Group items tagged

Open Capital is defined as “a proportional share in an enterprise for an indeterminate time”

‘Enterprise’ is defined as ‘any entity within which two or more individuals create, accumulate or exchange Value”.

Value is to Economics as Energy and Matter are to Physics.

The Metaphysics Of Value

division between “subject” and “object”.

primary reality is “Quality”

formless and indefinable

not a “thing”

a non-intellectual awareness or “pre-intellectual reality”

but an event at which the subject becomes aware of the object and before he distinguishes it

Quality is the basis of both subject and object

distinguish between “Static” and “Dynamic” Quality

treating Value as a form of “Quality” as envisioned by Pirsig.

Riegel

defined “Value” as “ the Relativity of Desire” again implying indeterminacy.

Pirsig’s approach Capital may be viewed as “Static” Value and Money as “Dynamic” Value. “Transactions” are the “events” at which individuals (Subjects) interact with each other or with Capital (both as Objects) to create forms of Value and at which “Value judgments” are made based upon a “Value Unit”.

The result of these Value Events /Transactions is to create subject/object pairings in the form of data ie Who “owns” or has rights of use in What,

at what Price

accounting data

Neo-Classical” Economics confuses indeterminate Value with a market– determined Price –

Data may be static

This Data identifies the subject with objects such as tangible ‘Material Value’

Data may itself constitute ‘Intellectual Value’

It, too, may then be defined in a subject/object pairing through the concept of “intellectual property”.

Other forms of Value are however not definable by data:

“sentimental” Value

Emotional Value’

'Spiritual Value’

We may therefore look at the “transaction” or “value event” in a new light.

The creation and circulation of Value essentially comprises the concept we know of as “Money”.

Money / Dynamic Value

“The purpose of money is to facilitate barter by splitting the transaction into two parts, the acceptor of money reserving the power to requisition value from any trader at any time

money

value unit dissociated from any object

monetary unit

the basis relative to which other values may be expressed

The monetary process is a dynamic one involving the creation and recording of obligations as between individuals and the later fulfilment of these obligations

The monetary “Value Event”/ Transaction involves the creation of “Credit”

obligation to provide something of equivalent Value at a future point in time.

These obligations may be recorded on transferable documents

database of “Credit”/obligations is not Money, but temporary “Capital”

“Working Capital”

Static Value – which only becomes “Money”/ Dynamic Value when exchanged in the transitory Monetary process.

what we think of as Money is in fact not tangible “cash” but rather

the flow of data between databases of obligations maintained by Credit Institutions

or dynamic

Banks literally “loan” Money into existence

In exchange for an obligation by an Individual to provide to the Bank something of Value

Bank’s obligation is merely to provide another obligation at some future time

These Bank-issued obligations are therefore

claim upon a claim upon Value

The true source of Credit is the Individual, not the intermediary Bank

this Money they create from nothing despite the fact that it is literally Value-less

Thus there is no true sharing of Risk and Reward involved in Lending

issue in relation to Credit/Debt and this relates to the nature of Lending itself.

the practice of Lending involves an incomplete exchange in terms of risk and reward: a Lender, as opposed to an Investor, has no interest in the outcome of the Loan, and requires the repayment of Principal no matter the ability of the Borrower to repay.

Ethical problem

Money is not

an “Object” circulating but rather a dynamic process of Value creation and exchange by reference to a “Value Unit”.

