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When I talk about stability of prices, what I mean is, if it costs X BC to buy a widget today, how many BC does the widget cost a year from now? If a widget costs me 10 BC today, 35 next week and 5 the week after that, it isn't doing a very good job as a currency, in my opinion.
And I'm not saying that BC is no good because it helps me buy illegal items. I'm saying it seems useless if I can't use it to go and buy groceries, or gas, or pay my mortgage, or whatever. And I know there is some gradual adoption of BC for ordinary goods, and so some day maybe it will be more useful. But the endless splintering into me-too "currencies" doesn't help.
It just seems to me that a lot of the excitement around this stuff is due to the investment angle or the philosophical angle. But in order to sustain itself, its eventually got to become more useful as a currency.
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Ken Utting wrote: If a widget costs me 10 BC today, 35 next week and 5 the week after that, it isn't doing a very good job as a currency, in my opinion.
In BC-terms, it would be 10 BC today, 11 the day after, then 13, back to 11 and up to 20. Now tell me you don't want your savings to do that 
Ken Utting wrote: I'm saying it seems useless if I can't use it to go and buy groceries, or gas, or pay my mortgage, or whatever. And I know there is some gradual adoption of BC for ordinary goods, and so some day maybe it will be more useful.
No, that may make it useless to you, but that does not affect anything else. So, what do you think may happen if it may become more of a mainstream-thing and demand multiplies by a tenfold?
Ken Utting wrote: It just seems to me that a lot of the excitement around this stuff is due to the investment angle or the philosophical angle. But in order to sustain itself, its eventually got to become more useful as a currency.
You mean like rise in price to show the inflationary effect, like gold would have were it not for the paper-gold in existence?
While you do not deem it usefull, others are using it
Bastard Programmer from Hell 
If you can't read my code, try converting it here[^]
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I think we're talking past each other. You keep talking about the price of BC; i.e. the conversion of BC and dollars. So I think you're thinking of BC as something you bought with your extra dollars and stuck in an account. If the value goes up over time, no matter how volatile it is, you're happy. To me, that means you're thinking of it as an investment.
And of course you're right. If BC goes mainstream and demand goes up tenfold, your investment in BC should do quite well. But I'm saying that for this to happen, it will have to function better as a currency.
I'm envisioning trying to use BC for everyday life, which is quite different than an investment, right? Here, volatility is a huge concern. No one wants the price of a loaf of bread to "be 10 BC today, 11 the day after, then 13, back to 11 and up to 20". And of course, you need to have a way to buy the loaf of bread without exchanging your BC for dollars every day.
And the reason I'm thinking of BC in this way is because, ultimately, that is what BC needs in order to go mainstream, right? It's not stock in a company that makes revenue, or a bond with some revenue stream behind it. Right now, BC seems to have a niche in unordinary goods, as well as the occasional pizza. But as an investor (I'm assuming you are), I'm sure you want it to expand its market, right? In order for BC to expand its market and grow in value, ultimately, it has to function well as a way to buy and sell ordinary goods every day.
Do you think BC can do that today? If not, what do you think will make that happen? What do you personally use BC for? Have you ever bought anything with it?
Cheers
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Ken Utting wrote: Do you think BC can do that today?
It is used like that today
Ken Utting wrote: What do you personally use BC for?
Amusement; I don't own any. I don't own any dollars either
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: Anything that is traded in a volatile market moves up and down fast
Currencies of first world nations do not. Exchange rates do not change by multiples in short time frames.
As an example one can look to the Chinese yuan versus US dollar. As China has become a economic world leader the rate is far more stable than periods years ago when its economy was less stable.
Dollar Yuan Exchange Rate - 35 Year Historical Chart | MacroTrends[^]
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jschell wrote: Currencies of first world nations do not.
Fiat currencies. The Euro is still called an "experiment".
jschell wrote: Exchange rates do not change by multiples in short time frames.
Thanks to central planning. In the span of 10 years inflation becomes rather visible.
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: Fiat currencies. The Euro is still called an "experiment".
No idea what that statement is supposed to mean.
The Euro, like every other first world nation currency has a specific government agency tasked with keeping it stable.
Eddy Vluggen wrote: Thanks to central planning. In the span of 10 years inflation becomes rather visible.
What?
Reasonable inflation which occurs in first world nations is expected and required. Deflation or no inflation would negatively impact the economies.
And if you are referring to hyper inflation that doesn't happen in first world nations. Or at least not in ones that remain a first world nation.
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jschell wrote:
No idea what that statement is supposed to mean.
Which part did you have trouble with? I'll gladly explain
jschell wrote:
The Euro, like every other first world nation currency has a specific government agency tasked with keeping it stable.
