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Comment by bmitc | Hacker News Reader

Has the Federal Reserve always been this powerful and active? Over the past few years, it seems that they have been molding the economy to their will. Are there any detailed retrospectives on this in terms of it being good or not? From my naive perspective, it seems like a lot of meddling, and it isn't clear if such frequent changes are required. If they are required, I suppose that bothers me just as much since it implies a fragile economic system.

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This is just the Fed setting interest rates to be in line with the Taylor Rule [1]. As some of your replies have noted, they're aggressive both because of a delayed response to recent inflation as well as a sharp rise in inflation since the COVID lockdowns ended.

Note that the Fed has two mandates: maximum employment and price stability. They raise rates in an attempt to reduce inflation and try to reach price stability. Their tools for maximizing employment tend to be much more indirect.

[1] https://www.atlantafed.org/cqer/research/taylor-rule / Create Your Calculation / Chart / Compare "Alternative 3" and "Actual Fed Funds Rate"

> the Fed setting interest rates to be in line with the Taylor Rule

No, it is not. The Taylor rule was proposed as a starting point for discussing a model. The coefficients were chosen for consideration and to "capture the spirit of recent research" [1]. Computational advances rendered obsolete the essentially two-factor model.

[1] https://web.stanford.edu/~johntayl/Papers/Discretion.PDF

Phrased more cynically the goals of price stability and maximum employment may be phrased as: Suppress wages and prevent workers from attaining financial independence / retiring at a young age.

> the goals of price stability and maximum employment may be phrased as: Suppress wages and prevent workers from attaining financial independence / retiring at a young age

Economies with runaway wage inflation feature none of this.

Sure, if you only look at "runaway" inflation and decouple wages from real economic growth. However, the present growth in wages has been backed by increased productivity. The Fed has been open about the fact that it intends to slow productivity itself.

Fed has been open about the fact that it intends to slow productivity itself (pulling sources now...)

> Fed has been open about the fact that it intends to slow productivity itself

Source?

More productivity is always good as it promotes growth while fighting inflation (similar number of dollars chasing more goods).

These first couple aren't from the Fed directly, but: https://www.washingtonpost.com/business/2022/09/20/fed-inter...

> Higher rates ... are designed to slow the economy by dampening consumer demand.

> The Fed can’t do anything to boost chip manufacturing or build more houses, which would fix the supply side of the equation. So it has to focus on slowing down demand instead. It wants fewer people to buy new cars or put in bids for houses,

https://www.levyinstitute.org/publications/why-does-the-fed-...

https://fortune.com/2022/03/17/fed-slowdown-rates-economy-in...

Interpreting the Fed's own statements take a bit of critical reading since they're both open about it, but also aware that most of the public would have a different view if they heard and understood what was being said. So, their wording remains cautious: https://www.federalreserve.gov/newsevents/speech/cook2022113...

> When firms see rising output per hour, they have room to keep prices low. For consumer goods, this can help lower inflation.

Here the Fed demonstrates a preference that the value produced by increases in productivity shouldn't go to labor, but that their share of value should be reduced to keep prices low (aka a wealth transfer from labor to capital).

Then: https://www.federalreserve.gov/newsevents/speech/waller20221...

> I will begin with some comments on the overall outlook for economic growth and then try to explain how tighter monetary policy this year is intended to dampen demand and put downward pressure on inflation.

Here the Fed refers to wage growth and inflation as interchangeable, but even if you disregard that they state a goal of dampening demand. Perhaps the ends justify the means in terms, but it should be acknowledged that both supply and demand feed productivity. Dampening demand is tantamount to the Fed shutting down factories and keeping employees off of work. The demand for goods and services exists because they are needed inputs into other aspects of the economy. The goal is not to facilitate a productive economy, but to facilitate a stable one even if that means reducing productivity.

Is there any economy that you are aware of that had high wage inflation without inflation in everything else? Wage inflation alone would be great for the average worker, but wage inflation plus equal general inflation is at best a wash, and much worse for retirees who can't take advantage of those rising wages.

The US economy is a great example, just look at the historical real GDP growth. The cost of goods, houses, cars, etc. have all increased over the past 200 years, but few would say that our standard of living has decreased.

The U.S. economy has not had "high" inflation (there were spikes here and there, but over the long run inflation has been quite moderate). That's kind of the whole point of what the Fed is doing, preventing inflation from running away and causing major problems.

