Yes CoinOperated, I do think that it has to be a way to contain either deflation or inflation. A secondary block chain if connected with the main chain would be less appealing to the current speculators and therefore potentially more stable.
Also the ability for some newcomers to mine would encourage more people to enter into bitcoin, expanding its market.

The whole current trend starts to look after the fate of e-Gold, Pecunix or other "most people didn't even heard about" e-currencies.

I just don't see how to set the x:1 proportion with this one, at least at the beginning.

Back on the time when people buy pizza for 10K, I bough cards for nearby values, I don't bother with it, and BTC flowed without much interruption.
Now... as this one gets to this price, BTC is stuck. Nobody can do business with BTC, it's simply impossible. So I feel the need, as a supporter of an economy of goods, not an economy where "money" is the "good", for a more worthless kind of BTC, one that is usable, and this one ain't.
Hard to understand?

I'm thinking of it as a technically separated, the both block chains are independent, with inter-op by human side. So it will be up to the market to say how many silver you need to get a gold. The most important point is to get them together at the user's eyes, means that the client that handles "goldBTC" must also be able to handle "silverBTC".
Having this secondary currency you get some point of stabilization, maybe however not just yet with silver due to the high demand of gold (so some gold investors may move to silver or diverse their investment wallets by put some silver too), but let's say in 1 or 2 years time it's started the bronze block chain and up to this moment you'll have a tertiary and basically stable currency, as the demand for the "bullion" doesn't quite engage this last chain, at least there's no reason for that to happen.
You can always inter-op them by the market, but those two lesser chains being less interesting to the speculators would become expendable exchange, increasing its velocity, whereas BTC (gold) remains as investment and savings.
Not as simple as the currencies as 100 cents = 1 usd I don't believe it would be possible to determinate 100 silver = 1 gold with the same linearity.

Basically is to move part of the real World to BTC reality, you tend to save an 100USD bill, to expend more easily 1 buck and not even to think much about expending 1 quarter.

As for the "gold rush", I didn't missed it and I wouldn't be investing in hard GPU's - nor do I've them, I'm not a miner -, don't bother. Generated some thousands by CPU back on the beginning, up to late July.

As we speak, BTC is under fire again as Mt. Gox is under DDoS... and in this times the lack of a BTC economy turns more evident. As nobody seams able to deal directly with bitcoins, the exchange being down simply "halts" the entire system.

Just an idea... yet it needs something usable.
You don't go buy a coffee with gold nor a car with tin; yet there're more coffees being sold out than cars and within this BTC we only get gold.
I know this moves with the greed of old miners, believing that a secondary line would drop the value of their bitcoins... still, is just a matter of put it in the right perspective to prevent such thing.
And, again, a secondary block chain would give a boost of another "gold rush" for it... maybe shorter than the actual block chain as now there're a lot of miners equipped with top edge GPU, something I don't recall to see last year.

This is the reason Marx was right about the major issue of Capitalism, somehow, or by convenience, some people tend or look to think as "growing to the infinite" as some kind of possibility. Technology doesn't allow it, as it needs resources to be created and after a few cycles you get it heavily inflated.
Therefore we've the cyclic crisis, a "readjustment" on that "growing to the infinite" attempt.

But this leads to other sort of economics, as CoinOperated states rightly, BTC has no economy at all, it's value emanates directly from speculation.
Which lead us to a secondary problem here, we NEED (isn't just a matter of "want") to have or start a BTC based economy, if the current isn't suitable for the purpose, create another chain, have another rules like index it to CAD or USD, force "miners" to backup their coins with some solid currency and leave this one to the only purpose it seams to have so far; trading fiat for bit and vice-versa.
Otherwise, keeping this economy-less currency by trading BTC people is loosing, as it always happens when you trade money for money, and to the end this would end up like any other sort of scheme where you trade money for money.