Capital/ Static Value

Capital represents the static accumulation of Value

Some forms of Capital are “productive”

An ethical question

in relation to Productive Capital relates to the extent of “property rights” which may be held over it thereby allowing individuals to assert “absolute” permanent and exclusive ownership - in particular in relation to Land

our current financial system is based not upon Value but rather a claim upon Value

Financial Capital consists of two types:

“Debt”

“Equity”

Interest

obligations of finite/temporary duration but with no participation in the assets or revenues

absolute and permanent ownership/participation (without obligation) in assets and revenues

discontinuity between Debt and Equity

at the heart of our current problems as a Society

The Enterprise

‘Charitable’ Enterprise

‘Social’ Enterprise

Value

exchanged in agreed proportions;

Value is exchanged for the Spiritual and Emotional Value

‘Commercial’ Enterprise

‘closed’

Value are exchanged between a limited number of individuals

Early enterprises were partnerships and unincorporated associations

need for institutions which outlived the lives of the Members led to the development of the Corporate body with a legal existence independent of its Members

The key development in the history of Capitalism was the creation of the ‘Joint Stock’ Corporate with liability limited by shares of a ‘Nominal’ or ‘Par’ value

over the next 150 years the Limited Liability Corporate evolved into the Public Limited Liability Corporate

Such “Closed” Shares of “fixed” value constitute an absolute and permanent claim over the assets and revenues of the Enterprise to the exclusion of all other “stakeholders” such as Suppliers, Customers, Staff, and Debt Financiers.

The latter are essentially ‘costs’ external to the

owners of the Enterprise

maximise ‘Shareholder Value’

There is a discontinuity/ fault-line within the ‘Closed’ Corporate

It has the characteristics of what biologists call a ‘semi-permeable membrane’ in the way that it allows Economic Value to be extracted from other stakeholders but not to pass the other way.

Capital most certainly is and always has been - through the discontinuity (see diagram) between:‘Fixed’ Capital in the form of shares ie Equity; and ‘Working’ Capital in the form of debt finance, credit from suppliers, pre-payments by customers and obligations to staff and management.

irreconcilable conflict between Equity and Debt

xchange of Economic Value in a Closed Corporate is made difficult and true sharing of Risk and Reward is simply not possible

No Enterprise Model has been capable of resolving this dilemma. Until now.

Corporate Partnerships with unlimited liability

mandatory for partnerships with more than 20 partners to be incorporated

in the USA

it is the normal structure for professional partnerships

Limited Liability Partnerships

In the late 1990's

litigation

The UK LLP is supremely simple and remarkably flexible.

All that is needed is a simple ‘Member Agreement’ – a legal protocol which sets out the Aims, Objectives. Principles of Governance, Revenue Sharing, Dispute Resolution, Transparency and any other matters that Members agree should be included. Amazingly enough, this Agreement need not even be in writing, since in the absence of a written agreement Partnership Law is applied by way of default.

The ease of use and total flexibility enables the UK LLP to be utilised in a way never intended – as an ‘Open’ Corporate partnership.

‘Open’ Corporate Partnership

concepts which characterise the ‘Open’ Corporate Partnership

it is now possible for any stakeholder to become a Member of a UK LLP simply through signing a suitably drafted Member Agreement

‘Open’

supplier

employee

may instead become true Partners in the Enterprise with their interests aligned with other stakeholders.

no profit or loss in an Open Corporate Partnership, merely Value creation and exchange between members in conformance with the Member Agreement.

Proportional shares

in an Enterprise constitute an infinitely divisible, flexible and scaleable form of Capital capable of distributing or accumulating Value organically as the Enterprise itself grows in Value or chooses to distribute it.

Emergence of “Open” Capital

example of how ‘Temporary Equity’ may operate in practice

The Open Capital Partnership (“OCP”)

Within the OCP Capital and Revenue are continuous: to the extent that an Investee pays Rental in advance of the due date he becomes an Investor.

Open Capital – a new Asset Class

create a new asset class of proportional “shares”/partnership interests

in Capital holding OCP’s

Property Investment Partnerships (“PIP’s”)

Open Corporate Partnerships as a Co-operative Enterprise model

A Co-operative is not an enterprise structure: it is a set of Principles that may be applied to different types of enterprise structure.

Within a Partnership there is no “Profit” and no “Loss”.

Partnerships

mutual pursuit of the creation and exchange of Value

Partners do not compete with each othe

the crippling factors in practical terms have been, inter alia: the liability to which Member partners are exposed from the actions of their co-partners on their behalf; limited ability to raise capital.

they favour the interests of other stakeholders, are relatively restricted in accessing investment; are arguably deficient in incentivising innovation.

