El Salvador abandons Bitcoin as legal tender

Speculative asset class fails as non-speculative legal tender class.

If king for the day with a sovereign wealth fund I wouldn't forbid investment choices like this on risk grounds, I mean you need risk assets as well as boring ones, right? But I have problems with the moral quality: it's like state investing in the casino business. Monaco? works fine. Anywhere else? It's got problems.

Like a lot of people, I probably fall into severe errors which would be bread and butter for "bad economics" reddit groups but truly, I can't see how this wasn't forseen and expected. It was about WHEN, not IF.

> sovereign wealth fund

That reminds me of Hong Kong, where I used to live and which maintains a large sovereign wealth fund to ensure its currency is pegged to the US dollar.

While various US think tanks ranked it well on their checklists of "economic freedom", they tended to gloss over the rest of the recipe that made it work. Not just the huge sovereign wealth fund, but also how half the housing is government-run or subsidized and you don't really own land, you just rent it for a very long term from the government.

> you don't really own land, you just rent it for a very long term from the government.

This is probably economically a good idea, absent something like georgist land taxes. It eliminates some or all of the incentive to speculate in land, which is of course the whole problem El Salvador ran into with bitcoin as currency.

Economically, communism is a great idea. In practice, you get "collectivization" in the Soviet Union that basically starves millions to death

Don't millions starve too in capitalism?

No. No liberal capitalist economy has ever had a famine. By contrast, most communist economies have created major famines, and history's largest famines have all been created by communist economies, outdoing even colonialism in their death tolls.

These are well-known historical facts.

To save some time, can you define the True Scotsman here? Would the US in the 1920s count as a liberal capitalistic country for example? England in the 1860s?

Yes, and yes, which is one reason that, as it turns out, neither the US in the 01920s nor England in the 01860s experienced the famines that affected some other parts of the world at the same time. (In the 01920s Russia was experiencing its first famine that could reasonably be attributed to communism, and in the 01860s Sweden and Finland were experiencing their last famines before their transitions to capitalism.) But not, for example, Ireland in the 01840s and 01850s; that was neither, being colonialist and agricultural.

Nobody starved to death in "famines" like the so-called Lancashire Cotton Famine. By contrast, in the Finnish famine starting the next year, almost 10% of the population of Finland died. As it turns out, that was the last famine in Finland because it became capitalist over the following decades.

> But not, for example, Ireland in the 01840s and 01850s; that was neither, being colonialist and agricultural.

England was a capitalistic economy in the 1850s, no?

Yes, and England was at that time and for almost another century causing famines in its colonies abroad by preventing them from becoming either capitalist or liberal. Ireland didn't even get the worst of it; India suffered much worse under the English yoke.