Quote from: eleb on June 17, 2011, 08:43:33 PM

Inflation is good for holders of debt, but it also tends to (in small amounts), help make sure that the economy is vibrant - since if the money you hold today will be worth less in time, there's an incentive to spend it. Deflation give the reverse incentive.

Now whether either of these situations is better is a different question - and my guess is that Satoshi feels that the problems with inflation are greater than those with deflation, and that's why it's that way. It's a philosophical decision - that's all.

All of this, except the speculation about Satoshi, is false.

1) Inflation is good for holders of debt. Nonsense. Inflation makes interest rates higher, which is bad for holders of debt. Inflation makes it harder for people who hold debt to refinance and makes creditors want their money back sooner, which is also bad for holders of debt.

2) Inflation gives people an incentive to spend money. Nonsense. Inflation means you can get a higher interest rate if you save the money, giving you an equal incentive to save.

3) Deflation gives you an incentive to hold money. Nonsense. You can just as easily sell the right to hold that money and get its value today rather than holding it yourself.