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RE: BlockTrades beginning development of Steem Proposal System

in #blocktrades5 years ago (edited)

they (and the Steem community and stakeholders generally) do not benefit from the overvaluation of SBD.

You really need to consult an economic expert.

I'm not saying to stop SBD printing all together. I'm saying return the conservative cut-off to the SBD printing the way it was before HF20. Right now the hair cut is in effect and printing of SBD is reduced to almost nothing. Just recently, the hair-cut temporarily stopped even though the debt ratio was high. This creates too much SBD and soon after causes a conversion of way too much STEEM as the conversion ratio is not 1:1. This creates inflation and pushes us back into hair-cut. It is going to be really difficult to get out of hair-cut. Our economy is going to rely entirely on market pressure to save us just like Steemit Inc relied entirely on market pressure to fund their business. It is not a responsible plan.

I provide you data and you claim that something is wrong with it. If you are not going to believe me no matter what I say, I encourage you to get the data yourself (perhaps from someone you trust like @penguinpablo). Then go to your local college and consult a professor of economics. I'm sure that they would love to entertain an economic discussion. They might even get a student to perform a study on the subject as a project.

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I never said there was anything "wrong" with your data. In fact I explained how your data show a reduction in inflation during the period of high STEEM and SBD price (by downward sloping of the supply curve over a period of several months, even if not immediately visible to the naked eye). Your data is fine, your conclusion of SBD conversions as a "source" of inflation is wrong because you ignore SBD printing as a reduction of inflation. In fact you repeat the exact same error in this last reply.

This isn't a question of whether I believe you or not, the mechanism just does not work the way you claim it does.

Finally, the printing cutoff and printing generally has virtually no effect on getting us out of the haircut, or on the debt ratio generally. That's how the numbers work: It takes almost a year to increase the debt ratio by 1% via 100% printing. Close to the 10% cutoff, this is close to the same effect on the debt ratio as a 10% change in the STEEM price, something which happens frequently within one day. Conclusion: Price changes are very nearly the only factor which affect the debt ratio over moderate time periods (days to months), not printing.

Finally, stopping printing SBD means more STEEM paid out as rewards, and likely more STEEM selling pressure as a result. That's possibly counterproductive, but unlikely to ever be any better than a wash in terms of the haircut or debt ratio.