Comment author: skilesare 19 August 2015 06:53:07PM 1 point [-]

Does anyone here have kids in school and if so how did you go about picking their school? Where is the best place to get a scientifically based 'rational' education.

I'm in Houston and the public schools are a non-starter. We could move to a better area with better schools but my mortgage would increase 4x. Instead we send our kids to private school and most in the area are Christian schools. In a recent visit with my schools principal we were told in glowing terms about how all their activities this year would be tied back to Egypt and the stories of Egypt in the old testament. I thought to my self that I didn't even think that Moses was a real person so this is going to get very interesting.

I wish they'd spend half as much time on studying science and psychological concepts that they do studying the bible...but what are you going to do?

Any ideas?

I should add that I did graduate from this same school although I did not go through grades 1-9 there...only high school, and that education was really top notch...but still an hour a day of bible class.

Comment author: MaximumLiberty 26 April 2015 08:58:31PM 0 points [-]

This seems to me that it significantly raises transaction costs without significantly creating benefits. The value paid in cash in our real economy today will be equal to the sum of the cash payment plus the net present value of risk-discounted future payments in your model. That means that there is zero benefit to the parties involved, but introduces a transfer of risk, and increases the complexity of the transaction.

The place the rubber hits the road on this problem is that companies who would receive payment under this approach will not sign up to a system that causes their holdings of cash in the system to decay, if there are other alternatives. You can compare this to inflation in, say, US dollar holdings. The difference is that the US dollar is already widely accepted. It does not have a problem convincing people to accept it. Your system will.

Historically, one of the features that made any commodity more likely to become a currency was that it would not decay. For example, precious metals typically won out over comparably divisible commodities like grain because metals don't rot after a year or so. A currency that rots doesn't seem like a winner.

Comment author: skilesare 26 May 2015 03:19:43PM 0 points [-]

Sorry for the delayed reply.

This system significantly reduces risk. It is one of its biggest benefits. Have you tried doing an NPV calculation with 0 risk?

Risk is reduced by folding the blockchain over delinquent entities so that you still procure some future benefit from investors/customers.

I agree though, the benefits must out weigh the negatives...and I think they do. The hard part is convincing businesses that they have more to gain by using the system...or rather that they will be out competed if they don't use the system.

Comment author: Slider 22 April 2015 02:53:48AM 0 points [-]

Even if the amount of "stock" is the same constant for everybody there is still a decision how big a portion it should represent. In the extreme the only stocks are from the $1 in 1 stock out principle. But in a way the enterpreneur should also have stock in it. If the enterpreneur reserves 1000 stocks for himself that would be the equivalent of a 100 stock person giving out 10 stocks per $. If the starter doesn't have any stock he doesn't own it he just operates it for the customer-owners.

Comment author: skilesare 22 April 2015 04:29:06PM 3 points [-]

Ahh...I see...The 'stock' that consumers get in hypercapitalism isn't a stock of ownership or voting stock. It is a kind of non-voting prefered stock. Really it is more like an airline mile. It doesn't affect what dividends are paid or the cap table.

Comment author: Letharis 22 April 2015 01:34:37AM 2 points [-]

When you talk about perfectly competitive markets having no profit, you're probably thinking of the term "economic profit". The sort of profit everyone usually thinks of is revenue minus cost, which is called accounting profit by economists so as to distinguish it from economic profit. Also economists are really bad at naming things. Economic profit is revenue-costs-opportunity costs.

In perfect competition, firms do make accounting profit, but they don't make economic profit.

Thanks for posting your model here and getting involved in the discussion. It's always good to be able to discuss these things publicly because I'm sure many people are learning a lot from it.

Comment author: skilesare 22 April 2015 02:29:07AM 3 points [-]

..and I'm all for profit. I think it is a great thing....I just also think there is an advantage to it being a time bound great thing. You made a profit! Awesome! Good for you! Now use it for the greater good or give it back(slowly...but still...)

Comment author: SilentCal 21 April 2015 05:17:11PM *  7 points [-]

But you can also write the opposite parable:

Crusoe has finished planting his most fertile fields and is preparing to plant his remaining seed in the less fertile adjoining land when the stranger arrives.

S: I have found some excellent fields, too far from your home here to be of any use to you, but which will serve me well; and I need only some seed. I see you have some excess, which will be much more productive in my fields than in yours; might I borrow it, and easily repay after harvest?

RC: How much seed will you repay me, for each I lend you now?

S: One seed for each; my religion would forbid any other arrangement.

RC: The land I intend to plant them in is not so lush, but even so I expect to reap many times the seed I plant. Where is my self-interest in placing it where it will yield less?

