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1. globul+(OP)[view] [source] 2022-02-10 13:16:13
Why limit it to crypto? People don't question why the value of houses seems to magically rise globally despite no tangible value being added to the assets in most cases. People don't question why Wall Street traders get rich by trading second derivatives of mortgage backed securities with each other all day. What makes a mortgage any more "real" than an NFT?
replies(6): >>blfr+k1 >>dboreh+v1 >>sakari+X1 >>cutebo+C2 >>posix_+r3 >>ARandu+8r
2. blfr+k1[view] [source] 2022-02-10 13:24:19
>>globul+(OP)
People question it all the time. And a house has obvious utility. It's also kind of a share in the city's future. It can be mispriced but it's not entirely based on hype.
replies(1): >>globul+Hx
3. dboreh+v1[view] [source] 2022-02-10 13:25:14
>>globul+(OP)
The magical value of houses has been a concern for decades (see numerous housing crash episodes) but there is a difference: the payment stream from a mortgage is enforced by laws and backed by the ability to take ownership of the mortgaged property. Perhaps a better comparison would be NFT vs mortgage _insurance_.
replies(1): >>fusion+cI
4. sakari+X1[view] [source] 2022-02-10 13:28:09
>>globul+(OP)
You can live in a house, you can't live in an NFT.
replies(1): >>tomato+c7
5. cutebo+C2[view] [source] 2022-02-10 13:32:58
>>globul+(OP)
The scarcity of houses is real and physical. The scarcity of NFTs is artificial, completely made up.
replies(1): >>ajsnig+K3
6. posix_+r3[view] [source] 2022-02-10 13:37:51
>>globul+(OP)
Mortgage means somebody is going to pay somebody else regularly for 30 years, or bank gets a valuable property. That is more reliable wealth guarrantee than NFTs are.
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7. ajsnig+K3[view] [source] [discussion] 2022-02-10 13:39:06
>>cutebo+C2
> The scarcity of houses is real and physical

Not really in a lot of cities, most scarcity is based on government regulations (=not allowing more of them to be built, or not allowed to build larger ones). There are a few locations where there is no actual usable space to build more, but mostly, that is not an issue.

replies(2): >>notaha+P9 >>choko+Va
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8. tomato+c7[view] [source] [discussion] 2022-02-10 13:55:53
>>sakari+X1
Yes. NFTs are perhaps more akin to people who sell "plots of land" on the moon or Mars.
replies(1): >>scotti+Ru
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9. notaha+P9[view] [source] [discussion] 2022-02-10 14:09:20
>>ajsnig+K3
The scarcity of land is physical. And to supply more housing you need to pay for the ownership of physical assets, and then for people to physically demolish them and physically build bigger structures, which is a lot of expensive to take if the demand for property doesn't already exceed its supply

Or you could create more "limited edition" monkey pictures at essentially zero marginal cost.

replies(1): >>ajsnig+ka
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10. ajsnig+ka[view] [source] [discussion] 2022-02-10 14:11:28
>>notaha+P9
There are a lot of places where there is enough land to build more and more, but the governments don't allow it. And there are also places such as san-francisco, where replacing single-family houses with apartment buildings would solve a lot of the housing crisis, but the government (and NIMBYs) don't allow it.
replies(1): >>notaha+zm
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11. choko+Va[view] [source] [discussion] 2022-02-10 14:14:30
>>ajsnig+K3
The scarcity might be artificially created, but that doesn't make it any less real.
replies(1): >>ajsnig+Eb
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12. ajsnig+Eb[view] [source] [discussion] 2022-02-10 14:17:52
>>choko+Va
I mean, it depends. If you live in Tokyo, the scarcity is real-real. If you live in a city, where just a re-zoning solves a lot of problems, the issue is atleast mostly solvable, even if it means shaking down a whole pyramid of government officials, and in some places, the housing crisis is bad enough, that they're aproaching the critical mass of people to make this happen.
replies(1): >>fusion+XG
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13. notaha+zm[view] [source] [discussion] 2022-02-10 14:57:08
>>ajsnig+ka
Even in a world with zero building regulation you're still running into constraints though. Sure, people could build more apartments which would slow growth in accommodation prices and maybe directly hurt the value of the neighbours' properties they overshadow, but land is still limited amd expensive (more expensive if you're allowed to build tenement blocks on it) and construction still physically intensive and expensive, so there's still no incentive to drive prices down by supplying more apartments than the market demands.

