would it also be + the GDP too?

(in this case I mean GDP as far as what's inside the bitcoin economy)

if the GDP increases by 3 % and dollars inflate by 3% then bitcoin would have to deflate by 6% right?

Without even going into detail critiquing this..... is it really wise to judge a currency that could last hundreds or thousands of years on a small window of time where it is still being 'born' basically?

in my mind... Houses and property are what could really help bitcoin the most. If the people who are seeing their bitcoins increase in value to such an extent that they want to either reduce risk or buy something with them they can do both by buying an entire house. This would spread bitcoin to more people and it would prevent bubbles on exchanges because it would be an off exchange transaction. I think it would smooth out the entire economy.

the annual rate of deflation?

I guess I should clarify: In relation to the dollar. Obviously the dollar inflates at least 3 % or something per year. So that means bitcoin would appear to at least deflate 3% per year (not including growth) right?

that's my thinking

galts gulch accepts bitcoins http://galtsgulchchile.com/

I think something like that inside knowledge is possible. What if google was working on incorporating bitcoin into their wallet for instance somehow?

I think the price rise though is simply from a standpoint of this... there are 11 million coins. Lots of people know about bitcoin now and know the price of each coin could get very high. For instance only 10 thousand people at the moment in the entire world can acquire 1100 bitcoins.. and that doesn't even count the ones that are lost or simply not for sale. A lot more than 10 thousand people want those bitcoins.

so is that a hooker? Or just a girl with a bladder problem who REALLY didn't want to pee on her ugg boots

just wondering if a project is successful with bitcoin it would be easy to reimburse people. Just send funds back to the public addresses that sent them.

That's why I think bitcoins #1 use will be as a hedge against inflation

do you mean alt chains?

I'd have to agree. Even the dollar would have massive swings in value if the proportion of people using it was changing at a rate such as the userbase of bitcoin is changing.

so for transactions of small value... when will there be a microprocessor that takes them totally off the block chain? users might put a small amount of coin there and from it they can spend to multiple places around the net with instant confirms and maybe less fees?

the deflationary aspect of bitcoin is absolutely necessary. It's what causes this "greed" and speculation. But it also solves the chicken and egg problem of money. How can money be born from nothing and serve to act as money when nobody uses it? Nobody uses it because it's valueless... and it's valueless because nobody uses it. So why would anybody use it when it is worth nothing? The deflationary aspect gives a first cause to use it... because whoever uses it earlier will be rewarded so in a way that gives it an automatic perceived value to some people... which gets things rolling.

like it or not a higher price helps bitcoin

Okay let me clarify. There are some taxes that will be easily avoided with bitcoins... and some that won't. This is good. It means bitcoin can cooperate with the government.


First lets give an example of what taxes you can mostly avoid with bitcoins: Death tax might be easier since you can just send unknown funds to relatives. Inflation tax. Right now a lot of money is printed to finance the government. With bitcoins this inflation tax is somewhat mitigated(your salary is still affected and such)


But here is where things won't change. Already it's up to companies to collect taxes. Just because cash is "anonymous" doesn't somehow mean when you walk into a store and pay with cash they won't charge you taxes on that. They would get caught easily. So in the future if bitcoins are accepted at companies they will charge tax just like dollars.  Currently online transactions require the individual to report the tax purchases... so this doesn't change anything. If they someday require companies to collect taxes from people and try to kill internet trade.... well then you will be paying taxes with bitcoins too. If a company decides to pay you a salary then they will also report it and comply with laws because they will get caught if they don't.

In fact bitcoin might even make it easier for the government to do certain things. Imagine if they said to a company to use a certain public bitcoin address for their revenue? It would be completely transparent. They could watch transaction and verify and audit everything so easily it's not even funny.

Property taxes are another example of one you aren't going to avoid with bitcoin. They will still be there.

So thoughts?

One strategy I think is good........ invest half of what you might invest into bitcoins. If the price drops and it is a bubble then invest the other half. If it can go to this high of a price once it can again. If it doesn't drop but just keeps going up you also win.

I follow a similar line of thinking. But I would add maybe 2 more.

I believe "humanure" would go a long way improve the world. It completes the circle of nature since what we eat takes from the soil and we should be giving back to the soil. The health of the soil is vastly underrated.

One other thing... I think Tesla was amazing but there was this other guy named Viktor Schauberger. "the water wizard". I think some of his ideas might help the world.

Even in a best case scenario I won't have enough money to do what I want.. but I may be able to at least help in some way. I would try to use some money to finance the engine my father designed. It can also be used as a generator and so since a generator doesn't involve a transmission it should be easier than trying to first attempt to put it in cars. There is also a huge market in india for portable power generation since they don't have infrastructure. This would help the world since the engine is very efficient.

    What happens when person A wants bitcoins and buys them from person B with dollars? The dollars transfer to person B. They don't disappear. There is no decrease or increase in the amount of dollars in the economy. They simply change hands. You can't possibly know if person A wants bitcoins so they can spend them or save them. And you can't possibly know if person B is selling his bitcoins to use that money for saving such as buying gold.. or if they want to spend them. But if someone spends bitcoins and consumes goods and services from the economy then the supply of goods and services is slightly reduced meaning the same amount of dollars are chasing less goods and services.

    Of course you may be wondering.... if economists claim that deflation is bad for the economy then how is this possible? Essentially economists are automatically wrong because they don't comprehend reality. In reality... there isn't just a deflationary currency (bitcoin). There are dollars and now there are dollars and bitcoins. So how bitcoins will impact the economy (even though bitcoins themselves are deflationary) will most likely be to contribute some small amount of inflation. Will the dollar die and the bitcoin replace it? No because we are forced to use dollars. Government is force. Laws are force. You are forced to accept dollars so by definition as long as there is government there are dollars.