Assuming the title to be accurate, what is a good way for the working class (90%+ of all humans) to save and succeed in this current environment?
Fiat can work fine on a finite planet, most money doesn’t even take up physical space anymore, just bits in an account ledger database. Ideally in the future governments will make sure their currency is backed or based on labor time, and nothing is technologically preventing that, nor is crypto-currency required for it.
The issue here is according to the Fed, the stakeholders get a 6% return, which is supposed to outpace inflation. So if the ones closest to the money printer get more every year, while the rest lose money due to inflation eating it, it doesn’t matter if it could theoretically work, it leads to an accumulation to the class system at the top while the lower classes must continually work forever since their savings are worth less every year
Gold and silver.
Just store infinite money tokens in a magic Orb. Lol. That’s quite easy
As an aside, I’ve often wondered what would happen if everything was automatically adjusted for inflation.
So like cost of living inflates, but then income is adjusted and bank accounts are modified to be their true value before inflation.
Would this patch things up to be effectively 0 inflation? or (more likely) would this cause an absurd runaway effect?
The issue here is we actually don’t know how much inflation there is because we can’t measure the quantity of fiat, which is why there are dozens of “inflation measures” which just study different baskets
But yeah, if inflation could be measured correctly and everything automatically updated (wages, costs, etc) then I’m not seeing an issue logically. But at that point it’s just a fixed supply of money and prices adjust up and down, irregardless of currency type. That sound reasonable?
That it would spiral into more inflation, making your money worthless. Which is exactly what happened in Italy with the Lira
Has crypto failed?
Yes
But also no.
yeah, it succeeded in scamming a lot of people for their money
BTC 130% up last 365 days. 10% up last 30 days
But seriously if everybody would use crypto, the up and downs wouldn’t matter. The value/pourcentage is only VS Fiat.
Newsflash: currencies shouldn’t wildly fluctuate in value. The fact that people use it like a stock market investment, (and an idiotic one at that, since there is no underlying business), is exactly why it has failed to be a currency.
It fluctuate vs the Fiat value, not with itsleft. The supply of BTC is determined, not like the printing machines we got now.
Nothing’s value fluctuates with itself. Money supply is controlled through interest rates in modern economies because it works better than directly controlling the money supply. Your comment betrays an unsurprising lack of understanding of the most basic concepts of economics. You’re just parroting some talking points you’ve heard from techbros.
No, you think economics is a physical science and it isnt. It works like it does bc its been made to work that way. It could work differently.
Also Bitcoin isn’t the only way cryptocurrency could or does work.
What does the term “wildly fluctuate” mean? In 50 years of USD fiat, gold vs USD has gone from 35$ to ~2000$ per ounce. That seems pretty rapid to me, since I can still talk to living people who experienced it
At least BTC has historically gone up, whereas fiat goes down, although only a few years of data for crypto compared to thousands of fiat, so maybe crypto will do the same as well
what is a good way for the working class (90%+ of all humans) to save
Gonna sound like a dangerous lemmy communist, but vote for parties who want to raise wages and join Union to defend your rights. The main problem is that most working class struggle to finish the month without a negative bank account, once it’s solved, saving become possible again
You sound like a decent social-democrat to me
But if their savings is in fiat, and its stated goal is loose value 2-3% annually, then the working class could never retire unless they make every economic investment choice correctly their entire life to have beaten inflation
Which isn’t always plausible to do in a country lacking social safety net, public healthcare, etc.
Yeah, hence why I’m looking for ideas
The title isn’t accurate, so I can’t assume it is.
Fiat currency works precisely because the planet is finite. What you’re thinking of is a currency that’s tied to a finite resource, like a gold standard. Fiat currency works precisely because monetary supply is able to be increased to keep pace with both the population and economic growth. Likewise, fiat currency can be removed from the economy when the economy shrinks (although this hasn’t happened before).
Gold isn’t finite, its supply increases every year and is the main reason for the stability in prices. Obviously this can’t continue forever, hence the finite resources on the planet
Two things you’re assuming is fiat can be evenly distributed with population growth and at some point the issuing body will reduce excess supply, neither of these things are common practices and rarely happen
Gold is the definition of finite. There is only so much gold in the world–by which I mean the 3rd planet revolving around the sun in the solar system that we both reside in–and the only way to make more gold actually makes radioactive gold. THe fact that we haven’t discovered every last atom of it doesn’t make it any less finite.
