[georgecarlin]

No. "stocks/bonds/land/etc" are not actual assets backed by anything OTHER than scarcity. Land has value due to scarcity and utility (everyone needs somewhere to live). Stocks have value almost exclusively due to capital appreciation. You don't get anything for owning non-dividend-paying stocks. And owning dividend paying stocks just means money is not being reinvested (notice that Berkshire Hathaway has never paid dividends out).

Bitcoin is EXACTLY like land and stocks, except much, much, much more liquid and useful.

[pedrocr]

>No.

Starting replies like this is getting to be a theme online. It adds nothing to the discussion except make people argue in extreme and entrenched ways.

>"stocks/bonds/land/etc" are not actual assets backed by anything OTHER than scarcity.

I specifically said they were backed by scarcity (land) and by economic activity (stocks and bonds).

>Stocks have value almost exclusively due to capital appreciation. You don't get anything for owning non-dividend-paying stocks. And owning dividend paying stocks just means money is not being reinvested (notice that Berkshire Hathaway has never paid dividends out).

I have no idea what you're trying to say. Stocks generate value out of an economic activity. That's the value that underlies them. If the company then has enough opportunities to continuously reinvest or if it just gives up and returns value through share buybacks or dividends is not really important to the point that what makes stocks valuable is that the company has some form of economic activity. If you find a stock that doesn't have an underlying economic activity and is just driving up price through scarcity that's not a company it's a Ponzi scheme like Enron used to run.

>Bitcoin is EXACTLY like land and stocks, except much, much, much more liquid and useful.

Bitcoin is digital gold. Useful yes, but wow, you really think its value dwarfs the asset classes responsible for representing the available physical area of the planet and the current economic activity of the planet?

[walrus1066]

At least gold has some practical uses (i.e. In electronics). So if people gave up on the idea of holding gold for the sake of holding gold, it would still have some residual value.

Bitcoin, however, seems to have no practical uses whatsoever.

[georgecarlin]

This doesn't make sense. You don't get anything for the company performing economic activity. The price of a (non-dividend-paying) stock is set strictly by supply and demand. You only get anything when you sell.. i.e. when someone is willing to pay you more than what you paid for your share.

[pedrocr]

>The price of a (non-dividend-paying) stock is set strictly by supply and demand.

I don't understand what you're arguing against. First there are plenty of stocks that do return dividends (or do stock buybacks which are equivalent). Second, pricing may be suboptimal, maybe non-dividend stocks should be worth less[1] but it's still pricing something. Bitcoin is just pricing digital gold.

You're also going into the pattern of taking a comment and very vehemently discussing a small part of it as if that's what's being discussed. The initial OP assertion was that somehow fiat currencies are "printing wealth" as if printing dollars is somehow printing wealth, it's not. You've then made an even more incredible assertion that Bitcoin is strictly better than land or stocks because it's more "liquid and useful". Care to explain that? Certainly you're not arguing that Bitcoin is more valuable than all the world's stocks/bonds and all the world's land? And certainly you don't think something that struggles to do enough transactions a day to sustain the current network is actually currently more liquid or useful to the world economy than the capital markets that handle several orders of magnitude more transactions and total value?

[1] Almost certainly not 0 but that's a totally different discussion not worth going into here.

[georgecarlin]

I agree printing money != printing wealth, in fact it has the exact opposite effect, it debases wealth. My argument is against the fallacy that since bitcoin's price is set by unregulated supply and demand, it has no value or is somehow less valuable than land or stocks, or is somehow intrinsically value-less. Bitcoin can be seen as the most credible implementation of pure Austrian price theory (notwithstanding some likely pumps at different exchanges etc).

Stock buybacks actually demonstrate my point. You only benefit from a buyback if they pay you more than what you paid for the share. Dividends are a separate issue as they apply to business being undertaken, and few people invest money based solely on dividend rate. IMO land as a speculative asset actually might the most appropriate comparison to Bitcoin.

At any rate, Bitcoin/Ethereum and others are fundamentally new asset classes, they are technologized money. They allow you to do things with value that were never possible before.

[pedrocr]

The OP claimed wealth was being printed. Bitcoin didn't exist a few years ago and by your definition it constitutes wealth. So the closest we've had to "printing wealth" is Bitcoin itself. I suggest you study quite a bit more finance before you become so enamored by all this. Stock buybacks and dividends are fully equivalent for example, the only real difference is how they're taxed.

> At any rate, Bitcoin/Ethereum and others are fundamentally new asset classes, they are technologized money. They allow you to do things with value that were never possible before.

This is too breathless to be meaningful. Care to name a few actual uses? There's a long way still for cryptocurrencies to demonstrate they actually bring anything of value to the table. From what I've seen so far Bitcoin may be a slight improvement on gold (an asset that's mostly useless these days) and Ethereum may be a slight improvement on complex financial instruments (things that are often actively harmful). I may be completely wrong of course, time will tell.

Most people that evangelize cryptocurrencies would probably be a lot better served by reading up on the basics of investing and start accumulating traditional baskets of assets. There's a long way to go before cryptocurrencies are validated as actually useful and a lot of risk along the way.

[vasilipupkin]

I am not against bitcoin but bitcoin is not like stocks and land. stocks in aggregate pay dividends, sometimes in the form of stock buybacks, something that Berkshire does do. Non-dividend paying stocks are priced today due to expected future dividends. In other words, they may not pay dividends now, but they generate expected future profits. Land is physically scarce. Bitcoin is software, so scarcity of software is not the same as physical scarcity.