When you just create more money (coins) you create a Venezuela or Weimar republic.
https://en.wikipedia.org/wiki/Hyperinflation
If you create more coins each coin is worth less until it is worthless.
Craig
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A very interesting discussion!
As long as people believe in a coin, such as the US dollar, the coin keeps a value.
If one calculates the value of the dollar, one has to come to the conclusion that a dollar should have a negative value. But negative compared to what? the Euro, the Yen, the Pound?
If you look at it in this way every coin has only the value of the people who believe in its value.
Steem is valued against the dollar, but that is mostly interesting as long as people believe in the "value" of the dollar. In Europe we have the Euro, the Euro is valued against the dollar, or the other way around, depending on your "home" currency.
It really does'nt matter I guess; money is an invention of humans; show a cat, a monkey or a dog a box with 1 billion dollar in it and see what they value it at!
grtz , @vjbasil
Very well articulated.
As long as people can cash out there steem to buy groceries or video games, they will have faith in it. But if Steem inflates faster than the dollar (or Euro or Yuan), they will buy less groceries, until this discussion is no longer debated.
A tractor trailer load of Zimbabwe dollars wont buy a roll of TP -- so guess what happens.