Chapter II

Economics

A large rose tree stood near the entrance of the garden: the roses on it were white, but there were three gardeners at it, busily painting them red. This Alice thought a very curious thing...

Money doesn’t grow on trees. To believe that it does is foolish, and our parents make sure that we know about that by repeating this saying like a mantra. We are encouraged to use money wisely, to not spend it frivolously, and to save it in good times to help us through the bad. Money, after all, does not grow on trees.

Bitcoin taught me more about money than I ever thought I would need to know. Through it, I was forced to explore the history of money, banking, various schools of economic thought, and many other things. The quest to understand Bitcoin lead me down a plethora of paths, some of which I try to explore in this series.

In the first seven lessons some of the philosophical questions Bitcoin touches on were discussed. The next seven lessons will take a closer look at money and economics.

Again, I will only be able to scratch the surface. Bitcoin is not only ambitious, but also broad and deep in scope, making it impossible to cover all relevant topics in a single lesson, essay, article, or book. I doubt if it is even possible at all.

Bitcoin is a new form of money, which makes learning about economics paramount to understanding it. Dealing with the nature of human action and the interactions of economic agents, economics is probably one of the largest and fuzziest pieces of the Bitcoin puzzle.

Again, these lessons are an exploration of the various things I have learned from Bitcoin. They are a personal reflection of my journey down the rabbit hole. Having no background in economics, I am definitely out of my comfort zone and especially aware that any understanding I might have is incomplete. I will do my best to outline what I have learned, even at the risk of making a fool out of myself. After all, I am still trying to answer the question: “What have you learned from Bitcoin?”

After seven lessons examined through the lens of philosophy, let’s use the lens of economics to look at seven more. Economy class is all I can offer this time. Final destination: sound money.