Market Curiosity: Exploring Markets And Systems

September 11, 2013

10 Dating Ideas Almost Nobody Wants To See, Hear, Or Know

Filed under: 10 Ideas, Editorials — Jeff Fitzmyers @ 8:51 pm

Disclaimer: Musings, in general, I have no proof, April Fools…

  • First, give some space and relax:
  • No sex until you see, understand, and accept, their shadow side. Everyone is a package; there are no line item vetoes.
    • Soon tech will be to the point where we can tell our bed at night, “Make me half zebra with iridescent stripes that shed rose petals” and billions of nano bots will have us ready by morning. So we will shroud with increasingly pretty and distracting covers. Learn how to get the heart now — talk about gender identity issues!
    • Conversely, you are having sex with their shadow too. Hmmm… do you have any idea what it looks like? The fangs? The claws? The abject stupid? Beer goggles can’t fix it!!
  • Try not to break item 1 too soon. 😉 But…
    • Waiting until everything is known and perfect will doom the species. Even moderation shouldn’t be taken to excess.
  • Partners should bring out the best in each other. Everything we want is already inside of us. Nice, warm and fuzzy, but…
  • Dating sucks because consciousness attracts consciousness, and 90% of us have trouble letting go of baggage, thus, therefore, ipso facto, and a prima facie: duh, we have baggage.
    • If your dates consistently tend to be a !?#*@*@!!, list what you hate about them. 95% chance they are just mirroring your own baggage. So title the list, Things I Don’t Want To, But Might Want To, Change Someday Even Though It’s Definitely All Their Fault. Now pick one and sit with it until you understand it’s facets, and the heat dissipates. Doesn’t mean they are not still !?#*@*@!!’s, just that they are not driving your life off a cliff.
      • Now you don’t have to find a real therapist. Ironic! Because good therapists are rarer than good dates. That’s why a monk lifestyle seems so alluring and sexy.
      • Focus on what you do well. NOT baggage, unless it is in the way. Then, be optimistic! Maybe you only have one piece of baggage? Work though it and see if that was good enough.
  • Consider asking your date, “What do you want?” Be vulnerable first.
    • Defenselessness shows that you are comfortable with yourself and have some courage.
    • Shows you are not just mirroring what you think they want to hear that you think they want you to think you hear… too freaking confusing.
    • Makes people feel safer, and so, lie less.
  • Don’t gossip. Bonding over gossip is fun and easy, but then all you have is a hollow relationship based on disparaging others.
    • And those others will likely find out in seconds, probably from your date, hate your guts, key your car, and forever spread nasty gossip about you.
  • Be kind. Life is challenging. You will probably never see them again, unless you want a crappy relationship, so give them a complement. What  children remember most about parents? If they were kind or not.
  • Men, sorry: women are smarter and more capable than us, in multiple ways.
    • Historically, while we were running around chasing stuff that ran away from us (easy to bond over and rather fun until they chase us back), women were having to raise kids, get along with each other, grow food, make lunch, and be the last defense to marauders. They often let us think we are smarter to save the effort of being in a power struggle they win anyway.
    • Also historically, women had to deal with worrying about us not returning. Was our absence due to the allure of marauding another village’s women? Or were we painfully hobbling home half eaten? Although women tend to like us, this presents them with more work to do: Find another mate, or nurse us until we die from smelly infections, and then find another mate anyway. So, women like it when we return when we say we will return, and give them something valuable. This used to be called survival, now because it’s trivial for women to procure their own protein, this is called romance and it’s more complicated.
    • Men have to adapt: now the chase is to do something that uniquely speaks to a woman’s soul so that they know we are paying attention to them (not too their friends).
  • Women, sorry: We are confused with adapting from primarily protecting you and our children (our genes), to nicely supporting you and your children.
    • Historically “protection” and “nice support”, are mostly mutually exclusive. An effective protector tends to shoot first and ask questions later because empathetic ponderers are super easy to kill, making you and your kids more vulnerable. That’s why there are 10 times more psychopathic males than females.
    • And protectors need to be roaming about looking for trouble to keep battles away from home. But males are still social creatures, yet are often away from the supportive social nexus.
    • So, historically, young males are lonely jerks who need a lot of testosterone to stay alive but then are sexually frustrated and make poor snap decisions. Currently there are more around because war changed from physical, to economic and informational.
    • The old pattern of dealing with stuff was hard to let go of because it’s so alluringly simple:
    • Can I hump it?
      • Yes, then do so. (But don’t bring it home!) Then find something else to encounter.
      • No? Well, can I eat it?
        • Yes, then do so, and bring some back home, stay for a bit, then go out protecting again.
        • No? Well, can I kill it?
          • Yes, then do so. If it’s food, bring it home. Then find something else to encounter.
          • No? Well, umm.. can I hump it?
  • “Power is never granted, only taken”. Lead the way with grace to receive what you want.

leaf heart

Related
Zenith expressions of joy are universal, pure, and innocent; best romantic framework known…

Update 1 January 2015
Tucker interviews Dr. Christopher Ryan, the bestselling author of Sex at Dawn

August 26, 2013

Economic response to why fire hydrant locations should stay “secret”

Filed under: Castpoints, Editorials, Systems — Tags: — Jeff Fitzmyers @ 9:29 am

The following was sent to a lot of people via a list. The response:

cricket

I don’t know why? The following seems to be a very rational and concrete way to handle a complicated situation:

I like Bruce Schneier’s take on security. A great way to evaluate options is to put a price tag on all the variables so they can be easily compared.

A) Hydrant information is already public, just not convenient. And to some degree, pipe information is probably knowable “enough” just from connecting dots on a map because small pipes flow into bigger pipes, and the start and end of lines are obvious.
– The cost to an attacker to gather this data is very low.
– The cost of keeping this data (servers, managing and monitoring access) is ???
– The benefits (in $$$) to making parts of this info transparent so it can be used is ???
– There are benefits to local people taking ownership of local infrastructure — they take care of it more. What is that worth ($$$)?
“Security by obscurity” has low value.

B) Past threats
– What was the cost of each way stopping past threats?
– What is the cost of each preventive measures? Including false positives.
Typically, standard police work probably stopped the threats, and or the majority of threats would have a  minor effect.

C) The public’s fears are typically very irrational and disproportionate.
– What is the real cost, in dollars, of mitigating each of those fears?
– Rank all threats via probability.
– What is the cost of mitigating real threats?
Present this information to the public and ask them how much money they want to spend, in aggregate, and per person. It’s educational without being preachy or boring, takes pressure off policymakers (who would prefer to go overboard to be able to say, “we did everything possible” rather than have a problem on their watch (I would!)), and people have an easy way to compare alternatives so discussion can be concrete.

D) Out of date data.
– Just indicate when updated. If it’s very important, the user can double check things.

E) The GIS data.
Applying the general 3 levels of threat:

  • The opportunistic (stealing stuff from unlocked cars, etc.). Basic common sense (locks, gates) fixes the vast majority of this. GIS data is safe because these people don’t even know what GIS is — it has no value to them.
  •  The moderately determined (people who deploy a moderate amount of resources). People could spend weeks in planning, join a company to get trust, passwords, etc. One rule of thumb is that roughly 75% of security problems are inside jobs. If true in this case, that automatically provides a ratio of problems to solve.
  • The very well funded, typically government, military, etc. Basically can’t readily protect against them — too costly.

Mr. Schneier often says, after the obvious threats are addressed, it’s often better to allocate resources for monitoring and fast intervention and remediation, rather than on increasingly low risk reward situations. Darwin’s adaptability.

February 20, 2013

PEMS Pocket school phone tree and Event Management System

Filed under: Castpoints, Editorials — Tags: , — Jeff Fitzmyers @ 12:28 pm

PEMS (Pocket Event Management System) is a flexible browser based application that simplifies communication between a school’s, parents, kids, administration, emergency responders, and the public. It’s low cost, low bandwidth and can run on any cell phone with a html browser. It’s based on a simplified version of the industry standard role based Incident Command System (ICS).

PEMS also works well with fairs, parades and other group activities.

Current Emergency Management Problems (in our school district)

  • Communication is only broadcast, there is no way to reply to emails or voicemails. When checking an email on an iPhone, I was prompted to download software. In a real emergency, this could tie up a lot of bandwidth.
  • Parents don’t know the status of their kids, and can’t communicate with them.
  • If kids are to be picked up, what if a parent can’t make it? How is that communicated to the office? How does the office handle all that communication?
  • In the event of a serious earthquake, where emergency responders might not be able to help, how are groups of people triaged? How are supplies requested, allocated, and transported?
  • In an earthquake, everyone meets on the large playground. How do people communicate?
  • Information is extremely course grained.

A solution to all those issues is a simple system that organizes the relationships and communications between people based on roles and resources. Parents, responders, and volunteers, have collaborative real-time access about everyone’s condition, abilities, and resources, to effectively do triage and allocate resources. Sample use case (draft)

Parents

  • Be informed of each major change in your kids status, location, and condition in real time.
  • Be able to contact children, and or their stewards, directly.
  • Be able to send kids to a neighbor’s house if unable to pick up.

Emergency Responders

  • Know many aspects of a situation before arrival (number involved, short description, photo) and so can start triage immediately.
  • Know location of incident.
  • Have immediate access to kids medical history on file.
  • Reduced response time because information can go directly to responders.
  • Can easily create new groups of people to manage situations in real time.

Teachers And Administrators

  • Can formally communicate while away from computers and if electricity is interrupted.
  • Reduce workload in multiple ways.
    • Most information is already present, and updated on a distributed basis.
    • Most decisions are made by a few taps.
  • Multiple near real time of filtered and organized information allow much better and faster decision making.
  • Communication is bi-directional.
  • The role of liaison with the public, and other jurisdictions, is simple and easy.
  • Can easily create new groups of people to manage situations in real time.

Kids

  • Know that they are in a system that supports them.
  • Have quick and direct access to parents.

Privacy And Preferences

  • Because of modularity, privacy is automatically protected.
  • People own their own information. In this case kids own their own information via their stewards. This avoids: Your School Is Screwing Your Kids For Profit.
  • Participants can pre-select which categories will trigger information being sent to them.

Cost
First month free. Then, if paying as an individual, participation costs $5 every 3 months. Or, if an event is paying, the cost is $1 per participant on the 1st of the month, and the participant pays zero. If a participant is in, say, 4 events, each event pays $0.25 and the particpant pays 0. Nobody is double charged, but payment is non refundable.

PEMS is a subset of the patent pending Castpoints system, and should be available September 2013.

February 11, 2013

Divine right of kings in 2 silly currency actions

Filed under: Castpoints, Editorials — Tags: , , — Jeff Fitzmyers @ 10:52 am

Hollande warns on euro strength, denounces markets for currencies Francois Hollande has issued a clear warning…”

Backed by what? Nothing, other than his say so? How is something clear if there are no details?

“…that the current strength of the euro…”

What strength? The weekly EUR has been in a trading range for at least 5 years.

EUR weekly Feb 11 2013

The monthly chart supports the idea that the EUR is not at obvious extremes.

