[p2p-research] excellent contribution on flow money by Martien van Steenbergen

[Martien van Steenbergen]

Ryan,

On 21 May 2009, at 18:52 , Ryan Lanham wrote:

> The reason markets work so well is that the best possible decision  
> process happens closest to the stakes.

A good example of rapid feedback loops (w/o too much delay) that aid  
healthy systems.

> I agree with you that profits are excessive in a number of markets  
> and that monopolies and oligarchies (trusts) exist.  We should break  
> them up.

Yes. And we should also design systems that prevent them from  
emergence in the first place.

> If you do away with currency, how will you allocate goods?  Who  
> decides who gets what and when?  How do you educate people to act  
> selflessly and morally when there is no evidence that any large  
> scale human settlement has done so for a sustained period in the  
> face of plenty?  Moreover, how do you get people to go to work?

So to the point. A (monetary) system has a very strong organizing  
effect. So, use with care. One should bare this in mind when designing  
systems. Characteristics like bonuses, interest, flow money, scarcity,  
buffers, feedbak loops all help organize a system and its users as a  
whole. Organizing means bringing order to chaos. Care must be taken  
that the system does not over-overganize (i.e. focuses on efficiency  
only). Same applies to under-organization, or chaos.

See (esp. page 15 and further) of Lietaer's http://lietaer.com/images/White_Paper_on_Systemic_Banking_Crises_final.pdf

White Paper on all the "Options for Managing Systemic Banking Crises",  
and their economic consequences. It also provides the theoretical  
justification for the recommended strategy (560 Kb). Please, click  
here to dowload.


> The only answer is and can be that you COMPEL them to these things.   
> And when you compel, you will end up with corrupt politics--always  
> and every time.  People will cheat for their uncles or daughters or  
> old school chums, etc.  I notice that in Soviet-styled systems the  
> big shots were never skinny.

Or, better tmo, design and implement a system (of game rules) that  
EDUCEs the right behaviour.

 >>>
educe \eh-duse\ A marvelous word seldom used or practiced, meaning "to  
bring or draw forward something already present in a latent, or  
undeveloped form." It can be contrasted with induce, too often used  
and practiced, meaning "to prevail upon; move by persuasion or  
influence—to impel, incite, or urge."
<<<

One of Dee Hock's principles for Visa.

Succes en plezier,

Martien.
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