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Instead, a Bitcoin standard would incentivize efficient capital allocation, economic cooperation and more free trade.
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Instead, a Bitcoin standard would incentivize efficient capital allocation, economic cooperation and more free trade.
The below is a direct excerpt of Marty's Bent Issue #1136: "The incentives are screwed: exhibit 21,212."[2] Sign up for the newsletter here[3].
The externalities of unfettered money printing are extremely overweight to the negative side of the spectrum. When the government has the ability to work in conjunction with central banks to print money ex-nihilo to fund an activity, those who are in control of managing that activity are incentivized to be extremely wasteful to justify their budgets funded by the money printer. There is no greater example of this than the US military, which currently boasts an annual budget of $768.2B for 2022.
Year in and year out the puppets in Washington DC debate about whether or not the military budget should be increased. Inevitably, over the long term, the budget has expanded to obscene levels. Why does this happen? How does this happen? And what does an ever expanding budget do to the incentives of those in charge of the military?
Those from the Pentagon who hit the Hill to explain just how much they need in any given year to the puppets will tell you that the "why" is that there are ever-growing external threats that America needs to defend itself against and they will need more money to protect against them. In reality, as our friend GodSaysHodl explains above, the "why does this happen" probably has more to do with the fact that bureaucratic entities like having money to spend and they only get more money if looks like they
