When central banks intervene in the markets by conducting open market operations (i.e. increasing the supply of money) or lowering policy rates the end result is always the same: an artificially lower cost of borrowing.
This creates distortions that encourage entrepreneurs to take on projects that would not otherwise be sustainable at the market determined cost of borrowing.
The economy becomes overleveraged and eventually leads to a bust when interest rates increase.
#Bitcoin fixes this.
The Coin Files
npub1w6…w4fzu
2023-11-28 15:26:18
Author Public Key
npub1w6cjjl03lzgn3gj42uyh9myaqsukqcp7h2z6p35sml5sx8temy6qxw4fzuPublished at
2023-11-28 15:26:18Event JSON
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"created_at": 1701185178,
"kind": 1,
"tags": [
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"content": "When central banks intervene in the markets by conducting open market operations (i.e. increasing the supply of money) or lowering policy rates the end result is always the same: an artificially lower cost of borrowing.\n\nThis creates distortions that encourage entrepreneurs to take on projects that would not otherwise be sustainable at the market determined cost of borrowing.\n\nThe economy becomes overleveraged and eventually leads to a bust when interest rates increase.\n\n#Bitcoin fixes this.",
"sig": "137e46008ecd76b6f115a652ee52f752904aa65a73fff62ef3969ef7d059840a3707590137d83ff5ce98a9bef1ad7ddac3627a5af4b48842c43994ab96ae02c0"
}