FuckyWucky [none/use name]

Bitcoin is not different from the USD fiscal policy space wise. You use USD (which you obtain from trade, remitances, loans and capital inflows) to buy Bitcoin or use the same USD to buy ASICs to mine Bitcoin with. In the end you hope to sell it to someone else to get more USD than you started with.

Even if it’s not for conversion then would the population like to use a system where there is no physical cash form of bitcoin (El Salvador has large informal economy) fully dependent on internet, electricity and a smartphone. Would the Government make budget denominated in bitcoin? How will all the pricing be done? Why should El Salvador go through all these complications instead of adopting its own currency where it’ll have more fiscal space?

Bitcoin was never widely used in El Salvador outside small transfer payments which would’ve been converted to Dollars pretty quick anyways.

Having your own currency gives you power to manipulate exchange rate and employ domestic resources instead of having to borrow continously from the IMF.

Not saying that a sovereign currency alone is enough. Countries may not be able to enforce taxes enough or try pegging rates to the Dollar to prevent pass-through inflation and balance of payments issues. But it is a necessity.

All payments to the US Government, fees, fines and taxes.

Yes and every time they create dollars there is a corresponding liability at the fed.

I suggest this book

I think that’s why El Salvador is dropping it. They never really forced people to use Bitcoin, US Dollar was also the legal tender and unlike Bitcoin, also the money of account.

But really though, can you call for IMF to stop lending to countries which buy Bitcoin using state funds when the issuer of Dollars, the U.S. has a President who has run multiple crypto/NFT scams and wants to use Government money to pump up crypto prices?

Not really what I said. I said gold and all the commodities are denominated in Dollars.

You hold gold because you hope to sell it at a future date for more dollars. You hope China doesn’t find more gold or some country decides to release gold locked in vaults. In the end you want more dollars than you started with.

Same with bitcoin which is going up in price because of a flood of Dollars from ETFs and due to Trump’s potential policies. You want bitcoin to go up in price so you can sell it for more dollars.

Another thing to keep in mind is that Bitcoin has characteristics of a real asset, not a financial asset.

Dollars, you can give to the US Government for payment of taxes etc. There is a corrosponding liability at the Fed. That is not the case with “real” assets like Bitcoin, there is no corrosponding liability.

They make no money from the investment you mentioned unless they sell for Dollars. Your stock portfolio gets you no money in form of capital gains unless you liquidate it for Dollars. Same with gold.

Is El Salvador budget denominated in gold or bitcoin? No, it’s denominated in Dollars.

El Salvador should first stop using a foreign currency, the dollar. Then worry about trying to attract capital inflows.

Sovereigns aren’t the same as individuals. For sovereign, at the macro level, spending drives consumption and creates employment of real resources.

If El Salvador had its own currency, they could tax and spend that instead. But no, they use US Dollars.

Ok, can they sell it then? What’s the use of Bitcoin? Why are you valuing it in Dollars? Countries accumulate Dollars and other first world currencies to be able to import more (and in case of El Salvador, spend more domestically). Bitcoin is sitting there doing nothing.

Same applies to massive foreign exchange reserves like in the case of China. But still, atleast forex reserves can be quickly used to stabilize the exchange rates.

Also keep in mind even if they sell it and assuming there is enough liquidity, $300m one time isn’t a lot of money even for a country like El Salvador.

If he were smart, he would bring back the Colon and stop using US Dollars. But noo he had to do stupid shit like Bitcoin.

When Dollar is replaced as the reserve currency, America’s imports will shrink and there may be inflation. But it won’t result it in defaulting on its domestic currency.

Any austerity on the US will be self-inflicted (as it is in the UK and Europe). The unwillingness of the US Government to take over the economy from the parasites will make things much worse.

They did that once to Australia.

To be sure, consumers would benefit from lower-priced goods. But persistent economy-wide deflation can also trigger a vicious cycle of lower spending and investment, leading to even weaker growth and higher unemployment.

Unless countered by increased Government spending, they have implemented some stimulus measures but I hope they go for more.

Central Government can always unconditionally invest and spend without caring about turning money into more money.

Its why real wages and unemployment are better measures than solely looking at prices.

Capitalist magazines can’t imagine Government doing stuff other than weapons for genocide or bank bailouts.

That and reduce working hours. Also provide everyone with a job they can fall back on, provided by the state.

“liberation” i dont think its liberation to have bread prices rise by 900%.

It could be considered “fine” if it were only temporary but most likely their real incomes will continue to stagnate for years, decades.

There won’t be any significant recovery. Israel and Turkey are taking their territory, reducing their real resources. The state is completely non-functional and cannot mobilize whatever local resources are available.

Market expectations for the next BOJ rate hike have fluctuated between December and January.

No fucking way they want to hike rates in 2025?

Chinese authorities are demanding wealthy individuals and companies double-check their taxes for unpaid liabilities in a move that threatens to further dent investor confidence in the world’s second-largest economy.

If rich people can’t pay taxes, they shouldn’t be investing.

“China’s fiscal deficits have reached a tipping point,” said Gary Ng, a senior economist at Natixis. “There is more urgency to find alternative revenue sources . . . and taxing the wealthy and some companies creates a less direct economic impact on most residents.”

Economists should be sent to Mars tbh

The profits being made on those assets aren’t being kept for Russia to use in the future. They’re now being used to fund Ukraine

Rachel, Where do “profits” on these assets come from? These aren’t corporate bonds but Government bonds. The Governments (US, UK and others) are paying the defence contractors using public money.

If there were no Russian foreign reserves being stolen, would the west not have sent weapons to Ukraine? Of course not! The weapons manufacturers have to make profits, it would come out of a different Government account.

They are making excuses to make it look like the public isn’t paying for it.

Telegram is like CSAM and Nazi Central tbf. The place needs a purge, sucks that it’s capitalist states doing it, they will go after leftists too…

British media are such cucks. They call him “Lord” Cameron.

Voter turnout was 76%, with 3,499 people voting against the plans, 1,882 in favour.

God damn, use % for ffs. 65% voted against, 35% voted for it

What makes a ‘country’ is and itself very complicated. I do not believe Israel would want diplomatic relations with countries which sanction it.

ISIS was a ‘state’ at its peak and held control over territories but no one else had any formal diplomatic ties with them because everyone rightfully recognized them as an unlawful terrorist state. Is Israel really that different? Israel has shown blatant disregard for any peace plans whether its 1967 or Oslo. There are good reasons to not recognize Israel even though it holds territory.

Also, just because two countries have no formal diplomatic relations doesn’t mean they can’t have interactions. Look at USSR and Israel in this example

https://en.wikipedia.org/wiki/1988_Ordzhonikidze_bus_hijacking

They were extradited to the Soviet Union and sentenced to prison terms, although at that time Israel and the Soviet Union had no extradition treaty as relations were still severed at the time. All hostages were released.