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BerkShares

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Re: BerkShares

#41

Post by brianpgordon »

rurounijones wrote: post #9
bigdubs wrote: post #6

Earlier quoted context omitted.

It's pegged to the dollar.

For the moment, the wikipedia article talks about plans to not have this be the case. > but Nick Kacher of the Schumacher Center has discussed the possibility of pegging its value to a basket of local goods in order to insulate the local economy against volatility in the US economy.[6] What then?

With a peg to the USD, banks will be happy to take your real money and hold onto it while the exchanged Berkshare remains in distribution, because they know that at worst they only have to pay back the original money. But as soon as the Berkshare is able to move against the dollar, participating banks assume some risk because they may be forced to pay out more than 1 USD for a single Berkshare. There's even some risk that the bank could run out of "foreign currency reserves" (USD deposits) to defend the Berkshare, causing it to collapse.

Re: BerkShares

#44

Post by icebraining »

valuearb wrote: post #38
deanCommie wrote: post #36

Earlier quoted context omitted.

This only applies in a market where consumers always make objectively ideal decision. This applies to smart phones, electric cars, and CPUs. ( mostly , see post-script) But for most goods, there is no such thing. What is the "best" tomato or a jar of honey for a consumer to buy? Is it the cheapest? The brightest? The most delicious? Yes, all those things. But the evaluation of them is subjective for most. A tomato fr…

Consumers always make objectively ideal decisions. What you think the best good for them to buy is not necessarily what they think, and they are the ones who are right.

I've bought things despite knowing it wasn't the best for me. I think that one shouldn't presume to know better than the consumer, though.

Re: BerkShares

#46

Post by okreallywtf »

This is interesting, thought I am having a hard time determining what make this different enough from Liberty Dollars [1] which made a splash in NC years ago. Liberty Dollars were supposed to be worth the metals they were constructed of, so they were not pegged to any currency but their intended use was much the same (finding local businesses that would accept them). It seems odd that the purveyors of liberty dollars were arrested and other private currencies are allowed? The main complaint I saw was that they were too similar to "real" US currency, but the response seems exaggerated if thats all it really was.

[1] https://en.wikipedia.org/wiki/Liberty_dollar_(private_curren...

Re: BerkShares

#47

Post by deanCommie »

valuearb wrote: post #38
deanCommie wrote: post #36

Earlier quoted context omitted.

This only applies in a market where consumers always make objectively ideal decision. This applies to smart phones, electric cars, and CPUs. ( mostly , see post-script) But for most goods, there is no such thing. What is the "best" tomato or a jar of honey for a consumer to buy? Is it the cheapest? The brightest? The most delicious? Yes, all those things. But the evaluation of them is subjective for most. A tomato fr…

Consumers always make objectively ideal decisions. What you think the best good for them to buy is not necessarily what they think, and they are the ones who are right.

That's the argument I'm making. Consumers know best.

Re: BerkShares

#49

Post by tudorw »

As an aside, the Transition organisation here in the UK back a few currencies, the https://en.wikipedia.org/wiki/Totnes_pound is well supported, this is not new, here's a good piece on 'time based currency' https://en.wikipedia.org/wiki/Time-based_currency and https://en.wikipedia.org/wiki/Local_exchange_trading_system which has some traction in the UK, though their website could do with a little help, http://www.letslinkuk.net/index.htm

Re: BerkShares

#50

Post by tanderson92 »

TACIXAT wrote: post #11

>Nick Kacher of the Schumacher Center has discussed the possibility of pegging its value to a basket of local goods in order to insulate the local economy against volatility in the US economy. Is there a name for pegging a currency to a basket of goods? I can't find any examples online.

Units of account: http://www.econ.yale.edu/~shiller/online/uf-usa4.html

Shiller is a fan of interesting financial engineering of this type which he discusses in his books "Finance for the Good Society" and "Macro Markets".

For example, he also proposes a US bond which pays out interest fixed relative to GDP.

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