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What kind of economy will emerge in a post oil world?
Re: What kind of economy will emerge in a post oil world?
by MonteQuest » Wed 05 Nov 2014, 14:15:06
$this->bbcode_second_pass_quote('careinke', 'M')onte, I understand very well that BAU currencies today, are based on debt and centralized banks. But they don't have to be.
But I keep asking. What will the value of a bitcoin be based upon if not faith in GDP growth?
What of credit? How will BItcoins be loaned with interest? Where will the interest money come from?
A Saudi saying, "My father rode a camel. I drive a car. My son flies a jet-plane. His son will ride a camel."
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Re: What kind of economy will emerge in a post oil world?
by DesuMaiden » Sat 08 Nov 2014, 15:19:05
How does bit coins have anything to do with an economy in a post oil world?
History repeats itself. Just everytime with different characters and players.
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Re: What kind of economy will emerge in a post oil world?
by radon1 » Sat 08 Nov 2014, 19:49:55
$this->bbcode_second_pass_quote('MonteQuest', '')$this->bbcode_second_pass_quote('vtsnowedin', 'C')urrency will remain due to it's utility.
But what will it be based upon? Currently, it is debt-based and loaned into existence. And without growth in GDP, there is no debt-based currency possible.
In a non-growth environment, we can take any tradeable item, such as a measure of wheat, or a golden coin, or anything else alike, and use it as a benchmark for exchange. This will be the new money.
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Re: What kind of economy will emerge in a post oil world?
by radon1 » Sat 08 Nov 2014, 20:12:15
$this->bbcode_second_pass_quote('Pops', '
')The point of capitalism is not growth but profit, growth may be an offshoot but is not a requirement - and not on everyone needs to be profiting either, creative destruction being a central tenet. Obviously no or negative growth doesn't equal the end of capitalism or it would have long since went kaput.
Since much of the modern, especially the rich world economy is based on waste enabled by cheap energy, if/when cheap energy leaves us there will be a very long period of deflation as the fat (then meat) is wrung out. But again, since capitalism is not defined by growth but by profit from private property and private labor, it will survive as long as the legal framework allows. There is profit to be made in any situation; even the worst disaster and humans will not become 100% self-sufficient next Tuesday, so opportunities will abound.
')The point of capitalism is not growth but profit, growth may be an offshoot but is not a requirement - and not on everyone needs to be profiting either, creative destruction being a central tenet. Obviously no or negative growth doesn't equal the end of capitalism or it would have long since went kaput.
Since much of the modern, especially the rich world economy is based on waste enabled by cheap energy, if/when cheap energy leaves us there will be a very long period of deflation as the fat (then meat) is wrung out. But again, since capitalism is not defined by growth but by profit from private property and private labor, it will survive as long as the legal framework allows. There is profit to be made in any situation; even the worst disaster and humans will not become 100% self-sufficient next Tuesday, so opportunities will abound.
How is profit different from growth?
Capital is nothing else but the other side of the balance sheet, the equity, i.e. assets less liabilities. Profit is nothing else but the growth of the capital (or a crucial component thereof). If you cannot ensure the growth of capital, the notion of capital (and capitalism) becomes pretty meaningless. A feudal lord does not need to care about capital, he is perfectly OK with his assets. He can squeeze as much as he pleases from them.
For the same reason, capitalism is impossible without the financial sector. Financial sector essentially ensures the fluidity of capital, giving the meaning to that other side of the balance sheet. Absent the financial sector, we will again have a feudal lord milking his assets.
The growth of the financial sector is quite natural. Its role is to enable interaction between various markets, and as the distances travelled between the markets become longer, the share of the financial sector grows. Also, the financial sector tends to concentrate in particular locations. So, while the total share of the financial sector may remain stagnant or increase slowly, its share in a particular location may experience a rather dramatic rise. This is actually a blessing, because these locations tend to pay abnormally high salaries for the same type of work as a result of anomalous money concentration.
Last edited by radon1 on Sat 08 Nov 2014, 20:16:39, edited 1 time in total.
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Still the fact remains that crypto currencies exist, and their use is expanding.