cf NFTs where digital art itself can be copied and viewed infinitely, and the NFTs themselves are just tokens issued at near zero cost by providers which could happily issue infinitely more tokens referencing the same art (even though at the moment, for the sake of trust and collectibility and not dampening the hype yet, it's more lucrative to issue finite numbers of additional tokens referring to more low-effort variations on the original art instead.)

replies(1): >>ajsnig+x11
14. ARandu+8r[view] [source] 2022-02-10 15:14:44
>>globul+(OP)
This seems like a classic whataboutism. Mortgages being bad or good has absolutely no bearing on the quality of cryptocurrencies or NFTs. If crypto was actually good, you shouldn't need to deflect criticism with "but the existing financial sector also sucks!"
replies(1): >>globul+ew
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15. scotti+Ru[view] [source] [discussion] 2022-02-10 15:28:21
>>tomato+c7
NFTs are more like Lebron James rookie cards.

A piece of cardboard print with graphics on it, no rights to the image, art, athlete or organization.

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16. globul+ew[view] [source] [discussion] 2022-02-10 15:33:12
>>ARandu+8r
It's not a deflection. I'm saying the whole thing is a disaster. Crypto and NFTs are just the surface and are quite rightly causing people to question the meaning of it all. But if you dig a little deeper you'll find it's just an extension of what's been going on for a long time behind closed doors.

I thoroughly recommend the book Other People's Money by John Kay. In it he reminds us what the actual value of the financial system is and talks about what it has become. Bitcoin was an attempt to get the actual value of cash (just one facets of finance) without paying tax (interest) to the banks.

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17. globul+Hx[view] [source] [discussion] 2022-02-10 15:37:52
>>blfr+k1
I'm not talking about the houses, though. I'm talking about mortgages. Have you ever wondered why you can't just save up for a house and buy it with cash? Why do you need to first acquire this thing called a mortgage? What part is the bank actually playing in this transaction? You'll pay tax to them for 30 years but what exactly are you getting in return?

These are the questions that need to be asked.

replies(3): >>rchaud+tA >>fusion+LH >>pjc50+9N
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18. rchaud+tA[view] [source] [discussion] 2022-02-10 15:47:14
>>globul+Hx
Houses are acquired in cash all the time. There is no legal requirement to tie oneself to a mortgage, if you already have the means to pay the price in full.
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19. fusion+XG[view] [source] [discussion] 2022-02-10 16:09:51
>>ajsnig+Eb
You're playing semantics. If there aren't physically enough homes in NYC for the number of interested buyers there is Scarcity. Talking about that source of that scarcity is irrelevant. Re-Zoning fixes nothing in the short term and scarcity will remain. Even if you re-zoned you need to physically build up inventory which takes years.
replies(1): >>ajsnig+QX
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20. fusion+LH[view] [source] [discussion] 2022-02-10 16:12:58
>>globul+Hx
The reason people aren't buying a home in cash, which is not necessarily common but completely doable and not illegal or anything, is because almost no one can afford to do so. Saving for 30 years and then buying a house in cash all while paying rent somewhere in the meantime I think is pretty undesirable.
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21. fusion+cI[view] [source] [discussion] 2022-02-10 16:14:54
>>dboreh+v1
Not sure it's so magical. If you own a home in a city whose GDP is increasing every year it makes some sense that property in that city would also increase in value.
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22. pjc50+9N[view] [source] [discussion] 2022-02-10 16:32:16
>>globul+Hx
> Have you ever wondered why you can't just save up for a house and buy it with cash?

You can.

