Well sure, that can and will happen, but the new competing currency must first be superior to devalue the old currency, as the failures of Ixcoin and I0coin have demostrated. The primary purpose of this currency is as a means of exchange rather than a store of value anyway so a new superior currency would be embraced, not fought.
Well the point is that there is no security in the fact that your original currency is "limited". If a new superior currency comes along, your original coins will be worthless, that's pretty deflationary.
Saving as in "holding your money on your wallet" is discouraged, saving as in "trying to maintain your purchasing power somehow" is not. The only thing that changes is the way to save; instead of just holding it you buy assets like stocks, bonds, ETFs, commodities, etc.
True, and if you guys are able to have stocks, bonds, etc. available when you launch I'll be impressed and buy some coins
. The general concept is interesting, I just feel this works better in the short term weak economy environment, it would definitely help our current economic situation. The question is would it work long term, and what effect would all that spending have in a good economy? What are the long term consequences. I don't know.