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The Future of Money
Snuggums writes "Apparently some major forces at play in the tech money world. People like Vint Cerf, Tim O'Reilly, Andre Durand, and Cory Doctorow are teaming up with Tom Frey and the futurist think tank, DaVinci Institute, to dive into the forces at play with a Future of Money Summit later this year. They've even tapped a Nobel Prize winner and Visa founder, Dee Hock. They're hoping to answer questions like; what kind of money you'll be putting into vending machines 25 years from now; when will cash disappear; when will our current banking system become obsolete; and who gets to own money in the future?"
"Apparently some major forces at play in the tech money world."
Apparently some english majors at play in the Slashdot world.
...walk around saying, "Dude, I am so money"?
I'll form my OWN solar system! With blackjack! And hookers!
$995 per person before April 15, 2003
$1,195 after April 15, 2003 up to the day of the event.
That's not the future of my money.
Dont you know that cash is unpatriotic? Please refrain from using it anymore. Make everything electronic so we have an excellent paper trail to ensure domestic security and civility. What you don't like it? You must be one of them...
at my apt. complex they installed new washer and dryers w/cash card readers. I find it slightly inconvienient b/c I have to goto the main building to fill the card w/cash (but it does take credit card and debit). Other than that, it is slightly easier b/c I don't have to store $15 in quarters for laundry day.
I stopped using cash about 3 years ago. I keep two checking accounts and one savings account. I have a seperate check card for the second checking account and I transfer money to it for purchases (even at the grocery store just incase someone hits and extra zero and empties my account).
Once Wendy's and drug dealers take CC's I am set.
Ill be happy. Or would you be comfortable paying by credit card for a copy of 2600? How long before ashcroft starts checking up on those "obvious" criminals.
All Troll + "offtopic" mods are meta moderated as "Unfair", because you abused the system.
Why does it still take 5 damned days for a transaction to "clear" when I move money from one account to another? Has anyone actually ever challenged any banks/building societies to justify this delay?
Code, Hardware, stuff like that.
"In-depth conference where thought leaders will debate cutting edge changes and visionary thinking in the world of money"
... but my mind wants to see "loss leaders" ....
- Future of Money Summit
It says "thought leaders"
-kgj
Money is not just money. There's a whole fucking market behind it.
Have any of you gone shopping for things when you have no paper money on you? It's so much easier to write a check, swipe a credit card, even a debit card. If paper money is eliminated, sure it's less to deal with, but I think people will start spending their cash and draining their savings. Just look at credit cards. Before credit cards, credit problems didn't exist. You could only spend the money you actually had. Now, if they eliminate paper money in exchange for cards storing credits, people will just draing their cards so fast without thinking. They'll put more on them, then drain them again. It's great for the economy, but do you think we're really ready for this kind of responsibility? The amount of credit card debt says no.
Where does this Slashdot obsession with a cashless/e-gold/alternative currency come from?
Money has been around for 3200 years. Trade "I'll give you 2 sheep for one cow" has been around for thousands more.
I remember hearing these "cashless society" arguments in 1980. I look in my wallet 23 years later, and I still have a wad of cash in there, along with a credit card and ATM card. Sure, much of my purchasing is electronic, but it's far from cashless.
Now people are again saying "We'll be a cashless society in 25 years", and I still don't believe them. I've heard it before.
It reminds me of the "computers will solve all your paperwork problems. We will be a paperless society in 25 years." Cash is not going away anytime soon just because some money-geeks think they found an alternative.
As Ivanova from Babylon 5 said:
"Every time somebody says we're coming into a paperless society, I get 10 more forms to fill out."
"Can of worms? The can is open... the worms are everywhere."