EUR monthly feb 11 2013

“…could damage the fragile economic recovery in Europe…”

How so? Because he says so?? Could the issue really be they need to devalue the currency to pay off all the debt they have created via the hidden tax of inflation? Probably the most damaging thing is politicians changing rules to bail out favorites, which costs money, and increases uncertainty, and therefore makes capital reluctant to be deployed and create wealth.

“…calling for international action to stem currency distortions…”

  • Why should I be tasked (pay money) to fix a problem that is only a problem because some guy thousands of miles away asserts it’s a problem? Projecting power is costly.
  • How would I know what kind of distortion to add to an already supposedly distorted currency? That’s ripe for unintended consequences. Who suffers the consequences?
  • Why would distorting and already distorted currency work? Are there any examples in history of this working long term?
  • What’s in it for me?

“…The euro should not fluctuate…”

All fait currencies fluctuant — especially in relationship to asset backed currencies, because they are backed by what suits the divine rights of kings. When they want money they just print it up. If you want less fluctuation, back your currency by something: stable, does not spoil, is semi rare, is divisible, is fungible, and has value that is readily accepted worldwide. Oh, you don’t like that because you can’t just print it up every time you want something for nothing. Like promising entitlements, that grandchildren will have to pay for in exchange for votes (control).

“…according to the mood of the markets…”

It’s not a capricious “mood”. (I love how “markets” are denigrated!) It’s simple supply and demand, constantly messed with by on purpose “distortions”. Oh, you mean currencies should only fluctuate based on the divine right of king’s mood? I’ll stop here.

Many welcome departure of pesky penny The [Canadian] penny is on the way out, and that’s good news for people tired of dealing with the nuisance coin…”

It’s only a nuisance because the currency has been debased enough to make the metal worth more than the hidden tax of seignorage. Funny how the opening line makes 2 kinds of theft, the hidden taxes of inflation and seignorage, seem like gov is on top of things, helping people out, with good news. Although the whole article never talks about why the penny has become a nuisance, 3 of the 6 commenter’s apparently do. The penny is 94% steel. Iron costs money to “print”.

There would be no problem if the coin was valued in grams of steel. Instead politicians decided to define the value of a resource by fiat (probably to accrue seigniorage). Has there ever been a case where a fiat currency worked in 5,000 years of economic story? Not that I know of.

GDP only doubles…
canada-gdp-per-capita

Yet money supply up “a lot”…
canada-money-supply-m3

Update February 13 2013

The Great Lie That Will Bankrupt America The world’s money system – the scales upon which the world’s market functions – is being deliberately destroyed. And so, the monetary signals that guide the markets – which are supposed to represent the supply and demand decisions of billions of people – have become distorted…

[Edward Gibbon] …when the freedom they wished for most was freedom from responsibility, then Athens ceased to be free and was never free again.

Free competition among currencies minimizes mal-investment.

February 8, 2013

On silver manipulation; How non-nature based control systems fail: puny gods!

Filed under: Editorials, Systems — Tags: , , — Jeff Fitzmyers @ 6:45 pm

“Does charting work in manipulated markets?”

A good rule of thumb is supposedly the more psychological emotion that is involved in a stock / commodity / whatever, the cleaner the patterns are. Aren’t there seemingly a lot of forceful entities around who care a great deal about silver’s price?

I use charts as reference points, not prediction vehicles. Basically I try to notice low risk, high reward entry points, enter, then trail stops in order to let profits run while minimizing losses.

We humans manipulate our environment all the time. Manipulate — Latin “handful”

  • Handle, alter, edit, move.
  • Examine by interaction.
  • Control, influence cleverly, unfairly, or unscrupulously.

The problem stems from the divine right of kings where “special” people don’t have to deal with laws. It’s an inherently win-lose system. Thats why I like contracts. It’s an inherently win-win system.

The question is, do “special” people really “control” the markets, or do they just surf the overall current meme (“control works” in this case) and SAY, PRETEND, and ACT as if they are in control?

“Beneath our poised appearance we are completely out of control.” — The Merovingian

If these people are so special, why can’t they control things long term? Maybe because they are unique, just like everyone else and not above evolution? I have yet to notice anyone powerful enough to control evolution. (I view the ability to manipulate genes as an expression of evolution.) If things change in the direction of decentralization (power), won’t those who glorified themselves with a false mantle of control (force) be left high and dry wondering what happened?

Puny god.” – The Hulk, Avengers(?) (SOOO funny!)

A simple view: The charted price of COMEX silver is the charted price of COMEX silver because of the current overall supply and demand of silver — including legal and illegal manipulation. When a variable changes, the price chart will too. It has to: It’s displaying actual transactions. “Reasons” for a transaction are a dime a dozen.

  • Currently demand is willing to accept paper supply, if that changes, so will charted transaction price.
  • Currently few care about silver, so it’s inexpensive to paint the chart. When “enough” care, transaction price will reflect that, and it will cost a lot more money to paint the chart. If “a lot” of people care, it’s likely cost prohibitive to paint the chart. It’s all supply and demand.

The other question is, why the heck are people trying to compete directly with “superior” forces? Why enter into a win-lose situation when you don’t have to? Find your own niche. Power is never granted, only taken. I know a guy (~Frank) who was hired by a fancy accounting / management firm. Competition was very intense (wide and deep) between “colleagues” for billable hours. How does one deal with that? Relax and wait for an opportunity: After a while Frank noticed an opportunity that allowed him to create a whole new stream of billable hours via a whole new class of new clients. Frank had zero internal competition, grew his team quickly and was the youngest and newest employee ever to be offered a partnership.

Frank eschews paperwork, and to be a partner, you have to fill out stuff. He just threw it in the trash. His boss kept calling asking when he was going to turn it in. Frank would just say he was too busy billing hours and hang up! What’s his boss going to do, fire him? THE BOSS HAS CONROL, BUT FRANK HAS POWER. And that’s how, and why, non-nature based control systems fail.

Old Story
I have personally observed an (anonymous) person short the bond market years ago with superb precision. Months before the ideal time to short anonymous started refining the projected zone using longer term charts. As things got closer, anonymous moved into shorter time charts. At the end anonymous was using 5 min charts, shorting with stop loss points of only 1-2 ticks. Anonymous was stopped out about 3 times that day for a max loss of 6-7 ticks, which is minuscule! By the end of the day anonymous had a big short on and rode it down for months.

Sounds great, right? Well, who has the knowledge, discipline and confidence to publicly stalk, but NOT enter a trade for months, then enter and be incorrect 3 times in a row in a few hours, make a 4th trade and not touch it until months later and exit near the bottom? Anonymous said it took about TWENTY years of Gann studying to be that skilled.

January 31, 2013

Universal distributed resource allocation: services, tasks, goods, content

Filed under: Editorials, Systems — Tags: , — Jeff Fitzmyers @ 10:04 am

Update June 2014: Mini proposal

Update January 31: Some things have been simplified, but I am not taking the time to update the info just now. The main principles remain.

Castpoints: A universal management system for collaborative allocation of: scarce (goods, services) and non-scarce (digital content) resources by mimicking Nature’s way of allocating value. A synergy of:

  • Free market economics — Private property, privacy, transparency, low entry barriers, subsidiarity.
  • Universal trading engine — Specify any wants and offers easily and dynamically.
  • Trusted transactions — Reputation, localized expert conflict resolution, insurance.
  • Securitization — Any resource can be compared, traded, promoted.
  • All things have value — Arbitrage promote miss-valued and marginalized (yet un-exploitable) resources.
  • Hierarchy and taxonomy — Used to organize, rather than ostracize.
  • Fun — Only adding value works (thriving), not defending, nor attacking (surviving).

Elevator Pitch
The Castpoints platform maximizes physical and digital resource allocation by correctly securitizing (segmenting, organizing, and pricing) any resource. Barriers to entry are near zero because contracts, reputation, localized conflict resolution, and performance bonds keep participants heading toward what works.

Scientific Elevator Pitch
Castpoints is likely the next major step in digital communications. It unites Kurzweil’s Singularity, Davidson’s Sovereign Individual, and Taleb’s Antifragility, via a self regulating platform. All resources are managed as directly as possible based not on beliefs, but on supply and demand, conflict resolution, reputation, transparency, fractal subsidiarity, and private performance bonds. Scarce resources are allocated via a universal trading engine. Non scarce resources are managed via an optional cost to post for: paying value adders, winnowing and promotion of value, and making untruths expensive (via paying untruth finders). People WANT to participate because the more they add value, the more they can profit, and it’s fun!

Expanded Use Cases And Supporting Content (Although Castpoints simply organizes the internet, the huge paradigm disruptions make it hard to understand. These links give practical reference points.)

This Set Of Problems…

  • People often don’t own their content.
  • Information overwhelm.
  • People can’t easily pay other people.
  • Difficult to know the value of content.
  • Difficult to know how content is related to other content.
  • Correcting information and conflict resolution can be very challenging.
  • Censorship; manipulation; propaganda.
  • No simple and effective way to screen things from children.
  • Can’t easily buy and or protect copyrighted material.
  • Can’t just make a great video and get paid for it; rarely paid for adding value.

…Is Solved With Free Market Initial Conditions…

Free Market Principle Fancy Term Nature’s Analog Notes
Value Resources Joule, Light, calories Content, goods, services
Skin in the game Capital at risk Direct participation It’s just hot air until someone puts cash on the barrlehead.
Private property Node Cell’s, tissues, organs People’s blogs, forums, and websites. Everyone is their own profit center, and owns and manages their own reputation.
Low entry barriers, structure, contracts Connections Roots, relationships Groups of nodes are related by formal role based contractual hierarchal networks. Everything is connected. Cells, tissues, organs, organisms.
Competing currencies Value units Hemoglobin, chlorophyl Effective allocation of resources uses an abstracted, and likely scarce, resource that enough people agree on. Default units are shares of stock. But anything can be used.
Transactions based on supply and demand at a specific price. Evolution Life, movement Based on agreement, not force. Since decisions are not based on politics, mal-investment is minimized .
Subsidiarity, Transparency, Verification, conflict resolution Feedback loops, reputation Teeth, claws Management by the smallest, lowest, and or least centralized authority capable of doing things well, support the balance of privacy and transparency. Hormones.
Fullfilment Sanity Be-ing If people offer projections, illusions, and unfinished traumas, the feedback will likely be less money and positive suggestions. If people don’t know their value, they can iteratively, at a small level of risk in a supportive environment, experiment. When people start to offer their unique value, they will feel good, make money and receive complements.

Solution: Theory, Metaphor And Overview
Chaos theory suggests that a complex system’s behavior is highly sensitive to initial conditions and slight changes of those conditions. The current dominant cosmology theory of a big bang suggests that the universe was born from a singularity, where “many laws of physics break down” and there is no specified origin for the singularity itself. In other words, the genesis of the universe is currently the belief that, “Many things are the way they are because we say so.” This manifests as the belief of “Divine right of Kings.”

