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> Some people will want to buy food with these coins, but they have no goods or services to ever offer in return (that's the whole point of UBI). Is that true?

> Some people will want to buy food with these coins, but they have no goods or services to ever offer in return (that's the whole point of UBI). Is that true? The whole point is that these coins themselves will have value. There will be no such thing as PoorCoin. It doesn't matter whose coins they are so long as they are real and trusted (as in not fake). I don't think there's any correlation to trust and economic output as you are describing. The unique thing here is no one is funding the system - it's being mined out of the system itself. Just like no one truly "funded" Bitcoin. The difference is that mined coins are equally distributed, always, instead of to the miner, who will no longer be needed. As mentioned I believe in the paper and at least in the comments here, a trusted identity system is required in tandem with this.

PeterisP 9y ago
Read the article carefully, that's the exact consequence of the core system. Assume a rich community and a poor community, where each of them trusts everyone else in their community and noone else. In this case, there can't be trade between the communities. Assume that Alice from the rich community trusts Bob from the poor community. This will allow Carol from the poor community to get stuff from Dave in the rich community - if Carol spends one coin, then Dave will get 1 Alicecoin, Alice will get 1 Bobcoin, and Bob will get 1 Carolcoin. This can only happen up until Bob runs out of Bobcoins (since Alice won't accept Carolcoin) or until Alice runs out of Alicecoins (since Dave won't accept any coins from the poor community) - so the whole community will have "consumed" the generated resources of those intermediaries. There needs to be a sustained flow of coins from the poor community to the rich community to enable the flow of goods from the rich community to the poor community. If the system can't enable (and motivate!) the rich people perpetually accumulating coins of poor people, then it's not an UBI system. The poor people got their coins, spent them for stuff, and have no coins remaining. So inevitably someone else had stuff, traded it away, and now has coins of those poor people, i.e. that someone funded the system. If there's noone funding the system, then noone can get real stuff out of the system - you can't create food out of thin air. UBI is a mechanism where large number of people can get food and services for nothing - so, for that to be possible, someone else needs to give out food and services for nothing.
- adjkant 9y ago
  Interesting, thanks for the substantive reply. I'm not convinced fully but I think you've highlighted a problem area. The thing I see is that the coins the rich community got for the food still have value. They can trade them for other resources, workers, and still manufacture things. Let's say this is a bakery. They can still buy flour and eggs and hire bakers (let's say this is a bit bigger than a mom and pop shop). So people still need to work at some level, but they will have enough money to buy bread and feed themselves always. I'm wondering how that balance works though (aka how much of COL is actually given by the UBI, and what variables change this). > If there's noone funding the system, then noone can get real stuff out of the system I don't think this is true. See currencies everywhere that no longer hold to a gold standard, etc. No one is funding the value behind printing money. Why it works is because of confidence and agreed upon value of the currency, which is required here in the same way. I'm wondering how this could possibly tie in with a deflationary currency used in tandem with it, and an exchange rate between UBICoin and StagantCoin. I'm spitballing here with little economics background though so I'm not claiming there isn't a central flaw there, but I'm curious what results.
  - PeterisP 9y ago
    Okay, in the example of the poor community, the rich community can trade some of the coins back to the poor community for labor. Assuming that the farmers aren't as poor, the poor people have no flour or eggs to sell, but they can sell off some labor. However, let's assume the third community, who are homeless and permanently unemployable for mental health reasons, and (for the sake of argument) will never ever earn a coin from anyone else. Since this system enforces a 1-to-1 exchange rate, can you name any practical difference whatsoever between Alice trusting one of those people for 1 coin (i.e. they'll be able to trade with someone in a scenario where that someone will get 1 AliceCoin and Alice will get 1 Homelesscoin) and simply gifting 1 AliceCoin as charity? IMHO there is none, except Alice would be able to "keep score" of how much she has given to charity. This is a key issue here, that with this system trust isn't simply "Bob is who he claims to be", in this system trust means "I'm willing to guarantee that Bob's coins are as good as mine by agreeing to an automatic 1-to-1 trade", in essence you're willing to co-sign any purchase Bob makes since sellers will happily take your coins instead of Bob's; and in any environment where's an innate disbalance (i.e. your coins actually are more valuable than Bob's because more people will trust your coins) this arbitrage will be exploited up to your trust limit, resulting in you losing your coins and gaining Bobs coins instead. The same applies with community coins; no matter what happens, the coins of some communities will be de facto more valuable than others, so any link of trust between these communities will be arbitraged by that built-in 1-to-1 trade option until that trust runs out and trade between those communities stops. If someone makes a 1-to-x trade reflecting the actual difference of market power, then again people can exploit the built in 1-to-1 trades - so there's a strong disincentive for anyone to make that trust between those communities, since you have to bet (and spend!) your resources in keeping the different currencies linked. The system doesn't provide for "partial trust" of say, 1-to-0.8; you have to be totally sure that Bob's coins are as good as yours, since by making the trust link you're willing to trade all your coins for Bob's coins automatically (with no confirmation or refusal possible) at a 1-to-1 rate. There's a lot of theory and experience for national currencies pegged to each other - and how it can get exploited for financial gain (e.g. Soros had some profitable deals).

