Question for economists - which medium is "better" for the economy?

Done. It’s in the big freezer in my underground bunker, all set to protect me and my picture taking from the guvmint. Right next to the Ben & Jerry’s. My very own ruggedly individual, steel-reinforced free market. :rolleyes:

Unfortunately, the expiry date on ice cream isn't as long. ;)

Prices do not inflate. They go up or down based on supply and demand. They will also be driven higher if inflation drives the money supply higher. The amount of money in circulation inflates or deflates. Prices change normally based on supply and demand. If there is no inflation, no increase in money supply, the price would stay constant all other things remaining equal.

 

What's caused increases in the cost of film and cameras over the years is the debasement of the currency due to printing. Even "target inflation" such as 2% adds up and hurts us. In ten years that debases the currency 20% (10x 2%) So everything in the economy will cost 20% more as an average including film. The high cost of film today has finally caught up to all that 2% inflation over the years. I'd stock up and stuff your freezer as it's going higher.

Ok, just so you know, in a market economy no inflation generally means contraction or no growth and is simply a fantastical myth. Its absolutely normal and necessary. Planet population is growing, economies are growing, as long as those conditions exist, the money supply will expand. As long as salaries and wages keep pace it really doesn't matter to individuals. So if you are expecting $1.00 try-x and $350 Leicas in 2022 dollars and that's what your wishing for. Good luck. In addition you won't have lower film prices when there's just not an expansion of film use. It called scale of economy.

Ok, just so you know, in a market economy no inflation generally means contraction or no growth and is simply a fantastical myth. Its absolutely normal and necessary. Planet population is growing, economies are growing, as long as those conditions exist, the money supply will expand. As long as salaries and wages keep pace it really doesn't matter to individuals. So if you are expecting $1.00 try-x and $350 Leicas in 2022 dollars and that's what your wishing for. Good luck. In addition, you won't have lower film prices when there's just not an expansion of film use. It called scale of economy.

I agree. If productivity goes up due to technology or population increase, a more typical situation in America, then an increase in the money supply makes sense. If the ratio stays the same, prices will remain constant, all other things remaining equal. So maybe a 2% target makes sense. But why not 1% or 3%. Isn;t there a mathematical way of calculating what it should be? Doesn't the Fed have tools to determine an exact amount? The problem could be that the Fed really is stuck with deficit spending by government. In the end, they just have to support government spending which is more than they take in with taxes. So deficit spending drives money-printing instead of productivity and population increases. Of course in Europe, many countries populations are decreasing so their productivity is also decreasing, So inflation is even worse there.

Of course, the particular problem we have today was when Covid hit, productivity decreased substantially as jobs and industries were shut down. However, at the same time, the government printed loads of money to support people. So you had more money chasing fewer goods and the CPI went up currently to 9.1% in America and very close to that in many other places in the world where countries expanding their currencies as well. The problem with wages is they never really catch up with inflation and they always lag the increases in any case. So people's salaries go up, if they're lucky, long after prices have escalated. The other issue that has to be considered is taxes. Those have gone up as well when you consider Social Security, Medicare, state and local taxes, sales, property, etc. in addition to Federal income taxes. So even if salaries have gone up, the extra taxes reduce the net income. Two breadwinner families became common just for people to stay current. So although we live better, we also work a lot harder.

Interestingly, prior to the Federal Reserve being started in 1913, for a few decades when the country was expanding a lot, prices were pretty constant. I'm not familiar with money history, so I don't know how did they adjust the currency in circulation before the Fed with productivity to prevent regular increases in prices? Did "free markets" in currency cause that to happen? It seems things got worse after the Fed was started and never got good again. As we have learned, all that extra money at low-interest rates has raised the value of assets owned mainly by the better-off and left people buying film with less to eat.

https://www.google.com/search?q=the+fed+history&rlz=1C1RXQR_enUS1007US1007&oq=the+fed+history&aqs=chrome..69i57j0i22i30l3j0i390l4.2599j0j7&sourceid=chrome&ie=UTF-8

I'm going to clarify the 2% point. That has to do with prices increasing 2%, not the growth of the money supply is 2%. How does the Fed figure out what they should do to the money supply in any one year? It's like they're looking backward because how do they know what's going to happen to prices next year in the future?

