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The wealth-building thread

Spot on. Finally, another non-zealot.
I wish i could give you more than one like
There is no existing digital currency that will be accepted by a goverment. So, they will be considered competition, at worst, or just another investment vehicle, at best
unless they spend the money and get good lobbyists. example of a private currency that didn't buy enough politicians. if there are congress-people with significant BTC investments, it'll stick around.
 
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You are forced to spend it, on something, some way, before it loses significant value.
Or, you don't want to spend it, you Invest it where, in theory, your money becomes more valuable to you AND other people.

"Storing value", if done excessively, kills the economy. Think about it.

You can't save up and wait for a suitable investment. You're forced to act prematurely before its value evaporates.

This is why central banks have a low but arguably reasonable inflation target of 3-4%, not 5-10%.

Many (most?) of the mankind's greatest accomplishment's occurred before the mythical "4% inflation is good" took root.

Most of mankind's greatest accomplishments happened before the great depression? That's a new one.

It's just what everyone is taught and no one questions it.

Lots of people question it. El Salvador uses Bitcoin as currency now, doesn't it? I don't totally buy this argument, but let's trot it out anyway. The US has enjoyed the biggest, longest economic expansion in the history of the human race, since WWII. This took place with both feet firmly planted in the "4% inflation is good" regime. So where's the beef?

I get that on an individual level people find inflation unpleasant, especially when it goes above the target. No mystery there. But having control of a nation's money supply seems to work well - one might say extremely well (in the right hands), and inflationary fiat currencies are basically a requirement for that.

There are clear risks and drawbacks, but going back to the gold standard (effectively what BTC represents) is obviously worse IMO.
 
The US has enjoyed the biggest, longest economic expansion in the history of the human race, since WWII. This took place with both feet firmly planted in the "4% inflation is good" regime. So where's the beef?
The greatest expansion occurred after WWII and before Nixon took us off the gold standard in 1971. Many of humanities greatest achievements were accomplished during that time. Computers, telephones, radio, moon landings, the greatest advances in medicine, automobiles, nuclear, planes, mathematics, physics. All the big stuff was invented during that time. Since then we've wasted time on string theory and fidget spinners. The internet and bitcoin are notable exceptions to our mediocrity since then. Well, cheap, high SINAD DAC's and amps are also noteworthy ;)

The 2% inflation rate target was proposed in the late 90's. It was made official in 2012. The 4% inflation rate target was floated when they realized that 2% was a pipe dream.

In reality, there has been more than 4% inflation ever since Nixon took us off the gold standard in 1971. This allowed them to print money and fund a tremendous financial expansion with easy money at the expense of our children's future.

 
The greatest expansion occurred after WWII and before Nixon took us off the gold standard in 1971.
 
Well, some of that stuff was not invented during that time, but made usable and expanded into mass adoption.
 
The greatest expansion occurred after WWII and before Nixon took us off the gold standard in 1971. Many of humanities greatest achievements were accomplished during that time. Computers, telephones, radio, moon landings, the greatest advances in medicine, automobiles, nuclear, planes, mathematics, physics.
OK, hot shot. Here's a graph of US GDP growth rate over a long period of time, going up to present day. Spot 1971 on this chart.

1690215763574.png


Also, the gold standard was first abandoned in 1933, before a lot of the inventions you mentioned. I've also never heard the phrase "inflation kills innovation" before, not even in economics class in a survey of fringe theories, but it sounds like something you'd agree with?

The gold standard was abandoned and only reinstated in a weakened form, largely because deflation is generally much worse than inflation for the broader economy. The gold standard is generally considered the reason why the great depression was as bad as it was. Which, of course, is something that would be even worse with Bitcoin than gold, since at least you can in theory keep mining gold indefinitely, and the assets of dead people who forgot their passwords don't simply disappear forever if they exist in physical form.
 