The ‘new’ LLP was expressly created to solve the former problem by limiting the liability of Member partners to those assets which they choose to place within its protective ‘semi-permeable membrane’

However, the ability to configure the LLP as an “Open” Corporate permits a new and superior form of Enterprise.

it is possible to re-organise any existing enterprise as either a partnership or as a partnership of partnerships.

the revenues

would be divided among Members in accordance with the LLP Agreement. This means that all Members share a common interest in collaborating/co-operating to maximise the Value generated by the LLP collectively as opposed to competing with other stakeholders to maximise their individual share at the other stakeholders’ expense.

facilitate the creation of LLP’s as “Co-operatives of Co-operatives”.

he ‘Commercial’ Enterprise LLP – where the object is for a closed group of individuals to maximise the value generated in their partnership. There are already over 7,000 of these.

the Profit generated in a competitive economy based upon shareholder value and unsustainable growth results from a transfer of risks outwards, and the transfer of reward inwards, leading to a one way transfer of Economic Value.

This,

will very often impoverish one or more constituency of stakeholders

A partnership, however, involves an exchange of value through the sharing of risk and reward.

Whether its assets are protected within a corporate entity with limited liability or not, it will always operate co-operatively – for mutual profit.

Open Capital, Economics and Politics

continuity between Capital as Static Value and Money as Dynamic Value which has never before been possible due to the dichotomy between the absolute/infinite and the absolute/finite durations of the competing claims over assets – “Equity” and “Debt”

Open Capital Partnership gives rise to a new form of Financial Capital of indeterminate duration. It enables the Capitalisation of assets and the monetisation of revenue streams in an entirely new way.

It is possible to envisage a Society within which individuals are members of a portfolio of Enterprises constituted as partnerships, whether limited in liability or otherwise.

Some will be charitable

Others will be ‘social’

‘Commercial’ enterprises of all kinds aimed at co-operatively working together to maximise value for the Members.

the process has already begun

Capitalism

superior

to all other models, such as Socialism.

It can only be replaced by another ‘emergent’ phenomenon, which is adopted ‘virally’ because any Enterprise which does not utilise it will be at a disadvantage to an Enterprise which does.

The ‘Open’ Corporate Partnership is: capable of linking any individuals anywhere in respect of collective ownership of assets anywhere; extremely cheap and simple to operate; and because one LLP may be a Member of another it is organically flexible and ‘scaleable’. The phenomenon of “Open Capital” – which is already visible in the form of significant commercial transactions - enables an extremely simple and continuous relationship between those who wish to participate indefinitely in an Enterprise and those who wish to participate for a defined period of time.

Moreover, the infinitely divisible proportionate “shares” which constitute ‘Open’ Capital allow stakeholder interests to grow flexibly and organically with the growth in Value of the Enterprise. In legal terms, the LLP agreement is essentially consensual and ‘pre-distributive’: it is demonstrably superior to prescriptive complex contractual relationships negotiated adversarially and subject to subsequent re-distributive legal action. Above all, the ‘Open’ Corporate Partnership is a Co-operative phenomenon which is capable, the author believes, of unleashing the “Co-operative Advantage” based upon the absence of a requirement to pay returns to “rentier” Capitalists.

find new ways of efficiency

arbitration between efficiency and care

a global thinking of the problem

Fighting the attention and desire resource shortage: stoping to use advertisement?

