2019 and 2020 books are in the
Odds and Ends
It's important to know what you like
23 5, 11:35am
"The Road to Ruin" - didn't read it, checked out the synopsis. Maybe he's right, gold won't help either way. You cannot use it directly and store locally due to obvious difficulties of securing and moving it, as well as having to prove it's purity in every transaction. If you instead move to a gold standard when government stores majority of gold and sets value of arbitrary amount of paper money to each unit of gold. Ok, what prevents the same government to adjust the ratio of paper money to gold?
At least rules of cryptocurrency are set in code that can only be changed if majority of users and/or miners agrees, can be traded at decentralized exchanges, can be anonymous, has fast transaction times and more or less immune to forgery (at least until useful quantum computers are developed).
The only way to freeze transactions and trades is to shut down the internet, which is very unlikely at this point and will become even more difficult with proliferation of internet over satellites.
Also that "buy the things that last" advice is stupid. If you're rich enough and worried about crash of financial system then it's best to have as small money reserves as possible and reinvest in building a business that is more or less resilient against possible crisis. Maybe build a business as big as small country. Go full Krupp. Well, maybe avoid that part about slave labor for which you go to prison and lose ownership of the company.
"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,"
Nope. Zimbabwe used fiat money, US used fiat money. Zimbabwe almost hit an all time high inflation figures, US - not so much. Guess that gold standard wasn't the difference you're looking for.
"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."
You mentioned Weimar Germany, but forgot that following Great Depression hit everyone. Well, maybe tribal societies in Africa, South America or Pacific islands weren't affected, but you wouldn't have much use for gold there and standard of living wasn't that great either.
"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."
For medium of exchange volatility is not an issue as long as there are no significant fluctuations in exchange rate during the time it takes you to accept payment and convert to reserves and currency you use to pay suppliers, wages and taxes. Nothing prevents you from letting willing investors bear the risk. For cryptocurrency that time is relatively short.
Also for something only ten years in existence, facing relatively huge fraud of Mt.Gox and increasing adoption at breakneck speed bitcoin is not as volatile as it could be. Greater adoption and capitalization, technological maturity will lead to a decrease in volatility.
"Can thou tell me how many bitcoin he would need to buy his shoes next year? And the tear after that? "
No. Same goes for gold. That accountant figured it out the hard way.
"Bitcoin have no connection to Reality, so its price will always be based purely on speculation"
Same goes for gold. Demand for industrial applications is nowhere near justifying it's current price.
But ok, assume that it does. Steel is real, it has useful properties, majority of it is in use and with sufficient care it can be stored for really long time. Worst case is that you lose surface layer to rust.
Price still oscillates and is on downward trend, especially if price is adjusted for inflation. Same goes for copper.
"it can’t logically be based on anything else."
Ok. Ethereum does smart contracts and moving towards applications running on blockchain.
"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."
Ok, in next five years artificial beef, GMO wheat, increased automation and improved logistics decrease the price of Big Mac to 2.5 inflation adjusted dollars per unit. Congratulations on your investment in Mac Standard, hope you had diversified portfolio.