Buying shares does contribute a bit to the success of a company, and so will contribute a bit towards productivity. But not anywhere near what you're putting in as risk.
But, again, thinking of bitcoin as 'investment' is one of the greatest linguistic cons built off of previous cons. By buying them, your net contribution to society is negative.
But, again, thinking of bitcoin as 'investment' is one of the greatest linguistic cons built off of previous cons. By buying them, your net contribution to society is negative.
Lexicus
Deity
Not necessarily
QFT but this is also true of some other securities as well
In what sense? I’m not trying to be obtuse, but the act of buying and selling ownership of a company, I’m not seeing its direct contribution to its productive capacity.
RobAnybody
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While I would characterize that as an "investment". Which means you & I are probably using the term "investment" differently (not saying I am right, just recognizing it).
It's an interesting discussion, which probably merits its own thread. I view "buying a stock in an IPO" as different from "buying an existing stock". They could both be called an investment. I believe you are using investment in the former sense, while I am using investment to encompass both, & much more. I am using the term to mean "buy [something] now, in hopes it will appreciate in value".
Lexicus
Deity
It can raise money for the company to actually do things....or not
Your purchase provides price-support, at the spread of what you paid and what the next-lower person would have paid. A fraction of a penny? Less? It's a fleeting and ephemeral support, but it's real. And the 'benefit' is nowhere near the risk. If you're putting up $1k with a 10% downside risk, you're risking $100 to loan them a penny.
Companies can borrow against this price, they can issue new stocks at this price, they can reward employees at this price. Lexicus said "not necessarily", and that's true, but 'in general, it's true'.
If it weren't, then concerted efforts to siphon capital out of fossil carbon (divestment) would be pointless and managers would prefer salary to stock bonuses. Tesla wouldn't be where it is today without the piggy bank generated by enthusiastic buyers of the stock. I have to have this conversation often with people who want to 'invest' in arenas that facilitate the social development we want. I inevitably say that they're better served by making purchases based on fiscal prudence and donating a portion of any resulting income to research charities or social-support charities.
The damage done by owning bitcoin is different. It's still providing price-support, but it's providing price-support for bitcoin mining. Adding miners has diminishing returns on the service they provide but also increases the net damage done per update of the blockchain.
RobAnybody
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Just in case, because there's seems to be some confusion:
I think it's like how in comic books (which I am much more fluent in), you selling me a New Mutants #98 [EDIT: First appearance of Deadpool, who is quite popular] in 9.8 graded condition would net you nearly $2k. However Marvel, who published the initial comic book which you bought for $1.00 back in 1991 only got $1.00 of revenue back in 1991 & sees nothing from our transaction today.
So, to the extend the analogy... if you buy my share of Amazon for $2k (I have no idea), that nets Amazon $0. We simply made a transaction for an asset that already exists & has appreciated in value. People buying/selling shares of a stock does not grant additional money to the company that issued them.
I think it's like how in comic books (which I am much more fluent in), you selling me a New Mutants #98 [EDIT: First appearance of Deadpool, who is quite popular] in 9.8 graded condition would net you nearly $2k. However Marvel, who published the initial comic book which you bought for $1.00 back in 1991 only got $1.00 of revenue back in 1991 & sees nothing from our transaction today.
So, to the extend the analogy... if you buy my share of Amazon for $2k (I have no idea), that nets Amazon $0. We simply made a transaction for an asset that already exists & has appreciated in value. People buying/selling shares of a stock does not grant additional money to the company that issued them.
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Sorry, I was talking about used (pre-owned?
) stock.Okay, that's the point I was looking for.
This does make a contribution. I don't doubt the value of stocks to investors, but my question was about the benefits from the firm's side.
More on "Capitalists do not know anything about money":
François Villeroy de Galhau, governor of the Bank of France, said at Davos on Monday that he does not refer to crypto assets as cryptocurrencies.
“They are not reliable currencies, they are not a reliable means of payment,” he said. “In order to be a currency somebody must be responsible for the value—nobody is responsible for the value of cryptos. And it must be accepted universally as a means of exchange—it’s not.”
This may seem to be true in a world dominated by fiat currency, but this is a new idea. Though most of human history the value of currency has been determined by peoples belief in the value of something, be that cowries, stones with holes in or gold. Also very few things have been "accepted universally", I guess gold comes close but many currencies have been localised, both geographically and by sector of the economy.“They are not reliable currencies, they are not a reliable means of payment,” he said. “In order to be a currency somebody must be responsible for the value—nobody is responsible for the value of cryptos. And it must be accepted universally as a means of exchange—it’s not.”
Are those really currencies, though? Gold (and other commodities) can be used as money, but is not really a currency until someone mints their head on it and thus becoming responsible for the value of the resulting coins.
EnglishEdward
Deity
In my opinion, Bitcoin ought to be made illegal, because the energy
required to data-mine for blockchains is an environmental threat.
required to data-mine for blockchains is an environmental threat.
A couple of definitions:
Cambridge: the money that is used in a particular country at a particular time:
Investopedia: Currency is a medium of exchange for goods and services.
Both those definitions would seem to fit cowries and Rai.
My understanding was that at least initially the putting of someone head on it was more "This is Xg of gold, we have weighed it so you do not have to" rather than the modern meaning of a state backed currency.
The Wikipedia definition is
I don't think the Rai stones were standardized to the point where I would call it a currency. With the cowries, I am not sure, whether there were any standards at what point a shell was acceptable.
"We weighed it, so you don't have to" needs to be assured somehow, usually by some kind of authority. If this authority would not take responsibility for securing the value of the coin by turning a bling eye to forgers, the utility of the currency would quickly diminish.
Definitions aside, my practical assessment whether something is a currency or not, would be whether any pricing is done in this particular form of money. So instead of saying "this costs 1000 USD, but you may pay in bitcoin", the vendor would say: "this costs 0.1 Bitcoin" regardless of what the current price of Bitcoin is. So far, this is not really happening (with a few exceptions).
I guess the question then becomes what is the most important feature of a currency? Cryptocurrency does act as a medium of exchange that allows you to buy things you cannot buy with anything else. It is very "standardised", in that one bitcoin is worth the same as another.
The "what is stuff labelled in" is a bit artificial. Does a currency stop becoming a currency if it is so volatile that things are priced in dollars and the conversion is done at the till? That has happened quite a lot.
Bartering can happen with any asset, including currencies. But borrowing it might be a good indicator.
There are 3 parties that are agreeing upon a range of value. The value is backed by the fact that one party needs to get more.
There are 3 parties that are agreeing upon a range of value. The value is backed by the fact that one party needs to get more.
I am not 100% sure what you are saying, but the whole decentralised finance thing means borrowing cryptocurrency is much easier than any other unit of exchange. I am not sure who the 3 parties in the deal are, these usually work with smart contracts and trustless architectures so only 2 people (and they may not be people) are involved. You can even borrow for effectively zero time, but use the tokens, called a flash loan. It does not make much sense to me.
