There are special instances where an individual word rises all the way up to the top of communication hierarchy to represent an incredibly deep and important idea. Just a word, all by itself.

In Bitcoin, one such word is “quality”. It has been mentioned already in this essay series but it's time for a deeper dive.

It’s the slightly more mysterious of Bitcoin's consequences, primarily because it's a second-order effect on things outside of Bitcoin. Like most of it’s other consequences, it's a gift given by Bitcoin to all of us. Whether one holds Bitcoin or not.

Quality is certainly not a concept that belongs only to Bitcoin. But the point must be made that it’s a word leveraged constantly and inappropriately in our fiat landscape. It’s put all over the place hammering you that it is present in this product and that service. But is it really? Is that the lived experience?

I know, difficult to tell because it’s almost completely a matter of comparison. There’s always going to be better and worse between any group of similar things. It will always be that way.

But we’re not here to get critical of those who strive for quality, or even try to convince you that they offer it.

We are, however, here to establish two things.

The first… quality is the principal measure by which one decides to sell Bitcoin for a product or service. Pretty easy one there.

And second... quality is a name for the time-factor returning to goods and services. That’s time expressed as utility-per-unit paid. Think of it as holding onto more of your energy because a certain thing you bought works better, faster, longer, easier. You get the idea.

The two ideas are clearly related. So the main argument this… when a scarce, decentralized money like Bitcoin appreciates it means the costs of things it buys fall over time and the only reason to part with it is in exchange for the absolute best utility available for a given need.

When I say best, I mean truly the best. And sometimes that won’t even be enough.

In other words, quality is, once again, the killer app. Or better put, the survivor app.

Watch what happens if you try to sell something that’s short on quality.

Now, with Bitcoin in mind, might it still be difficult to determine which product is of the absolute highest quality? Yes. But compare that with today where the competition among manufacturers and service providers is a race to the lowest price while faking their quality message.

Or at best, greatly embellishing it.

They see the calculation being about consumer replacement costs going & staying low because generally, the utility component of stuff is going ever-lower.

Quality is low. Turnover high. Volume high. Margins low. Now, if you’re a sales-volume leader in your industry, so what. You’re fine because scale is how this degenerative zero-sum game can actually work.

But when you’re on the consumer side of this, you always lose.

Even when you get what seems to be a low price, there’s a high likelihood you’ll repair, replace or replenish the thing sooner and sooner because its quality has left the building.

We can call this the low-quality, high volume outcome. This is the inflationary, fiat reality.

Contrast that with the high-quality, lower volume outcome you get with the deflationary, hard-money reality in Bitcoin.

In both, the market pressure is to realize lower prices, as usual. Again, that’s happening with both in order to make a deal, just in very different ways.

With Bitcoin, recall the buyer gains purchasing power over time from the deflationary money they’re holding. So in accordance, what must producers do to stimulate purchases as their products stand to lose pricing power over said time?

They must increase quality. Absolute must.

Why is that? It’s because the buyer knows they CAN AND MUST see at least the same value savings in avoiding repairs, reducing replacements or delaying gratification as they will have realized by just hodl-ing the BTC over the same time period. A lot of consumers will be more than happy to wait for prices to drop. And then drop further. All the while they stand a good chance to see quality in the product offerings climb too.

Now, just in case the visual hasn’t flashed in your mind yet, the aforementioned "falling" prices are actually holding steady. Not necessarily falling in nominal terms. This is, of course, the value of the money going up.

You can think of it as purchasing power. Emphasis on power.

With fiat, we already know the buyer loses purchasing power over time because of the inflationary money. Obviously as this has been the story for a few decades now. So how have producers been getting prices down to meet the buyers where the purchasing power of their money is?

You already know. They lower quality and reduce quantity.

With their input costs lower, they can hold prices steady if not lower them a bit. But in either case, the consumer loses because quality is quick to take a massive hit and gets passed all the way to the final buyer, which is us. Let’s not forget, in the event producers go ahead and just raise prices, well, that’s obviously an additional hit.

Think producers can keep that nonsense going when it’s BTC you’re contemplating parting with for a product, rather than fiat currency? Not for a second.

Sound weird? Maybe at first. But just imagine putting off a purchase because the product is very likely to be at a lower cost next week. What about next month? This isn’t some sophisticated equation. Just a simple running of the numbers in your head.

Now you’re sensing where this deflationary money opportunity is headed.

For consumers, a dream. For producers, there’s first a question. Do you even understand how to execute with quality? Yes? Alright, there’s a path for you. No? Or unsure? Then it’s time to rethink your business.

Or consumers will rethink it for you. As will shareholders.

