Bitcoin a Sound Money: Save and Gain
Deflationary money would allow every individual to save and gain wealth.
The Current System…
Is a system that is theft incarnate — designed to keep individuals from gaining purchasing power via saving. When saving money is something we’ve been taught since childhood to be a wise decision and one that many of us keep on teaching the youngest of us. Yet, by not understanding how each step in the system works and pushing an incorrect narrative we doom those that are meant to be our future.
As a leader, I know first-hand that — in order for me to help in any way — all that I can do is provide high-quality information that I can. In the simplest, most digestible steps possible. After that, the power is in your hands to decide which system makes the most sense and which one seems the fairest.
I am only providing information.
The only way I know I can even attempt to help anybody is by providing the information, and my thought-processes. Leaving you as the individual to decide for yourself.
Pulling the conclusions from my article
“Extortion, Valuation Manipulation, and Rigging The System”
- America manipulated its citizenry to steal its gold reserves
- Hoarded and adjusted the pricing of gold after the heist, to increase profit
- Decoupled the dollar from gold reserves sending it free-floating in valuation
- Rigged the valuations of other currencies to prevent other countries from gaining against the USD
- The decoupling allowed the Federal Reserve to print at their heart’s content
- The unlimited money printer allowed stocks to become highly over-priced
- Central Banks pushed American Citizens and American Businesses to spend beyond their means, and take on more debt then they’re realistically capable of servicing
- Banks punish American Citizens for placing money in savings accounts with laughably minute interest rates, all while charging them for even holding funds in these accounts through hidden fees
- Big Business gets continuously bailed out for making stupid decisions, and then using the funds to pull their money from the market and then purchase small business that bleed into bankruptcy, increasing their market share of control indirectly
- Cost-of-living has inflated out of control
- Wages have not been kept up to the rapid pace of inflation
- The population growth rate is negative
- Retirees are pulling funds from the system through social security, under-funded pensions, IRA’s and 401ks being cashed out
That system doesn’t sound like a system that I want to be involved in, let alone suggest those that I care about get involved with.
Why would you want your loved ones to go play a game that is designed to prevent them from winning?
Inflationary vs Deflationary
The current system is inflationary. We have raised on the thought that “inflation is a good thing.” As the population swells, and more individuals enter the job/spending market we need more money in circulation to fill all of those bank accounts, right?
But then when you print more money to dump into circulation that devalues every dollar that is being held in checking accounts, wallets, safes, and mattresses. Every one of those dollars now has less purchasing power because the market share of that $1 dollar was decreased when the total supply was increased. When you take the fraction of (1/2) and increase the value of the denominator without increasing the numerator to maintain the status quo… you end up with a loss in value.
1/2 to 1/3 = 50% to 33.3%, resulting in a loss. “THAT’S WHAT INFLATION IS”in simplest terms*
More specifically it is classified as Demand-Pull Inflation. But imagine just how much less potent you and I’s dollars are when they are being printed on a trillions-at-a-time scale.
The funny thing is that many of us understand that the cost of goods (i.e. milk, clothes, gas) tends to react to inflation with increased cost. Now, there’s some supply vs demand mechanics at play as well but for the sake of argument, we’ll assume that S&D is in harmony. More money; the cost of goods goes up; the cost of living then goes up, rent goes up, utilities go up, BUT wages stay relatively the same. That right there is a net loss. MASSIVE net loss.
Now let’s look at deflation.
Deflationary systems are what the Gold Standard was. Money backed by a rare commodity that is deemed desirable by the market that nobody can print away. This commodity is rare by nature and requires effort to acquire it, causing its value to go up because of the work, the rarity, and the demand vs the supply.
Over time, as more and more individuals desire this commodity and fewer and fewer individuals are willing to sell — price goes up. And it goes up until sellers arrive at the market to allow values to change hands. As the market works its self through price discovery, the dollar is losing power against the commodity itself, but gaining in purchasing power vs goods & services on the market because the dollar is backed by the commodity. Allowing for individuals [and countries] to earn purchasing power in return for goods & services provided.
The US doesn’t like this because as we started out-sourcing labors, to maximize profit margins, and started consuming more than we were producing we began to diminish in value as a whole — crazy how a fair economy works huh?
Gold^= dollar < Gold (dollar gets weaker vs Gold),
*BUT* dollar > goods & services (dollar gains against goods & services because it’s backed by gold)
Which also brings into question technology. Tech is deflationary. New tech is expensive — we all know this. The latest iPhone? Hardly cheap.
