Writer, philosopher and long-time contributor to PeakProsperity.com, Charles Hugh Smith, returns to the podcast to explain the new socio-economic model he has just introduced to the world through his new book A Hacker’s Teleology: Sharing the Wealth of Our Shrinking Planet.

The main mission behind Peak Prosperity is to focus on new, more regenerative and sustainable models that will better serve humanity than the old models which are currently falling apart. Charles posits a new way of living that is a) achievable with existing resources and technology, and b) much more equitable and resistant to abuse.

We very much need new alternatives like this at this time. Because, once the system breaks in earnest, our ‘leaders’ will be desperate — and as Jared Diamond wisely observed “Nations in crisis borrow and adapt solutions already devised”. So getting good ideas on the table now, so that they’re available to be adopted when needed, is critical.

The principal idea is we need a new system. Now, it doesn’t have to replace the existing system entirely. It just has to be an effective alternative that people can choose if they so desire to.

In my opinion, it needs to be decentralized, anti-fragile, yet connected with other like-minded people. But right now, we’re having to start from scratch, basically reinventing the wheel. We’re fighting a kludgy, broken, unfair, rigged system every step of the way if we want to create a decentralized community-based economy.

So what would a system be like if we designed it from scratch to actually make it easy to join a community economy? Well, we want a system that’s opt-in and voluntary, not like the one we have now. We want it be fair, not like the one we have now. We want it to have it’s own money supply that comes from the bottom. Money should be created at the bottom of the economy, not at the top.

And we also want it to be human. In other words, like that it recognizes the value of dignity and our contributions, i.e., purposeful work that meets the needs of the community.

We all know it’s a finite world we’re on and that our resources are being depleted. And so we’re going to have to make some sort of concerted effort to share this somewhat equally, or at least not as un-equally as it is now.

To me, the obvious solution is take your own resilient homestead and lifestyle, multiply it by 100,000 similar oases around the world that are connected to a global community economy. Wealth can be more equitably shared because we’re all sharing the same value system: de-growth. Becoming more efficient, becoming more localized, not wasting resources, and not chasing profits as the only incentive in the system.

Click the play button below to listen to Chris’ interview with Charles Hugh Smith (46m:28s).

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Transcript

Chris Martenson: Hello, everyone. I'm Chris Martenson of Peak Prosperity, and we're here with another Featured Voices podcast. This is a really important one today.

As you know, a lot of what I do has been, up to this point in time, has been about problem definition. And I'm not going to go there because I think everybody who’s watching this is already familiar with what the problems and predicants are. Right, we’ve got global climate change and melting ice and running out of soil that’s being turned into dirt. And we’ve got oil issues looming in the future. We’ve got a runaway money system, all this stuff.

It feels out of control. That’s the problem definition, but the solution space, what does that look like? We know that we're already in the fourth turning. We know that already institutional faith and trust in institutions is eroding. And we know that we're in a period of great upheaval and change with a fractured population. So none of those are really great inputs to really begin to shift things at this point in time.

So my view is that we're going to through some more hardness, hard times, darkness, things like that before we get to the turnaround. But it’s not too early to begin thinking about what that turnaround looks like.

If you’ve been following me, you know in my own small corner of the world I’m creating a little oasis, a literal oasis where in my own small way converting soil – dirt back into soil and working with my local community and building up the infrastructure I need so that I can be really additive to my community. So that’s one thing that you could do. It’s one thing I'm doing.

So lots of people are searching for these kinds of solutions.

With us today to talk about this and the solution place and what comes next, what comes after the crumbling. There's going to be a rebirth, a reemergence. So it’s not too early to be thinking about what does that look like?

And I think if we're fair, we say a lot of the systems that we’ve put in place aren’t working for us; we're working for them. We are in service to money, not the other way around. It’s bazaar, right. And don’t even get me started on how badly our health institutions behaved during this whole COVID crisis, things like that.

So the question becomes if not that, then what? And that’s what today’s conversation is about with Charles Hughes Smith, prolific author, good friend of both myself and Adam, and a long time Peak Prosperity contributor and all around great guy. His blog is Of Two Minds, and he’s just a fantastic, fantastic thinker and articulator.

And guess what? He’s written a book about this very subject, so that’s why we're bringing him on today to talk about that. Charles, welcome to the program.

Charles H. Smith: Well, thank you, Chris, for that. And what a brilliant introduction to the ideas behind the book which is we're going to need a new system. Now, it doesn’t have to replace the existing system entirely. It just have to be an alternative that people can chose if they so desire to.

But I think what the idea behind the book is to take your oasis and other people’s oases, like decentralized, anti-fragile, but connected with other like-minded people, and create a system that actually makes it easy to do this. And right now, you're having to start from scratch, basically reinvent the wheel. And then you're fighting a kludgy, broken, unfair, rigged system every step of the way to create a decentralized community-based economy.

So my idea was what would a system be like if we designed it from scratch to actually make it easy to join a community economy? And so the books’ title is A Hacker’s Teleology. And you go well, that’s interesting, but what does it mean?

And so it means that a hack is like a life hack. It’s not like a bad thing. There are hackers who try to break in and control systems and so on. But originally the word hack meant a workaround. You’ve got a kludgy system that’s not working, and you don’t have the time, money, energy to create a whole new system from scratch. You're going to have to find a workaround. So that’s why I say it’s a hacker’s teleology.

What’s a teleology? Well, a teleology is like the destination where we're going to reach if you connect certain dots. So what are the dots we want to connect? Well, we want a system that’s opt-in and voluntary, not like the one we have now. We want it be fair, not like the one we have now. We want it to have it’s own money supply that comes from the bottom. Money is created at the bottom of the economy, not at the top.

And we also want it to be human. In other words, like that it recognizes the value of dignity, our contributions, meaning purposeful work, and the needs of the community., things like that.

Well, if you connect those dots, you end up with the system that I’ve proposed. That’s the teleology part of it.

Then the subtitle is Sharing the Wealth of Our Shrinking Planet because we all know it’s a finite world we're on, and the resources are being depleted. And so we're going to have to make some sort of concerted effort to share this somewhat equally, at least not as unequally as it is now.

And so to me, the obvious solution is take your oasis, multiply it by 100,000 oases around the world that’s connected to a global community economy, and that’s much more likely to be sharing the wealth because we're all sharing the same value system. Which is degrowth, becoming more efficient, becoming more localized, not wasting resources, and not chasing profits as the only incentive in the system.

Chris Martenson: A Hacker’s Teleology, I like that. Thanks for explaining that because that definitely helped me understand what it is. And so let me pick up one piece of that; the fairness piece.

I think that one of the most obvious things about being a primate, to be biological about this, is all social creatures actually are wired for fairness in some way, shape, or form. And if we're in a deeply unfair system, people’s – any organisms’ attachment to that system begins to wane. Right, a deeply unfair system is not a really fun one.

I think if you took any six year old and you just completely rigged the game of Monopoly so they lost by the eight turn of dice, they would stop playing very quickly. So that idea, though, that we have deeply unfair institutions – my question to you is: Is that just an automatic place where humans end up? And if so, is there actually a system you could design where it just doesn’t end up there again?

Charles H. Smith: Right. I think that’s a key question because history seems to suggest that it always ends up in a hierarchy with entitled, privileged folks at the top skimming the wealth of the system.

But I think technology gives us a little bit of leverage here because it’s now introduced us to systems that we could design. In my terminology, you take a value system and you create processes that lead to those values being the goal.

And in the past, that process could always be convoluted, or it could be corrupted by people. Like that’s our political system. It was designed, you know, in an idealistic fashion, but it’s easily corrupted because everybody in the system can be bought.

But if you're dealing with a software system that’s opensource, that everybody can see how its programmed, but it doesn’t allow you to do anything but do what the system is designed to do, then you’ve limited the opportunities for human corruption. And people say, well, that sounds like a dream. Is that possible?

And I think about systems like that we use all the time, like large systems. They don’t have to have any bias. Like if you want to be an eBay buyer or seller, you join, and then that’s it. I don’t think the system is rigged to one ethnicity or one religion or anything like that. They just – if you follow the rules and you get good ratings, then there you go.

And so, if we took a system and we said we're only collecting this data: your name, your ID number in this system, and the reputational reviews of your peers, that’s all we're going to collect. Well then, where could there be any bias? We don’t have any information on which to base the bias.

And if no one is in charge, if it’s a self-organizing system, then there's nobody at the top to corrupt. And so I think it’s pretty obvious to me that the way you get a fair system is you don’t make it a hierarchy. You make it a flat system that’s self-organizing like nature, like an ecosystem.

And so, if you’ve stripped the system of opportunities for corruption and bias, well then you're not going to have any.

And, of course, there will be people that try to game the system and so on, and so you have to kind of watch out for that. But if the system is designed without any gigantic holes and it only collects this minimal data, then there really isn’t much opportunity for bias

And so I think AI could be applied to developing a completely unbiased system instead of maximizing profit. But I know that’s – my voice is lonely at this point in time, but I think that idea that AI could actually serve us instead of us serving it could catch on.

Chris Martenson: Let’s be clear. AI has been principally directed and used at this point to make money. So Twitter uses a very advanced AI system to determine what I like to see, what I don’t like to see, what’s going to ultimately lead to the most engagement. And it’s just parching through my every mouse hover and scrolling speed and all these other parameters to sort of figure out where am I slowing down, what am I looking at, and then feeding me stuff with the idea that I’ll click on something that makes somebody some money. So that’s all in service of money.

You're saying we could use AI potentially in service of humanity because, let me be clear about something – every money system enforces some behaviors, punishes others. It’s an incentive system, and so a debt based money system has some really powerful incentives baked into it.

I think, from my perspective, I cast judgment on it – I say it might have been a great idea in 1913. Probably made sense up through the ‘40s, but it’s been making less and less sense ever since. And now we're in the part of the story where you have to literally be insane to try and make sense of what the Federal Reserve is up to and the rationalizations for it.

So we’ve gone crazy over the tips of our skis in our attempts to perpetuate and maintain a system that’s pretty much outlived its usefulness. You say there's another system we could bring in on this, and AI could actually be part of that.

Charles H. Smith: Right. For instance, my basic idea, which I’ve often posted in my essays on Peak Prosperity, is if you don’t change the way money is created and distributed, you’ve change nothing. You can talk about reforms and oh, we're going to do this and noble sounding stuff. If you don’t change the way money is created and distributed you’ve changed nothing because people at the top have all the money, and they can buy whatever they want.

Jeffrey Epstein, a perfect example. You want to get into Harvard, the top echelon? Oh, just donate $10 million and then pretty soon you're the greatest buddy of everybody in Harvard. So that’s the way the system is rigged now.

So my thing is we got to start a new system of money, and cryptocurrencies give us that option. For the first time we can actually say we're going to create digital money, like the Fed does, out of thin air, but we're going to cerate it in only one circumstance, to pay for labor that was considered valued by the community.

And so if you did some useful work, like say on your creating a network around your homestead. if somebody in that network you're creating did some work that was beneficial, then they would get paid. And the system would monitor their activity, it would verify that they actually did the work so that they couldn’t cheat and say they did it but there's no verification. All this is pretty straight forward stuff.

And then the money would be created, and it would be limited because human labor is actually limited. The Fed has no limit, but human labor, there's only so much of it, even on a planetary scale. So the amount of money that we're creating is going to always be limited.

Meanwhile, it’s producing goods and services, so therefore, there's something in the system to buy. So there would be some use for the money.

So that’s kind of my scheme. And I consider it obvious which is of course dangerous because what’s obvious to me is not obvious to anybody else.

And so one of the things I tried to do in my book is explain my own life history. Like I’ve been working for 50 years, and I’ve had a lot of different jobs like a lot of other people. And so as I’ve encountered injustice and unfairness and bias and the rigged nature of the system, those experiences helped me realize well, we got to start with these fundamentals.

So the fundamental is we need a new kind of money that’s created at the bottom of the pyramid, not at the top.

Chris Martenson: Well, as I said, every money system enforces some behaviors, punishes others. I feel like farmers get punished in our system the way it’s currently configured. And having spent more time around farmers now because I'm trying to do some farming stuff, they are the most unbelievably, gifted, hardworking people I know. They are their own animal husbandry experts. They are their own crop specialists. They understand nutrient cycling. They can weld. They know how to build a house. They know how to fix stuff. On and on and on. They have to market everything.

Like if you wanted to say like basically they are everything soup to nuts from production to sales. And so it’s a pretty comprehensive sort of thing, and it’s very hard work. And by the way, they're some of the least well-compensated people I know.

So our money system basically punishes that and keeps squeezing towards an outcome which says all these smaller farms fold up shop because it’s just impossible. Kids that look at that lifestyle, aren’t drawn to it, go to do something else, and they become specialized in something. So Johnny leaves the farm, becomes a lawyer. Sally leaves the farm, becomes a doctor, whatever the story is.

And then, meanwhile, the big corporations start buying up all of the land and doing what they do in terms of industrially mining the soils and distributing stuff for the least amount of cost. All fine.

But you can see in this story we're gaining something; we're losing something. We're gaining cheap food; we're losing multi-diverse, very skilled people who are highly, highly resilient members of your community because they know how to do so much.

So what you're talking about is a system of money that begins to reverse that process?

Charles H. Smith: Exactly. And just in your example is excellent because it allows us to talk about fragility and anti-fragility, to use Nassim Taleb’s concept. And so since we're talking about food, we all know, and a recent COVID fallout, one of the things that happened was the handful of meatpacking facilities. When one is shut down, suddenly the whole system is revealed as incredibly fragile because this is what happens when you concentrate wealth and power and productive capacity in these small number of corporations and small numbers of facilities.

And I also want to say this is global. What you're talking about is equally true in Europe. Small farmers have been eradicated or squeezed out of existence in Europe as well by the same industrial scale of oil-based agriculture. And the average age of farmers in Japan, I think it’s over 75 now. I mean, I was over 70, now I think it’s pushing….There’s not going to anybody left that knows how to grow rice because that’s the incentives, as you say, in the system.

And so if we look at the forth turning and where it’s going to take us, I think it behooves us to start thinking about not just what we want but how do we instantiate those goals, those values, in a system that has the incentives that are going to reward anti-fragility and actual productive labor in behalf of the community in some way, and we disincentive unearned privilege, rigging the system, et cetera, et cetera?

And, of course, what you and I know, and the Peak Prosperity audience knows, is all the money that everyone’s chasing so blindly is all going to go away one way or the other. And so we're going to have to start thinking about a form of money that we control or that’s not controlled at the top of a corrupt self-serving hierarchy.

And people look at Bitcoin, and the problem with Bitcoin is it’s not earned by labor. It’s earned by computer time, basically electricity. And so that’s a good model for how cryptocurrencies – that’s one model. But I'm saying you don’t need that. You don’t need to mine a cryptocurrency. You can create a cryptocurrency that’s based on labor.

And just because nobody’s done it doesn’t mean it’s not possible.

Chris Martenson: Help me understand how it works. So let’s imagine somebody comes over and they're going to tend to my cows for a day. They do a great job at it. How do they get paid?

Charles H. Smith: So the way that I’ve envisioned the system is there has to be a group. The group is actually the one that organizes the work because a single individual isn’t going to be able to do the work, and that one individual needs to be part of a group. Because the group can organize larger work, and it can also have an organization that’s democratic.

Because we’ve got to be able to say well, who gets to decide what labor is valued and which one isn’t? And the software can manage some of that. So you need to start a group.

The way that my system is envisioned is the person that wants to help you with your livestock says, you know what? There's a shortage of people that know how to work with livestock in this community, so I'm going to start a group of people who are going to take care of livestock in the community as needed. We don’t necessarily own any, but we're going to help other people take care of theirs. That kind of thing.

So then, they’ll follow the software which has like step by step thing. Okay, it’s a democracy, so we elect a leader for a year and so on and so forth, and then we start organizing the work. And then you have to track the work. And then when you're done with your week then you have to fill out the software and say I performed these jobs at these places, and here’s photos from my Smartphone which, by the way, you can have a $15 Smartphone. You don’t need a $400 one. I mean, there's really cheap models in India and China.

So you upload some information that verifies you did the work, and then you look in your account and hey, you got paid. Now you can start spending that, and every community has its own kind of like mini Amazon in the sense that everybody’s goods and services that they're willing to trade is on the network. so you can buy and sell stuff with your new earned money. That’s how I envision it.

Because with the groups, then groups can combine, and they can do a lot more work. Groups can stay small. I mean, it’s infinitely flexible depending on the needs of the community.

And so I think – and if you’ve been in groups, and I’ve spent a lot of my life in groups: political groups, faith-based groups, companies, so on and so forth, social groups, educations, nonprofits, you name it. Of course, there's always a little friction. People are oh, somebody’s trying to run the meeting and so on and so forth.

But if you have that experience, it’s not too hard to design a system that rotates leadership, for example, and it has a system of subcommittees so work actually gets done.

And so I’ve designed a system that I think works based on my decades of experience in small groups. Yes, there's always going to be friction, but if you're working with purpose and meaning you set all that stuff aside because you're going wow, I'm contributing to something important.

And that’s such an amazing feeling, and it’s such a hit or miss thing in the system we have now. Very few people get to experience that. And that’s just – that just shows how inhumane our system is.

Chris Martenson: Indeed. Well said.

