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> As an employee, in a growing economy denominated in bitcoin, you would see your pay drop frequently as the money supply gets stretched. There's no reason at a

> As an employee, in a growing economy denominated in bitcoin, you would see your pay drop frequently as the money supply gets stretched. There's no reason at all to think BTC-denominated salaries would be able to stay constant as the value of the money rises. Assuming the world productivity is denominated in 21 million bitcoin, if world productivity grows by 3% per year, my salary of 1 bitcoin gets more purchasing power. This is where you get a lever with your employer, he needs you to earn less, you don't have to negotiate to earn more (same applies to minimum wage, it needs to be adjusted upwards in a inflationary monetary system) Every money is inherently more valuable yesterday than today, as you can divest it. I would argue that it is very much in the interest of the wider society to have their savings not inflated. The best way to make your money work will always be to invest it in productivity, be it in educating yourself or investing it in companies. This investments need to be a lot more smarter and more sustainable than those of today, as the base money is not worth less every year. I think wasteful spending is a property of an inflationary money, where smart spending would be a required property in a non-inflationary money.

Nursie 6y ago
There's no lever there. In a bitcoin economy there's no chance your contract gives you a fixed salary in the first place, it would be tied to some measure of inflation. Like I said, most of the rest is just a rehash of gold standard stuff.
- ballofrubber 6y ago
  > Like I said, most of the rest is just a rehash of gold standard stuff. Exactly, however bitcoin is infinitely better money than gold and makes the "gold standard" viable. Fortunately the gold standard has a lot of proponents globally, some of whom started embracing bitcoin. I just hope that the experiment bitcoin keeps on going and I'm guessing we will see some form of resolution, maybe even in this decade. There is a lot to learn still.
  - Nursie 6y ago
    Ah, I see, you haven't figured out why the gold standard was terrible either.
    - ballofrubber 6y ago
      Tbh. my very basic knowledge comes from strongly opinionated austrian economics literature, which tends to confirm my bias, and from [0], which at least gives me some data points to refer to. Do you mind giving me some of your arguments why it's terrible? [0] https://wtfhappenedin1971.com/ https://wtfhappenedin1971.com/
      - Nursie 6y ago
        I mean, for a start 'Austrian' economics is a joke. There's plenty of literature out there about the end of gold standards in various countries. The upshot of it is that economies get warped by constrained currency supply and those who already have tend to get more, over those who produce or invest.
        dragonwriter 6y ago
        > I mean, for a start 'Austrian' economics is a bit of a joke. More specifically, Austrian economics is overtly and proudly ideological rather than empirical; it is about advancing an agenda not describing reality. It's worth taking seriously, but as a particular group’s body of theology and religious propaganda, not as science.
        AnimalMuppet 6y ago
        "It's terrible, it's a joke" isn't an argument. Neither is "there's lots of literature" (implying "go do your own research"). Your last sentence was decent; the rest of your post was... not very useful.
        Nursie 6y ago
        > "It's terrible, it's a joke" isn't an argument. True, it's not so much an argument as a fact. As the other poster says, it's basically a set of idealogical positions. > implying "go do your own research" You're right, I shouldn't have left that to implication.
africanboy 6y ago
> if world productivity grows by 3% per year, my salary of 1 bitcoin gets more purchasing power. but you are going to pay more for the same goods and services if your bitcoin is 3% more valuable, when you use it to buy milk it's going to cost you 3% more the game is working only because today if bitcoins increase their value you can exchange them for more fiat money in a bitcoin economy one bitcoin is worth exactly one bitcoin, forever, whatever that buys
- ballofrubber 6y ago
  In a non-inflationary monetary system cost of goods decreases every year, thats how productivity growth works. You seem to have it backwards, this is where the Econo101 book from the parent comment might help ;) /s Inflation drives down the purchasing power, hence why milk gets more expensive every year, even though we get much more efficient at producing it. Remove inflation and 1 bitcoin buys you a liter today and 1.03 litres next year.
  - africanboy 6y ago
    > In a non-inflationary monetary system cost of goods decreases every year and so do salaries, they are a cost to someone ... as long as your purchasing power stays the same salaries will go down as well. it's simply natural. you can't really believe that billions of people will get rich by sitting on the salary of a single year BTW that liter of milk will generate 3% more profit to the seller. there is no incentive to lower the prices if hoarding is so rewarding
    - ballofrubber 6y ago
      Salaries are negotiable and the renegotiation lever is skewed towards the employee. e.g. "i accept the pay cut of 3%, but will need 2 days of vaction more" vs "please employer pay me 3% more to combat inflation" You won't get more rich by sitting on your salary, but you will also not get more poor like you do today. If the milk seller doesn't lower his prices a competitor will do that, as he is able to do that with the bigger margin the better productivity brought.
UncleMeat 6y ago
> my salary of 1 bitcoin gets more purchasing power You assume your salary remains fixed. Why would it? As a portion of global productivity, your contribution shrinks.
- ballofrubber 6y ago
  Unfortunately my salary is fixed today as well and not only does it shrink as a portion of global productivity, but also as a portion of the monetary supply.
  - Nursie 6y ago
    Why would or should your salary ever be a fixed proportion of either of those things? Your labour certainly isn't.