The question is rather here to think the moderation of the psychopower

empower transindividuation, i.e. to make sure that an economic activity creates more possibilities of individuation than it tend to destroy by attempting to capture attention and canalize motivation in a funnel. Empower transindividuation would imply to empowering actors of their own lifestyle, winning back the savoir-vivre prescribing production

Should marketing stop using psychopower?

marketing ethics guidelines

transactions are more likely to be morally defensible if both parties enter it freely and fully informed

the goal of marketing should be to increase the likelihood and frequency of free and informed transactions in the marketplace

putting freedom as a criteria of morality

the industrial use of pycho- and neuropower tend to fall under the category of barriers to freedom

neurotechniques – to capture the attention

psychotechniques – to attempt to create motivation

Most people think commercials are a small price to pay for these benefits

advertising

denying the schemes of addiction and the fact that we are becoming through the objects of attentions

right to avoid attention capture by advertising

progress made in cognitive sciences proving that

reward system being abnormally stimulated

Advertisements exploit

vulnerability and reinforce their overconsumption behaviors

“if food advertising on TV were banned, significant reductions in the prevalence of childhood obesity are possible.” (Veerman et al. 2009)

What is at stake falls to be much more complex than the sole Freedom of Speech invoked for the advertiser

liberty of non-reception

would mean to guaranty every citizen the right to choose where and when he wants to access the advertising information

Change in the industrial and commercial paradigm

Economy of contribution and peer production

An economy of contribution means that users of a service are contributing to the production of these services.

example

is open-source software that are contributively build by potentially hundreds of developers organized in communities

minimize the gap between the producer and consumer

blur the frontier between professionals and amateurs

The Copernican revolution of the Vendor Relationship Management paradigm

change in the commercial paradigm, described as an Intention Economy i.e. the opposite of the Attention Economy

consumers are charged to express and discuss their intention

with businesses rather than the usual paradigm in which businesses where fighting for a piece of canalized motivation

Implementing such a system would nevertheless imply that marketing departments dispose of a system in which they could value their supplies and where they could be easily found by customers. Doc Searls promotes his answer to this issue: the Vendor Relationship Management system.

the belief that free customers are more valuable than captive ones — to themselves, to vendors, and to the larger economy.

To be free

1. Customers must enter relationships with vendors as independent actors.

2. Customers must be the points of integration for their own data.

3. Customers must have control of data they generate and gather. This means they must be able to share data selectively and voluntarily.

4. Customers must be able to assert their own terms of engagement.

5. Customers must be free to express their demands and intentions outside of any one company’s control.

This is a profoundly game-changing approach

big data that is the rush for consumers’ information potentially leading to the same dead-end of attention destruction and affective saturation than the former offline paradigm

VRM system working as a marketplace

the goal of marketing should be to increase the likelihood and frequency of free and informed transactions in the marketplace

less imperfect and less biased information in a cultural context overvaluing transparency, and a bigger atomicity due to the hereafter introduced trend for re-localized peer production.

3.2.2.3 VRM and externalization of the socialization process

Promoting the end of advertisement

means to find a new way to make the information circulate, what was the primary goal of advertisement

Until there is no alternative to massive advertisement campaign for the information circulation, it is indeed hard to ask entrepreneurs and managers to get rid of those successors of propaganda: such a transition process necessarily imply adaptation costs from the producer and the consumer side, and possible competitive disadvantage against competitors still maximizing profit through advertisement means

But the internet transformation of the general organology offers new way to think information circuits and potentially constitute an opportunity to externalize the socialization process of products that is to empower citizen-consumers organized in communities

Empowering groups of citizen doesn’t annihilate the risks of mis-use or counterproductive interest-taker behaviors but a well-designed system of trust between peers could minimize this risk by creating a dependency to what social capital other peers give you, as it is happening in the sharing economy: the credibility of a contributive peer would be guaranteed through what the P2P Foundation calls Feedback systems and peer-police

a strong structuration of products characteristics, allowing customers to personalize their choices according to their desire and constraints: such a “VRM+” system

Marketing would then be the art of being as high as possible in this ranking, as it is happening in SEO for search engines, but in this context of criteria explosion, marketing would then be the disciple of listening to customers’ wishes and aspiration needing an attention, in order to kick in the production or to adapt the following series.

