Because that would make it less usable. The Ctrl-C clipboard is meant for more permanent data, while the mouse selection is more transient (it changes whenever you select anything, even if you didn't want to paste it elsewhere). If you unified the clipboards, for example, then you couldn't copy something, select something else, and then paste to replace the selection.

You probably don't notice this problem with PuTTY because it's the only program updating the clipboard on mouse selection, and the only reason to select anything in PuTTY is to copy it to the clipboard. It might make sense to do the same in Konsole, though, or in other terminal emulators.

Actually I wasn't saying anything about taking more risk. The argument was that currency inflation incents people to make investments (even low-risk investments) which appear to be profitable, but are actually below average and reduce economic output rather than contributing to growth. It's really no different than the argument commonly used against price deflation, that it prevents people from investing by raising the minimum return necessary for an investment to be better than saving your money and letting it appreciate. I agree with this argument, by the way. I simply hold that when the price deflation is natural rather than forced, saving the money is in fact the better choice, not just for the individual investor but for society as a whole. The same is true for natural price inflation. The problems associated with price deflation are really symptoms of currency deflation, which incents people to forgo good investments, just as currency inflation leads people to make bad investments. Monetary policy is just like any other subsidy or tax in this regard; whether you're encouraging spending and investment or discouraging it, you're moving it away from the optimal point determined through the market and causing either too much (inflation/malinvestment) or too little (deflation/underinvestment).

That's never the best deal you can get, because in the absence of price inflation or deflation you can stuff your money in a mattress and get a guaranteed 0% real return. That's better than the other case where the best you can get, risk-free, is really -1%.

The really interesting case doesn't even involve negative returns; that's the one where price inflation and currency inflation are not at the same rate. For example, if technological progress and/or improvements in economic efficiency would naturally lower prices by 2%, but there is a 5% increase in the currency supply over the same period. The net result is 3% price inflation, but an investment with a 5% nominal return, while higher than price inflation, is really a malinvestment because it's not producing any real improvement on the resources consumed—the 5% is entirely due to currency inflation—in a time where the average investment is giving 2% real returns. The 2% increase in purchasing power is due to other investments which led to a general improvement in the state of the economy, not that particular investment, which is dragging down the average. It would be better to save the money and not spend scarce resources on below-average investments, but the currency inflation makes that a losing strategy.

True, but as you point out, you can choose between buying a good now and buying it a year from now. To predict the future price you need to be able to analyze past prices and understand the reasons for the changes.

The market only factors in price inflation. You're still left with malinvestments which looked profitable on paper, even after factoring in price inflation, but are actually net losses because they are below the average real rate of return and draw resources away from other, more profitable ventures. Yes, investors should be looking to get the highest possible return for their money, but not everyone can find above-average investments, and for those who can't, inflation leads them to invest somewhere to avoid the inflationary loss even if the economy would be better off with them simply holding on to their money.

True, but only if you're talking about the actual payoff after the fact rather than the expected payoff prior to investing, and it's the latter which determines whether or not you choose to invest. Changes in the money supply affect all investments near the margin, whether low risk or high risk.

Yes, that was one of the original arguments for inflation. It was an underhanded trick to begin with, playing on the average worker's supposed ignorance of basic economics to fool them into accepting lower pay than they thought they'd been promised. Well, that only works so long as your employees remain ignorant of inflation, which is a necessarily transient state. The workers figured out this little scheme and fought back by demanding inflation-indexed wages.

No, the mechanism for continuing is already built in: transaction fees. In addition to the reward for solving a block, the miner gets a small fee (determined by the sender) for each transaction. Miners will continue mining even as the block rewards fall to zero because they'll get paid out of existing BTC for processing the transactions. Also, the difficulty doesn't increase exponentially on its own, it's determined by the time between blocks, which in turn depends on how how much computing capacity is thrown at the problem. Arguably the "carbon footprint" problem, if there is one, is due to the block reward being way too high right now. As transaction fees become more dominant they will eventually provide a more flexible way of encouraging just the right amount of mining necessary to secure the network.

