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Author Topic: Bitcoin, debt as deep as the banks couldn't have imagined.  (Read 5410 times)
Hunterbunter
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February 07, 2012, 04:23:22 AM
 #41

I wonder what would happen to the world if borrowing currency became illegal. Not just no interest on loans, but no loans on currency to begin with.

That is, you only have what people give you, or you create yourself (through labor) -

Would it improve human relationships?

Would it destroy the idea of raising capital?

Would it kill millions of people?
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February 07, 2012, 06:34:31 PM
 #42

I wonder what would happen to the world if borrowing currency became illegal. Not just no interest on loans, but no loans on currency to begin with.

That is, you only have what people give you, or you create yourself (through labor) -

Would it improve human relationships?

Doubt it. Instead of people saying "you owe me money for this loan," they would say "you owe me money for this job."People would still have issues to complain about.

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Would it destroy the idea of raising capital?

Investment capital is at most an unsecured loan (nothing is put up against the loan, like a car or a house, so if it fails, you get nothing).  In this case it would depend on how broadly you define "loan." If unsecured loans with no guarantees of repayments are ok, venture capital will still be ok. However, since credit cards are also unsecured loans...


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Would it kill millions of people?

Only in so much as it will severely stifle and slow down economic and scientific development. People will keep dying because new medicines, and new technologies for water filtration, food, housing, and communication will take longer to get invented, built, and delivered. If I come up with a new water filtration system, and can sell it for a 20% profit, my options are:
Take out a multi million dollar loan to set up a factory to produce them by the thousands, then pay off the loan over five to ten years, keep a few $100k profit for myself, and use that money on some other invention, OR
Not having access to loans, make the filters in mygarage one at a time, save up the %20 profits for many years, and maybe afer many many years be able to afford  a factory to make them, but by then either someone else will have invented a better filter, or the customer base would have died off due to bad water.

Bottom line is, loans are a good thing. Irresponsible people who take out loans they can't afford, and who take on loans without even taking the time to understand finances, is the bad thing.

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February 07, 2012, 07:01:56 PM
 #43

I wonder what would happen to the world if borrowing currency became illegal. Not just no interest on loans, but no loans on currency to begin with.
I think the definition of a "currency" would broaden significantly if this were to happen.
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February 29, 2012, 10:21:52 AM
 #44

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Bitcoins at this point in time are risky to even own.  They swing wildly from day to day.  I could lend 5btc and in return get 4btc back if btc raises in value.  I still do get a healthy return.

Options are the answer of course.

My Credentials  | THE BTC Stock Exchange | I have my very own anthology! | Use bitcointa.lk, it's like this one but better.
hashman
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February 29, 2012, 11:51:45 AM
 #45

I wonder what would happen to the world if borrowing currency became illegal. Not just no interest on loans, but no loans on currency to begin with.

That is, you only have what people give you, or you create yourself (through labor) -

Would it improve human relationships?

Would it destroy the idea of raising capital?

Would it kill millions of people?


Like any prohibition of victimless behavior, it would kill a lot of people and create huge problems such as corruption, monopolies, incarceration and all the associated problems.  This is very basic psychology.  Interest rates would go up, but people will not stop lending or borrowing.  Everyone suffers, even the few who get rich with their overpriced black market services.  I was hoping we could move past this kind of idiocy soon. 


 


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