Viewpoint | The most amazing passage in The Bitcoin Standard (on)

Note: This article is a clip selected by Yorick de Mombynes from The Bitcoin Standard. When he was published on Twitter, he was also appreciated by the original author Saifedean Ammous. We provide translations to give you a glimpse of The Bitcoin Standard.

1. It is best to use Bitcoin as a set of distributed software for transferring funds: the currency it uses does not have unexpected inflation, and the transfer process does not need to rely on trusted third parties.

2. Although bitcoin is a new invention in the digital age, the problem it seeks to solve is as old as human society: how to provide a currency that is completely controlled by the owner and can be held for a long time (until human society disappears) .

3. People's choices are subjective, and it is not right or wrong to choose which currency. The choice will have a result, nothing more.

4. I call this the “ easy money trap ”: once something is used as a means of value storage, their supply will increase, and once the supply of the item increases rapidly, the value it represents will shrink.

5. To become a currency, it must be difficult to produce. Otherwise, the lure of cheaper means of production will destroy the wealth of the savers and undermine the people's motivation to store the currency.

6. Those time-honored monetary media usually have reliable mechanisms that limit their supply growth. In other words, they can be called " hard money. "

7. (In a society) Which commodity is best suited to become a currency usually depends on the actual technical capabilities of the society, which determine the popularity of different goods.

8. The prosperity of human civilization usually occurs in times and regions where sound currencies are widely accepted. Correspondingly, unsound currencies usually mean the demise and collapse of civilization.

9. Whether it is Rome, Constantinople, Florence or Venice, history shows that a sound monetary system is a necessary prerequisite for human prosperity, otherwise human society will be on the verge of brutality and destruction.

10. History shows that if the money in the hands of others is more expensive than the money in your hands, you can't stay out of it.

11. Humans have achieved some very important technical, medical, economic and artistic achievements in the gold standard era. Therefore, it is also known as the La Belle Epoque in Europe.

12. After World War I, the era of money determined by the free market was over, replaced by the government currency era .

13. Government currency is similar to the original currency and non-gold commodities: the supply can be easily increased, resulting in slow sales, impaired purchasing power, and ultimately making the owner poor.

14. With the gold standard being shelved, the government’s war consumption is no longer confined to the money in the national treasury, but extends to all national wealth.

15. If European countries maintain the gold standard, or if the European people keep their own gold, history may be rewritten, and the First World War may end in a few months.

16. After the First World War, the deviation from the gold standard caused the Great Recession of 1929. The government control and economic socialization of Hoover and Roosevelt deepened the Great Depression.

17. Keynesian naive economics believes that any expenditure is consumption, whether it is the expenditure of individual support for the family, or the expenditure of the government to wage war, which increases the total demand and reduces the unemployment rate.

18. Essentially, the Bretton Woods system is an international gold standard that is expected to be spontaneously formed in the 19th century through a central plan.

19. Hyperinflation is unique to economies using government currency and has never been seen before in the gold-and-silver economy.

20. In an economy that uses government currency, the production cost of money tends to be zero. Therefore, it is entirely possible for the entire society to witness the disappearance of monetary wealth in months or weeks.

21. Hyperinflation is not only a vicious phenomenon that has caused many people to lose a lot, but is more likely to lead to the collapse of the economic structure formed by society for thousands of years.

22. Even if the conclusions in the textbook about the government's control over the money supply are correct, even if there is a hyperinflation in the world, the harm will make the benefits dwarf.

23. Hanke and Bushnell have confirmed 57 times of hyperinflation in history, only one of which occurred before the nationalization of the currency, the French inflation in 1795, when the Mississippi bubble burst.

24. Increasing supply will result in a constant depreciation of the currency, allowing wealth to move from the holder of the currency to the currency issuer and the early holders of the currency, the Cantillon effect.

25. Whether it is blatant corruption, “national crisis” or the proliferation of inflation schools, the government will always find reasons to print money, thereby expanding government power and plundering the wealth of the currency holders.

26. Ironically, in the era of government money, the government's gold reserves far exceed the international gold standard of 1871-1914 .

27. A sound monetary policy allows people to obtain personal benefits only when they provide valuable services to others. Therefore, the entire society will be committed to production, cooperation, capital accumulation and trade.

28. The twentieth century is an era of universal government and unsound currency. People were ordered to ban the use of currencies chosen by the market, and they were violently coerced into using government-issued currencies.