In any case, why have 2%. higher prices every year? That's 20% in ten years. A lot of money lost in your savings account. All you're doing is devaluing currency. The dollar is probably worth 5% of what it was 75 years ago. We should be shooting for 0% change in prices by keeping money and productivity at the same ratio. Capital investment comes from savings not expanding the money supply. That's just a false way of doing it and it's why no one can afford film or anything else today.

I agree. If productivity goes up due to technology or population increase, a more typical situation in America, then an increase in the money supply makes sense. If the ratio stays the same, prices will remain constant, all other things remaining equal. So maybe a 2% target makes sense. But why not 1% or 3%. Isn;t there a mathematical way of calculating what it should be? Doesn't the Fed have tools to determine an exact amount? The problem could be that the Fed really is stuck with deficit spending by government. In the end, they just have to support government spending which is more than they take in with taxes. So deficit spending drives money-printing instead of productivity and population increases. Of course in Europe, many countries populations are decreasing so their productivity is also decreasing, So inflation is even worse there.

 

Of course, the particular problem we have today was when Covid hit, productivity decreased substantially as jobs and industries were shut down. However, at the same time, the government printed loads of money to support people. So you had more money chasing fewer goods and the CPI went up currently to 9.1% in America and very close to that in many other places in the world where countries expanding their currencies as well. The problem with wages is they never really catch up with inflation and they always lag the increases in any case. So people's salaries go up, if they're lucky, long after prices have escalated. The other issue that has to be considered is taxes. Those have gone up as well when you consider Social Security, Medicare, state and local taxes, sales, property, etc. in addition to Federal income taxes. So even if salaries have gone up, the extra taxes reduce the net income. Two breadwinner families became common just for people to stay current. So although we live better, we also work a lot harder.

 

Interestingly, prior to the Federal Reserve being started in 1913, for a few decades when the country was expanding a lot, prices were pretty constant. I'm not familiar with money history, so I don't know how did they adjust the currency in circulation before the Fed with productivity to prevent regular increases in prices? Did "free markets" in currency cause that to happen? It seems things got worse after the Fed was started and never got good again. As we have learned, all that extra money at low-interest rates has raised the value of assets owned mainly by the better-off and left people buying film with less to eat.

the fed history - Google Search

I don't want to get into a big debate about this, but you should know that the Federal Reserve was created in response to the Panic of 1907 when it became apparent that you couldn't count on J.P. Morgan to always come to the rescue when banks went broke due to irresponsible lending or other causes. Central banks help to create a stable financial system that allows businesses and individuals to function securely and to plan for the future without worrying about their money becoming worthless or losing everything when banks fail. Are central banks perfect? Of course not, they are created and run by human beings. But in that golden age that you refer to prior to 1913, there were repeated bank failures and "panics" that caused tremendous hardship for millions of people and many businesses. The Fed has been subject to political influence--cf Arthur Burns and Richard Nixon in the run up to the 1972 election for example. But we are better off with a central bank in this day and age than we would be without it. If you want to know what an unregulated financial system looks like, check out what has happened with crypto currency over the last year. It is a lot like the American banking system of the 19th century.

I don't want to get into a big debate about this, but you should know that the Federal Reserve was created in response to the Panic of 1907 when it became apparent that you couldn't count on J.P. Morgan to always come to the rescue when banks went broke due to irresponsible lending or other causes. Central banks help to create a stable financial system that allows businesses and individuals to function securely and to plan for the future without worrying about their money becoming worthless or losing everything when banks fail. Are central banks perfect? Of course not, they are created and run by human beings. But in that golden age that you refer to prior to 1913, there were repeated bank failures and "panics" that caused tremendous hardship for millions of people and many businesses. The Fed has been subject to political influence--cf Arthur Burns and Richard Nixon in the run up to the 1972 election for example. But we are better off with a central bank in this day and age than we would be without it. If you want to know what an unregulated financial system looks like, check out what has happened with crypto currency over the last year. It is a lot like the American banking system of the 19th century.

