Topic: The economic model behind Bitcoin is flawed - page 2. (Read 14062 times)

I like this   Mostly all of it.  The part about assuming barbarism and misery were the way things were is hardly the view of most historians like e.g. Plato or Bible however, and there are those who claim there is still some barbarism and misery out there as well.  But yeah:  bring on the explosion of knowledge!  And since we have allowed ourselves to stray to other issues not necessarily related to the "economic model of bitcoin"..  perhaps we should not leave aside the issue of education, as brought up once in thread.  I know of not a single professor, colleague, or author who does not complain about the declining standards thereof.  A trend we had better be prepared to fight tooth and nail rather than brush aside and claim is nothing due to college attendance. 

An expansion of knowledge is missing in your example. It means that a deeper insight into things allows to qualitatively expand the resource base of humanity, not just by more fully utilizing existing resources in regular ways but by including into the pool of available and accessible resources things that previously were either not useful altogether (or even unknown to us at all, as many things still are), or useful only in a small, limited number of ways. For example, electricity existed since the beginning of times, but we could make use of it only a hundred years ago. Oil has been known since the dawn of humanity, but it was only after and due to the break-throughs in chemistry that it has become the resource as valuable and indispensable as we know it today...

Quoting Carl Menger on the subject:


The explosive expansion of knowledge is the primary engine that has been driving the wealth of society to entirely new levels during the last few centuries

Well hey, why don't you educate me then?   What is missing from the simple example I gave?  I tried to make it very simple.. sure I can think of some things about life that are not exactly imitable by farms of spherical cows.  Which ones do you have in mind?  Or is it something else entirely I am missing?  I'm sure you will agree that in some instances, e.g. cancer, population growth is not the greatest marker of long term health.   

You should necessarily agree that even if you have lost hope in this dwarf in ever leaving ignorance, there might be a forum reader somewhere that could benefit from your current expenditure of energy here.  Otherwise..  why bother?  Lets hear it    

You don't get it, fundamentally. But you should necessarily agree that if you don't understand this (as you didn't understand why population growth is so much important for the division of labor) then all your ideas and notions about fiat money (dimensionless token sheistery, exchange commodity fraud, and all other derogatory names you used or abstained from using) can be as much misguided or just downright false (reverse thinking, yeah)...

This story is not so much about money as it is about ignorance, wow

Aha, OK gotcha thanks I see your point now.  Yeah, they are relevant in that they help us stay alive (survivability), barring that, not so much.  A pile of food in the larder does indeed become irrelevant after the inhabitants capable of eating said food all died off.  Well not to the bacteria in there or the people who come and find it but that's a different story.   


Well my apologies if I misspoke.  Certainly different infrastructures are decaying and growing simultaneously..  for example railroad in north america and bitcoin infrastrucure worldwide.  My point was not to claim any one type or other was increasing or decreasing but that in general the use of counterfeitable currencies in the construction and maintenance of said infrastructure can only be a detriment to its long term survival. 



Topsoil, hardwood, fish stocks, helium, groundwater reservoirs, glaciers, natural gas to name seven. 

I didn't mean the trees in Vegas were being chopped, haha, sorry.  I meant that the trees in the Amazon are being chopped and traded for fiat..  while others are printing fiat and it gets spent air conditioning Vegas - a process which leads to depreciating the value of the tokens which were given in exchange for the trees.  You see how that goes. 

 

OK, well it depends on other factors.  For example if you have a farm with 100 cows that live comfortably on your acreage, you have a certain amount of wealth from your operation.  Now imagine 100 of you live there.  Each one will have access to less of the wealth.  It's not a huge stretch to move this example to the whole planet considering constant solar influx.

Clearly homeless populations are likely to go up with larger populations.  I think you will find that a certain level of poverty is correlated with population density.  But yeah, these examples are too simple and one should consider exactly what might be meant by the whole shebang and multifold growth. 

??!!??? 
Life is irrelevant to humans how?  Remember we ARE a bunch of animals and plants.

Animals, Mammals, Primates, in particular humans, require and are part of a large web of interconnected life forms.  Have you ever heard of e.g. food?  It's not exactly irrelevant to your economy.     


Compared to what would happen if sanity were considered and failures were allowed to fail instead of being propped up with "lets issue tokens to avoid market forces".   

