2014년 8월 28일 목요일

[발췌: B.Scott's] Riches beyond belief: ... (2013)

※ 발췌 (excerpts):

( ... ... )

The trouble is, while my experiences in mainstream finance taught me a lot about what the industry [financial sector] does, they only gave me glimpses into the nature of the mysterious stuff it does it with. The financial system exist, above all, to mediate flows of money, not to question what money is. Investment banks create financial instruments that steer money from one place to another, with built-in sub-conduits to siphon it backㅡextractive devices used by investors. To draw an analogy with computer coding, we might say that financial instruments are analogous to 'high-level' programming languages such as Java or Ruby: they let you string commands together in order to perform certain actions. ^You want to get resources from A to B over time? Well, we can program a financial instrument to do that for you.^

By contrast, money itself is more like a ^low-level^ programming language, very hard to see or to understand but closer to gritty reality. It's like your computer's machine code, interacting with the hardware: even the experts take it for granted. You might need to explain what a bond is, but nobody is ever 'taught' what money is. We just see it in action and learn how to use it. Indeed, the only way you ever tend to get a glimpse is in relief, by contrast with another programming languageㅡor when you're forced to build it again from scratch.

Most people never get this opportunity. If you had to ask the average persion in the financial industry to explain what money is, they'd probably rattle off the economic textbook description: 'a means of exchange, a unit of account, and store of value'. This is not a very helpful definition. How can a piece of paper ^store^ 10 pounds of value? What are pounds anyway? Money sounds like it's an ordinary noun, a self-contained object. If it is a physical object, it must be paper or metal or digits on a computer. And yet, very few of us think £5 note is ^merely^ a piece of paper: the same idea of £5 can be expressed in electronic or metal form, after all.

No, to delve deeper into the nature of exchange we need some first principles, and these take time to uncover. The best guides in this half-lit territory turn out to be not economists, but rather the loose bands of monetary mystics and iconoclasts who are developing strange new exchange technologies.  They are a scattered tribe, with elders including the likes of Bernard Lietaer, Ellen Brown  and Thomas Greco, sages passing on tips on how to breach the Monetary Matrix. I myself sitting in a pub in Stockwell, south London, with Matthew Slater, a nomadic developer of open-source currency systems, and discover that he no longer bothers with a bank account or a fixed address. 'Once you've broken through appearances,' he says, 'there's no going back.'


I was introduce to Slater by a common friend named Jem Bendell. The two of them met in an Indian hippy colony called Auroville in Tamil Nadu, and Bendell is now a professor of sustainability leadership at the University of Cumbria and an undercover monetary revolutionary. I have an enduring memory of a TED talk in which he ripped a banknote into pieces, trying to make the point that the paper itself doesn't have value. Everyone in the room winced, as if to say: 'You coul have given that to me!', but Bendell was getting at a powerful idea.

If money is an object, it must be an ^enchanted^ one, charged up with value by a subtle cultural process. Why else would anyone exchange a box of coffee for a rectangle of paper? Shopkeepers accept the paper because they believe that it has abstract valueㅡbecause, in return, they believe that ^others^ believe it, too. The value is circular, predicated on each person believing that others believe in it. You hand over your money and claim something from the shopkeeper, almost as if the coffee were owed to you. Then they take the claim that was previously yours and use it to claim something from someone else. We all trust each other to value moneyㅡbut this still means that every monetary transaction is a leap of faith. And faith has to be carefully maintained.

The idea that money rests on belief makes some people uncomfortable. There's a popular assumption that money emerged, in some dimly imagined past, out of barterㅡthat it was just a more precise means to make direct exchanges. Mainstream economists still trot out this explanation, although anthropologist such as David Graeber have shown that there is little evidence for it. It's a reassuring myth, one that obscures the deep difference between barter and monetary exchange. In the former, nothing is left unresolved and no faith is required. It's a closed circuit, a like-for-like swap. By contrast, money transactions are never closed; you pass on an abstract, faith-based claim in exchange for a tangible good. At any given moment, the economy consists of only a limited number of actual goods and services, which people attempt to claim with money. If there are too many claims floating about, then the underlying value allocated to each one must decrease. This is what we call inflation, and it is a source of permanent anxiety in monetary communities. Which brings us to our first major psychological lever for maintaining faith in money: how the money is created.

( ... ... )

But gold is no more intrinsically valuable than official government money. ( ... ) All it really has is beauty and scarcity, plus an ancient cultural link with the idea of currency. Gold reveals the basic tension in the textbook definition of moneyㅡthe idea that it can be both a store of value ^and^ a means of exchange. For the most part, when something is truly valuable in itself, people are disinclined to part with it (why swap rum for something else when you can just drink it?). The monetary enchantment appears to work best when its tokens merely ^appear^ valuable, while containing no true value. That's how you convince people both to accept them and to give them away, rather than consuming them.

