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Originally Posted by Duey
Steve - You always try to put down the USD and the currency being printed when ever.
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Apologies if you / others read into it that it's somehow only USD.
It's all modern central bank currencies devalue on an ongoing basis. Am not at all 'putting them down', it is a fact in the math / known ever-declining buying power.
Fact, not opinion. Math doesn't lie.
This is backed by decades of solid math and reaffirmed by central bank representatives who target anything more than 0% interest rate. For those who understand compound annual calculations, at 2% annual devaluation (aka inflation), what is the loss of value after only 10 years? After 20 years?
Now do the same calculation at 4% annual inflation for 10 years... and 20 years. HINT: The 20-year calculation should scare the living sh__ out of you.
So, with those calculations done, would you call any of the above a stable currency as in no gain or loss over time?
And what are the ramifications of these losses?
Aaaaand here's where Steven goes a bit off-the-rails....
We could extend this to societal problems, as in how has the devaluation of currency over time negatively affected family life? If the norm was a single parent working could support a family of four... but decades later now both parents have to work to keep the same living standard... what are the long-term problems in society since both parents have to work (children lack parenting time, for example).
Back on the rails, let's get back to currency chat.
There's not a single modern central bank currency that is stable, none. They all devalue (some faster than others). I challenge you to find a modern currency that has increased in buying power over time.
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But the truth is that all the people want to turn their crypto into cash. How many people say they lost 2 bitcoins? They only talk about their bitcoins as if they were actual currency.
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Broadly speaking, am not a crypto fanboy, or gold / silver for that matter (we know for fact PMs are manipulated by Wall Street / Traders).
But pretty please sit back and understand the pros and cons of each
system of exchange for goods / services / etc. Also calculate the buying power long-term, including the fees / loss due to using ___ as a form of exchange for goods and services.
Carrying loss and usage fees can hurt a company's bottom line, and a family's savings and future hopes of a certain lifestyle as they reach retirement.
Of course there are great 'profits' to be made if you are the credit card issuer / financial institution. These fees, imho, are a big drag on a country's economy as it (broadly) takes away much-needed funds from consumers. These fees moreso (percentage-wise of their income) hurt those who can least afford it (the working poor).
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Crypto aka Bitcoin is not money in any way shape or form.
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And no modern central bank currency is money either, but that gets into the actual meaning of words (and am sure i sound like a total d*ck even pointing this out). Currency is not money. Just as inflation is, imho, better understood when it is referred to as currency devaluation.
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Referring to crypto
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1) It has no intrinsic value in that it is not redeemable for another commodity, such as gold or cash.
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It can if two people agree it is during an exchange (akin to bartering), but would rather focus on the bigger picture. Brazil has just voted to allow crypto, and i believe the Middle East is also a big proponent of crypto (and when the oil-rich ME likes it, pay attention imho).
Again, am not a crypto / gold / tulip fanboy. Am more a fan of trying to achieve the best results from efforts / work, and preserve the storage of value due to these efforts / work over time. Am simply looking over
the scope of things in a broad manner over the decades. If there is one thing i am a fan of, it is bartering. Two parties have something (work for hire, a couch, bottle of booze, toilet paper... whatever) and they agree on their own exchange. Agreed exchange, with no loss during the transaction to a (parasitic) third party.
Back to crypto...
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2) It has no physical form and it exists only in the network.
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Like the stock market / bonds / electronic claims that are said to represent precious metals...
TRF has zero value?
Ouch, that's gonna sting a bit. Sorry Steve, TRF has
enormous value imho even tho there's nothing physical about it.
Currently, a majority of central bank currencies and their financial system scheme used for the exchange of goods and services is electronic. Am sure we can agree there is very little actual cost when central banks choose to expand the quality of their currencies by a few billion here, a trillion or two there. Logically speaking, when a single company at a set known value chooses to add / create a few million more stock 'certificates' available for public sale, it devalues all the stocks that preceded it (since there are more claims on the same known overall value of the underlining company).
Perhaps the bigger question is, how can you maximize the value of your efforts? How can you reduce your exposure to systemic losses due to transaction fees? And, perhaps most important of all, what is the best way to preserve the value in ____ longterm.
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It deeeeeply saddens me this is not discussed more, is the large picture concerning the negative outcome of society due to currency devaluation. Less parental hours for the upbringing of children, less time to help your parents, and one's personal health issues are increased due to working more / higher stress to achieve the same level of living as you had just a handful of years earlier.
There are far broader 'costs' to society / humankind due to modern currency schemes, and paying attention to social problems is far more important than 'the economy'.
NOTE: All the above jmho. Am not a financial manager, have no college degree, and oh heck, you just read something written by a high school dropout.