Good question! I think I'll need to consult the white paper before I can answer. From top of my head, I think STEEM may provide flexibility needed to maintain all the invariants ($1 per SBD and the author/curator rewards).
After all, real companies use a multitude of financial tools too: bonds, stocks, bank loans etc
So the white paper discusses a principle known as the Impossible Trinity in the Setting Price Feeds section:
That might be the reason. If we used SBD to reward authors, we'd want to be able to mint new coins at any time, and the principle says it would be then impossible to maintain the exchange rate. But I'm definitely on thin ice here. Never really understood monetary politics
This seems like a theory from Macro economics. A stable exchange rate would mean no free capital movement and independent monetary policy. If there is freedom of capital movement and independent monetary policy then there will natural fluctuation of exchange rate as per determined by market force.
Developer of #Steemit can manage exchange rate by limiting the supply of Steem payout. This is one example of no free capital movement and an independent monetary policy.
However I do not understand that since no monetary tools are available apart from managing supply/ demand, Steem developer cannot increase nor depreciates the exchange rate through managing the interest rate since Steem power and Steem dollar interest rates are sort of fixed.
Anyone have an idea on this? And what are the tools that Steemit developer can use to manage and maintain a stable exchange rate?