I maybe should have asked this question earlier, but based on all your research and all your writing and thoughtfulness, what’s your sense of the direction of things at this point? Are we facing a lot more hard times?

You mentioned something, you sort of threw it out there – we all know our money system is going away. I can’t imagine that without just being enormously disruptive if not destructive to most people’s lives. That’s a really painful thing when your money system fails. Are you saying that you're pretty sure our money system it going to fail?

Charles H. Smith: Yeah. I think if we look at history and we look at systems and, of course, you’re a systems guy, and people work in system. They exist in systems, but they don’t necessarily understand that they all have processes, and that processes generate output, and some systems can only generate a certain kind of output. So if that system is wired the way it is, you're only going to get one kind of output. And so if you want a different kind of output, you're going to have to change the system.

So if we look at history, and I like to look at the Roman Empire because it’s so well documented. That’s the difference between like say the Mayan Empire or the Tang Dynasty. We have some records, of course, from China. But the Roman Empire is remarkably well documented. You know, we have papyrus that was in Egypt where it shows the exact accounts and the crew members of ships going to trade with southern India and this kind of stuff. So we have a lot of detail.

Well, their money collapsed over time. They did the same thing that we're doing which is let’s inflate our money because we need more it, so let’s debase the silver coin with lead and other stuff. And then, oh, that worked, so let’s just do that some more, and then, pretty soon, there's virtually no silver in it at all.

And so that undermines the entire system because then people don’t have – they cannot trust that the money is going to have the value a year from now that it does in the present.

And Rome was also struck by pandemic. It was struck by invasions and people wanting their own resources back from the Empire. And political in-fighting that the elites in Rome were more interested in fighting each other than in dealing with the enemies, the barbarians. Which, by the way, they weren’t really barbarians – they just happened to be Germanic people that were in the Empire, but there was a built in bias against them.

And so by the end of the Empire all these fragilities took the system down. That’s how I would put it. That the Empire had once been anti-fragile, and all those sources of anti-fragility eroded, unraveled, or were corrupted, and so then what was left was only a fragile shell.

And I think that describes the U S economy, political system, and social system to a tee. It’s like a fragile, hollow shell, and it’s not going to take much for it to implode.

And since all these things are connected, you can have a political crisis that takes down the money supply because if there's political pressure to give us all a million dollars a month, well, then that’s a quick way to destroy your money supply right there.

Chris Martenson: So whenever in business you're facing a problem or predicament like this, you only have two choices: Do something. Do nothing.

And so for a lot of people I think it’s sort of the do nothing, might as well wait, see what’s happening. What you're talking about in your new book is that it’s time to start thinking about – for the people who are interested in the do something side of things, it’s never to early to start thinking about stuff.

And by the way, let me be very clear, Charles: No matter how badly it collapses – let’s imagine it collapses really bad. Money is just totally wiped out, supply chains break down, death and destruction, all of that. Nobody’s thought anything through.

Eventually, we're going to see that an economy and a money system emerges again because that’s how humans are. Every tribe, every society you look at has somehow found an expression for money, some way to store wealth, some way to do that. Whatever it was giant stones with circles in it or cowry shells or hides of animals or it was silver or it was gold or pieces of paper. it always seems to happen.

So I like the idea, though. You saying well let’s talk about this. What would we want? And I can give you a lot of not this in my own story. This whole COVID thing really – I have to confess – as jaded as I am or was, I was nowhere near jaded enough for this particular story. When I saw our health officials not recommending simple, cheap, effective things because of money, because they wanted pharma companies to be able to sell more of their latest fancy stuff.

That disconnection from the basic humanity, that’s not a world I have any interest in preserving. I don’t want to tweak it. I have no interest in figuring how to make it slightly better. I'm a burn it down kind of guy for a lot of that stuff. It’s unfixable.

So I think there's enough people listening to this though who also aren’t that way. I actually think we’ve been coopted by a very small, select group of people who are sociopathic if not psychopathic. Full definition in the DSM.

But for people who are interested in doing something and are caring and have some compassion and want to begin figuring this stuff out, what I hear you saying is it’s time to start doing the hard work. It’s not too early to begin lifting this because two outcomes: We do nothing and the economy crashes and all that, and the recovery from that could be kind of – when the Romans left Europe. Like for 400 years people are like, we don’t know how to make a heated bathhouse. That was really cool, but we kind of lost the technology. It’s gone. For a long time.

But if we had something in place and we’d thought about and we’d started working in small groups and gone through that reconnection process and that friction that always happens as people try and come to a shared understanding of something., if we can do that work now we’ll be in such better shape to at least – at least we're not starting from nothing when the rebuilding comes. Is that fair?

Charles H. Smith: Absolutely, Chris. That’s the main point of my book is okay, look it. If you’ve got a better system and you’ve sketched it out in greater detail then mine, hey, put it out there. We all need to start looking at some alternatives.

And so the basic model, that infrastructure that I'm talking about, is basically like a Linux or a Mozilla. In other words, you look at these things that basically started with one very small group of people started coding something, and then other people got interested, and they started contributing. And it wasn’t for let’s become billionaires.

And it’s all like we assume, oh, well if no one with do any work unless they're going to be a billionaire. And it’s all like, well, actually humans are wired to contribute and want to belong to something greater than ourselves, and to earn dignity by sacrificing with another group that’s got a purpose.

And so these systems, like Linux, show that you actually can design a software system which is global and robust with just people contributing to an opensource system.

So again, I think a lot of people are going to look at my ideas and go, well, that’s just airy-fairy kind of stuff, and it’s all like, well, no, actually, cryptocurrencies do exist. And actually, the more you know about cryptocurrencies, and I'm not an expert, you realize that’s a bunch of different platforms that have nothing to do with mining cryptocurrencies like Bitcoin. There's a lot of other models out there, and they already exist.

And there's a lot of opensource systems which are global like Linux and Mozilla that are not owned by a corporation, aren’t run by a sociopath at the top. Here’s talking to you, Warren, Bill, Jeff. [Laughs]

And so it’s entirely feasible. And yet, it’s beyond what any one of us can do. And so it’s going to take something like where a group of people, or some idealistic person who’s now guilty about the hundreds of millions they’ve skimmed off the system to say, well, I'm going to put some kind of tiny amount of money like $10 million bucks behind this idea, see where it goes.

And so I don't know how or what that’s going to work. It could be a faith-based organization goes yeah; you know what? These are the principles of our religion, so let’s see if we can help this idea get going. I don't know how that’s going to work, but somebody, somewhere will pick up the threads.

And then there’ll because, hopefully, there’ll be a political will, a revulsion against another corrupt exploitive, parasitic hierarchy, and there’ll be a political desire for decentralized, anti-fragile system that everybody – that can benefit everybody that’s a participant and not just a few at the top.

Chris Martenson: How do you go about getting people to sort of engage with this sort of idea? I'm beating around the bush. You know, Charles, there's a lot of people out there who’ve gotten kind of used to not working, not working hard. Maybe you don’t even know how to work or work hard because they haven’t actually done it yet in their life.

So I'm interested that you started, or there's at least a part of your book that says here’s who I am, and I'm sure when I read it I'm going to say, oh, my gosh, look at all the things you’ve done. You’ve probably sheet rocked a wall and put some wiring in and built something and run a business and on and on and on. Which collectively gives you a framing that says it’s hard work, but it’s doable. Persistence and thoughtfulness can get you far.

Are there enough people who understand those values and have that experience to pull this off? Do we have critical mass here?

Charles H. Smith: Yeah, great question, Chris. And again, it goes to your point about incentives. What are the incentives in this system? So obviously, humans are generally like if we use fewer calories and get more calories, we’ll do that.

So if there is still a government giving away free money and you can use the money to buy a bunch of stuff then no one’s going to join something like mine. And not no one, but fewer people will because there's some alternative.

But when that system breaks down, just like the bread and circuses in Rome – and here again, perfect example. The wealth of the Empire was squandered on circuses, right. These enormously expensive things with a lot of bloody action and feeding hundreds of thousands of people, giving them free bread in the city of Rome, which had basically been shipped across the Mediterranean from North Africa at an enormous expense. I mean, entire fleets of ships had to be build and maintained in order to feed the quarter million people who got the free bread.

So that system was super fragile, and so was the system supporting the whole Roman infrastructure. So when it breaks down, then what? Well, you no longer have an option of getting the free bread. There's no more free money.

So now what do I do? Well, then you have a different set of choices. So my system is not going to really catch on until the free bread and circuses have gone away. And at that point, then people will start making different decisions, and they’ll say well, gee, I really want to eat still; I still want shelter, and I can’t get that on my own, so I'm going to have to make some other choice.

And so then it’s going to be joining the brigands, the thieves in the forest, or you can lay down and die, or you're going to have to join some other group. And in the post-Roman era, in the western Empire, then you can join a group of people serving a monastery or something like that, or you can join a Germanic army.

So there's always options, and it’s just like the question is are you going to create one, or are you going to have to join one that’s another rapacious, parasitic hierarchy because, of course, there's always going to those around. There's always going to be somebody that’s going to try to recruit slaves or serfs to do work for them and skim the money. So what I'm saying is if there's an alternative that’s better than people will eventually choose that.

And I think what I really like about my idea is because I worked in a lot of different jobs, not everybody is super talented. There's a lot of people who have physical or mental disabilities, and yet, there's always work for people. In other words, you can tend to animals. You can kind of watch the kids. You can sweep the sidewalks.

I mean, there's a lot of work that’s actually useful that doesn’t require the kind of insane drive and brilliance that we think of as well, you have to have these characteristics to do something useful. It’s like no, there's a lot of – most of the work that’s performed on the planet is actually very simple.

And so, if we started paying people for doing that work that’s useful, well then they’d have money, and they might actually find that they like belonging and being needed.

Chris Martenson: Warren Buffet had a great quote that he said when he hires people he’s looking for three things. He’s looking for energy, intelligence, and integrity. He said, “If they don’t have the integrity, they’ll kill you with the first two.”

[Laughter]

And so this brings me to a comment I have about A I. So I'm of two minds. One the one hand, I don’t like how it’s been used because it’s mostly been used to sort of hack people’s – in a bad way – hack people’s wiring to sell crap. I don’t think that’s a great use.

The other mind that I hold it, though, is that we’ve now created a world where there's eight billion people, give or take, and it’s too complex. It’s too complex for ordinary human wiring to get through.

Like we have AI now that can land a rocket on a barge in the ocean. There's no human pilot that can do that. So in an equivalent sense, AI could be that thing if we're going to – if we're going to pierce through it, I technology is going to come with us for the ride, we're going to have to find a way to use the AI to help us manage things that we no longer can manage for ourselves because we're too slow, or we're too irrational, whatever the story is.

So that’s a place where I could see AI coming forward. And it kind of full circles like why did people – why was peoples’ behavior of higher integrity and more constrained a long time ago? Well, it’s because they lived in a village of about 100 people, and you couldn’t get away with anything because everybody was in everybody’s business. AI is kind of that thing now.

I think the anonymity of sort of the citification, the anonymity that people have – all I know is that when people have anonymous personas on the internet they act badly.

So to the extent to which the system now becomes – you create a system where people are no longer anonymous. And given that, though, and if everybody knows it’s a fair system, everybody has to play by the same rules, then people want the next layer up that, which they want that meaning and purpose.

And once they achieve that meaning and purpose, it builds on itself, and it goes from there, but you can’t have nothing at the base is what I'm trying – that’s what I feel like our culture has for a lot of people. Nothing at the base.

I work at Wendy’s or McDonald’s or Burger King, and there's just no meaning or purpose to this, and it feels unfair, and so therefore you never make it to the next level in that story.

Charles H. Smith: You're so right about that, Chris, because we can call that upward mobility or social mobility where – you know, ideally, every human being has a path to something better. Now, that could be a lot of different things depending on each person. And so does our system enable that? And we look at the people who rise to the top and we go oh, yeah, we live in a meritocracy.

But actually, as you're kind of pointing out, the meritocracy window is narrowed to such a tiny hole now that even getting a PhD doesn’t guaranty you some kind of secure well paying job. Even in the sciences, right. I mean, so every ladder that people had and were told oh, climb this ladder and you're going to have upward mobility, every ladder has been broken.

And so now it’s like this almost impossible to get ahead. And also, to get ahead as an individual. Like in other words, it’s not just about making more money. It’s like how do I fulfill my potential or my talents or my interests?

And so in our system, I call it – it’s just hit or miss. Like some people succeed in doing it, but the majority don’t. And so what I was thinking is why don’t we have a system that more or less guarantees the opportunity. Not the outcome, but it guarantees the opportunity.

And so to go back to your thing about AI, I think what we're talking about is are we serving AI, or is AI serving us? And if AI is serving us, then it would be used in something like my system where, as you say, once it’s controlled by corporate hierarchies or government hierarchies then we're serving it because it’s just another tool of exploitation and predation.

So will there be a change in the values of society after the complexity goes away? And I think people, as you say, people want fairness, but they don’t know how to get it, and so they're enraged, right. They're frustrated, disgusted, enraged and hence, they want to just go break some windows. We're in that stage now.

So what I hope is whether it’s my idea or somebody else’s idea, it’s like we need to have something that people can look at with hope and say well, actually, yeah, that system would work. that would work for me, and it would work for my community, and it would work for the world. Let’s talk about doing that.

And I consider that very likely, actually, if we can get it out there.

Chris Martenson: If we can get it out there. Well, it’s in Hacking Teleology. And so I would advise people to get that book.

Charles, I'm going to be personal about this. How do I get my hands on it?

Charles H. Smith: Okay. Well, if you go to oftwominds.com, I’ve assembled like an excerpt, a series of excerpts from the book. So you can read a pretty good chunk of the book for free, and then you can decide if it’s something that interests you. And then, you have to order it through the company store, otherwise known as Amazon. Because I can’t get – nobody will publish my book except if…

I’ll just give you a quick – most readers don’t know this, but if you go to a small publisher, they're going to take most of the money, and then they're going to put your book on Amazon just like you would only you don’t get any money, and you no longer own the rights to the book. So when they stop publishing it, you're out of luck.

Anyways, I have my same reservations as everybody else about the company store, but at this point, that’s the only way I can get my ideas out there is through the company store. So you have to go to Amazon and buy it.

Chris Martenson: Amazon. All right. Well, that’s where you find it, and, of course, you get the excerpts at oftwominds. So check that out, everybody. Charles, thank you so much for writing the book. Thank you so much for your time.

I'm really actually personally very interested in it because this could be a testbed here. We're setting up a whole interesting thing is going on here on the homestead. So we have a community developing. It feels really good. We’ve got a bunch of people.

Last night was a fascinating night because we were presenting a bunch of ideas to the town planning board, and they loved all our ideas. It was a big lovefest.

But afterward it just felt really good because we had twelve people who are now assembled around this idea. So my brain is already turning to uh-oh, we already have a community, what’s the container for it? What are the rules? How are we setting this up? What behaviors do we want? Like I'm just already there.

So maybe we could find a way to implement some of this.

Charles H. Smith: Absolutely. I think, just in closing, I think all my ideas, to take what you and Evie and your colleagues are doing and rationalize it. You know, like make it a set of rules that somebody could login to something and create a group just like yours, at least the infrastructure of it and the rules that would keep it going in a positive direction, and they could get into that without having to reinvent.

And so that, I think, would be hugely powerful. And so you might be able to do that, just a simple kind of web based thing where anybody could start a group similar to yours.

Now, it may not be as effective or in the same field or whatever. But just to have that model and a step by step thing would be huge. So that’s basically my idea at the smallest level. and then you could say well, gee, Chris, if you had this model and somebody in the Congo or South Korea could login and create the same kind of group, that would be pretty neat, especially if there was some way they could connect and share ideas.

Chris Martenson: Well, indeed. That’s what the next year is going to be about is really starting to gel things like this. Anyway, we’ll stay in touch around that. Thank you so much for your time today.

Charles H. Smith: Thank you, Chris. It’s been a pleasure to talk about my work. But I hope it’s not so much my work. It’s like ideas that we can all go beyond, you know, at least as a starting point.

Chris Martenson: I heard you loud and clear. It’s time to kick off the conversation. You kicked it off, so consider it started. And I'm like you – you might have the best idea out there and that’ll be great. And if there's a different, better one that comes along, that’ll be great. I think this is the stage of history where we're just going to have to try, try, try. I'm a rapid prototype, iterative kind of guy.

So there's so much more value in getting things started and kicked off and at least moving than there is in analysis, paralysis, and all that other stuff. So we got to start trying some of this stuff. It’s kind of eleventh and a half hour.

Charles H. Smith: Okay, Chris, well thank you so much. Really appreciate it.

Chris Martenson: The pleasure’s been mine.

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65 Comments

  • Tue, Sep 22, 2020 - 10:06am

    #1
    Congero1

    Congero1

    Status: Member

    Joined: Mar 10 2020

    Posts: 1

    6

    Crypto

    Simple question. It was mentioned in the video that crypto could be the "new" system. I know this is being closely looked at by many governments too. The question is, wouldnt you have some concern about big brother managing that new system? The way I see it, if the money system all goes electronic, that concentration of power only goes up. Theoretically, the government would have near full control of everything at the push of a button, no?

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  • Tue, Sep 22, 2020 - 12:05pm

    #2
    VTGothic

    VTGothic

    Status: Bronze Member

    Joined: Jan 05 2020

    Posts: 261

    3

    Discouraging and Encouraging

    The longer I listened to this conversation the more discouraged I felt.  But by the end I noticed the encouraging ray of hope running through it.

