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If decreasing prices (deflation) are caused by increasing productivity, then the average worker will deserve the increasing purchasing power his fixed salary provides, and he will never need an actual raise or a pay cut (as long as he remains exactly average).
Right, but the real question here is what happens if deflation is caused by scarcity of currency occurring at a rate that's likely to exceed any increase in real value elsewhere. And the answer is, so long as this deflation isn't terribly unpredictable, nothing much will happen.I agree with you, JoelKatz. In a Bitcoin economy where continuously increasing demand drives up the value of bitcoins, general price decrease (deflation) won't have a negative effect on employment. At worst, employers and employees will occasionally renegotiate their contracts.
I think OP's real question was more general:
Would there be job stability in a Austrian/deflationary economy?
Yes. In general, job stability will not be negatively affected in an "Austrian/deflationary" economy.
Either way it doesn't promote employment longevity and job stability. It seems to be the same problem as inflation just in reverse.
I don't know if I did a good job explaining this clearly. Let me restate.
If decreasing prices (deflation) are caused by increasing productivity, then the average worker will deserve the increasing purchasing power his fixed salary provides, and he will never need an actual raise or a pay cut (as long as he remains exactly average).
I would love to post this in the economic section, but... I am a newbie.
The Austrian school of economics says that deflation seems to have a positive effect on everyone and I would tend to agree. Inflationary economics seems to really be bad all around except for the government and central banks. In a In Keynesian/inflationary economics Goods and services tend to go up in price while the wages employees are earning go down in value every year, thus the need for employers to give out standard for living increases. In a Austrian/deflationary economy there would be no need for a standard of living increase as the amount of money they were making on a yearly or hourly basis would increase in its purchasing power each year.
Which brings me to my question:
Would there be job stability in a Austrian/deflationary economy?
I know there would be more jobs available, but It seems there would be no reason for a company to want to keep older employees as they are paying them much more in purchasing power than new employees.
For example: Lets say I, the employer, hired you, the employee, on at 10$ an hour. And for easy math sake lets say there is deflation at 10% a year. So the following year I hire employee number 2, who does the exact same job you do, at 9 dollars an hour. I pay him 9$ because I have adjusted his rate for his 10% deflation. Now lets say this continues for 10 years. As an employer, why would I want to keep you on at 10 dollars an hour when I could fire you, and use your 10 dollars an hour to hire 10 people to replace you at 1 dollar an hour. It seems like deflation would make a standard of living decrease common amongst business.
This is the only problem that I can see in the Austrian way of thinking. And in fairness it seems like a much better problem then having your wage purchasing power stripped away from you every year through inflation. It just doesn't seem to promote longevity in the career of an employee.
Maybe a nice moderator can place this in the economics section for me
The Austrian school of economics says that deflation seems to have a positive effect on everyone and I would tend to agree. Inflationary economics seems to really be bad all around except for the government and central banks. In a In Keynesian/inflationary economics Goods and services tend to go up in price while the wages employees are earning go down in value every year, thus the need for employers to give out standard for living increases. In a Austrian/deflationary economy there would be no need for a standard of living increase as the amount of money they were making on a yearly or hourly basis would increase in its purchasing power each year.
Which brings me to my question:
Would there be job stability in a Austrian/deflationary economy?
I know there would be more jobs available, but It seems there would be no reason for a company to want to keep older employees as they are paying them much more in purchasing power than new employees.
For example: Lets say I, the employer, hired you, the employee, on at 10$ an hour. And for easy math sake lets say there is deflation at 10% a year. So the following year I hire employee number 2, who does the exact same job you do, at 9 dollars an hour. I pay him 9$ because I have adjusted his rate for his 10% deflation. Now lets say this continues for 10 years. As an employer, why would I want to keep you on at 10 dollars an hour when I could fire you, and use your 10 dollars an hour to hire 10 people to replace you at 1 dollar an hour. It seems like deflation would make a standard of living decrease common amongst business.
This is the only problem that I can see in the Austrian way of thinking. And in fairness it seems like a much better problem then having your wage purchasing power stripped away from you every year through inflation. It just doesn't seem to promote longevity in the career of an employee.
Maybe a nice moderator can place this in the economics section for me
I'm not sure how much sense this makes, but here's a stab at it. I will use "price decrease" to mean what OP means by "deflation" because the term "deflation" seems confusingly like the opposite of inflation (an increase in the quantity of money), even though it is typically used to mean a decrease in prices.
If price decrease inversely follows the increase in productivity of all the producers in the economy, then the average producer's continuous increase in productivity will balance the effect of continuous price decrease. Above-average producers will still deserve a raise, and below-average producers will still deserve a pay cut.
In other words, a fixed salary will buy more and more each year, but the average worker will deserve this "raise" because he will increase his productivity each year.
Of course, this makes the assumption that price decrease tracks the increase in productivity of all producers in the economy, an effect which might be dwarfed by other effects, as is the case when a currency is in its infancy and is experiencing price decrease because the currency is rapidly attracting new users.
how is it secure when a miner is using insecure http to send the user and password?
Your miner will be insecure, but that's not a problem as long as you are using a different password for your user account.
If an attacker gets one of your workers' passwords by sniffing your unencrypted HTTP traffic, I think the worst thing he could do is execute a denial of service attack in your name in an attempt to get you banned from your pool.
Leeches like you have no place in a True Free Market, these posts should be bannable.
In a free market, everyone is free to set a price for the goods and services they provide. It does not matter if someone else thinks this price is too high.
You might think that OP isn't providing a service, but some other Bitcoin enthusiast might think differently. He might choose to donate bitcoins to many newbies in an effort to foster widespread adoption of the currency. That Bitcoin benefactor thinks he is receiving something of value, and in a free market he is free to pay whatever he wants for it. Both the seller (beggar) and the buyer (donor) are free to deal as they please.
The danger in barring OP from setting his own price on his own goods and services is simple: later, someone else might use a similar justification to bar an activity you wish to engage in. Imagine someone saying, "Targus, this thing you are trying to sell is worthless! I am offended that you are trying to sell it, and I will lobby for a ban on it!"