Given a constant currency supply, changes in the prices of goods are indicative of the relationship between the good's supply and demand. When the currency supply increases or decreases, however, that affects the prices of goods independently of their supply and demand, which has implications for comparing prices over time, making the currency less suitable as a unit of account. You can try to compensate with something like CPI, but the CPI only looks at changes in price and doesn't distinguish between changes due to currency inflation or deflation and changes due other factors which affect the entire economy, such as taxes or transportation costs. If you compare the price of a good from ten years ago with its price today, you can see whether it costs more or less, but even after adjusting based on the CPI you don't know whether production of the good is more or less efficient than it used to be. If the adjusted price increased by 5%, is that because it costs 5% more to make the same good or because it costs 5% less, but there's 10% more money in circulation? Without knowing the actual change in the supply of currency there's no way to be sure.

The other digital systems are all centralized and subject to the whims of a particular service provider and/or the government it operates under, and to use a commodity like gold directly you need to actually store and transfer matter, not just bits. Bitcoin is the first system to combine the best of both worlds, a global and decentralized form of electronic money.

Sure, it couldn't keep up with the desire of every government ever to raise money by debasing its money supply. That's not exactly a ringing endorsement of the practice. It's good for the issuer of the money (until people lose trust and you get hyperdeflation); that doesn't mean it's good for the people who need to actually use the money.

I agree. There are plenty of units to go around. One thing I've always wondered, though, is why there are only eight digits. It's a 64-bit integer, right? That would allow for 2.1e18 units, or 21 million BTC to 18 significant digits, 11 of them after the decimal. What happened to the other three?

If you earn money and simply sit on it, then you're not receiving any goods or services in exchange for what you've produced. In the mean time, others gets to enjoy the proceeds from that production. In effect, you've made them a loan of your purchasing power; the increase in value is merely the interest on that loan. It's certainly better than making sub-par investments with returns below the rate of deflation, which would slow economic growth. If you are competent at spotting the investments with above-average returns then you would still invest in them to get an even better return despite the deflation.

If history is any guide, under deflation wages increase faster than prices, so while the real value of the mortgage is indeed increasing, its value as a fraction of your paycheck is decreasing. Inflation has the opposite effect.

You've got that backwards—or rather, sideways. The axis to look at is not inflation vs. deflation, but rather the degree to which the currency supply is manipulated. A monetary policy which causes deflation (or reduces inflation) by reducing the money supply discourages good investments and thus destroys wealth. A monetary policy which causes inflation (or reduces deflation) by increasing the money supply encourages malinvestment and thus destroys wealth. A neutral monetary policy (i.e. a fixed money supply), regardless of the rate of inflation or deflation, encourages good investments while discouraging malinvestment, and thus creates wealth.

On the contrary, it can help the economy. If you want to grow the economy sustainably (and not just boost short-term metrics) then you need to expand its productive capacity through capital investment. You can't do that if everyone is focused on immediate consumption, so the first thing is to convince people to hold back on consumption and start saving instead. Deflation has that effect.

Once people have started saving, they can either hold onto the money or invest it somewhere. If they choose to hold onto the money, they may not be going out and actively picking profitable ventures, but neither are they using up any of the surplus production that money represents. Their "hoarded" money isn't competing with others' money for goods and services, which makes others' money that much more valuable. You can think of that as a sort of general loan, not of money per se but of purchasing power, part of which will go toward consumption and part of which will go toward investment. The portion of the decrease in prices (deflation) which results from those investments is the interest on the loan.

The interesting thing about a deflationary currency is the potential investments with nominal returns less than the rate of deflation, i.e. those which would naively seem to be profitable if it weren't for the deflation. If the change in prices is due to a policy of reducing the currency supply or a sudden, unexpected change in the demand for cash, that could be an issue, but when the deflation reflects changes in the natural price of money in the market—changes in the supply of goods and services relative to the (fixed) supply of money—then any investment which fails to beat the rate of inflation is a subpar investment, and would reduce economic growth, not increase it. The investments which don't take place due to inflation shouldn't take place, because they take productive capacity away from more profitable investments, even if the alternative is simply "hoarding".

If the deflation does happen to be due to a change in the demand for money, rather than economic growth, then that indicates an expectation there will be more need to spend money in the future more than there is now, which once again means that putting that money into lower-return investments now would be a costly mistake—it would mean wasting limited resources in the present when there will be more valuable uses for those resources in the future.

On the other hand, if the deflation is due to manipulation of the money supply, then that just comes down to sending false signals, and an economic loss should be expected. Deliberate deflation gives people an incentive to hold their money rather than make investments which would be better for the economy, just as deliberate inflation leads people to make investments whose low returns actually reduce overall economic growth.

