A currency can't make value out of nothing for long.
Why, my dear fellow, that is exactly how every government-backed currency works today!
And, thanks to its inflationary nature, it becomes virtually worthless over time:
Although inflation has remained low in recent years, it ravages the value of paper money over time. A dollar in 1900 is only worth about $0.04 in today's currency.
My point was simply that no currency is backed by "stuff" any more. I was responding to your criticism of Bitcoin ("A currency can't make value out of nothing for long").
Of course Bitcoin is deflating - it was designed that way. And of course fiat currencies are inflating - there is no limit to how much can be printed except reason, which is apparently in short supply.
Why, my dear fellow, that is exactly how every government-backed currency works today!
And, thanks to its inflationary nature, it becomes virtually worthless over time:
Although inflation has remained low in recent years, it ravages the value of paper money over time. A dollar in 1900 is only worth about $0.04 in today's currency.
Quoted from: http://finance.yahoo.com/blogs/daily-ticker/bitcoin-prices-b...