I thought that the reason why steem_per_mvests is increasing, is because every day new STEEM is created for:
- rewards pool for content creators (today that is 44,825 STEEM)
- witness/mining rewards
- liquidity rewards (currently disabled)
To counter all this inflation, 90% of the inflation is offset by growing steem-mvest ratio. So the dilution to the stakeholders is only 10% of whatever yearly inflation rate for Steem is (upto max 50%).
Thus, you could not live off your SP while powering down. You would have to put that SP to work via curation to offset for dilution.
Please anyone correct me if I'm wrong.
whatever the reason it is increasing, if it is increasing faster than the powerdown 1/104, then you will accumulate more STEEM power (while your Mv is dropping), but it does seem that if the powerdown is liquidating everything after 104 weeks it wont work. so to achieve the stated effect, I think you would need to powerdown for 8 days, cancel it and powerdown again to recalibrate the 1/104 to the new total
At the moment the inflation rate for steem is about 300% from what I understand. I think it's supposed to be like that for around 1 year and will decrease slowly after that. I think this will affect how much you get when powering down compared to how much it increases.
Steem power isnt a thing. Its an estimate of the steem value of the vests youre holding.
You're not powering down steem, you're powering down vests... and the value of the vests is increasing. Because of that, your weekly powerdown will increase... If i understand the way the growth works, your last payment should be approximately 3.5 times larger than your first one.
IE, if you have 104M vests, and start a power down, youll power down 1M vests a week. Assuming you make no additional vests, you will have zero vests at the end of 104 weeks.... The increasing exchange rate will just make your weekly steem payments increase.
If youre interested, here are a couple posts i wrote about how vests, steem, etc interrelate.
https://steemit.com/interest/@sigmajin/understanding-the-steem-economic-system-vests-sbd-steem-dilution-interest-and-all-those-crazy-things
https://steemit.com/economics/@chiefjay/where-does-the-money-come-from-part-2-of-my-steem-economic-model
yes, this is my understanding and what I wrote
In the long term this is correct. It is unlikely you will be able to live off of SP-generated income indefinitely. But as long as adoption and speculative demand is increasing, the value increase of SP should more than offset the inflation. Also, 10% is only the maximum and the actual rate depends on the liquid STEEM supply. Finally, as long as liquidity rewards are disabled (or reduced), the maximum is actually lower. Liquidity rewards account for about 25% of the total inflation rate.
@jt777 you realy input 100 BTC to steemit? :3
yes, between the STEEM and SBD I already purchased for my jl777 account and the taker market maker, plus a bunch still on polo that I transfer daily
Now I don't feel so good about how little SP I bought. Definitely agree about being bullish on SP, albeit for different reasons.
avoid fomo, you can just dollar cost average and accumulate STEEM -> SP
this is a marathon, not about this week or even month, the long term is what is needed
Thanks jl777 for the article and thanks furion for explaining the reason :)
That is my understanding. You get more SP over time to offset inflation, but that inflation also drives the price down (more supply = lower prices). Without new demand, I'd expect these to offset each other for the most part.
That means the only way to gain here is to curate or post (grow your SP above the inflation rate) or hope demand increases and drives the price of SP up so the SP you have gains in value.
inflation ...(more supply = lower prices) . not really ever, but especially in this case not really.
Because even if what you think you know about money supply and inflation was true (spoiler alert. its not), its only true all other things being equal.
Trying to explain a shift in price based on a delta in the money supply in this situation is like trying to use the Coriolis effect to explain why your toilet flushes a certain way. There are simply more proximate forcces driving the price.