And so the second trick to making money believable depends on how it appears. The British Museum is full of the kind of shiny trinkets ( ... )ㅡa whole aspirational structure imprinted into useless metals and cowrie shells. ( ... ) they are easy enough to keep and powerful people appear to collect them, which is good enough for most of us. Do such artefacts 'store' value? Of course not. That's just a socially sanctioned pretence, a pragmatic, covert, wink-wink, let;s-not-talk-about-this charade. Nevertheless, over time, the fantasy becomes such a deep habit that no one person can stand up and point out the absurdity of the situation. At that point, it's the dissidents who seem mad, while the people swapping useful goods for bits of metal, paper or meaningless electronic data look perfectly sane.

This gives us our third major psychological prop to the monetary faith: what are the sanctions for not using it? ( ... ... )

Still, as the government of Zimbabwe learnt the hard way, you cannot order people to believe in money if the underlying story isn't convincing enough. In 2008 ( ... ... )

Money is a complex cultural technology. Sometimes it breaks down, but that just gives us all the more reason to tinker with its blueprints. Each new system, though, will have its own psychological side effects and trade-offs. We know what mainstream currencies such as the US dollar are good for: overcoming barriers between buyers and sellers who don't particularly know or trust each other. The trouble is, by reducing the need for personal trust relationships, mainstream money encourages social atomisation, to the point where arms-length purchasing starts to seem like the only valid kind of transaction. ( ... ... )

The problem might be that mainstream money is simply too efficient. It numbs people into forgetting that it's socially pragmatic delusion, and so take it for granted, just as we take oxygen for granted. But oxygen is vital for our survival, whereas money is only an intermediary tool, cushioning us from the base-level economic production that actually sustain us. There's an ecological dimension to this, of course, which is my overriding concern. Our ability to exchange without knowing where things come from blinds us to the real core of the economy: not money, but the physical things we must wrench from the ground by human effort, which is underpinned by agricultural systems, and energised by sunlight, water and soil.

The more we abstract and fetishise money as a thing in itself, the more lose sight of its sources and its goals. We get confused, and feel disempowered relative to those who wield larger flows of it. Sealed off from inquiry in its hermetic shell, money distorts our perceptions of one another. We can't seem to remember that it is merely ^one^ means of exchange among many. What energies would we unleash if we were to break open that opaque shell and split the monetary atom?

I don't suggest that we start suspiciously eying the change handed back to us in shops. Coins are designed to be symbolic and abstract, and perhaps that's required. What we need though, is the right kind of doublethink, a carefully managed form of cognitive dissonance that allows us to see the centuries of real technological change that lie behind them, the oil and dirt and oceanic dragnets, the limestone blast furnaces and neon lighting systems and chemicals synthesised from fossilised trees. Perhaps we can tinker with the world 'money' itself. It's a mass noun, like you'd use for some kind of tangible substance, and it makes money sound like a 'thing-in-itself'. As a kind of mental discipline, I prefer to use a different word: COGAS. It stands for 'claims on goods and services', which is all money really is. And now I have a word that describes itself, as opposed to one that actively hides its own reality. It sounds trivial, but the linguistic process works a subtle psychological loop, referring money to the world outside itself. It's simple way to start peeling back the façade.

To go deeper, we need to start actually experimenting with alternatives. Money, we know, is a technology, and it can be designed for different purposesㅡalways for exchange, of course, but with auxiliary characteristics. To uncover and experience these characteristics, I actively play around with as many esoteric currencies as possible. ( ... ) Bitcoin, an electronic 'crypto-currency' that captured the public imagination earlier this year. It's a fascinating experiment, and one of the first alternative currencies to reach any significant scale without the help of legal backing.

( ... ) If doubt can destroy a currency, then a cultlike process of evangelical faith-building can create one.

Bitcoin has one very interesting attribute and, to understand it, we should look to the theoretical disagreement between the Enlightenment political philosophers Thomas Hobbes and Jean-Jacques Rousseau. Hobbes was a pessimist. In order to escape the 'war of all against all' that he believed was the natural state of human existence, he thought that individuals ought to submit to the will of a central sovereign who could act as arbitrator in disputes. We've traditionally associated this with political authoritarianism, but it also serves quite well as a description of mainstream money. Most of our money nowadays is electronic, 'stored' in an oligopoly of private banks that are themselves connected via a central bank. We rely on these institutions to keep an accurate score of our electronic money. Brett has £97, they say. Trust us, we have it recorded in our IT database.

