Perspectives on wealth and the machine of money
We quote extensively from Bruce Sterling on more than one occasion within these pages. In part, it is because he has in abundance the one quality which was most lack in the antebellum – imagination. He has literally reinvented his career as a wordsmith in enough different venues to command respect for his written accomplishments alone, but he always brings a unique angle – speculative fiction, industrial design, party planning, and futurism – to the study of particular problems. His vision is a useful predictor of things to come, although even he acknowledges the challenges of that profession.His latest piece, for Forbes, is a treatise on the futures of money.
This is also something another of our favorites addressed. To quote once again from Proteus,
For us, the questions are not whether a global economy will or will not continue or whether the poor will always be with us. Rather, the central questions were:
- What will people value in the future? For in Wealth, there is much Power - anciently and in the future.
- How will Wealth work in the future? Before Croesus, barter was the method, and goods were independently valuable. After Croesus, money itself filled both roles. We were looking for the possibility of similar revolutions.
At length, we found evidence of broad change afoot. Across all of the scenarios, we saw that money will still be valued in the future. However, in the press of environmental, social, spiritual, and cultural concerns manifested in what we called Herds, people increasingly will come to place very high value on less fungible assets, such as knowledge, safety, health, personal networks, and privacy. These new "currencies" and the interrelationships that lead to their acquisition will be more vulnerable to manipulation than money. To some degree, we witnessed the undoing of Croesus' coup: in our futures, things that are valued highly are less easily standardized.
We also saw that significant threats to national well-being will emerge from shifts in the global economy. These threats might result from deliberate "attacks" or they could be spawned by the confluence of myriad economic decisions that are, in turn, based on highly complex interactions and-importantly-transaction flows.
Because opportunities and threats emerge from new or unexpected sources of Wealth, it is vital to understand the new forms of economic value creation. In several of our workshops, the participants undertook successful, rudimentary efforts to define models for next-age economic value creation. This effort led us to believe that a more concerted expert-level experiment workshop might bear fruit in the near term.
We have seen a number of non-currency forms of wealth in the market of attention of which the blogsphere is a part; and as a result a number of related debates have emerged regarding the state of that market. Like any other economy, there is competition and uncertainty.
The defining standard which set the reference for emerging digital currency was ironically also laid out by another of the post-cyberpunk speculative fiction authors, Neal Stephenson, in his work Cryptonomicon. Always a recommended read for the accessible manner in which his thoughts are presented, we have seen the very thing he envisioned come to light. However, in the real world it became a much more mundane application – the creation of a virtual currency not for “Atomizing society. Making the world safe for drug traffickers and Third-World kleptocrats" but rather as part of a game.
And the success of that virtual currency, used in a fictional world but traded for actual dollars, was so stunning that early estimates indicated economic activity on the scale of Russia’s GNP and an exchange rate nearly equal to the Japanese yen. This research led to an entire specialization of academic disciplines, one that we still follow with some interest because of its value as a micro-scale model for the issue as a whole. For the first virtual world’s currency has spawned imitators both in other games and for other purposes. Its value in aggregating wealth to specific purpose is only now emerging, and it also parallels the astounding growth of alternative online remittance services.
These are challenges not even the financial community is prepared to deal with. The services themselves are emerging and will disrupt traditional business models so profoundly that even the giants of the traditional anti-money laundering world will be hard pressed to adapt. In the end, it is more than likely that the global scale of black money – virtual or otherwise – is simply so much higher than any previous estimate that it may likely overwhelm traditional analysis.
It is a daunting gauntlet cast down before us.