Ok so I am see a lot of complaints about whales getting big rewards for crap posts and as someone who puts time into my posts and gets <$1, I can understand their annoyance. But the main point of this post is to show you that whales are actually losing out.

Inflation

The crux of my point will be the inflation model of steem.

Currently the supply of steem increases at 9.5% a year. Of this new steem 75% of that goes to authors and curators and the rest goes to witnesses miners.

This means that you need to earn 7.125% to get 'your share' of that new steem and 9.5% to stay ahead of inflation.

Examples

Let's look at an account that has 1,000SP and one that has 1,000,000 what their weekly numbers need to look like. Also we can look at some active top 10 whales @blocktrades, @ned, @jamesc, @val-a, @abit, @dantheman, and as he's been discussed a lot around this topic 15th biggest @berniesanders. Also just thought as I am putting other people's info out there better put my own as well.

All earning have been adjusted to steem

target ROI (both) Needed Weekly ROI (both) Needed Weekly earnings (minnow) Needed Weekly earnings (whale) 7.125% 0.132% 1.32 1,320 9.5% 0.175% 1.75 1,750

Whale This week's earnings Projected Yearly ROI @blocktrades 4975 4.5% @ned 665 0.6% @jamesc 512 0.8% @val-a 1120 2% @abit 1360 2.4% @dantheman 240 0.5% @berniesanders 580 1.7% @fiveboringgames 83 53%

So as we can see none of these whales are not getting there 'fair share' of the new steem and are certainly not beating the inflation. I'd also like to note that I had one post do well this week so my 53% ROI is likely inflated and similarly for the whales this week may not of been indicative.

Too big to succeed

To be successful at curating you need to find posts early that others will like and for them to vote much more on it than you did. Whales have a hard time here, I know it doesn't seem that way due to the bigger numbers, but for example if I upvote a crap post to $0.01 that will give it more visibility and it may go on to get $0.02, I will not receive much, this would be a failed curation. for a whale to upvote to $15 and the post to get a lot of visibility and go on to earn $30 is the same level of failure as my one. Most of my curation earnings comes from finding posts and upvoting them to $0.01 and having them go on to earn $10 - $100 for a whale to have that success they would need to find a post early and have it make $15,000 - $150,000, nearly impossible. they have a similar problem when it comes to posting.

In the steemit system whales are not 'too big to fail' they are 'too big to succeed'

This is why we shouldn't be worried when whales powerdown, it is something they need to do.

It just occured to me that due to this a STEEM is worth less money to a whale than it is to an average user getting 7.125% ROI, probably up to 5% less due to the difference in their returns. Added to this is the fact that most of the STEEM being sold on markets is from whales powering down. Therefore the STEEM on market places is discounted, likely for the next good while, as long as there are whales with too much SP to handle.

Don't start a save the whales fund yet

It's not all so bad for the whales, firstly they got all that money by being early adopters/founders/miners and secondly if steemit is successful it's increased valuation will easily beat inflation.

For example in the last month the value of steem should have fell 0.76% due to inflation but it has increased 13.5%.

For a whale the earnings possible by curation and authorship pale in comparison to the potential earnings if steemit is successful. So they have a very big incentive to help the it succeed.

Conclusion

I know it's hard to see a whale upvote a crappy post with a picture of a dog, and sit there thinking 'Why don't you upvote my crappy post with a picture of my crappy dog!!'

sorry for calling you crappy Max

Just remember they are losing out in expected value. Doesn't make me less jealous, stupid crappy dog.

P.S

As a side plug, for anyone with streemian.com that wants to increase their curation earnings but doesn't have the time then get on my curation trail to automatically vote on everything I vote on. I currently earn around 9.6%for curation alone, while as you will be voting after me you will get less, you should get >9% if you one of the first 10 in the trail.