It depends on who you ask and how long your memory is…
Annual Inflation of the entirety of 1974 was higher than 10% …
This is the inflation index which tracks items in a consumer basket… not a particular item in that basket.
So, if a loaf of bread is for sale at $1.00 today and any given loaf of bread is for sale for $1.00 tomorrow… the inflation is 0% … It doesn’t matter that Wonderbread replaced Wunderfully Breadful as the bottom rung product… nor does it matter that Wunderfully Breadful uses “accidentally” lead laced flour because of cost savings in the grist mill… just so long as there’s A Loaf of Bread for sale at $1.00 …
If the Inflation is pegged at 10% each and every month for a year… one could make guess at the value of a dollar and what it meant for a typical consumer on any given day during 1974 America - remembering that product quality is not included in that index.
And then there are plenty of examples of hyper inflation in many countries across the world in the last 100 years:
Usually hyperinflation occurs in times of intense geopolitical conflict. It’s important to remember that there’s no real reason why USD couldn’t do the same… The forces that stave off hyperinflation are very brittle, much more so than most people would like to admit.
Generally, diversification of assets is the best defense against poverty inducing hyperinflation.
I’ll gladly admit that I’m reaching here… … And… that I’m definitely all-in on crypto!
But… I think it’s important to realize that USD is not solid ground and probably has seen its peak level of stability already… or maybe not… one never knows.
the nails are going into the petrodollar’s coffin, and so now ends the ability for the united states to keep printing money as they please because it was a great reserve currency, while Saudi Arabia would only take dollars for crude…
i’m sure there is a backup plan… the question is how good it is… i doubt any can really compare to what has been going on tho…
it’s like the absurd evaluations of american tech companies… lol worth more than Europe’s total stock-market…
You can’t compare it so easy. USD is globally controlled. All the world banks have bonds and whatever based on USD, even some other fiat currencies are based on USD.
American Central Bank has been printing huge amounts of money for years. More Money in the market means less value, but the value did not reduce, so it means it is held high artificially. In some point in time that bubble may pop and then gloabally it will be an issue.
This is my believe. Correct me if I’m wrong, I’m not an expert.
Yes ETH is less stable than USD, but is fairly stable for crypto since it has a large trading volume and can’t be influenced to easy. The main issue is that every Coin value is based on USD. If the value of USD changes, so does the rest.
I’d say that the market and value of crypto coins can be manipulated more easily than the value of USD.
If a big bank got robbed or hacked, the price of USD would not go down as much as the price of Bitcoin can go down if an exchange is hacked.
A smaller coin can be manipulated more easily. Buying or selling STORJ tokens to the amount of $1M would probably affect the price a lot. Doing so with bitcoin would affect the price less.
Right - I’ll check with you first next time I need to compare things
Can you expand on what this means?
I believe banks are free to choose any assets and they do hold reserves in different currencies/metals, some considering to include crypto just recently. The reason so many hold USD is because they choose to and can change their choice any time. Should there be a better alternative - the market will adjust accordingly, sell off USD and buy that instead.
This seems to contradict the market. USD is loosing value the more USD is printed and market is adjusting accordingly just like with any other currency. There’s no entity that can declare or enforce the desired value for USD because anyone holding it can and will sell it right away. I think Central Bank is indeed printing money and it get’s reflected in inflation rates. It co-relates with printed volume so that printing is already priced in the current value of USD. If they double the amount of USD in one day it will loose half it’s value shortly after. Cryptos are also currently printed and priced in.
Other then printing money Central Bank can also influence USD using it’s reserves - basically buying USD when it goes down and selling when it goes up. The purpose of this is to make it more stable over time and to calm panic movements on the market. The power of this technique is limited by the size of reserve(which is modest compared to cap) and can’t be used to influence USD value significantly long term. Again, every central band is doing this.
There are some examples where national currency value is artificially enforced to certain value inside the country but global market doesn’t care about that, it’s definitely not the case with USD.
Meanwhile ETH and STORJ lost a lot of value since start of the month, how is this going to affect payouts?
Quantitative easing increases the money supply by purchasing assets with newly-created bank reserves in order to provide banks with more liquidity.
Central Banks also control the interest rates… which are at/near zero and in some places negative…
A negative interest rate means that putting money in a bank costs you money.
These policies offer massive amounts of wealth to the wealthiest… while depleting the purchasing power of everyone else… unless one believes in “Trickle Down Economics”
Of course they chose, but that was time ago. The choice can’t be changed so easily.To sell off means that there has to be someone to buy it. If no one wants to have USD then you can’t sell them.
… And… that I’m definitely all-in on crypto!