The "convert HBD" button sends the HBD to the @null account. It then creates a dollars worth of HIVE in its place. The system charges a 5% fee. It guarantees HIVE at 95% of the US dollar.

When converting from hive to hbd the chain takes 5%, but when converting hbd to hive there is only the 3.5 day wait and no fee.

I think we need more inflation over all.
400million hive is not that many, we need 8billion just for everybody to have one.
I like the hbd inflation because it takes the pressure off the rewards pool for greedy folks to get their fix.