I give banks (ie credit intermediaries) between 2 and 5 years before they are "Napsterised" and after this happens, progress to a fairer society will be rapid.
Except that the parties to the credit transaction (which may be settled in money or even "money's worth") will be members of the "third party".
ie a form of mutualised credit I call a "Guarantee Society".
Investments are something else, and distinct IMHO from credit (= time to pay").
Here I see investors in productive assets (eg property renewable energy) connected "peer to peer" with people who need investment. The difference being that the investment vehicle would no longer be the existing sub-optimal "Corporation".
This will be superseded by partnership based forms such as US LLC's and UK LLP's. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
Except that the parties to the credit transaction (which may be settled in money or even "money's worth") will be members of the "third party". ie a form of mutualised credit I call a "Guarantee Society".
Credit Unions create no credit "ex nihilo", as a bank does, based upon the amount of capital set by the Basel-based BIS.
www.zopa.com and www.prosper.com essentially disintermediate/ Napsterise credit unions, but lack a guarantee function.
The idea of a "Guarantee Society" is that bilateral "trade" credit - ie from seller to buyer - is subject to a mutual guarantee by members of the GS collectively in respect of which the users of the guarantee pay an amount into a "default pool".
Settlement of the credit granted may be either in conventional money, or, if the seller agrees, in "money's worth" (ie barter).
The result is of banking without the bank as intermediary, although there is a requirement for a service provider to manage the system, allocate "guarantee limits" manage defaults etc.
ie the bank becomes a service provider.
But note that this model facilitates the creation and circulation of wealth through "mutualising" credit creation.
Equitable investment of existing wealth is another matter entirely. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
But local groupds will be able to link together to form "pools of pools" and so on...
Conventional "microcredit" Grameen Bank style relies upon small groups of guarantors.
And when you think about it, all that credit derivatives are is a form of time limited guarantee, but not exactly a transparent one... "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
We are talking "bottom up" community based groups here, probably both geographical and functional. ie any group of individuals with a "common bond". But local groupds will be able to link together to form "pools of pools" and so on...
Sounds like the credit union movement to me.... Index of Frank's Diaries
Existing credit unions would manage the process and the default "pool", and handle accounting and defaults etc as "service providers". "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