29. Sound currency is the basic premise that individuals can be free from tyranny and oppression and gain freedom. A powerful country with the ability to issue currency will have the power to blame the people, and these powers are attractive to those who are small.

30. Sound monetary policy is a major factor in determining individual time preferences, which has a huge impact on individual decision-making but is often overlooked. Time preference refers to the ratio of the current value to the future value of an individual's assessment.

31. The economist Hans-Hermann Hoppe explained that when the time preference rate is low enough to form savings and capital, or durable consumer goods, the trend of decreasing the time preference rate will be overwhelming and begin the so-called “civilization process”.

32. Microeconomics focuses on trading issues between individuals, and macroeconomics focuses on the role of government in the economy. For an individual's happiness, the most important economic decisions depend on the trade-offs of their future expectations .

33. The more the currency is preserved, the more it will motivate the people to delay consumption and allocate resources for future production, thereby accumulating capital and raising living standards.

34. In the long run, abandoning the currency that can preserve and increase value, and switching to a currency that is easy to depreciate will have serious consequences: reduced social savings, reduced capital accumulation, and may even start eating old.

35. Civilization prospered under a sound monetary system, and vice versa, from Rome, Byzantium and modern European society.

36. For money, what matters is its purchasing power rather than its quantity. As long as the amount of money can satisfy the holder's trading and saving needs (can be divided and combined), it can guarantee its monetary function.

37. The best currency in history is the one that minimizes the effects of additional money and makes the additional currency unprofitable.

38. If the government currency is more suitable for bookkeeping and stored value, there is no need for the government to enact monetary law to enforce it, nor does it require the government to purchase gold globally and reserve it in the central bank.

39. In fact, the central bank continued to hold gold and even began to increase its gold reserves, indicating that the government lacks confidence in its own currency in the long run.

40. Sound currency will increase slightly over time, that is, holding the currency will increase purchasing power .

41. Non-sound currencies are better controlled by the central bank (the latter to ensure positive inflation) and can only provide smaller economic incentives for people to hold it.

42. For non-sound currencies, there is a return only when the return is higher than the depreciation of the currency, thus motivating people to invest in high-risk, high-return, or direct consumption.

43. The savings rate in developed countries has been declining (to a very low level), while the debt of individuals, localities and countries has risen to the point where they could not even think about it in the past.

44. One of the most whimsical ideas in Keynesian economics is that " national debt does not matter, because that is what we owe ourselves. "

45. Keynesian believers who believe in high time preference may not understand the concept of “ self ”. Here, “self” does not refer to the current group of people, but to generations of different people. In other words, the current reckless consumption is at the expense of future generations.

46. ​​The 20th century became a carnival of consumerism, and it was inseparable from the decline of sound currency and the prevalence of Keynesian thinking (the latter devalued savings and deified consumerism as the key to economic prosperity).

47. Ironically, under the instigation of Keynesian economics, modern economics seems so ignorant that it believes that capitalism leads to conspicuous consumption (as opposed to capital accumulation), while capitalism is based on capital accumulation through savings. Economic system.

48. The birth of capitalism is precisely because people reduce the time preference rate, delay the satisfaction, and invest in the future. To say that debt consumption is part of capitalism is as ridiculous as suffocation is part of breathing.

49. The only reason for economic growth is, first of all, delayed satisfaction, savings and investment, which extend the production cycle and increase productivity and living standards.

50. The change of sound currency to depreciating currency has caused generations of wealth to be wasted in one or two generations (conspicuous consumption) and relied on debt to finance consumption.

51. As HL Mencken said, each election is a pre-auction for stolen goods.

52. The lie that politicians sell to people: by printing money, benefits and pensions can remain unchanged. The fact is that printing money has made household investment shrink.

53. Most of the technologies in our modern life were invented in the 19th century, benefiting from the economic development under the gold standard system at that time (people use sound money for capital accumulation, making savings not easy to depreciate).

54. The contribution of sound money to human prosperity is not limited to scientific and technological progress, but also vividly embodied in the art world.

55. In the era of sound currency and low time preferences, artists delve into craftsmanship to produce valuable works of far-reaching influence.

56. Contemporary artists, with arrogant, jaw-dropping values, anger and existential anxiety (to gain audience recognition), have replaced research and long-term practice, and often add some political ideals that are confusing ( Usually naive Marxism).

Original link: https://threadreaderapp.com/thread/985560599248756736.html

Author: Yorick de Mombynes translation & proofreading: Wuwei & A sword

(This article is from the EthFans of Ethereum fans, and it is strictly forbidden to reprint without the permission of the author.