The simple fact is deflationary currency econnomically incentiveses saving rather than spending which is terrible long term.
Inflationary currencies obviously do the opposite and incentivise spending and creating debt.
You omitted "creating debt ... which is terrible long term."
But I object to your "simple fact". Saving is capital formation. Deflation eases capital formation. Without capital, enterprise is impossible. Spending does not contribute to capital formation. Encouraging spending is no better for the economy than smoking cocaine is good for your energy levels. Well, yes, smoking cocaine will perk you up a bit, but it's not a sustainable gain. Sustainable gains come from healthy habits. Like careful investment. Not desperate investment, chasing yield to recoup inflationary bleed. That;s just chasing crack with heroin.
Deflation has a bad name because people confuse different kinds of deflation. Deflation of the size of the economy, deflation of the size of the money supply, deflation of the scale of the prices. These three are econometric observables. They sometimes correlate, and sometimes anticorrelate -- it depends on the cyclic and secular phase, the expansion/contraction regime, the point in technology and social cycles, &c. We tend to over-weight recent evidence, but economic history is very long. The great depression is the Keynesian poster-child, but the data is abused to support the thesis. In reality, the cycle-bust depression was over by 1932, but then Roosevelt basically destroyed the U.S. economy by seizing the gold and creating a huge centrally planned welfare state. The U.S. had to basically destroy the rest of the developed world in order to become competitive again. The Roosevelt inflation correlated with the economic contraction of the great depression.
I claim that savings encouraged by deflation leads to capital formation which leads to investment, which leads to spending. Savings leads to wealth effect which leads to spending which leads to profits on investments made to supply that demand. Saving is good, period. People who complain about saving are just trying to take other people's money away. Like any thief, their words should be regarded with great skepticism.
But the fact is that all inflationary crypto dies. No one wants it. Without a gun put to their head, no one will take inflationary money if there is any viable alternative. Demurrage only works under duress.
I just wish the neo-Keynesian lies would die. But, there are times when a stimulant is very helpful to the function of an organism. In this much, they are certainly correct. Tiny successes only cause their broken ideology to gain more power, until the long-term effects of their policy prescriptions make themselves felt, and we all suffer, for a long long time to come. It's like a car with only a gas pedal, and no brakes. Nobody ever wants a proper anti-cyclic policy measure, because everyone is after free money. Keynesian economics are pump & dump economics. Perfect for 4 year election cycles.
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