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Offline 天籁

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The Biggest Secret of BitAssets
« on: November 28, 2014, 02:11:04 AM »

For example, BitUSD is just the USD base currency equivalent, not out of air, it is created with three times of the deposit. But modern banks can produce 10 times the flow of cash of base monetary  by 10% reserve, which causes endless inflation. If people use BitUSD instead of USD, M2 will be greatly reduced, there would not be infinite inflation.
« Last Edit: November 28, 2014, 03:51:08 AM by 天籁 »

Offline onceuponatime

Re: The Biggest Secret of BitAssets
« Reply #1 on: November 28, 2014, 02:30:08 AM »
And politicians will not be able to spend money they do not have (cannot tax) in  order to buy popularity......... and they will HATE you.

Offline 天籁

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Re: The Biggest Secret of BitAssets
« Reply #2 on: November 28, 2014, 02:33:19 AM »
And politicians will not be able to spend money they do not have (cannot tax) in  order to buy popularity......... and they will HATE you.
Correct!

Offline Empirical1.1

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Re: The Biggest Secret of BitAssets
« Reply #3 on: November 28, 2014, 02:34:57 AM »
For example, BitCNY is just the CNY base currency equivalent, not out of air, it is created with three times of the deposit. But modern Banks can produce 10 times the flow of cash of base monetary  by 10% reserve, which causes endless inflation. If people use BitCNY instead of CNY, M2 will be greatly reduced, there would not be infinite inflation.

 +5%

This good video from 8:00-10:00 shows how modern banks inflate the currency with a 10% reserve ratio.

http://m.youtube.com/watch?v=iFDe5kUUyT0


Offline toast

Re: The Biggest Secret of BitAssets
« Reply #4 on: November 28, 2014, 02:44:53 AM »
IDK, theoretically if the central bank didn't charge interest then the fractional reserve ratio would still not inflate the supply more than a finite amount. It's the fact that the central bank charges interest to force other banks to borrow even more dollars into existence from them that fundamentally fuels the inflation.
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Offline jsidhu

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Re: The Biggest Secret of BitAssets
« Reply #5 on: November 28, 2014, 07:20:26 AM »
Without interest there is no incentive to borrow or lend... its a catch 22.. its a ponzi scheme down to the roots.
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