Moral: some goods decay, but others can compound themselves--or, more often, create other goods that can create other goods in a long chain that ends with more of the first good.

The role of money is to make such long chains implicit; a positive real interest rate reflects that such chains are possible for most goods, and any exceptions will increase in price faster than interest accumulates.

Comment author: skilesare 22 April 2015 02:26:50AM 2 points [-]

I love your counter-parable. It does an awesome job of showing what massively complicated thing we are discussing. Land, money, consumables, exponentionables(your seeds), all have very different characteristics and drivers. Interest, investment, production, savings all are slightly different ways of talking about some of the same concepts.

I'm trying to get to the bottom of this statement and am having some issues:

The role of money is to make such long chains implicit; a positive real interest rate reflects that such chains are possible for most goods, and any exceptions will increase in price faster than interest accumulates.

Could you unpack it some more?

You can correct me where I'm wrong, but I think what you are getting at is that the current abstraction of money and the idea of interest paid for borrowing it is optimal enough to reward the people that put up the cash for the value that it creates? And if a good isn't one of those exponential type things, the price just keeps going up faster than the interest rate because of its implicit limitedness?

Do you think RC would be more willing to make the more productive choice if he could benefit from all of the upside that lending the seeds produces or only the amount that is agreed upon? I think what I'm trying to get at with hypercapitalism is that we want RC to seek out the best use today instead of the best use tomorrow because if he waits until tomorrow all the work that could have happened to day can never be redone.

Comment author: Lumifer 21 April 2015 07:01:46PM *  0 points [-]

As an aside: the local prefix for quoting is ">" at the start of the line, not the pipe character.

I think you do, you just don't know it yet :) Your choice would be between more than what you get now or way more than you get now.

I think you're mistaken about my preferences.

You point out yourself that money is (in this context) is just a measure, an medium of exchange. It is NOT the same thing as the underlying value. Now, to "get more" I would want to get more value and you're promising me just more money. The point is that an economy produces some amount of value and that's all you have to redistribute. You can make money spin faster, but that will not increase the value produced -- all you'll do is increase inflation.

Essentially, if I buy a loaf of bread from a baker and the baker knows he'll have to pay me "dividends" in the future, the baker will raise the price of bread to compensate for these future dividends. Your hopes remind me of "free energy" mechanisms in physics -- if only we could set up sufficiently clever loops we can get more energy that we put in! Um...

My current understanding of your idea is that you basically want a tax on wealth (or, specifically, on money wealth) with a very complicated scheme to distribute its proceeds directly to the population bypassing the government. Is that a reasonable approach?

I would also like to point out that I think your fears of wealth accumulation are overblown. Look at empirical data. Is there, in reality, old old money dominating everything? Does the Medici family rule Europe? What happened to the Vanderbilts? The oldest rich family I can recall offhand is the Rothschilds and while they are not poor by any means, how do they do compared to Gates or Brin or Musk?

All those things are subject to entropy and have a natural carrying cost.

What about the traditionally most valuable kind of capital -- land, also known as real estate? What about technology? or non-agricultural commodities like oil, coal, copper, etc?

controlled inflation(demurrage) is better than the random inflation we deal with now.

The current inflation is controlled to best of central banks' abilities. You are not controlling it any better, you're just setting a floor as to how low can it go.

As good a value as a $1 shirt made by a robot down the block?

I'll take the standard capitalist approach -- if the robot down the block can sell me the same shirt cheaper, I'll buy it from the robot. If it can't, I'll buy it from the Vietnamese. I am not willing to pay extra for feel-good fluff.

Comment author: skilesare 22 April 2015 02:11:30AM 0 points [-]

You point out yourself that money is (in this context) is just a measure, an medium of exchange. It is NOT the same thing as the underlying value. Now, to "get more" I would want to get more value and you're promising me just more money. The point is that an economy produces some amount of value and that's all you have to redistribute. You can make money spin faster, but that will not increase the value produced -- all you'll do is increase inflation.

Do you think that the current economy is ginning at an optimal output? How much slack would you guess there is? How much GDP is currently left 'on the shelf'? Maybe you think we are very close to optimal. If that is the case then I'm tilting at windmills. If it is suboptimal, the the next questions is 'why?' Is it a lack of tech. A lack of resources? A lack of time? I'm not sure but I think it is very sub optimal.

If increasing the flow of money would not bridge the missing value, what would? I think that a lot of actors in our economy get stuck 'waiting for the check' to get started on production, finish production,procure the capital necessary to build, etc.