3.2.2.4 Toward a possible equi-power

Such a system would tremendously re-configure the balance of power and tend toward a form of equi-power i.e. a social organization in which abuses of a “big” would be the potential object of a ranking sanction by the peers

self-regulative function

a form of economic Darwinism would let to conscious organization the right to curve their path toward a durable configuration in accordance with the social ecosystem.

the idea of equi-power is a form of homogenization of the social matter, in which the distortions in the balance of power would be compensated by the gathering of small forces sharing a common interest

Such a sanction systems, if successfully implemented, would make value-destructing businesses progressively decline and hopefully bankrupt,

long-term valuable strategic choice

long term satisfyingly high ranking

It would be utopic to think that the “being cool” marketing

would disappear, but marketers would have to make those two objectives compose together.

This social capital contagion is nevertheless a tool that would need to be controlled in its form of violence by extensive testings and iterations with forms of protections for the smallest peers, that is to say to keep this form of social violence to institutionalized, classic forms of businesses, clearly beyond the line of what should be acceptable in the global village.

the goal is here to create an artificial form of majority that is a self-censuring responsible behavior of corporations

A broad statement of the key idea of smart contracts, then, is to say that contracts should be embedded in the world.

And where the vending machine, like electronic mail, implements an asynchronous protocol between the vending company and the customer, some smart contracts entail multiple synchronous steps between two or more parties

POS (Point of Sale)

EDI (Electronic Data Interchange

SWIFT

allocation of public network bandwidth via automated auctions

Smart contracts reference that property in a dynamic, proactively enforced form, and provide much better observation and verification where proactive measures must fall short.

The mechanisms of the world should be structured in such a way as to make the contracts (a) robust against naive vandalism, and (b) robust against sophisticated, incentive compatible (rational) breach.

A third category, (c) sophisticated vandalism (where the vandals can and are willing to sacrifice substantial resources), for example a military attack by third parties, is of a special and difficult kind that doesn't often arise in typical contracting, so that we can place it in a separate category and ignore it here.

The threat of physical force is an obvious way to embed a contract in the world -- have a judicial system decide what physical steps are to be taken out by an enforcement agency (including arrest, confiscation of property, etc.) in response to a breach of contract

It is what I call a reactive form of security.

The need to invoke reactive security can be minimized, but not eliminated, by making contractual arrangements verifiable

Observation of a contract in progress, in order to detect the first sign of breach and minimize losses, also is a reactive form of security

A proactive form of security is a physical mechanism that makes breach expensive

From common law, economic theory, and contractual conditions often found in practice, we can distill four basic objectives of contract design

observability

The disciplines of auditing and investigation roughly correspond with verification of contract performance

verifiability

The field of accounting is, roughly speaking, primarily concerned with making contracts an organization is involved in more observable

privity

This is a generalization of the common law principle of contract privity, which states that third parties, other than the designated arbitrators and intermediaries, should have no say in the enforcement of a contract

The field of security (especially, for smart contracts, computer and network security), roughly corresponds to the goal of privity.

enforceability

Reputation, built-in incentives, "self-enforcing" protocols, and verifiability can all play a strong part in meeting the fourth objective

Smart contracts often involve trusted third parties, exemplified by an intermediary, who is involved in the performance, and an arbitrator, who is invoked to resolve disputes arising out of performance (or lack thereof)

In smart contract design we want to get the most out of intermediaries and arbitrators, while minimizing exposure to them

Legal barriers are the most severe cost of doing business across many jurisdictions. Smart contracts can cut through this Gordian knot of jurisdictions

Where smart contracts can increase privity, they can decrease vulnerability to capricious jurisdictions

Secret sharing

The field of Electronic Data Interchange (EDI), in which elements of traditional business transactions (invoices, receipts, etc.) are exchanged electronically, sometimes including encryption and digital signature capabilities, can be viewed as a primitive forerunner to smart contracts

One important task of smart contracts, that has been largely overlooked by traditional EDI, is critical to "the meeting of the minds" that is at the heart of a contract: communicating the semantics of the protocols to the parties involved

There is ample opportunity in smart contracts for "smart fine print": actions taken by the software hidden from a party to the transaction.