Sure lets look at the construction and use of the roads.  You asked for a qualifier.  That's good.  Because a blanket assertion that "roads are good" would sure look bad especially after what appeared to be claiming that life is irrelevant.  Roads can suck and be way to expensive to maintain, destroy arable land, and make property more worthless.  Or they can be hugely important to commerce and getting people what they need to pursue happiness.  The difference needs to be decided by the people who use them and by the people who pay for them.  Not by:  "Oh roads.  They are good.  Here let's print some tokens and build them in the most inefficient and short lasting way".  Look at the construction and use of the computers and the internet.  Look at railroads.  Yes people are progressing and building things but we they are held back by the heavy weight of continuous theft and malinvestment.   


Great example.  NPK fertilizers are not solely responsible, but certainly part of the system that has reduced the once great heart of agriculture in north america to near desert status (actually deserts show remarkably higher biodiversity).  Desertification is par for the course around the globe at this time.  Why?  In part because those farmers using fiat are being constantly robbed.  To stay afloat they need to deplete the resources maximally, even then of course they won't stay afloat.  It is impossible to stay afloat if you imagine a fiat currency to in any way represent wealth.  So it's:  chop the trees all down now.  We need to pay for air conditioning of open air decks in las vegas and trillion dollar wars so cut it all down.   


Forgive me but I've seen no evidence that you are literate here.  Literacy rates are lower than ever.  I estimate them at 2%.  By literacy I don't mean "can read stop signs and twitter", I mean a minimum of 1000 pages printed material per month.  Competence in at least two languages.  Basic shit that any college would have required a century ago.  "Oh a higher percentage are going to college now we are so literate!"  <-- you must be kidding us!  Too funny. 

The great thing is that while it might be entertaining and educational to argue these topics here, it is in no way necessary to convince anyone.  There isn't any policy change or vote required to turn the corner of history and get out of the dark ages.  We already are doing it. 

The division of labor is indeed an important factor in increasing the wealth of society. Many have heard about it, and some even seem to understand how it is related to the population growth. But there is another factor which most don't even suspect about that does dramatically change the wealth of society and actually explains for the exponential growth of population as well as aggregate wealth of society:


As I said, this is outright wrong. Why? Because the whole shebang (as you call it) can be and is actually expanded multifold

This is a good point about population feeding back into ability to specialize.  I'll be sure to bring it up with the Malthusians and various other "blame all problems on too many people" proponents, thanks   And my apologies: carrying capacity and population growth is indeed a worthy topic that should be given some airtime whenever it comes up, no matter how off topic it might seem. 

Don't shoot the messenger

It is irrelevant, since no cryprocurrency as of now is actually used as money. It is like counting your chicks before they are banged, wtf

Isnt Ripple a coin with infinite supply?

No, we don't need either inflationary or deflationary system per se. We need a system that could work as both according to the requirements of the real economy (the credit money is quite close to that), and, at the same, protected from the arbitrariness and abuse by a group people (usually called banksters) pursuing their own interests to the detriment of society. The latter part seems to be the most tricky one...

And no, Bitcoin doesn't cut it either

I don't quite understand what you refer to. Please explain yourself

so you mean that we need a inflationary system, but not as a bad as fiat, but more on the deflazionary side, a bit of both basically?

weren't the analysts suggesting that a better economy should be more inflazionary? but i think that they are only looking at their portfolio when saying so...

You say that fiat shines where bitcoin doesn't and then go on about how the injection of new coins is the problem. You're a silly little troll you know that?

But using (as well as developing and building) more and more sophisticated machinery requires yet more specialization, i.e. what is otherwise called division of labor. Given that, the growing division of labor necessarily requires more skilled hands in greater numbers, i.e., on one hand, it requires the growth of population, and, on the other hand, provides means for this growth through a qualitative increase in productivity, right?

So what about the importance of the population growth now?

Strictly speaking, what I meant is more correctly called monetary model, i.e. a detailed description of the concept of Bitcoin as money (e.g. how new coins are injected into the system and in what volume). But since Bitcoin is said to change the ways of life of people economically (and even beyond), I used that term...

To make things easier for them

This is debatable, but when I wrote about Bitcoin economic model being flawed, I actually meant that it is flawed where fiat shines. As to the Bitcoin vs gold argument, personally, I'm in favor of Bitcoin to a degree (in what concerns their models, at least). Gold (as money) can in fact suffer from the same major flaw that fiat is being constantly ashamed with, i.e. hyperinflation...

Yes, it can happen, and what is more interesting, it did happen

Not necessarily.  It depends how they are used.  If it is truly more output in a long term sense, then yes.  But one must keep in mind the story of the Lorax.  In the end everyone was poorer overall.  Not because of the technology but because of the idiocy.