Is there some data/study you can point to that says that faster velocity doesn't increase production? Maybe I should run the model with mv > 1 transaction a month and see what happens.

Essentially, if I buy a loaf of bread from a baker and the baker knows he'll have to pay me "dividends" in the future, the baker will raise the price of bread to compensate for these future dividends. Your hopes remind me of "free energy" mechanisms in physics -- if only we could set up sufficiently clever loops we can get more energy that we put in! Um...

The difference is that there isn't a law of conservation of value. We regularly see massive exponential movements in the ability of human beings to produce amazing things. Would you argue that we should go back to barter because money is just a clever way of abstracting away coincidence of wants? Energy is physics. Money is an artificial construct.

Also don't ignore the fact that a consumer may be willing to pay the increased price charged because the consumer will be getting that value back in the future. I understand that this may seem like a clever loop, except that people die. So the loop breaks down and you have to have a system for legacy. The system has a consequence of corporate death as well so you don't end up with supercorps sucking in all the economic decay. Legacy and transition are in the details of the book, but basically, this isn't a system that jives with immortality...it is a system to get us there.

My current understanding of your idea is that you basically want a tax on wealth (or, specifically, on money wealth) with a very complicated scheme to distribute its proceeds directly to the population bypassing the government. Is that a reasonable approach?

It isn't really much more complicated than the fractional reserve system we have now. I have no delusions about the ease of bootstrapping such a system, but it really can be a fairly straight forward and simple system.

I would also like to point out that I think your fears of wealth accumulation are overblown. Look at empirical data. Is there, in reality, old old money dominating everything? Does the Medici family rule Europe? What happened to the Vanderbilts? The oldest rich family I can recall offhand is the Rothschilds and while they are not poor by any means, how do they do compared to Gates or Brin or Musk?

I think the empirical data is there for the r > g problem(http://www.amazon.com/Capital-Twenty-First-Century-Thomas-Piketty/dp/067443000X/r). I think most of use here probably fall on the side that assumes technology will keep g > r, but with no promises, I think doing something is better than nothing.

What about the traditionally most valuable kind of capital -- land, also known as real estate? What about technology? or non-agricultural commodities like oil, coal, copper, etc?

Certainly somethings have more or less carrying costs. The closer you get to stable elements, the more you can decrease these (Gold, Silver). Carbon is an element but tends to be a slippery beast that takes all kind of crazy forms that break down or change in some way. Land does have a carrying cost of some form of maintenance and most has an artificial carrying cost in the form of property taxes. Gesell had some pretty crazy ideas about land that I don't exactly buy into. I don't have many super strong ideas about it because I think(hope) we are going to be moving past the point where land is that big of a deal for most of us.

The current inflation is controlled to best of central banks' abilities. You are not controlling it any better, you're just setting a floor as to how low can it go.

Actually the theory is that we can hold inflation at 0 by printing decaying dollars when we need them and decaying them faster when there is too much. Tech is always going to bring about some deflation, but the general goal is for there always to be enough money to buy all the things that are being produced.

I'll take the standard capitalist approach -- if the robot down the block can sell me the same shirt cheaper, I'll buy it from the robot. If it can't, I'll buy it from the Vietnamese. I am not willing to pay extra for feel-good fluff.

I'm a humanist...I guess you are not...agree to disagree? We can't do that on a rationality discussion board can we? If you aren't willing to pay for the feel good fluff, do you at least want it to happen? By what means if so. If not, are you cool with the status quo going forward as long as prices always get smaller?

Comment author: SilentCal 21 April 2015 06:01:23PM 1 point [-]

Yes, I mean that B could charge a lower price, and 'capitalist reason' would dictate buying the apple from B. I'd urge you not to conflate externalities with future value; there are many reasons one producer could have a higher future value than another, and they aren't all socially beneficial. For instance, farmer B might be an excellent and responsible farmer who's about to retire. Or maybe farmer A uses slave labor and is smart enough to never get caught.

Re: static rent, I meant in your code, not in the idea of hypercapitalism; each node is given pER at the beginning and it doesn't change. Having some kind of time-varying pER that buyers can predict, together with having higher pER nodes charge lower prices, would start to get at the difference between capitalist and hypercapitalist reason, but that starts to get complicated, and I'd have to think a while longer to conclude that it doesn't need even more complexity to make sense. (I've had other thoughts on how to improve your code, but they keep exploding into endless chains of 'but if you add this, then you have to add that')

And when I questioned if future-value-based buying was 'desirable', I meant for society. Take the example of the retiring farmer; 'capitalist reason' would say to buy from them iff they sell the best-priced apple, whereas hypercapitalist reason would penalize them for their lack of future value.

