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RE: Witness votes for higher interest!
A bond with a convert should trade above $1 for the convert premium. If there was no convert option I would agree. But if you want a real peg you need an interest rate that gets to one dollar when no one is valuing he convert. Other wise when convert option goes to 0 the bond will go below par. It's horrible for this to trade below one whenever you need the stability. It doesn't matter if it's usually higher than $1
The SBD peg is far from perfect, I give you that. There are two separate things to discuss regarding the interest though. There are short term market fluctuations, and medium to long term trends. You seem to be indicating that the goal should be to prevent it from even dipping below $1 USD, even for a short term. For one, this is opposite of how the whitepaper says it should be handled. Also, even with relatively high interest (3-5%), that would not be enough to prevent short term dips below $1 USD. The interest rate would need to be quite high in order to accomplish that, and would also result in SBD trading more than a few cents above $1 USD most of the time, which is also not good.
I am not sure it would have to be that high to stay above $1 with a ten percent rate. The reason it had trouble before was that sbd market cap was too close to steem market cap. Now that steem is much higher that's not an issue anymore. If there was enough sbd out there that it could be a flight to safety currency it might start going up in crypto selloffs. I think with ten percent interest it would rarely dip below $1 unless steem fell below $100m market cap.
10 percent would solve one problem but create another. You are right, it would rarely dip below $1 USD, but it would also not peg at a dollar either. We would likely see SBD pegged around $1.05-$1.10, which would also not be good (for different reasons).