I should have clarified.  I meant that price inflation is not discussed, as anything other than a side effect, by professionals in the field of economics.  You speak of professionals in the field of governance.  In other words, professional liars.  You should be more careful about whom you listen to.

You're just reaching.  In any economic sense, monetary inflation is the topic of discussion.  Price inflation is an economic illusion, and one not discussed by professionals in the field.  Also, he did explicitly ask about how it starts, not the results.  Again, the cause is always and everywhere due to expansion of the monetary base.  Price inflation cannot cause itself. 

Considering the OP was asking for an economic explaination of inflation; the minor fact that most laymen think of price inflation when the word "inflation" is mentioned is entirely irrelevant.  The OP set the context.  Try and keep up, okay?  We won't be stopping the bus if you fall off again.

While his explaination is flawed, his understanding of what inflation actually is may not be.  A rise in the general price index is a symptom of inflation.  The cause of inflation, and therefore what inflation actually is, is the expansion of the monetary base in excess of the economic/population/general growth rate.  Take your pick.

 

Really?  No comments at all?

The ACA has a clause that prohibits the insurance companies from pointing out the root causes of problems.  They can be fined for even posting complaints on facebook, and they cant' even complain about that clause.

http://www.penny-arcade.com/comic

I think they actually did a fair job.

I did, just not by name.  What do you think velocity measures?

I mean that is was lucky that he called it so close, not that he called it at all.  It's easy to make predictions if you don't have a time frame.  He did.  That's the part that was lucky.

Lucky guess.

This part isn't true.  It was his baby, he kept the coins.  In fact, I remember an event wherein someone on the forum offered Satoshi $50 per btc for as many of the genesis block coins as he was willing to sell.  The response was along the lines of, 'No thanks, those are for my son.'

Furthermore, there was some speculation as to whether or not Satoshi could actually spend the genesis block coins.  The view being that, since the genesis block is actually unique, some clients might choke on the attempt to deal with verification of such a transaction; and that it wasn't worth the risk of a blockchain fork.  Since those early blocks still have never moved, it's also possible that those early keys have been lost or that Satoshi is dead.

EDIT: at the time, the market price for a single bitcoin was about a nickel.

Ah, I see.


I've never made the claim that courts won't attempt to recover stolen value.  I also know, for a fact, that my own coins have never touched any exchange since at least October of 2010.


It might, actually, but that won't be because of some inherent flaw of bitcoin or it's protocol.  Bad image isssues are more difficult to argue against.

I'm missing something.  Why is it wise to trade out for new coins?

Inflation occurs because of expansion of the monetary base relative to it's demand.  What's really happening is that economic growth increases the demand for money/currency, and central banks respond by over-producing.  A cynical person might call that and excuse for bad behavior.  But the central bank expansion is only part of the picture, the other part is the increase in credit issuance.  Fractional Reserve banking permits banks to increase the monetary base temporarily by the creation of new loans without significant reserves.  Said another way, banks no longer need to have deposits in order to make loans, so the interest that the debtor is paying is "new money".  This creates the pressure to create more currency, because the dollars to cover that interest doesn't yet exist.  This is the currency demand that the central bank will eventually use to justify over-production of currency.  However, not all such currency demand is artificial; some occurs due to very natural causes of a growing population and/or economy.  It's impossible to separate the real from the false.  Since this is an ongoing process, inflation is as well; but there can still be short term deflationary events whenever the economy isn't strong enough to support the credit creation, and thus such new loan originations decline.  Therefore, declining credit can also temporarily contradict central bank expansion.

Honestly, so am I.

They stated things they claim are facts.  That doesn't change the reality of the matter at all.  Yes, I really think the Winklevi lawyers made that up and that the SEC & their own lawyers are too stupid to see it.  They very much want to believe that Bitcoin can be regulated.  They know nothing of merit about cryptography, programming, decentralization or (for that matter) even economics.  They are lawyers; nothing more, nothing less.  If the Winklevi can make up convincing bullshit, let them.  It might work or it might not.  I don't care.  Unlike the both of you, I actually DO understand cryptography, economics and the Bitcoin protocol.

Count me as one of those world class simps.  Gavin doesn't have any more influence than we give him.  Just ask MtGOX, who chose to ignore Gavin's rational pleas to fix the mallibility bug in 2011.  As that inicident should point out; even when it's a good idea, and the fix is available, no one must comply.

For good for for bad, Gavin does not control Bitcoin.  He can only make recommendations, and he must justify those recommendations.  Granted, he has more sway with the base than you or I, but if he's not convincing changes don't occur.  Even if he's willing to make those changes himself.

The Winklevi are trying very hard to convince the feds that Bitcoin is as controlable as they wish it to be, and that they can help them do it.

No, they don't.  They have almost as much say in the protocol as you do.