Topic: Doubt about Bitcoin's growth potential - page 3. (Read 6578 times)
he seems to think debt equals money and money equals debt. money arose from barter, not debt
Please help me understand/explain to an economist friend of mine...
He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
Just tell him bitcoin is as much a commodity as a currency then tell him to learn about 'Austrian' economics.
Throughout the course of history, humans have always moved to better forms of currency.
Beads -> Sea shells -> Wampum -> Metal Coins -> Gold -> Paper money fiat -> Electronic money (paypal, credit cards) -> Return to gold? Bitcoin?
Beads -> Sea shells -> Wampum -> Metal Coins -> Gold -> Paper money fiat -> Electronic money (paypal, credit cards) -> Return to gold? Bitcoin?
Paper money fiat is better than gold? Huh?
Throughout the course of history, humans have always moved to better forms of currency.
Beads -> Sea shells -> Wampum -> Metal Coins -> Gold -> Paper money fiat -> Electronic money (paypal, credit cards) -> Return to gold? Bitcoin?
Beads -> Sea shells -> Wampum -> Metal Coins -> Gold -> Paper money fiat -> Electronic money (paypal, credit cards) -> Return to gold? Bitcoin?
For Bitcoins to be successful, it has to be able to replace the existing debt!
Whos debt? This reveals a thinking stuck in old system.
Should it replace, US debt? The Zimbabwe debt? whole worlds debt?
All money in the world, including chinese Yen or just the dollar?
Short answer is ofcourse: No.
There is really allready countries which has dual currency systems which works absolutely perfect.
In fact a dual currency system often works better.
Bernard Lietaer: Money diversity
http://www.youtube.com/watch?v=T9EI2PrDpmw&feature=related
It does not have to replace anything to be useful.
A glass can exist and be useful without having to replace all the old glasses.
I can get BTC10 that was not created out of debt, by selling something for them, doing some work, mining them, trading them
for debt based money.
I can trade a sock for 0.1Btc if I want. Without caring how many dollars a Bitcoin is worth.
When I have those. No need to use debt based money anymore.
(Except to pay taxes.)
Its not hard.
And Bitcoin does not belong to a single country.
Its independent.
Whos debt? This reveals a thinking stuck in old system.
Should it replace, US debt? The Zimbabwe debt? whole worlds debt?
All money in the world, including chinese Yen or just the dollar?
Short answer is ofcourse: No.
There is really allready countries which has dual currency systems which works absolutely perfect.
In fact a dual currency system often works better.
Bernard Lietaer: Money diversity
http://www.youtube.com/watch?v=T9EI2PrDpmw&feature=related
It does not have to replace anything to be useful.
A glass can exist and be useful without having to replace all the old glasses.
I can get BTC10 that was not created out of debt, by selling something for them, doing some work, mining them, trading them
for debt based money.
I can trade a sock for 0.1Btc if I want. Without caring how many dollars a Bitcoin is worth.
When I have those. No need to use debt based money anymore.
(Except to pay taxes.)
Its not hard.
And Bitcoin does not belong to a single country.
Its independent.
Please help me understand/explain to an economist friend of mine...
He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
He's wrong because I can owe you 100 bitcoins without having 100 bitcoins. Heck, I can owe you 25 million bitcoins even though 25 million bitcoins will never be in existence at the same time. He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
Please help me understand/explain to an economist friend of mine...
He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
His is, indeed, a very conservative pro-establishment Keynesian point of view.
If you are looking for arguments, look into the discussion for/against (a return to) the gold standard. The points will be almost identical, but there will be a lot more info.
One of the things he's wrong in is propounding the legitimacy of fractional reserve banking.
For Bitcoins to be successful, it has to be able to replace the existing debt![/b]
Please help me:
Where is he right/wrong?
Please help me:
Where is he right/wrong?
I bought 25 bitcoins the other day. I took ~$250 in debt-saddled currency and converted it into 25 units of debt-free currency.
Bitcoin can't do much for the mess that economists and bankers have made of Federal Reserve instruments and their derivatives, but it can go a long way to helping to create a later economy less encumbered by debt-based currency.
Debt is never money, no matter how much kooaid Central Bankers want us to drink.
Please help me understand/explain to an economist friend of mine...
He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
You can't beat years of brainwashing imho.
