this at least has real links to tangible asset worth,
Well, kind of. But the worth of those assets is largely due to perception, rather than real utility value. Like, real estate is stupidly expensive in many places, but it’s expensive because people believe that it’s expensive. When real estate bubble burst, you see the ‘worth’ of that real estate drop sharply. The utility value is having a place to sleep, but it’s often treated as an investment. So you would still see currency value fluctuations. Currency issue by gov’ts largely has worth because the gov’t says that it has worth; it’s not tied to anything. (BTW - tying currency to a tangible asset limits your ability to add currency when necessary. It will tend to lead to depreciation–the value of the currency rising–which is usually a bad thing.)
The other problem is that corporations and banks go bust; if they were issuing currency, that would mean all your money would instantly be worthless.
Thanks for that. I am not suggesting it need to be directly tangible like the gold standard, but something ostensibly public (perhaps embedded into an international economic alliance) that is directly ties to ownership of a secure portfolio of investments across a variety of intrinsically valuable staples or otherwise being carefully managed by skilled investors.
Think 401K, and the bond market, but without being subject to the whims of national foreign policy.
Crypto regardless of how impenetrable it is technologically, if it’s inevitably controlled by unethical actors, it’s still worse for the world and not a safe investment to recommend. And like everything else, tangible or untangable, it’s value is still subject to market interest, i.e. as you say, people agreeing to pay for it assuming others will buy it off them in the future.
Well, kind of. But the worth of those assets is largely due to perception, rather than real utility value. Like, real estate is stupidly expensive in many places, but it’s expensive because people believe that it’s expensive. When real estate bubble burst, you see the ‘worth’ of that real estate drop sharply. The utility value is having a place to sleep, but it’s often treated as an investment. So you would still see currency value fluctuations. Currency issue by gov’ts largely has worth because the gov’t says that it has worth; it’s not tied to anything. (BTW - tying currency to a tangible asset limits your ability to add currency when necessary. It will tend to lead to depreciation–the value of the currency rising–which is usually a bad thing.)
The other problem is that corporations and banks go bust; if they were issuing currency, that would mean all your money would instantly be worthless.
Thanks for that. I am not suggesting it need to be directly tangible like the gold standard, but something ostensibly public (perhaps embedded into an international economic alliance) that is directly ties to ownership of a secure portfolio of investments across a variety of intrinsically valuable staples or otherwise being carefully managed by skilled investors.
Think 401K, and the bond market, but without being subject to the whims of national foreign policy.
Crypto regardless of how impenetrable it is technologically, if it’s inevitably controlled by unethical actors, it’s still worse for the world and not a safe investment to recommend. And like everything else, tangible or untangable, it’s value is still subject to market interest, i.e. as you say, people agreeing to pay for it assuming others will buy it off them in the future.