4 ms·

That's a valid concern but it doesn't stand scrutiny. Production itself doesn't create deflation. If the number of goods and services in the world remains more

by snitko 14y ago

That's a valid concern but it doesn't stand scrutiny. Production itself doesn't create deflation. If the number of goods and services in the world remains more or less constant, it means there is no deflation. At the same time, people will still be working and producing things. It's only when money are invested then you have a surplus of things in the economy which deflates the money. By investing, hoarders allow others not-yet-rich people access to capital. Thus, if hoarders want to become richer they will have to make rich others too.

Nursie 14y ago
"If the number of goods and services in the world remains more or less constant" Does it though? I thought we were all addicted to growth? If we continue to have any growth then with a limited cash supply, each unit becomes worth more (deflation). "By investing, hoarders allow others not-yet-rich people access to capital." I'm not clear on how you think this works, because (AFAICT) hoarding BTC is just holding on to currency, not any sort of investment? " Thus, if hoarders want to become richer they will have to make rich others too." Or they can just sit on it while others do the work and achieve much the same with no risk...
- snitko 14y ago
  Ok, I think you misunderstood my statement. I was saying this: if you want growth, you need to invest. If you don't invest, you don't get more goods and services in the economy. If you don't have more goods and services, each unit of money can't grow in value (e.g. no deflation) because there wouldn't exist more things you can buy. Thus, if you want money to increase in value, you have to invest. It's a tricky circle, but once you understand it, it all becomes clear.
  - Nursie 14y ago
    Yes, but if currency is deflationary, it's best for me if someone else does these things and I just sit back and profit from my currency holdings.
    - snitko 14y ago
      Not necessarily. By investing you take your destiny in your own hands: you deflate your savings and also collect profits. It is not a given that those just sitting around will profit more from inaction, but it is true that you make them richer too. Well, I can live with that.

by snitko 14y ago

Nursie 14y ago

"If the number of goods and services in the world remains more or less constant" Does it though? I thought we were all addicted to growth? If we continue to have any growth then with a limited cash supply, each unit becomes worth more (deflation). "By investing, hoarders allow others not-yet-rich people access to capital." I'm not clear on how you think this works, because (AFAICT) hoarding BTC is just holding on to currency, not any sort of investment? " Thus, if hoarders want to become richer they will have to make rich others too." Or they can just sit on it while others do the work and achieve much the same with no risk...

snitko 14y ago
Ok, I think you misunderstood my statement. I was saying this: if you want growth, you need to invest. If you don't invest, you don't get more goods and services in the economy. If you don't have more goods and services, each unit of money can't grow in value (e.g. no deflation) because there wouldn't exist more things you can buy. Thus, if you want money to increase in value, you have to invest. It's a tricky circle, but once you understand it, it all becomes clear.
- Nursie 14y ago
  Yes, but if currency is deflationary, it's best for me if someone else does these things and I just sit back and profit from my currency holdings.
  - snitko 14y ago
    Not necessarily. By investing you take your destiny in your own hands: you deflate your savings and also collect profits. It is not a given that those just sitting around will profit more from inaction, but it is true that you make them richer too. Well, I can live with that.