Should we put the US Treasury on blockchain?

[Tom Paris]

I love poking my head into a thread where people think they’re super smart. Thanks boyz!

This topic is above my paygrade so no comments from me.

 

[BioHawk]

That’s a feature of capitalism.

Printing money doesn’t increase productivity, it just abrogates purchasing power because supply and demand are relative.

Do you think economic progress would stop if counterfeiting weren’t just illegal, but completely impossible?

So now you think that when the government prints more money it's counterfeit? Seriously, what other countries still use Gold to back their currency? You'd think if it were this great, all powerful economic idea then some other country would use it.

I just googled it. And the list of countries that use the Gold Standard is....zero. Literally zero other countries use it. I mean, if you want to have someone kick you in the balls every day just because you like to make life painful, I won't judge you. But you don't get to bring everyone with you.

 

[NorthEndzoneCrew]

As others have said, having treasury utilize block chain technology isn’t a bad idea.

However, switching treasury to crypto currencies would be awful for most Americans

 

[seminole97]

So now you think that when the government prints more money it's counterfeit?

I’m saying the net economic benefit to printing money is zero.
It simply moves purchasing power to the printer (whether he is a counterfeiter, or runs the central bank), by reducing the purchasing power of those who already hold the currency.

Seriously, what other countries still use Gold to back their currency?

None. Politicians absolutely love being to spend more than the public is willing to bear in taxes, and printing money enables them to seize purchasing power without taking money out of the public’s pocket. It’s a regressive tax, but because it is hidden the politicians can blame companies for the resulting price increases (accommodating the reduced value of the currency).

You'd think if it were this great, all powerful economic idea then some other country would use it.

Again, politicians love being able to spend without (visibly) increasing taxes.
That desire far exceeds their concern for your wellbeing.

I just googled it. And the list of countries that use the Gold Standard is....zero. Literally zero other countries use it. I mean, if you want to have someone kick you in the balls every day just because you like to make life painful, I won't judge you. But you don't get to bring everyone with you.

The ‘kick in the balls’ is coming from the central bank devaluing the money you have saved by printing more to give to politicians to spend.

Federal Reserve Chairman in 2002:

The conclusion that deflation is always reversible under a fiat money system follows from basic economic reasoning. A little parable may prove useful: Today an ounce of gold sells for $300, more or less. Now suppose that a modern alchemist solves his subject's oldest problem by finding a way to produce unlimited amounts of new gold at essentially no cost. Moreover, his invention is widely publicized and scientifically verified, and he announces his intention to begin massive production of gold within days. What would happen to the price of gold? Presumably, the potentially unlimited supply of cheap gold would cause the market price of gold to plummet. Indeed, if the market for gold is to any degree efficient, the price of gold would collapse immediately after the announcement of the invention, before the alchemist had produced and marketed a single ounce of yellow metal.

What has this got to do with monetary policy? Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation.

Of course, the U.S. government is not going to print money and distribute it willy-nilly (although as we will see later, there are practical policies that approximate this behavior)


COVID spending binge certainly met the technical definition of 'willy-nilly'.

Today, an ounce of gold sells for over $2800.

Do you understand his parable, and what they're doing to the value of our money? Do you think that somehow benefits you?

 

[seminole97]

Which was precisely his point.

Printing money doesn’t increase productivity, so he had no point.

 

[Urohawk]

I think Elon is well on his way to becoming disliked by most Americans. He'll get the boot before long.

I own a Tesla because it's a great car, supports the environment, and employs American workers more so than any other vehicle in terms of % built in the USA. I used to say I won't let a CEO get in the way of the overwhelming benefit of a company. I think the first month of the presidency has made me concede that I will probably never buy a car from them again due to him being a total dick.

 

[BioHawk]

I’m saying the net economic benefit to printing money is zero.
It simply moves purchasing power to the printer (whether he is a counterfeiter, or runs the central bank), by reducing the purchasing power of those who already hold the currency.



None. Politicians absolutely love being to spend more than the public is willing to bear in taxes, and printing money enables them to seize purchasing power without taking money out of the public’s pocket. It’s a regressive tax, but because it is hidden the politicians can blame companies for the resulting price increases (accommodating the reduced value of the currency).




