Quote from: Ix on February 07, 2014, 06:09:23 AM

Quote from: zipmaster on February 07, 2014, 05:18:26 AM

As a result, as currency deflates, the ultra rich find themselves holding excess wealth whose utility is of small effective value.

How can you think that when there is evidence all around us of what "ultra rich" do? They control media and therefore public opinion, they control government and therefore public policy. When quality of life is no longer an issue, it becomes about power. There is no magic spell that makes this work differently in bitcoin. If ultra rich are induced to spend more, what do they spend it on?

Ultra rich in fiat have enormous power because of incentives and power structure set by politicians. In a system where government have the power to invade liberty, regulate, set values and redistribute money to such extend as today there is great potential for corruption.
Ultra rich in bitcoin will have great power too. They will set very strong incentives. For example they can desire space travel or building private islands with self-sufficient communities realizing their social utopias. They can have most exotic whims, even perverse ones and they will offer so good price that people will compete almost to death to fulfill those whims. But in Bitcoin world it would be enormously more difficult to ultimately force people to trade with ultra-rich. The freedom is in the choice to refuse offer 500 Milions USD for your old house, to refuse even 5 Bilions and to refuse to sell it at all. On the other hand you can not refuse to participate in bailouting TBTF bank if the government decides it is right (and compulsory) thing to do.
So the ultra rich will probably spend on luxury, encouraging its development and consequently bringing the new luxury to the masses. Cars, traveling to foreign countries, personal cinema (television), using plane, mobile phones ... all of that started as a luxury for the very rich. Without them there would be insufficient incentive to develop these areas and insufficient rewards for the smart ones doing so. You can say that ultra-rich will provide new and enormous opportunities for the exceptional ones (individuals, corporations) best able to fulfill their wishes and ideas. Of course, one of very deep needs buried in people is "I want others to hold the same values as me! I want to influence them and "make them see"!" We shall see how big this quest for power will become.