The Technology of Money

[Tim S]

http://www.bit-tech.net/bits/2006/11...f_money/1.html




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[Buzzons]

[sic] the idea of money cant be 12,000 years old, the world has only been around 6,000 years, duh! [/sic]

[Lazlow]

The Gadget show recently did a challenge on something similar to this - they were head-to-head, one with normal currency, the second using technology to travel to a destination and back again. Technology still has one or two flaws, well mainly in that many places still don't support the alternative forms of payment, but I can definitely see cash being a thing of the past within the next decade or so. I dislike carrying around notes and coins, a debit/credit card is a lot more convenient - and the EFT alternatives look very promising.

[Tim S]

Originally Posted by Buzzons

[sic] the idea of money cant be 12,000 years old, the world has only been around 6,000 years, duh! [/sic]

Its estimated that Barter (i.e. exchanging personal items) was used to obtain goods circa 9000 BC.

[Mother-Goose]

Originally Posted by Lazlow

The Gadget show recently did a challenge on something similar to this - they were head-to-head, one with normal currency, the second using technology to travel to a destination and back again. Technology still has one or two flaws, well mainly in that many places still don't support the alternative forms of payment, but I can definitely see cash being a thing of the past within the next decade or so. I dislike carrying around notes and coins, a debit/credit card is a lot more convenient - and the EFT alternatives look very promising.

Beaten to it lol I was just gonna talk about that when I read your post.

The payment over sms I found interesting, and the fact that while cash was excepted for the majority of things (except for car higher) it cost alot more!

[Buzzons]

Hehe, not if your a newborn/reborn/lolfailborn Christian who believes that the world is 6,000 years old

[The_Pope]

Loving the new layout changes (CTRL-F5 if anyone is seeing it strange - that will give you a fresh copy of our CSS file)

[mikeuk2004]

Show me the money!!!!!!!!!

[tkdwarrior]

it's articles like this that remind me that i shouldn't need to bother buying a paper-based tech magazine. Nice article, if a little out of left-field.

[customh]

Bloody good article, enjoyed it and learned some stuff along the way too... even got me to register with digg.

[specofdust]

Very enjoyable article, well done sah

[PA!N]

Highly interesting and well written article. Good job!

[trailblazer]

An interesting article here might show how vulnerable commercial IT infrastructure might be. Makes you wonder if we are becoming over reliant on technology.

[supermonkey]

Speaking of the changing face of money, apparently a US Disctirct Judge ordered the government to alter paper money to make denominations distiguishable to the blind.

I can see how the growing trend of paperless money could help eliminate that problem entirely. Just swipe your card and there's no need to rely on the clerks to return the correct change.

-monkey

[md2000]

There's 2 interesting points here.

First, is that the internet will do to banking, finance and econommics (micro and macro) what it has done to most other businesses. It will lower the threshhold for entry. Do you wanna be a music publisher? A journalist? A Banker? Now you can. The entry requirements are so much less than the brick-and-mortar world.

A number of smaller, less widespread banks can challenge the dominance of th large ones. A world-wide clearing network means that the credit card for the Bank of Podunk can have as much acceptance as the Bank of America. The rules for acceptance can no longer exclude anyone arbitrarily - meet some basic criteria and your in. Clearance itself becomes, like email, not an exclusive club but a service (or, more properly, a protocol between businesses) that anyone with the appropriate trust level can partake of.

That's the key - "trust level"- sort of like Mark Twain's definition of a dog - "A dog is that which is recognized as a dog by other dogs". Any entity can be a financial institution provided it is accepted by others. Big businesses like department stores and gas stations have known this (an how lucrative it can be) for decades, which is why they have issued their own credit cards.

So eventually, *anyone* can be a bank. As long as I behave myself, or can buy "deposit insurance" coverage, I too can be a bank. Actually, that would be "transaction insurance" - which is essentially what you yourself with a credit card are - a bank. You loan yourself money when you charge something. All the card company does is make the necessary transfer to assume/guarantee the risk on behalf of your creditor. We are all, with our credit cards, lines of credit, and security-worthy assets such as houses, becoming miniature financial institutions. The decisions on the overall direction of the economy is devolving from the government, or a dozen powerful banks, to a billion private citizens with the ability to decide to flood or starve the market at any time.

Which bring us to point 2, which I thought this article would cover: What, really, is money?

We are forced to vary the definition from Mark Twain. "Money is that which is recognized as money by people who want your money". If someone is willing to accept your promissory note, you've created money. If they can trade it to someone(s) else, it's liquid cash.

All a bank does, is assist your money in time travel. Spending money that doesn't exist yet is helping it travel backward in time. Storing it for future use is helping it travel forward. Even a government, issuing bonds against your grandkids' taxes, is time-travelling it's earnings.

Unlike time travellers, money can be in 2 or more places at once. However, if it gets too crowded, the relative power of each dollar goes down, so the cost of time travel (interest) goes up.

There's also the fact that money travels horizontally, from one pocket to another. How fast it circulates is another factor that affects it's value and how fast things happen in the economy. Of course, whole books can (have) been written on all these details.

[Aankhen]

Very informative article. From my personal experience so far, here in Canada, debit cards are waaaay more useful than paper notes or coins. No change to worry about, no bulging wallet to guard with your life, and even if you lose your debit card, the person still has to crack your PIN (which, if you're smart, is the maximum length allowed ). Too bad they don't accept debit cards for bus fare and parking meters... oh well, at least I don't have to pay bus fare thanks to the university bus pass and my own car.

Ahem. Back to the subject. I've only recently discovered the wonders of PayPal. It really is quite fantastic. It seems much more secure and convenient than handing out your credit card number to any old site that asks for it. I wish more sites supported payment through PayPal. My only gripe is that they take ages to process changes.

Originally Posted by The_Pope

Loving the new layout changes (CTRL-F5 if anyone is seeing it strange - that will give you a fresh copy of our CSS file)

Ah, thanks for that. I was wondering why the layout looked a little messed up.

[speedfreek]

Originally Posted by supermonkey

Speaking of the changing face of money, apparently a US Disctirct Judge ordered the government to alter paper money to make denominations distiguishable to the blind.

I can see how the growing trend of paperless money could help eliminate that problem entirely. Just swipe your card and there's no need to rely on the clerks to return the correct change.

-monkey

Yeah, just saw that in the paper this morning, usually a blind person would have some sort of system worked out to deal with that but it would still be better for them with a new way.

I find the most convient way to pay is with my credit or debit card, the only problem is person to person transactions dont work that great like that.

Good read.

[Cthippo]

I wouldjust like to say that in the interests of fairness, if we can't say F - T - W then the staff shouldn't be able to either

[Tyinsar]

Originally Posted by Article

..Then imagine no more trips to the bank, no more miserable issues of a lost or stolen card, no more ATMs. Take it a step farther and you can see a drop in muggings, as credit cards and cash would no longer be able to be removed from the person. But don't worry about not being able to give Junior a few bucks for the movies - a couple clicks at a terminal and you can put the credits right into his account using an ultra-secure transfer.

There's an old axiom that my dad really liked: "Locks are made to keep honest people honest".

[Firehed]

Hm.... not sure if it's a good thing or a bad thing that the first page taught me more in ten minutes than my economics class has all year. Well done