Wrong concept, Tom, isn't "by produce more" that you cause deflation, could be but rarely (as the planet is already being exhaust of its resources), is by "retraction of consumption" (market has TWO sides, not ONE).
If less money is available, people will consume less, things either get cheaper or in stock, if stocking is possible, you can't stock fresh food for an instance.
This circle generates high losses to all sort of business.

Like I said, Tom, it's a matter of "psychological" maneuvers.
People will get happier with inflation as they get more, even if they make less out of it, than with deflation. And even if deflation would be ok if all prices come down at the same time, the fact is they don't, some will, some won't. Let's say from my previous example you have to pay a rent of 250/mo, will your landlord accept 125? Or he will be asking you the same 250 even if now it worth 500?
Deflation is a cause of social unrest, massive bankruptcy and unemployment and, due to the psychological impact, way worse than inflation.

When thinking about economy, it's a mistake to think just in numbers, as who does business is people, nothing has intrinsic value, people give (or take) value of things, therefore you always need to add people to the equation.

I would oppose the creation of a separate bitcoin if it was out of the bitcoin project, as such will render "two golden cryptocurrencies", but my idea goes around create a lesser-valued bitcoin attached to the already existing one. One more suitable for investment, other more suitable for trading. And here works again the "mind trick", name one gold the other silver would keep "big sharks" away from silver... even thus mathematically they're the very same thing.

Xenland,

When comes to economics, a very large slice of it is psychological. A bit like deflation, it's a nightmare due basically to psychological behaviors not by itself; say you earn 500, your coffee costs 1, at some point your coffee costs 0.5, your boss wants to cut your income to 250, this will alter your state of mind as you, "in your mind", are getting less (regardless you do the same with it or not).

People will never accept any currency they can't aim for the "unit". That's why gold ended up replaced for trade, even before banknotes regular trade was done with mostly bronze coins.
And here we go again, the existence of silver, bronze and other less precious metals didn't hurt gold's value.

You insist to forget one thing, the currency doesn't conduct trade, people does, so prior to "nerd thinking" you've to think on "the people" side.
Nowhere in Earth general population will stick with a currency where you need to go on nanoX or picoY or microZ, so if that's the idea, rather bury bitcoin for business now, as it only business will be to trade btc for fiat currency and back to btc again and to fiat currency...

tom;

Deflation is a "money trick" not quite connected to production. It's a nightmare due specially to its social consequences, obviously BTC is somewhat safe of this due to not be "currency" anywhere. How could you explain to someone you'll pay him less? Will he understand? And if don't, you will bankrupt to pay him the same he's already getting... to the end it causes massive bankruptcy and spikes unemployment. A normal reaction of a government would be to change currency, or its name.
Again... it may not apply to BTC, at least just yet.

xf2_org,

So you imply the whole BTC concept is faulty, as the maximum amount will force people into tiny decimals of an overwhelming expensive currency...

Raulo,

I think those "secondary" bitcoins should be within BTC and not separated, to not spread within several block chains, nor to surpass the actual bitcoin (let's call it Gold Bitcoin for this essay purposes). To "split" we already have namecoin, for an instance.

So the client would look something like this:



Another surplus of this is to get people into bitcoin, as newcomers will be able to generate a few silver coins, much lower in value than gold but enough to get them interested.
From an outside point of view I understand some of my friends when they look at me as sort of a "freeloader" for my early generated coins and their current value...

"People gambling on which takes off"... people is already gambling on it with Bitcoin alone.
Also you "need" USD (if you're on US that is, here it would help you much, as everything goes on Euros) for buy and sell stuff, whatever currency doesn't make you able to buy and sell stuff is an useless currency.
And up to this point, I've to give credit to that guy with carrots, taken you can't buy anything on BTC and you would actually be a foul to attempt to run a business in this currency as you can't know how much it worths - up to last week 1,xx USD, in the week before 0,6x/0,7x USD, now 3.xx USD, some months ago 1.xx, tomorrow ? USD. It's not quite "trending up", it's bumping wildly without consistency. Fiat currencies goes a few pips up, a few pips down, this one bumps from gold to rubbish.
And see here an issue? Everything goes around USD, most (rather say ALL) of us think on USD or EUR or a fiat and stable currency, nobody thinks on BTC.