> Is there any economy that you are aware of that had high wage inflation without inflation in everything else?

'Inflation' isolated to wages is called wage growth. Every developed country has gone through a period of wage growth.

When you define the qiestion negatively, with 'wage inflation', the answers you get will be negative

This is a wildly uninformed take. While some workers may benefit from inflation, price instability is more likely to benefit corporations and hurt consumers even more, hence why the left is meming about record corporate profits. Unemployment is the measure of people who are actively seeking a job, but can't find one. Financially independent people don't count as unemployed.

Wage Growth != Inflation. Wage Growth = Value / Share++ (i.e. workers obtain a larger share of value generated by their work) Inflation = Shares++ / Value (i.e. the same value is split into more shares / dollars)

Maximum employment != minimal unemployment. Maximum employment == maximum labor force participation + minimal unemployment.

The Fed's dual mandate is to "maintain price stability" and to "ensure maximum stable employment", both of which are only accomplished through explicit manipulation of the economy. They're an enormously powerful entity, and if they're actually accomplishing their goals, do help keep the economy running smoothly (most specifically, IMO, by improving the confidence of people to make long-forecast economic decisions), but when they get it wrong, they have the potential to cause damage at a scale nearly unrivaled by anyone else.

> both of which are only accomplished through explicit manipulation of the economy.

You can't have an unmanipulated economy the same way you cant have food without chemicals - sugars, vitamins, micronutrients, water - they are all chemicals.

The same in the economy - money supply, interest rate, etc. do not 'just appear', they are 'manipuled', whether by banks, FED or someone else. Someone has to issue currency and run the system

You shouldn't be asking wether the system is managed, you should be asking in who's interest it is managed.

They are particularly active right now because they took too long to start raising rates to begin with, and are now kind of frantically correcting. Given the circumstances I don't think there's much else they can do; they should have started gently raising rates in the spring or summer of 2021 and then the current intervention might not have needed to be so dramatic, but we can't undo the past.

They tried gently raising rates before that (2018-ish, maybe?) and the market freaked out, so they backed off.

> "Molding the economy to their will"

The thing to remember about central banking is that it's a relatively immature art, not science, and its practitioners are still refining the toolset. As a kid, I think one grows up just assuming they know what they're doing and that it's a pretty solid practice, but not so. You see them molding the economy to their will, but I see a bunch of people with gritted teeth and high blood pressure reactively trying to steer an out-of-control stagecoach whose horses are running at full tilt with their manes on fire down a country road with blind turns, giving it their all to keep it from crashing violently. They apply lessons learned but I think that every major economic event is still largely an experiment, and occasionally they still make the wrong moves leading to a need to apply harsh corrections.

Give it another 100 years and maybe all the permutations will have been seen and the solution sets known, but it's a terribly complex beast, complicated by radically higher global entanglement in the prior 50 years. The question is, is it better than the alternatives. I think if expectations are realistically low, it is better to have some knobs and dials that you can monkey with to try and control speed and direction.

Just my .02 (which is seemingly worth less each day).

It's an unambiguously nauseating way to control the lives of billions of humans.

We'd be much better off letting banks decide how much they value your deposits, and having a currency that politicians, bureaucrats and bankers can't manipulate.

But alas.

> having a currency that politicians, bureaucrats and bankers can't manipulate.

Which is what, Gold? Bitcoin? Have you read the history of merchantilism and how Britiah and Dutch economic growth was restricted by supply of silver?

The definition of a Fiat currency is that it can be manipulated by whoever is issuing it

Probably Bitcoin. Gold would be fine if there weren't governments.

> From my naive perspective, it seems like a lot of meddling, and it isn't clear if such frequent changes are required

The federal reserve has exactly 2 mandates: keep prices stable (which they define as a long term inflation of 2%) and reduce unemployment.

Unemployment is low, inflation has been far beyond 2%, so the goal is obvious.

There’s a technical questions of “how many rate hikes” and “how steep per hike”. But the direction that the federal reserve has been moving is more or less directly implied by their mandate.

> If they are required, I suppose that bothers me just as much since it implies a fragile economic system.

I’m not sure I agree. On what basis does this imply a fragile economic system? The federal reserve has a tool to achieve their goals, and they are using that tool.

> Unemployment is low, inflation has been far beyond 2%, so the goal is obvious.

