Doesn't that make UST a derivative of LUNA? The price of UST when it is below $1 should be equal to the expected percentage that LUNA falls during the time it takes to convert your UST to LUNA and then sell that LUNA. Since doing that actually inflates the LUNA supply there is no point at which LUNA should stop falling (absent other value propositions) and therefore UST should always be below $1 and so LUNA should inflate away.

I'm probably missing something, but stable this is not.