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Terrifying, really. The world is hurdling back towards a feudalist society, with corporations instead of kings.
by _bxg1 7y ago
Terrifying, really. The world is hurdling back towards a feudalist society, with corporations instead of kings.
- gridlockd 7y agoThis is a bunch of nonsense. Actual banks are corporations like Facebook and they're far scarier.
- toomuchtodo 7y agoBanks are heavily regulated [1]. Facebook is not. EDIT: If Facebook wants to come to the finance party, I welcome them accepting the regulatory burden imposed by federal regulators and the finance industry itself. Disclaimer: I work in financial services, specifically interfacing with regulatory bodies. [1] https://www.fdic.gov/regulations/laws/rules/ https://www.fdic.gov/regulations/laws/rules/ (Example FDIC Laws, Regulations, and Acts, none of which currently apply to silicon valley corporations, but all of which apply to banking institutions)
- staunch 7y agoAmong many other great crimes, U.S. banks have stolen hundreds of billions of dollars from the poorest people through overdraft and bounced check fees. The banks own the regulators. If regular people can just have a safe place to keep their money, without being actively exploited, that would be a huge improvement.
- toomuchtodo 7y agoYou will need to construct a more targeted argument than, "All banks bad, all banks hurt people". The majority of Americans store their money in banks safely (and while the unbanked and underbanked is a huge problem, it is out of scope for this comment), protected either by FDIC insurance (banks) or NCUSIF (credit unions). The majority of banks behave responsibly (I don't work at BoA, Wells, JPMC, or someone else who has committed fraud). You don't even have to use a bank! That is what your local credit union is for [1]. Some banks have behaved badly. All cryptocurrency is a scam (see: SEC ICO determinations, outright ICO/token fraud, etc). With fiat, you have recourse with regulators and the legal system. With crypto, you have none ("oops! someone cloned your SIM and you've lost your entire nest egg. better luck next time!"). Your arguments don't make the case for cryptocurrencies; you make the case for more regulation and oversight of the banking and financial services industry (which I agree with entirely, not because it's my job, but to keep the hard earned assets of banking customers of all income and asset brackets safe). [1] https://www.mycreditunion.gov/about-credit-unions/credit-union-locator https://www.mycreditunion.gov/about-credit-unions/credit-uni...
- shadowfiend 7y agoYou will need to construct a more targeted argument than, “All cryptocurrency is a scam” if you want others to construct more targeted arguments than “all banks bad” (the difference being you had to paraphrase GP, while I got to directly quote you). Cryptocurrency is infrastructure, while you are arguing against it as a replacement for all players in the current financial system. I would argue that's a shortsighted and under-informed perspective.
- toomuchtodo 7y agohttps://www.wired.com/story/theres-no-good-reason-to-trust-blockchain-technology/ https://www.wired.com/story/theres-no-good-reason-to-trust-b... (Bruce Schneier: There Is No Good Reason To Trust Blockchain Technology) https://www.dailycal.org/2018/03/09/father-internet-vint-cerf-speaks-bitcoin/ https://www.dailycal.org/2018/03/09/father-internet-vint-cer... (Vint Cerf: "In addition to discussing the history and advancement of internet technology, Cerf talked about cryptocurrency. When asked about bitcoin, Cerf said his first response was to “run the other way.” On the topic of blockchain, he struck a more moderate tone but cautioned about its applications.") https://www.cnbc.com/2019/03/25/bank-of-america-skeptical-on-blockchain-despite-having-most-patents.html https://www.cnbc.com/2019/03/25/bank-of-america-skeptical-on... (Bank of America tech chief is skeptical on blockchain even though BofA has the most patents for it) https://www.fnlondon.com/articles/breaking-the-blockchain-major-projects-shelved-as-hype-fades-20180911 https://www.fnlondon.com/articles/breaking-the-blockchain-ma... (Breaking the blockchain: Major projects shelved as hype fades) https://www.bloomberg.com/news/articles/2019-05-29/blockchain-settlement-was-slow-costly-in-trial-weidmann-says https://www.bloomberg.com/news/articles/2019-05-29/blockchai... (Bundesbank: Blockchain Settlement Was Slow, Costly in Trial, Weidmann Says: “The blockchain solutions did not fare better in every way: the process took a bit longer and resulted in relatively high computational costs,” Weidmann said in Frankfurt on Wednesday. “Similar experiences have been made elsewhere in the financial sector. Despite numerous tests of blockchain-based prototypes, a real breakthrough in application is missing so far.”) Distributed ledgers, blockchain, and cryptocurrency are solutions looking for a problem, overly complicated and underperformant infrastructure. They attempt to solve for trust with technology solutions in a world governed by human regulation and legal frameworks (which always take precedence). A database will work just fine. Everything else is snake oil.
- navigatesol 7y ago>Among many other great crimes, U.S. banks have stolen hundreds of billions of dollars from the poorest people through overdraft and bounced check fees. I can agree with the fact that some of the bank fees for such services are ridiculous, but how is a customer using their overdraft or bouncing a check the bank's fault? How is it "stealing"?
