Quote from: MoonShadow on March 25, 2013, 07:32:07 PM

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Currently its actually incredibly deflationary if you define deflation as price deflation.

I don't, and no economist worth listening to does either. Inflation and deflation are best defined as the two most likely consequences of expansion and contraction of the monetary base, relative to the size of the economy that it represents, repectively.

Actually my university text book defines deflation as a general decline in prices; as do most places I can find online:

In economics, deflation is a decrease in the general price level of goods and services.
http://en.wikipedia.org/wiki/Deflation

Definition of 'Deflation'
A general decline in prices, often caused by a reduction in the supply of money or credit
http://www.investopedia.com/terms/d/deflation.asp

"What Is Deflation?"
Answer: The standard deflation definition is when asset and consumer prices continue to fall.
http://useconomy.about.com/od/pricing/f/Deflation.htm

So yes; the bitcoin economy is very much deflationary right now and will likely remain so for the foreseeable future.

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Again, worse for whom? There are alwasy two parties to every trade, buck.

reread the phrase; I said deflation will get worse. Im not sure who you want me to attribute that to.

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There is no such tihing as a deflationary spiral. It's only an economic theory that has no real world examples.

I guess those are all made up then:
http://en.wikipedia.org/wiki/Deflationary_spiral#Historical_examples

That said, what counter examples would you give of prosperous societies with permanent deflation?