Oddbean new post about login | logout Getting into medium of exchange arguments with fiat brains is a futile exercise. The world doesn’t really need yet another medium of exchange. But most people *desperately* need an appreciating store of value to combat ubiquitous government fiat currencies, which exist primarily to steal humanity’s purchasing power over time. #Bitcoin returns, protects, and appreciates purchasing power over time to those who choose to voluntarily join the growing monetary network.
Good money needs to do both imo, but it starts with being valuable
#Bitcoin will not succeed if it doesn’t become a broadly used MoE soon. Because it needs to be highly distributed and not highly concentrated. Being concentrated in ETFs, strategic reserves and corporations allows it to be diluted through futures, derivatives and fractional reserves and hence also lose its SoV by essentially inflating it. Cornering Bitcoin as a SoV is an attack vector.
Those people still don’t understand the problems of money. Most still think money is *supposed* to lose value over time and that this is good for the economy. I’ve come to a point where I start by asking that question, and if they say “yes otherwise people will hoard it,” I know there’s no progress to be made discussing Bitcoin’s value
I’m with you, Guy. Yesterday’s debate with Parker Lewis and Jeff Snider was a great case in point. They just kept talking past each other.
Where are these debates occurring? I'd like to listen too
These dudes were on Mark Moss’s show yesterday.
Oh okay, thanks
Man you guys nailed it @TheGuySwann 100% the problem. Just talking in circles. 🤯
Can’t hoard forever if you need goods and services
It’s even simpler, there’s no such thing as “hoarding” money that can be objectively defined, and to save money in any form it literally the act of providing resources to the economy without taking anything in return. It’s the BEST thing you can do for economic productivity, to produce and not consume.
This is the reimagining of economics we need.
Investing is more productive than saving. Provided the investment actually produces wealth.
That's a big caveat. So big, I'd say most of even fortune 500 co's fail it. If you can save in sound money, that saving will be more productive - even for other people and companies that have no idea about your savings. I'm assuming its not being saved in a bank, too.
Not in a general sense as most believe (which you caveated obviously), in fact, one can argue the opposite, the overwhelming majority of investment fails and merely wastes resources. This is exactly why investing should be left to actual investors. Plus, too much investment can be just as big of a problem as not enough. Not really disagreeing, but I think this general sentiment is very dangerous. Because it allows people to excuse forcing people into putting their savings in to stupid, thoughtless trash like "indexes" and other instruments for no reason, and it leads to gross over allocation to massive corporations and bloats the ever loving shit out of financial institutions. Always feel the need to counter this idea, even though your statement is true because of your qualifier.
Also there's another point to be made here: "Savings" and "investing" are the exact same thing. Savings IS investing. The question is what should we be investing in? The people and their families, their livelihoods, their security, their sustainability, and their optionality and freedom to explore that which they desire and have meaningful time for connections and self discovery?... Or some huge corporate enterprise that will stick them in a cubicle and they will be trapped without options because they have no savings? ALL savings is investment. Personal savings is investment in your future, family savings is investment in your time, options, and sovereignty, and producing a surplus for society is an investment in humanity as a whole as you leave those resources for others to create and work with under the trust that they will be good custodians of that value you've produced.
Respectfully hard disagree here. Saving is net neutral. Saving is saving. Not spending, not investing. Investment always carries risk of course, but usually you asses the risk and invest in companies that have a ROI. It's just impossible to invest in the current monetary system because prices and priorities are so ridiculously distorted, it's impossible to responsiby invest. Bitcoin is slowly killing that distortion. Saving is high time preference. Investing (in a normal world, not 🤡 world) is low time preference. It's hard to see because of the 🤡 world we live in.
lol, respectfully hard disagree in return.😆 This may be a semantic disagreement. But to further explain, there is no such thing as idle resources in an economy (aside from literally purchased and rotting capital). Money is not a resource, it is a record keeping system. The act of saving is producing resources into society and holding onto a receipt of your contribution. All savings are the creation of capital for productive endeavors, it is simply that you choose to not yet decide which enterprise to place it in, so you simply leave it to the whole of the economy to decide. But your net contribution remains an investment of resources regardless. TARGETED investment is to believe you have found something that will, on net, do better than the average of society (which will be realized in the value of the money itself). Thus it becomes worth it to explicitly decide where those resources go. But either way it is a net capital availability for society, and what it means is the same. One is simply targeted, while saving money results in investing in the index of the entire economy that uses it (in an abstract sense). Plus being critical for the safety, security, and mental well being of all members of society in their individual situations. In other words, there is no objective claim that “investing is better than savings,” because it is purely a subjective judgement over where resources should be directed. To my future, or to a business enterprise? To anyone in the economy to determine where it goes, or to a specific counterparty or idea? And to say that the security, net surplus, and personal sovereignty of the individual isn’t important or “as important” as some business enterprise for society is, imo, to misunderstand what society is. To sacrifice the well being of the people for the blind goal of “more output” is to beg the question of what is valuable to begin with. You have to make that judgement first before making the claim, which means it’s built entirely on our subjective idea of which is a more valuable use of resources. But it’s ALL an investment of resources somewhere.
Amazing, @OceanSlim and @TheGuySwann are going at it whilst @BlokchainB sits in the corner like that crow that started a cat fight. https://youtu.be/Qt-pB1R64mI
lol this is just what real bitcoiners love to do for fun, argue. 😂 Every time I go hang out with bitcoiners all we do is debate about about big ideas, lol.