But isn’t the current inflation because they printed money out of thin air for nearly two years to push markets well beyond all times highs? Their methods feel more akin to filling up a dam’s holes with bubble gum rather than something more foundational. It seems like a lot of rubber banding.

In my experience on the ground, all they’ve done is destabilize investments, prices, and inflation.

> But isn’t the current inflation because they printed money out of thin air for nearly two years to push markets well beyond all times highs?

Essentially yes (although some amount of that is out of feds scope - see federal stimulus and PPP, decided by the legislative branch).

At the beginning of the pandemic inflation was low (the fear was deflation) and unemployment was at extreme highs.

> It seems like a lot of rubber banding.

You aren’t wrong but the pandemic was a black swan event and society’s response to the pandemic was unprecedented (basically shutting down economic activity, some economic sectors like office real estate fundamentally altered to this day).

I don’t think there was an easy way out and, all things considered, my opinion is the federal reserve (and lawmakers) did a pretty good job of keeping our economy from imploding.

Let’s put it another way: the federal reserve is a control system, and that control system was pushed to the boundaries. Any good control system is going to get some rubber banding to recover from this scenario.

The risk of runaway unemployment/deflation was too great in 2020, the risk of runaway inflation is too great now.

Yes, here is a chart of their activity in setting the Federal Funds rate since the 1950s (https://fred.stlouisfed.org/series/FEDFUNDS). It is only, in very recent years (from 2008 to 2015), that the rate has stayed unchanged for so long.

Yes, the Fed manages the US economy, and that’s been its job for over a century. Maybe read about Volker and the 1982 recession.

Whether they do a good job or not and what they should do instead is often debated by economists.

And yep, economies aren’t self-managing. Before that there were frequent financial panics.

They’re a banking cartel that controls the supply of the world’s reserve currency.

Yes they’ve been active and powerful for a long time.

Paul Volcker's Fed raised rates from 11.2% to 20%, which is widely credited as a major cause of the 1980-1982 recession. https://en.wikipedia.org/wiki/Paul_Volcker#Chairman_of_the_F...

Edit: probably should have clarified I think this was probably worth it (inflation came down and stayed down for a long time, and you can’t postpone a recession forever with dovish policy. My only point is that it was a big intervention).

And of breaking the back of the inflation that we had in the 1970s.

Paul Volcker was widely credited for stopping the rampant high inflation of the 70's. Volcker is one of the greatest Fed chairs around.

Since 2008, the whole economy of the western world has been reliant on central banks to provide capital for free (or even less than that). The fact they are withdrawing that (or trying to) is what makes them suddenly seem powerful. Once we're back to a more normal (in a century point of view) world, they will manage much less. But right now, they are the ones supplying all the capital for everything...

I would say yes, but perhaps not as visible.

Before the internet arrived and provided anyone to become an 'expert' in anything, it was still their job to manage the monetary system and employment.

I'd say the issue now is that many popular haunts on the internet are designed to incite rage, and the Fed is always going to be unpopular when they have to cool things off in the economy.

See Alan Greenspan's entire tenure as Fed Chair.

Most Fed chairs who're around for a recession become a household name, at least for a little while. Which ends up being an awful lot of them since they tend to serve a while. See also: Ben "helicopter" Bernanke; Paul Volcker.

And yeah, it's because they do tend to be similarly active, or at least very much in the public eye, when recessions hit.

Has the Federal Reserve always been this powerful and active?

yes, the fed intervened in the crash of 1987 too.

That's part of their mandates.

I completely agree with you. We used to sue companies and individuals for the crime of Market Manipulation. Now the Fed is in the business of Market Manipulation as a Service (MMaaS?).

> From my naive perspective, it seems like a lot of meddling, and it isn't clear if such frequent changes are required.

This is the result of fiat-based currencies and why Bitcoin is a necessity for the survival of Western civilization.

In the words of Max Keiser: "you can't taper a ponzi scheme."

Can’t tell if this is sarcasm or not. I mean, Max Keiser is quoted so I assume it has to be, but it still doesn’t read like it.

It's not sarcasm at all. It's a 100% correct, accurate, and serious statement.

The Federal Reserve was created to manipulate and control currency. The removal of the gold standard made it so that they could, to their heart's content, produce any amount of money and distribute to anyone they wished, whenever they wanted.

It is, in its entire conception, an absolute ponzi scheme. It is only in favor because that favor is enforced at the barrel of a gun via the tax system and the petrodollar scheme.

