[retrogradeorbit]

re: 4. Deflation is bad for the asset rich, but good for the asset poor. Inflation is good for the rich and bad for the poor. Those who usually spout the 'inflation is better than deflation' argument are the rich.

The argument that inflationary expectation is better than deflationary expectation because during period of deflation purchasing stops because 'it will be cheaper tomorrow' is flawed because such periods of deflation are short lived, and the market returns to a price where people are willing to re-enter the market and purchase to gain utility from the goods and services.

Just be careful believing people who "know anything about money" without thinking it through.

For more: http://www.zerohedge.com/news/guest-post-if-you-want-help-po...

[scythe]

No, deflation is bad, period, for the economic actors who depend on deflationary currencies, and this is verified simply by looking at pretty much any historical instance of deflation.

http://en.wikipedia.org/wiki/Deflation#Historical_examples

Notice how nothing good ever comes of deflation? That should be a hint. I would be highly suspicious of the unsourced "In Ireland" section:

http://byline.timetric.com/2010/11/25/ireland-deflation-debt...

though there were some upsides: http://marketmonetarist.com/2012/08/14/good-deflation-the-ca...

I'm not against Bitcoin per se, but all this anti-inflation crap is, quite simply, at odds with historical data to the point that it has become essentially "views differ on shape of planet". If economics is to be useful at all, it has no choice but to be empirical, and everything we've ever measured has always told us that deflation is bad.

Perhaps Satoshi simply felt it was easier to implement finite Bitcoins than a constantly increasing supply. I don't think he can be blamed for that. Bitcoin is, if nothing else, certainly intriguing.

[jafaku]

You are confusing the short lived deflation that could be caused by a deflationary currency, with the deflation caused by all the other problems mentioned in the wikipedia article, like "technological progress that created significant economic growth", "great advances in productivity", etc. Apparently the only problem brought by gold and silver was that there was a scarcity of coins (a physical problem), which would never happen with Bitcoin (a digital currency).

> Perhaps Satoshi simply felt it was easier to implement finite Bitcoins than a constantly increasing supply. I don't think he can be blamed for that. Bitcoin is, if nothing else, certainly intriguing.

No, he was against inflation. In the first block of the blockchain, he added a message; it was something about Bernake approving a new bailout for the banks.

[phaemon]

> No, deflation is bad, period, for the economic actors who depend on deflationary currencies,

USD (or GBP or AUD etc) are deflationary relative to technological items, such as computers. By your theory, no-one should buy such items. In reality, they do.

I think this shows your theory is wrong.

[bpodgursky]

You absolutely have 4 backwards. Deflation is good for those rich enough to have money sitting around, and who can make money just by sitting on it and not investing it. Inflation is bad for the rich because suddenly they have to DO something with the money, or it disappears.

[jafaku]

Inflation is good for the rich's income. Deflation is good for the rich's savings. Seems like they win in both cases? Though I would argue they win more in the first case, since inflation don't necessarily force them to do something with the money. Eg: They could just sit on gold or real estate if they wanted to. But most rich people didn't get there by doing nothing, so they tend to do something anyway, no need to force them.