> What part is the bank actually playing in this transaction?

They're lending you the money.

I assume you have some different, less obvious answers to this? If you're against the lending of money for interest, how about a halal mortgage? https://www.qardus.com/news/halal-mortgages-everything-you-n...

replies(1): >>globul+uU
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23. globul+uU[view] [source] [discussion] 2022-02-10 16:59:46
>>pjc50+9N
> You can.

Practically speaking, not really. A tiny fraction of people might earn enough to save enough to buy a house, but most will be priced out at every stage by people taking mortgages. Some people inherit existing property and trade it for other property. But if you are starting from scratch it's virtually impossible. Do you know anyone who has done it?

> They're lending you the money.

Are they? If I lend you my car, I don't have access to my car during that time. But money is just made up. There's nothing moving around. Banks aren't losing anything when they lend you something. They just create a deposit and a liability and get on with it. As long as they are all doing it at roughly the same rate nothing stops the economy filling up on debt, as it has done and continues to do.

Remember, banks lending money is nothing like you or I lending money. The banks control the ledger. They don't play by the same rules as us.

replies(1): >>blfr+C81
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24. ajsnig+QX[view] [source] [discussion] 2022-02-10 17:11:14
>>fusion+XG
Yes, and new york (and san francisco, and many other places) are in a housing crisis for years now, and have not started any major building projects nor liberalized building larg(er) apartment buildings (in case of san francisco).

The best time to start building was 10, 15, 20 years ago, the next best time is now.

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25. ajsnig+x11[view] [source] [discussion] 2022-02-10 17:24:47
>>notaha+zm
I was born in a socialist country, where people built houses. Literally, you built first, dealt with papers later, and pretty much everyone had a house or an apartment. Government and companies built apartments for their workers, people built private houses themselves, mostly literally (every weekend, wheelbarrow, few sacks of cement, a bunch of bricks, a few friends, a case of beer,...).

After a bunch of regulation, now, the "papers" cost more than materials to build, and most of the area is zoned as eg farming area, even though there has never been any farming there. Of course, prices have gone up A LOT, there is a lot of NIMBYism, by people who already build their house, and don't want another one next to it, and young people are basically fucked.

We might disagree, but in places with available land (and there are many), the only thing that stands between housing and non-millionaire people are (local) governments and regulations.

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26. blfr+C81[view] [source] [discussion] 2022-02-10 17:52:06
>>globul+uU
Yeah, states usually do grant banks a limited right to create money. But once again, this is not based on hype. These states often have sovereignty, land, allegiance of their citizens, recognized legitimacy, police force, serviceable tax regimes, tanks, etc.
replies(1): >>globul+mc1
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27. globul+mc1[view] [source] [discussion] 2022-02-10 18:08:50
>>blfr+C81
So you're making an argument to the status quo?

I'm not sure are about states granting banks the right to create money. Do you have a source for this? As far as I can tell they do it simply because we all use them and trust them to keep the ledger. The state (meaning, the US or UK) doesn't seem to have much control over it.

replies(1): >>blfr+Ii1
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28. blfr+Ii1[view] [source] [discussion] 2022-02-10 18:39:04
>>globul+mc1
I'm making the argument or maybe just an observation that the current financial system has a basis in hard reality whereas blockchain/NFT/metaverse/digital ownership seem to break away from that.

The banks are obviously granted the limited right to create money by the government. Whether it's through regulation post facto or a charter a priori, by now virtually all modern states have a wide control over their banking systems, including setting required reserve rates.

replies(1): >>globul+Yz3
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29. globul+Yz3[view] [source] [discussion] 2022-02-11 09:40:09
>>blfr+Ii1
I paid for physical goods with Bitcoin. That seemed to have a basis in hard reality too.

> by now virtually all modern states have a wide control over their banking systems

This doesn't seem to be the case.

> including setting required reserve rates.

Can you find what the required reserve rate for the US and UK is? From what I can find the US does have a required rate but it's 0% and the UK doesn't have one at all.

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