[p2p-research] "Trading at Cost" with joule tokens

[marc fawzi]

The line under Use Case 1-01 (Trading at Cost of Energy) should read:

"In other words, the tit for tat exchange between Tom and John is done in
the context of supporting a generalized exchange of energy *for good and
services (using* tokens) between each peer and the community as a whole."

fixed in model's description



On Fri, Jan 16, 2009 at 10:04 AM, marc fawzi <marc.fawzi at gmail.com> wrote:

> Here is one reason why it's practically impossible to trade at cost using
> the existing money:
>
> <<"In the existing system, it's practically impossible to calculate an
> absolute cost because the existing currency (e.g. US dollar, euro, yen, etc)
> itself is relatively valued and changes in value over time due to inflation,
> amount of currency in circulation, international trade imbalances, borrowing
> by governments, and many other reasons. ">>
>
> It's basically taking Patrick push for trading at cost and give it a
> natural context by reframing cost as 'average cost in energy' (an absolute
> value) used for producing and delivering a product.
>
> There is also some analysis of how the existing currency actually
> "enforces" scarcity:
>
> <<"The existing currency (e.g. US dollar, euro, yen, etc) is part of the
> model that has let scarcity persist and grow. By directing more and more
> money into scarce resources (due to ability for sellers to set arbitrarily
> high prices in response to demand for such scarce resource) rather directing
> more and more money into solving the circumstances that cause scarcity, and
> by deriving its value from its scarcity rather than from its utility, the
> existing currency is fully complicit in the enforcement of scarcity.">>
>
> The following use case provides a real-life (or specific) example of what
> trading at cost means:
> <<"Use Case 1-01
>
> A person (let's call him Tom) who puts 10M joules into producing some
> product (let's call it XYZ) will get that energy back not from the person
> who buys the product (let's call him John), who actually pays Tom 1,000
> virtual joule tokens for the product (where each virtual joule token is
> 10,000 joules,) but from the person who makes the food that Tom consumes
> and/or from the person who provides entertainment that makes life livable
> for Tom and/or from whatever producer of goods and services that makes the
> enables (or helps to enable) sustainable production of XYZ by Tom, and this
> amounts to a generalized exchange of energy (or outflow/inflow loop) between
> Tom and the entire community, not between Tom and John directly.
>
> In other words, the tit for tat exchange between Tom and John is done in
> the context of supporting a generalized exchange of energy (as tokens)
> between each peer and the community as a whole.
>
> You may then wonder what's the difference between this model and the
> existing model, given the latter does the same?
>
> In this case, John pays, in joule tokens, the average cost in energy it
> takes to produce and deliver the product to John. Tom gets back, in joule
> tokens, the average cost in energy it took him to produce and deliver the
> product (including the actual work energy.) In other words, the price does
> not depend on the features or benefits the product has. What matters is that
> Tom made it and wants to give it to the world without starving himself.
> That's why artists give away music, or why software developers make free and
> open source software. It's the creative impulse that exists within all of
> us. What this model allows that the current does not is for John to give
> back Tom the average energy Tom put into producing and delivering the
> product to John. This means that Tom does not make a profit, but he will not
> starve due to giving things for free.
>
> In the existing system, it's impossible to calculate an absolute cost
> because the existing currency (e.g. US dollar, euro, yen, etc) itself is
> relatively valued and changes in value over time due to inflation, amount of
> currency in circulation, international trade imbalances, borrowing by
> governments, and many other reasons.
>
> Thus, this use case (or example) demonstrates the benefit of the first
> proposition of this model (see: Model's Propositions, also stated in parent
> section.)" >>
>
>
> There has also been an important realization:
>
> <<"It is expected that 'circumstantially scarce' goods (e.g. out of season
> fruit) and services (e.g. vanity services, legal services, creative
> services) and assets (e.g. land) will continue to be priced using the
> existing scarcity-enforcing currency (e.g. US dollar, euro, yen, etc), which
> causes the emergence of manipulative/controlling power (due to competition
> for scarce resources) in those scarcity driven markets. However, this
> problem is not fully resolvable by this model. It is hoped that the
> circumstances that cause scarcity are eliminated, one by one, by
> technological progress.
>
> In this sense, the currency defined under this model, i.e. the programmable
> virtual joule token, can be viewed as a complementary currency whose purpose
> is to train society to move toward an abundance-based model of existence."
>
> Overall, the model has seen dramatic changes in the positive direction of
> sustainable abundance (beyond just for energy production) and away from
> ingrained patterns of scarcity and the manipulative/controlling behavior
> that comes with scarcity.
>
> The latest revised/evolved model is at:
> http://p2pfoundation.net/P2P_Energy_Economy
>
>
> I know there will be some disagreement as to whether the "Price Registry"
> model of collective price-setting-at-cost (cost of energy) is realistic or
> not but that's what we will be experimenting with in our simulation of this
> model.
>
> For more on the simulation work, feel free to visit or signup to
> http://groups.google.com/group/p2p-energy-economy
>
>
> Thanks again for all the feedback and help.
>
>
> Marc
>
>
>
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