The problem is the Fed has become the tool of the politicians supporting deficit spending. They really aren't independent. They also set policies and do business that winds up helping the richer class. Their policies have driven asset values to increase helping the rich while inflation hurts the poor and least wealthy the most. The middle class gets it in the head and pays for both ends. When the Secretary of the Treasury, formerly the Chairman of the Federal Reserve, admits she made a mistake regarding inflation, you've got to wonder who's minding the store and just how screwed we are. Do you really think they care about the price of film. ;)

The problem is the Fed has become the tool of the politicians supporting deficit spending. They really aren't independent. They also set policies and do business that winds up helping the richer class. Their policies have driven asset values to increase helping the rich while inflation hurts the poor and least wealthy the most. The middle class gets it in the head and pays for both ends. When the Secretary of the Treasury, formerly the Chairman of the Federal Reserve, admits she made a mistake regarding inflation, you've got to wonder who's minding the store and just how screwed we are. Do you really think they care about the price of film. ;)

Economics isn't an exact science, however much some of its practitioners would like it to be. Things like COVID and the war in the Ukraine can lead to unpredictable consequences and those in charge have to make their best guess and make decisions. I would agree with you that there has been an asset bubble in the last ten years, but that was less because of politicians wanting the Fed to create it than it was the Fed's response to an inadequate political response to the financial crash of 2008. Had they not done quantitive easing and kept interest rates very low we would have had much higher rates of unemployment that would have had far more detrimental effects on the poor and middle classes. Is inflation bad? Absolutely. Is moderate inflation worse than high unemployment? I don't think so.

As for the price of film, technology and the switch to digital imaging has made film a niche market. When film was dominant, every wide release Hollywood blockbuster of 1000 prints meant that Kodak or Fuji sold 1000 miles or more of film for those prints. The production facilities for that were enormous and incredibly efficient, but those days are over and they aren't coming back no matter how much some of us might like. Small scale production of an industrial product is inevitably more costly. To blame that on the Fed seems a bit disingenuous.

You can't get something for nothing. Printing money (inflation) creates false wealth that eventually leads to a recession to repair the damage. Prices go up and demand drops because of it. Then, companies produce less and lay off employees because they don't need so many to produce less product. Many will go out of business. The middle class is being wiped out dropping from around 65% to 45% of Americans. There ain't no such thing as a free lunch.

As far as film, I agree with you that there are normal supply and demand in a market that affect it;'s price other than inflation. But money printing beyond general productivity of the country also affects everything including film bacuse the value of the currency is watered down. That means you need more currency to buy it and everything else from homes to gas, to cameras to food to medicine, etc.

I'm going to clarify the 2% point. That has to do with prices increasing 2%, not the growth of the money supply is 2%. How does the Fed figure out what they should do to the money supply in any one year? It's like they're looking backward because how do they know what's going to happen to prices next year in the future?

 

In any case, why have 2%. higher prices every year? That's 20% in ten years. A lot of money lost in your savings account. All you're doing is devaluing currency. The dollar is probably worth 5% of what it was 75 years ago. We should be shooting for 0% change in prices by keeping money and productivity at the same ratio. Capital investment comes from savings not expanding the money supply. That's just a false way of doing it and it's why no one can afford film or anything else today.

Read this Alan: https://www.imf.org/external/pubs/ft/issues/issues15/

You're right about losing value in savings accounts. That's why no one has been protecting their savings and assets in savings accounts from like forever ago.

Economics isn't an exact science,

Economics isn't science, period. In any case, we are entering a new phase in economics, thanks to the creation of cryptocurrencies. They won't replace fiat, any more than they will replace stocks or precious metals. But by their nature, their operations are transparent, immutable and decentralised. A perfect antidote to the money printer.

