I don't know if you're doing it deliberately, but in the context, you're kind of doing a motte-and-bailey here...
You need a currency to be "not 1923 Germany", because it becomes impossible to plan for anything past your next meal.
But the "loses 100% of the value per century" doesn't really seem to be a hindrance to our real-world financial needs. Lenders are capable of understanding this risk and extending 30+ year mortgages and even those weird century-plus infrastructure bond products.
The whole long-term stability thing seems to be a very narrow scare tactic: a bugabear for those who are wealthy enough to hold a lot of cash, but too naive/risk-averse/fearful to invest it in any meaningful way o beat inflation.
We are going to have to disagree on this point. To me inflation is taxation without representation. It is theft of purchasing power by Central Banks. It disproportionately negatively affects savers or those on fixed incomes and it benefits those closest to the new spending (read Wall Street Bankers) via the Cantillon Effect.
I am less concerned with the needs of lenders to compensate for inflation than I am worried about the disastrous effect it has on those who wish to save for the future.
I guess, in the end, I see central banks as "indirectly representative". While they have some free hand in day-to-day policy, in the end, their leadership has to answer to elected officials. If they drive the economy into a ditch, the head of the Federal Reserve/Bank of England/ECB will get fired.
So the decisions they make aren't much more "taxation without representation" than when the city sanitation department has the authority to adjust the rates for trash collection. Eventually, there's accountability.
>I am less concerned with the needs of lenders to compensate for inflation than I am worried about the disastrous effect it has on those who wish to save for the future.
The point was more that it's already priced in. Inflation doesn't seem to be hindering us from building projects like railroads or semiconductor fabs where the real payback may be many years after the first cheque is written.
As far as I can tell, the primary loser in a managed-slow-inflation scenario is the person who is saving via the "wad of banknotes under the mattress" strategy or similar equally naive choices (i. e. a main-street bank savings account that pays below the inflation rate).
It's not hard to build a very conservative investment portfolio that beats managed competent-Western-central-bank inflation. Hell, you could just buy something like TIPS or Series I savings bonds and be done with.
From that perspective, it's less "robbing savers of purchasing power" and more about converting savers from "dragons sitting on top of a pile of gold" into actual investors participating in the real economy.
While bitcoin may be volatile in USD over the short term, I can tell you the exact inflation rate of Bitcoin today, tomorrow or 100 years from now. Try that with the US Dollar.
And, to thehappypm's point: Has the US dollar ever lost 30% of its value in a month? No. This point was badly stated (bitcoin has never lost 99% of its value), but I think the point is rather clear: Bitcoin can lose value much more rapidly than the US dollar, and in fact has done so.