I don't see how it's a ponzi scheme. I understand your other parts but ponzi seems like an inappropriate term

The ponzi scheme attribution is due to the money printing and fractional reserve lending system. They can't pay off previous debts [1], so they print more money to try to inflate the debt away (which only leads to the creation of more debt, keeping the cycle perpetual). If they stop printing money/issuing new debt, the whole pyramid collapses.

[1] https://www.usdebtclock.org/

But this isn’t true.

Printing money debases the currency, it doesn’t increase borrowing. Not debasing the currency further is the reason all debt isn’t just printed away.

Bitcoin is entirely a ponzi, which is why I was surprised you cited it as an example of something better.

> Printing money debases the currency, it doesn’t increase borrowing.

It does both. Where do you think that printed money goes? The business model of banks is to lend out money. They go to the Fed to get more dollars and then lend those dollars out to other people. The more dollars available, the more demand for debt.

> Bitcoin is entirely a ponzi

You'd have to explain why because it's fundamentally not. There's nothing about it that requires coaxing others into it. You either want to use it or you don't.

I’m going to leave it here and wish you well. I could refute the above, but you’ll disagree, we’ll never see eye-to-eye, and we’d both just be arguing into the wind.

I (sincerely) hope it all works out for you and we’ll find out in time what it turns out to ultimately be.

> I could refute the above, but you’ll disagree, we’ll never see eye-to-eye, and we’d both just be arguing into the wind.

You're probably not wrong, but this is your dust up. Give me a shot, I'm open to well-reasoned arguments.

How does bitcoin solve this? Seems like gold should be used instead.

https://news.ycombinator.com/item?id=33586717

The US government confiscates gold when it wants to.

It also confiscates your freedom, passport and life if it wants to.

If we are fighting US government, I am not seeing the winning strategy here.

I agree. Western governments are doing just fine delegitimizing themselves as positive forces without our help. They'll either become more transparently honest brutal oligarchies, or they will collapse.

I'm good with either direction.

The inverted exponential distribution of BTC is far far far more unethical and harmful than anything the fed has ever done with respect to monetary policy.

You mean the 100% democratic halving algorithm which allows anyone to participate in the process of verifying transactions and earning Bitcoin?

> allows anyone to participate in the process of verifying transactions and earning Bitcoin?

Homeless people living under a bridge have the same ability to participate and get Bitcoin as SV tech bros running racks of ASIC miners in their three car garages?

Hypothetically, yes.

Hypothetically they could bevome a british lord through the right of conquest, and then sit in the house of lords.

So by your standards medieval Britania was a democracy too.

That's funny, but no. I could apply the standard of a homeless person buying a $300K McMansion in the same way and it'd be equally unachievable (of course you know that, but you're not concerned about being correct—you just want to look smart).

And yet you suggest a homeless person can reasonably assert influence on the Blockchain and mine it effectively. I'm generally not considered poor (not trying to flex) but there's practically no way I could mine anything of value or exert any amount of influence on the Blockchain. Much less any other random person out there.

Bitcoin is dominated by extremely wealthy miners. The only way it comes close to profitability mine is to get into big industrial power plans and buy tons of highly specified computing equipment. Only then are you breaking even (eventually, after the years of paying off the capex). But then you'll finally have a tiny billionth of the overall network speed and can make a tiny wave in choosing what transactions to include and push the chain any particular direction. It's practically democracy but you can pay $5 to vote again and can do it however many times you want, meanwhile lots of people pre-purchased votes at $0.50/ea and bought millions already. Sounds like a level playing field to me!

> And yet you suggest a homeless person can reasonably assert influence on the Blockchain and mine it effectively.

I never suggested anything even close to that.

> Bitcoin is dominated by extremely wealthy miners.

No, it recently had a drop in difficulty as the big box miners have had to shut down due to bankruptcy (making it more accessible to more people). That means it's both cheaper to get the equipment you need and easier to earn Bitcoin. What's great is that's by design.

> But then you'll finally have a tiny billionth of the overall network speed and can make a tiny wave in choosing what transactions to include and push the chain any particular direction. It's practically democracy but you can pay $5 to vote again and can do it however many times you want, meanwhile lots of people pre-purchased votes at $0.50/ea and bought millions already. Sounds like a level playing field to me!

