Transaction

j"1LAnZuoQdcKCkpDBKQMCgziGMoPC4VQUckM<div class="post">Nothing to sweat people. &nbsp;Nobody ever died of a 'deflationary spiral.' &nbsp;<img alt="Smiley" border="0" src="/static/img/emoticons/smiley.gif"/> &nbsp;I agree with "I-am-not-anonymous." &nbsp;The market will choose the best bitcoin-like currency. &nbsp;I happen to believe, however, that the rules that Satoshi has founded bitcoin on will be more than adequate for the future of a thriving bitcoin economy. &nbsp;<br/><br/>Everybody knows exactly how fast the supply of bitcoins will grow: it's set in stone in the rules of the programming and the bitcoin network. &nbsp;While it's true that there is not a currently existing fully-fleshed out market to truly price bitcoins, such markets and exchanges are being developed. &nbsp;As far as future would-be bitcoin generators are concerned, the question is not how much will he "demand....to compensate for his costs." &nbsp;The question he'll be asking himself is "given current market values and my ability to utilize electricity and CPU resources, is it worth it for me to generate bitcoins?" &nbsp;If the answer is yes, he participates. &nbsp;If it's no, he stops trying to mine for bitcoins and focuses on trading tangible assets with bitcoins serving as an appropriate intermediary. &nbsp;If he's not sure, he tries his hand at it for a while and then makes a final decision.<br/><br/>The number of nodes and associated computational cpu power will be in flux, and that competitive flux will allow for costs to approximate value (not the other way around.) &nbsp;Value being set by the markets and the demand for use of bitcoin as a trade intermediary (a money). &nbsp;In the far future, the competition of transaction costs will play a more important role for the would-be node operator.<br/><br/>Contrary to the paradox of thrift argument you present, collecting bitcoins and saving them with hopes of earning purchasing power through deflation is not a bad thing. &nbsp;It will allow for the pooling of bitcoin capital and make purchases of larger capital investments possible. &nbsp;In the future, there might even be bitcoin banks that lend out saved bitcoins with market-set interest rates, thereby diminishing the effects of hoarding. &nbsp;All this wonderful saving, however, comes at a price: delayed gratification of present desires. &nbsp;From the perspective of the would-be saver, the question will always be denying present desires to purchase real tangible assets now versus the future possibilities of purchasing more later. &nbsp;This time preference naturally varies with people and in different circumstances. <br/><br/>Given the fact that bitcoins are by their electronic nature easily divisible, prices will be able to easily adjust to deflationary pressures. &nbsp;If too many are saving, prices will fall and the rate of interest will go down. &nbsp;This encourages demand (lower prices) and decreases the desire to save (less interest). <br/><br/>XC</div> text/html