It’s probable clear if you have read any of my other posts that I am fairly active on the question and answer site Quora. I generally answer questions in the finance category and I like to focus on topics that are often misunderstood. Yesterday, I noticed that someone had commented on my answer to the question “what is your one-sentence solution to economic decline?”
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I have tried not to rant about Bitcoin and other cryptocurrencies, but I can’t help myself. As you may have gathered from my earlier comments on technology in finance, I don’t really think that cryptocurrencies are a big deal. However, it’s not the cryptocurrencies themselves that I find annoying, it’s the people who promote them. These groups combine a total lack of understanding of finance with enough arrogance to believe that they have the answers to every single problem in finance. In fact, it’s even worse because many don’t even have a good understanding of the problems in finance. If they actually understood the problems in the financial system, they would realize that we don’t need a f**king currency. I would suggest they start by reading the Financial Crisis Inquiry Report and looking at the suggestions the commission makes.
Instead of reading and maybe doing something useful, these brave souls have done an amazing job of misunderstanding money creation in a modern economy, how the banking system works, where inflation comes from, the sources of inequality, and they also don’t even realize that they are proposing that the financial system use an even worse idea than fractional reserve banking.
I’m well aware that no one wants to sit and read a 15,000 word post about cryptocurrencies, so I am going to break this discussion into several different posts. In each post I will give evidence to back up my claims about the problems with cryptocurrencies, and give a basic overview of how the banking system actually works. I will also address some of the problems in finance in some detail. I hope to have the next post online by Friday.