To illustrate how currency inflation leads to malinvestment, let's say that annual growth in terms of purchasing power, the total supply of goods and services, is 3%. The money supply increases by 5% over the same period. Between the two, you should expect prices to increase by about 2%. Let's also say that there's an investment which pays 4% nominal returns. While obviously not the best investment out there (the average should be 8% based on the growth and inflation rates), it looks reasonable on paper—that's a 2% net increase in purchasing power, which is far better than the 2% loss you'd get from simply holding on to the money. However, the contribution to economic growth is actually -1%; 5% of that 4% nominal return came from the increase in the money supply. It only looks profitable because the economy was growing by 3% at the same time. Making this investment, or any other investment with less than 8% nominal returns, will slow the economy rather than contributing to its growth.

TL;DR: When deflation causes people to hoard rather than invest, it doesn't affect the value being invested, just the nominal amount of currency. What it does do it let the people who are competent to pick economically profitable investments do so without interference from others only looking for somewhere to park their money where it won't depreciate too much.

Wouldn't the backup software also get the decrypted data? Or is the ransomware treating requests by the backup software differently than requests by other programs?

The effect is the same whether it's one bank acting alone or many banks acting in concert. One dollar deposited at one bank leads to a series of loans and further deposits which eventually permit 1000 banks to make 1000 $1 loans and, all together, collect $10 worth of interest. Provided, of course, that no two individuals ever ask to withdraw "their" dollars at the same time and thus bring the whole house of cards crashing down.

Out of curiosity, do the banks really need to be different, or does money deposited by a bank's loan customer count toward that bank's deposits? It was my impression that all deposits counted and there was no need for the money to pass through many distinct banks.

I'm not really as fanatical about fractional-reserve banking as some. I consider it shady and unsound but not inherently fraudulent so long as the bank's practices are public knowledge; caveat emptor. I would prefer a clear dividing line between demand accounts, which the bank must be prepared to pay out in full at any time (full reserves), and time accounts, which should be clearly described as investments, loans to the bank which, like any loan, may not be available for withdrawal on demand and could end in default, costing you some or all of your principle. Current practice is to mix the two types in varying proportions, from interest-bearing checking accounts to CDs guaranteed against default.

Not "unpredictable deflation", just significant decreases in the supply of money—planned or otherwise. Price deflation is not correlated with recessions in general, just in cases like the Great Depression where the supply of money underwent a significant contraction. You point out that a deliberate policy of destroying currency to manipulate its price relative to other currencies led to recessions. Well, naturally; that's what happens when you play with the currency supply, regardless of whether you're creating inflation or deflation: you send false signals, which leads to malinvestment, which destroys wealth, which leads to a recession.

If the value is only increasing at the rate of inflation then it's not an investment, it's just savings. So I buy a house, and in ten years (ignoring taxes and maintenance costs) I still have the same house, and it's worth about the same relative to other goods as it was when I bought it. Where's the expected return? To be an investment there needs to be an expectation of a net return, not just in nominal dollars but in actual value, and for that the nominal return has to outpace inflation.

As I said, low reserve requirements.

I have no problem with "work of the mind"—I'm a software developer too, BTW. But when you can take $1 in reserves (just enough to meet the daily demand for physical currency) and turn it into a $1000 loan, and get paid real interest on the full $1000, there's something undeniably fishy going on. If you or I tried that we'd be charged with fraud in a heartbeat. Though I suppose running a successful scam can be considered "work of the mind" if you stretch it far enough, I wouldn't consider the proceeds "earned".

They do convince people to lend them money. However, if I convince someone to lend me a dollar, I can't turn around and convert that into a $1000 loan to someone else. If I want to collect interest on a $1000 loan, I have to actually have $1000 to lend out or be considered a fraud. The bank has a monopoly on cheap money because when they want to collect $10 in interest on a $1000 loan they only need to convince people to lend them $1, not $1000.

Nonsense. There is a mechanism for chargebacks in Bitcoin. It's known as "escrow". Given a non-reversible payment mechanism, it's trivial to add reversible transactions as a layer on top. Implementing a non-reversible payment scheme on top of reversible transactions, on the other hand, is nearly impossible. Which kind you need depends on the situation. For an individual ordering durable goods from the smaller online venders, you want escrow to protect both sides. For the provision of services or highly non-durable goods, where there is no way to recover costs in the event of a chargeback, a more permanent form of payment makes sense. Disputes in such cases need to be handled through arbitration anyway.