What Is Financial Value?
From my view, there is no such thing as objective, intrinsic financial value and all claims of "utility" value (with regards to finances) are just proxies for what individual actors transacting on a market decide based on current context. Financial value is an emergent property of moment-in-time, voluntary transactions which lead to price discovery.
That's what this video is all about. As we better understand economics, we can prosper and understand what gives cryptocurrency financial value. Governments and central banks understand these truths. It's past time we understand them also.
Click the image above (or the link below) to view this on DTube. Or you can view the embedded YouTube video here:
I'd love to know what you think in the comments.
How do you determine financial value?
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Hey @lukestokes. I just started to dig a bit deeper and to try to understand how the Steem economy works, and value is one of the things that definetly need to be defined.
I am already studying what is the actual definition of value, wich will probably be the next topic of my steemit guide.
But i think the main problem i see is that people can't understand that there is a big difference between "price" and "value", and that changes everything.
If possible, would be nice to hear your opinion on the article i wrote about the Steem economy concept
Excellent post and a great example of adding value to a discussion. Your post is already past 7 days so I can’t vote on it to reward you, but I’ll give you a nice vote here and a follow. If more people added value to comments like this there’d be no need for upvote bots for attention or useless spam. Well done!
I'll help you upvote him too.. I agree @phgnomo did a good job of breaking it down.
Thank you for the vote, especially for the visibility to your audience.
Glad to hear also that you got interested on my writings.
The main thing that attracted me here to steemit is the fact that it is a bit easier to get people to read what you write, than just having a independent blog (wich i also have, but it is only on portuguese.
I am trying to finish the next part today.
Thank you again, and everyone else that gave me this support.
Yea great post indeed. Find out what true wealth is https://steemit.com/true/@askgloria/true-wealth
Just to let you know, i just finished to write another piece about steem economy. Would be nice to hear your opinion.
https://steemit.com/steem/@phgnomo/steemconomy-let-s-talk-about-price-and-value-of-steem-sbd
An awesome post (the one you linked) from a purely economic point of view. Too bad it already paid out. But I will follow you just like Luke did and vote a recent post by you as well. Adding value is what will always bring you good things.
Your comment caught my attention because it mentioned Steemit economy. It's something I have covered too in my own way. If you are interested in reading more, you can do it here. It covers Steemit economy and its currencies in detail.
Thank you for linking your article! More research material.
Computta
https://computta.com/?ref=268161
These guys have really figured this out. You can make money while you sleep, Just signup Download the free miner. There is never a fee. (not to sound like a shill) This is like a money drop! I will post again with details of my profits.
@steemcleaners @lukestokes this account is guilty of comment farming.
Easy....mining. More fun with friends!
Computta
https://computta.com/?ref=268161
These guys have really figured this out. You can make money while you sleep, Just signup Download the free miner. There is never a fee. (not to sound like a shill) This is like a money drop! I will post again with details of my profits.
Financial value is money and money is people, animals don't use or need money only humans do.
pocketsend:1000@phgnomo, great explanation of the Steem economy, thank you!
Successful Send of 1000
Sending Account: paul.atreides
Receiving Account: phgnomo
New sending account balance: 2579329
New receiving account balance: 999
Fee: 1
Steem trxid: c93321197f9e2744abb88dc67335467e5979ed1c
Thanks for using POCKET! I am running this confirmer code.
Agree to the Price and Value difference. Its like those cards that work in Food courts. A regular card is of no value until a food court decides to accept it. Yes it got value.
Next week 3 more food chains agreed and decided they will accept the card. Yes the value goes up instantly. Its directly proportional to the acceptance level i feel.
Financial value is arguably the end result of the other value systems that come into play. For example one person may value a token for speculative reasons. Another values it because of the utility the token provides. Others could value a token for sentimental reasons, for the sake of collecting things etc. although I suspect that speculation + utility are well more than 99% of the financial value, with speculation being 90% of those two right now.
The problem when you get away from utilitarian value is that the speculative value can more easily disappear all of a sudden without the utilitarian value to back it up. The utilitarian value ensures that even when the collective belief changes greatly, the people who need the token for its utilitarian purpose will provide a buffer against that change. There are many examples throughout history where value has been purely speculative with no utilitarian basis, or based upon false beliefs, the financial value can disappear entirely into nothing.
Interesting perspective. I agree, utility value is kind of the underlying base point for all our beliefs about value in that it tells the most convincing story we can trust others will most likely agree to also. I still don’t think it’s completely objective and unchanging as even our understanding of utility changes as our technology and beliefs change.
How it solved problems to the society determined its value, hi @lukestokes
you might want to check my post too about asset value, thanks. :)
It's true that value comes from what people who are willing to transact give to certain exchanges. Value is in the eye of the beholder.
Great video Luke...
Well said, @lukestokes
I've always liked to debunk the idea of 'intrinsic' value with this little scenario:
Imagine if you were marooned on a desert island via a plane crash - with no real hope of rescue anytime soon - what would be more valuable to you? The 15 gold bricks you happened to find in a treasure chest - or the 15 lbs of potatoes you managed to scrounge from the supplies in the plane wreck? Of course it's the latter.
As you said, value is entirely subjective - it's just a question of the situation one finds themself in. (ie. Supply and demand will always reign superior, no matter what.)
Great analogy. I had potatoes for dinner tonight with lovely melted cheese. I’d defiently pick the potatoes. :)
By the time I hit my teens, I learned to never doubt the delicious taste of a potato with melted cheese! :-)
value of money and value of time... in my opinion
Time is a resource that will always be scarce.
Thats right ...have heard time is money ...and this is the platform which proves it...
I've been talking with my friend about that today. Image what would happen if whole world use 1 currency., or few of them. What would be their price? That's actually imagination and changeable value. Money is a pyramid and the richest will have more and more, but "these down" less and less.
Only if you play their game. If everyone in the bottom of the pyramid wanted play a different game and create their own tokens of value backed by belief and value they created for each other, how could they be stopped? If the rich provide more value, the rich will gain more.
You're right and that's why are we here I guess.
How do I determine financial value? Well, is anyone envious of what I own? Or am I envious of their property? As a coin collector, it's obvious that I can hold a piece of metal in my hand and admire it. Or be proud that I have a collection that no one else does. But, to me that's not really financial value. I need to be secure in my future and my safety. If my metal coins provide that, that's good. If not, they're worthless and I need to look elsewhere.
Envy is a strange metric, but I think I get what you’re laying down.
Great and quality video , you truly explain in context the word financial values. But to my understanding i think financial values are the monetary worth of a assert at a given period of time
Yep. Sounds similar to what I was saying.