Quote from: oser41eric on April 03, 2013, 04:37:47 PM

Current Bitcoin yearly inflation is approximately
144*25*365/11000000 = 12%
Current fiat yearly inflation is approximately 5%

That's incorrect. Bitcoin is NOT inflating at the moment, it is DEFLATING. It's true that the supply of Bitcoin is increasing through mining at the moment. This would normally decrease the buying power (value) of BTC. It's same as when central banks print fiat money. This is what you call inflation.

But due to the current hype and the growing awareness of more and more people about Bitcoin the BTC-demand is exploding and thus the value is increasing dramatically (=deflation). The inflation-factor is just so much smaller than the deflation-factors at the moment.

After all 21 million BTC have been mined, BTC will be still strongly deflating as long as it's still spreading around (big demand). And after it spread around the world (no big demand by people without BTC or there are no more people without BTC), Bitcoin will be still moderately deflating, because Bitcoins get lost. That's why you say Bitcoin has a built-in deflation. There is simply no possibility for inflation except a all-time BTC-price drop (and that will only happen if there is a proof that BTC doesn't work (technically, conceptionally or regulatorily -- I personaly don't think the latter will happen).

Quote from: oser41eric on April 03, 2013, 04:37:47 PM

Of course we mine the Bitcoins out of thin air, today mined Bitcoins were not in supply yesterday. Also by your flawed logic if we limit supply of fiat to 10^30 times current fiat amount wich could goverments sign because it will never go to this scale then mysteriously fiat is no longer inflationary currency because no more than 10^30 times current fiat amount can be created

Inflation happens when money is created out of nothing. Fiat money is either created by printing money (exactly what is not possible with BTC in long-term) or by banks granting credits without holding reserve, also called credit money (both IS happening all the time).