The principles of why Bitcoin was designed in such a way have all been covered in the previous sections. We discussed money and why gold won out through monetary darwinism. We discussed the fundamental flaw with gold that led to its capture and exploitation by government. We discussed economics and why a global economy on …
4.1 – Bitcoin Origins: The Architect and the Principles of its Design Read More »
Inflation, a term often heard yet seldom fully understood, is an economic phenomenon that impacts virtually every facet of our lives. It affects our purchasing power, the value of our savings, and even our economic outlook. But what is inflation, really, and how does it occur? Let’s dive into a comprehensive analysis of inflation from …
3.4 Inflation: Navigating its Disastrous Consequences Read More »
The Water-Diamond Paradox, a cornerstone of economic thought, questions how two goods with vastly different utilities can have such contrasting values. The paradox highlights the conundrum of a diamond, a luxury item with limited practical use, commanding a high price, while water, essential for life, is relatively inexpensive. If utility is the only thing relevant to …
3.3 Unlocking The Mysteries of Value: The Water-Diamond Paradox Read More »
Austrian economics is a school of economic thought that emphasizes the importance of individual action, market processes, and subjective value.1 At the heart of this approach lies the idea that prices are not determined by objective costs, but rather by the subjective valuations of buyers and sellers in a given market.2 In this article, we …
3.2 Exploring the Distinctions between Cost, Price and Value Read More »
Economics is widely considered by the public as a pseudo-science. I remember even the very little high-school level economics I was taught made little sense. On top of that, I had never witnessed a field of academics where the experts got it so reliably wrong. More often than not, economists would alter their theory to …
3.1 Fundamentals of Austrian Economics: Exploring the Principle of Scarcity Read More »
The global financial crisis (GFC) of 2007-2008, considered the most severe economic downturn since the Great Depression, left lasting impacts on the world economy, exposing the vulnerabilities inherent in the existing financial system.1 At the heart of the GFC was the petrodollar system, which links global trade to the US dollar and perpetuates a debt-based …
2.6 From GFC Lessons to a Bitcoin Alternative: Reinventing Global Finance Read More »
In the mid-20th century, the world economy witnessed the rise of a new monetary system that would transform the global landscape for decades to come. This system, known as the petrodollar, emerged from the ashes of the gold standard, and its influence has been felt far and wide ever since. A powerful tool for the …
2.5 The Power of the Petrodollar: Transforming Middle Eastern Conflicts Read More »
The Bretton Woods system, which came into effect in 1944, was a landmark agreement that established the rules for international monetary and financial relations. It was based on the US dollar’s convertibility into gold at a fixed rate of $35 per ounce, with other currencies pegged to the dollar.1 The system worked well for a while, …
After World War II, the global economy was in shambles, with Europe and Asia left in ruins, and widespread economic instability was rampant. Inflation, currency instability, and trade barriers plagued the world economy, which was a common theme after all wars. The United States, however, emerged from the war as the largest economy and a …
2.3 The Bretton Woods System and the Rise of the US Dollar Read More »
Aftermath After World War I, the global economy was marked by unprecedented devastation, particularly in Europe, where countries were left in ruins, and poverty was widespread. Currencies were significantly devalued, and the Allied forces borrowed a significant amount of money from the US. Normally, during times of war, debts incurred among allies were forgiven. However, …