723700+ entries in 0.375s
wywialm: i'll be going,
thanks benkay for a nice chat
phf: now
that i can
test it ;)
phf: next step is
to add assbot integration
benkay goes back
to mutating cloud boxes
assbot: Voicing phf without
time-limit.
wywialm: btw:
that reminded me about another consequence of deflation, which should be obvious:
the zero lower bound of interest rates
wywialm: what
they should do is
to do as-neutral-as-possible QE.
Think about it, if you have a bank, and demand for your notes skyrockets, you issue more, not less, right?
wywialm: and
they are cowardly, i believe, as
they could push interest rates lower even in
their imperfect framework
wywialm: and it is not equally distributed
throughout eurozone, south is deflating for a couple of years, -1.5% i believe
benkay: what are
their lines of recourse and why aren't
they using
them?
wywialm: inflation 0.5 %,
target 2%
wywialm: not necessarily, as i
tried
to point earlier
wywialm: and
the same situation is in Poland, official inflation
target is 2.5%, we are ~1% and head of National Bank of Poland says he's ok with
that
wywialm: in
that, Germany and
to lesser extent, France.
benkay: hey wywialm who actually controls how much money sloshes around
the eu?
wywialm: why don't
they flood EU with cash, when
they have mandate
to do it?
benkay: just helping
to illuminate, bitcoinpete
wywialm: currently, i'd bet something between 'largely' and 'sometimes'. Have a look at EU,
they are heading for deflation, despite
their official inflation
targets, same in Poland
bitcoinpete: benkay: yup. and i meant
to say
that bitcoin prevents
this, if i wasn't clear
benkay: solely, largely, a lot of
the
time, whatever
benkay: isn't monetary diddling used solely
to socialize losses?
bitcoinpete: wywialm: right, which all means
that
the losses, as well as
the profits, are privatized, whereas we currently socialize large losses
wywialm: benkay,
true, but
this is a source of rigidity which will impact
the real economy
wywialm: and
third, most important probably, are network coordination failures. On a reasonably populated market, if
the nominal demand (or
trade volume) falls,
the first enterpreneur
to lower prices would not suffer losses due
to demand inelasticity
benkay: so
the world changes out from underneath you sometimes. one
tries
to plan and account for
these
things. sometimes
the irresistable force is just completely irresistable.
wywialm: second,
there are long
term contracts negotiated in
terms of monetary unit of account
wywialm: first,
there are menu costs and other costs of price adjustments, such as making plans and accounting
bitcoinpete: price rigidity is just another form of
tversky and khaneman's anchoring and adjusting
wywialm: (generally, if
there were no price rigidity, sharp deflation would be no problem, I believe)
wywialm: there are exceptions
to
this, grouped under
the
tag of 'price rigidity', which has many origins and which i'll
try
to sum up briefly
wywialm: benkay, re: if
there's no market for
the stuff at
the price,
the price must move for
the stuff
to move
TestingUnoDosTre: For example if
they own a large amount of btc and want
to protect against a big short
term drop in value
benkay: wywialm: what part of
the world is
that from?
wywialm: TestingUnoDosTre, but
that's changing
the unit of account :)
benkay: wywialm: what's
the root of your nick?
wywialm: TestingUnoDosTre, like what? indexing
to something else?
benkay: bitcoin will bring a rigor
to business unseen for centuries.
benkay: wywialm: if
there's no market for
the stuff at
the price,
the price must move for
the stuff
to move.
benkay: it will be interesting
to see it play out, but nobody knows how it is actually going
to play out.
wywialm: and
then it is not only filtered for value,
trade just goes down incredibly - we could go on claiming everything is fine, but
then unemployed resources appear en masse
wywialm: agreed, but
this effect can be really harmful in a much more developed economy, with credit, net of contracts, many competitors on a single markets
bitcoinpete: so under such conditions,
the economy is filtered for value
bitcoinpete: wywialm: from personal experience, when
the price is going parabolic,
there's little incentive
to spend bitcoin when
the good or service will be cheaper
tomorrow and
the need isn't dire
wywialm: sure, but i didn't want
to enter
this branch of discussion
benkay: note
that everything on mpex is btc-denominated.
benkay: wywialm: it's money as a unit account for
the bitcoin holders
that matter.
wywialm: not necessarily - after such 'pop'
there are usually calls
that
there was a bubble, but not every falling asset was a bubble previously
wywialm: demand for money, no bitcoin :) flight from assets
to cash.
wywialm: bitcoinpete, let's follow jurov and imagine
that somehow demand for money/bitcoin sharply increases. Would it be harmful
to general
trade conditions?
