It's hard not to admire Dave Fishwick, the eponymous Dave in 'Bank of Dave' the TV series and "Bank on Dave" (aka Burnley Savings and Loans) the company that he founded to provide banking services to Burnley, Lancashire, England and the area, but which he wanted to be a bank.
In a Dave v Goliath struggle, the entrepreneur, plain-speaker and shooter from the hip takes on the might of banking law and the Financial Services Authority. He sort of wins out, because by the end of episode 2 of the TV series he is allowed to make loans and take deposits, though he must match them. In six months he makes a profit of £000s which he generously give to charity.
But is this all scaleable? He has to charge interest on his loans, even though he is careful about what he invests in. This is in part because he offers savers 5% pa (with a few sweeeners to early adopters). I think he was (is?) lending at around 8-9% pa.
Where does the money to pay interest come from? Other people - well yes, but where ultimately? Money supply has to increase so that there can be enough money in the system to pay back the interest. If it doesn't, mathematically some people have to go bust. (If it does, some people still do go bust, but not because of shortfall in all money).
This is a big, big problem for money. The total utility of goods and services increases over time, so money should increase in supply in keeping with it. But how do you quantify it?
Sunday, 22 July 2012
Saturday, 21 July 2012
Problems of lack of co-operation
A few examples have come to my attention recently:
1) Another car journey sharing venture, gocarshare, to compete with Liftshare and the other very similar offerings.
2) Google's beta test of its cycle route directions on its maps, despite parallel offerings from cyclestreets.net, TfL and others,
3) Qype. I downloaded the Androis app as it had been avourably reviewed in the Webscape segment of BBC TV's Click. One of the first things I found was a reference to a pub that closed ages ago. I entered a 'review' saying this - I could see no other more appropriate facility. There are so many websites / apps holding data about businesses that to tell them all would be a lifetime's work. In Qype, we have an app that cpould be extremely useful, but it can only ever be as useful as the data it is working on and my first experience has put me off.
1) Another car journey sharing venture, gocarshare, to compete with Liftshare and the other very similar offerings.
2) Google's beta test of its cycle route directions on its maps, despite parallel offerings from cyclestreets.net, TfL and others,
3) Qype. I downloaded the Androis app as it had been avourably reviewed in the Webscape segment of BBC TV's Click. One of the first things I found was a reference to a pub that closed ages ago. I entered a 'review' saying this - I could see no other more appropriate facility. There are so many websites / apps holding data about businesses that to tell them all would be a lifetime's work. In Qype, we have an app that cpould be extremely useful, but it can only ever be as useful as the data it is working on and my first experience has put me off.
Thursday, 5 July 2012
Money supply
Further to my previous post about the gold standard here, I made a similar point on Facebook alongside a slide published by positive money. I got a reponse - thanks - which I have posted below, interspersed with my further responses:
I was looking fo some measure of the quality of human existence, or our ability as a society to protect and preserve our own species. Whilst a long life isn't necessarily a good quality life, it is a reasonably good proxy - if you're healthy you live longer. If there's no war, hunger, disease etc, people live longer. It then occured to me that if people lived longer there would be more people alive at any one time, so perhaps population rather than life length would do.
Perhaps the Indian Government (or any other government) would be able to create the money that corresponds to India's population, so it would have the money and it could spend it as it chose. What we would have to decide is how many money creating authorities there would be. For example, if the UK created some its per capita money, then England, N Ireland, Scotland and Wales couldn't also do it - this would be double counting.
What underlies your question seems to be the tacit assumption that more money is better. We are brought up to think/act like this, but what is in fact better? Better health ( longer life) and more happiness (which may be the same as better health).
The only way to cause population and longevity to rise is to manage physical resources in order to achieve more and longer lives per unit of resource.
===
Addendum - what is gold really useful (non aesthetically) for?
1) Its electrical conductivity cf its corrosion resistance makes it useful in electronics
2) Its reflectivity of radiation so for satellites and space suits.
3) Its transparency when thin enables it to be used in heated windscreens in aviation.
