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Wow, crazy idea. However, no matter how good or plausible this idea is, it's extremely vulnerable to itself... Central banks have power not only because they

by hc07 11y ago

Wow, crazy idea. However, no matter how good or plausible this idea is, it's extremely vulnerable to itself... Central banks have power not only because they can issue currency, but also because they are a monopoly (in their sphere of influence). Nothing stops someone else, including the govt or someone trying to destroy the system, from replicating this and give out Another Dollar (AD). In fact, if there's even a hint this is popular, I expect to see this co opted by big corporations or entities with far more resources. Wal-Mart Dollars, Amazon Dollars, might all show up, which actually destroys the trust of this kind of system. This is the killer of almost all innovations, the innovator's dilemma. How could you guarantee it's only you?

Suncho 11y ago
The glib answer I usually give people is that it would be great if someone stole my idea because then the world's economy would fix itself without my help. I'd just go back to having fun and doing my own thing. I've long assumed that basic income was inevitable. I didn't know how we'd get there, but I was optimistic about the future. I still believe that basic income is inevitable, but now I have a way to help it happen sooner and more smoothly. But I'm sure my investors won't be entirely happy with that answer. I actually do feel it's important for Gresham Dollar to succeed. If someone else tries to do it, they might do it wrong. If someone else tries to execute on this idea, but they don't get it quite right, it'll be a rough road for our economy. How could you guarantee it's only you? The answer is that I can't guarantee that it's only me, but because of the network effect inherent in money, it has to be only someone. Money is a natural monopoly. So if we're the first to disrupt money in this way, it's going to take a lot of resources to dislodge us. The more popular Gresham Dollar gets, the more someone else will want to copy it, but the harder it gets for them to be able to succeed in doing so. In fact, if there's even a hint this is popular, I expect to see this co opted by big corporations or entities with far more resources. Wal-Mart Dollars, Amazon Dollars, might all show up, which actually destroys the trust of this kind of system. I don't know. The less people trust Gresham Dollar, or any Gresham Dollar-Type (GDT) currency, the more likely they are to spend it. Lack of trust, in some ways, actually boosts a GDT. What's critical is that we make the whole thing user-friendly. It should be seemless to switch between spending GD, USD, other GDTs, and any other currencies that are in the mix. It's always been the plan for Gresham Dollar to integrate well with other currencies besides USD. This should include other GDTs. I can imagine a scenario in which the various GDTs work synergistically together. You could have multiple big corporations each with their own USD reserves backing their own GDT and providing their own basic income and we'd have a system for exchanging between the GDTs. For example, let's say Walmart has Walmart Bucks as their GDT. If you can only spend Walmart Bucks at Walmart, Walmart Bucks aren't going to take over the world, but they could be an important part of the overall GDT eco-system. We would hold a reserve of Walmart Bucks and provide a facility for people to exchange their Walmart Bucks for GD at slightly less than par. If a GD user wants to shop at Walmart, he can save money by first converting his GD to Walmart bucks. Ideally, this process would be automatic. Wow, crazy idea. Thanks!
- hc07 11y ago
  I'm thinking bigger than Wal-Mart. I'm thinking the world's largest foreign reserve owners, China and Japan. In fact, in China's attempt to weaken their yuan, do capital controls, provide growth and jobs to they're lowest populace so the central govt doesn't face revolt -- You see the shadow of GD and BI China even went so far to implement economically irrational activities like state owned enterprises, whose primary goal is to keep people employed and have some income, so there's no revolt. (For those that don't know, China govt is especially sensitive to revolt, much more than U.S. Because it happened so many times in history and the prior government members are all killed in a major way when it happens). Thus, economic rationality be damned even if these SEOs are bleeding gobs of money or blowing a debt bubble. Taken together, a lot of your Gresham dollars / basic income properties are already in place. In spirit at least. And we see the flaws/limits. Even with China's massive reserve, recently there have been coordinated attack by hedges including Soros, draining its reserves. And internal rich people are engaged with massive capital flight (despite the controls). And the basic incompatibility of long term BI sapping productive parts of the country, all show up. At this point, either SEO(which is really like China's BI) goes away for good, or China will blow a debt bubble so big, that it explodes and kills everything, SEO included. Or USA included unfortunately.
  - Suncho 10y ago
    China and Japan each have their own currencies. If they wanted to provide a basic income right now, they could pay for it by issuing new Yuan or Yen. The Gresham's Law hack is for bootstrapping a new currency, so they don't need it. But so long as they forgo basic income, their currencies are vulnerable to disruption by a currency like Gresham Dollar. China is inventing fake jobs and facilitating a massive credit bubble in an effort to prop up economic growth. Taken together, a lot of your Gresham dollars / basic income properties are already in place. In spirit at least. In what sense? Basic income is continually replenishes the economy with fresh money, lessening the role of unstable credit. That's not what's happening in China. And we see the flaws/limits. Do you believe that Gresham Dollar would lead to a credit bubble? And the basic incompatibility of long term BI sapping productive parts of the country, all show up. I'm not convinced that China's state-owned enterprises are a useful proxy for basic income. Do you believe that basic income would sap productive parts of the economy?