Read this Alan: Economic Issues No. 15 -- Inflation Targeting as a Framework for Monetary Policy

 

You're right about losing value in savings accounts. That's why no one has been protecting their savings and assets in savings accounts from like forever ago.

As a 77-year-old, like other seniors, putting my savings in assets like a stock market, gold, or real estate, is risky. If the market goes down, we may be 95 before it comes back assuming we can live that long. . So we seniors tend to be conservative in our investments and favor straight interest and possibly dividends from reliable companies.. Asset investments are more for the younger. They have the time for markets to return to higher valuations.

It's why the Fed's policy of years of low-interest rates has really hurt the retired a lot. Like every other commodity or product, let the free market decide on interest rates. When the Fed artificially has low rates, they encourage bad investments and too many consumer loans because money is so cheap. Then, as we'll be seeing very shortly, when it hits the fan, all that debt is going to create a recession, layoffs, and bankruptcies galore. Asset valuations will drop like a stone. It's not a good way to run an economy.

Economics isn't science, period. In any case, we are entering a new phase in economics, thanks to the creation of cryptocurrencies. They won't replace fiat, any more than they will replace stocks or precious metals. But by their nature, their operations are transparent, immutable and decentralised. A perfect antidote to the money printer.

Except that politicians won't give up control of a nation's currency. How will they be able to legislate "free stuff" for the public's vote?

Read this Alan: Economic Issues No. 15 -- Inflation Targeting as a Framework for Monetary Policy

 

You're right about losing value in savings accounts. That's why no one has been protecting their savings and assets in savings accounts from like forever ago.

Barry, I started to read the article that explains how a country can target inflation. I stopped when I realized that the two requirements they listed for it to work are not being met in the US.

The article states that the central bank must not be influenced by fiscal spending or by employment figures. Regarding the latter, that's one of the requirements that Congress has put on the Fed. That they have to consider employment figures in adjusting interest rates for example to boost the economy to provide jobs. Of course, fiscal spending creates a second defect for inflation targeting because the Fed monetizes spending and debt created by congress's deficit spending. When taxes and loans in the form of bonds don't cover spending, the Fed prints. That inflation affects prices and asset valuations. So there can't be any discipline to target inflation.

Despite the Fed's claim to independence, their actual work reflects much of the desires of politicians. Let's face it. Powell likes his job and presidents and politicians don't like to see inflation and higher prices right before an election. We'll see if he holds to higher interest rates or will fold. Where is Paul Volker when we need him?

It may be true that the cost of circuits has gone down. But you're not computing into that reduction how much in taxes and inflated costs due to deficit spending that cost.

OK. Let's do the arithmetic. According to an article in the IEEE Spectrum, in the first half of the 1960s, a single transistor cost roughly $8 in current dollars, that is, after taking inflation into account. In the chip I mentioned, the retail price of a single transistor is $400/1,000,000,000. A transistor in the 1960s cost 2.5 million times as much as it does today. And there are now many trillions of transistors being produced and purchased every year.

Your posts treat the economy as if only a single factor matters: money supply.

Economics isn't science, period. In any case, we are entering a new phase in economics, thanks to the creation of cryptocurrencies. They won't replace fiat, any more than they will replace stocks or precious metals. But by their nature, their operations are transparent, immutable and decentralised. A perfect antidote to the money printer.

Economics is a social science, like sociology. Occasionally you get a "natural experiment" where similar states or countries enact different policies to deal with the same problem and one can then judge which was more successful over time. Usually, however, economists come up with theories (hopefully fact based rather than solely ideological) and persuade politicians to try them. Success is frequently in the eye of the beholder.

Your faith in cryptocurrencies is touching but reality hasn't worked that way. Crypto looks a lot more like a Ponzi scheme than a currency. Lots of crypto entities have disappeared into bankruptcy and more will follow over time, as it becomes more apparent that this is a highly speculative, unregulated market with no protection for average investors. There is also the environmental cost of "bitcoin mining"--crypto is using more electricity than many whole countries, frequently in the US from coal fired power plants that would otherwise have been decommissioned. At least when people in the Netherlands were "investing" in tulip bulbs they got beautiful flowers in the spring.