    What I found discouraging is that it's pretty obvious to anyone significantly involved in the cryptosphere that Charles wants to reinvent the wheel.

    First, let me point out that there is a long modern history of "community money" arising in locales for very local trade that bypasses the larger economy while greasing the wheels of small local entrepreneurial work and local labor. It's particularly vibrant in pockets in the northwest. If that were all he's after, it exists and there are articles and books written about various ways it's been done and how to do it for one's own community.

    But Charles goes further, envisioning some pan-local network of such communities learning from and trading with one another. So his conception needs another level; the coinage needs to be pan-local, yet not managed by some elite that can bend it to their advantage at the expense of the people actually doing the work.

    But there, too, he's reinventing the wheel. This is what the cryptoverse is already doing. He doesn't need to invent a new coin protocol, he just needs to apply one that already exists. I think he could fruitfully look at the Ethereum platform, for example, that allows the development of coinage and associated contracts by which the coinage is released when the contact is fulfilled. The Ethereum platform will let anyone design a new coin with its own rules. And already there are prototype programs to let these coins interact with one another; an agreed relative value between two or more communities about each group's coin's value would complete the linkages. There ya go. But, hey, that's just begging for the existing fiat system and arbitrage all over again.

    Also, Ethereum isn't really decentralized, which Charles says is an important element. When it comes to crypto, there is only one truly decentralized, democratic, from-the-bottom-up coin, which began with people voluntarily and with great passion pursuing exactly the vision Charles is coming to like a latter-day saint. That, of course, is Bitcoin.

    Charles objects to Bitcoin even though it hits every concern he raised, and meets every interest he expressed. He faults it for being generated by miners rather than arising from "labor." Clearly he doesn't understand the role of miners. It is, first, to create and release the coin on a scheduled basis over a long period of time. Anyone can become a miner, so there's a democratic element to it. But because of the schedule, throwing more mining power at the task of creating more Bitcoin doesn't increase the rate of coin creation, because the algorithm that has to be solved to reward a miner with a coin automatically adjusts - also on a regularized, predetermined schedule - to account for the computing power being thrown at the process.

    In addition, there is nothing miners can do about the fact that there is built in a total number of coins to be mined, after which there will be no more mining. No amount of computing power will change that. It's what makes Bitcoin a true hard money; ultimately the hardest (scarcity principle).

    Now, as miners sell their coins into the system, they earn the money to keep their computers operating, which is how the "AI" of blockchain keeps going. Someone has to pay for the computer time, whether in Charles' new system or in existing Bitcoin. Charles hopes for some benefactor who feels guilty about how much s/he has made in the extractive economy to want to fund getting his new system off the ground. He uses the sum of $10 million as a "for instance."

    That's nowhere near enough for a pan-local system. Yes, it might get a local or regional system off the ground - but barely. Any computerized system that takes off beyond the local level is going to require hundreds of millions of dollars of computer equipment and power to operate efficiently to track and reward millions of people's "labor," and provide them the (in Charles' system) democratically approved number of coins. The Bitcoin system is estimated to be worth several billions of dollars of realized investment already. It would take at least that much to duplicate its reach. Yet, thousands of individuals at first, and then consortia later, put up their own money in good free-market style, and either made a go of it or failed. Either way, they built out the existing system. It's so large now that no one - not even a country with the wealth of the US - could afford to finance its duplication.

    Who is to pay for Charles' system and its electrical use? Are the people operating his system - or just maintaining the various nodes and troubleshooting issues - engaged in "labor" by his definition? If so, why aren't miners?

    Also, how do we assure that the people in Charles' system don't corrupt the AI protocol to benefit themselves, or to seize monetary control? They are the weak point; the point of systemic power, and therefore will attract the sociopaths. Charles wants to rely on the good graces of an angel investor at first; and then he "hopes" for some emergent ethos or group of ordinary people who will arise to prevent anyone or any group from corrupting the system.

    Talk about "hopium"! I'm remembering that Google was founded on the principle "Do  no harm." And I remember seeing an interview with Eric Schmidt, back while he was CEO of Google, on TV with doubtful Glenn Beck assuring Beck and all those watching that there was simply "no way" Google could ever do anything bad because "it's just  not in our corporate ethos." How's that working out?

    Bitcoin is immune to that kind of outcome because of the wide dispersal of the system. There are an unknown number, but known to be over 10,000, computer systems spread around the world on which the blockchain protocol operates to prove the algorithm that adds a block to the Bitcoin chain, and it's all open source and transparent; there's the integrity of the system. There is no pinch-point; there is no place at which someone can take over the system.

    The miners facilitate the system's development; that's their "labor". They don't control it. They do the "good" of gradually releasing coin into the ecosystem according to an immutable predetermined schedule they cannot cheat, to create a liquid, hard money regime as the ecosystem builds out and increasing numbers of people join the usage community.

    Yes, today there are a lot of people in Bitcoin who are holding coins as an investment, because they rightly expect the value of each coin to skyrocket as the number mined slowly reduces and the demand for coin increases. Never-the-less, that's only a function of building the system to a sufficient level of expansion and adoption that provides the liquidity a successful money system has to have, especially if it's meant to be pan-local. The day will come when people don't buy Bitcoin but earn it for work performed, and pay it out for work or goods received. In fact, that day is already emerging: there are increasing numbers of people who are paid in Bitcoin for their daily labor. Those people then have to spend some of their wages to purchase the items they need and want - and that is how a new economy is created. It's happening.

    Furthermore, because of how Bitcoin is designed, it has all the privacy (another key feature Charles wants) of a current fiat cash transaction. It can have even more privacy than Charles envisions for his ideal money - and it can exactly match his ideal, too. The great thing about blockchain as a protocol is that it allows those who use it to control their own data, and to release only what they want to release and only to those to whom they want to allow access.

    There is nothing Charles wants to do that isn't already done by Bitcoin and the blockchain that makes it possible. And it does it better, by eliminating the obvious pinch-points Charles seemingly can't see a way past except by trusting to the good graces and noble intentions of human actors.

    Bitcoin, by contrast, does not need to rely on hopium, nor to believe in the (demonstrably non-existent) natural goodness of the human soul.  It is both disappointing and frustrating that he doesn't understand, and that Chris apparently fails to grasp as well, that the new monetary system that dethrones sociopaths, democratizes the economy, and empowers ordinary people to make and keep their wealth has been right under their noses for a decade.

    I can hypothesize that the economic drama of the Bitcoin birth process has blinded them to what the project is all about - as if starting up any new money can be done without a roller coaster ride of acceptance and rejection, especially one that's emergent from the constantly churning chaos of ordinary people operating on ordinary mixes of greed and altruism. But guys, c'mon. It's time to update your respective understandings of what's going on in the crypto universe as a whole, and also in regard to what Bitcoin really is beneath all the drama of its birthing process.

    On the other hand: that this conversation even took place inspires hope. It suggests a new level of openness, and that's the prerequisite for seeing more clearly and understanding more deeply.

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  • Tue, Sep 22, 2020 - 2:47pm

    #3
    Mohammed Mast

    Mohammed Mast

    Status: Silver Member

    Joined: May 17 2017

    Posts: 778

    1

    Just Dropped in to See What Condition my Condition is in

    Not much new here. Utopian ideas. Lack of understanding of BTC. And lack of interest in the hunker down gold bug militia.

    Going back on vacation.

    Nice post VT

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  • Tue, Sep 22, 2020 - 4:36pm

    #4
    Mots

    Mots

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    Joined: Jun 18 2012

    Posts: 266

    8

    Hackers Teleology uses AI in new/humane ways: not another energy intensive, arbitrarily limited Bitcoin

    Reading the Bitcoin gushing here is a little to me like listening to religion.
    The Hackers Teleology is about using AI for a number of things that go beyond accumulating a crypto in one's account out of reach of authorities.
    Charles personal-history filled book explains the cracks in the system and points out areas that can benefit from AI to provide real value for real labor, which is denigrated presently by our society wherein financial gamesmanship and getting rich quick by not contributing (which includes most of the bitcoin discussions these days) are minimized by proper application of AI.  In this context, comparing Charles's AI proposals to a limited resource based on extreme consumption of electricity and primarily feeding the free-shit something for nothing bitcoin story is not justified.  For starters total bitcoin volume and valuation is not related to value added work.  That is a fundamental premise of the Hackers Teology.  And looking around the *coin blogosphere, the only labor backed cryptos that I can find are loss leader activities used to entice clients to use financial services for payroll service providers, without any notion of an AI structure to address the problems pointed out in the book.

    You have to read the book.

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  • Tue, Sep 22, 2020 - 5:50pm

    #5
    vshelford

    vshelford

    Status: Bronze Member

    Joined: Jul 13 2014

    Posts: 165

    21

    what am I missing?

    It has always seemed to me that the weak point with bitcoin-type currencies, is the demand for electricity for it to work.  If we are truly looking at a breakdown of the system, won't part of the system breaking down, be the grid?  Haven't there been losses already, where peoples' "wallets" disappeared?  I have a problem getting involved with things that don't make sense to me, and I'm afraid digital currency is one of those things.  That's not to put it down, just saying I'm not understanding the attraction.  In a small community, barter, exchange of whatever currency works for the person you're dealing with, and even just free stuff, keeps a lot of things afloat.  We have a virtual noticeboard where anyone needing something for a project can put it out there - "anyone have some spare fencing wire?"  "I've got too many tomatoes and they're going bad - come on over and pick some."  "I need something picked up in Victoria - anyone going down there this week?"  This works SO well - it's the very essence of the trust that a small community operates on.

    So I guess I would say, the primary currency is trust.  Everything else is dressing.

    Having said all that, I did enjoy the conversation.  It made me want to recommend again Dmitry Orlov's description of the collapse of Soviet society.  Extremely instructive.

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  • Tue, Sep 22, 2020 - 9:36pm

    #6
    psebby

    psebby

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    Joined: Jul 04 2009

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    8

    Compare to a Time Bank or LETS system?

    I read the whole interview but I haven't had a chance to read more details about the economic system that Charles is proposing.  I love the idea of treating everyone equally and totally agree that it's good for us to experiment with these systems now to get some of the bugs worked out before they become critically needed.

    If we set aside the whole crypto/AI element, it seems the core of the proposal is that people do some work in their community and get paid for it in a local currency, which is exactly what a Local Exchange Trading System (LETS) or Ithaca Hours system or a time bank is - these were (are?) popular in many towns starting in the 1980s.  Can anyone compare/contrast these systems with the one that Charles is proposing?

    A local currency is very interesting but I've also read reports of how it takes a lot of effort to make it work in practice.  Just one example (from Ithaca Hours, I think): some very popular businesses (e.g. the food co-op) that accepted the local currency accumulated many more currency units than they could use because many/most of the co-op's suppliers didn't accept the local currency.  One guy had a nearly full time job just thinking up creative ways to keep the currency moving so it didn't just sit there in these popular businesses. (Of course, in a collapse scenario, that might not be a problem because everyone will probably jump onto the local currency bandwagon.)

    A variation on LETS is a time bank where the unit of "currency" is an hour - e.g. performing a service for X hours or making something that takes you Y hours.  Most time banks honor everyone's humanity by counting everyone's time the same - no type of work is given more units of credit than another - and people are encouraged, over time, to give about as much as they receive so their balance of hours doesn't get too high or too low.  The hOurWorld online system (hourworld.org) says it's framework is supporting time banks in 380 communities with a total of over 45,000 members.

    I helped set up a time bank in my community during our Transition Town years; I modified some open source software to make a web-based system for our members.  A few dozen people used the system and many people liked it a lot, but it didn't get much traction in the community - it's hard to explain exactly what it is, what it is not, and why it's a good idea to the general public - so our time bank didn't get a critical mass with lots of variety in goods and services and it's no longer active.

    I still remember one meeting when we were organizing our time bank.  We decided to ask our members for a small one-time fee in U.S. dollars (something like $5 or $10) to support the system (web hosting fees, advertising, etc.) and to encourage people to have some buy-in.  In exchange, we credited each new account with 25 hours so they could start getting services or goods from other people right away.  Anyway, at this meeting I realized that we were our own "Fed" - we could credit people with 500 or 1000 hours if we wanted to, or give people more credits every year... who cares? All it means is that people have more credits to mediate exchanges with their neighbors.  A local currency (whether in dollars or hours) avoids the Depression-era problem where some people had goods and other people had needs but there just weren't enough U.S. dollars to mediate the exchanges between people.  And giving away credits encourages people to use their hours, not hoard them - which means they're contacting other people in the community, chatting with them, making exchanges and new social connections.

    A few other points:

    1) Our time bank supported both "offers" (goods or services you were willing to give) and "requests" (things you'd like to get but are not being offered by anyone).  This helped people see where there were new opportunities to provide an in-demand item.

    2) A time bank or LETS can be web- or app-based today but can pretty easily become low-tech as complex systems break down.  Some people ran these systems years ago where members telephoned their offerings or their requests into a central person who typed them up and mailed them to all the members.  Or we could have a few people who host the system in an office in the middle of the communty with a huge whiteboard that records the offers, requests, and the account balance of each member.

    3) Today, bartering partners are supposed to report the value of their trades to the IRS as income, but you can run a time bank (IF you value everyone's time equally) right now without this problem because the IRS has specifically ruled that time bank exchanges are not bartering and need not be reported as income. [But I'm not a lawyer, so there may be exceptions.]

    Looking forward, every service that the government can no longer provide becomes an opportunity for us regular people to step up and provide a similar service in a creative way.

    Paul

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  • Wed, Sep 23, 2020 - 1:33am

    Yoxa

    Yoxa

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    Joined: Dec 20 2011

    Posts: 316

    5

    How to account for differences in skills?

    >> Most time banks honor everyone's humanity by counting everyone's time the same

    Is any allowance made for the fact that an hour spent doing some jobs could only happen if the person spent many, many hours on skills development first? Not to mention the cost of tools or other overhead?

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  • Wed, Sep 23, 2020 - 3:45am

    #8
    Fredrik Lidman

    Fredrik Lidman

    Status: Member

    Joined: Mar 31 2009

    Posts: 21

    5

    Governance of a community in a second wave

    Charles och Chris,

    Thanks for sharing a topic that happens to be in the center of my radar screen. I've downloaded the excerpt, ordered the book, and made a donation to the oftwomind-site. I simply want to encourage you Charles to continue with your service as a great independent thinker.

    The reason why this topic is in the center of my radar screen of attention, is that I'm the chairman of a foundation that has at its core to create a community for the future. The foundation was founded approx 25 years ago with the acquisition of an old farm property in the Skåne region in Sweden. A community was formed with a very resourcefull leader in the centre. Lot's of extremely hard work has been put in by many people over the years on the land, in the buildings and in the infrastructure. What has been built with limited resources (private donations and cash-flow from the "business"-side of the foundation) is impressive.

    The whole "project" has lost steem in the past 10 years. The founder has developed health problems. Many have lost "faith" in the whole idea and left. Pursuing an alternative path to the existing societal set-up and norms, is a very, very demanding path to follow.

    We are now entering into a second wave in our development as a community. One aspect of that development is that we are starting to reconfigure the set-up of governance. We had in the first 20 years one Foundation that catered for all issues: Living, rules for the community, all the different businesses (restaurant, two shops, yoga-classes, B&B, conference, health treatments, etc). I truly think that this was needed in order to get sufficient focus for the first wave. But the "running out of steem" has indicated for me that we need to reconfigure this monolistic construction in order to even have a chance for a second wave of development. In the past year, we changed this set up with creating a central governing Foundation that effectively has the power of all four legal entities (in the past 5 years 3 more legal entities have been formed). The power in the end is exercised not via ownership but via the "statues" of all the legal entities. So the central foundation in our case has the full control of who is part of each legal entities board of directors and the statues of each. We've also created an Association in which all the legal entities are members. This Association is a forum for power sharing and idea-generation across the "sphere". This Association has as one, of many features, the power to "kick" me as chairman of the central foundation. We had our constituent meeting in the Association on Zoom just two months ago. It felt as such a relief for me personally that this Association came to live before my eyes on Zoom.

    What I'm looking into now with two colleagues in the central foundation, is to create a vehicle for the community that is separate from all the other legal entities. Our initial hypothesis is that we will design an Association for all the people that live on the property. I want that Association (for private people) to have lots of power. That Association will probably also be a member of the Association for all the legal entities.

    Perhaps some of you think we are just creating a complicated mess of something that you should just keep simple. You might be right. 🙂

    My answer to that argument, is that we kept it "simple" in the first 20 years with one legal entity. But it lost steem and can not be reinivigorated unless we change the whole set-up of the governance of the community.

    There is much more to say about what we are trying to do. I hope that this site will even more focus on the experiments in creating the new. I understand that many are interested in the failings of the old, and gets upset of the craziness of different actors behaviour in the current system. I personally have moved on from that, to exactly the exciting topic you scratched on in this discussion. Keep on with that great work, Charles and Chris!

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  • Wed, Sep 23, 2020 - 4:31am

    #9

    sand_puppy

    Status: Platinum Member

    Joined: Apr 13 2011

    Posts: 2436

    9

    Communities and the Charismatic Leader

    My experience with communities have all centered around a charismatic leader.  The leader held the vision, decided things, and was the interpersonal glue that held things together.

