Tuesday, March 29, 2022

Pierre’s Libertarian Economy

So, putative CPC leadership front runner Pierre Poilievre wants to rejig our economy and monetary policy to use cryptocurrency. In Poilievre’s mind, central banks have “too much power”, and expanding the role of cryptocurrency and blockchain technology in our monetary system would start to break that power down. 

In particular, Poilievre keeps claiming that the quantitative easing policy was equivalent to “printing money” to finance the government.  This isn’t really the case, but it’s an easy, pithy thing for him to say, and a lot of people simply don’t understand enough about government finances and the interacting systems in the markets that are involved, so they will gravitate towards his simplistic explanations. 

The most recent arguments are that somehow cryptocurrency can be a hedge against inflation. There are certainly lots of cryptocurrency advocates that argue that in fact cryptocurrencies can act as a hedge against inflation.  However, we have to recognize that in order to act as a hedge against inflation, cryptocurrencies have to maintain a general valuation that is ahead of the pattern of inflation. The problem here is that cryptocurrencies have been incredibly volatile for the last several years, so the argument of any one cryptocurrency - or even all of them - being an effective hedge against inflation. 

Then we come to an interesting problem with crypto:  vulnerability. Because blockchains are highly distributed, they are highly vulnerable to hacks - and unfortunately, it can be weeks before somebody notices. In so many ways, crypto returns us to the proverbial days of the “Wild West”.  The potential for this to make crypto theft an avenue for attacking a rival nations’ finances really should make us all nervous. 

Lastly, we should take a long look at El Salvador’s experiment with making cryptocurrency part of its national money policy. To call it a disaster is a kind description. At this stage in the development of this technology, I don’t believe that there is sufficient expertise in policy or in securing the technology domain to make it safe to incorporate into the money policy of a nation. 


Tuesday, March 01, 2022

Chilling Words

Ever since Putin started massing troops along Ukraine’s eastern border, I’ve been wondering exactly what Russia’s objectives really were. 

Put aside the propaganda from Russia about Ukraine posing some kind of threat, and one is left wondering exactly what Putin’s goals are in invading Ukraine. Russia’s claim is that Ukraine hasn’t lived up to its commitments in the Minsk Protocol. I’m not really close enough to what’s going on to assess that, but that seems to me rather a contrived excuse at best. 

Putin’s foreign policy has long struck me as being filled with barbs intended to re-ignite the Cold War that formed much of Putin’s early career. He’s made a number of feints in that direction, the most blatant in my opinion was the annexation of Crimea, but there have been others. 

The military picture in this case bears paying attention to. As part of the former Soviet Union, Ukraine forms part of the border buffer between what was Soviet Russia and its arch rival Western Europe. It is entirely possible that Putin’s current goal is to re-establish the boundaries of the old Soviet Union by once again occupying a line of states that run from the Baltic Sea to the Black Sea, and operating them as puppet governments.

It’s possible, that those are his goals, but somehow I think it’s far more pernicious. On the news this morning, the Soviet Foreign Minister was quoted as saying “Russia won’t stop until the Western threat is removed” (I’m paraphrasing here - it was on the radio).  This is classic Cold War rhetoric - but it sheds a glimmer of light on Russia’s unstated goals here. 

It’s far more likely in my opinion that this is a “war of honour” in Putin’s mind. It’s the fight to re-establish Russia’s “greatness” on the world stage after the humiliation of the collapse of the Soviet Union in the 1980s.  If this is true, then the only way this ends is when Putin either breaks NATO, or Putin’s ambitions exceed what his oligarch allies can support.

The Cass Review and the WPATH SOC

The Cass Review draws some astonishing conclusions about the WPATH Standards of Care (SOC) . More or less, the basic upshot of the Cass Rev...