You're just not valuing money correctly if you buy more when the velocity goes up. The correct reason to buy more is more future production.
Post by twetch#1489
Agree, velocity can be a symptom of an increase in economic activity, but that is totally different from asessing future productivity.
What the chain says
- Block
- 633 873
- Time
- 2020-05-07T19:30:15Z
- Signer
- 1G7DLq695juhR7QFz5jn1AaXH55Hxn4kZS
- App
- twetch
- Type
- post
- Content type
- text/plain
- Name in tx
- twetch#1489
Fields the transaction did not carry are omitted. Open the payload to see the bytes as stored.
Signed by
1G7DLq695juhR7QFz5jn1AaXH55Hxn4kZS VerifiedReplies (3)
Velocity of money, in the traditional sense, is an artificial construct, a derivative produced in an effort to explain the world, not something directly observed.
https://mises.org/wire/problem-velocity-money
Of course, more txns on BSV is good.
I wouldn’t say totally different - future productivity is certainly impacted by inflation, no?
I was trying to imagine how an increase in economic activity could create lower velocity.
Sure, maybe after some period of time, but ‘in the now’?
Since GDP is in the numerator, you can link velocity to economic activity supposing money supply is constant, but one thing is present and another is future economy.