> as you can#'t make gains just by sitting on the medium of exchange So instead they speculate on assets like commodities and energy (excluded from core inflat

> as you can#'t make gains just by sitting on the medium of exchange So instead they speculate on assets like commodities and energy (excluded from core inflation) and real-estate. How is that any better? > And yes, inflationary currencies encourage investment You can't encourage investment without encouraging savings. What you end up with is too much money going after too few assets. This is why interest rates are so important. Too high and the market bubbles, too low and the market tanks. For inflationary currencies, you have a group of dudes who declare what the rate should be. That to me is the weakest part of this whole scheme. Instead of a council of wizards declaring the interest rate, market money works more like a feedback loop - with the rates being set by supply and demand. The best part of market money is, instead of banks being allowed to loan out printed money - loans have to come from people who save and defer consumption.