Re:DeFi risks and the decentralisation illusion
by tablespoon on Tuesday December 21, 2021 @01:32PM
(#29640457)
> Lost me at "lack of shock absorbers such as banks" - DeFi has lots of flaws, but it takes truly a sheltered economists to think that banks absorb shocks!
My car has a bumper. It's not valid to claim it doesn't absorb shocks because it can't absorb all the shock of a 20mph collision. A similar situation might be the case here. It's quite plausible that banks absorb all kinds of shocks all the time, but we have a distorted view because the shocks we tend to hear about are the ones they didn't absorb (or didn't absorb as smoothly as usual).
> I will pay attention when Goldman Sachs starts to hand out stimulus money or even loans in a crisis to absorb the shock
Isn't the fed a bank and hasn't it done things similar to "hand[ing] out stimulus money or even loans"?
My car has a bumper. It's not valid to claim it doesn't absorb shocks because it can't absorb all the shock of a 20mph collision. A similar situation might be the case here. It's quite plausible that banks absorb all kinds of shocks all the time, but we have a distorted view because the shocks we tend to hear about are the ones they didn't absorb (or didn't absorb as smoothly as usual).
> I will pay attention when Goldman Sachs starts to hand out stimulus money or even loans in a crisis to absorb the shock
Isn't the fed a bank and hasn't it done things similar to "hand[ing] out stimulus money or even loans"?