Deflation ain't never a good thing, unless the currency causing deflation isn't in use at all. Hey! Now you can buy more stuff with less currency. Right... but so you will earn less of that currency. Again, it just doesn't quite "hurt" in BTC because nobody is trading nothing on BTC, everybody is "thinking" on USD.
And I'm speaking somewhat against myself, as I'm one of the BTC "pioneers", I generated several thousands of coins in the beginning.

But back to the beginning, instead of Euro/Amero/Asian... it could be silver BTC/bronze BTC/iron BTC...

Having more World currencies gives us diversity and choice. Have just one renders a monopoly, as now Mt. Gox have for an instance on BTC.
If BTC becomes as bad deal you've no alternative, equivalent to BTC, at the moment, do you?
Stability will be in the interest of those holding or investing in the coins if more BTC-like currencies are available.

Like anything else, currencies also work by the rules of the market and concurrence.

So, tom, with 6 parallel block chains you would end up with 5 times more BTC available, with different values between them is true, as they hadn't start at the same time, but will be more able to be up to BTC demand and therefore stabilization. A bit like what you've on the real world with different currencies.
As things develop, people will tend to stick with the most stable block chain for real life trade and use the more trended up as bullion or investment. Eventually some block chains will fall into darkness as happens to some currencies around, such as Indonesian Rupiah.

OK... let's wait and see... However mind one important issue: Trading money for money is a burning spiral of losses, as nothing is being generated to back it up nothing is fueling the economy. If BTC doesn't stabilize anytime soon, to allow other sort of business to be conducted with it, it will become a slow-burning ponzi scheme to the end.

CDN sounds a nice concept btw.

Running in parallel they manage to stabilize their inter-op prices. So there would be if not BTC, EurBTC, AmerBTC or other to fill the market need for currency, allowing then currencies to stabilize or not so open to speculation floating as a single block chain is.
BTC alone looks like a 3rd world currency, to do business with it you need to be carrying a price tag to change the prices every 5 minutes or so.

Some may think about go to the 4th decimal, to the 8th, however and even if those numbers doesn't affect machine calculation, this is just "the money", "the business" are intended to be operated by humans, not machines, to practical terms it shouldn't go over the second decimal (currency+cents), a currency with lots of units isn't practical.

That's OK... taken 99,9999999999(...)% of the planet still accepts none at all, not even that "longest one". The idea of split block chains must be on the table, it allows BTC to be more resistant and more usable, specially this last feature, as BTC has no use whatsoever.
I'd that one 1btc host that after tomorrow I'll not renewal. The reason? The host is ok for 1UD/mo, but suddenly became way too expensive as it tripled its value due to BTC.

So, how do intend to conduct business with such volatility on the currency?

The idea would be to give it some sense, some "human readable" sense, instead of having Block Chain 1, Block Chain 2(...), as well as some "limitation" on the accepted or recognized chains.

Despite the announced 21 M limit, Bitcoin is limitless. All it can is hold 21 M per block chain, but we can create how many block chains we want.

What this leads to?

Well, for starters to its primarily goal BTC is useless, growing in value so fast it renders a totally useless currency for trading (other than trading BTC themselves). So my believe is that we need more block chains to operate, so we could have:

Universal Bitcoin (the one we already have)
but also:
EuroBitcoin
AmeroBitcoin
AfroBitcoin
AustraloBitcoin
AsianBitcoin

Leaving us with 6 block chains in total. To the very end when this 5 matures we will have 6x21M worthing the same, but as Universal Bitcoin has started first it must hold some value above the remaining 5 at least while there's more UBTC and is harder to generate than any other.