    But personality conflicts eventually arose.   The leader-follower glue (mostly admiration for the leader) came loose and the communities splintered.

    The problem is worse if the leader is smart, well liked, and has a charismatic personality.

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  • Wed, Sep 23, 2020 - 5:38am

    Oliveoilguy

    Status: Gold Member

    Joined: Jun 29 2012

    Posts: 826

    6

    AI vs. DI

    AI.....vs.......DI?   maybe instead of artificial intelligence we need guidance from Devine Intelligence. Is the religious model so crazy or archaic?

    There is a sub society in our small town that operates on volunteerism, gifting, helping, and many non-selfish modalities. Is hard to quantify this in monetary terms which is probably the reason that it works so well. The example of good deeds is very compelling and when someone truly gives without the expectation of receiving something in return, it is a very powerful action. And it’s breeds more good action. This does not replace the laws that we live under, or the government but it is a powerful sub-culture. The existing “dollar” system undergirds this and is a necessary evil but most of the local effort tries to bypass the strict pay-for-labor.......or pay-for-service when possible.

    If the shit hits the fan (do I smell something?)......My spiritual intuition and guidance will tell me to choose my associations based on Devine Intelligence. Who is following a path of charity? Compassion? Honesty?  Who do I want to associate with? This type of vetting creates a powerful society.

    I don’t need another human construct to guide my life. There is a good roadmap to follow already. Unfortunately.......Yes ........we still have to “give to Caesar what is Caesars”

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  • Wed, Sep 23, 2020 - 6:03am

    #11
    VTGothic

    VTGothic

    Status: Bronze Member

    Joined: Jan 05 2020

    Posts: 261

    4

    This is an intriguing conversation...

    ...and close to my heart. I have a couple comments, from reading the discussion so far.

    1. Extrapolating from my own limited experience with local currencies, vshelford and psebby have it right. So much is dependent upon local trust and shared good will to make the typical local currency concept work. The great thing about such systems is that they are self-selective: those who want to work cooperatively and to value labor equally are drawn to such projects while those who think it's all b.s. steer clear. So, in general, it works at a small and local scale - within the limitations psebby points out: some (critical) resources become repositories of lots of scrip, which is not as liquid as needed in order to trade outside the local setting. That is part of my critique of Charles' presentation.

    Joel Salatin could set up an internal scrip to lubricate transactions at Polyface Farms between the various entrepreneurial ventures he has helped his family/tribe incubate there, if he wished, and it would work pretty well internally. Not well externally. Chris could do something similar with his emerging endeavor. Again, it wouldn't work off-campus, although he and Joel could possibly work out an exchange regime that uses their shared LocalScrip for trade between their two communities. Neither would find many, if any, local merchants who had much appetite for their scrip, unless those local merchants were purchasing products from their communities to resell to the general public. In that case, those merchants would be the final arbiters of the value of LocalScrip, and it might very well be different from product to product and merchant to merchant.

    Really, as vshelford notes, this is a formalization of the barter board. I think it's a great concept, but it works as well as it does (when it does) as a secondary market, not as a primary.

    To reach outside the local, self-selected, insular community, what's needed is a pan-local currency. If, as Charles proposes, that pan-localism is going to be international in scope, that currency has to have universal attributes; even in a closed system of sharing between self-selected groups separated geographically there will be necessary touch points with non-participants - shipping, for example. psebby's example of needing to buy in food for the popular grocery store is another case. Similarly, feedstock garnered from outside a community to grease the production of goods made available within the network will be a constant need until/unless the system becomes highly adopted, hence the scrip becomes highly liquid.

    The problem is getting from here to there. How does that happen in fact, not fancy? Let's not gloss over that process; it's crucial. If it doesn't work at the granular level, the whole project collapses. So it can't rely on the good nature of self-selected community members. It has to account for the full array of human behaviors and motivations - for the sinners as much as for the saints, and perhaps more for the sinners because they're not saintly.

    As I said, Charles appears to propose reinventing the wheel. This work, this experimentation, is being done. Ethereum contracts are being designed just for this purpose: no time-sucking community deliberation about the proposed value of each kind of job is required; rather, two or more people agree to trade value, they agree on the terms of the exchange and execute it by way of a digital contract that verifies the parties meet the terms before it releases the associated counter-value.

    Charles doesn't need to create a new system for that, he just needs to understand Ethereum. He also doesn't need some repentant financial angel to get it up and running; the platform exists, internationally, ubiquitously. And, hey, for those who see something malignant about Bitcoin, it doesn't require any Bitcoin!

    I'm saying Charles' book (assuming it hews close to his presentation here) would be better if its purpose was not to propose some new scrip to liberate us from fiat currencies and State dictat, but introduced some practical ways to use Ethereum - or some similar extant platform - to facilitate non-fiat transactions. It could be vshelford's barter board, applied locally or internationally with equal ease and in a truly free market way.

    2. All the same, mots is completely wrong to assert that the point of Bitcoin is to get something for nothing. The whole point of the cypherpunk revolution that led to Bitcoin after several failed predecessors was to lock out "something for nothing" in favor of "something for something." Key to that transformation is scaling up quickly and broadly. Without scale, any alternative collapses.

    The issue is how to get broad, non-niche adoption fast enough to sustain the upfront costs of scaling. Idealism is a great motivator - and that does require what mots denigrates as religious fervor. I submit that the only way Charles' proposal will work is if enough people develop enough religion-like commitment to and faith in the project to stick with it through thick and thin, for better or worse, until it solidifies. Kinda like what's happening among the "Bitcoin maximalists." But like the Bitcoin true believers, those who hang in there with Charles' LocalScrip will not be doing it for the money they make or lose in the process, but because of the vision they embrace, with a tribe of like-minded believers, of a better world.

    Of course, some people will get into LocalScrip out of pecuniary interest. Some will see in the early days of its adoption the potential to ride a wave of embrasure that promises a future payday. If LocalScrip starts to catch on, some smart investor-types will figure out some scheme to arbitrage LocalScrip, to use it as collateral for loans in dollars, or to run futures contracts. Will that then invalidate the LocalScrip project? I don't think so; I think it would be a sign of the project's promise and maturation. It would mean it is, indeed, moving beyond a niche preoccupation and is entering into the mainstream, where it can actually change economic lives on a large scale.

    So mots is right that at the moment we see people speculating in Bitcoin: buying in and holding with the anticipation of making a profit when the coin's price goes up. Which it will. But here is the essential element I've tried to express: that works only as long as Bitcoin (and by extension, any alternative money) is priced in another "coin of the realm."

    Today, the value of Bitcoin is denominated in one or another fiat currency, which is why it's treated as a commodity. Perhaps someone can explain to me how to get away from that at the beginning of any scrip. Even in the LETS programs psebby referenced, people were making at least mental calculations of the value of a local scrip in terms of dollar equivalents. Certainly the grocer was; as would, also, the local carpenter who had to buy wood from outside the system.

    My point is that the scrip used in such systems always represents some fiat currency even if it doesn't use that currency, and anyone who would think they were being undervalued for the work they performed would argue in terms of "my work is worth more dollars than this allocation of LocalScrip recognizes."

    As far as I can see, this kind of comparison is endemic to developing an alternative. Even the famous purchase of Manhattan Island for wampum is debated in terms of "about $24 worth of beads." But if your local currency is beads, that's not $24, it's a fortune in local monetary units.

    The moment that LocalScrip, or Bitcoin, becomes stand-alone money - a true alternative to fiat currencies - is when people can sustainably buy and sell in the scrip itself; when it has broad enough adoption that people stop calculating its value in dollars or yen or rubles, and simply give and receive it as valid payment for goods and services. That happens when those parties to the transaction have confidence they can turn around and spend the coin for the things they want and need. Hence, broad adoption is key, and that only happens if people outside the original "true believers" find a self-interested reason to embrace it. Greed, ie. acquisition of some kind, is certainly a powerful, very human motivator, common among early adopters and risk-takers.

    If I understand Charles correctly, what he wants to do away with is the current financialization of money. He wants to end the rent-seeking games that steal money from the productive people for the pockets of the leeches who don't contribute real value to the economy in exchange for their outsized rewards.

    The best means I know of to prevent that gratuitous rent-seeking is a hard money. My worry about printing LocalScrip according to productive labor - which is what Charles seemed to be suggesting (although I didn't hear him clearly say that) - is that it's dependent upon the good will and angelic nature of the persons in charge to prevent inflationary printing. After all, the rationale for unpegging from the gold standard was to facilitate liquidity in the rapidly growing US economy. GDP was to be the new peg for the dollar. And if dollars were added and subtracted from the economy based on GDP expansion and contraction it could conceivably work. So what went wrong?

    Yep. Why would that not also go wrong with any new non-hard money regime? Control of the money-printing press would be a key pinch point, attractive to the sociopaths.

    These considerations really did go into the design of Bitcoin. They were primary concerns of the cypherpunks, and Bitcoin's ability to solve the problem through it's hard money creation regime (total cap, regulated release, scheduled reduction in mining's unit-value) is a very large part of the reason the early "believers" - who, let's not forget, torpedoed previous efforts - believed in it. It's why they still do, despite the less-than-angelic market-driven, rent-seeking masses who have entered into the space. The rent-seekers' ability to milk the system is an interim phenomenon. It has the benefit of encouraging wide adoption that democratically finances the infrastructure's build-out. But rent-seeking reaches a ceiling when all of the Bitcoin is mined. From then on, rent-seeking on Bitcoin is no more (or less) possible than is rent-seeking when gold is backing every dollar printed.

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  • Wed, Sep 23, 2020 - 6:56am

    #12

    LesPhelps

    Status: Silver Member

    Joined: Apr 30 2009

    Posts: 639

    4

    Dark ages first, rebuild second?

    A few issues categorize this discussion, at least in my mind, as a distant future option.  First, as everyone knows, we have a rapidly dwindling resource issue, along with a growing environmental dilemma and not just climate change.  Second, 7.5 billion people is not an ideal number on a planet with dwindling resources and an already compromised environment.

    My short term expectation is that people and governments are going to dig in and fight over what is left, further depleting resources and causing even greater environmental challenges.

    The other thing I see when I look around is that the majority of people are not capable of participating in the society discussed, nor would they willingly give up the lifestyle they have lived so far.

    Lifestyle induced chronic health issues have become the norm in modern society.  High energy lifestyles are the norm.

    From what I can see, it is going to be an incredibly painful and long transition.  I personally don’t expect to see the solution in my lifetime.  I doubt my children will see things turn around.

    Charles, there are more than a few people who live around me that would not be familiar with the word instantiate.  They will have to be accommodated in the new society, for it to work.

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  • Wed, Sep 23, 2020 - 7:19am

    psebby

    psebby

    Status: Member

    Joined: Jul 04 2009

    Posts: 9

    4

    psebby said:

    Yoxa: no, the time banks that I'm aware of do not take into account any special skills, training, or tools one might have. That keeps the system simple: one hour of my work time is the same as one hour of yours.  To do otherwise invites lots of calculations about the value of everything - and that value is relative for each situation, e.g. if someone cannot walk, the value of having someone come over and dig up their garden plot is very high, though other people might value that task very low.

    One way to think of it is that a time bank sets up a local service sharing economy, like you probably have with your immediate family and neighbors.  If you have a chainsaw and a neighbor needs a tree cut up, you'd be happy to help him out for free, and he'll probably help you out sometime in the future.  One goal of a time bank is to set up lots of these service sharing connections across a wider community, which builds a tight web of social connections and friendships across the community.

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  • Wed, Sep 23, 2020 - 8:02am

    #14

    Bill Bishop

    Status: Member

    Joined: Jun 10 2009

    Posts: 7

    1

    Time Banks using Blockchain

    A few groups have been looking at ways to combine the benefits of time/labor-based alternative currencies with the AI benefits of blockchain.

    Seva Exchange has partnered with TimeBanks USA and Andrew Yang to use exchangeable hours as an alternative digital currency. https://www.sevaexchange.com/

    BlendTBS by Binghamton University researchers: https://www.binghamton.edu/news/story/1874/what-are-you-worth-new-time-banking-system-utilizes-blockchain-tech-to-meas

     

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  • Wed, Sep 23, 2020 - 8:19am

    #15
    Mohammed Mast

    Mohammed Mast

    Status: Silver Member

    Joined: May 17 2017

    Posts: 778

    3

    Bill Gates: His War on Life, Vandana Shiva

    The Lilliputians are being wiped out by Bill Gates, Somehow I don't think "local currency" will make a difference.

    https://www.commondreams.org/views/2020/09/21/bill-gates-global-agenda-and-how-we-can-resist-his-war-life

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  • Wed, Sep 23, 2020 - 8:48am

    #16

    Jim H

    Status: Bronze Member

    Joined: Jun 08 2009

    Posts: 1206

    3

    On local currency systems

    This is a cool conversation being had here... we had the same conversations 8-10 years ago as well as I was first learning about the nature of money.  I did some research on the local currencies, one in particular called, "Ithaca hours".  You can read about it here;

    https://en.wikipedia.org/wiki/Ithaca_Hours

    I came to the conclusion, similar to what VTGothic describes, that these can only function very locally based on trust.  They in no way present a model that can have broader application for one simple reason;  Lack of scarcity integrity.  The creation mechanism behind the Ithaca hours was ill defined and non-transparent.  It functioned for a time based on the energy and evangelism of one person, then it died out.

    We all understand why Gold is useful as money (you cannot print it, only mine it) and how it's price is controlled, with varying success, by producing and trading paper equivalents that work to expand supply of, "Gold".  Regardless of the paper games, Gold does have true scarcity integrity.

    This is where Bitcoin comes in... it is a highly elegant solution to the need for a digital currency that has real, Gold-like scarcity integrity.  If a large enough cross section of the world's inhabitant's agree that it is money.. and we seem to have crossed that goal line years ago.. then it is money.  It's creation mechanism is completely transparent.  It is not dead money... it can hold and house information as well.

    The elegance of it goes beyond the fact that it has scarcity integrity - it extends to the fact that miners, who have the computing power, are motivated by the rewards of mining more, "money" for themselves while in the process maintaining and updating the blockchain.  Yes, this consumes a lot of energy.. but what is the price of Freedom?

     

     

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  • Wed, Sep 23, 2020 - 8:49am

    cindyb

    cindyb

    Status: Member

    Joined: Mar 21 2010

    Posts: 41

    5

    Take a Look at FIndhorn

    If you have not already, study the structure of the Findhorn Foundation in Scotland. They have developed a structure that seems to be similar to what you described. Findhorn (and The Farm, here in the US) went through the same energy depletion with loss and changes from the "leader".

    Findhorn has also developed their own local currency. It appears to be "bleeding" outside the community itself to local businesses. I think this could happen organically as the currency matures and the surrounding community finds it can be trusted.

    Ithaca, New York is another example of a successful local currency. I haven't read Smith's book yet but I would imagine that he has looked at these examples.

    I've studied the schemes as a part of my certification in Sustainable and Ecovillage Design and I am fascinated by them. As the dollar is devalued, as it certainly will be, I think the demand for time banks and local (state level?) currencies will become more and more attractive and useful. Time to get a leg up and get something started.

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  • Wed, Sep 23, 2020 - 9:09am

    #18
    Mohammed Mast

    Mohammed Mast

    Status: Silver Member

    Joined: May 17 2017

    Posts: 778

    3

    The Great Unbanking

    https://cointelegraph.com/news/the-great-unbanking-how-defi-is-completing-the-job-bitcoin-started

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  • Wed, Sep 23, 2020 - 10:51am

    Fredrik Lidman

    Fredrik Lidman

    Status: Member

    Joined: Mar 31 2009

    Posts: 21

    2

    Fredrik Lidman said:

    Thanks, CindyB!

    I will actually talk on Zoom, in a few minutes, with an old-timer that have been part of both Findhorn and some other communities across the globe. 🙂

     

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  • Wed, Sep 23, 2020 - 11:31am

    #20
    vshelford

    vshelford

    Status: Bronze Member

    Joined: Jul 13 2014

    Posts: 165

    6

    systems vs human nature

    This is a great conversation.  My two cents - systems will always be vulnerable to the infinite variety of human nature and the effects of individual experience.  In my experience, workable communities are organic and above all adaptive; they grow where the seed lands and manage with what they have to hand.  Sometimes preconceived and planned communities survive and flourish, like Findhorn, and hopefully like what Chris is working towards.  An alternative and/or supportive approach is to be what you want to see - not a charismatic leader, but a quiet server of the common good, taking only what you need and giving back all you can.  Gradually, when people see you (and others - one is rarely, surprisingly, alone in this) living a balanced, happy, well-fulfilled life, they are encouraged a bit along the same path.  There are upsets and misunderstandings and frustrations, but it's amazing how these pass, and the basic values survive.  But it does take that outlier, unselfishness, to keep the flow going.  You'd sometimes think unselfishness has gone the way of the dodo, but it's actually all over the place.  Downright inspiring sometimes.  Might as well count on it being there - somewhere, even if you can't see it.

    Edited to add: I doubt we will ever see a "planned system" effective everywhere.  The other side of human  nature attracts selfishness and greed to power.  The trick for the rest of us is to unplug from that self-serving "system" as much as possible, and insulate ourselves and those around us from its effects.  So we get pockets of sanity that eventually get to regrow and flourish when the sociopathic systems implode, which they inevitably do.

