[ExI] Joule currency (Re: Banking, corporations, and rights)
eric at m056832107.syzygy.com
Fri Feb 25 18:18:16 UTC 2011
Kelly Anderson wrote (re: fractional reserve banking):
>I guess the real problem is understanding the alternatives. There just
>isn't enough physical gold to run the economy (unless gold were
>$1000000 an ounce or something... which would make the industrial use
>of gold prohibitive... which would have its own downsides)
I propose the Joule as the future unit of currency.
What you want is a money supply that grows along with your economy, so
you don't have deflation. Fractional reserve is supposed to provide
that growth, but it has the potential for abuse. Economists have been
thinking about "commodity bundle" currencies as a replacement for the
gold standard, but things would have to be moved into and out of the
bundle as technologies and needs change.
In essence, the Joule acts as a single commodity, just like gold.
Want to print more money? Go out and bring some energy production
online. Manufacturing, even distributed manufacturing by
nano-factories, requires energy. The cost of manufactured goods would
be the energy cost of creating them, plus some extra for the materials
and design. You can transform materials from one form to another, at
an energy cost. The higher energy forms would be more expensive.
Oil companies might like this, and be willing to back it. It
basically turns them into money printers. There might be a shift in
attitude though. "Hey wait! We're pumping money out of the ground,
then BURNING it?!" Ultimately, it should get people thinking about
renewable energy resources, maybe even funding solar power satellites.
There are some details to work out (in addition to the question of
transitioning to this). What would a banknote be? "SpacePowerCo will
redeem this note for 100,000 Joules of electric power delivered to
bearer over existing infrastructure." Power producers would issue
such notes at the rate at which they produce power, but the note is
for future power production. How far into the future are they allowed
to issue notes for? Perhaps the notes need a redemption time range.
Would you take a note for power you can only redeem in 10 years? They
could be issued to finance construction of new power sources.
I think we could scrap fractional reserve banking if we went to this
scheme, and avoid the incentive to inflate the currency. The banks,
of course, won't go for it.
Is this something worth thinking about?
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