Re: Those who deny that BTC will rise to seven figures: clearly explain yourselves
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I have proved that deflative currency will incentivise spending and discourage hoarding permanently when a certain amount of saving is done
I have proved that deflative currency will incentivise spending and discourage hoarding permanently when a certain amount of saving is done
Where? If you have, you're the only one.
It's very simple, just one more step: Deflative currency at first will encourage hoarding, but when people build up a reserve through hoarding, that reserve will increase in value over time, so you have a guaranteed income source, a secure net, that will encourage spending long term wise
https://bitcointalk.org/index.php?topic=277275.0
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so this is not the real reason behind the adoption of inflative currency
You understand that fiat != inflationary currency, right? Fiat can also be deflationary, if that's what you want. Most people don't.Debt based fiat money issuing must be inflationary, because you have to print more money to pay back the interest. Look at the ever increasing national debt, without ever expanding money supply, it is not possible to pay back those debts' interest
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The real reason could be:
1. Without a fast circulation of money, the banks would not make enough income in interest
1. Without a fast circulation of money, the banks would not make enough income in interest
Why?
Commercial banks mostly living on the interest difference between loan and deposit. A deflative currency will encourage saving instead of borrowing, so banks will have no income. An inflative currency encourage borrowing, it can be loaned out many times through FRB, banks can make lots of profit during the process
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2. If people don't spend fiat money, then they don't need fiat money, then fiat money will lose its value quickly, the money printing scam will be discovered easily
So don't spend fiat money, don't use fiat money, and your problem's solved. Presto!
If no one is borrowing money from banks, banks will have huge problems. Their trick to keep the value of fiat money is to let the government borrow more and more from them