Have YOU Ever Heard Of A Human Aggregate That Ran Out Of Fiat?

It's sad & amazing that the function of national group-brains is declining (and our aggregate species group-brain too) ... even as neuroscientists worldwide obsessively over-study the structure of individual primate brains, all the while oblivious to the structure of the group-brain emerging all around them. 

That brings new comedy to the term OCD. 

On what scale? You can easily argue that the phenotypic persistence displayed in Deep State institutions mediate SSOCD, or social-species obsessive-compulsive disorders.

Consider the following trains of thought.

Balance sheet recessions and democracy 

and 

A depressing report from Florence

From the Renaissance to depression, in 500 years. Two impressions forward, one depression back? Is that the best we can do?

Somewhere in our current culture, we've forgotten that the whole purpose of social species is to take on Desired Consensus Outcomes which are beyond the ambition of individual skill sets.

Too few follow such discussions.

Hence, those that do are largely ignored, as aberrations.

Too much of our public discourse has been on various collision courses, & have actually already collided, years ago, producing our ongoing, slow-motion train wreck.

The US is supposedly acting slightly more intelligently than Japan or the Euro-zone ... yet not much, as the confusion in the following article shows.

"Weak banks don’t lend, highly indebted consumers don’t spend, and businesses with poor prospects don’t invest."

Yet this same WSJ author comes out with the oxymoronic statement:

"But U.S. policy makers failed to forge agreements to rein in long-run deficits, ..."

Why? Because ...

[a deficit in fiat] "could be a problem should another crisis hit."

WTF? And edges COULD be a problem too, IF the earth were flat.

I swear. Too many people in diverse disciplines forget the simple method of algebraic substitution, as a sanity check. 

To spell it out for non-thinkers, we all say we've used fiat currency for 80+ years. Yet what does "fiat" mean? At will? Who's will? The public's? So fiat currency denominates net Public Initiative? The word "fiat" means initiative, and/or nerve? Similar to public confidence?

Have YOU ever heard of a human aggregate that ran out of fiat?

And if there's a deficit, what is it that we're trying to balance? The balance of Public Initiative vs personal hoarding? Inflation vs deflation? Stockpiling Future Options vs Trying to Hoard Current Fiat? People get lost in making lists of things to balance, often losing track of form vs function. At the end of the day, we do have a constant, orienting reference: balance what continues to be adaptive vs what becomes maladaptive.

Yet some other slow boarder, trying to catch the thinking train, opines that"monetary policy is limited when an economy slows down considerably and lacks confidence."

LOL! Let me try to translate & extend that to it's logical implications. Groups run out of confidence, & generate a deficit in nerve, which they must then borrow? Can't spend nerve they don't have? Sub-groups often run out of confidence. When they do, they borrow - or rather receive - more nerve from the larger aggregate. That's what defines a social species.

All this lack of sense makes you wonder how humans made it through the last 200K years, always running a perpetual "deficit" in nerve. Does no one get the joke?

Who have we been "borrowing" nerve from all these millennia? Accountants presuming an external source for every sink? Was double-entry bookkeeping a miracle or a curse? Or always both simultaneously?

That all this social noise occurs in the year 2014 is a sad testament to the fragility of homo sapien logic. Homo sapiens still can't see the culture (or social species) for the individual?

And, there's the parallel myth that "job creators" create jobs by hiring people - even though that is just one receiving step in a cycle. One businessperson hires only when they have requests from other buyers to sell more, so they hire to meet that demand. Businesspeople rarely hire just to stockpile inventory, i.e., with no sales in sight. Optimal asset stockpiling occurs as aggregate stockpiling Policy Options, as a growing Policy Space, which they explore by increasing the distributed options available to their grandchildren.

Somewhere upstream in the circle of consuming/buying ... if buyers/consumers [i.e., job creators] have no income, limited options, and constrained innovation, how are they supposed to create jobs (i.e., demand for products and services)?

Acquisition pulls economies. Only drug dealers push.

