[betterunix2]

"I have yet to have an economist explain to me why deflation us bad"

There are a few different issues. First, volatility is universally bad for a currency, because it makes all transactions in the currency more risky. Money should always be a medium of exchange first and foremost; there should be little to no room for speculating on the value of money and people should not have to factor in unexpected changes in the value of money when determining prices. In general people will switch from more volatile to less volatile currencies because less volatile currencies make trade more efficient.

Unexpected deflation is particularly bad, because in addition to the general problems with volatility, it also triggers defaults on loans (because money becomes more difficult to obtain). Too many defaults in too short a period of time will create a "contagion" effect by reducing the collateral held by lenders (who use loans as collateral for their own debts), which triggers even more defaults. Worse, as lenders see their collateral vanish, they will try to make up the difference with money, taking money out of circulation and causing even more deflation and thus more defaults. This is the "deflationary spiral" scenario.

Inflation is not some trick to hand money over to "Wall St." Rather, a low, predictable rate of inflation is targeted so that there will be some "breathing room" during an economic crisis. It does not hurt people on a fixed income because it can be planned for and the fixed income can be adjusted for inflation (e.g. someone could hold a portfolio of TIPS). It also has nothing to do with the price of computers, which have become cheaper because of economic growth (and in fact have become cheaper over decades of inflation). Inflation also encourages investment activity by discouraging the hoarding of money, which is a good thing for the economy.

[cyphertruck]

It’s a shame you spent so much time patiently trying to explain all that to me, not realizing it’s probably the ten thousandth time I’ve heard this. I appreciate the efforts, bit that view is rationalization and I tried to save you the effort by pointing out that the technology industry has not stopped like you would expect if your view were reality.

And I assure you, as someone who holds bitcoin that has greatly appreciated, I can’t wait to spend it on things that depreciate.

In fact my spending has increased now that my spending power has increased dramatically.

[betterunix2]

OK, well, congratulations on your gains, you made a good bet, it paid off, and I hope you can put it to good use. It does not make anything I said false. You asked why deflation is bad, and I gave you a summary of the various reasons why.

As for what we should expect...why should the current situation be so surprising? The vast majority of merchants who "accept Bitcoin" use a third party payment processor that immediately converts Bitcoin into a fiat currency. The number of people who use Bitcoin as money, rather than as a system to communicate payments made in some other currency, is vanishingly small. The "technology industry" has mostly focused on non-monetary applications of blockchains and a lot of attention has been paid to "permissioned" blockchains because they are overwhelmingly more efficient.