Your faith in cryptocurrencies is touching but reality hasn't worked that way. Crypto looks a lot more like a Ponzi scheme than a currency. Lots of crypto entities have disappeared into bankruptcy and more will follow over time, as it becomes more apparent that this is a highly speculative, unregulated market with no protection for average investors. There is also the environmental cost of "bitcoin mining"--crypto is using more electricity than many whole countries, frequently in the US from coal fired power plants that would otherwise have been decommissioned. At least when people in the Netherlands were "investing" in tulip bulbs they got beautiful flowers in the spring.

I agree, but I think it's a pyramid scheme, not a Ponzi scheme, not that this makes any difference. It's nonetheless the greater-fool approach.

The environmental costs are appalling. One logical answer, if countries could agree, would be to place an enormous tax on crypto mining and another on crypto transactions. At least the Dutch speculators were risking only their own well-being. Crypto miners are contributing substantially to one of the greatest crises humankind has ever faced.

Except that politicians won't give up control of a nation's currency. How will they be able to legislate "free stuff" for the public's vote?

Crypto, never mind precious metals, are measured in US dollars. Even "enlightened" nations, which use the metric system almost exclusively, measure gold's value in USD/oz. A former American President said, "I like the US dollar." Well, guess what? So does almost everyone who owns precious metals or crypto.

Your faith in cryptocurrencies is touching but reality hasn't worked that way. Crypto looks a lot more like a Ponzi scheme than a currency. Lots of crypto entities have disappeared into bankruptcy and more will follow over time, as it becomes more apparent that this is a highly speculative, unregulated market with no protection for average investors. There is also the environmental cost of "bitcoin mining"--crypto is using more electricity than many whole countries, frequently in the US from coal fired power plants that would otherwise have been decommissioned. At least when people in the Netherlands were "investing" in tulip bulbs they got beautiful flowers in the spring.

If crypto is a Ponzi or pyramid scheme, then so too is art, or precious metals, or classic cars. Crypto is a nascent asset class and regulation is evolving.

The most expensive camera ever sold at auction was a Leica 0-Series prototype, owned by Oskar Barnack himself. It sold for over $14M. If I had that kind of money, would I buy it? No. Does it have utility that is matched by its price? Nah. But it has an open market price, just like gold or Bitcoin or impressionist paintings.

Bitcoin mining uses less electricity than the banking networks. Nobody cares about how much electricity Bitcoin uses as long as miners pay their bills. A lot of that electricity is generated by "renewable" sources. Not that this matters. Some cryptos use very little electricity at all. It depends on the consensus mechanism.

Photographic film also has a supposed environmental impact, but nobody demonises it. Used developers can be safely tipped into the sink if done appropriately.

Of course many crypto related entities will go bankrupt. That's what happened after the dot-com bubble burst. And yet life goes on. Apple is worth $2.6T, Oracle is worth $200B, Cisco is worth $185B, Google is worth $1.5T, and Amazon is worth $1.4T.

All of crypto is worth $1.57T, about the same as either of the latter two corporations. Eventually, Bitcoin by itself will flip gold, which is currently about $11.7T. Nobody thought that digital would or could be anywhere near as good as film. Maybe up until ten years ago I would have said that, too. I guess we know what happened with that prediction.

The environmental costs are appalling. One logical answer, if countries could agree, would be to place an enormous tax on crypto mining and another on crypto transactions. At least the Dutch speculators were risking only their own well-being. Crypto miners are contributing substantially to one of the greatest crises humankind has ever faced.

The environment isn't paying the bills - the miners are. And there already is a huge tax on electricity in some nations like Germany. That's what happens when you go "green."

FWIW, sociology isn't a science either. That doesn't mean it's less valuable - after all, law medicine, history, and other subjects, are not sciences. Perhaps I'll concede that 'social science' is a term of convenience.

