Actually.... the more I read discussions of this, the more I think I like permainflation. Not for bitcoin, of course, but in general for currency. The thing is, I have started to see bitcoin as more commodity than currency. Much like gold, its a good way to hold value, better than gold in that its far easier to transfer but....

It seems like you really want multiple vehicles for various purposes. Bitcoin, gold etc is great for holding value, even going up in value over time. It encourages hoarding, or "saving" to use a more positive term.

On the other hand, something that has a value that floats and encourages hoarding is less desireable for a store. When buying and selling goods etc, you really don't need or even particualarly need something like that. I think its more something whose value stays relatively constant with that of the goods that its used for.... it doesn't matter whether its inflation or deflation, you can't re-price an entire supermarket every few hours.

That said, bitcoin has some obvious gaps, 10 mins per block, etc. Seems to me that it would almost make sense for an inflationary currencty (not that I am sure what sort of formula it would want to use or would even make sense) to compliment bitcoin. Something that you know is going to inflate so rather than keep it, you get small amounts to use as needed.

Much like someone who keeps a hoard of gold still needs to trade small amounts of that gold for dollars to go shopping, but, doesn't use cash as a savings instrument (since its not very good at that).

Just my thoughts now, my thinking on this changes every day or two so take it with a grain of salt.