More to the point who gets to decide when to increase or decrease the money supply. Your use of the word valuables in this context appears to refer to the notion that money needs to be backed by something like gold. It doesn't.
the problem with credit cards today is that people under 18 cannot have their own. How can we instill hardworking qualities in our young people while denying them the right to use their money as they choose?
what kind of money you'll be putting into vending machines 25 years from now
I already rely on cash only as much as absolutely necessary. With a debit card, I can pay for any credit card transaction directly out of my checking account, and more and more places are accepting credit cards every day. Hell, in bigger cities, you can even use a credit card in places like a Jack in the Box drive thru. In 25 years it'll be even more pervasive.
Some places now are even supporting debit cards directly and require me to enter my PIN... all the better, that extra layer of security is a little comforting. If my card is ever stolen though, I'm limited in liability to $50, thanks to credit card laws that apply even though it technically isn't a credit card, and I keep a little nest egg tucked away in an unrelated account to tide me over while the bank tracks down and fixes any unauthorized use of my main account.
Sure, it's not exactly a model of privacy since every purchase I make is logged on my account, but I consider the security of my money more important as a real issue than the nebulous fear that someone, somewhere is going to exploit the fact that I like buying cheeseburgers for lunch.
NO CARRIER
A rule where I worked was we'd all go out to eat lunch as a group but you had to have cash for your part because there is nothing worse than a table of 6 people all paying with debit cards. See your server in an hour.
A manager would rip you a new one if you constantly paid with a CC/debit card.
hackwrench: "the gold standard was generally a bad idea, keeping gold from other purposes."
I think you meant to say that the gold standard was generally a good idea, keeping politicians from manipulating the value of money. Other than that, thanks for the link.
http://www.futureofmoneysummit.com/advisoryboard.p hp
E-money is the ultimate form of Fiat if you ask me. All fiat has a history of corruption and collapse (the american dollar and other world currencies are heading that way as well). Fiat money is the money of the statist, since it allows those in charge of the press to create as much money as they need, while dilluting what the rest of us hold.
The question isn't "what form will money be in", the question should be "what assets will back our money". I don't care if its in the form of rice crispies, as long as it is backed by an asset (gold, food, land, space rocks) and has real value.
Credit cards cost even more than debits - you just pay a different way. The fee for using a credit card is 3% MINIMUM, and only a large retailer can get that rate. For small businesses it's more like 10%! That goes directly into the prices you pay.
The only reason more people aren't aware of this is that government has been in the pocket of the credit card companies for a long time - that's why it's illegal for the retailer to actually put the amount you're paying to Visa or Mastercard on the bill, where it belongs. Some have gotten around that by offering a "cash discount", but it's a legal grey area.
Credit card companies are the worst of finance industry, and that's really saying something.
There's overhead to maintaining a cash system too, of course, borne by the government that prints the cash (and polices counterfeiting, etc). But I really wonder how much extra we'll be paying in assorted "service charges" with every new electronic-cash scheme that comes along. If it's coming from banks and other financial empires, you can assume you're being bilked, because the only reason they ever have to offer a new service is to find a new way to skim your money.
People complain about paying taxes all the time; what I object to is bank charges. And the "take your business elsewhere" is ridiculous - they're all the same (even credit unions are only marginally better these days).
It's worth reading Dee Hock's writings. He sounds like a collectivist nutcase at first. But this is the guy who designed how Visa, the organization, works. He got all the big banks to sign on. And he was a mid-level guy at a small bank when he did it.
Few people outside the banking industry understand what Visa really is, let alone how it's organized and governed. Internet people should. It's a good model for shared infrastructure, like Internet backbones.
Visa is a major corporation organized as a cooperative. Its members, and owners, are banks. Visa sets standards and runs the backbone network that transfers credit card transactions between banks. Visa doesn't issue credit cards or do financial transactions itself.
The details of how that works politically are complex. Yet it does work, and a lot better than, say, ICANN. I'm not going into how it's done; read Dee Hock's book.
Here's a reference which says the rumor is true.
And I tend to believe Snopes.
"Can of worms? The can is open... the worms are everywhere."
I hope all of you /.ers see the consequences here. Firstly without cash the govt will know eveything you buy and when you buy it.
