
That would be over 1% grade. Typical gold grades are single-digit *grams* per ton. This is alleging 1,000 grams per ton.
I call "bullshit".
But yeah, add this to the list of "reasons" to buy bitcoin.
Socialists deny the existence of capital as such. They just see it as something to consume.
A fun experiment: gather a bunch of workers together on a field. Have them make a lightbulb, a wire, a switch, and a generator to power it. Plus fuel to power the generator.
Even the…
We are watching the Europeans, Brits, Australians, Japanese, Chinese and others watch their life savings drip drip drip away.
I could be saying "hey, cool, my upcoming trip will be cheaper in USD!"
Instead, I say: the gold standard fixes this.
I don't know what's worse:
1 a bigoted plagiarist heading America's premier institution of higher learning
2 a Congress with the power to fire university presidents for their views
Volatility precludes use as money.
Dealer sells new F-150 for $69K worth of bitcoin. 2 hrs later, has only $65K to pay to Ford.
"Cope harder"
"Your name is Weiner"
"zoom out"
"bitcoin outperformed gold"
"I am doing fine, I bought in, in 2016"
"HFSP"
Don't address the problem.
If you thought that the Shanghai gold premium is a sign of dollar weakness or it was about gold, you missed the story.
When Chinese buy gold, they have to pay in USD. Which means they first dump yuan to get USD then send USD out of the country. This weakens yuan.…
First comment: MMT is the magical thinking side of socialism.
Second comment: this guy doesn't understand the monetary system. Neither does Stephanie Kelton (who gets a brief clip in this video).
But he is the Chair of the Council of Economic Advisors!
This is absolutely priceless. And probably the most frightening clip you'll ever watch on the people in charge of the US economy.
Jared Bernstein is literally the Chair of the Council of Economic Advisers, the main agency advising Biden on economic policy
One of the worst arguments I've seen is that you should own gold or Bitcoin in case of societal collapse. I can promise you that both will be worthless in this scenario.
Internet money and a shiny rock only have value in a functioning civilization, not the apocalypse.
I just posted my Forbes article in a thread. Posting it here, it relates to bitcoin.
How many bitcoin was the average worker paid in 2011? He worked about two minutes to earn a bitcoin. Today, he works about half a year.
An EPIC COLLAPSE in wages! 🤪
I said socialism is not economics, it's envy. Some socialists pushed back on this.
Let's look at the policies which are sacred to them, starting with "climate justice" which is just a euphemism for energy poverty.
1/11
@SantiagoAuFund
China's banking system created more assets (and liabilities) in a decade than the US created in 250 years.
The magnitude of this thing is off the charts.
Biden wants to give free $$$ to home buyers. Critics say this does not fix the housing affordability crisis, because it only makes prices go up.
Socialist fixes are never designed to solve a problem in a systematic and durable way.
They're just about robbing Peter to pay Paul.
After bitcoin's death-defying plunge of $52,000 (75%), bitcoiners can no longer claim it's becoming more stable (at least for a while).
So, to what do they pivot?
"Gold to be massively diluted in 100 years by asteroid mining."
Socialism is not about economics. Socialism has no economics. It's just magical thinking plus envy.
No one honestly believes this rubbish. It's just sloganeering to mask their desire to destroy the rich, to make the rich poor.
"Would a gold standard work, today?"
This is the same as asking "would freedom work, today?"
It's not freedom which has the horrible track record in need of constant rationalizing... it's govt coercion.
Every govt intrusion into markets, every regulator, bank supervisor, health inspector, license board, planning commission... acts disproportionately against small business. Hence job creators. And ends up aiding big corporations.
Every. Single. Time.
It's not gold going up, it's the dollar going down. Just about 30mg gold at the end of 2015, now down to around 13mg.
The dollar must be measured in gold. It cannot be measured in euros (i.e. DXY).
Someone said "eliminate the rich people". I asked "what then, once the rich are rounded up, and sent to gulag?"
He said "it would be a good start!"
The envy side of socialism, just wanting to destroy anyone who has more for any reason.
I don't block often, but when I do...
At LBMA conference, many asked why would anyone buy Eagles at 100% premium.
The answer clicked for me. Buyers believe that $36 is the "real" price, and price they see on the screen is just the "paper" silver price.
Sometimes socialists are more honest than they intend.
Article on 6000BC hunter-gatherers who developed food surplus, hence storage buildings... led to "emergence of wealth inequality".
Yup. When everyone starves, all are equal. The moment someone consumes less than he produces…
Lol, the author of the "Bitcoin Standard" blocked me. I never spammed his posts, used profanity, or made personal attacks.