Again, politicians love being able to spend without (visibly) increasing taxes.
That desire far exceeds their concern for your wellbeing.



The ‘kick in the balls’ is coming from the central bank devaluing the money you have saved by printing more to give to politicians to spend.

Federal Reserve Chairman in 2002:

The conclusion that deflation is always reversible under a fiat money system follows from basic economic reasoning. A little parable may prove useful: Today an ounce of gold sells for $300, more or less. Now suppose that a modern alchemist solves his subject's oldest problem by finding a way to produce unlimited amounts of new gold at essentially no cost. Moreover, his invention is widely publicized and scientifically verified, and he announces his intention to begin massive production of gold within days. What would happen to the price of gold? Presumably, the potentially unlimited supply of cheap gold would cause the market price of gold to plummet. Indeed, if the market for gold is to any degree efficient, the price of gold would collapse immediately after the announcement of the invention, before the alchemist had produced and marketed a single ounce of yellow metal.

What has this got to do with monetary policy? Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation.

Of course, the U.S. government is not going to print money and distribute it willy-nilly (although as we will see later, there are practical policies that approximate this behavior)


COVID spending binge certainly met the technical definition of 'willy-nilly'.

Today, an ounce of gold sells for over $2800.

Do you understand his parable, and what they're doing to the value of our money? Do you think that somehow benefits you?

So, inflation. That's why you want to make it impossible for governments to adjust monetary policy to be able to respond to emergencies and have less flexibility. Yeah, I like the world we live in far better than the one you are dreaming up here.

 

[hexumhawk]

The tech itself is good and the idea behind crypto currencies are good. However, I don't want government to have that level of control to turn on and off your money as they see fit.

 

[seminole97]

So, inflation. That's why you want to make it impossible for governments to adjust monetary policy to be able to respond to emergencies and have less flexibility. Yeah, I like the world we live in far better than the one you are dreaming up here.

Why do you think the regressive tax of inflation is preferable to honest (market) interest rates and actual taxation?
The government can still spend to Congress desire, it’s just that the cost would be open and acknowledged, instead of hidden and inherently regressive.
The only ‘advantage’ to inflation as fiscal policy is hiding from the public the politicians true appetite for their wealth, and the boon to the rich of increasing asset prices (which fuels the wealth disparity that people claim to hate).

 

[seminole97]

The tech itself is good and the idea behind crypto currencies are good. However, I don't want government to have that level of control to turn on and off your money as they see fit.

They already have that power over the existing banking infrastructure.
Are you unfamiliar with Operation Chokepoint 1.0 and 2.0?
The last two Democratic administrations, without court orders, leaned on banks to refuse customers service, or face costly investigations.

 

[BioHawk]

Why do you think the regressive tax of inflation is preferable to honest (market) interest rates and actual taxation?
The government can still spend to Congress desire, it’s just that the cost would be open and acknowledged, instead of hidden and inherently regressive.
The only ‘advantage’ to inflation as fiscal policy is hiding from the public the politicians true appetite for their wealth, and the boon to the rich of increasing asset prices (which fuels the wealth disparity that people claim to hate).

You really think that with a finite amount of money that rich people wouldn't still rig the system to be able to control most of it? The only difference is when a hurricane wipes out Florida the government would have to beg them for money to help. There needs to be a major change in tax policy unrelated to the standard we are on.

 

[seminole97]

You really think that with a finite amount of money that rich people wouldn't still rig the system to be able to control most of it?

Even the central banks own research demonstrates that inflation increases wealth disparity.
It would exist, because of a multitude of reasons, but inflation makes it worse than it would otherwise be.

The only difference is when a hurricane wipes out Florida the government would have to beg them for money to help.

Governments don't beg.
They borrow and they tax.
Not allowing them to print just stops a regressive form of taxation that increases wealth disparity.
The government can still borrow, and can still tax outright.

There needs to be a major change in tax policy unrelated to the standard we are on.

