One particular YouTube video perfectly sums up how the economy works. And if it doesn’t make you want to buy bitcoins (or wish you had more), then perhaps nothing will.
Also read: Leading Dark Net Markets to Support Monero
Economic Stimulus 101
In simple, easy to understand language, this video – which is just over one minute in length – gives a simple economics 101 lesson on how economic stimulus works; on the different schools of thoughts; and on when – and if – state intervention in the economy is necessary. Warning: the video might not leaving you feeling any better off about the economy than before.
As the video goes:
“Central banks can try to stimulate the economy. Central banks do it by lowering interest rates in order to make it cheaper to borrow money, on one hand, and on the other hand they can even inject money directly into the system through monetary easing [. . .] The main question is, ‘Should they?’”
The video goes on to explain the positions of two opposing camps of economic thought: the Keynesians and Austrians.
Keynesian economists believe that central bank and government intervention can push a struggling economy into a real recovery, while Austrians believe that such intervention does more harm than good.
“Quite frankly,” the video says, “economists don’t yet know what needs to be done after a crisis.”
The Siliver Lining of the Financial Crisis
Bitcoin, according to many proponents, was created in part as a solution to the uncertain mechanisms of the US and global economy. It’s deflationary protocol ensures that, instead of losing value over time like many fiat currencies, Bitcoin increases in value over time as fewer coins are mined each block over decades. The fungible nature of Bitcoin allows users to easily trade bitcoins for goods and services.
There are many nuances about how the global economy truly works. One of the most fascinating aspects of the global economics has been Bitcoin in recent years, and in many ways the digital currency – which was created in 2008 by Satoshi Nakamoto – was created as a response to the problem described in this video.
In the 2016 election, Bitcoin has played a role, as Gary Johnson accepts Bitcoin on his campaign website, thus betokening the positive impact Bitcoin could have on everyday life.
Is Bitcoin the next phase in the evolution of money? Let us know in the comments below.
Images courtesy of balancedis.com
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