It's my *ideas* he can't tolerate.
So much for a "standard", it cannot withstand controversy or debate beyond the bumper sticker logic it likes to beat.
Socialism promises consumption without production. It's the reward for voting. It delivers by consuming capital.
Bitcoin promises consumption without production. It's the reward for HODLing. It delivers by, you guessed it...
Billionaires don't hoard gold (most don't own any gold at all). They own businesses. They allocate resources to produce the things you need, i.e. capital.
Who (other than MMTers) believes that politicians allocate resources more productively than businesses?
Q4 GDP increased by $335B annualized rate.
OK, but debt increased at an annualized rate of $2.4T!
Any Keynesian fool can increase GDP 1 unit by borrowing and spending 7 units!
The *ONE MONTH* Treasury bill pays a higher yield than the *TEN YEAR*.
This is a train wreck, and the only question is when enough cars pile up and catch on fire to get the attention of the Fed.
If you criticize socialism, the socialists react with predictable arguments. One of them is to point to a creature of the present regime.
"Capitalist, how do you justify THIS?!"
Don't take the bait. We don't have capitalism. Long ago, we started adding socialist institutions.
"Inflation is always and everywhere a monetary phenomenon." -- Milton Friedman
"Friedman was wrong." -- Keith Weiner
Want proof? Look at the large--and widening--gulf between the general price level in California and Arizona.
Same money, different prices.
15 years ago I never really appreciated old-fashioned vehicles, but now that vehicles have become so software-based, almost like car-as-a-service, I have a big appreciation for older vehicles.
A gold currency is not when a govt has X amount of gold (or X amount per currency unit).
It begins with trust in the issuer and people depositing their gold.
If not, if it's just "we are pegging our currency to gold at X:1 ratio" this is a price-fixing scheme that will fail.
Some people want govt to print unlimited money to fund everything on the socialists' wishlist. Inflationism.
Some people want to stop mining, drilling, and use of fossil fuels. Energy poverty.
Why is it the same people? What does inflationism have in common with energy poverty?
So-called Modern Monetary Theory begins with the 1995 Mosler paper, which begins with the false premises that (1) there are idle resources in the economy, and (2) govt can use them more efficiently (by printing money to commandeer them).
Once you accept this absurdity, the rest…
Almost saying the silent part out loud!
What is it, Dr. Bennett, that horifies you about 390 megatons of humans?
You want it to be smaller? Then I have two words for you.
YOU FIRST!
Computers are on the verge of true intelligence the way a skateboard is on the verge of a true motor vehicle, the way a car is on the verge of flight, or the way a 737 is on the verge of flying to Mars.
@oldbooksguy
@ValidScience
Old Soviet joke:
Farmer digs field. Finds lamp. Genie comes out.
"I grant you one wish. But what I do for you, I double for your neighbor."
"Blind me in one eye."
Three questions never asked.
Socialists: what happens if the incentive to produce is eliminated?
MMTers: what happens if the incentive to hold govt scrip is eliminated?
Bitcoiners: what happens if the incentive to maintain the blockchain is eliminated?
Lowest monthly close on dollar!
From a dollar being just over 1500 milligrams gold before the Fed was created in 1913, now worth just over 15mg.
This is a wipeout of 99%!
One issue with unrealized gains tax is the owner does not have the cash to pay the tax.
Another is, even if he does, the tax is literally *HOOVERING THE CAPITAL OUT OF GROWING AND PRODUCTIVE BUSINESSES*.
Opposite of what you'd want, assuming you want growing quality of life.
Well, yeah, it's lost like 80% of its purchasing power in a year.
But at least if you need to carry $̶1̶0̶M̶ $200K across the border while fleeing Interpol, it's all good!
1 bitcoin is skyrocketing
2 bitcoin is a good monetary system
These are not the same statements. If you think they are, then you won't understand a word I say.
(They're actually incompatible)
1 "The Fed has lost its credibility"
2 "Gold moved up"
#2
implies that
#1
is false. No one measures gold by the Weimar Reischmark or the Zimbabwe dollar, or the Venezuelan bolivar.
When the Fed truly loses credibility, no one will measure gold by the US dollar either.
A curious feature of our society is that various groups chip away at the meanings of words.
Orwell and Rand got it. If these groups get away with changing meanings to support their agenda, they win. Most people can't come to (or grasp) the ideas opposing the agenda.
A 🧵
To be a bitcoin maximalist, one must have a deep faith that no further innovation is possible.
Remember HTML 1.0? Archie searches (long before Google)? Novell Netware? The Three Wheeled Benz Patent Motor Car, elevators with hand-cranked gates...