> Currency that can't be inflated in times of a liquidity crisis is inferior.
Inferior to whom?
The problem of MMT is it thinks that the collective is more important than the individual.
Individuals who save money for a rainy day don't need inflation - they've already accounted for potential liquidity crises. The fact that the rest of you can't save is not my problem, it is yours. Please deal with it without devaluing my savings, thanks.
> Sure, some Bitcoiners have such a narrow understanding of economics that they think the permanently fixed supply is somehow really important. It's not.
It's not important to you. What you lack in understanding of economics is the most basic tenet - that value is subjective. The entire field of Austrian economics, which largely gets ignored by mainstream "economists", is based upon this.
Fixed supply is important to savers of money, who don't want to see their savings devalued. Instead of their savings decaying with time, there's fair chance that they'll appreciate in value due to increased demand and deflation due to lost wallets.
> What affects the price is mainly speculation. It's far more important that the system be stable than the fact that maybe over 10 years the supply of Bitcoin grows by another 10% or 20%. It's far more important that people actually use the system to conduct trade, creating actual demand for Bitcoin.
You're still ignoring that saving is a valid use of money. Demand for bitcoin is almost entirely driven by people wanting to save and/or profit from the market for exchange. The "spending" use case just doesn't really exist yet - there's little demand because people can already do this with fiat money. Bitcoin just doesn't bring big enough benefits for spending yet, and people don't want to spend it because it is harder money and they'd rather spend the softer money first (Gresham's Law).
> Long-term inflation just doesn't matter for trade. It may matter for investors, but investing long-term in a currency is total nonsense.
Saving is investing. You are investing in the medium of storage retaining its purchasing power over time. When you hold a stack of USD, you are investing in the dollar. If you suspected that the dollar was not going to retain its purchasing power, then you would certainly not invest in it. The dollar is just a commodity like any other.
Saving in BTC and saving in dollars are the same kind of "investment", except one of them is very likely to always lose some purchasing power over time and makes a poor investment. The other one is risky for now, but it's purchasing power is subject only to conditions of the market and not the decisions of unelected bureaucrats.
> I think your definition of failure is "people who believe in certain things abandon it". Sure, maybe that'll happen, but that doesn't mean the network is going to disappear or that Bitcoin will become worthless. It's going to adapt against beliefs that threaten its survival.
The issue is, as you've suggested yourself, that bitcoin just isn't used that much for spending. It is not going to survive as a medium for exchange if people aren't using it as such. Bitcoin would become worthless because it no longer offers the benefits over fiat money. The "programmable money" thing is complete hogwash that doesn't need an expensive and inefficient blockchain to perform - it can be done with centralized services offering fiat.
Bitcoin is savings technology. There will be plenty of ways for people to spend bitcoin in future, but I suspect that once people become exposed to it, their time preference will rapidly decrease and they'll probably find themselves spending less.
> The problem of MMT is it thinks that the collective is more important than the individual.
Who said anything about MMT? I'm taking the monetarist position of Milton Friedman here.
> Individuals who save money for a rainy day don't need inflation - they've already accounted for potential liquidity crises. The fact that the rest of you can't save is not my problem, it is yours. Please deal with it without devaluing my savings, thanks.
I don't think you understand what a liquidity crisis is. Your view of economics seems to be that of a caricature of an early Austrian.
> Fixed supply is important to savers of money, who don't want to see their savings devalued. Instead of their savings decaying with time, there's fair chance that they'll appreciate in value due to increased demand and deflation due to lost wallets.
The point of a currency is not savings. Currencies are neither investments nor stores of value. If you want to invest, buy assets. If you want a store of value, buy gold.
If individuals are so financially uneducated that they put their savings in currency, that's not my problem.
> When you hold a stack of USD, you are investing in the dollar.
No you're not. The stack of dollars doesn't do anything. It doesn't pay rent. It doesn't pay interest. It doesn't pay dividends. It doesn't appreciate. It's not an investment.
> The "programmable money" thing is complete hogwash that doesn't need an expensive and inefficient blockchain to perform - it can be done with centralized services offering fiat.
Sure, but those are controlled systems. Bitcoin is really good for one thing: Speculating on cryptocurrencies. Sure, you can trade BTC and maybe a handful other cryptocurrencies on ordinary broker platforms, but if you want to gamble on the latest shitcoin, the easiest thing is to just deposit some BTC on an unregulated trading platform.
> Bitcoin is savings technology.
That's a narrative that people came up with to deal with the fact that Bitcoin failed as a currency. It makes no sense. Bitcoin is a highly volatile speculative asset. There is no intrinsic value, no intrinsic demand in "rare numbers" like Bitcoin, no matter how "scarce" they are or whether the supply is fixed.
Inferior to whom?
The problem of MMT is it thinks that the collective is more important than the individual.
Individuals who save money for a rainy day don't need inflation - they've already accounted for potential liquidity crises. The fact that the rest of you can't save is not my problem, it is yours. Please deal with it without devaluing my savings, thanks.
> Sure, some Bitcoiners have such a narrow understanding of economics that they think the permanently fixed supply is somehow really important. It's not.
It's not important to you. What you lack in understanding of economics is the most basic tenet - that value is subjective. The entire field of Austrian economics, which largely gets ignored by mainstream "economists", is based upon this.
Fixed supply is important to savers of money, who don't want to see their savings devalued. Instead of their savings decaying with time, there's fair chance that they'll appreciate in value due to increased demand and deflation due to lost wallets.
> What affects the price is mainly speculation. It's far more important that the system be stable than the fact that maybe over 10 years the supply of Bitcoin grows by another 10% or 20%. It's far more important that people actually use the system to conduct trade, creating actual demand for Bitcoin.
You're still ignoring that saving is a valid use of money. Demand for bitcoin is almost entirely driven by people wanting to save and/or profit from the market for exchange. The "spending" use case just doesn't really exist yet - there's little demand because people can already do this with fiat money. Bitcoin just doesn't bring big enough benefits for spending yet, and people don't want to spend it because it is harder money and they'd rather spend the softer money first (Gresham's Law).
> Long-term inflation just doesn't matter for trade. It may matter for investors, but investing long-term in a currency is total nonsense.
Saving is investing. You are investing in the medium of storage retaining its purchasing power over time. When you hold a stack of USD, you are investing in the dollar. If you suspected that the dollar was not going to retain its purchasing power, then you would certainly not invest in it. The dollar is just a commodity like any other.
Saving in BTC and saving in dollars are the same kind of "investment", except one of them is very likely to always lose some purchasing power over time and makes a poor investment. The other one is risky for now, but it's purchasing power is subject only to conditions of the market and not the decisions of unelected bureaucrats.
> I think your definition of failure is "people who believe in certain things abandon it". Sure, maybe that'll happen, but that doesn't mean the network is going to disappear or that Bitcoin will become worthless. It's going to adapt against beliefs that threaten its survival.
The issue is, as you've suggested yourself, that bitcoin just isn't used that much for spending. It is not going to survive as a medium for exchange if people aren't using it as such. Bitcoin would become worthless because it no longer offers the benefits over fiat money. The "programmable money" thing is complete hogwash that doesn't need an expensive and inefficient blockchain to perform - it can be done with centralized services offering fiat.
Bitcoin is savings technology. There will be plenty of ways for people to spend bitcoin in future, but I suspect that once people become exposed to it, their time preference will rapidly decrease and they'll probably find themselves spending less.