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  • Wed, Sep 23, 2020 - 1:02pm

    agitating prop

    agitating prop

    Status: Silver Member

    Joined: May 28 2009

    Posts: 458

    5

    agitating prop said:

    VT Gothic,

    It took you 21 paragraphs to express the complexities involved with bitcoin and how it is utterly opaque, so therefore safer. Really? It is perfect for corruption and illegal acitivity of all kinds, with the added 'benefit' of nobody, outside of the nerdiest person will be able to navigate it. Do I want to be my own banker. Are you kidding? The thought fills me with anxiety. I can't even locate my house keys some days, so forget that.

    No government is going to get behind bitcoin. A digital governmental blockchain currency...maybe.

    Some kind of currency that augments the dollar but is less goddawfully complicated than what you have proposed, is the way to go for most people. I don't know what that would be, but it should be able to withstand an ongoing blackout, as well.

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  • Wed, Sep 23, 2020 - 1:14pm

    agitating prop

    agitating prop

    Status: Silver Member

    Joined: May 28 2009

    Posts: 458

    5

    Your condition, Mohammed Mast

    Not much new here. Utopian ideas. Lack of understanding of BTC. And lack of interest in the hunker down gold bug militia.

    In response to "just dropped in to see what condition my condition was in."

    Your condition, Sir, is profoundly rude.

    CH Smith is one of the best minds out there. I have been reading him for over a decade and find him to be right on target...always.

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  • Wed, Sep 23, 2020 - 2:21pm

    charleshughsmith

    Status: Bronze Member

    Joined: Aug 15 2010

    Posts: 709

    3

    charleshughsmith said:

    Blockchain is intrinsically distributed and so it's difficult for a government to grab control of every computer with a piece of the ledger. This is especially true is some of the network is outside the reach of any government. I sincerely doubt Switzerland would allow the US government to grab control of every PC with some of a blockchain ledger on its drive.  That said, the government can make it illegal to trade or transfer a crypto within its jurisdiction.

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  • Wed, Sep 23, 2020 - 2:51pm

    #24

    charleshughsmith

    Status: Bronze Member

    Joined: Aug 15 2010

    Posts: 709

    10

    thank you for the many comments

    I can't do justice to every comment but thank you to everyone who added to the conversation. I'll make a few points.

    1. I'm not against BTC. I am a proponent of it as an inflation hedge (go to archives for 2016 article I posted here on BTC).  I propose a labor-backed crypto which is a different origination mechanism than BTC. Yes Ethereum might be the perfect platform, or maybe Decred, or other crypto platforms I'm not familiar with.

    2. I am fairly confident some existing platform can be modified to originate currency when labor has been performed and verified.

    3.  The concern about energy consumption and BTC is a valid one. Not all crypto platforms operate on the BTC protocol and so they use much less energy.

    4. I personally have never been part of any organization that depended on a charismatic leader.  Long-lasting organizations are based on shared values and a structure that generates oversight and accountability.

    4. My system is based on a well-established incentive structure: join if you want to contribute useful work and get paid. This is basically the same incentive model as a corporation, but nobody calls a corporation pie-in-the-sky. Why? Because it's organized around the greed of the owners?

    5.  the problem with local scrips /currencies and labor-hour banks is they aren't set up to buy goods and services from "the outside world".  A universal crypto with an inclusive market for goods and services from all over solves this problem.

    6. People tell  me nobody will want to sell anything for a crypto (other than the top cryptos). It all depends on scarcity and demand and the transparency of the market. Once global demand dries up due to the Global Depression that's just starting, all sorts of people will be willing to trade stuff for a free-floating crypto if that's the  currency offered by buyers. Take it or leave it changes the calculation of "value."

    7. It is a source of continual amazement to me that a community based economy and currency is quickly dismissed as an idealistic impossibility but a system in which thousands of people apply for work in an Amazon warehouse for grueling work and low pay, all of which serves one goal, to enrich Jeff Bezos and the super-wealthy who own 90% of all equities, is acceptable?  IOW an "impossibly" exploitive system  fits human nature to a Tee but cooperation, purposeful work and getting paid for contributing has no grounding in human nature?  This illustrates, at least to me, how distorted our culture and society have become: derealized, denormalization, decomplexification and decoherence. https://www.oftwominds.com/blogsept20/four-Ds9-20.html

    There are fairer, more efficient and less exploitive ways to organize human activity that are just as grounded in human nature as greed. We've allowed our conception of human nature to be stripped to greed alone, i.e. "shareholder value."

    8.  The status quo is in terminal collapse. Skeptics of this: please check back in 4 years.  All sorts of things currently believed to be "impossible" are not just possible, they're inevitable.

    9. The idea that only the most evil, corrupt systems endure is simply not grounded in history. Self-interest is a core motivator and systems that enable people to get ahead gain support. Those that don't decay and collapse. My idea is a self-organizing system designed to enable participants to get ahead will gain the support of participants. This is what "markets" and "free enterprise" were once about.

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  • Wed, Sep 23, 2020 - 3:09pm

    VTGothic

    VTGothic

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    Joined: Jan 05 2020

    Posts: 261

    3

    It's secure, easy,

    agitating, for what it's worth I also like Charles and have read him for a long time. However, I don't always agree.

    My "21 paragraphs" were not to explain bitcoin, but to build a case for my perspective that Charles is reinventing a wheel that is already well-built. And his new wheel won't do anything the existing wheel doesn't already do, arguably better. Good lord, you might as well say that when Chris publishes a long post on his choices of methods for gardening he's demonstrated that gardening is too complicated to get involved with - when what he's really done is introduce his gardening methods and made his case for the benefits of using them and having a garden in the first place.

    The notion that bitcoin is "perfect for corruption and illegal activities of all kinds" is a canard. It's simply not true. In fact, it's easier to trace transactions on the blockchain because they are permanent and immutable. (That's why Walmart is now using blockchain to track every head of lettuce it sells through its entire cycle, from seed to shopping cart.) It's much easier to engage in corruption and illegal activities with cash than with Bitcoin. Cash leaves no track.

    If you think it takes a "nerd" to navigate Bitcoin you haven't kept up to date. That was true 5 years ago, and my first few transactions involved a lot of fingernail biting on my part. But these days it's as easy as any other financial transaction you make on your smart phone or desktop. It's nearly exactly the same experience as opening an account at Fidelity and buying shares of stock. Heck, in some places you can even buy and sell cryptocurrencies at ATM-type machines in malls!

    As for blackouts. First, any ordinary run of the mill blackout is not going to affect any electronic records of any kind permanently. But if the US experienced a nationwide blackout your bank account and investment account might be endangered, unless your bank has backups offshore. Ditto, by the way, for your mortgage papers, credit cards and rating, even your medical records. Everything is electronic, now, not just cryptocurrencies. However, my cryptocurrency holdings are secured in a cloud "wallet" that's hosted on computers spread across the globe. The whole world has to go dark to mess up my records. And, I have my holdings duplicated on a "hard wallet," which is a hardened thumb drive. I can take that anywhere in the world, plug it into any computer, and access my account. I can also have a debit card that pulls from my crypto wallet to give me money in the currency of whatever country I'm in. And, if the internet goes down, I can call up my Bitcoin via satellite phone. My point: crypto is no more subject to blackouts than any other electronic account or record; in fact, less prone to being inaccessible or lost in such a case.

    Finally, you don't have to be your own banker to be in crypto. There are crypto exchanges that will store your dollars and crypto in an account, just like your local bank holds your dollars now. You can put some of it out to interest if you want, and make 4-1o% interest, depending on what crypto coin it is, with the most interest earned on US dollars. What regular bank pays 10% interest, or even 4%?

    And Kraken, a Fidelity-like exchange, just received its banking license this past week. Soon it will have physical branches in every state, and an online bank. They can hold your crypto and cash for you, just like your current bank, and can provide all the other services you're used to.

    Kraken is the first Special Purpose Depository Institution (SPDI) authorized under Wyoming law. What makes it special is that it operates by different rules than your current bank. When you deposit money into your current bank it is legally no longer your money, but an asset of the bank. (I bet you didn't know that.) As a result, they can do what they want with that money, and if they get in trouble you just might be left holding an empty bag.  But a SPDI like Kraken is required, by law, to treat your wealth as your wealth. It is never their asset, they only custody it for you, and provide you services. So if Kraken - or any of the other SPDIs coming online over the next few months - goes bankrupt, you will still get back all of your wealth they are securing for you. None of it can be used to satisfy their creditors - but your regular bank account can be garnished or seized to satisfy creditors of the bank. (That's a "bail in," as was done on Cypress in 2013. Bank accounts lost 47% of their deposits in that event.)

    So the point of this "21 paragraphs" is 4-fold: to show you how your information is out of date, to indicate how secure cryptocurrencies really are, to illustrate the current ease of getting into and out of crypto, and to point to the way crypto is going mainstream, quickly. It's here to stay.

    I do agree that a government is not likely to get behind Bitcoin. The only government that could get behind Bitcoin would have to stop deficit spending. Ha! That ain't happening soon.

    But that doesn't mean Bitcoin won't become a money in its own right; it already is becoming an international money. It's particularly appreciated in countries where inflation or outright government fraud guts the value of the local currency - like Venezuela - there the people want and need an alternative to government currency to protect their wealth, and Bitcoin is one alternative proving highly effective. If you think the US could ruin the dollar, having some Bitcoin as a hedge could be a good strategy.

     

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  • Wed, Sep 23, 2020 - 5:51pm

    Mohammed Mast

    Mohammed Mast

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    Joined: May 17 2017

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    0

    agitating again?

    lol

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  • Wed, Sep 23, 2020 - 6:11pm

    #27
    Redneck Engineer

    Redneck Engineer

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    BTC in World Lit Only By Fire

    Playing devil's advocate for a moment:

    If we do have a massive societal and technological collapse, I don't see how BTC or other crypto/digital currency would be sustainable. There's a lot of energy and money required to support the BTC infrastructure: massive electrical grid run on cheap fossil fuels; PC/semiconductor industry to build PCs, tablets, phones, routers, switches, and servers; fast internet; etc. Heck, if fossil fuel prices skyrocket, wouldn't that significantly raise the operational cost of mining coins?

    Compare that to silver or gold. The energy cost for 1 oz coins are completely done when the coin is finished minting and delivered.

    If fossil fuel costs skyrocket, the value of every existing gold and silver coin would go up tremendously because the marginal energy cost to make another coin would be tremendous. The cost to mine the next BTC would also go up, but the energy cost to transact in BTC would go up significantly, wouldn't it? It seems like the transactional cost for gold and silver would be much better in that case.

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  • Wed, Sep 23, 2020 - 6:54pm

    Mohammed Mast

    Mohammed Mast

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    1

    # 7

    I will make an assumption here that # 7 refers to my comment.

    I like your writing and have not read your book so my comment may have been somewhat unfair. The podcast was pretty weak on details. It was lacking focus. I have found that to be the case here many times not just with you. Chris as many other interviewers use the interview as a platform for his own "track". The best interviewers ask pertinent questions then get out of the way except for follow up questions.

    You make the assertion that "the status quo is in terminal collapse" That may or may not be true. Frankly I don't even know what that means. I have been reading here for around 13 years and the "terminal collapse" has been promoted ad infinitum. It aint happened yet. Will it happen (whatever it is) yeah, just like Rome it took 400 years.

    Like a broken clock that is right twice a day, eventually doomsday predictions will be right eventually.

    Can communities be organized better? Theoretically, yes.

    45 years ago we probably would have rolled a nice fat one and fantasized about such communities. (I was actually in one) The fact is this country is littered with the ruins of not only those attempts from the 60's and 70's but historically those ruins are all over the world.

    https://www.pcmag.com/news/11-failed-utopias-you-can-visit

    As for crypto, VT laid out the concept so no need to go there except in your comment you mention that electric consumption is an issue. This is a very nuanced issue which leads to all kinds of misinformation. I suggest you read into it further before jumping in on it. Much of the energy used to mine BTC comes from "clean energy" (that is another nuanced discussion for another day)

    https://www.vox.com/2019/6/18/18642645/bitcoin-energy-price-renewable-china

    https://www.coindesk.com/the-last-word-on-bitcoins-energy-consumption

    https://www.iea.org/commentaries/bitcoin-energy-use-mined-the-gap

    https://www.forbes.com/sites/christopherhelman/2020/02/28/why-is-this-peter-thiel-backed-startup-mining-bitcoin-in-west-texas/#37e8081f5174

    The key to any hope of alternative communities that might succeed , is getting out of the current monetary regime. As VT has explained that wheel has been invented and is rolling. What it needs is for uninformed critics to get informed and realize that it is "our" money. Then widespread adoption will happen and your vision of community will have a shot.

    So Charles while my comment may have seemed offhand I can assure you there is data and experience to back it up.

    I suggest in the future if you are going to promote your work, that you take care that it is presented better than it was in this podcast.

    Good luck

     

     

     

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  • Wed, Sep 23, 2020 - 8:43pm

    #29
    ao

    ao

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    5

    my simplistic view of Bitcoin

    If man can make it, man can break it.   Have you ever seen a lock that can't be defeated, a code that can't be broken, a ship that is unsinkable, a human system that can't be corrupted, a technology that can't be superseded, etc?  If history teaches us anything, it's that human hubris almost always goes down in flames.  Plus, complex things have more ways they can break and are more likely to break than simple things.  Forgive me for being an adherent of the KISS principle.

     

     

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  • Wed, Sep 23, 2020 - 10:31pm

    MKI

    MKI

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    Check back in 4 years...

    The status quo is in terminal collapse. Skeptics: please check back in 4 years.

    Heh. Couldn't we have said this 4 years ago, in 2016? What is so different now? Or even 4 years before that, in 2012? And don't even get me talking about 4 years before that, in 2008! I don't know if my lack of confidence makes me a "skeptic"...I think it just makes me "sane".

    Evidence for my position: If one was so sure they can confidently predict the time of "terminal collapse"...wouldn't they just short everything and retire in 4 years?

    But it was a good talk. I always enjoy CHS approach to living.

    And ao, we think alike on Bitcoin.

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  • Thu, Sep 24, 2020 - 4:46am

    #31

    sand_puppy

    Status: Platinum Member

    Joined: Apr 13 2011

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    36

    Expectation of Collapse and Personal Anxiety

    With the heart rending pain brought to me by recent life events, I have been forced to look at a number of my "narratives" (stories that I believe to be true) and question them.  Two stories figure prominently:

    1.  The imminence of a stock market correction.

    2.  The inevitability of social collapse and a future of a wild, dangerous, lawless world with inadequate access to food and water.  (This is a particularly scary story retold and embellished on prepper blogs and many collapse novels.)

    These stories, believed, created major rifts between me and family causing harm at several levels.  For me, they were driven by anxiety/insecurity, and fed that insecurity.

    I have been believing in stock market correction every year for 8-10 years and have kept money out of the "doomed markets."  Unfortunately, every year (so far) the stock market has risen causing me to miss out on the gains, and to be viewed as ungrounded in reality by my more traditionally minded family.

    And, my traditional family turned out to be right.   When the prediction of correction is wrong repeatedly, we need to conclude that there are other forces or processes at work that we have not understood or factored in.  This narrative did not prove to be accurate.

    ----

    The second story, the inevitable collapse of society and the dangerous world coming in the future, also has taken a great toll on my sense of well-being and ability to live in the moment in peace.  It fed my pre-existing insecurity and fearfulness, keeping them inflamed.    Relationships were damaged.  I have had difficulty being present and "just hanging out."

    ---

    In therapy with a couple of gifted psychologists, I've found a few things about myself.  The first is that I have a longstanding pervasive sense of insecurity, danger and anxiety.

    One of the defining symptoms of anxiety is a belief in a catastrophic future.

    Being intelligent, I use my intellect to try to protect myself from this vision of a frightening future.  I study, read. learn, strategize and buy survival supplies.  I develop a narrative.   The narrative tells me what I must do to protect myself.   All of this is in an attempt to control this pervasive longstanding sense of fear.

    Unfortunately, there are not enough survival supplies on earth to control this fearfulness and the core feeling state remains unimproved by these efforts.

    And, it puts me on another planet from my family and friends who do not share this narrative.

    ---

    Changing strategies

    A couple of spiritual practices look at questioning our narratives--the stories that we hold in our mind that we believe to be true.  The goal is NOT to debate whether the narrative is true or to gather more "facts," but to loosen the grip the narrative has on us.   To be less certain, less emotionally captured.

    Several approaches seem to be helping me in this.

    The first is to simply see the insecure/fearful feelings as feelings without running a cognitive operation to "manage" them.    Awareness envelops and sees the feelings, holding them, and they are reduced in power.   Sometimes by being held, they actually melt, but not always.  Melting is wonderful, but the goal is to be present with what is.  And often it is insecurity.

    Byron Katie recommends questioning our believed stories.  "Is this true?"  "Am I absolutely sure it is true?"  "When I believe this story, what effect does it have on me?"  Of becoming less certain of their rightness.

    Adyashanti is another spiritual teacher pointing to the background field of presence/awareness as our true identity, and the many narratives that we hold and believe, as the illusion that keeps us from living in this deeper level.

    “Many people think that it is the function of a spiritual teaching to provide answers to life’s biggest questions, but actually the opposite is true. The primary task of any good spiritual teaching is not to answer your questions, but to question your answers. For it is your conscious and unconscious assumptions and beliefs that distort your perception..."

