Snow: The token supply can grow (if speculators drive up the price) until the price stabilizes. And the token supply can fall (if speculators drive the price down) until the price stabilizes. But in both cases, the stable price is when the value of the token matches the money real applications are spending to buy Entry Credits in order to put data into the protocol. That is because the 73K factoids generated each year naturally trends to the value of the factoids drained from the supply to write into the protocol. If people are spending 1 million dollars to put data into factom per year, then 73K factoids should be worth 1 million dollars.
So ... it appears that the price of Factoids is directly related to the extent of their real-world use.
Once again, confusion over whether the inflation is 73K Factoids per year (as quoted here) or per month (as widely quoted elsewhere). Until somebody corrects me, I'm going to use an inflation rate of 73K Factoids per month = 876K Factoids per year. Sadly, this makes us all 12 times poorer than Paul would suggest once M3 kicks in.
It's pretty simple guys. David Johnson talked about companies wanting to enter billions of entries. I am personally looking for Factom to CONSERVATIVELY have 1 billion entries per month within one year from now. Let's say 10 entries per EC so that means 100,000,000 EC's burnt per month just from companies Factom Inc is already talking to. At .001 EC/Factoid, that means 100,000 Factoids burnt per month. That means, within one year, I believe Factoids will be a deflationary digital currency.
I believe trying to value Factoids based upon the equations you guys are throwing around is very short sighted. It would be like trying to value Microsoft before they signed that first IBM contract to provide them the DOS operating system. Bill Gates had identified an ENORMOUS and HIGHLY LUCRATIVE niche that needed filled and he had put together the team necessary to execute on that vision.
How do I value Factom and how am I investing here? I am investing as if we're dealing with Microsoft, circa 1980.