Also all of a sudden all of these banks and other get a peice of your money for the 'convience' of not using cash.. and then when it catches on they will charge you for the privilidge of using cash. If you recall, when ATMs first came out they were all free to use because it saved the banks money as oposed to have everyone seeing bank tellers. Then they started to charge you to use the bank tellers because it cost them more then if you used the ATM. Then they charge you to use the ATM as a convience fee.
So you are going to be charged a fee to replace your card that has an intentional limited life span, you will be charged to transfer funds to it, you will be charged an electronic transaction fee when you use it. Its like an infinite infusion of middlemen.
The main thing people don't understand about "human nature" is that there's no such thing as human nature.
Humans have evolved to be flexible; in fact, human bodies and brains evolved in concert with human societies. That's why people can adapt to live in a highly socialist system, or a highly capitalist one, or any of a million other alternatives.
What you seem to be calling human nature is a self-fulfilling prophecy. Create an economic system that depends entirely on the pursuit of self-interest, and people will behave in self-interested ways. Create one where people work together, and they'll work together. Pretty obvious really.
Socialist systems have all sorts of problems, but exploitation by the selfish or lazy rather notably isn't one of them, precisely because that sort of behaviour isn't fostered. Capitalist systems have a whole other set of problems, many of which are related to selfish behaviour, because that's the basis of the whole system.
There's ample room for criticism of any system, but to think you can live immersed in one world and be able to reasonably comment on the people and workings in another is absurd. Go live in Sweden for a few years and your point of view might be worth listening to. You'll certainly have a better conception of "human nature".
I just like a paperless bathroom, it only works for the Japanese.
Banaaaana!
You are incorrect in associating paper with wealth. There is no connection. That dollar bill in your wallet is no more or less money than a digit in a Wells Fargo computer. Both represent a unit of confidence in the issuing body - the US government. That is all they represent. You cannot redeem that dollar bill for a fraction of preciou metal. You cannot redeem the bill for a piece of a brick of a government building. You are not assured of receiving a set unit of a foreign currency for it either. It is a fiat currency. It has no inherent value. The paper bill is simply a physical container for a fractional unit of confidence in the US government, nothing more or less.
What you are referring to is the growth in the money supply through the Fed down to the fractional reserve banks. M3 money has grown by leaps and bounds in the Greenspan era. This and only this is the source of the stock market bubble.
Or, alternatively, when phone/telecommunications systems go down. Anyone who was in Manhattan on September 11th and the days immediately following will probably recall that many stores had either ceased accepting cards at all, or had set up special lines because only a few of their readers were working. This was due to the incredible call volumes that were jamming up the city's relatively limited numbers of long-distance circuits.
Fortunately, most of the ATMs were up and running (though a few had run out of cash, because so many people were using them where previously they'd just relied on their check/credit cards.)
I love my check card, but I'm pretty sure it won't be there for me on that occasion when I most desperately need it.
The existing banking system will continue ad infinitium because there's too much money to be made the way things are now. Noone would ever propose something different because they can already quantify the amount of money they make now. There would be too much risk in something different.
Gorkman
If you want to know what's next just do some traveling. Anyplace but here in the USA you will find debit cards and such everywhere.
So why not here? Because the banks here are making a nice 3-5% on EVERYTHING we do, usually paid by the merchant. It's a 3% tax right into the banks pocket.
Don't expect to see any of these futuristic (meaning 20 years ago everyplace else) technologies in the US anytime soon. Powerful rich people will not give up their $300B yearly drain on our wallets easily.
- Adam L. Beberg - The Cosm Project - http://www.mithral.com/
We here in New Zealand have had a great system that has been in use for many years now called EFTPOS. You can use you banks cash card ANYWHERE.
:)
Even some of the local flea market stalls have this available.
I hardly carry physical cash on me any more and I know a lot of other people out there are starting to do this.
Even the banks are supporting this by making new bank accounts with lower fees if you do everything electronically.