    Another one (paraphrasing as I can't find the quote):

    "If you want to learn what is true, go elsewhere.  But if you would like to un-learn all that you believe to be true, then sit and we will begin."

    "....In the end, just emptiness remains."

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  • Thu, Sep 24, 2020 - 5:12am

    Oliveoilguy

    Status: Gold Member

    Joined: Jun 29 2012

    Posts: 826

    18

    Feeling Alone

    Sand_Puppy....I cannot agree more. I’ve also held outlying views and proven myself wrong over time. It’s hard to live on the edge, and not have support in your immediate circle of friends and family.  I appreciate all you do for this community. We are definitely an “edge” community and a certain degree of discomfort is par for the course.

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  • Thu, Sep 24, 2020 - 7:07am

    #33
    Hans

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    Joined: Aug 09 2017

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    3

    debt and trust

    What I miss in this discussion (both in the conversation between Chris and Charles and the following comments on it) is where debt comes in. The only thing that was discussed was the person who took care of the livestock of Chris. What was not mentioned was that Chris was in debt with this person!

    People trade goods and services. The simple way is direct barter. A little more complex is indirect barter where people who know eachother and trust eachother, exchange gifts and help eachother without any pay. We trust that some day we will level the score when I am in need.
    If this trust is less, we will write it down somewhere. If the trust is lesser than that, the one who provided the goods or services would want something in return to represent the trust. Money is just a way to postpone the second part of the barter / trade. The less trust, the more need for a substitute for that trust.

    That is why money ALWAYS is debt and ALWAYS represents trust, in any form. Euro, dollar, gold, seashells, bitcoin, whatever.

    Where things go wrong now is that some parties are allowed to create (an infinite amount of) debt without ever deliver the second part of the barter.
    They can do that by the institutions we have created like banks, gouvernments and central banks. But also because of the entities we call "corporations", where the debts are for the personless corporations and the benefits are for the persons who run it. Make people personally responsible again for the debts they created and you will see a change already.
    They act like a dirty profiteer that is never willing to help but always relies on somebody else. These profiteers will be one day spit out by the society they live in.

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  • Thu, Sep 24, 2020 - 7:13am

    VTGothic

    VTGothic

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    Because digital money is coming, soon...

    AO, Redneck: Bottom line and worst case, I agree with you - if we end up living in a Redneck's "world lit only by fire," cryptocurrencies are not gonna be of much help. So I don't only invest in cryto. My main investment is in infrastructure and hand tools, and in learning how to do all that needs doing to keep this "ark" afloat by hand; and in the personal health and fitness I need to do all of that work, even as I age. Then I have pm, too.

    I categorize build-out in terms of "100 year solutions" and "30 year solutions." The 100-year are those that can sustain life in the total collapse scenario. The 30-year are preparations and tools that can be layered on top of the baseline and used for as long as they can be kept operational or replaced. They make life and work easier. Digital money is 30-year. So is the US dollar.

    There is, of course, a lot of space between today's "life uninterrupted" and some potential "lit only by fire." I doubt the future is at either end, but I can survive at both ends. Rather, I expect we'll devolve to some intermediate state, reorganize, and re-emerge at a lower level of consumption, perhaps also of tech (though not vastly lower), re-adapted to whatever changes in environment are coming, quite possibly with an interim pruning of our human population, and get back to relatively stable and humane life. I'm just trying to equip so my descendants can survive the "100 years" in-between now and then.

    Without doubt precious metals have a role to play as stores of value and as recognized trade coin. I also think Charles' scenario of linked intentional communities engaging in voluntary trade of goods could emerge, along with a slew of independent local producers and consumers who would want to network too.

    For me what's been at issue in this particular conversation has been whether Charles is proposing a truly new kind of electronic coin for the arising digital-money age - an age which is most assuredly coming, whether any of us like the idea or not. (There's already talk of providing digitized wallets for every American next year to facilitate helicoptering digital stimulus or base income into bank accounts.) Based on this interview, I think he's not. I think he's only changing the basis value proposition.

    Charles thinks that putting demonstrable labor at the root of generating new coinage puts human and humane considerations at the heart of his proposed new economic model. I think his apparent proposed structure is fraught with potential for abuse. And I think those same values can be at the heart of existing protocols. In all cases - his proposed new coin or my hypothetical Ethereum-based contract system, or even Bitcoin - what finally keeps the economy human and humane is going to be what lurks in the hearts of wo/men. We are remarkably good at corrupting everything.

    Whether its Charles' proposed labor-linked coin or something already extant - of which Bitcoin is simply the 800-lb gorilla in the crypto room - I share with Charles the conviction that it's a darned good opportunity, right now, and an equally good idea, to work at establishing one or more alternatives to State-controlled digital money. I'm also not keen on such alternatives being corporate-run or organized and managed by some self-appointed cabal, however "good" they promise to be - that all leads to the same kind of censorship we're seeing emerge on the dominant social media and search engine sites.

    One of my criticism's of Charles' proposal is that it is not a leaderless system. He assumes some kind of authority, and hopes to make it democratic, and responsive to those who use it. For me, that's trusting too much to human nature, which proves over and over again that when it comes to self-interested action, very nearly every one of us turns out to have a weakness.

    That's why, given the options available, I vote for the one coin that can't be owned by any individual, cabal, corporation, special interest, or government. For a non-captured option, Bitcoin is not only the clear leader on the leader board, it's the only choice. Other coins can (and will) be used as overlays,  but Bitcoin can and should be (and will be) the base layer, the "digital gold" that every other digital coin pegs to; that is Bitcoin's nature as designed, its virtue.

    That's really all my part in this discussion has been concerned about: Since we have to choose, because digitized money is coming, choose the most inherently robust and freedom-preserving coin. Don't think you can avoid choosing - for some power will then choose for you - and don't propose or adopt a new coin that imitates in slightly different form the weaknesses of all of the existing alternate digital coins, each of which are valuable in their own way, but all of which are inferior alternatives to the freedom-preserving strengths and market robustness of Bitcoin.

    My opinion, of course.

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  • Thu, Sep 24, 2020 - 7:14am

    Fredrik Lidman

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    Fredrik Lidman said:

    Sand puppy,

    It takes lots of courage to face what you just describe. Respect.

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  • Thu, Sep 24, 2020 - 9:21am

    RandomMike

    RandomMike

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    Phil Williams

    Look at the Phil Williams website, he has a possibly free book written for you, Against the Grain.

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  • Thu, Sep 24, 2020 - 9:22am

    Redneck Engineer

    Redneck Engineer

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    Posts: 110

    1

    Redneck Engineer said:

    VT-

    It makes sense to wargame the various scenarios, assign estimates of likeliness, and assess various approaches' impact in each case. Then allocate investments accordingly. That should provide a good overall investment against the most likely outcomes, as well as being prepared in case the most anticipated outcome turns out to not develop, or develops after a very lengthy delay. And the time scale also needs to be hedged.

    BTC, cash, gold have different pros and cons which will need to be assessed in each scenario.

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  • Thu, Sep 24, 2020 - 9:55am

    #38
    westcoastjan

    westcoastjan

    Status: Silver Member

    Joined: Jun 04 2012

    Posts: 461

    6

    Gail Tverberg new article, with valid observations

    Reaching the End of Early Stimulus – What’s Ahead?

    I agree with those commentators who are bitcoin skeptics primarily because of that, and any other crypto reliance on electricity to be of use. As Gail notes below, and Dimitri Orlov has also commented in his books, that as things decline ongoing maintenance of the electrical grid will become problematic. There is no question in my mind that periodic power outages will increasingly become the norm. Given that, I have no use for a monetary asset that cannot be accessed or used in such circumstances.

    "... If the many strange approaches I outlined in Section A are used to add even more debt to keep the system afloat, eventually some part of the system is going to “break.” For example, banks will stop issuing letters of credit with respect to purchases made by buyers that don’t seem sufficiently creditworthy. Banks may stop trusting other banks, especially if the banks do not really seem to be solvent. At some point, the international financial system seems likely to start “coming apart.” Eventually, the US dollar will stop being the world’s reserve currency.

    My guess is that a new two currency system will develop. Governments will issue a lot of currency for local use. It will not be useful for buying goods from other countries. Much of it will be used for buying locally produced food and other locally produced goods.

    Very little international trade will be done. Any international trade that will be done will occur between trusted partners, at agreed upon exchange rates. Perhaps a special currency will be used for this purpose.

    In this new world, individual countries will be very much on their own. With very little fossil fuel, countries will tend to lose electricity availability very quickly. Transmission lines will go unrepaired. It will become impossible to fix existing wind turbines. Road repair will become impossible. Electric cars will likely be as unusable as gasoline powered ones."...

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  • Thu, Sep 24, 2020 - 9:56am

    #39
    Mohammed Mast

    Mohammed Mast

    Status: Silver Member

    Joined: May 17 2017

    Posts: 778

    9

    The Gold Bugs Dilemma

    sand puppy eloquently and poignantly illuminated some of the greatest failings of the "doomer philosophy".

    There are 2 and only 2 motivating factors: Fear and Love. It takes a great deal of inner work to discover our own motivation. Most are not capable of such work. I applaud SP for doing the heavy lifting.

    Personally I have been reading this site for around 13 years. Much of that time I have absented myself. Frankly it just got too fucking depressing. It is a giant negative feedback loop. The paradigm expressed here is one of millions of possibilities. Blind adherence to that paradigm (being a member of the "tribe") comes at a cost, as SP has stated. One can take a post from however far back you wish to go, about the Fed (which appear with regularity) and insert it today almost seamlessly.

    The group consciousness revolves around the premise that the next 20 years are going to be different than the last 20. Well that is true for every 20 year period. The actions one takes are based on that premise. The underlying assumption is that "things " will get worse so hunker down, protect wealth, get guns, buy gold, (will get to the dilemma in a moment) stock a pantry and grow a garden. Some of these are good and prudent things to do anytime. The question is what is the motivator? Is it fear or love? As SP stated he missed out on the largest bull run in history because of fear. You can control people very easily through fear.

    The central theme here is the three E's. For quite a while the focus has been on only 2 of them. The environment has gotten short shrift except for the climate. Most here are PM acolytes. Most here are opposed to crypto currency. Some of the reasons include the large amount of electricity required to mine it. I posted above how the majority of the electricity comes from renewable sources. While the gold bugs will harp on that they will completely ignore the environmental damage caused by gold mining. If anyone ever gets to Telluride you will see that a large portion (maybe half) of that valley is composed of mine tailings. Water is polluted, land is polluted and air is polluted by mining. Yet that fact goes by ignored here.

    What SP has brought to the discussion is the fact that there is a spiritual component to life. That spiritual component is largely absent here. It just may be that spirituality might be a more valuable item to deal with the next 20 years than gold or guns. As an example there is emphasis here that guns are necessary to "defend" our homestead. A completely different paradigm that comes from a spiritual place is if someone comes to rob your garden it is because they are hungry you bring them in and feed them. The Buddha stated quite clearly that life is suffering and there is a way out of suffering. It did not include guns and gold.

    If you have a paradigm which is bringing you happiness and fulfillment then keep going. If on the other hand if like SP the cost of adhering to that paradigm is making you unhappy then change the paradigm. Tell yourself a different story. Choose love.

    I have four rules

    1- Show up

    2- Pay attention

    3- Do the best you can

    4- Leave the results to god

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  • Thu, Sep 24, 2020 - 10:52am

    #40
    tbp

    tbp

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    The holocratic emergence

    @VTGothic
    Furthermore, because of how Bitcoin is designed, it has all the privacy (another key feature Charles wants) of a current fiat cash transaction.

    Not exactly. Bitcoin isn't really private/untraceable like cash unless you use it very carefully (e.g. not reusing addresses, choosing your UTXO inputs, not linking any address to other PII), because of how transparent it is. There are already blockchain analysis firms that have turned BTC and most other coins into surveillancecoins, in contrast to privacycoins, such as Monero and Zcash.

    Bitcoin, by contrast, does not need to rely on hopium, nor to believe in the (demonstrably non-existent) natural goodness of the human soul.

    That's a step too far, you can't demonstrate that... 😉

    @sand_puppy
    My experience with communities have all centered around a charismatic leader. The leader held the vision, decided things, and was the interpersonal glue that held things together.

    But personality conflicts eventually arose. The leader-follower glue (mostly admiration for the leader) came loose and the communities splintered.

    The problem is worse if the leader is smart, well liked, and has a charismatic personality.

    This has also been happening for a long time in spiritual communities; we've been subscribing to the teacher/master--disciple model/relationship, which is coming to an end as well. As I and a number of other researchers have been suspecting for a while, 'The Event' is about the collapse of hierarchy and the control structures, i.e. a complete loss of trust in the institutions, weaponized to enslave us in ever more blatant ways, in favor of bottom-up horizontal holocratic organizational structures.

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  • Thu, Sep 24, 2020 - 11:01am

    Redneck Engineer

    Redneck Engineer

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    Redneck Engineer said:

    I don't think humans can operate without narratives, or some sort of overarching view of the world and their place in it. They issue is how to deal with conflicts between the narrative and facts. Confirmation bias pops up as one solution: cling to the narrative, filter out facts that don't conform.

    Another approach is to hedge as insurance. Make your best guess of the future, but put a little money in place in case that doesn't happen, or happens far in the future.

    For example, suppose you project massive inflation is coming because we're on a fiat currency, and all fait currencies eventually collapse. That was as true in 1971 as it is today. If you bought gold in 71, you did well over the next decade, but lost a lot over the two subsequent decades. So having some money in other things - say, cash-generating investments - would offset the effective holding cost to sitting in gold while waiting for the sky to fall.

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  • Thu, Sep 24, 2020 - 11:09am

    thatchmo

    Status: Silver Member

    Joined: Dec 13 2008

    Posts: 238

    5

    thatchmo said:

    MM and sand_puppy:  Thank you both for your latest posts.  I believe they contain crucial considerations.

    "It's hard to make predictions, especially about the future." - Yogi Berra

    Aloha, Steve

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  • Thu, Sep 24, 2020 - 2:44pm

    Mots

    Mots

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    Joined: Jun 18 2012

    Posts: 266

    3

    debt and the real bills doctrine

    Hans, thank you for your comments about flaws in our currency thinking.

    The real bills doctrine was brought up as a solution in this context to avoid these issues, almost 100 years ago but no one is talking about it now.  Basically, the people at the bottom who create wealth should be the only ones who can issue new money, based on their promised wealth products.   The amount of money then corresponds with real wealth creation.  We should redirect our precious time attention away from the free-shit wheel spinning dreams of financial planners and bitcoin gamers and focus on the details of real wealth creation.

    A big contribution of CHS's tome is to point out the need for a system that rewards real value.  Why cant the Real Bills Doctrine play a role in such system.  I am a farmer (or shoe maker) who needs investment in the Spring (or to buy materials) so I write my own promissory scrip (money) that people will value because they want my future produced food or shoes after which my script is redeemed, the debt self extinguishes.  If I do not create the food or the shoes (maybe I spend my time gaming the currency) then my scrip becomes worthless and is thrown away. A corollary to that is, we need a better environment , a better future so let's measure the parameters of "better environment" and link measurements of such with actions that can be taken.  I saw a 100 year old type of stone scrip on the side of a 100 year old paved lane going over a mountain in the north side of my island.  Listing the contributions of long-dead neighbors who did something to improve their neigborhood, and who only received recognition for their efforts.  Mr. Yamada contributed 10 yen.  100 years later I come by and respect Yamada's help to my foot travel (this is an example of a system that encourages real wealth creation)
    We should be using our valuable brain power and short attention spans to evaluate and encourage each other's contribution to the glorious world of wealth production and a better life.  Bit coin gaming, and Tesla stock gaming and (fill in the blank) gaming is not helpful.   OK, so bitcoin has some new features that can be used to bypass the banks.  I get it.  I got it years ago actually.
    CM's discussions of land banking (creation of wealth in the soil), saving rain water etc. are more important than the buy low sell high gaming schemes that everyone seems to be focusing on.  How to redirect efforts towards respecting and promoting real value was a major point in CHS's book.  No one is talking about this more important point.

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  • Thu, Sep 24, 2020 - 5:23pm

    paranoid

    paranoid

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    4

    paranoid said:

    Sand Puppy and Mohammad Mast thank you. Very insightful. Would love for Chris et al to bring these aspects (spirituality and keeping balanced as we work our Plan 'B') into his work more.

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  • Thu, Sep 24, 2020 - 9:24pm

    SagerXX

    Status: Gold Member

    Joined: Feb 11 2009

    Posts: 462

    11

    Sand Puppy, Olive Guy

    Yes, when your core self is unable to remain in denial of what's coming (it's just a matter of when and to what degree), there is a price to be paid.  Scouts who by definition must range out to the edge of the "safe" and "civilized" areas in order to gather information about what is coming (ostensibly to advise and protect/aid their community/tribe) -- well, the scouts live rough and are by definition at least somewhat marginalized.  We are also indispensable.

    Follow the path.  If you're here on PP, it's probably yours to walk.  Keep looking out there at the edge and keep on gathering information and making what preparations one can.  But -- it is also of immense importance to find joy in the day-to-day, pleasure in the small things, and comfort with our family/tribe (or as we say in Hawai'i:  ohana)...