The universe appears to be iterative with simple rules according to Stephan Wolfram and others. So a major iteration of the big bang theory is watered down to produce “Natural Law”, Natural “rights”, and government in an effort to reconcile a divine right of kings belief with reality. This does not work, yet many more laws and regulations are iteratively created attempting to force harmony. Finally society can’t withstand the economic burden of the cognitive dissonance, and fails. Although the new society has vitality because it’s focus is on what works out of necessity (needing to get commerce going again quickly), it’s still hobbled from the core belief of royal absolutism and will one day fail, again.

An alternative cosmology, Null Physics, suggests that in the beginning there was literally nothing, a void. If a bit of that nothing was removed, well, now their is something! Specifically there is a separation between things, but if put all together again, the “equation” sums to zero. This can translate into the universe’s initial conditions of, “Things are the way they are due to separation, each bit/relationship is unique compared to every other bit/relationship, and not only is that okay, it’s fun! But it is not special.”

The genesis of trouble is constantly mal-investing to prove that separation has some type of “special” meaning, rather than the RELAXED state of noticing that “separation” just means “difference”.

Iteration produces a separation that not only denotes “this” and “not this” but also mediates interactions between both. This is the basis for almost all biology as currently defined: the semi permeable cell membrane. Not considering viruses, etc., the next main complete and successful system is the cell. Cells are the main functional unit of most biomass on Earth. The reason Castpoints works, is because it mimics the cellular purpose, structure, relationships, communications, and resiliency in a fractal way: A physically healthy cell has strong boundaries. A psychologically healthy person has strong boundaries. A strong building has a strong foundation which is the boundary between the building and the ground.

Cells naturally and immediately excrete what they do not need anymore. If they don’t, they get toxic. Philosophically, suffering (not pain) is caused by not relaxing and holding on to things that no longer have value. Metaphorically, grabbing a rose and getting pricked by a thorn is pain. Clenching onto the stem and thorn is suffering. Relaxing and letting the rose fall is healing.

Castpoints fixes that by securitizing everything, stewarding trade based on the common denominator of value with minimal trading barriers (friction), and quickly letting go of what no longer serves specific individuals.

Their is a heavy focus on intrinsic motivations. Extrinsic motivations, like money, are not necessarily used to motivate people, rather to allow comparison of things that are hard to compare.

The Market
Conservative example: Tumbler, a very large site, has about 7 million image posts per day, with each post reblogged an average of 9 times. Paypal charges about 3.5% + 15 cents per transaction. If 1% of posters used Castpoints at a cost of 1 cent, that would generate $700 per day, $20,000 per month, in revenue.

Airbnb, an apartment rental site was recently valued at $2.5 billion. All they do is manage a transaction between people who want or have a place for rent, for a 6-12% fee (including customer support, payment handling, and insurance). Castpoints all sources customer support and insurance and so charges probably less than 1%, to offer transferrable reputations, built in “taxes”, and manages most other net transactions as mathematically efficiently as possible.

Castpoint’s role based way of managing resources is based on the Incident Command System (ICS) that is used by many (most?) emergency response entities. The few implementation quotes I could find ranged from $150,000 to $3.25 million. The fact quotes are scarce can mean ICS systems are serious money, and far from a commodity). There is no web based version available for any price.

Investing in Collaborative Consumption: Venture Funding in 2012 …collaborative consumption ventures will continue to be a hot area for investors in 2013. Investments in startups topped $431M in 2012, up from $400M in 2011. While not a significant increase in overall funding, the collaborative consumption space has received consistent venture capital over the last 12 months from leading investors such as Sequoia, Union Square Ventures and Floodgate.

That article shows each niche market of money, travel and accommodation, fashion, ride sharing, pet sitting, etc., getting individual attention, yet uses the same pattern. A properly designed universal transaction engine like Castpoints could enfold all the niches. As collaborative consumption defragments, “…the rise of identity and reputation tools focused on further reducing friction in p2p marketplaces will be a hot investment area in 2013.”

FORBES estimates the revenue flowing through the share economy directly into people’s wallets will surpass $3.5 billion this year, with growth exceeding 25%. …have raised $120 million to date from Sequoia, Greylock Partners, Andreessen Horowitz and Y Combinator. A $112 million funding round in 2011 gave the startup a $1.3 billion valuation. Chesky and his partners are currently trying to raise another $150 million at a valuation of $2.5 billion…

Revenue Model
Simple small transaction fee paid via an event’s shares. That way, CP and participants’ interests are directly aligned. An event has to be profitable enough to generate dividends. Event’s that don’t generate income essentially operate for free. Notice how the definition of  “non-profit” is automatic, not arbitrary, and requires zero regulations, etc.

Paradigm Disruptions

  1. Anyone who adds value will be paid in 7 days.
  2. All transaction, including with advertisers, are win-win.
  3. Castpoints is built on capital, not debt. Capital makes prosperity. Debt makes slavery. “Credit” simply labels the slave master.)
  4. People own their “own” information, and can control who sees what, when, and how long. Events own aggregate information.
  5. Because people are their own profit center, they can issue stock (at the node level).
  6. People can offer to buy and sell anything. This means all currencies and scripts compete on a level playing field. People can be their own “central banks” and manage their own money supply. (“Give me control of a nations money supply, and I care not who makes it’s laws.”)
  7. Conflict resolution migrates from ponderous government fiat, to fast contractual local experts. Contracts, not laws are used. Laws by definition are win lose and backed by guns (force) and punishment. Contracts are mutual agreements and therefore win-win. Contract breakers have pre agreed to amends and often those amends are already escrowed. Consequences are the only things “enforced”.
  8. Copyright payments are automatic. Content creators automatically get paid with no extra effort on their part when their content is used by others in such a way that it generates income.
  9. Adult material can easily be labeled, screened, and enforced.
  10. Point of sale “taxation” is built in, correctly implemented, and transparent.
  11. Since any web user can add value to any website (node), a company can gain value to from non-employees. This is called “all sourcing” as compared to outsourcing. (This is partly what drives a simpler “tax” structure.)
  12. A simple search will display an item’s supply and demand in a structured way, and market size information.
  13. Many marketing campaigns can run themselves. Content managers can easily and VERY effectively spend “advertising” money by offering a transaction fee of, say, -10%. This would quickly attract quality value adders because they get paid to participate. (Low quality value adders are not attracted since their rating is too low to make money.)

What Happens To…
eBay uses centralized reputation, has multiple fees, and charges 2 to 13% of final sale price. Castpoints uses decentralized reputation and has one transaction fee of (likely) < 1%. (Low fees are partly due to all sales being final on castpoints. Conflicts are handled by the conflict resolution process, or return policy.)

Why trading with limits is preferred over auctions:

Limit Method Auction Method
Price risk Lower risk. Both parties control the price they are willing to trade at. And the limit prices bracket the probable tansaction price. Higher risk. The transaction price can vary a lot.
Time risk Lower risk. Both parties control their time window. Higher risk. The choices are Buy It Now at a set price, or 1, 3, 5, 7, or 10 days.
Transaction fees Lower: about <1%. Higher: 2-13%.
Conflict resolution Better since it is diss-aggregated. Local participants with near direct knowledge of the situation, and high value ratings, decide quickly. Also, insurance is handled directly be competing insurance sellers. Aggregated in the transaction fee. Decisions come from eBay employees wich is relatively indirect.
Price management If a buyer or seller wants to trade about 10 items per day the software will automatically set the price so that supply and demand balances out at about 10 items per day. Not available as far as I can tell.
Securitization Better. Apples can be compared to apples. A resource is listed by a short descirption that describes about 80% of the resource and produces an ID. Optionally the condition is added, and number for sale, etc. When somenoe searches, they are really using the description ID “and” the condition ID, etc. Poor. Currently there are over 18 listing for Harry Potter’s complete 7 book set. Min price is $2, max price is $212, AVG is 49, Median is 32, and STDEV is 49! That is price discovery?
Price depth Because of the above securitization, a simple search produces price depth, just like a price ladder for a stock. Poor. Just guestimate.
Shill bidding Immune. Once an oder is in, it’s live for at least 2 transaction cycles. Not immune 🙂

Google search primarily indirectly values web pages by looking at who else does and the results are a flat, unstructured list. Then people try to game Google’s algorithms, creating an arms race. Castpoints is immune to arms races. “Money talks” and the cream rises to the top as a natural part of typical communication. Also, search results are structured, categorized, and likely have a timeline and location. Search results for “egg shells” could look something like this partial sample:

Search “eggshells”
Last (Hour, Day, Week, Month, Year).
Within (±1°, ±2°, and or 25km, 100km, 500km, anywhere)
Min value rating: 50% (or min performance bond: 3x)
Min value: 1 CAD
Category Transactions Supply Demand
Eggshells • 50 Pre-cleaned eggshells for crafts, 10 CAD
• Children’s stories mentioning eggshells, 2 CAD
• 99% Pre-cleaned eggshells for crafts. 200 @ 10 CAD each, by Jim Spencer
• 99% Pre-cleaned eggshells for crafts. 50 @ 10 CAD each, by Julie Smith
more…
• 99% Pre-cleaned egg shells for crafts. 100 @ 1 CAD each, by Larry Lizard
• 85% Children’s stories with about eggshells 5 @ 10 CAD each, by Nacy Drew
more…
Uses • 95% Ten ways to use eggshells, 12 CAD
• 94% Holiday eggshel crafts, 17 CAD
• 60% How many eggshells for compost? 10 CAD
Images • Eggshell sculpture, 5 CAD • 68% Eggshell dolphin etching 4 CAD • 80% Eggshell dolphin etching 2 CAD
Proper Names • Eggshells, resturant in Lake Zurich, IL. 60 CAD • 78% Eggshells.com 300 CAD • 95% Eggshells, the 1969 movie DVD, 8 CAD
Children’s Story • 85% What are eggshells made of? 2 CAD • 85% What are eggshells made of? 1 CAD
Movie • Chick hatching, 10 CAD • 75% Chick hatching, 15 CAD • 85% Chick hatching, 14 CAD

“Local, ±1°, 25km…” Location can be denoted as simple distance, or by actual structural distance between nodes. This way, friends and local networks are able to keep value (money, reputation, conflict resolution, power) in the community.

The percent values at the beginning of the line can change a lot. Better business will likely have very high ratings, while just a person ordering from home could be much lower because they might only have a rating from a forum. This is why it’s important to allow people to manage multiple ratings. Just because someone has a low (or high) rating in one area, does not mean they are horrid (or spectacular) in all areas.

Part of the point is that with one search, people get a snapshot of the economic “eggshell” universe and can start interacting with it. Of course there would be charts, and maps associated with everything. Including historical and current price, location, volume, etc.

Specific Cases Of Infatuation

  • Advertisers – For the first time in written history, ads are welcome because people either get good info, or get the advertisers’ money.
  • Copyright holders – This is an evolution of copyright: paid for adding value rather than fighting to protect value. Transparency promotes paying others for content, even what is “fair use”, so they don’t look cheap.
  • Forum owners – Finally have a built in conflict resolution process to manage trolls and flame wars.
  • Regulators – Takes a huge load off what government is “supposed to do”. Now proven competent local people , who are also, held accountable, make money and increase reputation by participating in conflicts.
  • People with no money – If they add value, they will get money. They can start with literally zero money and, say, organize a FAQ page, correct typos, etc., and be paid in 7 days.
  • Small publishers – Can have much more fine grained and direct info regarding supply and demand of their topics of interest. If a post goes viral, they can make a lot of money and increase reputation very quickly with no additional effort. Just answering questions about their viral post exposes them to more compensation.
  • Lurkers – Can explore and enjoy an environment with a minimum of trolls and much more confidence about the quality of information.
  • Email readers – allows senders and readers to prioritize messages. Makes spamming not worth it.
  • Entrepreneurs – Velocity of money and capital productivity should be very high engendering prosperity and excellent feedback on allocation of resources.