PeterisP 9y ago

Read the article carefully, that's the exact consequence of the core system. Assume a rich community and a poor community, where each of them trusts everyone else in their community and noone else. In this case, there can't be trade between the communities. Assume that Alice from the rich community trusts Bob from the poor community. This will allow Carol from the poor community to get stuff from Dave in the rich community - if Carol spends one coin, then Dave will get 1 Alicecoin, Alice will get 1 Bobcoin, and Bob will get 1 Carolcoin. This can only happen up until Bob runs out of Bobcoins (since Alice won't accept Carolcoin) or until Alice runs out of Alicecoins (since Dave won't accept any coins from the poor community) - so the whole community will have "consumed" the generated resources of those intermediaries. There needs to be a sustained flow of coins from the poor community to the rich community to enable the flow of goods from the rich community to the poor community. If the system can't enable (and motivate!) the rich people perpetually accumulating coins of poor people, then it's not an UBI system. The poor people got their coins, spent them for stuff, and have no coins remaining. So inevitably someone else had stuff, traded it away, and now has coins of those poor people, i.e. that someone funded the system. If there's noone funding the system, then noone can get real stuff out of the system - you can't create food out of thin air. UBI is a mechanism where large number of people can get food and services for nothing - so, for that to be possible, someone else needs to give out food and services for nothing.

adjkant 9y ago
Interesting, thanks for the substantive reply. I'm not convinced fully but I think you've highlighted a problem area. The thing I see is that the coins the rich community got for the food still have value. They can trade them for other resources, workers, and still manufacture things. Let's say this is a bakery. They can still buy flour and eggs and hire bakers (let's say this is a bit bigger than a mom and pop shop). So people still need to work at some level, but they will have enough money to buy bread and feed themselves always. I'm wondering how that balance works though (aka how much of COL is actually given by the UBI, and what variables change this). > If there's noone funding the system, then noone can get real stuff out of the system I don't think this is true. See currencies everywhere that no longer hold to a gold standard, etc. No one is funding the value behind printing money. Why it works is because of confidence and agreed upon value of the currency, which is required here in the same way. I'm wondering how this could possibly tie in with a deflationary currency used in tandem with it, and an exchange rate between UBICoin and StagantCoin. I'm spitballing here with little economics background though so I'm not claiming there isn't a central flaw there, but I'm curious what results.
- PeterisP 9y ago
  Okay, in the example of the poor community, the rich community can trade some of the coins back to the poor community for labor. Assuming that the farmers aren't as poor, the poor people have no flour or eggs to sell, but they can sell off some labor. However, let's assume the third community, who are homeless and permanently unemployable for mental health reasons, and (for the sake of argument) will never ever earn a coin from anyone else. Since this system enforces a 1-to-1 exchange rate, can you name any practical difference whatsoever between Alice trusting one of those people for 1 coin (i.e. they'll be able to trade with someone in a scenario where that someone will get 1 AliceCoin and Alice will get 1 Homelesscoin) and simply gifting 1 AliceCoin as charity? IMHO there is none, except Alice would be able to "keep score" of how much she has given to charity. This is a key issue here, that with this system trust isn't simply "Bob is who he claims to be", in this system trust means "I'm willing to guarantee that Bob's coins are as good as mine by agreeing to an automatic 1-to-1 trade", in essence you're willing to co-sign any purchase Bob makes since sellers will happily take your coins instead of Bob's; and in any environment where's an innate disbalance (i.e. your coins actually are more valuable than Bob's because more people will trust your coins) this arbitrage will be exploited up to your trust limit, resulting in you losing your coins and gaining Bobs coins instead. The same applies with community coins; no matter what happens, the coins of some communities will be de facto more valuable than others, so any link of trust between these communities will be arbitraged by that built-in 1-to-1 trade option until that trust runs out and trade between those communities stops. If someone makes a 1-to-x trade reflecting the actual difference of market power, then again people can exploit the built in 1-to-1 trades - so there's a strong disincentive for anyone to make that trust between those communities, since you have to bet (and spend!) your resources in keeping the different currencies linked. The system doesn't provide for "partial trust" of say, 1-to-0.8; you have to be totally sure that Bob's coins are as good as yours, since by making the trust link you're willing to trade all your coins for Bob's coins automatically (with no confirmation or refusal possible) at a 1-to-1 rate. There's a lot of theory and experience for national currencies pegged to each other - and how it can get exploited for financial gain (e.g. Soros had some profitable deals).