No, the ECB is not a government agency; our government here is Dutch, not European. There is no European law, no European passport, no European army.
jschell wrote:
What?
Reasonable inflation which occurs in first world nations is expected and required.
CPI might sound like it is in a reasonable range, but it still cuts your savings in a few years. Monetary inflation (M3) is a lot more than CPI. I'm not going to explain the difference between those forms of inflation, as I can safely assume you already know everything about them
jschell wrote: Deflation or no inflation would negatively impact the economies.
Strange, we had posters in school that claimed the opposite - google, and you'll find them too. The idea that I am going to stop eating and save my money for a year because bread will be cheaper by that time is academic nonsense.
jschell wrote: And if you are referring to hyper inflation that doesn't happen in first world nations. Or at least not in ones that remain a first world nation.
Of course, the Americans are multitudes more intelligent and financially enlightened than the Germans.
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: No, the ECB is not a government agency; our government here is Dutch, not European
The ECB is not private and it is not a charity. So pick what ever word you find suitable to define it. Doesn't alter the reality that it is used to facilitate stabilization but the independent governments of the EU also do that.
Eddy Vluggen wrote: The idea that I am going to stop eating and save my money for a year because bread will be cheaper by that time is academic nonsense.
Since I didn't say anything all even remotely related to that I will ignore it.
Eddy Vluggen wrote: Of course, the Americans are multitudes more intelligent and financially enlightened than the Germans.
You are claiming that the Germans are seeking to encourage hyper inflation?
Or are you claiming that Germany has no inflation? That certainly is not true. It does and has had a nominal inflation rate for a long time.
Historic inflation Germany – historic CPI inflation Germany[^]
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jschell wrote: The ECB is not private and it is not a charity. So pick what ever word you find suitable to define it.
"Bad idea" would be descriptive enough.
jschell wrote: You are claiming that the Germans are seeking to encourage hyper inflation?
No, just implying that you're too intelligent to make the same mistake.
jschell wrote: It does and has had a nominal inflation rate for a long time.
A targetted loss, before they handed inflation-targets to the ECB. With the Germans being part of the Euro-currency, their inflation is now equal to that of Spain and Italy - because according to some people, they're all alike 
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: "Bad idea" would be descriptive enough.
Irrelevant. My point remains that there is a specific group whose goal is to insure the stability of the Euro.
Eddy Vluggen wrote: No, just implying that you're too intelligent to make the same mistake.
Same mistake as what? Understanding that a moderate amount of inflation is natural and expected in a thriving economy? I do not see a mistake in that and nationality has nothing to do with it.
Eddy Vluggen wrote: their inflation is now equal to
that of Spain and Italy - because according to some people, they're all alike
Which appears to having nothing to do with what is being discussed.
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jschell wrote:
Same mistake as what?
"Whom", and the Germans. A question which happens to be answered by the pricing of our topic.
jschell wrote: Understanding that a moderate amount of inflation is natural and expected in a thriving economy? I do not see a mistake in that and nationality has nothing to do with it.
Nothing natural about it, and nothing natural about the 2% target.
jschell wrote: Which appears to having nothing to do with what is being discussed.
Do I really need to explain that the German inflation is linked to the Euro?
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: Nothing natural about it, and nothing natural about the 2% target.
I did not make any claim that goals were being realistically maintained nor even that target goals were appropriate.
Eddy Vluggen wrote: Do I really need to explain that the German inflation is linked to the Euro?
Apparently I need to explain that this sub-thread started with my point that national currencies are not as volatile and crypto currencies. And that includes the Euro.
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jschell wrote: I did not make any claim that goals were being realistically maintained nor even that target goals were appropriate.
No, but it does imply you prefer your currency (aka, saved labour) to depreciate.
jschell wrote:
Apparently I need to explain that this sub-thread started with my point that national currencies are not as volatile and crypto currencies.
Volatility to the upside. Yes, people would be shocked if they found out that their money keeps growing in value - imagine the horror
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: Volatility to the upside. Yes, people would be shocked if they found out that their money keeps growing in value - imagine the horror
I suggest that you put all of your money, investments, retirement and even checking account into crypt currencies then so you can guarantee the high life for yourself.
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I'm not, but the "volatile" argument is a bit nonsensical in that respect. It is not comparable to a currency that is volatile due to politics, nor stocks that are supposidly volatile.
Bastard Programmer from Hell 
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: I'm not, but the "volatile" argument is a bit nonsensical in that respect
Your previous point was that it was a good investment. Thus as an investment that should be the way that you go.
My point was and is that at a currency it is too volatile as a replacement for anything. It lacks the controls that modern currencies must have (and lack of controls are proven in history to be a problem.) And that has nothing to do with it being suitable or not as an investment.