People visiting us from overseas love this system and find it hard going back
This is the future of money.
I'm sure I'm not the only one here who has has a debit or credit card no longer be able to be read by the machine at the till after a bit of wear and tear. What happens when your cash card with your life savings on it can't be read anymore?
Michael was referring to Robert Mundell, who sits on the summit's advisoryboard and won the 1999 Bank of Sweden Price for Economic sciences in Memory of Alfred Nobel. Often Mistaken for a Nobel Prize, because the Nobel Foundation disingenuously treats it as such in their announcements and on their web site, this award has nothing whatsoever to do with Alfred Nobel, his endowment or his vision. The award is totally politicized, disproportionately awarded to the U of Chicago school, and frequently goes to fringe cranks like Ronald Coase.
The great economist Gunnar Myrdal, who sat on the board of the Bank of Sweden, argued for the prize's abolition. In 1974 Myrdal shared the award with Freidrich Hayek. Basically, Myrdal felt that if ideologue hacks like Freidman and Hayek won the prize it was meaningless.
Nothing against Mundell, but that prize is a load of crap.
It is cowardly, and a betrayal of whatever it means to be a Jew, to act as a white man
-James Baldwin
These conferences are primarily interesting because of the people that attend them, yet by pricing their conferences like that they are virtually guaranteeing that the only people who turn up are Sun and Microsoft's [insert conference buzzword here] evangelists, and a bunch of journalists.
Speaking as someone who has been cashless for the past 3 weeks (too lazy to go to the ATM, plenty of cash in my checking account), a plastic life ins't too horrible. My primary complaint is with 2 aspects:
1) Slow bandwidth. Sometimes those who accept credit/debit cards use dial-up modems to authenticate. This causes me a few extra minutes in the checkout line and a few dirty looks from the people in line behind me. I visited a Home Depot today (for phone line punch-down baords, if you must know) and their system was lightening-quick. Every quicker than cash. With $40/mo. DSL lines, makes you wonder why the rest of businesses haven't signed up.
2) Lack of credit/debit card support. I want all my cabs to support this. I want fast-food restaurants to support this. Everytime I buy something, I should be able to swipe. (I understand the cab/wireless dilemma, but why doesn't Wendy's have swipe stalls at the drive-thru?)
We are 90% there in terms of economical technology. But there is still a sort of stigma associated with using a piece of plastic to buy things. Like you can't afford it. Why is this?
Without the possibility of inequality through different amounts of effort, there is no motivation to do anything.
Sure there is.
It's called "self-actualization", and sits at the top of Maslow's Hierarchy of Needs.
Would some people start partying all day? Damn straight. Others would sit down and do some serious thinking and writing, others would work on creating fantastic pieces of art, architecture, or what have you, and yes virginia, some people would choose to cook.
What, after all, is the motivation to post on Slashdot? It's certainly not advancing your career or your knowledge. Hell, you're lucky if *reading* Slashdot advances your knowledge, but we do it anyway.
Now I'll admit that even while some people might still be happy to take care of the sick and maintain power-plants, the numbers would probably be far fewer, but that's where the nanotech and robotics come into play.
That Jesus Christ guy is getting some terrible lag... it took him 3 days to respawn! -NJ CoolBreeze
I agree with the ideas espoused above, but wanted to correct some factual errors.
The fee for using a credit card is 3% MINIMUM, and only a large retailer can get that rate. For small businesses it's more like 10%!
Running a small business in Central California, I had an account with Cardservice Intl and paid 1.59%, with an annual volume somewhere around $80,000-100,000. 10% is simply rediculous, and it's a good idea a credit card merchant account isn't that expensive!
that's why it's illegal for the retailer to actually put the amount you're paying to Visa or Mastercard on the bill.
It's not illegal - it's just against the contract that you sign to get your merchant account. The contract actually says that you won't charge extra for credit card transactions.
You won't go to jail, but you might lose your merchant account!
I have no problem with your religion until you decide it's reason to deprive others of the truth.
