Jul 12, 2019
Cars, Gold, Houses, Toys & Stock: What gives value?
Posted by Philip Raymond in categories: bitcoin, cryptocurrencies, economics
The title of this post is intentionally misleading. We frequently discuss the traits that lead to value here in the Lifeboat Blog. But today, I was asked a more nuanced question: “What things will hold their value?”
And there is a ulterior motive in being a columnist for Lifeboat. Analyzing the dynamics of durable value leads to some surprising conclusions about the money supply and what a society chooses to use as money. We’ll get to this at end of this post.
We know that value comes from supply and demand. There are no exceptions. But, we have not addressed the properties that make an asset hold value over the long haul. Let’s consider some examples…
Cars
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But the transaction units will continue to grow as needed, because the pie is divisible into very, very tiny units:
