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So Gold that was deflationary over long periods was not a 'real' currency? Your economic arguments are simply wrong. Deflation by money destruction will hurt th
by nickik 14y ago
So Gold that was deflationary over long periods was not a 'real' currency? Your economic arguments are simply wrong. Deflation by money destruction will hurt the economy, like in the Great Depresion. Deflation that happens because of increased in production will not destroy lending. The real intrest rate will still be positiv.
The real story is more complicated since I have ignored money demand.
Note that I have not said Bitcoin will become a 'real' currency. There are real problems, Im just saying that your argument is wrong.
- jongleberry 14y agoyour argument is tangential. bitcoin's inherent deflation is not by money destruction nor increases in production, thus these arguments are not relevant, although true within its own context. since bitcoin, like gold, has a finite quantity, deflation is mostly due to demand, which you have chosen to ignore in your argument.