Thus, via hidden action of the software, the customer is giving away information they might consider valuable or confidential, but the contract has been drafted, and transaction has been designed, in such a way as to hide those important parts of that transaction from the customer.

To properly communicate transaction semantics, we need good visual metaphors for the elements of the contract. These would hide the details of the protocol without surrendering control over the knowledge and execution of contract terms

Protocols based on mathematics, called cryptographic protocols, tre the basic building blocks that implement the improved tradeoffs between observability, verifiability, privity, and enforceability in smart contracts

secret key cryptography,

Public key cryptography

digital signatures

blind signature

Where smart contracts can increase observability or verifiability, they can decrease dependence on these obscure local legal codes and enforcement traditions

zero-knowledge interactive proof

digital mix

Keys are not necessarily tied to identities, and the task of doing such binding turns out to be more difficult than at first glance.

All public key operation are are done inside an unreadable hardware board on a machine with a very narrow serial-line connection (ie, it carries only a simple single-use protocol with well-verified security) to a dedicated firewall. Such a board is available, for example, from Kryptor, and I believe Viacrypt may also have a PGP-compatable board. This is economical for central sites, but may be less practical for normal users. Besides better security, it has the added advantage that hardware speeds up the public key computations.

If Mallet's capability is to physically sieze the machine, a weaker form of key protection will suffice. The trick is to hold the keys in volatile memory.

The data is still vulnerable to a "rubber hose attack" where the owner is coerced into revealing the hidden keys. Protection against rubber hose attacks might require some form of Shamir secret sharing which splits the keys between diverse phgsical sites.

How does Alice know she has Bob's key? Who, indeed, can be the parties to a smart contract? Can they be defined just by their keys? Do we need biometrics (such as autographs, typed-in passwords, retina scans, etc.)?

The public key cryptography software package "Pretty Good Privacy" (PGP) uses a model called "the web of trust". Alice chooses introducers whom she trusts to properly identify the map between other people and their public keys. PGP takes it from there, automatically validating any other keys that have been signed by Alice's designated introducers.

1) Does the key actually belong to whom it appears to belong? In other words, has it been certified with a trusted signature?

2) Does it belong to an introducers, someone you can trust to certify other keys?

3) Does the key belong to someone you can trust to introduce other introducers? PGP confuses this with criterion (2). It is not clear that any single person has enough judgement to properly undertake task (3), nor has a reasonable institution been proposed that will do so. This is one of the unsolved problems in smart contracts.

PGP also can be given trust ratings and programmed to compute a weighted score of validity-- for example, two marginally trusted signatures might be considered as credible as one fully trusted signature

Notaries Public Two different acts are often called "notarization". The first is simply where one swears to the truth of some affidavit before a notary or some other officer entitled to take oaths. This does not require the notary to know who the affiant is. The second act is when someone "acknowledges" before a notary that he has executed a document as ``his own act and deed.'' This second act requires the notary to know the person making the acknowledgment.

"Identity" is hardly the only thing we might want map to a key. After all, physical keys we use for our house, car, etc. are not necessarily tied to our identity -- we can loan them to trusted friends and relatives, make copies of them, etc. Indeed, in cyberspace we might create "virtual personae" to reflect such multi-person relationships, or in contrast to reflect different parts of our personality that we do not want others to link. Here is a possible classification scheme for virtual personae, pedagogically presented:

A nym is an identifier that links only a small amount of related information about a person, usually that information deemed by the nym holder to be relevant to a particular organization or community

A nym may gain reputation within its community.

With Chaumian credentials, a nym can take advantage of the positive credentials of the holder's other nyms, as provably linked by the is-a-person credential

A true name is an identifier that links many different kinds of information about an person, such as a full birth name or social security number

As in magick, knowing a true name can confer tremendous power to one's enemies

A persona is any perstient pattern of behavior, along with consistently grouped information such as key(s), name(s), network address(es), writing style, and services provided

A reputable name is a nym or true name that has a good reputation, usually because it carries many positive credentials, has a good credit rating, or is otherwise highly regarded

Reputable names can be difficult to transfer between parties, because reputation assumes persistence of behavior, but such transfer can sometimes occur (for example, the sale of brand names between companies).

