Hello Steemit,
As you probably know, the Steem Based Dollar is still overvalued. As of this writing, it's around 1.49 usd. I think this is a good thing, and it seems like it should be an opportunity.
One way to capitalize on this is to make the normal 50/50 posts. Don't you want to get half of your post rewards in nice juicy fatter-than-usual dollars? And this will help generate the dollars we need.
But I also had another crazy idea.
Witnesses, lets jack up the interest rate! 5%! 10% even!
What? Neoxian are you crazy?
Increasing the interest rate would make the steem dollars even more valuable and people would be scooping them up, and the SBD could spike to 5$, 10$..who knows? But but..this is the opposite of what we want? Right?
But think of this, the steem dollar spiking up so much would have these effects:
It would attract money and attention to the Steemit platform. Investors would pour money into the system, and that's good! At some of these investors might check out the forum as well, and perhaps power up a bit.
The interest rate would create more dollars. Steem dollars are in demand, so we need to satisfy this demand by printing more of them!
A very valuable Steem dollar would help make posts receive even more money. Imagine if your 50/50 post made 10$. You'd get 5 Steem dollars and 5$ worth of steem power. But if one SBD is worth 10$, then your 5$ is really 50$! wow
Once all these dollars start flooding the system and people cash them out, then the price will start to lower again. When this happens, the witnesses can reduce the interest rate. At this point, many investors may simply sell their dollars, but I think some would just power them up.
That what happened with me. Back when the interest rate was at a crazy 10%, I purchased 4000 Steem Dollars. I wanted to collect 400$ a year from that tasty interest. But when the interest waned and fell below 3%, I just decided to exchange them for Steem and power it up.
What do you think? Pretty nutty idea, and there's probably some good idea why it wouldn't work, which I'm sure you'll tell me below.