The Bitcoin Standard: The Decentralized Alternative to Central Banking

by Saifedean Ammous

The larger the firm, the easier it is for it to secure low-interest funding, giving it a large advantage over smaller independent producers. In a society where investment is financed from savings, a small mom-and-pop diner competes for customers and financing with a fast-food giant on an equal footing: customers and investors have a free choice in allocating their money between the two industries. The benefits of economies of scale are up against the benefits of the personal attention and relationship between cook and customer of the small diner, and the market test decides. But in a world where central banks allocate credit, the larger firm has an advantage in being able to secure funding at a low rate which its smaller competitors cannot get.27 This helps explain why large-scale food producers proliferate so widely around the world, as their lower interest rates allow them higher margins. The triumph of bland, mass-produced junk food cannot be understood outside the great benefits that large scale affords to producers. In a world in which almost all firms are financed through central bank credit expansion, there can be no simple way of discerning which industries are growing because of the injection of bezzle steroids, but there are some telltale symptoms. Any industry in which people complain about their asshole boss is likely part of the bezzle, because bosses can only really afford to be assholes in the economic fake reality of the bezzle. In a productive firm offerin...