http://www.forbes.com/2006/02/11/sterling-money-future_cz_bs_money06_0214sterling.html?boxes=custom
Money
The Futures Of Money
Bruce Sterling, 02.14.06, 12:00 PM ET
NEW YORK - Money is a widely distributed machine whose purpose is to
compute the value of goods and services. In order to function, money
needs certain vital qualities.
Money has to be mobile, so as to move from hand to hand with ease.
Money needs to be flexible: incarnating itself as coins, paper, bonds,
stocks or zipping electronic impulses. Money needs psychological
acceptance: The population must unblinkingly accept the fact that a
plastic card or flimsy paper is of great value.
Money needs consistency and staying power: Money can't be allowed to
hyperinflate to nothing in a week, or to be usable only on leap years,
or to change its colors with the fashion seasons. Money needs to be
perfectly fungible: One dollar is always exchangeable for any other, no
matter what its source. And, lastly, money needs authority to issue it,
to manage it, to back its value and to chase off rival systems of
money.
Societies have been known to disarm and give up warfare, but nobody
de-banks and gives up money. It would be easier to give up religion,
maybe even language. Money evolves. It writhes around energetically,
trying to fulfill its contradictory roles and to become all things to
all interested parties. That is not possible, so money therefore
periodically breaks down and blows up. Previous terms for these
episodes were bank failures, financial panics, runs on currency, debt
crises, liquidity runs, national defaults, bubbles, hyperinflation. As
new calamities arise, we will give them new names.
Money is a form of computation: As money is transferred from one eager
owner to another, it computes the value of goods and services. At its
best, the machine automatically arbitrages the value of goods and
services between different monetary systems. Money fluctuates in value
against other currencies, sometimes wildly. We cannot invent a stable
money any more than we have ever invented a fully stable computer
operating system. Why? Because we don't want fully stable computers.
Only boring people with no sense of invention or enterprise would use
them. Money that worked perfectly would lack all entrepreneurial
opportunity. We don't use money merely to generate wealth. We use money
to create new methods of generating wealth.
The movement of money has reached top speed now. We can't exceed the
speed of light. But, in the future, money will be handled much more
quickly, and it will travel over very long and very crooked paths.
Instead of a plastic card for a bank, we could have a plastic card with
a bank. The stone-pillared edifices that used to house banks are full
of nightclubs and gyms now; people bank electronically, they use ATMs.
An ATM is merely a device to spit paper. Why not make every card an
ATM? Tomorrow's microchips won't lack for capacity. A cell phone is
like yesterday's switching station, a laptop is yesterday's
supercomputer. Why settle for a bank account when you could buy a cheap
bank-on-a-chip?
Instead of price tags, we could have radio frequency identification
tags that calculate price as you touch the item. Once they're stamped
with an inked price, objects have to settle for that value, but why
dont prices change instantaneously in response to demand?
Instead of credit ratings to acquire capital, credit records could
become capital. If I'm superb at shopping, a super-user whose word is
law for those who trust me for recommendations, how come I'm not paid
to shop? Maybe Mr. A minds his p's and q's and never touches his
capital--while Mr. B is a player who plunges into debt and escapes it
repeatedly.
Instead of "socially responsible investment," we might be confronted
with money that refuses to let itself be spent. Electronic funds might
double check themselves against a blacklist before they move from one
chip to another. Touch a terrorist bank account, and you might find
yourself with not just a refusal of funds but also with instant taps on
your phone and e-mail.
Instead of secret bank accounts, entire secret banks: offshore data
havens tucked into satellites or old dead oil rigs or blast-proofed
caves outside Kandahar. Black electronic money is encrypted data that
does not let itself be recognized as money. Like jewels sewn into a
coat lining, a self-perpetuating spool of ones and zeros refuses to
admit that it is wealth.
Imagine that you no longer read speculative articles in financial
magazines. You don't pay to read ink in magazines. Nobody does that
kind of data transaction anymore. Instead, imagine yourself confronted
by an electronic Web page that is eager to read you. Once it learns who
you are and how much you have to offer, it make a ferocious effort to
convince you that the money game is transforming, with profoundly new
players, unimaginable new rules. Then it offers you money to believe
what it says. It demands that you act as its broker and send it to all
of your friends.
Bruce Sterling is a futurist, journalist and science-fiction writer. He
is living in Belgrade, capital of Serbia and Montenegro, and witnessing
markets in transition.
