That is false. Value is future production.
Post by twetch#7355
Future leverage is often cataclysmic to a system over many iterations, especially from a normalized predictability perspective, which is what underpins the current value.
The more volatile over a longer period, the less valuable it should be today, yet..
What the chain says
- Block
- 633 840
- Time
- 2020-05-07T15:15:48Z
- Signer
- 1J6h7Bex83EVCGvamT5LMVm9MECX4bSquW
- App
- twetch
- Type
- post
- Content type
- text/plain
- Name in tx
- twetch#7355
Fields the transaction did not carry are omitted. Open the payload to see the bytes as stored.
Signed by
1J6h7Bex83EVCGvamT5LMVm9MECX4bSquW VerifiedReplies (20)
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.
There’s levels to it, methinks.
For instance, when the Fed prints money, velocity is inevitably going to rise.
Banks ‘buy’ that money fast (tacking-on velocity + inflation), then turn around and leverage it (vi++) by loaning it, (vi++), etc etc.
This is why payday lending is a huge scam, and a terrible idea.
But buying at the top is the name of the game.
By the time that money trickles all the way down to that person who’s ‘buying’ it, it’s changed hands too many times.
Agree, velocity can be a symptom of an increase in economic activity, but that is totally different from asessing future productivity.
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.