Quantitive Easing is deployed with a goal of increasing inflation sure, but do you disagree inflation is pretty much inherent in any monetary system since the concept of money was deployed? I'm only questioning why anyone would be surprised that over 100 years 1$ buys far less?
I don't get why inflation should be inherent to the monetary system as you say. I don't get why a dollar's purchasing power should decrease over time.
Suppose there was a finite and constant amount of $ (yeah right)
Suppose the population is increasing so the number of economical subjects is increasing.
Suppose the amount of food they need is also increasing.
The amount of $ is finite and constant, but there are more bananas being produced over time. The bananas are still priced in dollars. My logic says that an increasing quantity of bananas will be worth less dollars per banana.
I understand that the argument against deflationary currencies can be summarized like that:
The increasing purchasing power of the dollar would bring people to hoarding dollars instead of cultivating bananas.
This in turn would make the population starve.
Then I say: This in turn would cause bananas to become more valuable, hence their price in dollars would go up again. It seems pretty self regulating to me. With the added bonus that we'd stop producing more bananas than we really need.
s/dollar/bitcoin I think this is what we are trying to do.
Where did I get it wrong?
