The inflation part is where I disagree.
The only reason to mine more gold is because the USD price is more than the cost to mine it, making it profitable by traditional thinking. There is an incentive to discover the gold because of a variety of economic and human factors.
Here is a thought experiment:
Pure economics doesn't dictate any reason to mine more gold. If we were on a gold standard today, and all mining stopped forever, what happens? Currency prices adjust to economic forces, and life moves on. Pure supply and demand dictate price, not inflation. As tech improves, life improves, and currency prices continue to drop because we are more efficient. It is deflationary, and Jeff Booth (npub1s05…eyhe) explains this very well.
So why mine gold? The same reason we print currency: to be closer to the source of funds, deploy the currency and "lock in" our financial plans...all before the currency prices rise. Small inflation is tolerable when asset prices, priced in fiat currency, grow higher than inflation.
But humans do not understand money. You cannot have the USD price of your 401k go up, and the price of your house go up, yet simultaneously have lower prices at the grocery store and the gas pump.
Currently all the gold in the world makes a ~70' square cube. That is enough gold for every country, they just have to get the currency price right. What countries need to adjust is the currency and the peg to the gold. for example $1 = 1oz. silver, and $20 = 1oz. gold.
If you want to "get richer" you can lower the price of your goods and services by being efficient, and passing the savings to your customers. They now have more free currency to save or invest.
You do not get "richer" by mining for more gold because that just makes prices go up, which steals purchasing power from people who saved in the currency. You get richer by providing value people pay for, not stealing value by debasing currency.
So I personally do not see a need for inflation in gold, or Monero. Inflation is a tool created by the fiat currency system. Debasement is the predecessor, which involved coin clipping, and mixing with base metal.
Delta Charlie
npub1aq…vmhkh
2024-02-12 12:09:51
in reply to nevent1q…gkg4
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npub1aqxs793kps5eanmvnse97at6nc975pg6e0c6tjzxq700x0jzdl7qvvmhkhPublished at
2024-02-12 12:09:51Event JSON
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"content": "The inflation part is where I disagree. \n\nThe only reason to mine more gold is because the USD price is more than the cost to mine it, making it profitable by traditional thinking. There is an incentive to discover the gold because of a variety of economic and human factors. \n\nHere is a thought experiment:\n\nPure economics doesn't dictate any reason to mine more gold. If we were on a gold standard today, and all mining stopped forever, what happens? Currency prices adjust to economic forces, and life moves on. Pure supply and demand dictate price, not inflation. As tech improves, life improves, and currency prices continue to drop because we are more efficient. It is deflationary, and nostr:npub1s05p3ha7en49dv8429tkk07nnfa9pcwczkf5x5qrdraqshxdje9sq6eyhe explains this very well.\n\nSo why mine gold? The same reason we print currency: to be closer to the source of funds, deploy the currency and \"lock in\" our financial plans...all before the currency prices rise. Small inflation is tolerable when asset prices, priced in fiat currency, grow higher than inflation. \n\nBut humans do not understand money. You cannot have the USD price of your 401k go up, and the price of your house go up, yet simultaneously have lower prices at the grocery store and the gas pump. \n\nCurrently all the gold in the world makes a ~70' square cube. That is enough gold for every country, they just have to get the currency price right. What countries need to adjust is the currency and the peg to the gold. for example $1 = 1oz. silver, and $20 = 1oz. gold. \n\nIf you want to \"get richer\" you can lower the price of your goods and services by being efficient, and passing the savings to your customers. They now have more free currency to save or invest.\n\nYou do not get \"richer\" by mining for more gold because that just makes prices go up, which steals purchasing power from people who saved in the currency. You get richer by providing value people pay for, not stealing value by debasing currency. \n\nSo I personally do not see a need for inflation in gold, or Monero. Inflation is a tool created by the fiat currency system. Debasement is the predecessor, which involved coin clipping, and mixing with base metal. \n\n\n\n",
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