Mini Use Cases

  • Free kittens? Just do a simple search in your area. Supply and demand will appear (graphically hopefully!). If you zoom out, you might notice that there is a demand for kittens 50 miles away and you just happen to be traveling out that way tomorrow. (Just found out there is a real need: A New Matching Market for Dog Buyers. 1) How does one avoid puppy mills, and “Th[e] problem of geographic displacement in the animal rescue market is a problem I would love to see a brilliant economist help solve.”) Walmart is getting int the act: Wal-Mart may get customers to deliver packages to online buyers.
  • Need 10 pounds of bean seeds delivered within 1 month? Look up current prices and place a limit order for 20% below the current price with the option that the price will increase 1% per day until the order is filled.
  • You manage a restaurant that is busy mostly between 7 and 9. Yesterday was a slow day and you have a fair amount of food you will have to throw out son. So you offer 20% off for customers between 5 and 6:30. Who needs Groupon?
  • Want to sell 25% of your cell phones bandwidth peer to peer at current market prices? Place the order. When the paid for, the buyer automatically gets a “smart” receipt that sends itself to their phone which then allocates the bandwidth (or MB’s).
  • Starting a company? Post the proposal on a incubator forum for say $200. Use all the feedback to refine the business plan. Estimated fair value is about $20,000. So on your blog (your node) offer 1,000 shares at $40 / share and have the price drop $1 / day. People will start buying at maybe around $25 / share and buy the last available shares at $18. Now the shares are trading freely at $18. The company can buy back the shares at any time.
  • Starting a local currency or script? Same process. The currency can be backed by gold, bulbs, hours, or just be fait.
  • Want to trade one currency for another. Just place the order.
  • Say you are driving to the mountains and wonder what conditions are like 2 kms forward. There will likely be people indicating exactly what conditons are since it is profitable to them. The Universal Transaction Engine lets one specify any location and note the conditions. Or people can simply post the conditions and be paid for it. People anywhere can simply hook up any sensor and start selling the data.
  • Want to know the current supply and demand of office space, organic vegetables, jazz music, digital storage, almost anything, in the system? Simply look it up. That level of research is currently costly and time consuming.
  • A student could pay their way through an African walkabout by employing a quick look at demand for African songs and dances and record the most wanted.
  • Schools can easily create phone trees for communication and emergency use. Our current system is only a one way broadcast. There is no structured way for a parent to signal for their kid to be picked up by a neighbor.
  • Easy to set up a private or public focus group. The point is to have a scarce resource for people to back their selection of a few items from many candidates. AND whoever picked the successful items gets more compensation over time.
  • “Famous” people can publicly state that they respond to queries that are backed by a minimum amount of money, or from a person who has a minimum rating. (FaceBook is just now very crudely experimenting with this.
  • StreetLine raised $25 million for the ability to monitor parking space availability. “… thinking about how to effectively package Streetline data for other kinds of customers, such as “the Googles of the world.”” That’s indirect. Castpoints connects supply and demand directly, offering the best realtime value to users (private, city, sporting events, BART, etc.).
  • People want to ship fish from a port to a town, but their are problems. Who pays? If the contract specified that the fish source is to prepare the fish for transport and doesn’t, the transporter collects from the seller. If the road suddenly washes out and the fish spoil en route, both the shipper and receiver split the loss since neither one made a mistake. Both will likely have insurance, minimizing the impact. Also, both have the option, like everyone, to only transact with people how have enough of a performance bond, or insurance to cover problems.
  • A reporter checks topics in an area of expertise and finds that demand is high right now but quality seems low. Reporter finalizes fact checking and posts article at a cost of 100 gAg. A) Success! Other’s give article high value ratings with conviction. When dividends are paid at the end of 7 days, the reporter is paid 125 gAg. B) No so successful. Other’s give article low value ratings with low or high conviction. When dividends are paid, the reporter is paid 50 gAg. The reporter can study replies for constructive criticism, and rate a few good ones.
  • Proofreader replied to newsletter poster about a few typos with a value rating and zero conviction. The newsletter poster replies to the proofreader with a high rating and some conviction. This particular forum uses settings that if a poster has a rating of over 75% but zero conviction, the site pretends the poster has a conviction of 10 gAg. So with zero money down, the proofreader makes a bit of money after 7 days from this “marketing cost”.
  • A middle person sees a post on a small website they think has a lot of value. They promote it to a large website at a cost of 1,000 gAg. A) Success! The middle person gets paid 1,200 gAg in 7 days, and the original poster gets (say) 100 gAg due to their use fee of 10%. B) Not so successful. Middle person gets paid about 700 gAg (loses 300 gAg), and original poster gets about 70 gAg due to their use fee of 10%.
  • My daughter is home sick today with a 102.3° temp. If our school was using this system, and was connected to the CA school system (optional), which was then connected to the USA school system (optional), then the world (optional), etc… The parent, not the school admin (reducing costs), would indicate the absence and reason (temp 102.3° F). Data is aggregated and distributed, so privacy is protected. Anyone could in near realtime see the absences and reasons (barf, avg temp, etc.) at any level (county, state, nation, world, etc.). (Raw numbers are likely free, nice statistical maps and historical data, probably not free.) With zero changes, because it’s user’s own content and categorization that creates the context, the Castpoints framework works for GDP, soil conditions, health records — basically any supply, demand, and transactions of anything, and people own their own stuff and privacy is built in. This is completely at odds with (and will subvert 😉 the typical Facebook model where the aggregators own the users information. A current example: K-12 student database jazzes tech startups, spooks parents.

Castpoints Internal Structure
Infrastructure costs are minimized by heavy use of distribution, very asynchronous communications, and retaining minimum amounts of data. CP avoids storing content, and can run on a cell phone.

Universal Trading Engine
An offer consists of a category, a title, optional tags, and stipulations. All specifications must be met to execute transaction. Everything is dynamic and optional, so the local traders themselves optimize the organization and level of detail that maximizes added value to them.

  • Order types: want or offer, at a limit price or better.
  • Time in force: A start time, and stop time. And if it repeats. Minimum is, say, 12 seconds. The system ques transactions to be executed in 6 second intervals. This HUGELY reduces the need for big servers.
  • Orders can be published anywhere, but the transaction and fees happen at the CP node that offers the resource.
  • Category. If existing categories are not appropriate, the trader simply adds one. As long as the market finds it valuable, it will stick, otherwise it’s automatically deleted.
  • Order titles capture about 75% of the order. Say people want to trade a few redwood 2” x 4” x 8’s. If the title is already present, the person just uses that phrase. If not, the person enters the category and redwood 2” x 4” x 8′. The market determines which mix of title and tags are optimal. Dynamic titles allow for rapid adaptation to changing conditions. Unused titles are deleted.
  • Tags are general and can describe almost anything.
  • Although value can be displayed in any currency, base currencies are Joules, and ownership of events.
  • Dynamic limit price: Current order price, min and max transaction price, scale price increment, scale time increment, max time increment.
  • Dynamic unit price. Prices can be set up to automatically change based on supply and demand of the underlying unit. So if a person can make one dresser per day but people are buying 2 dressers per day, the price will automatically increase until only one dresser per day is sold. But, say, after holidays, people don’t want dressers, the price will naturally drop to the builders minimum price. Conversely, people buying dressers have a max price. This uses the same supply and demand equation as determining a cost of posting in a new thread.
  • Location: Latitude, longitude, and possibly altitude supersedes street address. For privacy, pre-transaction could use fewer significant figures so people don’t know where you live. Post transaction would reveal the exact location to shippers, etc.
  • Possible stipulations: Shipper, shipping conditions,  insurance, performance bond of all parties at least X% of item value, shipping pick up / delivery time window, shipping temperature range, etc.
  • When the transaction is executed, a receipt is generated that can trigger other actions in other applications.

Structure
Responsibility, accountability, and roles are formally organized and based loosely on the standard Incident Command System. Participating in a structure means that people make agreements that include amends. For starters, people agree to do all they say they will do, and not infringe on others or others property. Specifics will be tied to a role’s tasks. Agreements will be short and clear or else people will go elsewhere. Nobody wants to actually read legalize on a cell phone when they have real money on the line.

The fractal hierarchy tree is flexible and can expand, contract, and adapt rapidly. Basically after about 6 people are added to a node, another node is automatically suggested in the areas of Operations, Planning, Logistics, or Finance / Admin. These roles are dynamically defined and managed by the people who need them most which dramatically reduces information overload.

A person can be part of many structures. Their neighborhood, school, local community, multiple friend / interest based groups, etc. In other words, people will have a place to belong which builds community.

“Nature bats last.” Castpoints structure is created as a byproduct of what people are doing, and trying to do. Nobody has to design a company organization chart; the company’s members actions create the chart. Theoretically:

Any organization that designs a system (defined more broadly here than just information systems) will inevitably produce a design whose structure is a copy of the organization’s communication structure.Neil Schulman’s 10th of June post may also be alluding to Conway’s Law

Practically: Apple: America’s best retailer, by Jerry Useem:

“One of the best pieces of advice Mickey ever gave us was to go rent a warehouse and build a prototype of a store, and not, you know, just design it, go build 20 of them, then discover it didn’t work,” says [Steve] Jobs. In other words, design it as you would a product. Apple Store Version 0.0 took shape in a warehouse near the Apple campus. “Ron and I had a store all designed,” says Jobs, when they were stopped by an insight: The computer was evolving from a simple productivity tool to a “hub” for video, photography, music, information, and so forth. The sale, then, was less about the machine than what you could do with it. But looking at their store, they winced. The hardware was laid out by product category – in other words, by how the company was organized internally, not by how a customer might actually want to buy things. “We were like, ‘Oh, God, we’re screwed!'” says Jobs.

But they weren’t screwed; they were in a mockup. “So we redesigned it,” he says. “And it cost us, I don’t know, six, nine months. But it was the right decision by a million miles.” When the first store finally opened, in Tysons Corner, Va., only a quarter of it was about product. The rest was arranged around interests: along the right wall, photos, videos, kids; on the left, problems. A third area – the Genius Bar in the back – was Johnson’s brainstorm.

Valuing Non Scarce Resources
Basically a value based rating system with feedback. People select where to post there valuable content based on supply and demand and estimated ROI. Marc Stiegler’s 1999 science fiction book, Earthweb, coined “castpoints” as a way for humans to manage billions of real time suggestions dealing with incoming marauding aliens. He graciously gave permission to use the term “Castpoints”.

