I think you are actually making very good points, and I learned something.
That said, I am not assuming a major boom/bust cycle, so given that assumption, our two positions are easily reconcilable.
I am assuming a steady rate of growth of the global economy. In that case, there is deflation over time, yes, but investors known that ahead of time, so some of it is already priced into the value of the currency.
I think that the boom-bust cycles are vastly exacerbated by regulatory intervention. For instance, the current recession we are in in the US was entirely caused by Fannie and Freddie buying tons of shit mortgages for decades and the notion of "too big to fail" plus regulatory pressure leading to unhealthy consolidation and gambling in the banking industry.
In a truly free market (which maybe we will never see again so who cares), there may still be glitches in the market that cause temporary busts, but those should become increasingly rare over time as the economic system becomes more globalized, robust, and decentralized.
That said, I am not assuming a major boom/bust cycle, so given that assumption, our two positions are easily reconcilable.
I am assuming a steady rate of growth of the global economy. In that case, there is deflation over time, yes, but investors known that ahead of time, so some of it is already priced into the value of the currency.
I think that the boom-bust cycles are vastly exacerbated by regulatory intervention. For instance, the current recession we are in in the US was entirely caused by Fannie and Freddie buying tons of shit mortgages for decades and the notion of "too big to fail" plus regulatory pressure leading to unhealthy consolidation and gambling in the banking industry.
In a truly free market (which maybe we will never see again so who cares), there may still be glitches in the market that cause temporary busts, but those should become increasingly rare over time as the economic system becomes more globalized, robust, and decentralized.