Thread by @ounwosu_

On the #bitcoin standard: Pt 1

- 21 million bitcoins.
There's no economic relevance of the number "21 million".

This is because money supply is an irrelevant metric as long as the monetary medium is infinitely divisible. What really counts is its purchasing power.

If your economics textbook says otherwise, you should burn it at the stake or give "mai suya".

- When Keynesian economists ask how the world would have gotten past the great depression, they fail to accept the fact that not all years are gonna look alike and charts are not ...

going to be green on all days. There willl be "market corrections" and new "suppprt lines" but such retracement is only a charge for a new all time high.

The Austrian school explains that the lower price levels was because of the economic boom but with a fixed supply of money.

This induced higher savings. Although present consumption fell, higher savings meant more capital investment and higher consumption and level of well being for the future. Again, the market would have found a new equilibrium point for price and wages.

After all, what's important for money is not the quantity but the purchasing power.

But lack of patience made them say, "no, we gotta solve this now in somehow no matter how artificially induced the solution may be. Hence, Keynes macroeconomic solution being short term focused.

He however noted that with his plans, things may not turn out as planned in the long run but who cares afterall, in the long run, we're all dead.

- #Keynes lazy mantra, "in the long run, we're all dead" was not the result of any economic inquisition.

It was the 1930s equivalent of today's "YOLO" mantra. Keynes was part of the "rich brats", that didn't fancy their parents generation of savings and morality. He literally lived the "fast and wild life" and his "economic theory" simply followed that philosophy.

Today, the core of his theory: unemployment vs inflation has been disproven by reality but we still have to learn it as lazy economists. We then say it is a "short-run" phenomenon.

- Hayek in his denationalisation of money propagated the #austrianeconomics school's theory of money - free markets for money. That is different monetary mediums should compete. He noted that individuals will gravitate towards the most stable in value (think of bitcoin maxis).

Then network effect will take place and render the other competitors useless. #Gold was the real life example from the post-renaissance period.

- To conclude this part 1
It is sad that for someone who lives in a country that experiences both stagflation and an ineffective tax system (it's not a significant factor of our economic changes), I only got lectured about Keynesian & Monetary economics & in an absolutist fashion

Basically, I couldn't relate my reality to what I was being taught and economics is supposed to be an ongoing inquiry into the causes of the wealth of nations.

#economics
#wealth

The Pt 2 of this series is going to focus on the statement, "money may not be the most important thing on earth but it affects everything that you consider important" but from an #economics standpoint.

If you'd like to see it, kindly RT this thread 🙏

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