Thread - Nostr Hypermedia

Classic rationalizations of fiat. The core flaw in your argument is that you're treating money as if it's productive, like a cow that gives milk or a fruit tree that bears fruit. But money is sterile—it doesn't grow, reproduce, or produce anything by itself. When you lend 100 grams of gold and demand 150 back, that extra 50 grams doesn't come from any new wealth created by the money sitting in your pocket. It has to come from somewhere else in the economy—from the borrower's labor, from consumers, or from new money entering the system. You're demanding payment for literally nothing but the passage of time. That's the theft: you're selling something that doesn't exist (the "fruit" of barren metal) and forcing the productive part of society to pay you tribute forever just for using what should be a neutral medium of exchange. Your risk argument falls apart too. Real risk (like investing in a farm or a business) deserves profit because you're sharing in actual productive enterprise. But a full-recourse loan backed by collateral isn't true risk-sharing—you get your principal plus interest no matter what, and if the borrower defaults, you seize his assets. Heads you win, tails he loses twice. That's not "bird in the hand"—that's rigging the game. Time preference doesn't create value out of thin air either. My preferring a house today over one in ten years doesn't entitle me to demand someone build me an extra half-house for free. Money is supposed to facilitate exchange, not be a perpetual claim on the future labor of others. The entire fiat debt-slavery system exists because central banks and fractional-reserve banks can create infinite credit from nothing and charge compound interest on it forever—guaranteeing a perpetual transfer of wealth from producers to money-creators. Bitcoin's hard cap restores money's sterility: you can't lend out what doesn't exist, no endless debt spiral, no parasitic class living off interest on fake money. Your "fair exchange" defense is exactly what defends the Cantillon racket Bitcoin was invented to destroy. Usury isn't freedom—it's the means by which everyone is enslaved.

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npub1wuhe...h6ym 2 weeks ago

I made no appeal to fiat, which is government declaring something as money. Gold is not fiat money, it is honest, real, market money. Money has never been and should not be considered sterile. The example I used was gold, which has use besides that of a medium of exchange. See Mises' regression theorem for this. Regardless of whether we use gold, even if we were talking about fiat money, by your definition of sterility, no goods grow, reproduce, or produce anything by themselves. Whether I denominate the loan in corn, sheep, gold, or paper, it doesn't change the analysis. My example assumed no new money creation and explained where interest comes from, namely time preference, and where the seemingly new money can practically come from, namely other loan defaults and consumption of the lender. The borrower is not compelled to borrow and the lender is not compelled to lend. There is no more theft here than in any other voluntary exchange. Do you really think the lender is not sharing in the risk of the borrower's enterprise? Even with collateral, the future is uncertain, and the collateral may not be worth what it was at the time of the agreement, much like there is no guarantee that the money will be worth what it was at the time of the agreement. This is true whether we assume honest or dishonest money. Nothing in my example assumed fiat, nothing assumed fractional-reserved banking, nothing assumed dishonest money creation from nothing. I agree that all those are bad. I also think that if we used honest money and if we considered counterfeiting as anti-social activity, then there would indeed be fewer people borrowing out of desperation. The reason is related to what you mentioned: fractional-reserve banking and/or fiat destroy the purchasing power of money and therefore create a perverse incentive to borrow or invest when simple honset money saving would have sufficed. Do you honestly use an em-dash in your everyday posts? Or am I arguing with an LLM?

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