[bradwood]

> Eh, that's pretty obviously untrue under any reasonable definition of "competent Federal Reserve"

It's not obvious. Is any central bank that debases currency through money printing without some kind of fixed peg/ratio to a scarce asset competent?

No. This is self-evidently true as, by doing so, they are perniciously taxing the savings of the poor in order to feather the nests of the (asset-)rich.

There is no avoiding the truth of this inviolable fact as Cantillion himself described many years ago.

[tablespoon]

> Is any central bank that debases currency through money printing without some kind of fixed peg/ratio to a scarce asset competent?

You're...

>> monomanically overoptimizing to one metric

As long as they do the debasing competently, as in the currency is able to sustain a healthy economy, then they're a competent central bank.

Bitcoin could never sustain a healthy economy, for instance, because it strongly promotes hoarding and speculation.

[bradwood]

> As long as they do the debasing competently...

This is a contradiction in terms...

Bitcoin promotes hoarding no more than gold does. And speculation no more than FX or commodities trading does.

If a payment currency was pegged to bitcoin and the backing ratio remained fixed things would be fine like they were when we had the gold standard or even the later USD reserve currency standard when the USD was backed by gold.

However history had shown that these arrangements did not hold as central bankers simply couldn't resist firing up the printer and breaking the peg with the scarce backing asset. Political pressures, wars, whatever the reason. Every peg was broken.

Human greed, misplaced albeit well-intentioned mistakes, and simple human fallibility will continue to tempt even the most honourable people close to the money spigot. It's happened throughout the ages and human nature will not change in this regard.

Bitcoin _algorithmically_ prevents this debasement and so it is literally the perfect base monetary asset. No one can fuck with it.

[tablespoon]

>> As long as they do the debasing competently...

> This is a contradiction in terms...

No it isn't. For instance, I can see carefully controlled debasing (e.g. inflation) as motivation to put money some use rather than sit on it, for instance.

> Bitcoin promotes hoarding no more than gold does. And speculation no more than FX or commodities trading does.

Maybe gold promotes hoarding too much, as well. When you get down to it, it's also questionable to tie your money supply to the availability of some arbitrarily-chosen commodity. Do you want deflation until someone discovers some big gold deposit, then things swing inflationary? Bitcoin seems even worse since it's designed to be deflationary, since people will irretrievably loose them and at some point no more will be made.