Scandinavia and the World

Comments #9637954:


It's important to know what you like 22 5, 10:08pm


1) The Road to Ruin
Have thou read it? It is by Jim Richards and is from 2016 and it explains in great details how not well they have maintained the systems. Much of what I am about to say is derived from that book if thou want to check it.
But the economy is a so called complex system. And risk in a complex system aren’t normally distributed as the central planners think, controlling the economy is not like flying a plane, instead the risk is distributed on a power curve, the bigger the system gets the more the risk rises and it rises exponentially.
An example of a complex system is snow on a mountainside. A little snow is no problem but as the snow gathers in greater and greater quantities the risk of an avalanche becomes greater and greater, and the scope of the avalanche will also become worse and worse.
A smart ski research provokes small controlled avalanches in order to prevent the system from ever becoming too complex.
But what the central bankers have done is to build barriers that prevents the snow from falling down from the mountains, what they have done is to allow the system to become much more complex then what would happen naturally.
So as more and more snow gathers on the mountain, the barriers have to be extended more and more too. However there is a problem, at a certain point that is simply not possible anymore. At a certain point the forces that are contained on the mountain have become so big, that it cannot be contained by any means. Not by the FED, not by the ECB, not even by the IMF.
When the avalanche finally happens, it is going to bury everything.
It is called “systemic failure” and it is a mathematical certainty.

The thing about Zimbabwe, or Weimar Germany, or John Law’s France if we have to go further back, is that it was all isolated instances. It bought down a nation, but other nations still used sound money, the foresighted could simply move to another country and wait it out; this time, for the first time it is global, and it is going to hit every market and every currency on Earth.

2) Bitcoin
Did thou not get how scarcity means hurdle, as in something to overcome?
Yes people have different needs and wants and they change over time, and that is completely different from a things intrinsic value. The intrinsic value is the properties of the thing itself. Gold is unique because its intrinsic value don’t decay over time as most other things, so it can store economic energy like nothing else.
Bitcoin as I said have no intrinsic value, if nobody wants it, it is absolutely worthless. That is part of what is so critical to remember, the supply chain and the end user. People that likes bitcoin suffer from circular reasoning. They want it because they thing others want it more later.
This is a funny little video about how a man that invested all of his money in the now almost worthless beaniebabies found a way to make use of them anyway:

But bitcoin to take just one aspect of it, is not a useful medium of exchange, for the simple reason that it is too volatile. A business person cannot plan on it.
Imagine a shoe salesman that needs to buy 5000 varies forms of shoes each year. Can thou tell me how many bitcoin he would need to buy his shoes next year? And the tear after that? Can thou even tell me what the price will be a month from now.
Bitcoin have no connection to Reality, so its price will always be based purely on speculation, it can’t logically be based on anything else.

Now imagine instead of bitcoin this hypothetical alternative.
The McDonald corporation decides to make their own currency, the mac. They guarantee that the mac is fully redeemable in any McDonald anywhere in the world for 1 Big Mac, and everything else on their menu can also be bought for macs in a fixed exchange rate.
The would exist both as a physical token coins and notes as well as electronically in the form of debit cards.
As a Big Mac costs about 5 USD today the largest 500 mac note would be worth 2500 dollars, and unlike the dollar it is inflation proof as it is burger backed, and unlike bitcoin its price wont fluctuate as the price of the mac is fixed.