Ok, greedy lobbyists do too.

Can we just redefine NeoLiberal's as those who don't believe in social species? Rather like those that don't believe in a round Earth or a helio-centric solar system?

Until then, we may as well stamp the following on the business card of Homo Sapiens:

Have Options,

WON'T Explore Them.

What are Monetary Operations For?

How do we use distributed monetary operations to advance Public Purpose, sooner rather than later?

Briefly, organizations do what they must to survive. That includes inventing social species. The human social species survives by organizing scalable success faster than other species. Our moment of adaptation now floats among human cultures, as an unfolding success path tracking the combined pace & quality of distributed decision-making .

To optimize national returns, we generate as many distributed options as possible, then select from them as wisely & pace allows.  Success is continually minimizing constraints on decision quality. For currency, we do that in large part by separating two concepts - quantity and price of bookkeeping currency.  Across diverse decisions co-optimizing both local and group outcomes, it is price, and not access to bookkeeping, that should be the only burden on local degrees of freedom. Focusing on bookkeeping price vs quantity guarantees all people infinite pathways for contributing to group benefit. Limiting access to fiat currency simply limits the volume of numerals that students may utilize as they progress through math studies.   Once virtual bookkeeping is free, there is no public utility in limiting it's utilization.

In order to scale agility of large groups, currency supply should grow, on-demand, while available options should compete per ROI. That refinement is precisely what allows us to parse scaling options.  Evolving groups need the confidence to explore increasing options, yet still want to choose wisely.  Constraining the quantity of distributed bookkeeping is a useless distraction, whereas floating local pricing - NOT price stability - retains and focuses utility.  Stringing together organized chains of distributed decisions is EXACTLY how agile groups outpace more constrained groups.

Populations removed currency quantity as a constraining variable by transitioning to "fiat" currency standards, where currency supply follows than rather constrains the number of distributed transaction decisions that can be made.  Fiat currency, in it's most general definition, is not convertible upon demand to any particular commodity, only indirectly to public initiative.  Further, it's volume is allowed to float, as a function of public initiative.  Finally, it's exchanage rate with other currencies is also allowed to float (floating Fx). Together, these measures help remove currency supply as a constraint when optimizing the quality of distributed decision-making. Fiat currency is simply a virtual measure of unbounded public initiative. The currency-access side of distributed decision-making is never the place to impose market discipline, since it has become obsolete as a limiting variable.

Fiat currency, as only one of many tools we use, is created and distributed via public initiative (Appropriated by Congress, agent for the electorate), destroyed through taxation or return of fiat "profits" to our Treasury, the currency issuer (through it's agents, the IRS & Central Bank) yet primarily utilization in distributed transactions.  Other tools that we use are regulatory services that serve primarily to manage tolerance limits for all aspects of self-organization, from preparatory education standards to control of fraud rates.

Monetary operations involve fiscal, monetary, taxation and criminology fields - all serving public policy.   As only one of multiple tools, monetary operations are useful only when coordinated to optimize quality of distributed decision-making.

Developmental statistics, freak accidents & psycho-social variance will always prevent us from 100% utilization of our population at any time.  However, access to minimal local currency supplies as "revenue" is an obsolete concept once the transition to a virtul or fiat currency standard occurs.  There is no downside for the issuing group since currency supply follows net group initiative, and is not convertible upon demand to anything else. The upside includes more options to pursue full utilization of human capital as asynchronous group options occur.

The only reason for a group denying a member access to minimal "maintenance" amounts of fiat currency is lazy admission that "we can't come up with anything worthwhile for you to do."  None know the potential value of others, given 308 million people.  Rather, to explore unpredictable options, we either suggest things to be done, or follow individual's suggestions for novel things worth doing.   Since fiat currency supply is infinite, we need only practice selecting ROI from - not constraining - emerging, distributed initiative.

There are no better places to orient to modern monetary operations than the books by Mosler, "The 7 Deadly Innocent Frauds of Economic Policy" and Mitchell, "Full Employment Abandoned".