Thanks to Wikipedia for information.
- Surely the number of people alive is as arbitrary as the amount of gold that has been discovered!
I was looking fo some measure of the quality of human existence, or our ability as a society to protect and preserve our own species. Whilst a long life isn't necessarily a good quality life, it is a reasonably good proxy - if you're healthy you live longer. If there's no war, hunger, disease etc, people live longer. It then occured to me that if people lived longer there would be more people alive at any one time, so perhaps population rather than life length would do.
- One third of all the worlds refined gold is kept in one place - around the necks of Indian women. Scott's approach would make India rich!
- How could we be sure that India, having one of the largest populations, would get it's fair share of the money that is created under your suggestion, any more than it does under the current one?
Perhaps the Indian Government (or any other government) would be able to create the money that corresponds to India's population, so it would have the money and it could spend it as it chose. What we would have to decide is how many money creating authorities there would be. For example, if the UK created some its per capita money, then England, N Ireland, Scotland and Wales couldn't also do it - this would be double counting.
- Also, wouldn't it encourage countries to inflate their population?
What underlies your question seems to be the tacit assumption that more money is better. We are brought up to think/act like this, but what is in fact better? Better health ( longer life) and more happiness (which may be the same as better health).
The only way to cause population and longevity to rise is to manage physical resources in order to achieve more and longer lives per unit of resource.
- The Greens wouldn't like you.
===
Addendum - what is gold really useful (non aesthetically) for?
1) Its electrical conductivity cf its corrosion resistance makes it useful in electronics
2) Its reflectivity of radiation so for satellites and space suits.
3) Its transparency when thin enables it to be used in heated windscreens in aviation.
Thanks to Wikipedia for information.
Monday, 2 July 2012
Gold standard lunatics
The episode of BBC Radio 4's Analysis programme which aired tonight at 1930 GMT had a scary false dichotomy between the gold standard and our current monetary supply system.
It is true that it doesn't make sense to have a money supply without a physical referent, but that doesn't make the gold standard any more logical. If money supply was related to the amount of gold that has been discovered, the absurd situation arises that discovering a quantity of a comparatively useless metal would increase the size of the economy, and once all gold has been discovered, the economy cannot grow.
Relating money supply to the price of gold is nonsensical, because the price of gold must be in units related to the price of gold (as money is on the gold standard). Or, if the price of gold could float freely, money supply would be related to a free floating variable.
In the gold standard, gold had to be shipped. Ridiculous. All this relatively useless stuff did was sit in vaults wile it wasn't being transferred betwwen them. No wonder governments realised it was utterly stupid, and sold the gold without admitting it.
But the gold standard proponents were right that money supply should not be unrestrained. It is a starting point to say that it should be related to the amount of goods and services being produced. The problem here is the problem of growth in GDP - the planet is finite so far as physical stuff goes, so insofar as it relates to stuff, money supply should not increase. Services are a different matter. Technology is a case in point. Microproccessor based technology is getting smaller as it gets more powerful. It sis clear that, over time, we can get more service per unit of stuff. If we could quantify service, we might have a guide to the quantity of money that there should be, but how do you compare a basic human need (nutrition, say) against a higher order need or service (finding out where the nearest restaurant is using your smart phone).
For me, human well-being is the key and for the moment, I'm thinking money supply should be a function of the number of people alive and their age. I'm sure this is less than perfect, but it is a starting point.
It is true that it doesn't make sense to have a money supply without a physical referent, but that doesn't make the gold standard any more logical. If money supply was related to the amount of gold that has been discovered, the absurd situation arises that discovering a quantity of a comparatively useless metal would increase the size of the economy, and once all gold has been discovered, the economy cannot grow.
Relating money supply to the price of gold is nonsensical, because the price of gold must be in units related to the price of gold (as money is on the gold standard). Or, if the price of gold could float freely, money supply would be related to a free floating variable.
In the gold standard, gold had to be shipped. Ridiculous. All this relatively useless stuff did was sit in vaults wile it wasn't being transferred betwwen them. No wonder governments realised it was utterly stupid, and sold the gold without admitting it.