This reads like you don't understand how Bitcoin works. I really don't know what you're referring to here. The network operates according to the current consensus around the protocol. If you want to influence the direction of said protocol, you can submit a proposal and if others want to support it, your changes can be implemented as an upgrade. There is zero prerequisite to spend anything to participate in Bitcoin. If you can offer a product or service to someone and are willing to be paid in Bitcoin, you just participated in Bitcoin. Just like every economy, the more you participate, the more opportunity you have.

You absolutely did when you said "yes" to the ability of a homeless person to exert as much influence and get bitcoin as a SV tech bro with racks of mining rigs in their garage. Its just a few comments ago.

> No, it recently had a drop in difficulty as the big box miners have had to shut down due to bankruptcy

A few miners shut down. The difficulty barely moved. Its still massively unprofitable for me to mine with any hardware I still own, and many friends of mine with ASICs can't profitably mine either. Leaving...those with extremely cheap energy sources (i.e., not residential rates, i.e., industrial plans, i.e., using lots of power total, i.e....big miners!) or those who have cheap generation sources they've already invested in. How much does a MW of solar panels cost again? How much land does that take up? Sounds easy for someone living under a bridge to put together.

So mining hardware has gotten a lot cheaper huh? Difficulty has dropped a lot? I guess I can mine on my Ryzen 5 2600 CPU then? No? Huh. Maybe my 1070 GPU? No? Huh. Clearly a $2k Macbook Pro M1. Still no? I wonder what a normal used miner goes for these days.

https://www.ebay.com/itm/334660278672 $2,255, 100Th.

https://www.ebay.com/itm/334660278672 $1,680, 100Th.

So easily $1,600-$2,255 for a noisy purpose-built box to mine. What's that gonna cost to operate? ~3kW of power usage, at $0.15/kWh, that's ~$10.80/day, assuming you're not spending any extra on cooling. What's my revenue for that 100Th of mining power these days? ~$6.60/day? Cool, so after spending somewhere around $2k on used mining hardware, I'll be generating -$4.20/day in profits when converting back to USD. Wait, that's a minus symbol... Wait, I'll have some losses from pool fees? Now I've got exchange fees as well?

Well at least I'll have generated some bitcoins. How many did I mine my first day? 0.00036715BTC? Over a year I'll have ~0.134, assuming the difficulty doesn't continue its few year history of continuing to go sky high. We'll say BTC is back to ~$20k, that means for that ~$2k capex investment and $3,942 in power costs (ignoring the fact I had to pay to have space to put the things and might have needed to cool them) I'll have generated ~$2,680.

Yeah, definitely seems like a normal thing average people are gonna be able to participate in. That guy living under the bridge is gonna be able to mine so many bitcoins.

> If you want to influence the direction of said protocol, you can submit a proposal

I can petition the lords for change. They can also just choose to ignore me. Some people wanted larger block sizes. Some wanted faster generation times. We've seen how those changes have turned out over and over. In the end, Bitcoin is what the miners want it to be.

> You absolutely did when you said "yes" to the ability of a homeless person to exert as much influence

No, I didn't. You said "have the same ability to participate and get Bitcoin" to which I said yes. You reworded what I said, disingenuously, to force an incredibly weak argument.

> Its still massively unprofitable for me to mine with any hardware I still own, and many friends of mine with ASICs can't profitably mine either.

Ah, there it is. It's not about other people, it's about you. Like I've already stated, if you want to participate in Bitcoin but mining is out of range, go offer services and/or products for Bitcoin and earn it (I've done it happily, and have paid others for their services using it, too). Nobody owes you Bitcoin.

> Yeah, definitely seems like a normal thing average people are gonna be able to participate in.

Do normal people participate in SWIFT? No. That's the level Bitcoin is operating on. But it doesn't exclude them from transacting in the currencies that rely on SWIFT as a network.

> I can petition the lords for change. They can also just choose to ignore me. Some people wanted larger block sizes. Some wanted faster generation times. We've seen how those changes have turned out over and over.

And they likely will with this attitude. And yes, their ideas didn't gain traction so they ended up forking, and lo and behold, it didn't work. Those experiments were failures. The system works.

> Like I've already stated, if you want to participate in Bitcoin but mining is out of range, go offer services and/or products for Bitcoin and earn it (I've done it happily, and have paid others for their services using it, too). Nobody owes you Bitcoin.

"If you want to vote in a nation where only landowners vote, go offer services and/or products and earn land."

