Just as the internet needed web browsers before it could really change the world, Bitcoin needed user-friendly interfaces to grow beyond money and towards being the base layer—the “rails”—for decentralized services built on Bitcoin alone.
An unbanked population, an economy dependent on remittances, and dollarization. These combine to make El Salvador a perfect case study for bitcoinization.
Although it conjures up scary imagery, shadow banking is simply a term for banking operations that occur through financial intermediaries that are not traditional commercial banks.
Unlike the ongoing price inflation that is typically caused by central-bank expansion of the money supply, the price inflation generated by diminished supplies of goods is a one-shot affair.
So the government is concerned about rough debt-collection tactics? Try skipping out on your taxes this year and see how rough the tactics can become.
Governments always justify printing more money with the excuse that there is no inflation. When inflation rises, they say it is transitory. And when inflation soars, governments blame businesses and shop owners, presenting themselves as the solution with “price controls.”
Seemingly endless amounts of fiscal and monetary stimulus will keep prices rising in the near term. But if the banking sector and other bubble industries weaken, we will eventually see deflation as new loan activity lessens.
Governments always justify printing more money with the excuse that there is no inflation. When inflation rises, they say it is transitory. And when inflation soars, governments blame businesses and shop owners, presenting themselves as the solution with “price controls.”
There is nothing new in a fiat-money central bank imposing an effective tax on the public’s holdings of government debt by manipulating interest rates. But few thought it could go on this long.
Seemingly endless amounts of fiscal and monetary stimulus will keep prices rising in the near term. But if the banking sector and other bubble industries weaken, we will eventually see deflation as new loan activity lessens.