BUT, as that tech becomes easier to attain and generic versions are made and the tech is mimicked, the higher standard of technology becomes THEE standard and thus cheaper.
Okay, let me gather my thoughts here;
- The US stole gold from its people, to make itself rich
- Central banks (i.e. Federal Reserve + The Treasury) gave themselves complete power over the U.S. Dollar
- Dollars are being inflated away
- Goods & Services are getting more expensive
- Housing and Utilities are getting more expensive
- Wages are stagnating, or depreciating
ERGO: everything is costing more, while the majority are making less
- How are the 1% not feeling the pain? As long as you hold assets, inflation SERVES you
- Robert Kiyosaki said it best; Assets put money in your pocket, Liabilities do the opposite. The house you live in is a liability, the house you rent out is an asset. Most Americans don’t own assets, they own liabilities. Meaning that most Americans are not gaining wealth, they’re hemorrhaging cash.
- Robert also amassed a great wealth by realizing that you can use debt to acquire assets back in the 80s. When you use debt like this long enough your profits out-pace your liabilities.
- OH I ALMOST FORGOT, all of those banks have also been telling you that spending is great — it’s great for the economy and to rack up that debt on that credit card. Take out that loan on that car/house that you clearly don’t have the means to actually own.
Deflationary money would allow every individual to save and gain wealth.
Save and Gain
Deflationary money (D-money) would allow you and I to gain wealth by just holding on to it. While our D-money sits in an account or under our mattress, and the market has more holders and buyers with fewer sellers, price continues to climb as more individuals desire the currency and have to increase bid-price in order to acquire what they desire. Our savings is accumulating value. Just like if you had a stockpile of gold.
Gold has a few issues. Gold is heavy, making it difficult to transport and change ownership. Trading in gold requires all parties involved to trust each other, or involve third parties to ensure that all parties involved act as agreed upon. Trading in gold, like dollars, requires a separate accounting system that involves a plethora of separate systems in itself.
Let’s break this down in a simpler format, a list 🙂
Exchanging in Gold:
- Heavy, physical effort is required
- Requires trust
- If trust is not incarnate, third parties are required
- Trust in the third parties are also necessary then
Exchanging via third party accounting:
- requires a system for account
- requires a system to handle transactions
- requires a system to store transaction history (a ledger)
- requires a system to provide the railways for information transfer
- requires a system for security of the accounts
- requires a system for security of the transactions
- requires a system for security of the railways of data transfer
Every single one of those points is not only handled by a separate party (some have the functioning to do more than one, yes), but also serves as an attack-vector. Or a point of vulnerability. When one central system handles all of the information, and then also requires multiple assisting systems to operate — each system requiring security for itself, as well as the whole — every single addition to that umbrella of networks becomes a security vulnerability. But what if it was distributed, and each distribution had to confirm with the others that it was the same?
Bitcoin does it all.
Bitcoin handles the accounting system, the ledger, the security, has a deflationary distribution system, the supply is capped at 21 million to every be minted, and is extremely easy to transport physically (via hardware wallet) and can be sent across the globe for a mere pittance — millions moving for only a few dollars while sending dollars via Western Union requires 30% of the total.
Here is a bit of a deeper dive:
A Bitcoin Economy
Would allow for every citizen to save and gain. We would all grow richer by simply not spending. Isn’t that how money is SUPPOSED to work? And with the capability to print money into oblivion out of anybody’s hands, EVERYTHING would stay a fair value.
Everyone saves. Everyone gains. Society is uplifted because everyone is positioned to be capable of economically gaining.
That’s the economy I choose to participate in.
Where you are rewarded for smart spending, and smart saving.Where you’re not encouraged to take on debt. (Debt is bad by the way, in case no one told you. Owing anything to anyone is a liability.)
The Bitcoin community is maintaining itself oh so well as a completely separate entity even now. Bitcoin has been running and operating since 2008, in the shadows of the MMT Giant, slowly rounding out its edges. This community has been providing funds to developers, that have been vetted by the members of this ecosystem, that wish to continue improving the core functionality and maintain the integrity of this system. This has been done via crowdfunding, where anyone in the world can send money directly to a Bitcoin wallet that was established to receive funding for developers. It is really a brilliant representation of what honest money allows honest members of a community to do.
I’ve been proud to be part of such an honest movement. An honest community that only wants to bring honest, trust-able money back to the board. By doing that we can cause a chain reaction across economies as well as social politics. Here is the whitepaper PDF for Bitcoin for all of you fellow needs out there.
About the author
Above article is contributed by Mike Hobart. You can follow him on Medium and Twitter.