Yes. Your opinion is irrelevant if you're not contributing to the whole in some way (no matter how small). It's beautiful and immediately removes the potential for parasites to thrive. That's why government/statists hate it so much. They can't just steal from people under false pretenses and have to actually provide value or something of merit (which they can't do, because they've invested their entire being into parasitism).

Bro, oligarchs would LOVE if land == vote.

You can literally buy votes with capital. What a ridiculous system (and extremely undemocratic, btw!)

Guess what? People who don't own land still contribute towards society.

It seems like you may have a lot of vested interest in BTC. If so, that is very clearly clouding your judgement on this issue.

I have friends who have lost a lot of money to various schemes, and they sounded just like you sound here when I tried to talk to them about it (from MLM to crypto yield scams to penny stock newsletters) - they lacked the capability to criticize it b/c they needed it to be true.

It's setting yourself up for a lot of pain.

@roflyear

> You can literally buy votes with capital.

That's Ethereum, not Bitcoin.

> It seems like you may have a lot of vested interest in BTC.

Not really. I'd like to see it succeed, though, as it can help a lot of people.

> I have friends who have lost a lot of money to various schemes, and they sounded just like you sound here when I tried to talk to them about it

I've lost no money on Bitcoin and I've been in it since ~2013 (I do a simple dollar cost averaging scheme to do a daily buy and when I can, accept it as payment for my services). I have a deep disdain for MLM schemes. I don't "need" it to be true, I'd like it to be true.

If people fail to "get it," I'm not going to have an existential crisis. At worst, it will just confirm my suspicion that the majority of the world's population lacks the intelligence to free themselves from tyranny (ironically, by design via state education) and are forever-destined to be enslaved. I'll still be in my backyard picking vegetables. Might even have a soda. Or I'll be in some dystopian prison singing Promised Land [1] by Elvis Presley and throwing my shit at the wall.

[1] https://www.youtube.com/watch?v=aXGXCXifcWg

> Your opinion is irrelevant if you're not contributing to the whole in some way (no matter how small).

"Fuck the poor."

I'm glad we got this far. "Oh it is democratic" to "yeah poor people are parasites who deserve to be crushed under my boot" in like six comments. Be honest and start there next time.

> "Fuck the poor."

You said that, not me.

> "yeah poor people are parasites who deserve to be crushed under my boot"

You said that, not me.

> Be honest and start there next time.

Take your own advice—you seem deeply disturbed.

>> "Fuck the poor." > You said that, not me.

The only effective way to "vote" in the Bitcoin world is to mine. The only way to mine is to be wealthy, as I've established here. The only way to be wealthy is to not be poor. Otherwise, you're just sending a letter to the lords to maybe adjust how the system works. Just being a vendor that accepts Bitcoin is the same as just taking USD and hoping the Federal Reserve moves in your interests. You're exerting the same controls overall. In the end, some outside group you have little to no control over has influence in the Monopoly bucks you're trading in. Just in one case, its the miners/exchanges (global markets for BTC). In the other, the Federal Reserve/US Government/the global market for dollars.

Otherwise, making a lemonade stand or making a facebook post is the same as the right to vote in the United States.

If I'm wrong about how providing services in BTC is different in terms of providing services in USD as an example of exerting democratic forces in the currency feel free to share. I'm definitely down for more examination in the topic, but from what I see so far it doesn't seem like Bitcoin is democratic or disconnected from large capital interests than USD in the end.

At least with USD there's some loosely disconnected system from the people I vote for to the people actually appointed to the levers, in BTC its just the people who managed to buy the good mining hardware a few years ago or who manages to find a more efficient way to compute SHA hashes next year.

100% democratic? Satoshi didn't ask me when he chose the halving algorithm. Do you mean democratic in the sense that the miners get votes according to their hash rate and they could tell the core devs to get bent if enough of them got together?

That's not democracy.

"All landowners get a vote according to the amount of land they own. Work for scraps you peasant."

Unethical nonsense.

> Unethical nonsense.

You can propose changes to the network at any time via a BIP (Bitcoin Improvement Proposal) [1], so sorry, but you're just wrong. Bitcoin is the most ethical form of money that has ever existed.

> "All landowners get a vote according to the amount of land they own. Work for scraps you peasant."

This is an impressive contortion of reality, but nonetheless completely wrong. Your "voting" ability has nothing to do with participation in mining. Your vote is participation in the network, open ability to submit proposals, run a node to bolster the network, and if you wish, run a mining rig to validate blocks and earn Bitcoin. You can also earn Bitcoin from others directly providing products and services.

