Topic: The fiat-money bubble! (Read 3513 times)

Every cryptocurrency is speculative functioning. This will be the best to make an decentralized system  work in​a perfect manner. As said we can't print as Countries that print of their own to make the economy strong at times of unexpected fall that recently happened with China.

This is nothing really new hyperinflation comes from the Romans,  the difference is there is a currency so dominant that if it were to fall it will bring the whole world down with, but make no mistake bitcoin is also a bubble but with the difference that bitcoin cannot be printed at will.

You seem to be stuck in your own mental prison

I have explained it just a few posts before that any quasi money is set to fail if it can't transfer value over long distances and do it fast (preferably instantly). Cigarettes can't do that, why I should ever explain it at all? On the other hand, the US dollar is not the only pebble on beach, but according to your logic, all other fiat monies out there are not monies? Or are they money just because they happen to be issued by some government? Bitcoin has already got circulation exceeding that of some currencies, and personally, I expect its growth to go exponential when its issues with fees and confirmation times get fixed in due course. Then you may want to raise this question again

No, I don't have to, in order to support my claim that the state maintains a monopoly on money, which comes with all the incentives for the elites to destabilize their own system.

Because it's obvious that the state has the monopoly.

Prisoners use cigarettes to carry value and exchange them like money.  Their cigarettes didn't break the back of the dollar.  Neither has Bitcoin.  (Although one day it might, if state money self-destructs due to the above incentives, but that day is not here yet, so the incentives are alive and well.)

You may like it or not but Bitcoin IS money

It is mostly used as a financial asset nowadays (which I always emphasize myself every time), but it fits the definition of money and does what this definition requires. And by its sheer existence, it proves that the government monopoly has been broken (the reasons why it happened I explained before). To successfully support your claim (i.e. that the state still keeps their monopoly on the issuance of money), you basically have to prove either of the following two points. First, that Bitcoin can't transfer value (I guess you won't deny Bitcoin existence as such, though who knows), or, second, that money is not about transferring value. And the latter is not my definition, just in case, since when money can no longer transfer value, it just ceases to be money. This is particularly true with respect to money tokens which have no value of their own, i.e. they are valued only as long as they can fulfill the function of money, that of transferring value


That's hilarious (I hope you understand it yourself)

Bubbles are common in every market, regardless of whatever it is. So, this whole thread is worthless.

The only thing that gives the money value is its relative scarcity and the faith placed in it by the people that use it.
Tell me what gives value to bitcoin? Technology behind it, or its also cause people have faith in it? From my objective point of view both can be bubbles.

The fact remains, the government has always maintained a monopoly on money issuance in modern times.  I don't care if your definition of money requires that money must know how to fly.  You can't change this fact.  Gold and Bitcoin might come the closest among everything else in challenging the monopoly, but they're not nearly close enough.

Since it's obvious for anyone to see, any attempt to deny this merely confirms your desperation to argue that state money will be stable, by any means possible.

Decentralised currency is the main motto of bitcoin and it can not be misunderstood with bullish goals. It is the only thing that makes bitcoin so much flexible in its transaction and behaviour. People are interested in that flexibility so bitcoin will always have preference as fiat money. We can store any amount of bitcoins without any hassle and restrictions. I believe it is possible to be one if the best fiat.

Any currency can depreciate and bitcoin also. It is well thought out and develops, but no one can be sure what will happen in a few years. I hope he will still exist and make a profit.

Western Union doesn't print their own money

The same pertains to PayPal and other payment processing companies whatever their name might be. Honestly, somehow I thought you were smarter than that. Anyway, the question is not about clam shells, the question is about Bitcoin. And yes, Bitcoin did break the government monopoly on issuing money big time, and it happened precisely because the government lost their monopoly on communications. A few private companies tried to do essentially the same in the past with their money tokens but they were small fish and didn't end up well in the end. I remember about some Canadian company that was dismissed by the government for doing something which they hadn't the right to do (i.e. issue money). Bitcoin is global, and as such it is effectively beyond government control of any particular country. A government can forbid the circulation of bitcoins in the area, but they lack the power to forbid Bitcoin as such just like they lack the power to forbid, say, gravity

Did the state take over Western Union?

It is simply absurd to assert that the state no longer has a monopoly on money.  If we are not using dollars or euro, are we using clam shells to buy stuff?

Sure, say anything to justify that state money is stable.

Could you post a link, I might have missed that post of yours


As I said, this is inconsequential to the matter in question

In other words, it is no use sidestepping this issue. Forget about gold at last, it won't help you. We are talking about present day, and till recently governments had monopoly on money issuance since they controlled means of communication via which value can be transferred. As I also said, private money in the form of cash (i.e. which relies only on hand-to-hand transactions) is devastatingly useless. And with the Internet arising from obscure military labs, the state lost its monopoly on global means of communication and thus lost its monopoly on money (obviously, they couldn't foresee that). Money, conceptually, is all about transferring value, and in today's world transferring value means transferring it instantly and to every corner of the world. Anything which aims to become money but doesn't offer the possibility of such transfers is set to fail miserably

Bitcoin can bring flood of profit at any time in future and it is because of its decentralised nature as you depicted in your one of the assumption. It's not bubble, it's truth that is hard to believe that bitcoin can be worth millions dollars one day. See the charts and waves of bitcoins in the trade market it always fluctuates but with incriminate in value as the time is passing. 

