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by notdrunkatall 4632 days ago
Only if that currency is the basis for your economic system, and you wish to continuously stimulate artificial demand in your economic system through continuous currency debasement.

It has been theorized that though such continuous stimulus may lead to greater growth on paper, that growth is more likely to be malignant than it would be were the economy allowed to grow at a more natural rate. Furthermore, continuous inflation is also at least partially responsible for the business cycle. The price of money is the interest rate at which it can be borrowed, and constant inflation is what keeps interest rates low. When money's cheap, people tend to borrow more of it and are less careful about what they do with that money. Hence, due diligence declines, and economic bubbles become more likely.

1 comments

I guess it comes down to whether you believe people are overly conservative with their money. Inflationary currency incentivizes investment, which is useful in a world with scarcity. But if you believe enough people spend too much on luxuries, deflationary currency wins out.
What it comes down to is whether you think the increased growth from perpetually easy credit is worth the malinvestment and economic bubbles that come with it.