The OP's definition is consistent with the Austrian view:
http://en.wikipedia.org/wiki/Monetary_inflation
Topic: Bitcoin inflation now is 44% per year - page 2. (Read 3684 times)
Inflation rate is measured by change in the price level over time.
The '44%' you are measuring is the growth rate of the money supply.
Trends since Jan 1st are extremely rapid deflation coupled with rapid growth in the money supply.
Deflation since Jan 1st is due to growth in demand for Bitcoin as a store of value (speculators) and to a much lesser extent as an exchange medium (consumers purchasing from BTC stores).
To avoid future embarrassments, look up definitions of economic terms on wikipedia or in an introductory economics text.
The '44%' you are measuring is the growth rate of the money supply.
Trends since Jan 1st are extremely rapid deflation coupled with rapid growth in the money supply.
Deflation since Jan 1st is due to growth in demand for Bitcoin as a store of value (speculators) and to a much lesser extent as an exchange medium (consumers purchasing from BTC stores).
To avoid future embarrassments, look up definitions of economic terms on wikipedia or in an introductory economics text.
http://en.wikipedia.org/wiki/Inflation
In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time. When the general price level rises, each unit of currency buys fewer goods and services.
I didn't go through the best K-12 school in the world, but I think in 6th grade I learned what inflation was for the first time. For there to be a 44% inflation rate, the general cost of goods and services would have to decrease by 44%, relative to the bitcoin. ....
Move this thread to the econ. section or delete it pls
In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time. When the general price level rises, each unit of currency buys fewer goods and services.
I didn't go through the best K-12 school in the world, but I think in 6th grade I learned what inflation was for the first time. For there to be a 44% inflation rate, the general cost of goods and services would have to decrease by 44%, relative to the bitcoin. ....
Move this thread to the econ. section or delete it pls
The bitcoin economy includes the exchanges, you can't pretend that the exchanges are something "outside the economy". Money transfer is one of the services bitcoins provide, and that is facilitated in the exchanges. Considering that mt gox traded about $600,000 yesterday, I'd say that the bitcoin economy it is a little larger than $100K a year.
good point, you might get some demand from there. i.e. 400k BTC are apparently tied up in MtGox for trading purposes.
if that increases, it offsets the inflation a little. how does it increase? by more speculation.
YES entirely true - if there is no bitcoin price appreciation/depreciation. Bitcoin price appreciation/depreciation will give you an indication of how many new goods/services/other are added/subtracted for trade with bitcoin (if you also account for your calculated inflation by first subtracting that from bitcoin price appreciation/depreciation).
Bitcoin price appreciation/depreciation was not 0% for the past year - so you would need to account for that - unless you expect a 0% appreciation/depreciation in price for the next year. But then you would have to use the average number of bitcoins that will be in existence for the year to come - and that will be a higher number, bringing your 44% slightly down (again if there is no bitcoin price appreciation/depreciation).
Bitcoin price appreciation/depreciation was not 0% for the past year - so you would need to account for that - unless you expect a 0% appreciation/depreciation in price for the next year. But then you would have to use the average number of bitcoins that will be in existence for the year to come - and that will be a higher number, bringing your 44% slightly down (again if there is no bitcoin price appreciation/depreciation).
you mean bitcoin supply increases by 44% a year. It's only 44% inflation if bitcoin economy does not grow, but chances are, bitcoin economy is growing faster than 44%, so it's actually a deflation of a x%.
you mean the bitcoin economy, which is now maybe at 100 k$ a year, grows by 40% to 140k$ a year and therefore offsets monetary inflation in bitcoins valued at 53 million $ (margin price)?
IF this kind of monetary inflation is offset, it is by speculation. either by new money coming in, or by miners speculating on even higher selling prices.
IF.
The bitcoin economy includes the exchanges, you can't pretend that the exchanges are something "outside the economy". Money transfer is one of the services bitcoins provide, and that is facilitated in the exchanges. Considering that mt gox traded about $600,000 yesterday, I'd say that the bitcoin economy it is a little larger than $100K a year.
you mean bitcoin supply increases by 44% a year. It's only 44% inflation if bitcoin economy does not grow, but chances are, bitcoin economy is growing faster than 44%, so it's actually a deflation of a x%.
you mean the bitcoin economy, which is now maybe at 100 k$ a year, grows by 40% to 140k$ a year and therefore offsets monetary inflation in bitcoins valued at 53 million $ (margin price)?
IF this kind of monetary inflation is offset, it is by speculation. either by new money coming in, or by miners speculating on even higher selling prices.
IF.
I mean if prices can weather such inflation rate than we doing fucking good!
yep. around 40% for the next 1.5 years.
and around 20% each year (->exponential) if you take the average over the next 5 years.
and around 20% each year (->exponential) if you take the average over the next 5 years.
Did you know that Bitcoin currently has 43.999281216541% inflation rate..
161 blocks per 24 hour x 365 days x 50 BTC per block / 6,677,950 BTC total mined
161 blocks per 24 hour x 365 days x 50 BTC per block / 6,677,950 BTC total mined
Yep, but it is temporary, inflation will decrease to about 15% around 2012, and then 5% around 2016. By 2020 it'll be less then most fiat currency, approching 0.
you mean bitcoin supply increases by 44% a year. It's only 44% inflation if bitcoin economy does not grow, but chances are, bitcoin economy is growing faster than 44%, so it's actually a deflation of a x%.
Did you know that Bitcoin currently has 43.999281216541% inflation rate..
161 blocks per 24 hour x 365 days x 50 BTC per block / 6,677,950 BTC total mined
161 blocks per 24 hour x 365 days x 50 BTC per block / 6,677,950 BTC total mined
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