But this rethinking is what brings us directly back to the main idea. The producers must compete on the basis of quality FIRST. Keep that in perspective with where we are currently in the fiat world, where frequency is first. That’s frequency of goods and services sold, which can and should be observed as "rate", or rate of sales over a given timeframe. As we will detail further, you can also think of this as "speed".

There are three counterbalances that producers compete across. They are cost, speed and quality.

The first order of competition is always cost. That doesn’t change here, so not much else needs to be said. It remains the final decision point for nearly all consumers for most things and it largely results from how producers do with the other two.

Those being speed and quality. The economy is largely structured around the priority that producers give to these two factors.

Today, we have speed placed ahead of quality. Think of this as the “fiat” approach to production. And to economies overall.

Then we have the reversal of that idea where quality is the dominant factor, or dominant incentive. We can think of this as a hard money economic system. In other words, BTC and the Bitcoin network.

Moving along, there’s a well known mental model for applying these three factors for economic players to plan their businesses. It says… “Good. Fast. Cheap. You may choose two.”

And the producer gets what it wants with the third.

Again, if we consider “cheap” to be the relatively low price that consumers will forever continue to expect, it leaves “good” and “fast” as your parameters for this argument.

Good equals quality while fast equals speed.

It also means the mental model doesn’t necessarily have to be defined by which two you would pick. Instead, it’s about which order does the competitive producer put the remaining two factors.

Or to be a bit more dramatic about it, which ONE of the remaining two do you want to ensure? Speed? Or quality.

Speed and quality.

Two ways to think about competition. About production and consumption. About markets. About economies. About societies.

All these levels of communication and economics become organized around one of these two ideas. And the ideas themselves are implications of the underlying money. Fiat money organizes your society around speed. Hard money does it around quality.

You’re living with the former right now. But is a move to the latter even possible? What would that even look like?

There’s no way to detail such a transformation here but one initial aspect of it paints a picture.

If and when a hard money emerges in a society, it grows in adoption to the point where it is accepted and requested as a unit of exchange. Not necessarily the only one, but one in which producers price their goods and services.

What begins to happen next is the strange part. Prices in fiat currency and hard currency diverge. The hard currency prices are holding or falling as the prices in fiat currency rise. The two prices are, together, just one statement about purchasing power. And it’s very obvious.

Dramatically obvious.

Pay attention to the falling prices. That’s the one with increasing purchasing power. What else is going on there? Well, it’s something that describes the fall itself so it’s fundamental and extremely important to the story. It’s the price of the product or service going down to its utility value.

So what was the rest of its value? And where did that go?

It’s called monetary value and when it leaves, it’s just evaporating. Poof. Gone. Mainly because there’s a new “product” that does the job of money, and only the job of money. That’s what a hard money is for. To just be our money and be the very best at it. And nothing else. All the other stuff can go back to being judged for how well it does its thing.

“How well it does its thing.” Doesn’t that remind you of something? A word?

Now here’s a surprising aspect of this massive idea. The money is a product in-and-of itself. That’s it, just a product like any other product, with some sort of inherent utility.

But with money, we’re actually talking about the most valuable utility of them all. It's the product that's most exchangeable for ANYTHING else. And with hard money, you’re getting a product that maintains its scarcity, portability, divisibility and fungibility better than any other product in the world. Otherwise, that other high quality product would just be the money instead.

So while all the goods and services are falling to their utility value, hard-money is simultaneously rising to its utility value.

Excuse me...

Did you say it’s RISING TO ITS UTILITY VALUE?

Yes. Money is that important.

It’s all just one expression. An expression of purchasing power.

When purchasing power continuously improves for the consumers, it’s also making things better for producers. And that compounds instantly to societal improvements.

It all brings us back to the idea of quality. Society wants to be able to communicate and exchange quality. Humans are built to operate on systems rooted in quality. But societies need the money itself to be of the highest possible quality. It’s a requirement. Otherwise you have a society based on fiat money which is very low-quality money. The resulting economies suffer in a system that prioritizes speed and frequency over quality.

With increasing quantities of money it gets easier to purchase lower quality stuff more often. Therefore producers manufacture goods built for shorter life-spans, using less-durable or less-precious materials. And away the downward spiral goes.

Quality would certainly still stand out and be noticed in such a scenario, but it disappears over time because it fails to make economic sense. The cost to produce and sustain the high quality stuff is greater than what a market can pay for it. There’s too much low quality currency floating around in search of too few higher quality goods and services.

A total mismatch. Complete imbalance.

And then we turn towards the conclusion of this insidious circumstance. The decay that emerges in the people trading their time and energy for these products and services. It completes the circle of destruction.

