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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (157359)	5/2/2020 9:06:52 PM
From: sense	Read Replies (1) \| Respond to of 218201

Does this demonstrate the need for a digital currency?. It demonstrates the exact opposite... the need for FUNCTIONAL currencies which avoid the pitfalls of external control of supply... which is intrinsically disconnected from local concerns and local needs. The function in money is not different than other things that are centralized in excess... The farther away from the concern and the need... the less practical utility the centralized organization has locally. That's the whole point of fiat ? To take the money everyone uses... and restrict its control and the benefits of control... to a small self interested group. The article errs in mixing apples and oranges, though, in its consideration of inflation, by ignoring too much the deflationary impacts of too little money in the system to lubricate the local economic function... while wrongly equating inflation and deflation as opposites... which they are not... Inflation... an excess of currency being provided, resulting in depreciation of the currency... Deflation... an insufficient amount of currency being provided, resulting in appreciating currencies... ? But, that still ignores "flows"... as who a currency, once it is created, is provided to... and what they do with it... makes a huge difference... If the Fed prints piles of money... and the banks sit on the piles, maybe share a bit of it with a few friends, but otherwise refuse to let it change hands, or flow out to do any work in the real economy... then, inflation occurs where those dollars flow (stock market)... and deflation occurs where they do not flow... ( local and regional variation in flows driving local impacts: inhibition of activity broadly, that is only partially measured as a lack of jobs, waning innovation, reduced new business creation) ? What you get when "inflationary excess" money flows are restricted... is localized inflation paired with localized deflation... showing as a divergence in wealth occurs, as wealth transfers, the benefits all being tied to proximity to the flow. Deflation... doesn't require a change in "value" of the money, inflated or not... as the lack of it where it is needed simple prevents or ends economic activities. What's the measured price of goods and services not produced because of insufficient liquidity in the money supply ? How do you measure what would occur, that doesn't, only because it requires there to be an extant flow of money giving an ability to foster the trade ? If there's not enough money... it alters what people do... making them non-productive... but it also alters what people will use that too little bit of money that is available for ? Local currencies... are (or can be) a localized hypothecation of other currency, that functions locally... enabling localized liquidity sufficient to have the lack of liquidity not suppress activity for lack of currency... thus obviating the external imposition of limits... overcoming shortages... to sustain local economic activity at a higher level than would be possible with too little externally supplied money to keep the local system of money liquid enough to be functional... Growing Economies with Local Currencies: History shows that local currencies can work, and aren’t ravaged by the inflationary trends that affect our current money supply. Inflation functions... don't change ? The article gets that wrong. Print too much local currency... get inflation locally... and a wealth transfer effect locally... tied to who gets the money and who doesn't ? The U.S. dollar is the world's reserve currency... but lots of other nations have local currencies... which don't prevent them having inflation ? Mis-manage a local currency... and guess what... it under-performs. Local currencies: The wasted opportunities The history of local currencies... gives a much better view of why and how it is that a distant power center seeks to extract value from the periphery rather than facilitate larger value creation that otherwise has a potential to occur entirely outside that control... U.S. history has a lot to consider... the lack of a sufficient supply of money in the west was a constant problem on the frontier... Western territories and states issued their own money, just so there was some... as without it, economic activity slows down significantly...