If you don’t want to lose more brain cells than a lifelong Mike Tyson sparring partner, then I warn you not to watch that video.
It is basically two manifest morons who know nothing about economics or cryptocurrencies trying to use big words, bow ties and act like they know something about economics and cryptocurrencies.
The first thing Stiglitz said was, “One of the main functions of government is to create currency.”
Yes, he is already in the wrong starting with the opening sentence. Governments rarely create currency… that is usually done by the central banks.
But government did not invent money or currency. And it is not government’s role to issue it or regulate it. The market invented money as a way to solve the barter problem.
Just like the market created bitcoin in order to get around the fraudulent monetary system, which the government took over as a scheme… another way to tax us… a way to shuffle wealth and investment to Wall Street… a way for the banks to expand their assets… a way for the military industrial complex to advance its goals. The elastic dollar can be stretched in these ways.
That aside, there is no legitimate function of government. Government is an illicit criminal organization that extorts groups of people in a certain geographical area.
In any case, Stiglitz was obviously told by his handlers what his role was in this interview as he barely got in two sentences before stating that bitcoin should be outlawed!
As I mentioned earlier, Stiglitz has never seen anything in which using government violence isn’t the answer… and that’s why he was given the Nobel prize and why he is featured on the television mind programming regularly.
And, why should it be outlawed? According to Stiglitz, bitcoin should be outlawed because it doesn’t serve any “useful social functions.”
But that’s like saying money serves none either.
He doesn’t understand the value of decentralization because he sees the market as the root of all evil and like all Marxists believes it is unstable and needs regulating.
Which is interesting because then this interview between two morons took a turn into the bizarre.
Considering that Stiglitz is essentially a Marxist, Tom Keene, the Bloomberg host, then attacked bitcoin saying investors are relying on Marx’s “theory of value” and going back to “middle Marxian” theories to determine bitcoin’s value.
What Marx was getting at with that term is that exchange value is an “objective” value, like a money price, which can be different than its actual underlying use value, usually because of speculators and capitalist exploitation. He tended to explain away this “exchange value” as notional and as a reason to suppress trade and exchange.
The host interviewing Stiglitz did not seem to be able to distinguish between that and the subjective value theory of goods that was contributed to economics by Menger, Mises, and the Austrian School. Marx believed that all the value belonged to labor and that value itself owed to labor, that it derived from labor, which came from the erroneous classical school view that value derived from the costs that go into production.
So it was somewhat ironic that the Marxian host questioned a neo-classical economist about why the free market was adopting a Marxian theory, when in fact it is actually adopting the subjective theory of value that neither a Marxian nor Classical economist would ever understand, but which has come to dominate economic thinking in the modern day.
In this theory, value and exchange value are synonymous, and not Marxian in that value is derived from the utility of the good to its consumers and users, and not according to costs or how much labor went into its creation.
But money is a different good altogether, which neither Marx nor the Classical school understood at all. It is the only good whose value does not rely solely on its utility to consumers or capital, but whose value relies on the fact that it already has a price.
The service that money provides is as a store of purchasing power (not wealth), and its value relies on what other goods it can buy.
The guy in the video was basically trying to say that exchange value meant that bitcoin had no real value, and relied on the greater fool theory, which is a crude and bad understanding of how money does increase in value, and why.
In the case of bitcoin, what the free market is actually adopting is the subjective value theory.
And so, to summarize.
Stiglitz incorrectly believes government’s role is to issue currency. Therefore, he thinks government should use violence to “outlaw” bitcoin. And, the two buffoons think that the reason bitcoin is trading at such high levels is because investors are relying on Marxist theories, when, in fact, they are the Marxists and bitcoin investors are relying on Austrian, free market, subjective value theory.
In other words, the entire interview was misinformation, wrong assumptions and calling for acts of violence against computer code and those who believe it has value.
These guys don’t even know what they are talking about, but if you were to have listened to them over the last few years, you would have missed out on the biggest investment returns in the history of the world.
Hopefully, you are smart and just use your TV as a computer monitor now to access things like The Dollar Vigilante and only watch propaganda like Bloomberg or CNBC solely for a good laugh.
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