“You mean to tell me that the IRS is a gold sink?!”
“Well, actually that’s a pretty good analogy, the difference is… well… that’s a pretty good analogy!”
That said, video game economics are pretty fascinating. I love reading writeups on Eve Online economics. I play FFXIV myself which isn't as good as Eve when it comes to economy, but interesting in its own rights. I wish it had buy orders and the ability to buy individual items instead of whole stacks, lol.
[1] https://www.investopedia.com/modern-monetary-theory-mmt-4588...
How a group of people can be wrong every time about everything in stated ambition while acting in ways completely consistent with Randian Objectivist Naziism in practical terms, and not be hounded out of public life bewilders me. There is probably no moment as simultaneously classist and misogynistic and stupid as when Brinksley Born got knee-capped for being right about everything by Summers, Greenspan, and Ruben with the Ghost of Future Reich (Ayn Rand) looming ominously in the background.
The people running the show around here, the “effective altruism” crowd like SBF and Altman and shit? They still put Atlas Shrugged icons in their Mastodon chats long after everyone without an agenda realized they’re the new version of old fascism.
A modern economy works by running a printing press a little faster than a furnace, with the coefficient being (under honest and competent management) a good estimate of next year being better than this year by such and such, a self-fulfilling prophecy in a good way until you like, burn the planet via carbon emissions or some hard constraint like that.
And it’s a perfectly good system… under honest and competent management. It’s just easier to corrupt than systems with much lower potential (which is the distance between gold bug and ignorant, those folks have a point, they just rarely make it).
This is where all the 1971 stuff comes in: no rich person does anything but advantage their less-capable kid or lover or whatever unless someone is pointing a gun at them. (e.g. Altman has a job let alone unfettered power). The gold standard has a lower maximum potential risk to the extent you can stop there being a de Beers of gold. You likewise accept 50 years from the transistor to a computer in your house even if you’re fucking loaded.
The unanswered question is: can we get competent and honest leadership (after a fashion) back without the bloodshed it has required 100% of the time before?
A lot of us hope so but don’t have an answer just yet, and the clock is ticking.
If you have particular questions about the monetary system, I know enough to either answer or know that I don’t know and refer you to someone who does.
There were four fairly direct questions in the post you replied to, to which you might like to give a response:
>> [what do you] mean [by] the "printing press to furnace" analogy of the economy
>> what you mean by 1971
>> or the gold bug
>> or the 50 year transistor
The first of those I'm pretty sure I understand what you are meaning, though if I'm right about that I don't think it is a good analogy, but the others I have no context for.
By “printing press” I mean the set of mechanisms in which fractional reserve deficit spending creates the money supply to notionally value future growth, and by “furnace” I mean the set of mechanisms by which we prevent arbitrary inflation as a result. You can measure the money supply in plenty of ways, but for someone who needs a glossary on my original comment, TLDR you want a number called “M2”.
A “gold bug” is someone who either does or advocates the strategy of holding “precious” metals as a uniquely good asset class (no one turns down a free pile of gold, many of us think the market is pricing gold as well as we are), in particular an asset class uniquely resistant to inflation and/or the “government”. I can assure you from painful experience that “the government” gives no fucks if you have gold in your back yard when they make a clerical error.
50 years is roughly the period of time it took for at least two separate inventions of “the transistor” by a bunch of Bell Labs people, but overwhelmingly associated to a guy called Shockley, to culminate in a useful computer that a middle class person could afford to have in their living room. I learned to code on an IBM PC my distinctly middle-class grandfather owned, and it is a substantially better computer than no computer, a harder claim to make about the Apple I for example.
Very roughly modern economies work by printing money in the form of government treasuries (government borrows $ to run the country) and destroys money by charging taxes (taxes go to IRS and are used to pay off the outstanding treasuries)
I think you are confusing Modern Monetary Theory with modern economics. What you are describing is MMT, not what actually happens (the government collects taxes then spends that money + prints more money)
You sir, like many, imply an academic knowledge of markets that would be tradable. If you know what’s wrong with my comment there’s serious money in it, and no one can buy the education you’re implying because the price would be the arb value of all the misprinted securities, trillions easily.
I’m asserting that actual guys called names like Cavendish, who get the actual spread by virtue of being in jobs where you need a name like that laugh in their beer, I’ve been there and I’ve seen it.
“You’ve never dealt with Harkonnens, I have, they’re not human they’re BRUTAL”.
You’re free to disagree, and free to do so under a pseudonym. But if you know anything I don’t about markets generally and US sovereign debt markets in particular I don’t: fuck this HN shit and go trade it. You’ll own HN by the close of business tomorrow, and I will be the least of your worries.
I hope we don't start dropping bombs on our own cities....
I thought that was the only explanation for their prices.
The gold in online games is fabbed the same way.
The only two reasons that makes it hold value is that is the only sanctioned way to exchange goods and services and the players trust it. Once one of the two reasons does not exist, gold will not have any value, just like money in real life.
Sloppy, leaky Venn diagrams are a fact of real life.
Let’s try to avoid “Jews vote for Likud” or “nine eleven was an inside job” type oversimplification?
It’s complicated but for a good set of reasons.
To address the particular point that he was replying to: the government (especially the US government) has only one money problem: does anyone lend them money (buy their bonds) when they’re picky about terms (floor on auction optionally) at an acceptable overall outcome (you still believe I can invade your country if you fuck around on USD).
So it’s simpler and faster and the math is easier to just burn all the checks the IRS gets and make new ones at the Fed.
Which is the same solution as all the games landed on.
To me at least, this sounds like a hard job in Athens with the Bundesbank pardon the ECB breathing down your neck, and a trivially easy job in Washington DC where you can physically destroy anyone who disagrees with your assertions about the value of anything.
Unfortunately the actual job has become: “maximize class solidarity at any cost up to and including arbitrary bloodshed”.
Inflation wipes out the notional value of debts and therefore favors the 80-90% of people whose finances are dominated by a debt term. At the low end of being lucky that debt term is unsecured dollar-valued debt like a credit card. At the high end misguided boomers acting against their own interest owe that debt as a 30 fixed secured by a home.
The subset of boomers (or wannabe YC insiders) who suffer at the hands of inflation are fucking vocal but statistically irrelevant. The ratio of actual financialization of actual asset classes to people who whinge about “inflation” is maybe the stupidest thing said stupidly constantly.