    I try to do something I enjoy with people I care about every day.  No matter how seemingly trivial or brief the moment, it is grounding and heart-opening and it humanizes me to anybody who might (if they happen to understand my core belief system) wonder if I'm a kook.  No, I'm not a kook.  I'm a scout.  And there are elements of my essential psychological/spiritual makeup that explain why I'm out at the edge, watching.  Just as there are elements of other people's makeup that keep them at the center (and perhaps resistant to the idea that change is coming, if not imminent).

    No judgment -- tribes need both of these types (and many other types, too).

    This daily practice -- do things you enjoy with people you care about -- is part of my spiritual path.  I tend to get "out there" if I don't ground myself in the quotidian.  And when I describe something as common or ordinary, I am not denigrating it;  most of our lives are made up of the quotidian, and much of it is lovely -- especially if one takes care to arrange one's daily just so.  For the record, with my beloved practice of Tai Ji and Qi Gong, I'd describe myself as raised charismatic Christian but these days unchurched and Tao-ish.  I am a part of all what is and part of an unfolding process which it is my pleasure and intent to harmonize with -- I don't get to choose what wave arises, but I choose to surf it with panache.

    Eat clean food, drink lots of water, prioritize sleep, move your body several times a day every day, keep learning, love often, have compassion for the struggling people you encounter, and do things you enjoy with people you care about.  And:  inquire as to the nature of things, including yourself and the divine (unless you're an agnostic or atheist, in which case continually inquire as to by what immensely magnificent process all this show arose)....

    The next ten years (or more?) are going to be a time of immense and sometimes desperate struggle.  They will also be full of invitations to create, and participate in, marvelous and long-overdue change.  And we scouts?  We'll scope the way forward...

    One man's opinion....

    VIVA -- Sager

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  • Fri, Sep 25, 2020 - 4:12am

    #46
    planfortomorrow

    planfortomorrow

    Status: Member

    Joined: Dec 28 2017

    Posts: 155

    2

    planfortomorrow said:

    Back during the Carter Adm. high inflation I was approached and signed up to be a part of a scheme where you earned credits and could use these credits to purchase many items used in every day life.

    What happened and I am really challenging myself to remember as time has moved along is that I would paint a clients home and be credited with X amount of credits. Then I could take these credits and purchase a lawn mower and any other items from vendors on the list provided by those who set this scheme up.. This went on for a while until I would do other clients homes, the plan to get a van from one of the vendors on the list was my goal. Then Volker came along.

    What Volker did was he lowered the inflation rate with a gutsy policy to reduce the very high inflation and get back to a reasonable inflation. With that went the interest in this social plan that I was involved in. I had many credits with no vendors honoring the credits I had saved up so eventually, actually overnight, the whole system failed.

    As is always the case, when confidence in the system fails than quite quickly it goes to zero as bad news has a way of doing this. It seems everyone gets the memo at the very same time. I rationalized the whole experience this way: I basically got off cheap and learned a very important lesson. My lesson was and has been cash on the barrel head or a barter that is made in real time where I get what I want and the person I'm working with gets what they want immediately. Good-Good!

    I DO NOT believe any system will truly work as the current system works. We better be very careful what we ask for and we have a system that will take a long time to truly destroy. It's unthinkable for me to think I won't use dollars and coinage to due my purchases. Inclusive of course is credit cards and long term loans. We are all so familiar with our system that to be asked to change this dramatically will take a very long time to have a positive reaction by the masses to accept. We can tweak this system but to reinvent the system will be a change that will cause a mental breakdown among the masses and is what I fear would take a very long time to make common and acceptable to all. The system we have now while far from perfect should be made better and should get the time necessary to make good again.

    The Rich do not understand that what they have are ill gotten gains and if they want to hold onto what they have they should jump first into the arena and essentially give it all back. It's going to happen anyways so why risk their lynching on their front lawn oak tree in favor of getting ahead of this and help be a part of the solution rather than part of the problem. If they gave half their wealth they would still be wealthy beyond anything reasonable. Even by taking half their wealth we as a country would not benefit all that much as it wouldn't come close to paying down our national debt. What it would do however is send a strong message that they understand, and that country comes first and it would be a great leadership example to everyone that we are in this together. Greed don't work this way however and so I fear the worst for others. Me, I'm resilient. I control my destiny and will live the life I wish to live. In doing this my plans are to be there for those that help me directly and without having to spend or make any cash. I earn the respect of my small community and we will ban together to make this little part of the world one that we want to protect and do whatever is necessary to maintain it. We really only need food, water, clothing a roof over our head and heat/energy to truly be wealthy after all. Do this and collectively we have the energy to do other things with the resources we all have that can be used to have major impacts in all our lives. My neighbors and I have many millions of board feet of lumber and a well stocked food source that live in this environment so we should or rather could be just fine in any environment.

    Charles is really putting himself out there. He has started a conversation that I have enjoyed reading as he always does for me. It's tough being the first but he does it with such class and confidence. He is willing to change his mind if given a better way to do things as Chris has done, you have done and I have done.

    We have some gifted Folks on this site that have credibility and for me that's inclusive of everyone who takes the time to offer their comments here.

    Great conversation. Peace BOB

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  • Fri, Sep 25, 2020 - 4:45am

    #47
    ao

    ao

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    Joined: Feb 04 2009

    Posts: 1329

    12

    Sandpuppy, thank you for everything you have done here

    First let me say I admire your honesty, your transparency, and your willingness to place yourself in a position of vulnerability.  That all takes courage and speaks well of your character.  I for one (and I'm sure others) have watched while you've learned and grown and then shared that learning with others, helping them to see the truth as well.  While learning what you have learned can be somewhat traumatizing to the psyche (I know it was for me), what can be greater than this search for the truth, regardless of the pain and suffering involved, and passing on what you have learned to others.  That, to me, is a noble endeavor, worthy of what you have endured.
    Furthermore, in so far as being right or wrong, it's very much a matter of perspective with regards to investing one's money.  Let's take a snapshot in time from January 1st, 2000 until yesterday or a period of roughly 20 years.  From that day to yesterday, September 24, 2020, the Dow Jones Industrial Average increased from 10,729 to 26,815, an increase of 2.50X.  The S&P 500 increased from 1,426 to 3,247, an increase of 2.28X.  The Nasdaq increased from 4,186 to 10,672, an increase of 2.55X.  Yet in the same time frame, gold increased from 282 to 1,964, an increase of 6.96X while silver increased from 5.3 to 22.2, an increase of 4.2X.
    So gold, admittedly a crappy investment (but not a crappy insurance policy) because of no capital growth, no dividends, and no interest, handily outperformed each major stock index in that time frame, more than doubling in comparison.  So were you right or were your family members right?;-)
    In so far as spiritual teachers, I recall one who said:
    "I have told you these things, so that in me you may have peace.  In this world you will have trouble.  But take heart!  I have overcome the world."
    He also said (foretelling what was to come in this time of strife):
    "They will be divided, father against son and son against father, mother against daughter and daughter against mother, mother-in-law against daughter-in-law and daughter-in-law against mother-in-law."
    And he said:
    “Come to me, all you who are weary and burdened, and I will give you rest.  Take my yoke upon you and learn from me, for I am gentle and humble in heart, and you will find rest for your souls.  For my yoke is easy and my burden is light.”
    I've studied many great spiritual teachers and I've never found words more powerful or truthful than his.   For me, when you know where you've come from, who you are, and where you are going, there is a peace that comes upon you that this world cannot shake.
    I think you are very wise and humble to seek out the help you did.  And I hope that you will continue to learn and grow in that realm of understanding as you have in others.

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  • Fri, Sep 25, 2020 - 7:16am

    000

    Status: Bronze Member

    Joined: Dec 10 2013

    Posts: 201

    1

    Behind Every Train There Is Another Train

    Behind Every Train There Is Another Train, Be careful walking down the tracks.

    This is a saying in India I was told. It's not about trains. It's about what I believe and become overly identified with and possessive of and therefore defensive of. This includes spiritual materialism.

    Grief is one of the great teachers in all it's stages because one has no choice but to "let go" or remain in pain. Suffering is another matter but an equally powerful master.

    Confusion, ahh, confusion, is what enlightenment feels like. If you're not confused you can't really be all that conscious of reality because life is confusing.

    Recently I've absorbed Prof. McPherson's paradigm where our future is baked in. Quite literally Baked In. There is nothing large mammals can do now except live well.

    I resisted this idea and for some time found I was going through stage of grief ie denial, anger, ... acceptance. Acceptance is a peaceful form of confusion. Let it go. Live well as I can.

    However, I'll not be shoveling cow poop any time soon as I'm quite busy with my own. But, I can't wait for the opportunity to watch others shoveling at the PP Farm School when it opens for visitors!

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  • Fri, Sep 25, 2020 - 7:49am

    #49

    JAG

    Status: Platinum Member

    Joined: Oct 26 2008

    Posts: 528

    4

    Thoughts

    SP: The first is to simply see the insecure/fearful feelings as feelings without running a cognitive operation to "manage" them.    Awareness envelops and sees the feelings, holding them, and they are reduced in power.   Sometimes by being held, they actually melt, but not always.  Melting is wonderful, but the goal is to be present with what is.  And often it is insecurity.

    This is the key to life I believe, at least my life. I've always had the propensity to assign way too much value to my thoughts. Once you identify with a thought, it skews your perception of the next thought, and you end up riding a chain of thoughts to no place worth going.

    For me, 'ignoring' my thoughts, for lack of a better term, is the hardest thing to do. It requires significant and consistent focus on the kinesthetic input from my body to be able to disengage from the thought process, if only for a brief moment. This focus on kinesthetic input from the nervous system is what I believe they mean by 'being present'.

    If you are thinking the thoughts, who is watching the thoughts?

     

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  • Fri, Sep 25, 2020 - 8:22am

    #50
    wotthecurtains

    wotthecurtains

    Status: Bronze Member

    Joined: Feb 27 2020

    Posts: 99

    11

    Expectation of Collapse and Personal Anxiety - sand_puppy

    sand_puppy, you may be one of the best doctors out there.

     

    I too have struggled with the attendant stress of applying a highly detailed mechanistic model to a world that refuses to follow it.     For me it started probably 25 years ago when Atlas Shrugged scared the shit out of me.   "That was the book that scared me into taking my life seriously" I would tell people (and still do).

    But we tend to get our truth from people and things that are already on our wavelength, especially when we are young.   As a system builder type, I was super attracted to the idea of the economy as a machine and of philosophy as being an "eco-system of ideas".   You could take an idea or a fact and "run the tape forward" to see where it necessarily had to lead.

    Applying this mental process to politics, economics and my personal life came to make me very angry and sad.  It got to the point where I would announce to my friends that "to be a politician one must first be a coward".  It got to the point where I would see a beautiful young woman in a summer dress and end up thinking about rotting fruit.

    For me the break out of this rut started from a personal crisis.  One day, after about two months of seeing things that were impossible according to my narrative happening on a daily basis, I saw "the final thing" and I heard what sounded like a windshield snapping inside my head and I knew my model was utterly broken.   It was pretty wild.  I was never the suicidal type but I knew that my recent feelings of my life being “over” had finally come to pass.

    After that I was “free” and ended up taking the sort of actions that I could take now that I was no longer constrained by a narrative that didn’t work anyway.  And these actions, being informed by the principle of “whats the worst that could happen?”, ended up turning my entire life around.

    I am glad to see that you have found some resources that helped in making progress on your journey and its interesting that yours are very different from mine when our problem (being limited by narrative) seems to be similar.

    FWIW, I found a lot of help in Nassim Taleb’s work and the work of the behavioral psychologist types because they helped me to understand that the human minds ability to apprehend reality is not really “limited” so much as it is “laughable”.   I think for smart guys this is really hard to understand because you get so used to being able to see 10 miles further than those around you.  You start to confuse that for “knowing whats going on in the world” (at least I did).   But unfortunately none of us know whats going on or can.

    In that way, Im starting to get interested in more spiritual learnings.   Not because “finding Jesus” in a very literal way is gonna help me (its just another narrative after all) but because I want find ways to experience life as a small being in an infinite universe as is my nature.   If I can only be aware of, say 1% of all that happens, then happiness is in choosing what I focus on and not being judgmental of people for finding their own things to focus on.

    And once I let myself off the hook for knowing everything and for saving western culture (which doesn’t want to be saved and which is really just a story we backfit onto actions we took in the past because they seemed like a good idea at the time), I didn’t have to be so angry about everything falling apart now.

    I think there are some very basic truths (like that we are here to take care of each other) that are non-negotiable.  I’m still annoyed by people who are full of certainty.  I still believe in the arc of history and what we can learn from it.  I still think we can see in broad terms where things are going over the long term, but any attempt to use that to time markets or elect the right president or argue someone into loving us is a fools errand.   I still think that if we garden or stock up on HCQ we can make ourselves feel like we have at least some control over things.

     

    But the freedom of not having control over other things is exhilarating too.   I hope you get to enjoy the experience and that you keep sharing your thoughts here.  I’d like to have an excuse to share mine 😊

     

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  • Sat, Sep 26, 2020 - 6:29am

    Hans

    Hans

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    Joined: Aug 09 2017

    Posts: 29

    3

    Hans said:

    Hello Mots,
    First of all, sorry for writing such a long response to your comment. I hope you are so kind to take the time to read it :-).

    Thanks for your comment! I haven't read CHS's book (yet). Maybe I should; it sounds interesting. What you write about valueing real wealth creation is true. We should focus on that way more than the easy-free-currency-games that the world is in now. People in the Netherlands and Belgium even consider their home to be a financial asset. Is that also the case in the US? This should change. So far we absolutely agree. I also agree that we should be open minded and think out of the box now and then. What we are discussing now, is absolutely out of the box :-).

    But... :-).
    I like Mike Maloneys distinction between money and currency. I believe that the invention of the concept of money is one of the greatest achievements of mankind. I also believe that I (me personally) am not capable of rethinking the concept of money. It is true that creating wealth should get more focus instead of creating and gathering more CURRENCY. But in my opinion it is not true that creating wealth is more important than gathering more MONEY. It is equally important. Money is a store of value. Creating value is converting A into B, with the use of energy. My personal energy is labor. So money stores my labor for later use and benefit. I am currently able to provide the energy to store a surplus of it for the times when I am not able to provide that energy anymore. I think there is nothing wrong with saving. I even think there is nothing wrong with investing and lending, and being compensated for that in the form of interests and profit. So, is that easy-free-money? Personally I think it is not.

    The amount of currency that flows through the financial world is in no way reflecting the real economy anymore. Who can grasp the idea of a trillion? Who can imagine the wealth of bilionaires while I look inside my wallet and see a 50 euro note. Who can imagine being able to buy a house that is "worth" 10 annual incomes? It is depressing to live a world where people who do the least important work get the highest pays. I am not only talking about bankers and other thieves. Also people in sports, music, film, television entertainment get payed WAY, WAY too much for what it's worth. That is what Covid showed to the world: essential workers were allowed to go to work during the lockdown. Is it a coinsidence that these essential workers get payed the least? This level of wealth difference is injust. There is too much money-for-nothing. I totally agree with you that we need a bottom up approach, instead of a top down. That means that these essential workers should actually be valued as such. This means that someone like Warren Buffett would get foodstamps! Because what he does is of no importance at all. So it counts for all hedgefund managers, rappers, moviestars, etcetera.

    We should first of all get rid of fiat currency. Actually we should get rid of currencies at all.
    You write: "Basically, the people at the bottom who create wealth should be the only ones who can issue new money, based on their promised wealth products".
    I think a feature of money should be that nobody is able to issue any of it. The amount is fixed. Therefor it is a real store of value.

    I think gold and silver are the best suited for being money. Technology can help us to transfer gold and silver in an easy way, even if it is in nanograms. Transfering a claim on gold and silver should be considered as counterfeiting and should be punished by the highest penalty. If you lend gold, the gold is no longer yours. There is no difference between paying with the digital gold or the physical gold. The rate is 1 on 1. No gold-standard; Gold.

    The example you gave about the stone chip is a nice one. It requires a sence of community. A sence of belonging. A sence of being a custodian of the world we leave behind. Being and feeling responsible. It removes the "One Step Away" that CM described. You cannot hide behind a rule or a law or a company. You, personally are responsibe for what you do and that can be good or bad. You can contribute by giving your labor right now, or by giving the labor you did in the past, by giving money.

    In essence: we agree. But there is no sence in creating a new monatary system, without also working on the sence of community. When we would have a proper sence of community, there is no need in creating a new monetary system.

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  • Sat, Sep 26, 2020 - 8:50am

    #52
    ridgecrest

    ridgecrest

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    Joined: Dec 05 2019

    Posts: 2

    5

    ridgecrest said:

    Reading all the comments and it seems to me everybody thinks FED and currency is the problem. I don't think the problem is technical on how to create a fair currency. I think the problem that we need to solve is can we create a system that will prevent financing wars, talking about real wars meaning bombing other countries. Looking at how we end up here, it's all because of wars not because of bad currency. So I think your energy is spent on the wrong cause.

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  • Sat, Sep 26, 2020 - 12:31pm

    #53
    EddieLarry

    EddieLarry

    Status: Member

    Joined: Jul 04 2020

    Posts: 37

    3

    Too much stuff!

