I believe its you who dont understand basic economics. If tomorrow the entire planet will decide that gold is worthless, it will be worthless along with USD.
Currency is everything we consider of value. If its limited (like bitcoins & gold) the inflation wouldn't be a major issue on the long term. If its not limited, like USD (which is getting printed constantly) the inflation will strike back soon enough. Remember, once you could buy pretty much for $1?
I'll be honest lancis, sounds to me like someone needs to sell their BitCoin
And we can go back and forth and say "no it's you who doesn't understand basic economics," but laws that have been in place for millennia don't change. English words do change, but not on a daily basis.
currency |ˈkərənsē; ˈkə-rənsē|
noun ( pl. -cies)
1 a system of money in general use in a particular country :
the dollar was a strong currency | travelers checks in foreign currency | figurative
he was rich in the currency of love.
If you can pick out "everything we consider of value" from that, then I believe you sir, are the most... creative... individual on this board.
BitCoins have no value. They are binary 0s and 1s. BitCoin only works in theory, because everyone is accepting it. For now. You cannot go to a farmer's market and trade BitCoins for food when you're hungry. You can't give them on a USB stick to a man playing a violin and expect to hear his music. If you get anything from my post, it's this:
There is no intrinsic value in BitCoins, and that is why they are worthless.
When the domino effect begins, it will implode. No sellers will accept it, and the effect will ripple exponentially. People will be like "but... but... I'm so smart and so technically savvy... I got into this BitCoin stuff, and now I've got these 1s and 0s that are encrypted with super international spy technology and.. and... errr.. FAAAAAA**!!!"
Mark my words, yes, it will really go down like that. USD is stable for the time being because it is backed by the US government, and the general public doesn't believe a behemoth like that can fail (it can). But you're already seeing it, aren't you? Massive trends toward an underground economy, people starting to use hard assets to trade. The demand for gold, silver, and other hard assets now is skyrocketing. Why? Because most people are feeling the effects of the collapsing economy, and on some level, even if they can't articulate it perfectly, are thinking, "If I wake up tomorrow, go to my local, friendly branch, and see a bunch of digital numbers in my account that are not the digital numbers that were there last time, I am ROYALLY F***ED."
A few years ago people started minting Ron Paul gold coins and the government raided them. Counterfeiting money was the first death sentence in our US Constitution, btw, because the founders knew how important control of the money supply was. RAIDING US CITIZENS -- FOR GOLD!! Why? Competition. In a free market, no one in their right mind would even think about using worthless US Dollars to trade, but we're forced to by the government. So it works, for now, because the government is propping it up, and on shaky legs it stands, shaky legs indeed.
Or: if I give you $100K, and 3 choices: 1-Cash in a bank, 2-Cash under your mattress, or 3-Gold, which do you choose, and why?
If you bought into the BitCoin bit, read Murray Rothbard's classic "What Has the Government Done With Our Money?", and cash out before the system crashes. You can find free PDFs online through Mises.