We already have a progressive tax system, with those in the top half of earnings paying a larger share of taxes than their share of earnings.
We just need to end the policy that regressively taxes the bottom half of earners deeper into poverty.

 

[Moral]

You really think that with a finite amount of money that rich people wouldn't still rig the system to be able to control most of it? The only difference is when a hurricane wipes out Florida the government would have to beg them for money to help. There needs to be a major change in tax policy unrelated to the standard we are on.

Whales or big stake holders already own the majority of crypto. .1% of whales own about 60% of crypto. It's a hell of a Ponzi if you get in at the right time. For all of that money to escape the system they would need additional "investors" whether it be the US government or some degens to put in enough money to create exit liquidity. Of course if they actually did pull their money out the exit liquidity for everyone else would be gone unless they recruit more suckers to "invest."

Crypto still doesn't have a real utility use other than dark web drugs, illegal porn, weapons, and murder for higher. Blockchain remains largely unadopted. People still don't understand crypto. The reason you see crypto machines in stores is to make it appear as if it is a viable and hope for.lore adoption. The transaction fees terrible compared to fiat and slow.

Oh and ransomware and extortion schemes, I forgot that use case above.

 

[BioHawk]

Even the central banks own research demonstrates that inflation increases wealth disparity.
It would exist, because of a multitude of reasons, but inflation makes it worse than it would otherwise be.

If you have capitalism, you will always have wealth disparity. It's pretty much fundamental to the system. The trick is to not allow the wealthiest people to have too much of it, a condition that we have been in since the 80's, really, but it didn't become destabilizing until after 2010 when the Supreme Court legalized bribery.

Governments don't beg.
They borrow and they tax.
Not allowing them to print just stops a regressive form of taxation that increases wealth disparity.
The government can still borrow, and can still tax outright.

Sorry, ""f**k you, the bank won't loan us any money"" isn't something I ever want to be a possible response from the government. If there isn't faith that the government will be able to help you then you won't have a government at all. As we are soon to find out.

We already have a progressive tax system, with those in the top half of earnings paying a larger share of taxes than their share of earnings.
We just need to end the policy that regressively taxes the bottom half of earners deeper into poverty.

LOL, the tax system used to be progressive but Reagan, Bush, and Trump have eliminated any pretenses of that Clinton managed to get it back (with some help from Bush Sr.) for a few years and managed to balance the budget with it. Then Bush Jr. came in and put deficits on hyperdrive. At least until Trump put deficits on ludicrous speed. Of course, both Obama and Biden get criticized for the spending they did to deal with national emergencies (responses that would have been virtually impossible in a gold standard ) brought on by the wreckless practices of their predecessors. Whatever issues you have with the current economic system seem to be brought on by the way Republicans have tried to break it, not because of the system itself. It's a shame that you've been suckered into hating the system because of what they did when that was their goal in the first place.

 

[seminole97]

If you have capitalism, you will always have wealth disparity. It's pretty much fundamental to the system.

100% agree. Some people do things that build wealth better than others, and that will always be the case. Even if you could make everyone's circumstances the same, folks will make different choices and have different outcomes.
My point is that inflation exacerbates wealth disparity, for no net economic benefit. Just to the benefit of the recipients of the newly created cash, and the people who already own assets denominated in that cash at the expense of everyone else.

The trick is to not allow the wealthiest people to have too much of it, a condition that we have been in since the 80's,

Broaden your analysis a little bit.
The 'break' came in 1971, when Nixon broke 'full faith and credit' in the U.S. Federal Reserve Note and it stopped being redeemable for a specific weight of gold.

Sorry, ""f**k you, the bank won't loan us any money"" isn't something I ever want to be a possible response from the government.

Money is always available to borrow, at honest interest rates.
What you're saying is you want to hide (not obviate!) the cost of borrowing from the public, by faking interest rates and taking their purchasing power secretly, but more importantly, regressively.
Why?

LOL, the tax system used to be progressive but Reagan, Bush, and Trump have eliminated any pretenses of that Clinton managed to get it back (with some help from Bush Sr.) for a few years and managed to balance the budget with it.