- toomuchtodo 7y agoIn the case of overdraft fees, over 30 banks were ordering transactions in a punitive way, charging up to six overdraft fees per day, and not providing a way to decline charges when an overdraft (and related fee) would result. It also resulted in the Federal Reserve instituting overdraft protection regulations in 2010. It was predatory, plain and simple, and hundreds of millions of dollars in collective fines were paid. https://www.seattletimes.com/business/chase-reaches-settlement-to-pay-110-million-in-overdraft-fee-case/ https://www.seattletimes.com/business/chase-reaches-settleme...
- pault 7y agoOrdering transactions from large to small so you are hit with the maximum number of penalties. It can easily end up costing you many multiples more than ordering chronologically.
- xrd 7y agoDo a Google search for Wells Fargo and overdrafts.
- lurker458 7y agoFacebook is not even a safe place for your cat pictures. Why would they do a better job when it comes to your money ?
- camjohnson26 7y agoAt best regulations act as a moat keeping competition away the entrenched banks. As soon as the government comes up with rules the smart people at the banks find a way to get around it and make money. Startups don’t have the legal expertise and can’t compete.
- jakelazaroff 7y agoIf that's the case, why do banks consistently push to loosen regulations? Can you point to an instance of banks lobbying for increased oversight and restrictions? Making a bank should be hard. I don't want some unknown startup to come in to "move fast and break things", because "things" in this case means "people's savings".
- camjohnson26 7y agoWell there’s the CEO of Bank of America saying “Dodd-Frank is fine, None of us are trying to touch it”. The big banks could push a lot harder against regulation than they do. https://www.economicclub.org/sites/default/files/MoynihanExcerpts.pdf https://www.economicclub.org/sites/default/files/MoynihanExc...
- sp332 7y agoRegulations can raise barriers to entry. But "at best", banks haven't just gambled away all the deposits leaving customers with no recourse lately. Wells Fargo has been defrauding a lot of people, but at least they're paying billions in fines for it. It's not enough to keep them from doing it I guess, but I'd argue that fewer regulations would probably make that situation worse and not better.
- camjohnson26 7y agoHow do you know that regulations are why the banks haven’t gambled away all the money? There’s no law against me gambling away my savings but that doesn’t mean I’ll do it. There’s other incentives in the system, for example the desire to avoid an angry mob of depositors burning your bank to the ground. Some regulations are good but the ones we have are overburdensome. Even huge startups like Robinhood can’t get it right and the laws around what constitutes a security for ICO offerings are so vague that no one actually knows if they’re breaking the law or not.
- gridlockd 7y agoFacebook also isn't becoming a bank. If anything, Facebook is becoming a payment processor (not really, but close enough). Why trust your money with Paypal, but not Facebook? When given the choice between a monolithic corporation and some kind of cryto-based federation, why choose the former? How is any of this worse than what we already have?
- elliekelly 7y agoOur banking system certainly leaves a lot to be desired but I’d take Bank of America over Facebook pretending to be a bank 100% of the time. And I have never said a nice thing about BoA in my life. What’s scarier to me is that Facebook is deliberately and admittedly targeting the unbanked - the people most in need of a bank but also the people most at risk of being taken advantage of. I’m afraid this will be the silicon valley version of a prepaid debit card/check cashing business run by Facebook instead of Wal-Mart.
- cjslep 7y agoIt's a whole new avenue for predatory lending practices such as payday loans, too.
- nickbauman 7y agoI was just thinking exactly that: this is a check-cashing "bank" that preys on the poor and disenfranchised especially.
- gridlockd 7y agoYeah, we should totally leave that business to the payday loan shacks, right?
- nickbauman 7y agoRight, and let Facebook do it _at scale._ What could possibly go wrong?
- logfromblammo 7y agoI would stake Bank of America through the heart, bind it with chains until sunrise, vitrify the dust, and then dump the evil slag into an ocean trench, and I'd still bank there long before trusting Zuckerberg's Facebook with my money.
- gridlockd 7y ago> Our banking system certainly leaves a lot to be desired but I’d take Bank of America over Facebook pretending to be a bank 100% of the time Facebook isn't pretending to be bank. Facebook is pretending to be a payment processor. What's the big deal? Nobody is telling you to put all your savings into a centralized cryptocurrency, especially considering you're a US citizen with access to relatively good banking system.
- mmsimanga 7y agoFrom where I am standing I wonder if this is not reflection of the ineffectiveness of governments. In my part of the world there is a lot more talk about devolution, basically self governance of the different regions. Everyone is sick and tired of decisions being made from the capital city by people who do not have your interests at all.
- _bxg1 7y agoIt's not hard to make the case that today's governments are tired and slipping and in need of reform. But there's no such thing as the libertarian fantasy of "lack" of governance. Human nature dictates that if there's a power vacuum, it will be filled. If it isn't filled carefully with a system designed to serve the people, it'll be filled by whoever can take it for themselves. And whether that's a feudal lord or Mark Zuckerberg, it will be worse than the alternative. It's nothing short of a miracle that for the past 150-200 years, we've managed to fill much of the world's power space with a system that roughly serves the people (with lots of flaws, but nevertheless). Let's hope it isn't just an anomaly.