    Everyone I know has too much stuff.  The kids have said they don’t want it because they, already, have too much stuff.  How can we base an economy on a small group of people who have too much stuff?  Or how about old retired people?  Or a community of billionaires, Gates and Bezos and Buffet, what would they be doing?

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  • Sat, Sep 26, 2020 - 1:45pm

    #54
    DennisC

    DennisC

    Status: Bronze Member

    Joined: Mar 19 2011

    Posts: 182

    2

    Nobody Wants Your Stuff

    Nobody wants your stuff.  Nobody wants your parents' stuff (unless you're a fortunate beneficiary or trust fund baby).  Having been through a couple estate liquidations, many things assigned to an auction service or placed in a consignment shop eventually go unsold and ultimately donated (to some organization that might end up putting them in the "recycle" bin or dumpster anyway).  Generally, from my experience at least, people don't want (most of) your crap.  I try to go on regular missions around the house to get rid of stuff, even if it's just a couple items.  It's very uplifting, IMO.  Think of it this way, if you die and someone has to go through all your crap, do you want them asking "why did this old coot have so many old twist-ties and rubber bands in his silverware drawer?"  Never know when you might need one I guess (shoe fits, blah, blah, blah).  Anyway, this may interest some: The Japanese Art of Decluttering and Organizing.

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  • Sun, Sep 27, 2020 - 4:34am

    Hladini

    Hladini

    Status: Member

    Joined: Dec 28 2011

    Posts: 239

    2

    "Leave the Results to God"

    When we can truly detach from the results of our labor - leaving the results up to God - that is when we are truly liberated.

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  • Sun, Sep 27, 2020 - 6:35am

    VTGothic

    VTGothic

    Status: Bronze Member

    Joined: Jan 05 2020

    Posts: 261

    1

    To (virtually) eliminate war, fix the currency peg

    @ridgecrest said:

    I think the problem that we need to solve is can we create a system that will prevent financing wars, talking about real wars meaning bombing other countries. Looking at how we end up here, it's all because of wars not because of bad currency.

    I think bad currency is the facilitator of wars, when not the cause. And it's often the cause. Countries go to war to prevent revolution when currency is too debased - projecting the problem onto some foreign people. And even when that's not the case, countries that want to go to war finance it through debt, which requires bad currency.

    Consider the US financing WWII as an example. Without focusing on whether we were right to get into the conflict (I think we were), it remains true that it could only be financed by deficit spending, and only so many US War Bonds could be absorbed by the US public. The Treasury bought the additional that had to be purchased to provide the financing. That's a form of QE; ie, money debasement.

    We were able to retire a lot of that debt through reconstruction; and we were able to continue living the high life after reconstruction by exporting our deficit spending onto other nations through trade arrangements, and by devaluing the dollar vs. gold. Then came Vietnam on top of global military adventurism, featuring more devaluation of the dollar-to-gold ratio, and the eventual necessity of abandoning the gold peg altogether. That, in turn, has made it very easy to advance a perpetual state of foreign warfare and military "presence."

    Of course the world has benefited from the relative peace of Pax Americana, and we not less than anyone else. But the cost has exceeded the return, so debt has steadily increased. The untethering of currency has made constant inflation possible, and the creation of a massive debt headwind that we will not be able to get beyond.

    What we've lost as a result of unpegging is arguably much more than we gained. Jeff Booth makes exactly that case in his book, "The Price of Tomorrow," in which he (rightly) argues that advances in tech should produce deflation - that is, rising living standards based on getting more for fewer dollars. Or, put differently, the same purchasing power for fewer hours worked. Instead, we've all had to work faster and longer hours, and most barely stay even. No: most still fall slowly behind, as revolving credit debts and declining home ownership rates demonstrate.

    Imagine if we were still solidly tied to a gold peg. Wars could not be run by deficit: citizens would have to agree to be directly taxed (rather than covertly undermined) to pay for any foreign incursion; even for Pax Americana. That by itself would have prevented most of our post-1948 adventurism. The gains of technology would likely have come more slowly if cheap credit hadn't been around to fund most any harebrained idea, only some of which produced big advances, but the tech gains made would have been reflected in reduced prices. Then the once-promised labor-saving benefits of computers on every work desk (for example) could have led to shorter hours for the same purchasing power, not fewer employees doing more work for a diminishing real purchasing power.

    The US deficit wouldn't exist, either, if government had to pay back to citizens tomorrow the money it borrowed today, and the purchasing power of a dollar increased tomorrow - due to deflationary pressure rather than inflationary pressure. Taking on sovereign debt would then only make sense if its use led to improvements in domestic productivity. So, the highways system might still make sense, but funding increasingly dysfunctional educational outcomes would not. A drive for excellence would ensue.

    Nor would growing numbers of people be dependent upon government largesse just to get by, if each dollar would buy more tomorrow than it does today. In fact, the environment would be in better shape, too,  because we'd all be making more prudent considerations about the gizmos we need, since if we buy one today we'll be paying a premium over what it would cost next year when the dollar buys more. We'd also want our purchases to last as long as possible because we're paying a premium each time we buy one today rather than tomorrow; so fewer would be manufactured, greatly reducing waste and pollution. And it would make more sense to save money today than spend it, because savings would gain value over time rather than lose value - so consumerism would decline, replaced by more emphasis on experiential sources of satisfaction and fulfillment.

    But back to your concern about proper focus: money is the root of evil. And of good. So much depends on whether it's "good" money or "bad." And that's not a moral judgment, but a valuation of money's soundness. To be sound, money needs to be pegged to the most scarce resource in existence. Historically, that's been gold. Its consistent, slowly expanding and fairly predictable volume has stabilized gold-denominated currencies for centuries. Only by cheating that peg has any country ever created "bad" money, and that's always led to war and ruination, or ruination then war.

    Some of us think Bitcoin is the emerging new "gold standard" because it is even more absolutely scarce and supply-predictable than gold. Plus, it cannot be shaved (as Roman coins were, as a means to inflate), or cheated (because of its immutable blockchain). But even those who are not yet convinced ought to at least be able to see that it is by allowing currency to "float" on the "full faith and credit" of one or another government that the door is opened and an invitation is extended to the sociopaths and power-mongers to capture government and use it for self-aggrandizing adventurism, by beggaring the common people to enrich the few through inflation and taxation, while frittering the common wealth away by engaging in acts of interference and aggression elsewhere for personal and class-level power, prestige, and plunder.

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  • Sun, Sep 27, 2020 - 9:39pm

    Mark_BC

    Status: Bronze Member

    Joined: Apr 30 2010

    Posts: 408

    7

    Mark_BC said:

    I have been believing in stock market correction every year for 8-10 years and have kept money out of the "doomed markets."  Unfortunately, every year (so far) the stock market has risen causing me to miss out on the gains, and to be viewed as ungrounded in reality by my more traditionally minded family.

    Sand Puppy, I think I've been here about as long as you have and I went through similar phases, though not so dramatic. The alternative financial community has made a grave fundamental error (and I was a part of that as well), and continues to make it. Even on this site up until last week, there have been weekly warnings about an imminent stock market catastrophe over the last 10 years, with the inevitable charts of the South Seas Bubble or Tulip Mania shown as evidence that all bubbles revert to the mean. But the crash never happens. Or if we get a significant correction, the market always in due time comes back up and then gains even more. The critical mistake being made here is the timeline in question, and a failure to understand how IT IS INDEED DIFFERENT THIS TIME.

    Why is it different this time?

    1. The stock market bubble is piggy backing on the mother of all debt market (currency) bubbles. It is unreasonable to suggest that the stock market bubble will crash in this environment of zero interest rates and money printing. It will not crash until money fails, or shortly before. And a small stock market crash will not be the trigger of a larger debt market crash.
    2. The monetary system and stock market are directly and digitally controlled by "The Powers That Be". To this day, it ceases to amaze me how every week there can be people here and elsewhere arguing that the market moves based on fundamental market forces, while at the same time decrying the manipulation of "markets". Can they not put two and two together? I simply do not understand how this can come from people who claim to be able to see past the distractions. Cognitive Dissonance is the only explanation I can come up with. In this day and age where every word you type on the internet is recorded and every word you say is eaves dropped by your phone and recorded in your file, how can anyone actually believe that the stock market is NOT controlled by the central monetary authorities? And if so, then what rationale could possibly be used as a basis to argue that it will behave like the South Seas bubble? The endless warnings about how TSLA is going to crash to its true value next week are absurd. If it was going to crash, it would have crashed many years ago. How can people not understand that TSLA is a darling of the Powers That Be and is being supported by the central authorities? It is so blatant.

    Neither of the above were the case in the medieval bubbles used as analogies to warn of the imminent stock market crash. Back then, money had real hard backing, real interest rates, and no government or bank had any control control of these "free markets" that experienced the bubble.

    So... my opinion is... yes, the alternative economics community is definitely on to something with their exposing of the corruption in the financial system, and that it will eventually crash. But they have a real problem putting into perspective the magnitude and extent of that corruption, and therefore don't do a very good job of predicting future trends and when the current "bubble" will end. If you look back over the last 10 years, the dominant narrative of what the alternative financial community has been saying was about the worst investment advice out there. But maybe they will end up being right, if you can hang in there that long.

    But it will end, that is for sure. We can have fun and try to figure out when, but ultimately the only people who know when it will end are The Powers That Be. And you can be sure they have a plan to prevent you from getting rich off it. So try to use your special understanding of the financial system to get wealthy off it BEFORE it crashes.

    So my advice is to be aware of and plan for the inevitable "end", but don't let it rule your life and don't lose sight of normal life too much, and don't position yourself so you can't prosper within the mainstream world as well, because for all we know this could go on another 15 years. Or maybe it will end next year. None of us know.

    Sometimes things change gradually. Other times things change dramatically and abruptly.

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  • Mon, Sep 28, 2020 - 9:39am

    ridgecrest

    ridgecrest

    Status: Member

    Joined: Dec 05 2019

    Posts: 2

    1

    to @vtgothic

    I agree with everything you said, however it's easy to say than do. Think for instance if US uses a currency that respect fairness and good, how do you get China and other nations to follow? basically you will limit yourself from financing wars while others might not care and destroy you easily.

    I'm going to tell you a story, when I was a kid, I used to ride a donkey to get to work (fields), now I ride a car, going back to that life is easier for me because I have that experience and my kids know that as well. The market/currency crush is not what scares me, I can fix that by starting from zero again at any age. Wealth for me is not money, wealth is what you are and what you can do as a person/community not how much junk you can buy. Problem in American culture is associating wealth with money, even banks ask you how much is your net worth? meaning how much money/assets you have. My net worth is not just assets, I can survive in desert without water, I can build a house with stone and dirt insulated, that's wealth for me. However if a guy with a gun shows up at my door, I'm basically done because I don't have security, so unless you can come up with a currency that will fix security for everybody, it's not a problem for me.

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  • Mon, Sep 28, 2020 - 10:25am

    #59
    wotthecurtains

    wotthecurtains

    Status: Bronze Member

    Joined: Feb 27 2020

    Posts: 99

    2

    Riding Donkey To Work

    "I'm going to tell you a story, when I was a kid, I used to ride a donkey to get to work (fields), now I ride a car, going back to that life is easier for me because I have that experience and my kids know that as well."

     

    I never rode no Donkey but I did grow up with much more "working class" expectations.   As a result I can buy the latest Ipad or fly to Europe and very much appreciate my status as a tourist in the upper middle social class.  

     

    Like you, I can go back when the time comes and honestly have some fun doing it.   This is the greatest gift that my parents who were probably a bit on the young side to have kids could have given me.

     

    I keep reading that we humans are so afraid of death that we drive ourselves mad with distraction.  I must be in deep denial because I've never felt expecially "afraid" of it.   I have a young son so the next few years would not be a good time to die but other than that, I keep thinking "shit man, enjoy this party for as long as it lasts and forget whatever the fuck Chuck and Nancy are up to.

     

    There is simply too much going on for our brains to assimilate so focus on what pleases you instead.  I just spent my last weekend doing a poor job of this, but I did have some fun and I intend to do better next time.

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  • Mon, Sep 28, 2020 - 1:06pm

    agitating prop

    agitating prop

    Status: Silver Member

    Joined: May 28 2009

    Posts: 458

    3

    Mark BC

    Just over twenty years ago, my sister and I had about the same amount of money (give or take a couple of hundred thousand) to purchase a house. She purchased in West Van and my late husband and I purchased on an island not too far away. Husband and I wanted enough to buy a house, clear title and buy some precious metals...and after he died and I sold the place, it had gone up 50%. Precious metals doubled from point of purchase.

    But, in the mean time, my sister's place in West Van, originally purchased for went up 1000% or more in value. That's three zeros, not two.

    Using common sense, this never should have happened. Like never. And people have been waiting out that inevitable drop in prices, after prices in Vancouver merely doubled in value, for over 10 years. It hasn't happened and they saw their most outsized gains in 2016. Prices went UP  for single family detached in that area, during the pandemic!

    It's bulletproof. And yes, it has something to do with our own 'fed' But it also has to do with foreigners seeking safe havens for laundered money or honest foreigners with big bucks immigrating.

    I have read several horror stories of young people saving every cent they had over the last 15 years, in order to buy into the inevitable collapse in prices. In the mean time having much of their savings eaten up by their landlords. It's tremendously sad. These people have kids and are shoehorned into tiny apartments.

    I feel that what is happening currently, in the stock market,  has something to do with investors pursuing safe havens to hedge against inflation even though the logic is limited, as you have described so well. But then again, that is from a common sense perspective, another factor you have detailed.

    Though I have to say, if investors are buying stock in corporations that are oligopolies, (which will become more and more like functional monopolies), it may not be the worst strategy. Look at Amazon. Perfect example.

    It's terribly sad that governments help to create sharks in the economic ecosphere. In order to survive we have to jump on like remoras and other parasites feeding off the largesse.

    Things should revert to fundamentals, or 'the trend is your friend.' Which one wins out?

     

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  • Mon, Sep 28, 2020 - 1:12pm

    #61

    Mark_BC

    Status: Bronze Member

    Joined: Apr 30 2010

    Posts: 408

    0

    Mark_BC said:

    My parents sold a really nice house in North Van in 2003. Ouch. Now I can barely afford to rent in Vancouver.

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  • Mon, Sep 28, 2020 - 1:20pm

    #62
    agitating prop

    agitating prop

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    Joined: May 28 2009

    Posts: 458

    0

    Ouch!

    Oh Mark, So sorry to hear that. I wasn't sure what the BC stood for. I thought it might mean Before Christ!

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  • Mon, Sep 28, 2020 - 1:43pm

    Mark_BC

    Status: Bronze Member

    Joined: Apr 30 2010

    Posts: 408

    0

    Mark_BC said:

    It's my initials, where I live, and also I used to spend a good amount of time in Baja California.

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  • Tue, Sep 29, 2020 - 9:52am

    #64

    Mark_BC

    Status: Bronze Member

    Joined: Apr 30 2010

    Posts: 408

    0

    Mark_BC said:

    FWIW, I think that Gregory Mannarino's daily Youtube updates provide the best real-time investment advice out there in terms of understanding and accepting how corrupt and manipulated the system is, but using this to your advantage to make gains of central bank credits (dollars), however fundamentally "worthless" those are (but you can still buy a house with those "worthless" bank credits!) I think he might go off the deep end a bit with some of the commentary around Covid, but his financial analysis is spot on. He hits it home every time. Cautiously buying call options in this environment is a no-brainer IMO.

    So I think we should take the best of both worlds; prepare yourself mentally, financially and situationally for the "end" whenever that happens, but keep one foot in the mainstream to take advantage of opportunities that present themselves.

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  • Sun, Oct 04, 2020 - 12:23pm

    #65
    Hanomy

    Hanomy

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    Joined: Oct 04 2020

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    Hanomy said:

    The blueprint of that system is in  HANOMY MANIFESTO *system* at HANOMY.COM

    I am also the author of Hanomy Manifesto *system* at Hanomy.com If you believe that the worldwide RESET is coming, I hope you help me spread the words of Hanomy. Hanomy is a worldwide paradigm shift in the social, financial, and political system to harmonize living for all. We can do it now because of the technology and human knowledge we have. It will create a win-win position for all countries (high/low debt alike), animals, the environment, people of all classes, and setting path for humanity for many generations to come. I am trying to get people around the world to aware of Hanomy so that once the RESET comes, we can have an alternative to discuss about ... worldwide. If anyone wants to be a part of this worldwide grassroots I am working on, please contact me. I need helps in all functions ... arts/web/translator/spreadsheet etc. Thank you. [email protected] Highlights of Hanomy:

    • Fundamental human needs met throughout life’s existence

    • Basic human rights observed everywhere

    • Sovereign debts worldwide are settled and eliminated

    • Upheld liberty and freedom

    • Financial contributions drawn from a portion of idle/unutilized money

    • No taxes on income, profit or spending

    • Interest charges and usury practices abolished

    • Power of money creation where it belongs - the people

    • An end to the fractional reserve system

    • Upheld free market principles (true capitalism but with social responsibility)

    • Decreased or dissolved inflation and hyperinflation

    • Reduced income inequality

    • An end to corporate welfare

    • Advanced technology benefiting humanity

    • Freedom of time for quality of life and caregiving

    • Prohibited conditions for authoritarianism

    • Preserved sovereignty and respected borders

    • An end to “modern day slavery” (this includes you)

    • Improved care of the environment and world resources

    • A world we’re proud to claim and pass along

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