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Comment by gnaritas | Hacker News Reader

> Deflation is better for holders of a currency.

No it isn't, you're forgetting that with deflation comes less wages as well. Deflation is the whole economy, not just a few sectors.

> Price deflation means that the value of your currency is rising as compared with goods you want to buy.

Which is meaningless when you're getting paid less as well.

> It's only with persistent antics of rulers and governments

Alright, tinfoil hat guy, we're done. I need no lessons in Bitcoin from you, I hold them and actively trade them, you don't know anything about them I don't already know.

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>> It's only with persistent antics of rulers and governments >Alright, tinfoil hat guy, we're done. I need no lessons in Bitcoin from you, I hold them and actively trade them, you don't know anything about them I don't already know.

A strange comment. I read a lot on the history of monetary systems and currencies, and I'm yet to come across an instance where widespread inflation (and a severe decline in economic activity and living standards) wasn't caused by a ruler or a government deciding to debase a currency to either fight a war or an attempt to fix mistakes they had already made with public spending. That was true 2,000 years ago, it's been true in most centuries since, and it's certainly true now. It would take a particularly odd view of history to conclude that rulers and governments manipulate currencies to help out their citizens, rather than to appropriate from them.

Note that I am interested in Bitcoin precisely because of this history, because it represents something genuinely new.

Inflation isn't the devil, severe inflation is; predictable mild inflation is stimulative to an economy. The devil you should be paying more attention to is deflation, even mild deflation makes the economy sluggish. People might like cheaper things, but they don't like lower wages and retailers certainly don't like lowering prices continually.

Your comment leads me to believe you confuse money with wealth. If inflation is stealing your savings, you're saving wrong. Cash is not for saving, it's for spending. Save assets, not cash.

Umm, what? Wages denominated in USD become less with inflation. Wages denominated in BTC become MORE with deflation.

Why would you get paid less? Deflation means the wage you get paid is worth more. Inflation means the wage you get paid is worth less.

Well first off, no one has wages denominated in BTC, it's far too unstable to do that yet. People are being paid their USD equivalent in BTC, but their salaries in still denominated in USD.

> Why would you get paid less?

Because you are not an island, when an economy suffers from deflation the prices of goods and services have to be dropped and salaries get dropped as well because that's how business works. Your employer isn't going to sell his stuff for less but keep paying you more.

> Deflation means the wage you get paid is worth more. Inflation means the wage you get paid is worth less.

Yes, I know what the words mean. But the effects of inflation and deflation are far more complicated than just the meaning of the words.

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