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jschell wrote: Your previous point was that it was a good investment. Thus as an investment that should be the way that you go.
I have no spare to invest 
jschell wrote: It lacks the controls that modern currencies must have
The price-movement is mostly based on not having that control. It is market-driven, not controlled by a government or a bank.
How is some bureaucrat having "controls" going to improve on that situation?
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: The price-movement is mostly based on not having that control. It is market-driven, not controlled by a government or a bank.
Presumably my previous statements did not make it clear that I understand that.
Eddy Vluggen wrote: How is some bureaucrat having "controls" going to improve on that situation?
Because it keeps the volatility low. When I pick up a loaf of bread off the shelf and it says $2 it doesn't help me nor the market if the currency volatility increases that price to $4 by the time I get to the checkout.
Much less if I can't even get to my money when I get to the checkout.
A major vulnerability has frozen hundreds of millions of dollars of Ethereum | TechCrunch[^]
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jschell wrote: Because it keeps the volatility low. When I pick up a loaf of bread off the shelf and it says $2 it doesn't help me nor the market if the currency volatility increases that price to $4 by the time I get to the checkout.
You wouldn't complain if the price is $1, and neither would the grocer if that means that the value of his cash-register doubles.
You yammer about volatility, but only for the currency that is appreciating, and claiming that the depreciating currencies would be better 
jschell wrote:
A major vulnerability has frozen hundreds of millions of dollars of Ethereum | TechCrunch[^]
Aren't you glad a decent argument came along, eh?
Yes, one takes that risk with technology.
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: You wouldn't complain if the price is $1, and neither would the grocer if that means that the value of his cash-register doubles
How is that relevant to my example?
Eddy Vluggen wrote: and claiming that the depreciating currencies would be better
Wrong.
I did not say that. I am rather certain that I specifically said that wasn't true in other posts.
Eddy Vluggen wrote: Yes, one takes that risk with technology.
And my point in this long thread is that in terms of my personal life and in every historical economy analysis that I have seen no one wants nor considers that sort volatility a good thing in currency.
The risk and the volatility are problems.
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jschell wrote:
How is that relevant to my example?
It explains how it is nonsense
jschell wrote:
Wrong.
I did not say that. I am rather certain that I specifically said that wasn't true in other posts.
Yes, you did - the (upward) volatility of BC is bad, and so, the alternative being only depreciating (inflating) fiat..
jschell wrote: And my point in this long thread is that in terms of my personal life and in every historical economy analysis that I have seen no one wants nor considers that sort volatility a good thing in currency.
You want to paint it "volatile" - that is not the same. The silver-price is volatile as it is unpredictable and varies wildly. BC is not volatile, it is in a rally - while all other fiat-currencies are racing to the bottom.
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: Yes, you did - the (upward) volatility of BC is bad, and so, the alternative being only depreciating (inflating) fiat..
I did not. I said, again repeating what I said....
Drastic up or down turns is currency is bad. Period.
No increases or modest down turns in currency is considered not ideal. Especially if it continues.
Modest increases in currency is considered the ideal. This is not to say exactly what value 'modest' represents.
Eddy Vluggen wrote: You want to paint it "volatile" - that is not the same. The silver-price is volatile as it is unpredictable and varies wildly. BC is not volatile, it is in a rally - while all other fiat-currencies are racing to the bottom.
If you are unclear what it means when I say volatile then I suggest you read up.
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...and many others.
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jschell wrote: Drastic up or down turns is currency is bad. Period.
Drastic up does not seem so bad if you're the one holding it. You keep painting that as volatility
Bastard Programmer from Hell
If you can't read my code, try converting it here[^]
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Eddy Vluggen wrote: Drastic up does not seem so bad if you're the one holding it. You keep painting that as volatility
A drastic uptake in a national currency IS bad. If an Venezuelan oil tanker is about to off load a supply of oil to Syria and the payment is supposed to be in US dollars and the dollar goes up 1000% just before offload occurs exactly how much is going to be paid? Syria does not want to pay the original amount because they are now, in real terms, paying ten times as much. But Venezuelan does not want to take a 10% payment because, as a payment, they were expecting the buying power that the original payment represented.
Those sort of tends extend throughout the entire economy. They impact supply lines, worker compensation, service costs, etc.
Even worse if it drops 2000% the next day.
That means that no one is willing to make long term plans. That is exactly what happens with hyperinflation. It isn't that devaluation is occurring with hyperinflation but rather the uncertainty. If the inflation rate was guaranteed to be 10% a week, then they can deal with that. But when they have no idea what it will be a week much less than a month then economy crashes because expenditures can only be initiated on an immediate basis.
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