I acknowledge that this thread is going a little off-topic. Are the moderators okay with it so far?

IMG_1307 by Karim Ghantous, on Flickr

 

Are you joking? Except for recent losses, 401 K and other retirement accounts, even when very conservative have been amazing since recovery from the housing collapse. I don't know how you are reaching your conclusions but the retired have done quite well unless they kept their savings in a shoebox.

The environment isn't paying the bills - the miners are.

Nonsense. Look up "externality". The biggest cost of energy consumption, environmental damage, is mostly externalized at this time. The point of a high tax would be to force the miners to internalize currently externalized costs. if that were done to a sufficient degree, the whole problem would disappear.

They're "mining" for a product of 1s and 0s that has no shape or weight, no substance. Then claiming it's worth $20K or so. Amazing.

Indeed. What's yet more amazing is that there are people who actually argue that this is an "investment" rather than simple greater-fool speculation.

There are lots of investments that have ridiculous prices relative to their fundamental values--sometimes because of hope for future growth of the company, sometimes just speculation that other people will want to buy and jack the price up, sometimes FOMO (fear of missing out), and sometimes all of these. But at least there is something there. A good example is Tesla stock, which has a price:earnings ratio of 107 currently--3 or 4 times the red-flag level. (By way of comparison, VW, which already beats Tesla in EV sales in Europe and which Bloomberg predicts will pass Tesla world-wide within 3 years, has a PE ratio of roughly 6. Ford, which can't come close to keeping up with demand for its two first EVs, the Mustang and F-150, has a PE of 5.) Maybe future growth will justify this, but if not (my hunch), at least what's left is a large and successful car and manufacturer, the value of which would be very large even after the bubble burst. In the case of cryptocurrency, or more ludicrous yet, NFTs, what would be left is nothing whatsoever.

Crypto, never mind precious metals, are measured in US dollars. Even "enlightened" nations, which use the metric system almost exclusively, measure gold's value in USD/oz. A former American President said, "I like the US dollar." Well, guess what? So does almost everyone who owns precious metals or crypto.

 

 

If crypto is a Ponzi or pyramid scheme, then so too is art, or precious metals, or classic cars. Crypto is a nascent asset class and regulation is evolving.

 

The most expensive camera ever sold at auction was a Leica 0-Series prototype, owned by Oskar Barnack himself. It sold for over $14M. If I had that kind of money, would I buy it? No. Does it have utility that is matched by its price? Nah. But it has an open market price, just like gold or Bitcoin or impressionist paintings.

 

Bitcoin mining uses less electricity than the banking networks. Nobody cares about how much electricity Bitcoin uses as long as miners pay their bills. A lot of that electricity is generated by "renewable" sources. Not that this matters. Some cryptos use very little electricity at all. It depends on the consensus mechanism.

 

Photographic film also has a supposed environmental impact, but nobody demonises it. Used developers can be safely tipped into the sink if done appropriately.

 

Of course many crypto related entities will go bankrupt. That's what happened after the dot-com bubble burst. And yet life goes on. Apple is worth $2.6T, Oracle is worth $200B, Cisco is worth $185B, Google is worth $1.5T, and Amazon is worth $1.4T.

 

All of crypto is worth $1.57T, about the same as either of the latter two corporations. Eventually, Bitcoin by itself will flip gold, which is currently about $11.7T. Nobody thought that digital would or could be anywhere near as good as film. Maybe up until ten years ago I would have said that, too. I guess we know what happened with that prediction.

 

 

The environment isn't paying the bills - the miners are. And there already is a huge tax on electricity in some nations like Germany. That's what happens when you go "green."

 

FWIW, sociology isn't a science either. That doesn't mean it's less valuable - after all, law medicine, history, and other subjects, are not sciences. Perhaps I'll concede that 'social science' is a term of convenience.

 

I acknowledge that this thread is going a little off-topic. Are the moderators okay with it so far?