Sure, theoretically it’s “finite”, but we do discover more every year, so to us, in 2024, it is not finite. Different infinities exist, yes
Different infinities of a particular finite resource do not exist though. Yes, we discover more every year, but that does not make it an infinite resource. If a country was dumb enough to link their monetary supply to a resource, and then their economic growth outstripped their domestic production of that resource, they would experience deflation, id est, the money you have now would be worth more tomorrow than it is today. Periods of deflation, while rare, always have a catastrophic effect on economies, because no one wants to spend money when the value of that money is increasing. People tend to hoard their money when that happens, which rapidly leads to recession and then depression.
So other than some good or a country’s clout, what do you suggest is a better alternative for a store of value?
Your core premise is, again, flawed. You want a good way of storing ‘value’–which is a nebulous concept to start with–and then condition that premise on not using a fiat currency. Fiat currency is the best way of storing that value, and using that value at some point in the future. You could invest in stocks, bonds, money market accounts, or real estate, but that’s all still based on a fiat currency of some kine.
Value is vague on purpose, since it means that something retains its “essence” tomorrow as good or better than today. Otherwise humans would not even be able to feed themselves since the only reason I can have food in the winter is because I have something to exchange for food from places that have figured out to grow or store food. It also would be a terrible place if we worked very hard today and our returns depreciated rapidly, because there will be times when we can’t work
Sure, stocks and bonds have historically held some value, but is near impossible to out perform base inflation and has gotten worse the last 20+ years. Physical land and tangible long term goods have held up, but difficult to use for trade, hence currency
So you’re just very pro fiat?
I’m too lazy for this just read Superimperialism
Good advice, thank you for sharing
it’s a really good book also the author’s podcasts with radhika desai begin with a good primer on it
What do you mean fiat doesn’t work on a finite planet? Current economic models certainly don’t work on a finite planet, but fiat was here before them and will be here after they are long gone.
what is a good way for the working class (90%+ of all humans) to save and succeed in this current environment?
There isn’t one. A big chunk of that class can do just fine and you probably already have good normative answers in that respect, but the current economic model is one that demands poverty. Even with all of the ridiculous developments in production we have, the available infrastructure even with the qualms we might have with it, and all the other things going for us that you might want to list, the closest that the current economic model has achieved to escaping its age-old need for having a sizeable portion of the able-bodied population unemployed is by slightly expanding that same portion and then having them sell themselves by the hour and minute in the Gig Economy. If you want that whole 90% of the population to all be able to do well, you need to change the system they are operating within.
Eat the rich
Stockpile canned beans they will become the most valuable currency once the WW3 starts.
#NotAFinancialAdvice
Also, toilet paper?
Social revolution is the best retirement plan.
Fiat doesn’t work on a finite planet.
Citations needed.
I’m unsure of what a finite planet is referencing? Is op suggesting that economic limits are constrained to finite resources? This doesn’t take into account renewables, human creativity and a whole list of other things. If we create a matrix like environment where the limits can be expanded and create new products in that new environment we can still use fiat.
I don’t know why they’re conflating infinite money with finite resources. The two have no relationship to each other.
I think we need more restrictions on finances, so our human creativity can effect. What I see is that most advanced civilizations’ largest export is literal trash due to excess and waste, so I figured why not have a discussion about it
Also, every fiat currency has failed in the two ways it can: hyperinflation or clout loss due to no trust in the issuing party (which tends to lead to hyperinflation). Innovation has stalled or at least hit the top of the S curve over the last 50 years, with mostly remixes of old ideas that tend to expedite the finite resources we have, so I don’t think technology will outpace inflation
Technically, Planet Earth is huge for us because we cannot use it efficiently or in a reasonable time, and we don’t even have to talk about the sun.
Finding pockets of self sufficiency, or at least ways to prevent falling down to the bottom.
Universal basic income helps this by making sure everyone has at least enough to live on.
Homesteading and community gardens help this by making sure you at least have some basic amount of food available to you.
Building walkable cities helps.this by allowing you to avoid or reduce the expenses of a car.
Building resilient cities that leverage adaptive reuse help this by making it cheaper to start new small community businesses that keep money local.
The solutions aren’t in the system of money we choose, it’s in building small sustainable ways to provide for basic needs, even in a small way.