[1] https://github.com/bitcoin/bips

But I have no vote in its adoption. "Anybody can propose a change" is not democracy. Not even remotely close. I am frankly horrified that somebody could conclude that this is a just system under which to operate money.

It’s better than democracy. Anyone can influence the direction of the network. The best ideas win (if you want to be pedantic call it a meritocracy). The status quo is a bunch of bankers, behind closed doors, determining your fate. I’m frankly horrified that you think that’s a just system.

You previously used the phrase "100% democratic halving algorithm." If you want to argue that the system is better than democratic control over our financial systems then that's a completely different discussion.

I don't agree that "the best ideas win." I certainly don't agree that the halving system is a "best idea." It massively and almost permanently privileges early adopters, creating a landed gentry of the modern world in a completely unjust. The ideas most valued by a particular set of people (either the core devs or the miners, depending on how you define BTC) are what wins. That's aristocracy.

Well then I guess you're screwed.

"Screw those other people" is not my idea of a just system.

I'm glad you got rich as shit off BTC. That doesn't make you a good person.

It was a joke and I didn't "get rich as shit."

You would do well not to judge people so much; it's unbecoming and makes your entire point of view effortless to dismiss.

Your solution to the Fed controlling interest rates is a currency (or currency substitute, perhaps) that lost half its value in the past year or so? You may be sincere, but I don't think your judgment is very sound.

Lost half of its value relative to what currency? 1 Bitcoin still equals 1 Bitcoin.

Sure, but that's true of everything. The dollar is still worth one dollar, too. But we still say that the dollar is losing value to inflation, and we experience it every time we try to buy something else with dollars. (Buying dollars with dollars is rather pointless.) And I'm pretty sure you know all that, and the parent post was just an attempt at a deflection.

Bitcoin has lost half its value compared to every other currency in the world. You know, those no-good-easy-to-inflate fiat currencies. Compared to gold, too, if that floats your boat. Compared to a basket of goods, which is how inflation is measured for everything else.

So, yeah. Compared to everything except itself, it's lost half its value in the past year. That doesn't make me feel like "Bitcoin is a necessity for the survival of Western civilization" is a very objective look at the reality of the situation.

> Sure, but that's true of everything. The dollar is still worth one dollar, too.

It's not. [1]

> But we still say that the dollar is losing value to inflation, and we experience it every time we try to buy something else with dollars. (Buying dollars with dollars is rather pointless.) And I'm pretty sure you know all that, and the parent post was just an attempt at a deflection.

No, the dollar loses value to inflation because the supply of money continues to increase, therefore making an individual dollar less valuable (value of currency is drive by scarcity). The supply of Bitcoin is fixed, and therefore, anti-inflationary.

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The price in X currency is whatever that market is willing to pay for Bitcoin, but that doesn't change the value of it. It's identical to the stock market. The stock market price of a company is not the book value of a company. Ironically, the money printing is what creates and worsens that disconnect as companies do stock buy backs with printed, un-backed dollars, artificially increasing their stock price.

[1] See "Buying Power of $1 over time, 1800-2022" here: https://www.officialdata.org/us/inflation/1800?amount=1

The value of a dollar, as measured in dollars, has not changed. The buying power has. This is exactly the same as Bitcoin, which is why your "1 Bitcoin is still worth 1 Bitcoin" line is meaningless. We don't care about the value of anything as measured by itself. We only care about the value as measured by other things - that is, the purchasing power. Well, the purchasing power of Bitcoin tanked over the last year.

(We don't care about the absolute number of the thing, either, so your "supply of dollars is increasing" argument is also irrelevant. Though I will give you that the increase in the supply of dollars faster than the supply of things for dollars to buy causes inflation.)

> We only care about the value as measured by other things - that is, the purchasing power.

You just contradicted yourself, then.

> Well, the purchasing power of Bitcoin tanked over the last year.

It didn't. The purchasing power relative to other currencies did. If your goal is to just use Bitcoin as a way to make more dollars, then sure, you lost something. If your goal (like my own) is to store your wealth in a way that can't be manipulated or confiscated, then you didn't lose any purchasing power.

It's an abstract argument and I understand exactly the point you're making, but ultimately, Bitcoin's inherent value is unchanged (1 Bitcoin = 100,000,000 Satoshi).

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