 

IMG_1307 by Karim Ghantous, on Flickr

Two points:

1) Auction fever seems to be a common human trait, as is FOMO as referenced by Paddler4. Whether it is a camera, a painting or bitcoin, not every person's actions will be reasonable, and people can be easily be misled by promises of quick riches or an enormous psychic payoff. The fact that bitcoin and others are denominated in dollars tells you that it isn't a currency in the normally accepted sense of the word.

2) Gold has actual practical use in industrial processes, jewelry and other products. Many cameras from the last 40 years have gold plated contacts for batteries, for example, since gold doesn't tarnish. Crypto seems to be primarily useful for its marketers and for facilitating criminal transactions. Gold as an investment has often proven to be a poor one--there are high transaction costs and storage fees that can wipe out a lot of the profit even in a rising market. But it will still hold some value since it has practical uses.

Two points:

 

1) [...] The fact that bitcoin and others are denominated in dollars tells you that it isn't a currency in the normally accepted sense of the word.

What's more: cryptocurrencies aren't denominated in US Dollars.

Maybe in the U.S. people like to know how much in their local currency they would have to pay for one, say, Bitcoin. But elsewhere noone cares about that, and people are more interested in knowing the rate in their local currency.

Cryptocurrencies are make-believe money. As long as enough people believe that they have some value, they will. There is nothing else but that belief behind them, though.

What's more: cryptocurrencies aren't denominated in US Dollars.

They effectively are. When we record all-time highs, for example, we all refer to them in USD. We don't refer to Pounds Sterling or Yen or Euro. Just like English is the lingua franca, the USD is the 'valuta franca'.

Crypto, never mind precious metals, are measured in US dollars. Even "enlightened" nations, which use the metric system almost exclusively, measure gold's value in USD/oz. A former American President said, "I like the US dollar." Well, guess what? So does almost everyone who owns precious metals or crypto.

 

 

If crypto is a Ponzi or pyramid scheme, then so too is art, or precious metals, or classic cars. Crypto is a nascent asset class and regulation is evolving.

 

The most expensive camera ever sold at auction was a Leica 0-Series prototype, owned by Oskar Barnack himself. It sold for over $14M. If I had that kind of money, would I buy it? No. Does it have utility that is matched by its price? Nah. But it has an open market price, just like gold or Bitcoin or impressionist paintings.

 

Bitcoin mining uses less electricity than the banking networks. Nobody cares about how much electricity Bitcoin uses as long as miners pay their bills. A lot of that electricity is generated by "renewable" sources. Not that this matters. Some cryptos use very little electricity at all. It depends on the consensus mechanism.

 

Photographic film also has a supposed environmental impact, but nobody demonises it. Used developers can be safely tipped into the sink if done appropriately.

 

Of course many crypto related entities will go bankrupt. That's what happened after the dot-com bubble burst. And yet life goes on. Apple is worth $2.6T, Oracle is worth $200B, Cisco is worth $185B, Google is worth $1.5T, and Amazon is worth $1.4T.

 

All of crypto is worth $1.57T, about the same as either of the latter two corporations. Eventually, Bitcoin by itself will flip gold, which is currently about $11.7T. Nobody thought that digital would or could be anywhere near as good as film. Maybe up until ten years ago I would have said that, too. I guess we know what happened with that prediction.

 

 

The environment isn't paying the bills - the miners are. And there already is a huge tax on electricity in some nations like Germany. That's what happens when you go "green."

 

FWIW, sociology isn't a science either. That doesn't mean it's less valuable - after all, law medicine, history, and other subjects, are not sciences. Perhaps I'll concede that 'social science' is a term of convenience.

 

I acknowledge that this thread is going a little off-topic. Are the moderators okay with it so far?

How can you compare a corporation like Apple or Amazon to crypto? The corporations own wealth in the forms of buildings, trucks, airplanes, patents, copyrights, factories, intellectual property in the form of engineers and employees, cash in the bank, dividends, etc. The only thing going for crypto is the hope you can find someone else willing to pay you more for your crypto than you paid for it.