Even though governments are manipulating these paper currencies, they got more value than any other crypto-currencies because fiat is the most accepted currency in the whole world. These crypto-currencies are very less value compared to fiat currency value world wide. At the same time, there is no guaranty that these crypto-currencies will never come down. If any bad news comes out then very fast, these prices will come down, but that will not happen with any fiat currencies. So I feel even though there is a bubble in fiat currency still it has got more value than these online currencies.

If so, I have good competition!

BTW, last time I checked, you have yet to answer my response to your charge that I was somehow dishonest (because I dealt with monetary issues you don't seem to understand,) and you have yet to provide the explanation I requested about key features of the gold standard, to prove you have a basic understanding of money.


The gold standard was never about gold.  It was about protecting the stability of state-issued paper money.  The system has been, and will always be, focused on protecting the power and wealth of the state-bank alliance among the elites.  That is, until the people wake up.

The gold standard was the chief protector of state-issued money.  When the British government publicly stood behind their pound by pledging to redeem it for a fixed amount of gold on request, you had faith in their pound.  Even more importantly, gold earned no interest, so you kept your savings in sterling.  (Of course, this gave the British elites all the incentives to keep issuing pounds until such redemption became completely hopeless, by 1931.  Oh, BTW, it just happened, what followed was the most economically painful period of recent Western history, but, of course, it had absolutely nothing to do with state money.  Nothing.)

So you're saying the chief enabler of the state monetary monopoly was communications?  So now state money is no longer a monopoly?  And you say *I'm* dishonest?  I might be guilty of missing the state takeover of Bell or AT&T, but would like to hear the whole story...

On the face of it, who is more likely to be dishonest?  Someone who argues in favor of elite-issued money, or someone who argues for state-free money?

You are as dishonest as always

At first you started talking about the money issued by the state (otherwise known as fiat) and then, all of a sudden, you switched to gold and gold standard. Gold as money is not issued by the state, period. Other than that, yes, the state monopolized fiat money (or soft currency if you are going to pick on the word fiat) since it had monopoly on the means of communication. Privately issued money (or publicly if it is beyond the state's control as Bitcoin) without the capacity of transferring value over distance is set to lose to any fiat currency which doesn't get abused too much

Fiat-money is one of the worst kind of wealth holding options nowadays.
It is highly manipulated by governments and it is just paper of government you know. can turn into bubble. what is its' original value? just state!
also paper money damages poor people in economic crisis.

If you have a short-term perspective, I can understand why this seems plausible.  But have you looked at a table of all the state-issued monies in modern history?  Among the tiny portion of long-term surviving ones (including the dollar, sterling, some currencies that became part of the euro, etc.) the loss of purchasing power over the decades is still staggering.

And these survivors just happen to be countries with a lot of power to make other countries help prop up their money.  Interesting, isn't it?

The problem with state-issued currency is that the politicians and bankers have the incentives to degrade and destabilize their own system by issuing or borrowing too much.


This is unfortunately true, but is due to the use of state power to maintain what is effectively a rigged capital market.  (See my post 'Dissecting the Parasitocracy'.)

That said, after the final failure of the gold standard in 1971, we can finally hope to gain by buying and holding gold for the long term.  Of course, the elites and their economists will want us to believe otherwise, by suppressing the price of gold (see books 'The Gold Cartel' and 'Gold Wars.')  But the dollar has lost 97% of its value against gold since gold was 'demonetized' in 1971.  Bitcoin is arguably in the same boat, as a store of value if not as trading money.


If you're asking what an ideal system would be, it would be money and debt that is totally free of state intervention.  Depending on the nature of growth in the economy, we can't say what form it will take.  The important thing is that the free market should decide.  With state money, all the problems of socialism will occur, even though most people don't understand them, since they're financial in nature and are hidden inside the 'capitalist' system.


Bitcoin, especially at today's cheap price compared to gold (when comparing similar proportions of total supply,) is an arguably superior investment, partly because the elites want to dilute the demand for gold by having investors go into Bitcoin.  There are other good reasons.

I'm sorry, but this is wrong in many ways.

Are you saying communications technology was how the state used to monopolize money?  Compared to the gold standard, communications interception wasn't even a close second, in terms of being a tool of monopoly.

And in any case, with the gold standard secure, the state had no need to resort to 'low-brow' techniques to prop up their money.  (But maybe now the do.)

Also, can you seriously say the dollar, euro, etc. are not state-money monopolies today, with all the same incentives for the elites to destabilize their own system?

Is this the basis of your conclusion that state money will be stable, that they're 'no longer monopolies?'  If so, it is simply absurd.