- dsfyu404ed 7y ago> But there's no such thing as the libertarian fantasy of "lack" of governance. Human nature dictates that if there's a power vacuum, it will be filled. If it isn't filled carefully with a system designed to serve the people, it'll be filled by whoever can take it for themselves. Then let that power vacuum be filled on the state and local level. West Virginia and California should be free to run their societies into the ground (or not) in their own ways without the other telling them how to do it or being on the hook for the cost.
- vorpalhex 7y agoExcept people are not perfectly mobile and can't simply relocate across a continent. Should California be free to say, deny all brown eyed people access to public schooling? Or to run its economy into the ground and dissolve as a state? What about selling itself to a foreign power?
- conanbatt 7y agoWhats non-feudal about states in this conception?
- yumraj 7y agoWhat is even more terrifying is that this is being done by Facebook which has a person like Mark Zuckerberg, who has again and again shown that he has no moral compass and has complete disregard for people privacy rights and by extension other rights, as its dictator, with no real board oversight due to how stocks are structured.
- viscanti 7y ago> this is being done by Facebook which has a person like Mark Zuckerberg, who has again and again shown that he has no moral compass and has complete disregard for people privacy rights Sure. But think about all the money they can make from selling ads if they know everything that people buy. Doesn't he have a fiduciary responsibility to maximize shareholder value?
- api 7y agoThe prophecies of William Gibson continue to unfold. I'm waiting for the Rastafarian colony in high orbit.
- toyg 7y agoGibson, Sterling, and their friends, had the right hunch.
- mathnmusic 7y agoShouldn't Facebook be focusing on their previous project that promised to "connect the unconnected" (Internet.org / FreeBasics), rather than start another ambitious one "to bank the unbanked" ?
- UncleEntity 7y agoMethinks they can do more than one thing at a time, get everyone on the internets and facebanked using separate teams within the organization.
- kodz4 7y agoThere are lot of people connecting to the unbanked via facebook/whatsapp/insta and transacting with them financially off the network. When you have 1 network connecting 2 billion people why get off the network onto some other network to do a transaction. If I want to send cash to a family member in the developing world it's more convenient if the pay button is right there in the messaging app. As to privacy and Zuckerberg controlling everything, well the banks and telcos already have all my data and keep spamming me day and night based on that data. Whether the data gets centralized and the number of networks reduce to 1 is less interesting to me, than whether they use the data collected to take advantage of me. We do have road networks where you can drive from one end of the world to another without worrying about who the road owner is and how they might take advantage of you.
- uptown 7y agoZuck just wants to spend more time with your money.
- otabdeveloper4 7y agoNo. Your ideas of what 'feudalism' implies are totally wack and ahistorical. Feudalism was a time of laissez-faire, political liberty and anarchism. "The vassal of my vassal is not my vassal" was the motto of feudalism. It was a reaction against the centralization and coercion of the old Roman Empire. How is this anything like Facebook et al?
- _bxg1 7y agoWhat I meant is a civilization where only the powerful have a say, and regular people become serfs to powerful, warring organizations. Which, yeah, I guess isn't very well articulated by the word "feudal".
- zergblush 7y agoHe’s sketching out a main point that a few are subjugating the rest using some sort of apportioned rights (in this case, runaway technological inertia and money leading to a positive feedback loop of even more inertia) I think you’re missing the forest for the trees by concentrating on the historical robustness of his feudalism reference My immediate thought was that he meant something more like corporate city states ala cyberpunk themes presciented by blade runner and shadowrun
- ancientworldnow 7y agoWeird that someone who is trying to be such a pedant incorrectly suggests this was a period of anarchism (a political system centered the absolution of government and unjust hierarchies). Maybe you meant anarchy, which is also a stretch historically speaking.
- DiogenesKynikos 7y agoPeasants were bound to their lord's land, owed feudal dues like corvée, and could be judged and punished by their lord. It could only be called an era of "political liberty" for perhaps a relatively small class of nobility. The vast majority of the population was trapped in cemented, unalterable relations of fealty and economic exploitation. > It was a reaction against the centralization and coercion of the old Roman Empire. It wasn't so much a reaction against anything in the Roman Empire as the thing that sprang up as the more politically and economically advanced Roman system collapsed. Roman citizens had political rights, such as protection from arbitrary punishment, which were lost in the feudal era. The Roman state collected taxes and used them to provide substantial public goods, such as roads, aqueducts, sewage systems, public baths and theaters, the grain dole, courts and of course, defense of the frontiers against barbarian incursion. With the collapse of that system, the Latin-speaking population of Western Europe came under the rule of rather uncooth German tribesmen. The only honorable professions open to the Roman aristocracy, which previously would have gone into the civil service, were in the Church and the meagre administrations of the new German kingdoms. Taxation systems broke down, the previous public goods were no longer provided, and the common population came under the personal rule of their lords. I wouldn't call a system in which the common population is subjected to the personal rule of a lord more "free" than a system of laws.
- zxcb1 7y agoWhat happens to the data (and metadata), will all users be transparent to these corporations? Isn’t there a risk of this turning into a social credit system?