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Big-time Bankers' Crazy Crypto Blues
Cryptkeepers vs Cryptokeepers
An Ironic Argument
Bank of England's Expert Governor, Andrew Bailey on investing in crypto:
I'm afraid they don't have intrinsic value," Bailey told journalists on Thursday. "Now that doesn't mean to say that people don't put value on them because they can have extrinsic value. But they have no intrinsic value. "So I'm going to say this very bluntly again: buy them only if you're prepared to lose all your money."
Thus we have his primary argument against crypto, its cause of volatility from its lack of intrinsic value (intrinsic: belonging to the essential nature or constitution of a thing). Thus, crypto has extrinsic value (extrinsic: Not forming an essential or inherent part of a thing; extraneous).
Defining Fiat Money
But wait, is the UK pound sterling not but a fiat currency like the US dollar?
Since the suspension of the gold standard in 1931 the pound sterling has been fiat money, with its value determined by its continued acceptance in the national and international economy. The pound sterling is the world's oldest currency still in use and which has been in continuous use since its inception.
Cool. But what is fiat money?
Wikipedia:
Fiat money is a currency (a medium of exchange) established as money, often by government regulation. Fiat money does not have intrinsic value and does not have use value. It has value only because a government maintains its value, or because parties engaging in exchange agree on its value.[1] It was introduced as an alternative to commodity money (a medium which has its own intrinsic value) and representative money (money which represents something with intrinsic value). Representative money is similar to fiat money, but it represents a claim on a commodity (which can be redeemed to a greater or lesser extent).
Investopedia:
Fiat money is government-issued currency that is not backed by a physical commodity, such as gold or silver, but rather by the government that issued it. The value of fiat money is derived from the relationship between supply and demand and the stability of the issuing government, rather than the worth of a commodity backing it as is the case for commodity money. Most modern paper currencies are fiat currencies, including the U.S. dollar, the euro, and other major global currencies.
SoFi Learn:
A fiat currency is money that is not backed by a physical commodity like gold, but instead backed by the government that issued it. Most modern currencies, such as the U.S. dollar, euro, pound and yen, are fiat money. “Fiat” means “an authoritative or arbitrary order.” So in the case “fiat money,” it’s an order by the government that gives them value and makes them legal tender. The current fiat-money system came about during the 20th century when countries moved away from the gold standard, where currencies are directly linked to gold. There are currently some 180 fiat currencies in the world today. The value of fiat currencies is driven by the marketplace forces of supply and demand. Central banks control the supply, gauging how much money is needed in the economy and printing accordingly. The biggest risk is that they print too much, triggering a bout of hyperinflation–rapid, out-of-control price increases that can lead to economic devastation. Faith in a fiat currency hinges on the stability of the government that issues it, as well as trust in the central bank that manages its supply. Here’s a deeper dive into the fiat-currency systems that are fixtures of modern economies.
The Cost of Currencies
So really, fiat monay has NO intrinsic value whatsoever, thus making it extrinsic in value. Thus it should be highly volatile according to Mr. Banker Bailey's bogus definition. The only major difference that I can see is that crypto is decentralized whilst fiat is centralized. In other words, fiat has value because a government says so. Crypto has value because the people say so. Is it of any suprise that another weforoum-resetter is trying to scare the sheeple away from taking back control? "A day's wages for a loaf of bread" comes to mind...
Rev 6:5-6:
5 When he opened the third seal, I heard the third living creature say, “Come!” And I looked, and behold, a black horse! And its rider had a pair of scales in his hand. 6 And I heard what seemed to be a voice in the midst of the four living creatures, saying, “A quart[a] of wheat for a denarius,[b] and three quarts of barley for a denarius, and do not harm the oil and wine!”
If the fiat system is to continue on the path it is, hyperinflation will cause the people to lose faith in all things but food, water, materials, tools, and clothing (the essentials). Crypto can lose most of its value and collapse beause it's essentially backed on real-world currency (and the crutch of digital technology). Even commodities like gold have no nutritional or intrinsic value, gold's simply a rare metal and salt holds more value than diamonds. If the bankers continue printing, they will reap the reward of their greed and we all will suffer for it...
Ezekiel 7:19:
“‘They will throw their silver into the streets, and their gold will be treated as a thing unclean. Their silver and gold will not be able to deliver them in the day of the Lord’s wrath. It will not satisfy their hunger or fill their stomachs, for it has caused them to stumble into sin.
The great irony is the 2020 Davos summit is where the weforum pushed for embracing cypto.
What Bailey Should Have Babbled
Long story short, crypto has value because people say it does. Fiat has value because people allow the government to say it does. The only difference is that the greedy bankers control the amount of fiat out there as a ponzi scheme to make themselves richer. That's why Bailey makes no sense. It's just scare tactics to keep you away from crypto until the UK creates its own (even the US?). That's what happens when a government uses the crutch of economics to retain its power.
Assuming that the people retain their current faith in the blockchain, the only way you lose money in crypto is by treating it as a commodity, stock, security, or other capital asset and proceed to buy high and sell low. Or by gambling it all away. If people feel that marbles retain their value more than the dollar or sterling, then they are just as valid as a stable currency and if not, more. I want marble-based currencies world-wide as a meme referencing "The Blue Marble" and also because the idea of "rolling economics" sounds cool.
Thanks for reading, and HattyHacking;