“…how do you spot a good idea or a good forecast? Obviously, you make people put their money where their mouths are. Let them back a forecast with real bucks, and the serious ones will go for it, while the rest just hang out in the chat rooms. No muss, no fuss. No debating. No mediocre compromises.” — Marc Stiegler

  • Posters of valuable content earn money and build reputation.
  • Those who successfully challenge non-truths, or posting of stolen property, get paid.
  • Valuable content is automatically promoted to higher levels of visibility and revenue by others – because it’s profitable to all involved.
  • Real time supply and demand info highlights what the market values so content posters can deploy resources efficiently, while content consumers can narrow their focus.
  • Private performance bonds are built in.
  • Conflict resolution is built in and handled quickly and profitably by local experts.
  • Deterrents and amends result from contractual consequences, not fiat force.
  • People actually want advertisers to participate. People will either be informed of valuable products, or get some of an advertiser’s cost to post.
  • Advertisers want to participate because they get sales and or valuable feedback.
  • Most variables self configure based on supply and demand.
  • Money enters via:
    • Posting a new thread.
    • Rating any post.
    • Voluntarily, publicly, and verifiably – paying for use of content. (a small part)
  • Money exits via payments to:
    • Dividends to value adders.
    • Transaction fee to forum owner.

Historical Perspective

Most new projects in the realm of crowd sourcing and prediction markets march toward the nexus of Castpoints. Early efforts are basically futures markets, burdened with regulations, high specificity, and derivatives. Recent efforts work around this by applying aspects of free market economics to a particular project. Stepping stones:

  • Idea Futures, 1995 Wired article by Robin Hanson.
  • Google. The main idea is to rank content on how others value that content. This is indirect and allows others to game the ranking system. Castpoints is immune to gaming since the posters rank information directly.
  • The U.S. Idea Futures Exchange (USIFEX) (defunct?)
  • The Foresight Exchange Prediction Market
  • Allvoices. Payments seem arbitrarily chosen and it appears the revenue model is ads all over their site.
  • Kickstarter Has “rewards” for helping fund projects. Very vertical; seems to work.
  • Hitrecord. Open collaborative production company. Looks fun.
  • http://www.consensuspoint.com/ Looks well done and seems to be the leader now (interesting examples). Robin Hanson is the chief scientist. It seems rather vertical. Many “market parameters” are reportedly fine tuned and or have oversight. Castpoints adds private performance bonds, conflict resolution, generality, natural hierarchy. It appears people bring info to Consensus Point to be securitized, while castpoints securitizes info at, and by, the source.
  • The Collaborative Lab gets it!!! Check out their chart on The Big Shift, and Welcome To The New Reputation Economy by Rachel Botsman
  • The apparent success of Gumroad validates the idea of simple peer to peer sales (node to node), and lets value adders not deal with hosting, payments, and delivery. However, conflict resolution is the traditional indirect model of working through the company, there does not appear to be a reputation system. It seems to be a great step in the Castpoints direction.

Litmus test 1: Do criminals find it useful? Yes: From crowdsourcing to crime-sourcing: The rise of distributed criminality.
Litmus test 2: Is it fun? Consensus Point’s GE example noted how participants had fun. This is a critical point. When people are having fun, they are doing what the love to do and are intrinsically motivated do it well.

Publishers pay to post a new thread. They use realtime estimated ROI’s to publish where they will likely be profitable. Publishers can also conditionally publish so that the post is only published if specific criteria are met. Such as a minimum estimated ROI of 25%.

Consider the “Current Costs To Post New Thread In…” sample screen shot.”

current post cost jan 29 2013

  • Category: The different forum labels. If a forum was all about birds, the categories could be, “Northeast Birds, Southeast Birds, News, Bird song, etc.”
  • Current publishing cost: The cost to post a new thread immediately. Formula described below.
  • Mean value rating %: The rating for all posts in a category. The lower the rating, the more a valued post can earn. If the number is high, a post has to be pretty valuable just to break even.
  • Estimated ROI based on publisher’s current rating: using the current cost to post, and a posters current rating in that category, the estimated ROI is shown with a confidence interval of 90%.

… and then fill out the publishing form to start a new thread:

submit post cost jan 29 2013

The Challenge category is used to formally question a post’s assertions, or an entity. Participation is required, or else challenger wins.

The (maximum) use fee comes into play if much or all of the post is republished in full (promoted). This is the max percent of all income the original poster gets from any republishings. If a arbiter thinks a post is good, they can take the risk and or reward of republishing it on a big site where the post costs are high. The lower the max use fee percent, the more likely, the post will be republished.

New post cost is automatically determined by real time supply and demand: Last post price + STD( last 30 publishing prices ) * the average time between last 4 posts [basically it the next post is sooner than the average, it costs more; less than the average, it costs less]). (And things like a Minimum Maturity Level: Anyone, teens, grown ups, other.” since it can finally be enforced.)

Copy-Done-Right (for non scarce resources)
Instead of hat tips and not being able to easily pay people for value, people can credit a poster directly. Say an old post has a max use fee of 10%. If a new post uses 5% of that old post, the old post receives 5% of the new post’s income. If a new post uses 10% of that old post, the old post receives 10% of the new post’s income. If a new post uses > 10% of that old post, the old post receives 10% of the new post’s income. This is how something self-defines as “commercial” or “non-commercial”. If it’s valuable enough to make income it’s commercial.

Example: A 500 word post quotes 11 words (2.2%). Clicking the “Credited…” link will verify the basic stats of the transaction.

… A problem with science, then, “isn’t that most experiments fail, it’s that most failures are ignored.” (Credited 2.2% to Seraphina Fox) It’s challenging to ignore valuable information when money is involved…

Others can optionally rate what posts are worth to them.

  • Republish credit is the info that is attached to a post that allows Castpoints to know who to pay based on their indicated use fee percentage.
  • “% Valuable” is what percent of the post the rater deems valuable and or adding value to the thread.
  • “Conviction” Optional. Indicates how strongly the rater feels about their rating. As in life, currency units can be anything. The numerical values range from 1 to the max of (highest the user has used in the past month, or the highest on the post so far). The scale rises exponentially for about 15 specific numerical choices. ~$x = exp( ( log( $row[max_reply_conviction] ) / 6 ) * $i ).

A rated post’s subject and author lines displays simple initial statistics:

Misinterpreting Value Is Easy 84%, 2 days ago.
By Jeff 80%

“84% V” is the conviction weighted median percent value rating: people decided that 84% of the post is valuable by putting their money where their mouths were.

Weekly Payments From Rating
Every 7 days after a post, and indefinitely as long as republishing and or replies continue, the value adder gets paid. The formula is the product of a poster’s value ranking and total conviction, with distribution skew balanced at 50% of a thread’s mean value rating. If a thread mean rating drops to say 45%, the distribution skew rises to pay out 5% more to posts rated above 50% which attracts more valuable posts. It is easy to identify where a little value can make relatively large returns.

Any value in inactive accounts (over 1 year with no push activity) is put into the dividend fund.

Conflict Resolution, Private Performance Bonds, Insurance
Insurance was apparently a key aspect of the initiation of modern commerce. Against the Gods: The Remarkable Story of Risk documented this well. Basically England’s ships needed investors to share the risk in order for trade by ships to take hold. The cost of a lost ship was just too great to be bourn by 1 or 2 people.

In Castpoints, each node, or person, has a performance bond that is funded by withholding about 10% of each transaction up to a safety factor of 3 which is based on an average of industry standards. So if a person loses a challenge, their escrow account is out 1.5 times the transaction that was challenged.

Posts that don’t follow a sites contracted rules of conduct can be “challenged” by anyone with a performance bond account greater than the challenged. The basic contract for each party: (Partly from Richard Maybury.)

  • Do all you say you are going to do.
  • Don’t infringe on other people or their property.
  • Make the difference between fact, and non-fact, clear.
  • Be able to back up facts before posting them.
  • Make amends by cleaning up inevitable mistakes.

This is strict…

  • NOT challengeable: “I think people will love the taste of this new recipe.”
  • Challengeable: “People love the taste of this new recipe.” Better be able to show proof within 6 weeks, otherwise don’t post.

Conflict resolution:

  • This has nothing to do with inefficient “precedent”, nor “punishment”, nor “laws”. Either a contract is honored, or not.
  • A “challenged contract” case is settled within 6 weeks.
  • If the challenged does not respond, they default.
  • Resolvers are self selected and post either “Did Not Honor Contract” or “Honored Contract” with reasoning based directly on verifiable facts.
  • A resolver’s post can also be rated, commented on, and “challenged”.
  • It only takes one resolver’s decision. If more than one resolver posts, 75% need to agree, or the challenger is held responsible. If no resolver posts, the challenger is held responsible.
  • If the challenged is found NOT responsible, the challenger’s performance bond pays the challenged the 1.5 times amount of the disputed transaction. If the challenged is held responsible, their performance bond is pays out 1.5 times the disputed transaction.
 If the challenger is not the entity who owns the property, the property owner and challenger split the payout 50:50. (People can challenge someone on behalf of someone else.)
  • Resolvers basic rules: Only consider independently verifiable facts. Another resolver has to add value, not just a “me too.” Otherwise they can be challenged.

The problem is this would have A LOT of money just sitting around — which is a tempting target. To mitigate that, nodes can offer a percent share in the revenue stream for a percent share in liability in case they lose a challenge. Now it’s easy and simple to see how “trusted” a node is – just look at their dividend, stock price, and float. Anyone can ride on the coattails of a trustworthy node and make a small amount of money.

Insurance contracts compete via the universal trading engine. People in the middle of nowhere can offer insurance, and also get insurance. This is also made possible in part because the abstraction layer of the universal transaction engine allows for many insurance contracts to be a commodity and therefore easy to trade.

When people trade with conditions like shipping, etc, they can also add a condition of insurance. So as node A (producer) is on their 2,000th shipment to node B (user) via node C (shipper), node D (insurer) can actually calculate the amount of insurance based on past shipping problems. 2 MAJOR things to note: This info is (mostly) public, so anyone can calculate the insurance. And this info is so easy and accurate to calculate, it can be automated. So potential shippers can set up the universal transaction engine to automatically offer insurance at a specific price or better dynamically. In trading there are market makers — historically it was/is a lucrative position due to direct access to the raw data flow. For resources that have a lot of uneventful transactions, the whole thing can be automated in real time and still be win-win for all involved. Meaning these types of fixed costs fall to the minimum mathematically possible.

Money Laundering
Almost impossible to do on a large scale because all money goes into the dividend fund and is distributed by merit after a 7 day time lag. If participants try to create an overly large dividend on a small forum, that will quickly attract arbiters which defeats the purpose.

Criminality
At some point the pros of ignoring ever bulging red tape (regulations, laws, permits) become greater than the risks of ignoring them. This creates the opportunity, corruption and danger of grey and black markets.

The unofficial economy easily competes with the official economy because it has much less overhead.

It’s simple arbitrage: more red tape creates greater profit opportunities, which infuriates the “kings” who respond with more red tape controls, which creates even greater profit opportunities until enough of the real economy eclipses the controlled economy and the “king” loses power.

