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RE: Everytime I convert my SD (STEEM Dollars) into SP (Steem Power), I feel better about it.
The system is designed in a way that the price of STEEM should be very low in the long term. Everytime a coin is created the value of your actual STEEM goes down. STEEM POWER will counter balance that inflation, but you won't be making any actual profit from it. And if you buy STEEM POWER today with the price of STEEM that is very high (2 USD) you are actually getting less with your SBD that you would be getting when the price of STEEM stabilize again to 0.25 USD.
So the most interesting thing to do is to keep SBD in your account, wait for the right moment to buy STEEM to POWER UP your account. That's it.
That's right, if you're right. The rule of thumb though, is to always want more Steem Power.
If you keep an SD balance too long, you're not earning the same interest rate as Steem Power provides.
But SBD is pegged to the dollar, so it should retain value. STEEM doesn't have any real value and STEEM is created out of thin air. And because STEEM should drop in value over time, i believe that SBD is the best choice. If you create content 50% is going to SBD and 50% to STEEM POWER, i think you should keep it that way.
I'll be interested to see what other people think. All I know is that steem power accumulates more vests, a lot faster, than the interest does on holding SD. You win if you always buy more steem power early on, especially over the first 9 months of steemit's release from what I've read.
Also 90% of steem created on a particular day gets redistributed to holders of steem power.. who are basically shareholders in this whole system. You miss that payout when you hold SD.
Yes that would be true if Steem price was steady or going higher. But steem price should go lower.
Steem Price will be higher. 0.000001% of the internet knows about steemit right now.
The economics are the floowing. Yes you get 90% interest per year for your steam power, but yes steem is inflated 100% per year (currently even more / 1% per day).
That means yes, effectively you loose 10% of your steem stake per year, currently even 0,1% per day.
Yes, if new buyers come in that buy up these 10% per year your steem power would be worth the same counted in dollars. If new buyers buy up more then these 10% you make a win counted in dollars.
If you just hold the steam dollars you get currently 10% per year. So only if 20% new capital is coming into steam, investing in steem power would be more lucrative then investing in steem dollars. In way we also have to count that indirectly the steem holders are paying for the steem dollar interest, so the amount of new capital needed per year so that steem power is more lucrative then steem dollars is even greater...
I would suggest to use your steem dollars and convert them manually to steem if the price is less then for example 90 cents. so you make in average 5% to 10% win per week. The steem I would use to buy new steem dollars if the steem dollar price is below 1 dollar.
If the steem price is not falling anymore you then can use your steem dollars to buy new steem and power up.
What do you think?