Rousseau had the radical idea that Hobbes's arbitrator needn't be a single dictator or oligarchy. Instead, it could be the ^collective^, or the ^general will^. So it goes with Bitcoin. In place of a centralised, hierarchical group of banks keeping score of the money, a decentralised network of individuals records every transaction on a virtual ledger called blockchain. Brett has 3.8462 BTC, the network says. We've collectively kept score of that. In this scenario, my 'account balance' is less like the ruling of a sovereign and more like the result of a popular democratic vote, mediated via a computer network.

In normal, bank-mediated electronic transactions, someone tells their bank to send money to your bank and then the banks edit the buyer's and seller's account balances to reflect the transaction. It's a strange feeling, then, to accept an electronic payment with no banks involved, then pack a book into a parcel and write an address in America on it simply because someone announced to a network of strangers that they had paid me. The recording of the transaction in the cloud appears as nothing more than a series of numbers on my computer, yet there I am, putting the physical books in the post.

Why do I do it? I accept bitcoins for the same reason that I accept normal money. Mainstream money is used to replace a specific trust relationship with a general one. I take British pounds from a specific person because I trust that I can exchange those pounds for something else with the general British pound-using community. Likewise, I take the bitcoins from the specific buyer because I trust that the broader Bitcoin community will accept them from me in exchange for something of intrinsic value. The main departure from normal electronic money is that Bitcoin uses a decentralised network in place of a central hierarchy. The advantages are anonymity, a sense of freedom and, it has been argued, a more resilient system.

Indeed, Bitcoin has become especially popular with libertarian anarcho-capitalists because its supply is regulated, not by the government or the private banking oligarchy but by 'apolitical' mathematical protocols. Theoretically, anyone can make new ones, but it's a very time-consuming technical process and the operation can only be performed a finite number of times, a bit like gold mining. For this reason, bitcoins are naturally scarce. Inevitably, Bitcoin evangelists often fall into the trap of thinking that the value of their favoured currency must somehow be more 'real' than that of government-backed money, just like goldbugs do. In fact, all it means is that one form of monetary faith has replaced another.

If digital currencies such as Bitcoin attempt to spread exchange to a global level, local currencies aim to concentrate economic energy into a small space. My Brixton Pounds, and other local currencies, such as the Bristol Pound and the Toronto Dollar, are only redeemable within local neighbourhoods. Where Bitcoin seeks to attack the centralising tendency of a nation state, the Brixton Pound is a (gentle) attack on structures that undermine local community resilience.

Part of the essence of the Brixton Pound is its deliberate ^inconvenience^. We're used to thinking that absence of friction must be a virtue in any transaction, but a local economy thrives on inconvenience. Chance encounters in the street market help to bind a community together and give it richness of character. We lose all that when we opt for the robotic mediocrity of the automatic till and debit-card reader. It's fine balance, of course, and the Brixton Pound recently added a pay-by-text system that combines the ease of electronic payment with the richness of local exchange. I still have to hand-deliver the books I sell that wayㅡknocking on the door of a guy called Rico who writes a food blog, having a chat, getting to now someone I didn't know before. The inconvenience is where the connection comes in. Who knows? Maybe that apparently 'inefficient' method of hand-delivery could lead to a productive new relationship. ^Hey Rico, I need someone to cater an event, an help me out?^ Extreme efficiency of exchange, in other words, might come at the cost of developing new business contacts.

Then there's my friend Matthew Slater, who has developed an open-source software package that allows you to start a whole range of different currencies. Would you like it time-based, commodity-based, mutual credit, or fiat? His packages can do it all. It's like a Swiss army knife of options. In this, perhaps we can see one vision for the future of moneyㅡa future based on diversity, where we can move in and out of exchange technologies as we need. And perhaps only a handful of different monetary systems are required. Local currencies such as Brixton Pound are about localising, whereas digital currencies such as Bitcoin are about decentralising and internationalising. Meanwhile, so-called demurrage currenciesㅡdeliberately engineered to lose value over timeㅡare about energising the volume of transactions, as people have no incentive to hoard them. Freicoin, for example, is an attempt to create a demurrage version of Bitcoin, neutralising the hoarding impulse built into Bitcoin's psychological structure. Then there are timebanksㅡcommunity systems where people directly exchange labour time, which is about humanising and reconnecting exchange.

Increasing the diversity of monetary technologies doesn't only have the potential to create more resilient economies. It is also empowering. Perceiving a choice (especially when it is limited) is generally a good thing, leading to richer, more self-directed experience: ^I have chose to use this technology of exchange for this particular purpose^. The alternative is unconscious acceptance of a dominant monocultureㅡone that, even if it is stable, is psychological destructive (or, at the very best, dull).

( ... ... )

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