WERE TRYING TO FIX THE WORLD OKAY! Sincerely, all with love nostr:nprofile1qqstnem9g6aqv3tw6vqaneftcj06frns56lj9q470gdww228vysz8hqpz4mhxue69uhk2er9dchxummnw3ezumrpdejqzrthwden5te0dehhxtnvdakqz9rhwden5te0wfjkccte9ejxzmt4wvhxjmcjgxv3n I can only pray that I can contribute as much to fixing the world as Guy has. I may disagree here, but we're aligned in our goals and I have nothing but respect for him 💜
Ditto, Fren!
Agree with everything above. well said.
Another way to look at it. To take the Bitcoin standard example. The person that invests time (read money) in making a fishing rod instead of just fishing by hand is delaying getting fish now to get more fish later on. (low time preference) Investing money (read time) in a company for more productivity in the future, is low time preference. When you save, you are engaged in high time preference. It's the better move currently as the future is so distorted, it's hard to know what a good investment is actually, but that comes with less productivity. This is why debt CAN be good. Debt is just leveraged investment. Most investments right now are bad, so most debt right now is bad. A time investment in making a fishing rod and a money investment in a productive asset are no different. Time is money is labor is energy. This is why you should be spending Bitcoin anywhere that accepts it. Spend and replace until the new monetary standard arrives to the masses.
This is all true, but realize that you are using an example without money in the equation. When you add money then the act of saving allows investment for others to be available in the first place. And it doesn’t require a loan, this is what producing extra resources and thus lowering their price will naturally do. - If Bob doesn’t know what to invest in, he can produce and save money, and this gives the societal surplus of the same amount for Tim to make his fishing net. the same thing happens with the capital, him loaning it is merely for him to think he know exactly *what* to invest in.
The overwhelming majority of investments fail because the money is broken. Bitcoin fixes that. Imagine investing Bitcoin in SP500. Not a chance.
I been thinking about this. I think bitcoin will be pristine capital and capital formation will be needed to pursue risky endeavors. Thus ending zombie companies using cheap money to stay afloat and devalue labor.
Saving money is generally seen as deferring immediate consumption. Money saved is generally put somewhere to get a yield, which is usually a CD or savings account at a bank. Banks lend their deposits, and if done so in a responsible manner, it is lent towards productive enterprises. Just like any other ecosystem, both savings and spending are connected. One without the other creates imbalance Anyone who thinks savings is “hoarding” money doesn’t understand basic economics.
"Deferred consumption is what makes capital formation and civilization possible. People work to create things that they don’t immediately consume, and those new tools and processes make it easier to create more things in the future with less effort, which raises the productivity of the economy (getting more output for less input) and makes society as a whole wealthier. Those new tools and processes can then be used to more efficiently create other tools and processes, which increases productivity even further, and the whole thing compounds on itself in an exponential curve of increasing productivity and increasing wealth. But it all starts with and relies on someone somewhere putting in effort now, to create something they won’t benefit from until later." https://www.f0xr.com/p/money-as-equity
My response. "So when you keep money in your bank account, what are you doing?"
I've come to the conclusion that Bitcoin selectively reveals itself to people when they're ready. You're not ready to understand Bitcoin yet? OK, it'll be here ticking away until you are. We're getting closer & closer to the point where owning some Bitcoin is obvious to investors. I would prefer it became obvious to savers first but you can't force people to see what is in front of their faces already. You can't get people to use it as savings if they can't first generate a monetary surplus.
I’ve been having unexpected and very productive conversations with people about bitcoin. IRL convos are more chill than online. For those argumentative few my reply is it’s ok that you don’t get it yet.
Eric Yakes writes about the three stage evolution of the new monetary foundation here: https://epochvc.io/writing/
https://m.primal.net/KBdN.png
Exactly. My (approximate) time frames for the progression: Collectible: 2010s SoV: 2020s MoE: 2030s UoA: 2040s
And the best thing we can do is encourage circular economic networks to self-assemble and connect across the world.
Seems useful as a unit of account already.
For 7B people in the world, Bitcoin is an important MoE tool. These people also mostly don’t have any need for store of value. (No savings yet). It is us 1B, who live in a country that have functioning MoE that need store of value.
Sounds reasonable. The interest in ETFs definitely shows store of value is here. I think lightning, ecash, fedi, nostr, etc development this decade and will drive the medium of exchange, starting in the unbanked/weak currency countries first.
We don’t NEED it as MoE but we will use as that now to rug pull every gov and corporation that stole from us for decades. Individuals and small businesses now have all the power
I am intrigued to see how the “Unit” does once the BRICS coalition starts to utilize it. While I do that, I stack sats!
I agree, and yet there's more to it. If we recognize that governments are debasing the monies then it is highly probable that they will mess with the on/off ramps, thereby making the MoE pretty darn important.
@Jeff Booth has a different take re MOE. You may want to check out his latest pod on @walker 's pod where he makes the case that MOE is critical to keeping #bitcoin decentralized and secure. #fedimint, #cashu are #lightning are key to achieving it. Would love to get your thoughts on Jeff's take. https://youtu.be/-o02OLYsnw0?si=gvmEB7umTF4CfL4-
