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You are pointing to price volatility. The comment is talking about inflation. Price discovery occurs in all markets with varying degrees of volatility. Speculat

You are pointing to price volatility. The comment is talking about inflation. Price discovery occurs in all markets with varying degrees of volatility. Speculative bubbles, crashes, etc result occur when new information causes price discovery. Its an ongoing process in an ever-changing world. Inflation is specifically price increases from change in the amount of money in a system. The delta in money supply for Bitcoin is entirely predictable and that was the claim

notahacker 6y ago
> Inflation is specifically price increases from change in the amount of money in a system. No it isn't. Inflation is a general rise in prices in an economy, period, of which change in the amount of money in circulation is only one possible cause [it can also circulate faster or slower due to change in demand, supply constraints, import prices etc].
- Sschellbach 6y ago
  You have confused monetary inflation and price inflation. I'm talking about monetary inflation as per https://en.wikipedia.org/wiki/Monetary_inflation https://en.wikipedia.org/wiki/Monetary_inflation
  - notahacker 6y ago
    No, people that fixate on low rates of money supply growth whilst their asset halves in value over a very short time period are the ones confusing monetary and price inflation. Price inflation matters; it's what your money pays for in future [and what economists refer to when they say 'inflation]. 'Monetary inflation' matters only inasmuch as it influences price inflation, which turns out to be surprisingly little. The original thread was about benefits. Fixing the money supply growth rate isn't a benefit if your asset's purchasing power drops over 60% in two and a half years. And money supply growing quite considerably turns out not to be a drawback when prices grow predictably and slowly and the system allows for the money supply to contract again if prices overheat.
    - Sschellbach 6y ago
      "Inflation, as this term was always used everywhere and especially in this country, means increasing the quantity of money and bank notes in circulation and the quantity of bank deposits subject to check. But people today use the term `inflation' to refer to the phenomenon that is an inevitable consequence of inflation, that is the tendency of all prices and wage rates to rise. The result of this deplorable confusion is that there is no term left to signify the cause of this rise in prices and wages. There is no longer any word available to signify the phenomenon that has been, up to now, called inflation. . . . As you cannot talk about something that has no name, you cannot fight it. Those who pretend to fight inflation are in fact only fighting what is the inevitable consequence of inflation, rising prices. Their ventures are doomed to failure because they do not attack the root of the evil. They try to keep prices low while firmly committed to a policy of increasing the quantity of money that must necessarily make them soar. As long as this terminological confusion is not entirely wiped out, there cannot be any question of stopping inflation." - Ludwig von Mises Your 60% drop claim is rather vapid considering I could pull any other arbitrary time horizon and give you a massive increase in purchasing power.
      - notahacker 6y ago
        It's a cute quote, but there's a reason modern economists don't conflate labour inputs and value or monetary expansion and price inflation. It's actually much more useful not to use the same words for phenomena when you're studying the degree to which they're related. And more useful to play semantic games when the data unambiguously refutes the argument that fixing one value necessarily holds the other constant, of course... (Getting the term 'inflation' associated primarily with price rises was the one battle Quantity Theorists won.) You are welcome to prefer to use 'inflation' as it was used 100 years ago instead of as it is used now, but 'awful' and 'silly' were compliments once.... > Your 60% drop claim is rather vapid considering I could pull any other arbitrary time horizon and give you a massive increase in purchasing power. No, what is vapid is the pretence that an asset has the advantage of 'zero unexpected inflation' when it's lost purchasing power at a rate which would be termed hyperinflation were it a national currency. It's a bit like defending the validity of immortality elixirs by arguing that over other time frames, the patient survived.

notahacker 6y ago

> Inflation is specifically price increases from change in the amount of money in a system. No it isn't. Inflation is a general rise in prices in an economy, period, of which change in the amount of money in circulation is only one possible cause [it can also circulate faster or slower due to change in demand, supply constraints, import prices etc].

Sschellbach 6y ago
You have confused monetary inflation and price inflation. I'm talking about monetary inflation as per https://en.wikipedia.org/wiki/Monetary_inflation https://en.wikipedia.org/wiki/Monetary_inflation
- notahacker 6y ago
  No, people that fixate on low rates of money supply growth whilst their asset halves in value over a very short time period are the ones confusing monetary and price inflation. Price inflation matters; it's what your money pays for in future [and what economists refer to when they say 'inflation]. 'Monetary inflation' matters only inasmuch as it influences price inflation, which turns out to be surprisingly little. The original thread was about benefits. Fixing the money supply growth rate isn't a benefit if your asset's purchasing power drops over 60% in two and a half years. And money supply growing quite considerably turns out not to be a drawback when prices grow predictably and slowly and the system allows for the money supply to contract again if prices overheat.
  - Sschellbach 6y ago
    "Inflation, as this term was always used everywhere and especially in this country, means increasing the quantity of money and bank notes in circulation and the quantity of bank deposits subject to check. But people today use the term `inflation' to refer to the phenomenon that is an inevitable consequence of inflation, that is the tendency of all prices and wage rates to rise. The result of this deplorable confusion is that there is no term left to signify the cause of this rise in prices and wages. There is no longer any word available to signify the phenomenon that has been, up to now, called inflation. . . . As you cannot talk about something that has no name, you cannot fight it. Those who pretend to fight inflation are in fact only fighting what is the inevitable consequence of inflation, rising prices. Their ventures are doomed to failure because they do not attack the root of the evil. They try to keep prices low while firmly committed to a policy of increasing the quantity of money that must necessarily make them soar. As long as this terminological confusion is not entirely wiped out, there cannot be any question of stopping inflation." - Ludwig von Mises Your 60% drop claim is rather vapid considering I could pull any other arbitrary time horizon and give you a massive increase in purchasing power.
    - notahacker 6y ago
      It's a cute quote, but there's a reason modern economists don't conflate labour inputs and value or monetary expansion and price inflation. It's actually much more useful not to use the same words for phenomena when you're studying the degree to which they're related. And more useful to play semantic games when the data unambiguously refutes the argument that fixing one value necessarily holds the other constant, of course... (Getting the term 'inflation' associated primarily with price rises was the one battle Quantity Theorists won.) You are welcome to prefer to use 'inflation' as it was used 100 years ago instead of as it is used now, but 'awful' and 'silly' were compliments once.... > Your 60% drop claim is rather vapid considering I could pull any other arbitrary time horizon and give you a massive increase in purchasing power. No, what is vapid is the pretence that an asset has the advantage of 'zero unexpected inflation' when it's lost purchasing power at a rate which would be termed hyperinflation were it a national currency. It's a bit like defending the validity of immortality elixirs by arguing that over other time frames, the patient survived.