Castpoints is a self-correcting system that minimizes parasitic and criminal behavior BECAUSE it is maximizing ALL human potential. However, all complex systems have some parasites and are a bit messy because healthy systems have friction, aka, choices.

Systems use feedback loops and control structures to manage themselves (growth, communication, conflict, etc.) In Castpoints, the “control” mechanisms are transparency, reputation, agreements backed by performance bonds, localized decisions by stakeholders, and basically no barriers to entry. Therefore, there is no systemic and significant economic advantage to operate outside of the castpoints system. In other words, Castpoints is how nature works: it has no competition. It provides and manages a level playing field for trading any resource.

Privacy And Reputation
People own and control their info. Typically, unless otherwise indicated, a node can only see info up to 2 nodes away. Further than that, nodes can only see summarized data (usually only if there are at least about 30 data points). People can associate specific info with a URL link (NetRep) to reveal different data views to, say, accountants, the public, a specific interest group, other castpoint accounts, etc. The link in an email would be something like:

text, text, text, text.
Thanks, Jeff
https://www.castpoints.com/v.php?v=43214

“Taxes”
Taxes are win-lose fiat decisions and so not used. CP employs “use fee” agreements at the point of sale. These fees are preferentially tied to a node’s physical location and automatically paid to the local borough as part of the contract to live in the borough. Boroughs, cites, states, etc. compete with each other like Neil Stevenson enclave’s. By default, each node can only spend and receive use fee money within it’s node plus or minus one level. So a city can only trade and contract with residents, and or the county. The county can only trade and contract with cities, and or the state it’s within. Details.

Challenges
Regulatory burdens, laws, and central banks are the main challenge. The are all based on the idea of the devine right of kings, aka win-lose relationships. Castpoints, and many other collaborative consumption endeavors, are based on agreements, aka win-win relationships. It’s unlikely the status quo will acquiesce to the competition. Economically, the flow of capital changes from moving from debt (slaves) toward credit (master), to flowing between sovereign individuals (freedom, prosperity).

This is happening in New York City where Airbnb’s business model is “illegal” possibly because hotels spent “millions” protecting their market (passing laws, etc), instead of bettering their product. Airbnb participants spend their money offering valuable products that are often unique. More.

What works better?

  • Expensive regulations that have serious systemic flaws as evidenced by the mortgage fiasco, MF Global and allegedly corrupt CFTC regulators that go uninvestigated.
  • Transparency and reputation that apparently have no overtly notable reported problems after 10 million transactions world wide (other than annoying the status quo), and are incredibly cheap.

Intrade shuts out American bettors …due to legal and regulatory pressures, Intrade can no longer allow US residents to participate in our real-money prediction markets… U.S. regulators on Monday sued Intrade, saying the company illegally let customers bet on options that must be traded on regulated exchanges.”

Yet, the opaque 600 trillion Over-The-Counter is mostly unregulated. Probably because this is a large arena where the “too-big-to-fail/jail” banksters operate. On the basis of the world’s 80 trillion GDP, the OTC market is levered by at least 7.5 times with minimal margin.

In aligning with Pareto’s 80/20 Principle, Castpoints focuses on maximizing human potential using about 80% of best practices. Not everyone will be happy, at first 🙂 All complex systems contain parasites. (Healthy systems have friction [choices])

Edge_of_Chaos

Psychology
Castpoints reduces fear in many ways by naturally reducing unknowns while increasing support. When there are many unknowns, and or the environment is not perceived as safe, people naturally hold back and get defensive.

  • Putting a cross cultural price on options allows one to compare apples to apples.
  • With little risk, a person can try new things out. For example, if a person sings a song, they can post it for very little cost to a tertiary music site basically anonymously and see what happens.
  • Transacting with others becomes very safe: A person can check out past judges and outcomes in completed conflict resolution cases; can transact only with people who have a sizable performance bond; know that feedback will mostly be very helpful, while unhelpful feedback will be pointed out by *others* (meaning the budding singer won’t have to defend their self).

Positive things flow once everything have a specific price, and people are held responsible for their actions. The more people use it, the more they benefit. In other words, castpoints is literally self directed, and self paced, therapy.

Speculative Evolutions

  • Get the thing done!
  • Addition of sophisticated statistical analysis and pre posting decision trees and keywords via open architecture.
  • When enough momentum to support money changers is present, currencies and scrips will compete freely. (monetary freedom)
  • After an email plugin is available, people can conveniently rank their email by how much conviction senders put behind it, (spam dies).
  • People start realizing that non Castpoints resource management simply can’t compete with resource management facilitated by Castpoints. (Reason accelerates the death of devine right of kings.)
  • To be more useful, capital will likely move closer to transaction points (away from central banks and debt). Yet due to the Singularity’s exponential advance, money just sitting around becomes glaringly inefficient. So each Castpoint entity could offer dividend paying stock in return for performance liability. This dramatically increases the velocity of capital. (trading decentralizes)
  • Centralized control simply can’t keep up. The differentiation between a companies customer service, intranet, product, and or service becomes blurred in a Castpoints framework. The definition of an employee will also blur: who’s managing the FAQ’s, suggesting valuable ideas, finding bugs? Could be anyone. Add the pressure of “politicians” being asked to use Castpoints and constantly losing money. People could realize centralized politics (control) has a lot of friction (expensive, slow, corrupt). (ability to add value transcends hierarchies, labels, identities, and roles. (Not outsourcing: all sourcing))
  • What people put out returns very directly in a measurable and honest way, which provides helpful feedback about behavior. Meaning: we learn to critique in supportive ways while increasing everyones’ psychological sanity. (auto-self-actualization)
  • Sovereign Individuals become their own central stores of value while doing what they love to do and do best. They are distributed, localized, and expert profit centers backed by performance bonds.

A Provisional Patent was filed on June 4th 2012. (and expired 🙂
“Castpoints: A method that securitizes information directly, via self regulating: winnowing and promotion of value, conflict resolution, reputation, and private performance bonds.”

Going to extremes…
Why do people die? As far as I can tell, there is no agreement on why people need to die. Do you know of one?

Suppose one purpose of death is to give souls a fresh start because their rate of adaptation was not keeping up with evolution in general. Therefore, if people were able make better decisions faster than required for evolution, and were able to quickly let of of what doesn’t work, the body could then reflect this by regenerating faster then breaking down.

January 26, 2013

Critiquing: “The sharing economy wants to play with the big kids — is it ready?” by Greg Hanscom

Filed under: Castpoints, Editorials — Jeff Fitzmyers @ 9:06 am

This is one of the first articles I have noticed about Collaborative Competition meeting the status quo.

A quick gander at the site’s New York City listings last month led the travel news site Skift.com to conclude that more than half of them were in violation of state law [21 pages of unintelligible “stuff”]… Airbnb’s response, via its global head of public policy, David Hantman: “We can’t possibly keep up with the law in all the cities…”

This is true. Just go to any county library and ask to see the section for local county and town laws, regulations, rules, etc. In the case of San Luis Obispo County’s area, where my Business Law teacher sent our class years ago just for this purpose, there were literally thousands of books. “As of 2010 the Federal Register [all the federal regulations for businesses] was 81,405 pages long.” That is 160 reams of paper; 850 pounds of paper; $1,300 for the cost of the unprinted paper; 27 foot high pile of paper.

But Airbnb’s strategy of pleading ignorance or powerlessness in New York, one of its biggest markets, doesn’t exactly add up: Here the company actively lobbied against the very rule that so many of its users are apparently [allegedly] flouting.

I skimmed the “rule” that runs 21 pages and don’t understand it. “…natural person or family for 30 consecutive days or longer (the permanent occupants)…” Talk about complexity, a whole lot of legalese: Would not “the permanent occupants” be a natural person and or family? Why pick “30” days? Why not 29, or 31? Is that number arbitrary? Is the cost of figuring all this stuff out worth it to all involved worth it?

Arun Sundararajan, an associate professor at NYU’s business school, wrote in Wired in October that reputation systems … and the transparency of the web make regulations obsolete:

After all, profit is a much more powerful driver for quality than regulatory compliance. If your last customer — one who has been vetted by others and has built reputation credibility — complains about the hygiene levels of your shared lodging, your future business prospects on Airbnb are pretty bleak.

Who better to discern hygiene than the omnipresent renter who also has their reputation on directly on the line. Inspectors are not around all the time and answer to the city, not directly to the people on either side of the transaction.

Even though in “2011 as the [NY City] issued 1,897 violations”, it’s trivial to ascertain that 3,200 [current rentals] are illegal under New York law. Predictably, criminalizing something that has value just makes people go underground breaking more “laws”. “…With Toshi, they’re looking at online false advertising as part of their lawsuit…” What good is a “law” that is selectively enforced “New York hosts have generally not been targeted for enforcement.”? Who decides who enforces the law against whom?

I suspect plenty of web-savvy customers share my trepidation at relinquishing the safety of dinner to the handful of anonymous netizens crazy enough to obsess over an online kitchen livecast. While many of these regulatory battles do smack of governments protecting old industries that are “disrupted” by the new sharing model, there are often good reasons that these rules exist.

There is always the option of the “legal” hotels where one will pay more money for “safety”. Obviously safety and hygiene are important. The question is, what works best in in those regards? Airbnb states their have been over 10 million nights booked. The 2 articles referenced alleged ZERO problems between people who want or have a room for rent. The only listed complaint was a single one about over crowding. Most complaints reportedly came from “residents”.

“I don’t think sharing economy companies are anti-regulation at all,” Turner adds. “The question is what’s reasonable.” That’s a politician’s question so that they can manipulate and coerce everyone to “compromise”. The question is what works, and what is valuable. At the end of the article is a possible answer:

“But you [sharing economy companies] are a threat to existing industries, and these companies spend millions and millions to protect their market share from each other and anyone from the outside.”

Rentals that spend their limited “millions” to protect their market, instead of bettering their product, are competing with rentals that spend their money on offering valuable products that are often unique. Which is proving more adaptable to the market?

If sharing economy wunderkinds can’t get their acts together and face regulation reality head-on, they may watch their profits decline and lose traction in the battle to make collaborative consumption a societal norm.

Seems like it’s the opposite. Regulations are just another hidden tax and are subject to corruption, regulatory capture (more), selective enforcement, unintended consequences, etc.

[Regulations] cost the [US] economy nearly $2 trillion a year… $15,000 per household… This year alone (2011), 50,000 pages of new regulations have been added to the Federal Register… One frustrated banker said it takes 20 percent more employees to deal with all the paperwork to comply with regulations than it does to work on loans… “Miniature horses are now service animals. So restaurants and airplanes have to allow mini-horses on…”

What works better?
• Regulations that are expensive, and have serious systemic flaws.
• Transparency and reputation that apparently have no overtly notable reported problems after 10 million transactions world wide (other than annoying the status quo), and are incredibly cheap.

Update January 28

Startup dreams meet pop-up rentals The newcomers already have broken the laws around taxi services (with apps that allow anyone to be a cabdriver), music (their first CDs came free off Napster) and hotels (they often stay in untaxed AirBnB rooms), so zoning codes are just another institution to drag into the 21st century. To them, occupancy limits are like copyright laws – simply obsolete.