You can always tell him that loans in bitcoin are doing fine (I lend 100 btc just a few days ago), but that you can't replace the existing system of debt out of nothing for the benefit of the 1%, which is precisely one of the strong point of Bitcoin
One of the reasons why Bitcoin is so brilliant is that FRB (Fractional Reserve Banking) is actually much more difficult than with any other monetary system. Even with gold it's very much possible even though the base money (gold) can't be expanded. In a fiat money system even the base money can be expanded forever and ever, which is exactly what the central banks do.
With Bitcoin there is a radical difference. The base money is essentially as fixed as gold but the big difference is that it's independent of centralized institutions. With Bitcoin there is a very limited need or advantage to deposit your money anywhere. This is why a large portion of Bitcoin transactions will always move outside the banks and this will make it impossible to practise fractional reserve lending in any major capacity.
It will of course be possible and even likely, but instead of banks having 10% reserves, Bitcoin banks will have much larger reserves. This is of course a VERY GOOD thing, don't let anyone tell you otherwise. Tell that "economist" to read something else for a change. Recommend Schlichter's "Paper Money Collapse".
With Bitcoin there is a radical difference. The base money is essentially as fixed as gold but the big difference is that it's independent of centralized institutions. With Bitcoin there is a very limited need or advantage to deposit your money anywhere. This is why a large portion of Bitcoin transactions will always move outside the banks and this will make it impossible to practise fractional reserve lending in any major capacity.
It will of course be possible and even likely, but instead of banks having 10% reserves, Bitcoin banks will have much larger reserves. This is of course a VERY GOOD thing, don't let anyone tell you otherwise. Tell that "economist" to read something else for a change. Recommend Schlichter's "Paper Money Collapse".
Bitcoin can be lent, but cannot create credit in the way that fiat currencies can. Currently, large economies are making up (creating from thin air) huge amounts of currency to buy debt and other assets, manipulating the economy. This is not possible with BTC which is one of the major advantages of it. However, this is not the way the economy currently works. BTC will give users a guarentee that it will not be devalued by a central bank printing more BTC, BUT it does make it less flexible for those central banks and will therefore never be adopted by them. This is a currency of the people for the poeple!
Ehh, firstly, it's the easiest thing in the world to create bitcoin-denominated credit. This is being done all the time on this forum. Of course because of the limited nature of the resource, no sane person wants to owe anyone huge amounts of bitcoins.
Bitcoin is not even supposed to replace inflationary currencies, but complement them. It is not clear if bitcoin can ever be technically scaled up enough to be the sole exchange medium in the world. On the other hand, sovereign nations need to be able to issue their own inflationary currencies through their central banks just to continue functioning, at least in the current environment.
I could see Bitcoin eventually replacing some "specialty" pseudocurrencies, like the SDR, if it really takes off. It won't ever replace fiat.
Bitcoin is not even supposed to replace inflationary currencies, but complement them. It is not clear if bitcoin can ever be technically scaled up enough to be the sole exchange medium in the world. On the other hand, sovereign nations need to be able to issue their own inflationary currencies through their central banks just to continue functioning, at least in the current environment.
I could see Bitcoin eventually replacing some "specialty" pseudocurrencies, like the SDR, if it really takes off. It won't ever replace fiat.
It is possible to fractionally reserve Bitcoins, but what is not possible is printing new currency at will to cover unbacked credit.
This means the institutions which currently benefit from the ability to issue unbacked currency/credit will probably never adopt Bitcoin. How much longer those instutions will continue to survive is an open question.
If "success" is defined by the ability to repay all the debt that currently exists in the world, as well as make good on the unfunded obligations which government have promised to their citizens then no monetary system will be successful. The unpayable debts will be defaulted, either outright via repudiation and/or dissolution of governments, or via inflation. The consequences of these defaults are not avoidable but Bitcoin represents a way to prevent the situation from happening again.
This means the institutions which currently benefit from the ability to issue unbacked currency/credit will probably never adopt Bitcoin. How much longer those instutions will continue to survive is an open question.
If "success" is defined by the ability to repay all the debt that currently exists in the world, as well as make good on the unfunded obligations which government have promised to their citizens then no monetary system will be successful. The unpayable debts will be defaulted, either outright via repudiation and/or dissolution of governments, or via inflation. The consequences of these defaults are not avoidable but Bitcoin represents a way to prevent the situation from happening again.
Please help me understand/explain to an economist friend of mine...
He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
He argues that Bitcoins have no chance in global success because a this system be used to create credit.
Bitcoins cannot be used to leverage. --> You cannot use Bitcoins to create credit. ---> It can't replace existing credit already created by the current system.
For Bitcoins to be successful, it has to be able to replace the existing debt!
Please help me:
Where is he right/wrong?
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