Nursie 6y ago

There's no lever there. In a bitcoin economy there's no chance your contract gives you a fixed salary in the first place, it would be tied to some measure of inflation. Like I said, most of the rest is just a rehash of gold standard stuff.

ballofrubber 6y ago
> Like I said, most of the rest is just a rehash of gold standard stuff. Exactly, however bitcoin is infinitely better money than gold and makes the "gold standard" viable. Fortunately the gold standard has a lot of proponents globally, some of whom started embracing bitcoin. I just hope that the experiment bitcoin keeps on going and I'm guessing we will see some form of resolution, maybe even in this decade. There is a lot to learn still.
- Nursie 6y ago
  Ah, I see, you haven't figured out why the gold standard was terrible either.
  - ballofrubber 6y ago
    Tbh. my very basic knowledge comes from strongly opinionated austrian economics literature, which tends to confirm my bias, and from [0], which at least gives me some data points to refer to. Do you mind giving me some of your arguments why it's terrible? [0] https://wtfhappenedin1971.com/ https://wtfhappenedin1971.com/
    - Nursie 6y ago
      I mean, for a start 'Austrian' economics is a joke. There's plenty of literature out there about the end of gold standards in various countries. The upshot of it is that economies get warped by constrained currency supply and those who already have tend to get more, over those who produce or invest.
      - dragonwriter 6y ago
        > I mean, for a start 'Austrian' economics is a bit of a joke. More specifically, Austrian economics is overtly and proudly ideological rather than empirical; it is about advancing an agenda not describing reality. It's worth taking seriously, but as a particular group’s body of theology and religious propaganda, not as science.
      - AnimalMuppet 6y ago
        "It's terrible, it's a joke" isn't an argument. Neither is "there's lots of literature" (implying "go do your own research"). Your last sentence was decent; the rest of your post was... not very useful.
        Nursie 6y ago
        > "It's terrible, it's a joke" isn't an argument. True, it's not so much an argument as a fact. As the other poster says, it's basically a set of idealogical positions. > implying "go do your own research" You're right, I shouldn't have left that to implication.

africanboy 6y ago

> if world productivity grows by 3% per year, my salary of 1 bitcoin gets more purchasing power. but you are going to pay more for the same goods and services if your bitcoin is 3% more valuable, when you use it to buy milk it's going to cost you 3% more the game is working only because today if bitcoins increase their value you can exchange them for more fiat money in a bitcoin economy one bitcoin is worth exactly one bitcoin, forever, whatever that buys

ballofrubber 6y ago
In a non-inflationary monetary system cost of goods decreases every year, thats how productivity growth works. You seem to have it backwards, this is where the Econo101 book from the parent comment might help ;) /s Inflation drives down the purchasing power, hence why milk gets more expensive every year, even though we get much more efficient at producing it. Remove inflation and 1 bitcoin buys you a liter today and 1.03 litres next year.
- africanboy 6y ago
  > In a non-inflationary monetary system cost of goods decreases every year and so do salaries, they are a cost to someone ... as long as your purchasing power stays the same salaries will go down as well. it's simply natural. you can't really believe that billions of people will get rich by sitting on the salary of a single year BTW that liter of milk will generate 3% more profit to the seller. there is no incentive to lower the prices if hoarding is so rewarding
  - ballofrubber 6y ago
    Salaries are negotiable and the renegotiation lever is skewed towards the employee. e.g. "i accept the pay cut of 3%, but will need 2 days of vaction more" vs "please employer pay me 3% more to combat inflation" You won't get more rich by sitting on your salary, but you will also not get more poor like you do today. If the milk seller doesn't lower his prices a competitor will do that, as he is able to do that with the bigger margin the better productivity brought.

UncleMeat 6y ago

> my salary of 1 bitcoin gets more purchasing power You assume your salary remains fixed. Why would it? As a portion of global productivity, your contribution shrinks.

ballofrubber 6y ago
Unfortunately my salary is fixed today as well and not only does it shrink as a portion of global productivity, but also as a portion of the monetary supply.
- Nursie 6y ago
  Why would or should your salary ever be a fixed proportion of either of those things? Your labour certainly isn't.