I have a friend who is persistent in thinking that it is a problem that Bitcoin has a limited supply. I tell him about how this isn't a problem because Bitcoin is infinitely divisible, but he still doesn't get it. He also has a hard time believing an economy could function if prices for goods and services goes DOWN over time (deflationary) instead of up (inflationary). How would you try to get these points across to him?
pull down to refresh
174 sats \ 2 replies \ @Louferlou 13 Oct 2022 freebie
Usually the argument of this people is mostly: in a delfationary society, the economy would collapse cause people would indefinitly postpone their purchases.
I often answer that:
- every human has basic needs that needs to be satisfied (home, food, energy, transport)
- some part of our economy is already deflationary despite high levels ofmoney debasment. For exemple computing hardware get cheaper years after years. But did people wait 10 years to buy cheaper the Iphone from 2010 ? No because the opportunity / cost ratio of buying the new iphone each year is viewed as superior than just waiting few years more to have it at a discount.
So in short, a deflationary society don't crumble because people stop consuming. But the 3consumer society" that is so critisized will collapse, cause people will learn about low time preference and its benefits.
Finaly, for the salaries matter, I can imagine a society where salary stays stable more than decrease. It would be a normal thing to have a constant salary, and as all prices around are decreasing in Bitcoin term, this can be considered as a promotion to reward fidelity and experience through time.
reply
10 sats \ 1 reply \ @faithandcredit 13 Oct 2022
I would argue that in a deflationary society people would increase consumption because over time they get wealthier. More wealth = more potential consumption
reply
7 sats \ 0 replies \ @Louferlou 13 Oct 2022
This would be admitting than a deflationary society is wealthier, so you win...
Anyway overall consumption would certainly be higher, as everybody is wealthier, but also much more rational as you can plan your future more accuratly than with a melting "store of value" which oblige you to waste your time and energy, investing in bubbles and other nonsensical ans useless assets.
reply
11 sats \ 0 replies \ @l0k1 13 Oct 2022
Just point out to them that Bitcoin does have inflation until 2140. Currently sitting on around 1.7%
reply
0 sats \ 0 replies \ @weatherall 14 Oct 2022
Use a cane .
reply
0 sats \ 0 replies \ @faithandcredit 13 Oct 2022
Prices go down over time, they always have, so far. For example 300 years ago wheat was considered a luxury but today most can afford it and eat it every day.
A smaller time frame example is computers and internet. At first it was only universities that could afford, but now everyone can. How do you explain that?
reply
0 sats \ 0 replies \ @nerd2ninja 13 Oct 2022
Just talk about gold and silver instead. Then you can speak in historical terms. Quite frankly, if he doesn't like Bitcoin, and prefers gold and silver instead, then good on him! Let people decide what's best for them.
This is another point. There is no reason for someone to hold something they know will be worth less over time. So no matter what big picture arguments he might provide, just point out that on an individual level, you're just not having it! The individual level is what matters, because if everyone does what's best for them, moving away from an inflationary system is natural.
reply