Wait, there is a big difference between ignoring things that don’t work (laws about taxis and hotels), stealing (music, copyright), and indirect fiat (zoning). “In many ways, pop-up housing is a necessity, even as some worry that these illegal arrangements could lead to abuse or unsafe conditions.” And yet no abuse or unsafe conditions are reported in the article. The difference is that there are plenty of choices available so the only reason to be part of a bad situation is psychological baggage.

“If San Francisco will not build enough new units, they will invent them.” Lead follow, or get out of the way.

Scam complete: the US government takes a page from Diocletian’s book… …An important lesson from history, and a trend that has been repeated numerous times… governments will stop at nothing to keep the party going just a little bit longer… With a debt level over 100% of GDP, the US is so broke that the government must borrow money just to pay interest on the money it’s already borrowed. They’ve lost over a trillion dollars a year since 2008… As with any good scam, the government must maintain public confidence… Dissent must be vigorously and swiftly pursued. So when S&P finally downgraded the US one notch in August 2011, the SEC and Justice Department announced that S&P was under investigation, just two weeks later… Egan-Jones, a smaller rating agency, has been even more aggressive, downgrading the US credit rating three times in 18 months… In a country that churns out thousands of pages of new regulations each week, it’s easy to find a reason to go after someone… In the case of Egan-Jones, the SEC brought administrative action against the agency within two weeks of their second downgrade. And a few days ago, the case was settled… Egan-Jones is banned for the next 18 months from rating US government debt. They’ve effectively been silenced from telling the truth.

July 28, 2012

Piers Corbyn’s 42 day old weather forecast more accurate than 12 hour traditional forecast

Filed under: Editorials, Systems — Tags: , — Jeff Fitzmyers @ 10:09 pm

So who understands the system better? Gov funded huge computer farms and computer models compared to one private person? Funny how people, who might be trading grains 😉 continue with traditional weather forecasting.

Mr. Corbyn’s post:

Piers says “We are very pleased. We made one forecast and one forecast only 42 days ahead and our call was for thundery downpours likely, based on predictable aspects of solar particle activity and lunar modulation.

The Met Office made many forecasts based on shed-fulls of computing power and deluded Co2-warmist meteorology funded by shed-loads of taxpayers money. Their last call was for dry.
The power of our physics-based Solar Lunar Action Technique was confirmed by serious thundery downpours in many places and one hit the ceremony. The failure of standard meteorology earth-centered ‘models’ in the face of WeatherAction predicted solar-driven ‘Red warnings’ is laid bare.

Related:
+ Soy verses corn Commitment of Traders
+ Apparently real weather forecasting! (up to 85% correct)

Updated Dec 2014
Check out this wonderful chart of weather models vs. observations.

Update Feb 5
GloBull Warming: It Is A SCAM
Climategate, the sequel: How we are STILL being tricked with flawed data on global warming

If humans make the majority of CO2 that’s magically such an issue, why is the red not concentrating over populated areas?

BrianOCO2Image1720405

June 27, 2012

A steady way to prosperity: Timber (update 2, July 15)

Filed under: Editorials, Just Watching — Tags: , , — Jeff Fitzmyers @ 11:33 pm

I wanted to highlight some info Dr. Steve Sjuggerud recently posted via The Most Accurate Investment Forecast Ever because I love the idea of selling options on Timber: An Excellent Retirement Vehicle.

On December 31, 2001, Jeremy Grantham issued a 10-year forecast [on] 11 different asset classes… He got the order almost exactly right… It may be the most accurate 10-year call in stock market history…

How does Grantham come up with these predictions? … His firm “predicts asset class returns in a simple and apparently robust way: we assume profit margins and price earnings ratios will move back to long-term average… from whatever level they are today.” … “These estimates are not about nuances or PhDs. They are about ignoring the crowd, working out simple ratios, and being patient.”

So what’s Grantham predicting today?

Grantham predicts that over the next seven years, bonds will lose money (after inflation). He predicts that managed timber will be the best-performing asset class, followed by emerging-market stocks.

This PCH move today spurred me to highlight timber again. The dividend is currently around 4%.

The monthly shows price to be closer to the bottom of it range than the top.

Update June 29 2012: Pretty good for a boring timber stock!

Update July 15 2012: The July 30 put sold for $64 is far out of the money 😉

June 25, 2012

Antifragile securitization of info could advance communication, freedom, conflict resolution, prosperity and anti-manipulation

Filed under: Editorials, Systems — Tags: , , , , — Jeff Fitzmyers @ 11:39 am

Superseded by Castpoints: Using Nature’s Economic Paradigm To Manage All Resources Resulting In Win-Win Transactions.




Universal issues: Non-payment for adding value, info overwhelm, rampant non-truths, trolls.

Marc Stiegler’s 1999 science fiction book, Earthweb, coined “castpoints” as a way for humans to manage billions of real time suggestions dealing with incoming marauding aliens. He graciously gave me permission to use the term “castpoints”.

CASTPOINTS is likely the next major step in digital communications. It unites Kurzweil’s Singularity, Davidson’s Sovereign Individual, and Taleb’s Antifragility, via self regulating plugins for WordPress, Facebook, email, etc. It uses an optional cost to post for: paying value adders, conflict resolution, private performance bonds, winnowing and promotion of value, making untruths expensive (via paying untruth finders), all as directly as possible based on transactions and feedback loops, not opinions. People WANT to pay to post valuable info because the more they add value, the more they can profit and build their reputation, and it’s fun!

Castpoints (PATENT PENDING) levels the economic playing field by superseding indirect revenue models like ad’s with direct compensation for adding value. Therefore, most can profit safely, while fossilizing trolls, lame ads, poor info, info overwhelm, and spam.

Control and capital automatically flow from centrally controlled debt slaves and masters, to better decision makers, engendering thriving sovereign individuals.

1) ATTRIBUTES

  • Hierarchical control systems are superseded by distributed, emergent, localized self-correcting stewardship.
  • Posters of valuable content earn money and build reputation.
  • Those who successfully challenge non-truths, or posting of stolen property, get paid.
  • Valuable content is automatically promoted to higher levels of visibility and revenue by others – because it’s profitable to all involved.
  • Real time supply and demand info highlights what the market values so content posters can deploy resources efficiently, while content consumers can narrow their focus.
  • Private performance bonds are built in.
  • Conflict resolution is built in and handled quickly and profitably by local experts.
  • Deterrents and amends result from contractual consequences, not fiat force.
  • People actually want advertisers to participate. People will either be informed of valuable products, or get some of an advertiser’s cost to post.
  • Advertisers want to participate because they get sales and or valuable feedback.
  • Most significant variables self configure based on supply and demand.

2) HISTORICAL PERSPECTIVE

Paul Rosenberg: “… if you get something you value, one way or another, some time or another, you should pay for it… But many people won’t, and we simply do not have a mechanism for incenting the voluntary compliance … It’s a real problem.” [until castpoints]

“I see reputation managers as core to the success of the Web… Quality assessments must become an explicit component of most Web user interfaces.” – Jakob Nielson

“The path to maximum prosperity will depend on finding ways to build economic systems in which new niches will generate spontaneously and abundantly.” – Stuart A. Kauffman

“The [Intrade.com] markets offer a great way to track the market-based consensus on political and current events. People put real money on the line in making predictions, which is better than snap judgments in opinion polls or no-stakes views of pundits.” – Tom Gallagher, ISI Group

Most new projects in the realm of crowd sourcing and prediction markets march toward the nexus of castpoints. Early efforts are basically futures markets, burdened with regulations, high specificity, and derivatives. Recent efforts work around this by applying aspects of free market economics to a particular project. None of them are integrated with performance bonds and conflict resolution, two critical components needed for a complete system. Castpoints is general enough for use in most content situations, complete enough to cover most situations, and (aside from the money part) direct, simple and boring enough to be hard to regulate. Stepping stones:

  • Idea Futures. 1995 Wired article by Robin Hanson.
  • Google. Aparently the main idea is to rank how others value information which then allows others to try to game the ranking system. Castpoints is imune to gaming since the posters rank information directly.
  • The U.S. Idea Futures Exchange (USIFEX) (defunct?)
  • The Foresight Exchange Prediction Market
  • Allvoices. Payments seem arbitrarily chosen and it appears the revenue model is ads all over their site.
  • Kickstarter Has “rewards” for helping fund projects. Very vertical; seems to work.
  • Hitrecord. Open collaborative production company. Looks fun.
  • http://www.consensuspoint.com/ Looks well done and seems to be the leader now. Robin Hanson is the chief scientist. It seems rather vertical. Many “market parameters” are reportedly fine tuned and or have oversight. Castpoints adds private performance bonds, conflict resolution, generality, natural hierarchy. It appears people bring info to Consensus Point to be securitized, while castpoints securitizes info at, and by, the source. Their website has interesting examples.

Litmus test 1: Do criminals find it useful? Yes: From crowdsourcing to crime-sourcing: The rise of distributed criminality.
Litmus test 2: Is it fun? The Consensus Point GE example noted how participants had fun. This is a critical point. When people are having fun, they are doing what the love to do and are invested in doing it well.

3) MONEY FLOW

  • Money enters via:
    • Posting a new thread.
    • Rating any post.
    • Voluntarily, publicly, and verifiably – paying for use of content. (a small part)
  • Money exits via payments to:
    • Dividends to value adders.
    • Transaction fee to forum owner.

4) DETAILS
Publishers pay to post new threads. They use realtime estimated ROI’s to publish where they will likely be profitable. Publishers can also conditionally publish so that the post is only published if specific criteria are met. Such as a a minimum estimated ROI of 25%. (Although castpoints is money agnostic, silver milligrams are used as the default base denomination due to it’s universality. Later, the account holder might specify preferred payment types, which could even be local scripts.)

Consider the “Current Costs To Post New Thread In…” sample screen shot.”

cast roi dec 12 2012

  • Mean value rating %: The rating for all posts in a category. The lower the rating, the more a valued post can earn. If the number is high, a post has to be pretty valuable just to break even.
  • Agmg conviction sum of past 28 days on site and off site: This info denotes the amount of focus people are giving threads and to some extent how likely a post is to go viral.
  • Mean spawn income preference %: The percent a poster receives directly if their post is promoted. If a person thinks a post is good, they can take the risk and or reward of republishing it on a big site where the post costs are high. The lower the Max Spawn Income percent, the more likely the post will be republished.
  • Cost to post new thread: the current cost of posting a new thread immediately, including a bit of past price history. Formula described below.
  • Cued conditional posts: All possible posts are transparently listed.
  • Estimated ROI based on your rating: using the cost to post, a posters current rating in a category, the estimated ROI is show with a confidence interval of 90%.

… and then fill out the publishing form to start a new thread:

Post types:

  • General: just info.
  • FYI, response optional: Allows others to be directly notified. Could be used for discussing a homeowners association, proposal, focus groups, etc. Participation is optional.
  • Response required: Only officially used when backed by a contract.
  • Challenge: Used to formally question a post’s assertions, or an entity. Participation is required, or else challenger wins.

