More likely:

Milk = mBTC15
Expensive wine = BTC0.99
Basic Membership = mBTC 1 (let's be realistic about this one)
Silver Membership = mBTC 10
Enterprise Membership = mBTC 10000 (assuming that a 1000x increase is again reasonable)

In the same way:

Milk = 99c
Expensive wine = $99
Basic membership = $1,000
Silver membership = $10,000
Enterprise membership = $10M

The reality is that people deal with different denominations all the time, just not usually at the same time.  If all your groceries are in the mBTC range then they'll all be priced using that range.  In the meantime all of the houses for sale will probably be in the kBTC range so will all be priced in that range.

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Of course, commas and decimal points mean different things in different locales, but that's more of an i18n issue than a knock at picking any particular range to use as a valid level.

I believe that if Bitcoin is going to be successful it is going to need to be at the level where talking about a few XBT is similar to talking about a few dollars/yen/whatever.  But for talking about real values I don't see it being useful for a long time yet.

I do agree with the idea that big numbers are easier to think about than mall fractions.  But like it or not the worth of Bitcoin is compared directly to that of USD and so we're probably looking at appreciation of three orders of magnitude until XBT are used directly.

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From Grau's post:

Although the most sensible solution long-term, it does cause issues with the current exchange rate.  Even the cheapest items will be quoted in hundreds of thousands of XBT, and the exchange rate itself doesn't look quite so appealing when it's 0.000129$/XBT.

I don't see why people can't just use the units that are most appropriate to the denomination.  Use 150mBTC rather than 0.15BTC; use 20MBTC rather than 20000000BTC; use 24XBT (or 24uBTC) rather than 0.000024BTC.  Is it so hard?

As has been mentioned before, the most important thing for you to do is to separate out the amount which you want to store long-term (aka savings) and the amount which you want to use in day-to-day transactions and treat them separately.  For the latter a simple encrypted wallet is probably the right balance of security and convenience with possibly a hardware key in the near future as they become more stable.  For the former you need to do everything you can to keep your private keys away from others.

If you boot a live CD/USB distribution on to a computer not connected to the internet and generate your keypairs there it's a good first step, then you need to take whatever measures you feel appropriate to manage your private keys.  This can be any combination of encryption, cold storage, obfuscation etc. but remember that you do need to be able to get them back (and if you want your next-of-kin to be able to access your bitcoins in the event of an unfortunate meteor strike then you need to ensure that they can carry out the same procedures as you).

It really depends on how stable Bitcoin becomes as a world currency.  The whole 1BTC now == 60BTC later thing might look right now, but at some point I'd hope that the BTC:USD price would stabilize, either because BTC becomes big enough that the daily purchases and sales don't affect the price that much (more likely) or because governments drop their own currency in favour of BTC so there is no continual rebasing required (very unlikely but wouldn't it be nice?)

You're not printing out bitcoins, you're printing out the keys to your bitcoins.

Think of the bitcoin system as a large vault filled with safety deposit boxes.  Each safety deposit box has an address; that's your bitcoin address (also known as public key).  Each safety deposit box also has an entry code: that's your private key.

When you create a paper wallet all you're doing is taking your public and private keys and writing them down.  The bitcoins stay where they've always been.

Thanks for the answer; I'm curious as to if there is any way in which additional information can be added to the transaction prior to signature generation, to allow for a challenge/response from the recipient?

No, because in a BTC only world you wouldn't be continually linking your BTC back to the price of the USD, as people do nowadays.  *That* is the true shift which needs to occur, and that is when Bitcoin will start to be truly interesting.

millicoins seems least painful so far...

This is a big part of it.  Bitcoin is finding its level, and it's at the beginning of a pretty long journey.  There is going to be a lot of pushing and shoving going on before it does so, with governments, asset holders and many others all weighing in and attempting to influence the outcome.

Will be an interesting, if not necessarily fun, ride.

For a given transaction, how can I prove that I was the originator?

Given that I hold the private key of the originator for a given transaction, can I produce some sort of signature after the fact that proves this, or would I have to originate an additional transaction to provide proof?