Okay... I still don't know what it means to "apply MMT". I already told you that monetary policy has been used by governments since the 1930s long before MMT was invented. But, anyway, what is your point? Do you think that QE was a mistake? What do you suggest would have been an appropriate monetary policy during the 2008 financial crisis?
Given inflation didn't run rampant, I don't know if there was a better strategy.
However, the continued liberal application of QE 1. Could hit a hyper inflation ceiling (hurting the poorest). 2. Weakens USD compared to other currencies (as we have seen through 2020. Hurting every entity that holds cash i.e. typically the poorest). 3. Reduces the ability for the US to apply QE in the future. Hurting our ability to tackle the next crisis, which will predominantly hurt the poorest.
All of this to say, a portion of the lost trust in the USD is being put into crypto to hedge for the medium term, and (for better or worse) to create a long term denationalized currency where no handful of politicians can choose to use QE rather than making good fiscal policy decisions quickly.
So when the next economic crisis comes you would rather have central banks not interfere with the crisis at all. Just let the crisis solve itself. Is that what you're saying? Also, you seem to think that taking monetary policy away from central banks will lead somehow to governments making good fiscal policy decisions, whatever that is. Where do you get that from? The gold standard never stopped governments from going bankrupt. Monetary policy in the hands of incompetent authorities can be disastrous, but this is no reason to get rid of it. Otherwise we should also get rid of many things, including laws and government.
I'm not making a judgement about its merits, it might end up horrible.
All I'm saying is, there is a trend towards denationalized currency as a hedge against bad monetary policy. Based on this trend something like BTC will likely become the new gold standard used for slow transactions (i.e. reconciliation) between governments and large corporations.
Will it be BTC? I don't know. Will it be a good thing? I don't know.
I do know, the trend suggests a particular future, and trying to root out the motivations suggest the trend will continue.
People who believe removing power from central banks is a good way of avoiding bad monetary policy are a tiny minority of lunatics. This will never be the motivation behind a widespread adoption of a bitcoin by governments, corporations and the general public.
By your definition from earlier in the thread, any entity that buys BTC is a lunatic, so I'm not sure you'll have much to learn from this :P
But, if you are willing to acknowledge both Square and Tesla are run by very intelligent people, these are quotes about their motivations:
> However, when fiat currency has negative real interest, only a fool wouldn’t look elsewhere. [0]
> Square believes that cryptocurrency ... provides a way for the world to participate in a global monetary system, which aligns with the company’s purpose. [1]
Based on my research into the motivations for BTC (or any crypto), these quotes are not unique. The majority of the root motivations seem to be 1. "to hedge against bad monetary policy" and 2. "to create a global monetary system" i.e. create a single global monetary policy.
Meanwhile, if enough S&P companies follow Square and Tesla the US government will find BTC is "too big to fail" and adopt it wholly. But I'm not convinced other S&P companies will follow. Lets see.
The anti-government, anti-bank ideology behind the creation of bitcoin and other crypto-currencies is indeed a bizarre political cult whose adherents are definitely lunatics. That doesn't mean everybody who owns bitcoin is necessarily a lunatic. What is true though is that, generally speaking, proponents of bitcoin don't seem to really grasp basic economic concepts. For example, what does it mean for a fiat currency to have "negative real interest" rate? Currencies don't "have" real interest rates. Real interest rates are not set by governments nor central banks, but by the market, and they are independent from currency (that's what "real", as opposed to nominal, means). At least Musk is decent enough to admit he doesn't know what he's talking about, which is good. Bitcoin is a non-income generating asset, which means the only way it can produce a positive return is if it increases in price, and it can only increase in price if the demand for it grows. Therefore I'd be a little sceptic about opinions put forth by people who are invested in bitcoin, as they have a strong financial interest in promoting bitcoin in order to make its price rise, as this is the only way they can safeguard their investment. If I were you, I'd look elsewhere for opinions on this matter.