But the gold standard proponents were right that money supply should not be unrestrained. It is a starting point to say that it should be related to the amount of goods and services being produced. The problem here is the problem of growth in GDP - the planet is finite so far as physical stuff goes, so insofar as it relates to stuff, money supply should not increase. Services are a different matter. Technology is a case in point. Microproccessor based technology is getting smaller as it gets more powerful. It sis clear that, over time, we can get more service per unit of stuff. If we could quantify service, we might have a guide to the quantity of money that there should be, but how do you compare a basic human need (nutrition, say) against a higher order need or service (finding out where the nearest restaurant is using your smart phone).
For me, human well-being is the key and for the moment, I'm thinking money supply should be a function of the number of people alive and their age. I'm sure this is less than perfect, but it is a starting point.
Saturday, 30 June 2012
How would scarce resources be allocated in an RBE?
This is a version of one of the killer questions that is supposed to show the RBE as flawed, but the best is the eneny of the good here.
In the current system if something's abundant it's a problem, because it's hard, if not impossible, to make money out of something that's abundant. This is why food is wasted or stockpiled while people starve to death, and why [alleged] natural cures for illnesses are downplayed, denied, hushed up or exproprited as commercial products. It cannot be any other way with the current system.
An RBE addresses this issue of deliberate scarcity. Yes it is left with actual, irreducible scarcity, but to use that as an argument against it is invalid if it means sticking with the system we've got until we find a flawless replacement.
We don't really know what these irreducible scarcities are, but we certainly know what the avoidable ones are and I say we make a start.
In the current system if something's abundant it's a problem, because it's hard, if not impossible, to make money out of something that's abundant. This is why food is wasted or stockpiled while people starve to death, and why [alleged] natural cures for illnesses are downplayed, denied, hushed up or exproprited as commercial products. It cannot be any other way with the current system.
An RBE addresses this issue of deliberate scarcity. Yes it is left with actual, irreducible scarcity, but to use that as an argument against it is invalid if it means sticking with the system we've got until we find a flawless replacement.
We don't really know what these irreducible scarcities are, but we certainly know what the avoidable ones are and I say we make a start.
The power principle
http://metanoia-films.org/the-power-principle/
A long documentary in 3 parts, each well over an hour long, but worth making the effort. Not very encouraging to think that we're controlled by an elite for their own benefit, especially if we can't do anything about it. Perhaps it's no wonder people just go along with it - but it's tough on the seriously poor and seriously oppressed to have to accept their low station so that social stratification our system requires to continue can be maintained.
Definitely worth watching, but not something to gladn your heart.
A long documentary in 3 parts, each well over an hour long, but worth making the effort. Not very encouraging to think that we're controlled by an elite for their own benefit, especially if we can't do anything about it. Perhaps it's no wonder people just go along with it - but it's tough on the seriously poor and seriously oppressed to have to accept their low station so that social stratification our system requires to continue can be maintained.
Definitely worth watching, but not something to gladn your heart.
Friday, 29 June 2012
Natural Capital
The Now Show on BBC Radio 4 (a comedy show based on current affairs) mocked the UK Governments' attempt to account for the services that the biosphere provides us with in financial terms. I wish they hadn't. We can't continue to liquidate natural capital and call it income, therefore some attempt to cost (say) the pollination service performed by bees, or the various services provided by trees should theoretically go some way to correcting our current system's tendency to ignore 'externalities' and plnder the planet for profit.
The UK's Conservative government (in coalition with Liberal Democrats) could live up to its Conservative name by seeking to find ways to conserve our planet, and focus less on conserving institutions and traditions for their own sake. The need to sustain human life on this planet is very serious. Yes, make humour about it, but be careful not to undermine any effort in that direction.
The UK's Conservative government (in coalition with Liberal Democrats) could live up to its Conservative name by seeking to find ways to conserve our planet, and focus less on conserving institutions and traditions for their own sake. The need to sustain human life on this planet is very serious. Yes, make humour about it, but be careful not to undermine any effort in that direction.
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