[ceejayoz]

> 98% of countries in the last 120 years that had a debt to gdp of 130% has either defaulted or had massive inflation

Sounds impressive, but this stat relies heavily on a) developed world nations and b) nations back when we had the inflexible gold standard. The US also benefits dramatically from being able to issue debt in USD, which it controls.

[wustangdan]

Yes exactly, on gold standard they would default, now they inflate.

The US can issue debt in USD and even print 1 trillion USD coins. But what happens to the value of the currency when they repeatedly do that?

Crypto (and other assets obviously) can act as a hedge against such bad government behavior.

[ceejayoz]

> The US can issue debt in USD and even print 1 trillion USD coins. But what happens to the value of the currency when they repeatedly do that?

Thus far, not all that much of consequence.

> Crypto (and other assets obviously) can act as a hedge against such bad government behavior.

Objection, Your Honor. Assumes facts not in evidence.

[wustangdan]

https://www.bls.gov/data/inflation_calculator.htm

From Jan 2019 to now we've had 17.4% inflation. Your purchasing power of the money in your bank account has been reduced. How have other assets faired in that time?

> Objection, Your Honor. Assumes facts not in evidence.

Okay longer timeline, if you held dollars in your savings account from Jan 2009 to now (during ZIRP) you've lost 30.5% of your purchasing power. How has the SP500 or houses fared in that time (even ignoring crypto)?

If losing 30% of your purchasing power is no consequence to you, please let me have a not much of consequence portion of your salary, thanks.

[ceejayoz]

> if you held dollars in your savings account from Jan 2009 to now...

... I would be a doofus. That's where my emergency fund goes, but that's it.

> From Jan 2019 to now we've had 17.4% inflation. Your purchasing power of the money in your bank account has been reduced. How have other assets faired in that time?

My home value has tripled, and the S&P500 has gone dramatically up. Series I savings bonds are also a useful option if I'm really all that worried about the stuff in savings, as their interest rate is pegged to inflation numbers.

If we're going to carefully pick dates to make our arguments ("Jan 2019 to now" having had some... outlier stuff going on, after all) I'm gonna ask how hedging with crypto starting in April or October of 2021 would've gone. Remind me the purchasing power of a $64k Bitcoin today?

[wustangdan]

Well sorry but you confused me as my main issue was with USD and I believed you thought that USD had "not all that much of consequence" happening to its value. But it seems we are mostly in agreement.

I'm happy you have a home and own some SP500 to offset USD destruction. Not everyone is so fortunate to have access to those markets. I would suggest you look into crypto as part of your hedge against bad USG behavior because it has some nice properties that could uncorrelate it with those assets if things get nasty (90% tax rates, etc).

[JumpCrisscross]

> if you held dollars in your savings account from Jan 2009 to now (during ZIRP) you've lost 30.5% of your purchasing power

One, obviously a policy failure. Two, don’t do this. Bank deposit dollars are optimised for transacting, not long-term value transport. For that, use Treasuries (including inflation-protected ones). It’s not the Falcon 9’s fault that it makes for a bad hammer.

[wustangdan]

Well I mean the recent bank failures showed the issue with treasuries, but sure it seems we agree more than disagree. You agree that holding USD is failure for long term value or even short term (3 year) value transport.

My argument is that assets and crypto is needed to hedge the potential incoming USD destruction. And that because crypto has some nice properties that houses and the SP500 don't, it has a legitimate reason to be a part (even if small) of your hedge.

I don't buy the "Crypto is a complete scam" argument at all.

[JumpCrisscross]

> I mean the recent bank failures showed the issue with treasuries

No depositors lost money. And like, yeah, Treasuries go up and down in price; it's dumb our regulations pretended otherwise. Particularly given the problem was fixed by Basel III.

> assets and crypto is needed to hedge the potential incoming USD destruction

This is gold buggery. Which means gold does a fine enough job.

> don't buy the "Crypto is a complete scam" argument at all

I don't, at least not with certainty. But there is certainty around the prevalence of fraud. That needs to be regulated, which means crypto needs to be taxed to pay for that regulation. Gold bugs are a famously-profitable client group for finance; crypto is the same. Let's put them on the same level.

[this_user]

And how has that alleged inflation hedge performed last year when inflation was at its highest? It went down about 80% YoY. Crypto is not a hedge against inflation. It's not a currency, and it barely works as a shitty payment system. It truly is one of the worst technologies ever invented, and nothing would be lost if it just ceased to exist.