The Financial Times Cartoon "The Crypt" Adds Another Crypto Firm To The Bonfire

https://archive.ph/kdAGk

This could be crypto currencies’ Trough of Disillusionment…

The Captain

1 Like

I don’t understand the “Plateau of Productivity” in this particular case. What exactly will cryptocurrency produce?

3 Likes

Great observation!

What exactly will cryptocurrency produce?

Bankruptcies?

The Captain

IMO, the primary output of crypto is education… but not in the way you might think.

Crypto is basically backed by nothing… the US dollar is backed by nothing PLUS… um… the government will give you a dollar bill if you give them a dollar bill. The education part of crypto is that… potentially… it could reduce confidence in fiat money as people consider what the USD is backed by.

JMO of course. BUT… my opinion is backed by the same stuff as crypto and the dollar… :wink:

Rob
He is no fool who gives what he cannot keep to gain what he cannot lose.

Not quite, the fact that it is legal tender gives it value, artificial value but still value.

The Captain

Are you saying that the backing of the US Government is worthless?

Cryptocurrency is backed by nothing but reasons, and some of those reasons are in conflict. Fiat currency is backed by religion (even in atheist Marxist totalitarian states!), and religion emphasizes old time faith over reason until Venezuela or Zimbabwe or Germany mocks faith by stretching too far.

What more can I say?

I sure as hell never invested nor trusted crypto magic.

david fb

ptheland, you took my quote and then ask a question that the quote answers?

If you’re actually interested in doing some flag waving though… I’m not interested in entertaining you.

Rob
He is no fool who gives what he cannot keep to gain what he cannot lose.

I’m not interested in entertainment or flag waving. I wanted to be perfectly clear on what you were saying before I respond.

Your claim that the dollar has the same backing as typical cryptocurrencies is plain hogwash.

Cryptos are backed by nothing. Nada. Zilch.

While you might think that the “full faith and credit” of the US government is worthless, the vast majority of the world disagrees with you. The US dollar has been the most desired currency in the world for an very long time. It has become the world’s reserve currency because much of the world trusts the US to govern itself and its finances well. (There’s also a fair bit of history coming from being on the winning side of two world wars, which certainly helped get to that status.)

Don’t down play this fact. What you describe here is lending and repayment. If you lend a dollar to the US government, they pay it back to you. With interest. Since the beginning of the 20th century, we have never failed to repay our debts. (There were two occasions that should be described as defaults. In the 1930s, we repaid the debt in dollars rather than the gold which was agreed to in the bond issuance. And in 1979, we paid some debts late - partly because of bad planning in an office move and partly because Congress didn’t increase the debt ceiling in a timely manner. But in both cases, the debts were, in fact, repaid.) There are plenty of governments around the world who have failed to give you your money back if you lend some to them. The US is not one of those. We have protected our credit rating around the world and it is among the best in the world.

Because we take our promise to repay our debts seriously, we continue to have the ability to borrow money at preferential interest rates.

So yes, being backed by the “full faith and credit” of the US government is something very valuable. It is the same for many other government backed debts around the world. The Pound is valuable because the UK repays their debts. The Euro is valuable because the countries of the EU repay their debts. Ditto for Australia and Canada and Japan and numerous other countries. Those currencies are valuable because their citizens, acting through their government, takes the repayment of debt seriously.

Take a look at the tagline you choose to include on every post. Yes, I know its Christian meaning quite well. But it has application in the temporal world as well. “Give what you cannot keep to gain what you cannot lose” can be flipped and looked at from the other side. Do not give away what you can keep to gain something that will be lost. We should not give away or denigrate our credit rating just to gain some political points with some group or other. Those political favors or points or digs are ethereal. They exist for only a moment or two and then they are gone. But once our credit rating is lost, it will be close to impossible to restore. Certainly not in our lifetimes.

Your comment that the backing of the US government is worthless is a denigration of 12 decades of hard work by our parents, grandparents, and great grandparents to get this country where it is today. They made our currency the standard for the world. Your careless words would make a mockery of that work, trashing our reputation for nothing more than a fleeting dig at the opposition or the click of a like button.

–Peter

“Your comment that the backing of the US government is worthless is a denigration of 12 decades of hard work by our parents, grandparents, and great grandparents to get this country where it is today. They made our currency the standard for the world. Your careless words would make a mockery of that work, trashing our reputation for nothing more than a fleeting dig at the opposition or the click of a like button.” – Peter

Good for you. Have a parade.

We still have a fiat currency backed by nothing… “tangible”… hope that addition makes you feel better. :slight_smile: Keep in mind I have had no intent of riling up anybody. Sorry you’re offended by my opinion.

Rob
He is no fool who gives what he cannot keep to gain what he cannot lose.