by hc07 11y ago

Suncho 11y ago

The glib answer I usually give people is that it would be great if someone stole my idea because then the world's economy would fix itself without my help. I'd just go back to having fun and doing my own thing. I've long assumed that basic income was inevitable. I didn't know how we'd get there, but I was optimistic about the future. I still believe that basic income is inevitable, but now I have a way to help it happen sooner and more smoothly. But I'm sure my investors won't be entirely happy with that answer. I actually do feel it's important for Gresham Dollar to succeed. If someone else tries to do it, they might do it wrong. If someone else tries to execute on this idea, but they don't get it quite right, it'll be a rough road for our economy. How could you guarantee it's only you? The answer is that I can't guarantee that it's only me, but because of the network effect inherent in money, it has to be only someone. Money is a natural monopoly. So if we're the first to disrupt money in this way, it's going to take a lot of resources to dislodge us. The more popular Gresham Dollar gets, the more someone else will want to copy it, but the harder it gets for them to be able to succeed in doing so. In fact, if there's even a hint this is popular, I expect to see this co opted by big corporations or entities with far more resources. Wal-Mart Dollars, Amazon Dollars, might all show up, which actually destroys the trust of this kind of system. I don't know. The less people trust Gresham Dollar, or any Gresham Dollar-Type (GDT) currency, the more likely they are to spend it. Lack of trust, in some ways, actually boosts a GDT. What's critical is that we make the whole thing user-friendly. It should be seemless to switch between spending GD, USD, other GDTs, and any other currencies that are in the mix. It's always been the plan for Gresham Dollar to integrate well with other currencies besides USD. This should include other GDTs. I can imagine a scenario in which the various GDTs work synergistically together. You could have multiple big corporations each with their own USD reserves backing their own GDT and providing their own basic income and we'd have a system for exchanging between the GDTs. For example, let's say Walmart has Walmart Bucks as their GDT. If you can only spend Walmart Bucks at Walmart, Walmart Bucks aren't going to take over the world, but they could be an important part of the overall GDT eco-system. We would hold a reserve of Walmart Bucks and provide a facility for people to exchange their Walmart Bucks for GD at slightly less than par. If a GD user wants to shop at Walmart, he can save money by first converting his GD to Walmart bucks. Ideally, this process would be automatic. Wow, crazy idea. Thanks!

hc07 11y ago
I'm thinking bigger than Wal-Mart. I'm thinking the world's largest foreign reserve owners, China and Japan. In fact, in China's attempt to weaken their yuan, do capital controls, provide growth and jobs to they're lowest populace so the central govt doesn't face revolt -- You see the shadow of GD and BI China even went so far to implement economically irrational activities like state owned enterprises, whose primary goal is to keep people employed and have some income, so there's no revolt. (For those that don't know, China govt is especially sensitive to revolt, much more than U.S. Because it happened so many times in history and the prior government members are all killed in a major way when it happens). Thus, economic rationality be damned even if these SEOs are bleeding gobs of money or blowing a debt bubble. Taken together, a lot of your Gresham dollars / basic income properties are already in place. In spirit at least. And we see the flaws/limits. Even with China's massive reserve, recently there have been coordinated attack by hedges including Soros, draining its reserves. And internal rich people are engaged with massive capital flight (despite the controls). And the basic incompatibility of long term BI sapping productive parts of the country, all show up. At this point, either SEO(which is really like China's BI) goes away for good, or China will blow a debt bubble so big, that it explodes and kills everything, SEO included. Or USA included unfortunately.
- Suncho 10y ago
  China and Japan each have their own currencies. If they wanted to provide a basic income right now, they could pay for it by issuing new Yuan or Yen. The Gresham's Law hack is for bootstrapping a new currency, so they don't need it. But so long as they forgo basic income, their currencies are vulnerable to disruption by a currency like Gresham Dollar. China is inventing fake jobs and facilitating a massive credit bubble in an effort to prop up economic growth. Taken together, a lot of your Gresham dollars / basic income properties are already in place. In spirit at least. In what sense? Basic income is continually replenishes the economy with fresh money, lessening the role of unstable credit. That's not what's happening in China. And we see the flaws/limits. Do you believe that Gresham Dollar would lead to a credit bubble? And the basic incompatibility of long term BI sapping productive parts of the country, all show up. I'm not convinced that China's state-owned enterprises are a useful proxy for basic income. Do you believe that basic income would sap productive parts of the economy?