The time frame is unclear, but eventually nanotechnology will allow exact copies of more or less anything. This will make cash, gold and many other current measures of wealth nearly worthless.
You're more right than you know. It makes the very *concept* of wealth nearly worthless. If nearly anyone can turn nearly anything into nearly anything else, then they have all the "wealth" they need! Pervasive nanotech could enable a "Star Trek" style economy.
Somehow, institutions will need to be established to keep track of everyone's net worth. What happens when crackers manage successful attacks on these? Shudder.
Why shudder? As long as I have technology to turn garbage into useful stuff at virtually no cost, what should I care what the system says my wealth is? If (when?) nanotech advances to the level where you can copy anything, traditional definitions of wealth will be as meaningless as medieval peerage systems are today.
0 1 - just my two bits
Perhaps you can volunteer at this and get in for free?
I have volunteered at conferences including Unsenix, Interop, WWW Consortium, and others and have allways received complementary admission.
It may be too late for this one, but if you become aware of stuff in the future (> 6 Months), you might have a better chance of getting in.
Especially if you off to do a key role, such as head up registration, logistics, whatever.
Mark
Cleara
Of course, what I'm really afraid of is that my wife may be the highest bidder. "What's this? You bought a pak of cigarettes, 3 beers and a Maxim?"
i read one of the panelists books awhile back (actually after a reference on slashdot :), the future of money by bernard lietaer. his main point is that "money is an agreement," which under that definition simplies the commonly understood definition -- a unit of account, a store of value, a means of exchange. so the scarcity of money in a society is a scarcity of agreement (echoed in dostoevsky's dream of ridiculous man btw, "if only we all agreed, it could all be arranged at once.")
:) and that there'd be fewer financial and economic catastrophes if 'alternative' currencies were promoted and in some cases legalized to fill gaps not serviced by 'traditional' money. in the US, for example, i think the federal reserve's monetary policy 'levers' are increasingly blunt tools to regulate business cycles and the economic environment. having myriad interoperating systems of currencies could provide for a more stable and balanced system. one of the more interesting non-fiction books i've read in the past few years!
from there he talks about how to create monetary systems that foster more agreement, creating money on demand with no inflationary consequences, such as Local Exchange Trading Systems (LETS) and HOURS. he also talks about demurrage currencies (used after WWI in austria--the worgl experiment--with interesting speculation that if it had been allowed to succeed, WWII may never have occurred!) and commodity buffer stocks originally advocated by keynes following WWII at bretton woods as the basis for the international monetary system (gold with the US dollar as reference currency was chosen instead--the white plan--and i think it was nixon who took us off the gold standard to finance the vietnam war more easily).
anyway, his point is that fractional reserve fiat based currencies are good for some things, but not suited for others (kind of like operating systems
also btw, that same poster who dropped the lietaer book on me also had an interesting post on dee hock oh and, another cool take on money is keith hart's the memory bank. sorry to see he's not on the panel.
For non-U.S. residents it is a bit suprising that all geeks here really only discuss the monetary/banking system inside the U.S.. Please please listen: In other countries things are alreay waaay different.
E.g. I mean, here in Germany we have a banking system with fully functioning direct deposit/direct debits which can be used by almost everybody, not only big business. These direct money transfers work at small cost (probably $0.10-$0.30 per transaction, but not something like 1% of the amount) and usually with at most 1-2 days of delay. This is the reason why something like Paypal wasn't necessary at all in Germany -- the German banks already offer these services by themselves.
We have the bank-independent online banking protocol HBCI, with a free implementation here and GnuCash supporting it. This means that for a direct deposit (money transfer) I can directly enter the destination account in a GUI form in GnuCash, enter my secret RSA key passphrase, and *pow* the money goes its way. Same way for statement retrieval -- no screen scraping anymore or browser incompatibilities. HBCI is a full protocol so all these business actions are fully specified in that protocol, and no web browser is needed anymore.
cstim