Also, random thought: it'd be cool to add utility measures. I'd suggest utility per node per month as log(spending/necessities).

Comment author: skilesare 22 April 2015 01:29:00AM *  3 points [-]

Here is a video where I present a more 'real world' scenario. And I mean real world in the loosest sense. In it there are 3 actors that all have their role to play and the fallout is interesting.

https://vimeo.com/user17783424/review/115279592/1bb88f885d

Ultimately It would be cool to build a super detailed economic mode. I also think it would be cool to hook it up to something like World of Warcraft.

I do need to do a better job of 'thinking evil' because we all know there will be people that try to break the system and use its weakness for gain. The retiring farmer issue is a real problem and I've tried to balance it with a loyalty that mirrors what we see in our human life cycles. It is rarely optimal for the 55 year old man to stay with the wife of his youth once she hits menopause and he is still fertile, but we see it all the time...and there is usually something awesome and beautiful about it. Someone who grew up drinking Coke II will stick with it when Coke III comes along because....well nostalgia, loyalty, familiarity. At least that is the theory to be tested.

Comment author: CellBioGuy 22 April 2015 12:18:51AM 0 points [-]

What happens in a steady-state or shrinking economy as opposed to an expanding one?

Comment author: skilesare 22 April 2015 01:17:47AM 3 points [-]

Increase the decay rate and people move money faster and more cash comes out of the economy which keeps deflation from happening.

Things are ok if the economy recovers. In the event of a near extinction event we'll have bigger problems.

Comment author: SilentCal 21 April 2015 05:17:11PM *  7 points [-]

But you can also write the opposite parable:

Crusoe has finished planting his most fertile fields and is preparing to plant his remaining seed in the less fertile adjoining land when the stranger arrives.

S: I have found some excellent fields, too far from your home here to be of any use to you, but which will serve me well; and I need only some seed. I see you have some excess, which will be much more productive in my fields than in yours; might I borrow it, and easily repay after harvest?

RC: How much seed will you repay me, for each I lend you now?

S: One seed for each; my religion would forbid any other arrangement.

RC: The land I intend to plant them in is not so lush, but even so I expect to reap many times the seed I plant. Where is my self-interest in placing it where it will yield less?

Moral: some goods decay, but others can compound themselves--or, more often, create other goods that can create other goods in a long chain that ends with more of the first good.

The role of money is to make such long chains implicit; a positive real interest rate reflects that such chains are possible for most goods, and any exceptions will increase in price faster than interest accumulates.

Comment author: skilesare 22 April 2015 01:15:21AM 6 points [-]

This is a great comment and I've been thinking about it for most of the day. Just wanted to let you know I'm thinking on it and will respond in a bit.

Comment author: SilentCal 21 April 2015 04:11:20PM 0 points [-]

I don't think your model gets to the important differences between hyper and normal capitalism. In normal capitalism, people buy from the company that offers them the best deal on the present transaction, whereas in hypercapitalism they're going to buy based on both the present deal and the value of prefs. As I understand it, your model has no concept of present deal, as all rent (in your terms) is captured by the producer.

You could patch this by e.g. splitting the rent between consumer and producer to simulate the producer lowering prices to attract business. But since rent rates are static, the producers offering the best deals will be the same as those with the highest future value. So hypercapitalism wouldn't change the incentives, and even redistribution with reason would be plausible.

tl;dr I'm skeptical that consumers buying based on future value is desirable, and this model doesn't address that.

Comment author: skilesare 21 April 2015 05:27:46PM 3 points [-]

Can you explain more? Currently I don't care where an apple came from as long as two apples are the same to my perception. If I have a known reason why apple A is made in a more responsible way than apple B, I have no real incentive other than guilt to guy A over B. Under hypercapitalism you would favor A. Now B could lower their price...is that your concern?

I'm not sure where the assumption that rent rates are static comes from. Economic rent just is. It can vary all over the place. if someone comes up with a magic brain cancer pill that can only be used once, the rent extracted for that pill will likely be massive. In a perfect market for table salt, rents are going to be very very small.

As far as the model goes....I don't really have a model of actual capital and commodity products. That should probably be in the next model and it should probably include some form of competition simulation.

I'm skeptical that consumers buying based on future value is desirable, and this model doesn't address that.

Your correct...I make an assumption that if you had the chance to buy a gallon of milk and get nothing in the future vs buy a gallon of milk and get some of your money back in the future that you will almost always choose the second. A lot of people invest in Index funds even though they don't know what is actually happening inside them. I think some people will pay more attention than others, but on net, more attention will be paid and that is the goal.

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