Anil Profile picture
16 Sep, 24 tweets, 8 min read
The Price of Tomorrow by @JeffBooth explains what happens when deflationary technology meets inflationary money.

It’s also a guide for where we might be headed.

“What is coming next in technology changes the rules in a way that too few understand.”

🧵
Jeff is exceptional in anticipating the exponential speed at which technology develops, while understanding the surrounding economic environment.

Few are better positioned to explain what is happening today.
My key takeaway:

The speed of technology deflation outruns monetary inflation.

A mandate to create inflation is a losing battle against tech products + services that are, by nature, deflationary. It will only serve to unevenly redirect inflation into other areas of an economy.
“It took $185 trillion of debt to produce about $46 trillion of GDP growth over the last twenty years.

The growth rate would likely have been negative without all of that stimulus.”
“New technologies often change what is valuable in a way that is misunderstood by incumbents who have spent years perfecting their own playbook to win markets.”
“Creative destruction doesn’t happen at a steady rate over time. At certain points in history, there is more opportunity for entrepreneurs to create disruption

Disruption windows also open through breakthroughs in technology”
“Technology often changes where business value is derived from..

Digital delivery changed the rules.

Information could travel much further and faster, and, as a result, it reduced the value of traditional distribution power.”
"Strong network effects are at the core of every platform business today.

a network effect exists when the value of a product or service gives more value to each user as the number of users increases."
“Network effects are very different from the economies of scale which traditionally drove power.”
"Monopolies that have flourished for a long time are often overturned very quickly because they fail to recognize an impending transition.

Tipping points can come from anywhere and can come quite suddenly.."
From Taleb's 'Antifragile':

“Small forest fires periodically cleanse the system of the most flammable material, so this does not have the opportunity to accumulate."

"By continuing to add debt and kick the can down the road, governments and central banks have prevented some of the small fires—in this case, the pain of restructuring"
"Put the lagging GDP growth with illusionary asset inflation, plus an impossible-to-maintain rise of debt, against a backdrop of technology growing at an exponential rate, and the phase transition starts to come into focus."
What BLINDS us to change:
The two likely roads out of this ‘debt-mess’:

*Booth notes that neither address the root cause- inflationary monetary policy against deflationary technological progress
The Fed’s mandate of maximum employment is misguided.

“The abundance that technology provides us doesn’t require net new jobs around the world. It obliterates the work and the jobs we already have."
But Central Banks around the world are doubling down and running unproven monetary experiments.

“The proposed solution sees a mechanism where negative exchange rates are applied to both electronic money in reserves as well as cash”
“Bitcoin.. is an attempt at a solution.

The promise of Bitcoin was to create a system that was decentralized in nature, unable to be manipulated by anyone—including governments.”
“Bitcoin attempts to change that dynamic by forever fixing supply at twenty-one million Bitcoins. In addition to that, it creates a peer-to-peer ledger without any central control: the blockchain”

"What if, instead of trying to stop deflation at all costs, we embrace it?

It becomes much cheaper to live, and thus the burden to those working drops."
"The more that trust is eroded, the more likely that an alternative currency becomes a more trusted mechanism. That alternative—whether Bitcoin or something different—could emerge quickly."
"I wrote this book not because I had any desire to but because I grew tired of a lack of real debate about the core issues and solutions and am increasingly worried about world conflict if we don’t act."
/END

🙏Thanks for reading.
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More from @anilsaidso

3 Sep
This is the story of two disruptive innovations, several centuries apart, with remarkable similarities.

My hope is that you'll gain insight into the largely invisible technological forces that alter the incentives of obedience and steer the evolution of how we organise society.
What Johannes Gutenberg and Satoshi Nakamoto unleashed would prove to have ramifications far greater than anyone could have imagined at the respective time.
Their *information-freeing* innovations challenged stale and burdensome institutions, ripe for a grass-roots disruption.
Let’s begin with TRUST- the key ingredient that enables us to cooperate and trade.

Assessing it requires access to accurate information.
Maintaining it requires delivering on promises or social contracts.
Read 28 tweets
10 Aug
This thread represents over 1,000 hours of research, writing and design in an attempt to better explain Bitcoin as a concept.

These are the non-technical resources that I want newcomers to have access to as they begin their journey down the rabbit hole.

Happy Reading. 🐰
Next, a book summary that will help you understand money against the current technological, economic and sociopolitical backdrop.

Read 14 tweets
4 Aug
My understanding and appreciation of Bitcoin has been shaped by a handful of essays that brilliantly capture its unique properties and potential.

These authors do not dictate WHAT to think, but rather HOW to think BETTER.

Here's the list.. 🔖
1/ “History shows us that the corruption of monetary systems leads to moral decay, social collapse, and slavery.”
@Breedlove22

bit.ly/2PrOFZz
2/ "The 21st century emergence of Bitcoin, encryption, the internet, and millennials are more than just trends; they herald a wave of change that exhibits similar dynamics as the 16-17th century revolution that took place in Europe."
@TuurDemeester

bit.ly/2XpFo8M
Read 11 tweets
10 Jul
The Sovereign Individual (1999) is a guide for navigating the current transition from Industrial to Information Age.

Remarkably, it predicted the rise of 'digital gold'.

“If our deductions are correct, you stand at the threshold of the most sweeping revolution in history.”

A🧵
1/ "Widespread adoption of public-key/private-key encryption technologies will soon allow many economic activities to be completed anywhere you please."

"Many transactions in the Information Age will not need to be domiciled in any territorial sovereignty at all."
2/ From Monopoly to Competition

"This new economic dynamic directly contradicts the desire of government left over from the industrial era to impose monopoly pricing for its protection services."
Read 25 tweets
26 Jun
Comparing the $USD and #Bitcoin across three dimensions:

🔸Unit of Account: cent vs. satoshi

🔸Settlement: Centralized/permissioned (i.e. SWIFT) vs. decentralized/permissionless

🔸Monetary Policy: 12 member board meeting (8x/yr) vs. pre-determined, executed by code
'To maintain its value, money must be in limited supply.

The Fed.. carefully calibrates the supply of dollars to promote stable prices and maximum employment.

No central bank controls the supply of bitcoin.'

-Federal Reserve Bank of St. Louis
bit.ly/2CkMXG5
REACHING CONSENSUS:

USD-
The FOMC consists of 12 members, holding 8 meetings annually + additional as needed. Committee membership changes at the 1st meeting of the year. The minutes are released 3 weeks after policy decisions.

BTC-
Proof of Work
Read 6 tweets
25 Jun
Adapted from ‘How to Disagree’ (2008) by @paulg

Print it out. Stick it on your wall.

'the greatest benefit of disagreeing well is not just that it will make conversations better, but that it will make the people who have them happier.'

Original essay: bit.ly/3dCKAvo Image
The focus of your attention is like a beam of light.

You get to control the DIRECTION, SCOPE and INTENSITY.

You process what is illuminated and ignore what is left in the dark.

Choose accordingly. Image
The Window of Tolerance 🪟

"What really defines our optimal moments is that they are ones in which we are able to feel stable... to take things in our stride and to be neither weary nor fearful, bored nor manic."
- @TheSchoolOfLife

Original Essay: bit.ly/30woohT Image
Read 10 tweets

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