New post cost is automatically determined by real time supply and demand ( Site wide ( STD( last 15 publishings) * AVG( last 3 posts ) ) * 0.5 ) + ( 
Thread ( STD( last 15 publishings ) * AVG( last 3 posts ) ) * 0.5 ). Projected cost trends can be visually examined. (Possibly add “Minimum maturity level: Anyone, teenagers, grown ups, other.” since it can finally be enforced.)

Others can optionally rate what posts are worth to them.

  • Republish credit is the info that follows a post that allows castpoints to know who to pay based on their indicated spawn income percentage.
  • “% Valuable” is what percent of the post the rater deems valuable and or adding value to the thread.
  • “Conviction” Optional. Indicates how strongly the rater feels about their rating. The numerical values range from 1 to the max of (highest the user has used in the past month, or the highest on the post so far). The scale rises exponentially for about 15 specific numerical choices. ~$x = exp( ( log( $row[max_reply_conviction] ) / 6 ) * $i ).

A rated post’s subject and author lines displays simple initial statistics:

Misinterpreting Value Is Easy 84% V, 75% C, 2 days ago.
By Jeff 84% V, 75% C 

  • “84% V” is the median percent value rating: people decided that 84% of the post is valuable.
  • “75% C” is the rank of total conviction compared to all other posts in that category. Rank is also used to keep the income of poster semi private. (Rank is rounded to steps of 5.)

5) POST PROMOTION – GOING VIRAL
Max spawn income: If republished in full, this is the percent of all income the original publisher gets from any republishings. If a person thinks a post is good, they can take the risk and or reward of republishing it on a big site where the post costs are high. The lower the Max Spawn Income percent, the more likely the post will be republished.

Instead of hat tips and not being able to easily pay people for value, people can credit a poster directly. This is partly an effort to supersede non tangible patents. If a publishing is not reposted in full, the compensation formula = % of the reused post * % the reused post makes up the new post. So if 25% of an old post makes up 2% of a new post, the first poster gets 0.25 * 0.02 = 0.002 of profit from the new post. Not revenue. This is how something self-defines as “commercial” or “non-commercial”. Example:

… A problem with science, then, isn’t that most experiments fail — it’s that most “failures are ignored.” (Credited 0.2% to Seraphina Fox) It’s challenging to ignore valuable information when money is involved…

Clicking the “Credited…” link will verify the basic stats of the transaction.

6) WEEKLY PAYMENTS FROM RATING MONEY
The payment cycle is every 7 days after a post and continues indefinitely as long as republishing and or replies continue. The formula is the product of a poster’s value ranking and total conviction, with distribution skew balanced at 50% of a thread’s mean value rating. If a thread mean rating drops to say 45%, the distribution skew rises to pay out 5% more to posts rated above 50% which attracts more valuable posts. This means that it is easy to identify where a little value can make relatively large returns.

Any money from inactive accounts (over 1 year with no activity) becomes dividends.

7) PRIVATE PERFORMANCE BONDS AND CONFLICT RESOLUTION
A performance bond’s amount is a poster’s trailing 3 month maximum post cost times 3. Each castpoint escrows this by withholding 25% of each dividend.

Posts that don’t follow a sites contracted rules of conduct can be “challenged” by anyone with a rank over 50% and a funded performance bond account.
The basic contract for each party including service provider: (Partly from Richard Maybury.) Do all you say you are going to do. Don’t infringe on other people or their property. Make amends by cleaning up inevitable mistakes. Make the difference between fact, and non-fact, clear. This is strict…

  • NOT challengeable: “I think people will love the taste of this new recipe.”
  • Challengeable: “People love the taste of this new recipe.” Better be able to show independently verifiable proof within 6 weeks, otherwise don’t post.

Conflict resolution:

  • This has zero to do with inefficient “precedent” nor “punishment” nor “laws”. Either a contract is honored, or not.
  • A “challenged contract” case is settled at 6 weeks.
  • If the challenged does not respond, they default.
  • Resolvers are self selected and post either “Responsible” or “Not responsible” with reasoning.
  • A resolver’s post can also be rated, commented on, and “challenged”.
  • It only takes one resolver’s decision. If more than one resolver posts, 75% need to agree, or the challenger is held responsible. If no resolver posts, the challenger is held responsible.
  • If the challenged is found NOT responsible, 50% of the challenger’s performance bond is paid to the challenged. If the challenged is held responsible, 50% of their performance bond is paid out.
 If the challenger is not the entity who owns the property, the property owner and challenger split the payout 50:50. (People can challenge someone on behalf of someone else.)
  • Resolvers basic rules: Only consider independently verifiable facts. Another resolver has to add value, not just a “me too.” Otherwise they can be challenged.

8) VIGNETTES
Reporter checks topics in an area of expertise and finds that demand is high right now but quality seems low. Reporter finalizes some fact checking and posts article at a cost of 100 Agmg.
A) Success! Other’s give article high value ratings with conviction. When dividends are paid at the end of 7 days, the reporter is paid 125 Agmg.
B) No so successful. Other’s give article low value ratings with low or high conviction. When dividends are paid, the reporter is paid 50 Agmg. The reporter can study replies for constructive criticism, and rate a few good ones.

Proofreader replied to newsletter poster about a few typos with a value rating and zero conviction. The newsletter poster replies to the proofreader with a high rating and some conviction. This particular forum uses settings that if a poster has a rating of over 75% but zero conviction, the site pretends the poster has a conviction of 10 Agmg’s. It’s basically a marketing cost.

Middle person sees a post on a small website they think has a lot of value. They promote it to a large website at a cost of 1,000 Agmg.
Path A) Success! The middle person gets paid 1,200 Agmg in 7 days, and the original poster gets (say) 100 Agmg due to their Max Spawn Income of 10%.
Path B) Not so successful. Middle person gets paid 700 Agmg, and original poster get 30 Agmg due to their Max Spawn Income of 10%.

9) SPECIFIC CASES OF INFATUATION:

  • Advertisers – For the first time in written history, ads are welcome because people either get good info, or get the advertisers’ money.
  • Copyright holders — This is an evolution of copyright: paid for adding value rather than fighting to protect value. Transparency promotes paying others for content, even what is “fair use”, so they don’t look cheap.
  • Forum owners – Finally have a built in conflict resolution process to manage trolls and flame wars.
  • Regulators – Takes a huge load off what government is “supposed to do”, and essentially spreads it to local people who are probably experts in the field, and who are compensated.
  • People with no money – If they add value, they will get money. They can start with literally zero money and, say, organize a FAQ page, correct typos, etc.
  • Small publishers – Can have much more fine grained and direct info regarding supply and demand of their topics of interest. If a post goes viral, they can make a lot of money and reputation very quickly with no additional effort. Just answering questions about their viral post exposes them to more compensation.
  • Lurkers – Can explore in an environment with a minimum of trolls and relatively more confidence about the quality of information.
  • Email readers – allows senders and readers to prioritize messages. Makes spamming expensive, and people are generally happy to have their email address public.

Those who might need to find a different job:

  • Anyone addicted to opaque control of others via force, complexity, and manipulation.
  • Big gov– people will govern themselves at a local level.
  • Many courts – Too unfair, untimely, and expensive.
  • Many lawyers – Many of their jobs can be done for a micro-fraction of the cost and time.
  • Non truth tellers, trolls – Constantly costs them.
  • Politicians – those “represented” will instantly want politicians using castpoints. Finally, an easy way to make money off politicians instead of the other way around.

10) MONEY LAUNDERING
Almost impossible to do on a large scale because all money goes into the dividend fund and is distributed by merit. If participants try to create an overly large dividend on a small forum, that will quickly attract arbiters which defeats the purpose.

11) ACHILLES HEELS
Performance bond money just sits there, teasing those lacking integrity. I have not been able to find a simple and valuable secondary use for private performance bonds (other than each castpoint offering stock that offers dividends and ownership in exchange for insurance liability). So it would be best to create multiple castpoints to ensure competition.

Regulatory burdens are the main challenge. If castpoints lives up to it’s potential, any and all currencies could compete on the platform. This will likely be perceived as a primal threat by gov’s and central banks. This should change the flow of capital from pools of debt (slavery) and credit (master), to pooling as capital (freedom). Likewise, unloading conflict resolution from ponderous gov fiat to fast local expert non-fait resolution is a new paradigm. e-gold.com failed because they apparently managed regulatory burdens poorly. GoldMoney.com did well in this area, yet mostly stopped peer to peer payments due to “low use of this service and increasing regulatory burdens.”

12) PRIVACY AND REPUTATION
People own and own and control their info. They can associate specific info with a URL link (NetRep) to reveal a different data view to, say, accountants, the public, a specific interest group, other castpoint accounts, etc. The link in an email would be something like:

text, text, text, text.
Thanks, Jeff
http://www.castpoints.com/?netrep=43214

13) BUSINESS MODELS
Ultimately, castpoints makes money from a small fee on each transaction. Non exclusive copies can be leased. Open source the majority and charge for the newest features. (Similar to Open Office.)

Coding the front end is simple. Coding the backend is a significant challenge with an emphasis needed on security and non tampering ability. The real challenge is dealing with fiat and gov regulations. The project can be very small since customer service and overhead should be minimal.

A Provisional Patent was filed on June 4th 2012. “Castpoints”: A method that securitizes information directly, via self regulating: winnowing and promotion of value, conflict resolution, reputation, and private performance bonds.

14) SPECULATIVE VERSIONS & EVOLUTIONS

  1. The initial castpoints will be denominated in silver milligrams, but really backed by major currencies.
  2. Addition of sophisticated statistical analysis and pre posting decision trees and keywords via open architecture.
  3. When enough momentum to support money changers is present, open platform to most currencies and scrips. (monetary freedom)
  4. By now an email plugin should be available. When people can conveniently rank their email by how much conviction senders put behind it, spam dies.
  5. To be more useful, capital will likely move closer to transaction points (away from central banks and debt). Yet due to the Singularity’s exponential advance, money just sitting around becomes glaringly inefficient. So each castpoint entity (could be a company or person) could offer dividend paying stock in return for liability. This would dramatically increase the velocity of capital. (trading decentralizes)
  6. Centralized control simply can’t keep up. The differentiation between a companies, customer service, intranet, product, and or service becomes blurred since they are all stewarded by a local castpoint framework. The definition of an employee will also blur: who’s managing the FAQ’s, suggesting valuable ideas, finding bugs? Could be anyone. Add the pressure of “politicians” being asked to use castpoints and constantly losing money. People could realize centralized politics (control) has a lot of friction (expensive, slow, corrupt). (ability to add value transcends hierarchies, labels, identities, and roles. (Not outsourcing: all sourcing))
  7. Possibly most importantly, what people put out returns very directly in a measurable and honest way, which provides helpful feedback about one’s behavior. Meaning: we learn to critique in supportive ways while increasing everyones’ psychological sanity. (auto-self-actualization)
  8. Sovereign Individuals become their own central stores of value. They are distributed, localized, and expert profit centers backed by performance bonds.

Please consider helping this project be real.

Update September 2012: The Collaborative Lab gets it!!! Check out their chart on The Big Shift, and Welcome To The New Reputation Economy by Rachel Botsman

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