Blind signatures can be used to construct digital bearer instruments, objects identified by a unique key, and issued, cleared, and redeemed by a clearing agent.

The clearing agent prevents multiple clearing of particular objects, but can be prevented from linking particular objects one or both of the clearing nyms who transferred that object

These instruments come in an "online" variety, cleared during every transfer, and thus both verifiable and observable, and an "offline" variety, which can be transfered without being cleared, but is only verifiable when finally cleared, by revealing any the clearing nym of any intermediate holder who transfered the object multiple times (a breach of contract).

To implement a full transaction of payment for services, we need more than just the digital cash protocol; we need a protocol that guarantees that service will be rendered if payment is made, and vice versa

A credential is a claim made by one party about another. A positive credential is one the second party would prefer to reveal, such as a degree from a prestigious school, while that party would prefer not to reveal a negative credential such as a bad credit rating.

A Chaumian credential is a cryptographic protocol for proving one possesses claims made about onself by other nyms, without revealing linkages between those nyms. It's based around the is-a-person credential the true name credential, used to prove the linkage of otherwise unlinkable nyms, and to prevent the transfer of nyms between parties.

Another form of credential is bearer credential, a digital bearer instrument where the object is a credential. Here the second party in the claim refers to any bearer -- the claim is tied only to the reputable name of issuing organization, not to the nym or true name of the party holding the credential.

Smart Property We can extend the concept of smart contracts to property. Smart property might be created by embedding smart contracts in physical objects. These embedded protocols would automatically give control of the keys for operating the property to the party who rightfully owns that property, based on the terms of the contract. For example, a car might be rendered inoperable unless the proper challenge-response protocol is completed with its rightful owner, preventing theft. If a loan was taken out to buy that car, and the owner failed to make payments, the smart contract could automatically invoke a lien, which returns control of the car keys to the bank. This "smart lien" might be much cheaper and more effective than a repo man. Also needed is a protocol to provably remove the lien when the loan has been paid off, as well as hardship and operational exceptions. For example, it would be rude to revoke operation of the car while it's doing 75 down the freeway.

Smart property is software or physical devices with the desired characteristics of ownership embedded into them; for example devices that can be rendered of far less value to parties who lack possesion of a key, as demonstrated via a zero knowledge interactive proof

One method of implementing smart property is thru operation necessary data (OND): data necessary to the operation of smart property.

A smart lien is the sharing of a smart property between parties, usually two parties called the owner and the lienholder.

Many parties, especially new entrants, may lack this reputation capital, and will thus need to be able to share their property with the bank via secure liens

What about extending the concept of contract to cover agreement to a prearranged set of tort laws? These tort laws would be defined by contracts between private arbitration and enforcement agencies, while customers would have a choice of jurisdictions in this system of free-market "governments".

If these privately practiced law organizations (PPLs for short) bear ultimate responsibility for the criminal activities of their customers, or need to insure lack of defection or future payments on the part of customers, they may in turn ask for liens against their customers, either in with contractual terms allowing arrest of customers under certain conditions

Other important areas of liability include consumer liability and property damage (including pollution). There need to mechanisms so that, for example, pollution damage to others' persons or property can be assessed, and liens should exist so that the polluter can be properly charged and the victims paid. Where pollution is quantifiable, as with SO2 emissions, markets can be set up to trade emission rights. The PPLs would have liens in place to monitor their customer's emissions and assess fees where emission rights have been exceeded.

s. Euclidean space

metric space

topological space

Physical space is the extension surrounding a point

My presentation of a general theory of living systems will employ two sorts of spaces in which they may exist, physical or geographical space and conceptual or abstracted spaces

Physical or geographical space

Euclidean space

distance

moving