LOL
Dead ass wrong. Like Reagan said, 'The trouble with our Liberal friends is not that they're ignorant; it's just that they know so much that isn't so.'

In fact, I'm willing to make an avatar bet with you right now on whether or not the income tax system is more progressive today than it was when Reagan took office.

1 year, winner has choice of the loser's avatar.

Do you really believe what you typed? Let's see.

 

[BioHawk]

100% agree. Some people do things that build wealth better than others, and that will always be the case. Even if you could make everyone's circumstances the same, folks will make different choices and have different outcomes.
My point is that inflation exacerbates wealth disparity, for no net economic benefit. Just to the benefit of the recipients of the newly created cash, and the people who already own assets denominated in that cash at the expense of everyone else.

Ugh. You aren't wrong under the current system of letting rich people have bigger tax cuts so they can bury their gains in the stock market and not pay their workers more. It doesn't have to be that way though.

Broaden your analysis a little bit.
The 'break' came in 1971, when Nixon broke 'full faith and credit' in the U.S. Federal Reserve Note and it stopped being redeemable for a specific weight of gold.

There isn't one factor that caused this, way too complicated to narrow down to one graph.

Money is always available to borrow, at honest interest rates.
What you're saying is you want to hide (not obviate!) the cost of borrowing from the public, by faking interest rates and taking their purchasing power secretly, but more importantly, regressively.
Why?

Because they can and it is the least disruptive way of doing that.

LOL
Dead ass wrong. Like Reagan said, 'The trouble with our Liberal friends is not that they're ignorant; it's just that they know so much that isn't so.'

In fact, I'm willing to make an avatar bet with you right now on whether or not the income tax system is more progressive today than it was when Reagan took office.

1 year, winner has choice of the loser's avatar.

Do you really believe what you typed? Let's see.

Yeah, I don't do bets and this doesn't seem like a debate that is "winnable" as there is literally nothing I can say that will ever convince you that you are wrong. I mean, I doubt we even agree on exactly what a "progressive" tax system is.

 

[seminole97]

There isn't one factor that caused this, way too complicated to narrow down to one graph.

You can find the ‘break’ occurring then across lots of graphs.

Because they can and it is the least disruptive way of doing that.

Politically, I agree it’s the least disruptive. Most people don’t understand what is happening, and the politicians can just point at ‘greedy corporations’ for the increase in prices and in doing so they manage to skate on responsibility in proportion with how uninformed society is regarding cause and effect.

Economically and socially inflation is very disruptive.

Yeah, I don't do bets

Ok, I figured you didn’t believe what you wrote.

and this doesn't seem like a debate that is "winnable" as there is literally nothing I can say that will ever convince you that you are wrong.

You won’t be able to convince me I’m wrong because the math is on my side.
The question is simply one of resolving your ignorance.

I mean, I doubt we even agree on exactly what a "progressive" tax system is.

Do you agree with this definition:

A progressive tax takes a larger percentage of income from high-income groups than from low-income groups and is based on the concept of ability to pay.

 

[BioHawk]

You can find the ‘break’ occurring then across lots of graphs.

Politically, I agree it’s the least disruptive. Most people don’t understand what is happening, and the politicians can just point at ‘greedy corporations’ for the increase in prices and in doing so they manage to skate on responsibility in proportion with how uninformed society is regarding cause and effect.

Economically and socially inflation is very disruptive.



Ok, I figured you didn’t believe what you wrote.



You won’t be able to convince me I’m wrong because the math is on my side.
The question is simply one of resolving your ignorance.



Do you agree with this definition:

A progressive tax takes a larger percentage of income from high-income groups than from low-income groups and is based on the concept of ability to pay.

This is exhausting and I don't have the energy. Fine, you win. Congrats.

 

[seminole97]

This is exhausting and I don't have the energy. Fine, you win. Congrats.

**** that, I'm not going to let you go on ignorantly spreading disinformation.

This is the lie: "LOL, the tax system used to be progressive but Reagan, Bush, and Trump have eliminated any pretenses of that"

Can you read this, or do you need it explained to you?