=) you're conflating meanings, perhaps due to some of my handwaving. There's a difference between a medium of exchange that loses value, and a medium of exchang

=) you're conflating meanings, perhaps due to some of my handwaving. There's a difference between a medium of exchange that loses value, and a medium of exchange that LOSES value. People don't want the latter. That potato is too hot. You want something that loses a measured, controlled, amount of value over time. How much? About 3% per year seems to be a good number that people more educated than me tout around. I'm also not sure that's a circular reasoning as I provide the reasons why you want a medium of exchange that loses value... Hmmm... sure, I suppose you can look at it that way. In an inflationary-esque economy, you worry about saving your wealth, so you create instruments to do so: fractional reserve banking, mutual funds, etc. This is a problem with many solutions. On the other hand, in a deflationary-esque economy, you worry about spending your wealth, and perhaps more importantly, getting everyone around you to spend it as well. That problem has less solutions. I said you struggle, you don't hold on forever, you struggle letting go. As in you eventually do let go, but not as quickly as if it had been depreciating. It functions as a brake on consumption, not a full stop. It slows things down. Slow is not good. Things start to go down when things slow.