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They're terrible and stupid.
Posted by Fron, on March 13, 12018 at 18:44:38:


Also yes, deflation is bad for a variety of reasons (debts increase in real value which cripples debtors, people hang onto as much money as they can instead of spending it since the same money will get you more stuff next week so economic activity dries up and you get a depression, etc). You typically want your currency to be inflating at a slow and predictable rate so that things with "sticky" nominal prices can decrease in real price if warranted by the market. (Fewer things resist nominal price increases than resist nominal price decreases, so you don't get much of a corresponding benefit when deflation is happening - although candy bars probably wouldn't have gotten smaller if north american currencies were deflationary).

Source for the above: Half-remembered first- and second-year macroeconomics. So, y'know, decide how much you believe me accordingly.

Also cryptocurrencies waste huge amounts of electricity performing useless computation and therefore contribute to global warming and high electricity prices. These externalities are such that while I would otherwise roll my eyes and ignore the whole thing I've come to think that the whole idea ought to be outright banned if possible.


I've been trying to learn about the forex and stock markets in order to improve my crappy cryptocurrency trading bot until it can make enough money to comfortably live off it. (So far, it's barely making enough profit to cover my $600 rent and an occasional plate of discount sushi.. seems OK, until you consider that I've spent like 160 hours developing it and I could have easily earned $100/hour with the same skills, haha)

Anyway, the more I learn about how the economy works, the more stupid and pointless these decentralized currencies seem. Even if you overlook all the technical challenges and the wild swings in value, just the fact that they're all deflationary would apparently make them untenable for taking out loans or paying salaries

As I understand it In a deflationary period, money is becoming more valuable over time, which means that goods are going down in price along with pay.. the problem is that the way pay goes down tends to consist of laying people off or giving people shittier jobs than they could have done, and it really sucks to have your mortgage get bigger every year because of deflation. Un/under-employment combined with mortgage failures then proceed to fuck up the whole economy

Anyway, am I missing something, or does that sound accurate?? Basically it sounds like a semi-well-managed fiat currency (even under the management of a garbage-jerk like Reagan or Trump) is way better for everyone than a deflationary decentralized cryptocurrency


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