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Comment by beefield | Hacker News Reader

It's a pity that the venn diagrams of people who understand the need for private money transactions and people who understand the macroeconomic need of (occasional) negative interest rates do not in practice seem to overlap.

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The usual argument for why negative interest rates might be needed is to prevent deflation. But in a fiat currency system like we have, it is always extremely easy for governments to reduce the value of the currency (ie, stop deflation). They can just print more money. In detail, they can just finance government expenditures with money created out of nothing, if necessary cutting taxes to provide more need for money to be created that way. This is in fact what has happened many, many times. It's not some strange fringe theory. There is no doubt whatever that it works. There is no need for negative nominal interest rates.

Why is it a pity? Over time it will be revealed which group was thinking with the most clarity and prudence.

It's a pity because we should be seeking solutions for both problems, money system allowing negative rates and private transactions. They should not exclude each other because both are important for different reasons.

negative rates are stupid and make no sense.

all fiat currencies have number-go-down technology. look at a graph of purchasing power vs time for any fiat currency. It always trends towards zero.

start using a currency with number-go-up technology. look at a graph of bitcoin. instead of going down, the number goes up. you should adopt this type of currency.

I am aware this sounds stupid. I am also 100% convinced that it is true.

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