That is, would it generate a recession? If not, why?
ozbot: Computer simulations
teaching
themselves
to walk - Bizarre - YouTube
jurov: pankkake: market will solve
that nicely. miners will
take
the
txfee now instead of waiting for expiration
pankkake: no, you're not spending
that output, because I want
to grab it!
jurov: pankkake: but
then everyon knows
they are not lost
pankkake: though miners would
then be incentivized
to REFUSE
transactions
pankkake: that person can hoard by moving
the coins for free
wywialm: so, withholding money from circulation might have similar effects (and we believe
them
to be negative) as coin loss?
jurov: can you imagine someone hoarding and after 10 years
throwing in few millions btc
jurov: i
think it's more about stability of money supply
wywialm: i happen
to agree with you, especially considering bitcoin deflation argument, but if so, wouldn't e.g. printed-money-spending benefit economy as well in some cases?
wywialm: jurov, do you believe spending of criminals will benefit
the economy?:)
pankkake: bitcoin could work with md4.
the goal is
to brute force it, so it doesn't matter how broken it is
Apocalyptic: jurov, really
the criminal argument coming from you ?
jurov: In fact I
think having shorter delay, like 5 years would force criminals
to spend, benefitting everyone
TestingUnoDosTre: And its not like bitcoin owners won't be able
to
transfer value
to said systems
jurov: and
there will be muich bigger changes necessary much sooner
than 100 years, you really
think SHA-256 will resist so long?
jurov: it would be just a simple rule
that miner can
take 5 million blocks old unspent output(s).
Apocalyptic: some protocol
to recover 100 years untouched outputs will be agreed upon // unlikely
wywialm: so we could analyse economic impact of bitcoin being money, either now or some
time later
bitcoinpete: jurov: good point, hadn't
thought of
that. oh
the wonders of software
wywialm: bitcoinpete, legalistically, yes, but property and land could be money in economic
terms
jurov: i guess eiteher
they will be mined or some protocol
to recover 100 years untouched outputs will be agreed upon
numerisTrade: and bitcoins will reach a point when
they will be decreasing, due
to losses and so on
bitcoinpete: numerisTrade:
the irs' ruling of bitcoin as property is actually quite accurate and intelligent. bitcoin is far more like property overlooking central park
than
the dollars in our pockets
jurov: "they’re incinerating compatibility with upstream with a plasma
torch" lol
TestingUnoDosTre: Gunna subconsciously call bitcoins Picasso's now every
time I check my portfolio
bitcoinpete: numerisTrade: i imagine
that a currency whose supply is decreasing over
time wouldn't make for a very good currency. an example of
this would be
the picassos in
the world
today. over
time,
they're lost
to fires, floods, irreparable damage, etc. as such, no one defines picassos as currency just as no one sane defines bitcoin as money
numerisTrade: bitcoinpete, would
then *steadily shrinking* currency unharmful as well?
wywialm: Apocalyptic, when did
this
term get 'perverted' and why would it be an argument against defining it
that way?
bitcoinpete: benkay yup, pretty much. it's skill-gettin'
time
benkay: good bad who cares bitcoin is here
to kick
the ass of anyone who wants
to diddle
the number of currency units around
wywialm: bitcoinpete, we
try
to abstract from
them now. Without
this
tool no economic analysis would be possible
benkay: bitcoinpete: "whatever is is right"
to quote another poet.
bitcoinpete: we can't say
that increasing x is desirable because it correlates
to increased y without considering
the social and political impacts
Apocalyptic: wywialm, not really,
the standard definition is
the increase of
the money supply, or monetary base
wywialm: sure, but
that's fiscal effect of both. i
try
to focus on monetary effects
mod6: (10:01) <+pankkake> oh I loved BOFH! << me
too,
the old ones are best imho.
bitcoinpete: bitcoin and gold are checks on
tyrannical mobs
wywialm: to be even more clear, i generally agree with you
that under normal conditions of rising productivity, moderate deflation is very desirable
bitcoinpete: wywialm: history would seem
to say so. we'll see whether it rhymes
this
time 'round