Their fiat dollars are leaking purchasing power and their low quality food and products are draining their saved energy. That's taking a massive "L", on both ends of the energy & money game. And a third "L" to the extent they're paying taxes.

When you see anyone marketing lowered prices in our debt-backed, inflation-driven economy, you can be CERTAIN they've somehow taken quality out behind the woodshed and did a number on it. In any number of ways.

You have to see that the beating is ALWAYS passed down to the one exchanging the currency for the finished product or service.

That's you. The one working for dollars.

Suffocating from a lack of energy. Not just a lack of nutrition, but suffering the harm of artificial nutrition. That you're still paying for.

A lack of time because it takes more of it to earn your purchasing power. So you're hurrying to everything. Giving dedicated attention to nothing.

Ever hear of a cost-of-living raise? If you've gotten one it's a surefire signal that you're entering the foggy outskirts of employment instability.

Everyone says a raise like that is intended to keep pace with inflation. Sadly, few know it won't. Fewer understand that over time, employees have no chance at adding value commensurate with their compensation. This is how a workplace becomes the funhouse full of warped mirrors and employees thinking what they're doing is worth 8-times more than what it is.

So the money suffers, products suffer, workplaces suffer, employees suffer, customers suffer. Everything that depends on energy suffers.

Same can be said for nything that takes time.

And of course, as a consequence, quality suffers.

It's how the story comes full-circle. The fiat money fate is sealed.

A debt-based society ensures that there must be more currency printed than there is debt outstanding. It's how the lenders get an interest payment while also expecting the principal to be paid back in-full. Okay makes sense, if you’re going to pursue the debt-based society thing.

But what's your other takeaway?

Come on now...

Right, it's a guarantee that society, as a whole, will suffer the wrath of inflation. And it will continue forever.

And there goes quality, out the window. Bye-bye.

Where'd it go?

Alright, you get a hint. It left for a system where it is treated as a priority. A system where it is fed and where it grows. Where it's natural.

Ready for another truth bomb?

Quality is a main ingredient in your recipe for securing your future. It’s the big idea which allows you to have confidence in your future. It allows you to plan your future because quality gives you and your energy, your money, your property the endurance to be there when you need it down the road.

Think about it.

Stuff that doesn’t need hundreds of repairs to make it to next week. Prices that don’t require purchasing by the truckload to get reasonable unit pricing. Engineering, construction, and materials that won’t break on the third use. Food that’s not 98% artificial and nutrition that’s not in capsule form and doesn’t need pharmaceuticals to fix what the cheap food screwed up.

And of course the obvious one. Money that doesn’t bleed-out its purchasing power and die in the time it takes you to make a sandwich.

It’s non-negotiable if you prefer to have a pulse and remain upright and above room temperature. Because the lack of quality is killing you slowly.

And those are the lucky ones. They have energy stored someplace which can be converted to BTC and be enshrined in the future. Those without savings face the promise of a low-quality life much more consistently and severely.

Time is of the essence.

We’re talking about a world of falling prices, rising quality, ever-brighter and ever-more secure futures.

No more meaningless work in exchange for shrinking purchasing power. It’s really about less time working in general.

Nobody loses in this scenario. NO ONE LOSES!

If you’re the person that needs someone to lose in every exchange in order to understand the incentives properly, you have a long way to go.

The only argument you’ll hear against the nature of quality money is coming from those who are issuing the legacy currency. The profiteers of inflation with whom there’s no question who the losers are.

Hint, it’s not them. It’s everyone but them.

This is, once again, the story of inflation. It’s been detailed extensively, earlier in this essay series. But we’re circling back here at the close of this discussion because inflation is the mortal enemy of quality.

Quality and inflation. Locked in a death match.

And here we are mid-way through the 2020’s, witnessing the epic collision of these forces. Forces that are upstream of nearly everything else in society.

Quality versus fragility. Deflation versus inflation. Bitcoin versus fiat.

One side is what the world has known for over 100 years, as destructive as it is. It has been our teacher, our master, lulling us all to sleep. So, for some, it will be impossible to leave.

The other side, the solution, is the exact opposite, making it seem so foreign. So new. So improbable.

That’s the great irony.

The quality associated with Bitcoin is different, difficult, so unexpected, yet a total breakthrough. The fragility of Fiat is easy, cheap, familiar... yet so destructive.

So the challenge is in un-warping your brain. Like unscrambling an egg. It can be that hard. But it’s the only way you can properly steer your way out of your inflationary prison of a money.

It has to be yours though. Yours to find. To produce. You can’t be handed Bitcoin just like you can’t be handed quality because you first have to understand their relationship to energy and scarcity.

Either way, what happens now will echo for generations. The opportunity is monumental.

We have to get this right.

So I'm getting this right.