Earlier quoted context omitted.
>We have no evidence to the contrary except the previous mega-crash. >bitcoin being a deflationary uh, no, it's not yet. Masses of new bitcoins are being created every day. That is inflationary (and much more so than USD). @greg_bt: it matters little how you frame it, but the supply of bitcoins is increasing. It will gradually reduce and stop, all of which is predetermined, yes. Today it is inflationary (IIRC its abo…
To be correct, the question of whether a currency is inflationary or deflationary, is a function of both the increase in the supply of the currency, as well as growth in the economy. If the economy is growing faster than the currency, than the currency is deflationary.
There is also the velocity of money, which people tend to forget. MV = PQ is a tautology that tends to be fairly useless in understanding inflation because there's no variable there that is reasonably constant. So other approaches fare better, such as looking at the sources of inflation, e.g. imports, relative labor bargaining power, and aggregate demand vs. supply.