Oddbean

Most humans value a dollar today more than a dollar in the future, which is why interest is charged on loans issued today. The central banking cartel unnaturally manipulates said interest rate, interfering with free market rates and real assessment of risk. The banking system and federal government can create money via multiple mechanisms, fractional reserves lending, quantitative easing, yield curve control, etc. All of these mechanisms have exacerbated the humans time preference for a dollar today versus tomorrow, resulting in no capital formation by the lower and middle class. As a result, capital formation is in the hands of a select few who are blessed by the government and banks via low interest lending. Bitcoin, due to it being in it's monetization phase and fixed supply, reverses all of this, and ensures the lower and middle class can store their time and energy spent into a currency that is likely to be more valuable tomorrow compared to today. People just have to chose the solution made available to them. Freedom requires responsibility on the part of the individual.

If u hv a high time preference that means u want to consume now…. Like those sats are burning a whole in ur pocket so u wanna go spend now If u lower your time preference and wait This gives u time to plan and save. On a fiat standard it’s hard to do But with sats it’s not a matter of if u can afford something…. It’s a matter of when can u afford it Because if u just wait Your purchasing power will increase dramatically

Patience vs Impatience Deliberation vs Impulsiveness nostr:nevent1qqspmcc8wtxc2ccgn8azqghqma0ve69u38vluntfc7455zqlgak3hkcppemhxue69uhkummn9ekx7mp0qgs0ulmtcmmn8zmkh0uqmdqz4hn9j5lzpvhj8enw3xpqfd3ucsjnngcrqsqqqqqpw6qala

For anyone using the marshmallow experiment as an example, it’s not accurate at all. The marshmallow experiment is actually a test on privilege. If you are accustomed to having nothing, you take the marshmallow now. If you are used to having stuff (like a full fridge and support from those around you) you take two marshmallows later. Careful in approaching low and high time pref with the same lens. It is also about privilege. Those who have NEVER had anything or any security in their lives do not understand low time preference. At all. It’s a foreign concept. You’ve probs seen that with people’s behaviour in the developing world. It’s also why, anecdotally, parties and celebrations are way better in sub Saharan africa than anywhere else in the world 🤣

I see it somewhat differently. I agree with you that privileges or, in other words, future security, influence time preference. Nevertheless, it does not change the fact that the person who takes the marshmallow now has a lower time preference. Of course, it makes sense to consider the circumstances and possible reasons for the decision or whether both have the same conditions, but this does not change the outcome of the experiment. It only helps to explain and understand it better, which is obviously very sensible. It is a self-reinforcing cycle, no matter which direction you have taken. Hard money enables saving and capital accumulation. More capital enables more future security. More future security reduces time preference or makes it easier to forego immediate consumption and instead accumulate more capital. Soft money makes saving and capital accumulation more difficult. Less capital reduces future security. Less future security increases time preference or makes it harder to forego immediate consumption and plan for the future, as one is always busy trying to survive the present day.

"Time preference refers to the rate at which people discount or devalue future costs and benefits compared to present ones. The higher an individual's time preference, the more heavily they discount the future." 🤖

The fishing analogy from the bitcoin standard by @saifedean is what comes to my mind. In a situation where you are catching fish by hand to feed your family: If you sacrifice some of your time from fishing in order to build a fishing pole, you will be more efficient at catching fish and that will allow for more time. That time can now be spent building a boat.

I think like if you have money to buy a house today so you can choose to spend it all on the house and buy it straight up or get a loan pay the house over time and with that money generate a higher return ( without discussing how distorted the markets are today) .

The Ant and the Grasshopper One warm, sunny day, a grasshopper was bounding through the fields. He was happy, and sang a song as he jumped. As he got tired, he decided to lay down on a warm rock in the sunshine and watch the clouds. Just then, an ant passed by, working very hard to carry an ear of corn to his nest. The grasshopper was so enjoying his day that he called out to the ant, “Hey! Why are you working so hard? It’s a beautiful day! Come enjoy the sunshine with me!” The ant called back, “We need to store food for the winter. In not so many days, it will be cold, and we will be hungry.” The grasshopper thought that was silly. “Why, there’s plenty of food!” he cried. He went back to lazing in the sunshine. The ant shook his head, and went back to work. The next day, it was again sunny and the grasshopper decided to visit the riverside. He bounded from leaf to leaf over the crisp cool water, not a care in the world. Once again, he saw the ant pass by. This time, the ant was carrying a large leaf. The grasshopper called out again, “Hello friend! Why are you working so hard again today? Come sit in the shade and enjoy the sound of the river!” Once again, the ant refused. “These pretty days are not so many, Grasshopper. Soon, the cold will come. We must be ready.” The ant returned to his work. On the third day, when the grasshopper awoke, the sun was not shining. It was not warm. Winter had come overnight, and the ground was frozen and covered with snow. The grasshopper shivered. And as he looked for food to eat, he found nothing. He walked for hours through the snow, searching for food and shelter. As he walked, he passed the ant’s nest. Inside, he saw ants warm and happy, and sharing a delicious looking meal. It was then that he understood that the ant was right all along – not all days are sunny. The ant turned then and saw the grasshopper freezing and hungry. He felt pity for the poor grasshopper. “Come, friend,” he called. “There is room here, and there is food. I’ve saved enough for many seasons. Come in and eat.” And so the grasshopper was welcomed into the ant’s home, and the ant’s preparations kept the ant, his family, and the grasshopper warm and fed the whole winter long. The ant is low time preference, the grasshopper is high time preference... the ant is a bitcoiner. #bitcoin