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You know deflation being bad for the economy is not really clear cut. Since the early 20th century deflation always happened in economic down turns. But that was because the 20th century was generally inflationary with boom and bust cycles so deflation only happened in busts. Prior to that however, deflation happened for a good 150 years. There were still booms and busts. The general overall trend was deflationary. Due to the industrial revolution goods became better, cheaper, more plentiful while wages stayed the same and from rising GDP everyone in general became wealthier. Industry in general functioned in the 19th century somewhat like computers did for about 25 years. Every few years things were better and cheaper. I've seen academic papers on the issue both ways.

Intentional inflation can be seen as borrowing from the future. If some economies do it in controlled fashion they have a big advantage and everyone else must do the same or fall behind. It seems ultimately unsustainable, but as someone famous said, something will continue until it cannot then it stops.
 
You know deflation being bad for the economy is not really clear cut. Since the early 20th century deflation always happened in economic down turns. But that was because the 20th century was generally inflationary with boom and bust cycles so deflation only happened in busts. Prior to that however, deflation happened for a good 150 years. There were still booms and busts. The general overall trend was deflationary. Due to the industrial revolution goods became better, cheaper, more plentiful while wages stayed the same and from rising GDP everyone in general became wealthier. Industry in general functioned in the 19th century somewhat like computers did for about 25 years. Every few years things were better and cheaper. I've seen academic papers on the issue both ways.

Intentional inflation can be seen as borrowing from the future. If some economies do it in controlled fashion they have a big advantage and everyone else must do the same or fall behind. It seems ultimately unsustainable, but as someone famous said, something will continue until it cannot then it stops.
Deflation is especially problematic in any situation where debts are owed. While you might say debt is best avoided, and you might be right, in any modern economy, debt is more prevalent than water. Significant deflation in 2023 would bury almost everyone.

A preindustrial society is also arguably one in which capitalism has yet to flourish. So you might find deflationary and anti-capitalist sentiment in the same quarters, although oddly enough, you don't in practice.
 
Spot on. Finally, another non-zealot.
I wish i could give you more than one like
There is no existing digital currency that will be accepted by a goverment. So, they will be considered competition, at worst, or just another investment vehicle, at best
The problem with these arguments is, what if Bitcoin is just digital gold? What if it's just another fund where excess liquidity goes? If it's not a global currency, it's not competition for CBDCs.
 
Which, of course, is something that would be even worse with Bitcoin than gold, since at least you can in theory keep mining gold indefinitely, and the assets of dead people who forgot their passwords don't simply disappear forever if they exist in physical form.
There is only so much easy gold, and a finite supply of total gold. Exactly the same as Bitcoin. And if someone is hoarding gold and dies and doesn't leave heirs, or buries it in a forest, it can indeed be lost to circulation.
 
OK, hot shot. Here's a graph of US GDP growth rate over a long period of time, going up to present day. Spot 1971 on this chart.

View attachment 301212

Also, the gold standard was first abandoned in 1933, before a lot of the inventions you mentioned. I've also never heard the phrase "inflation kills innovation" before, not even in economics class in a survey of fringe theories, but it sounds like something you'd agree with?

The gold standard was abandoned and only reinstated in a weakened form, largely because deflation is generally much worse than inflation for the broader economy. The gold standard is generally considered the reason why the great depression was as bad as it was. Which, of course, is something that would be even worse with Bitcoin than gold, since at least you can in theory keep mining gold indefinitely, and the assets of dead people who forgot their passwords don't simply disappear forever if they exist in physical form.
monkey demands I spot trend on a graph with no legend lol
 
Fictitious narrative is central to human cohesion!
 
Somewhat. I didn't have the capital set aside to do what I really wanted, though. Probably true for a lot of people.
I bailed out of tech stocks Dec 2019 because they were way overvalued. I 4x on Microsoft and 5x on Amazon. When tech crashed I saved about a 30% decline in my portfolio. I took all my tech gains and put it into passive income stock in 2020 and 2021.

I am 69 years old and it is not important to me if Nvidia or Tesla stock doubles because if it does, there is capital tax gains to be considered, plus, I don't need a Porsche in my 70s. It is nice to be getting 8% - 14% returns on my investments to help supplement my income.
 
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