The Pure Cash Network

SmartCards exchange digits with each other, and no human can tamper.  So,Joe Blow takes his smart card and taps at the new coin  icon, on his computer. That software opens up a new web  betting site.  New currency is as simple as a new blog.

Joe Coins will compete with dollars, so Joe sets up the NGDP betting target.  Any other Smart Card that has Joe Coins can bet on the NGDP.  Joe takes out a loan of one Joe coin, and bets that the NGDP will be 7.  The BEA reports 18.7 Trillion, and Joe is the best bet, he wins his own coin .

Transaction costs are tiny, convenience is infinite. So a bunch of folks at the BEA go to the betting site to get coins, that is OK, Joe Coins like insider information.   Joe makes the BEA staff watch one ad to get one coin.

These insiders all bet on advanced information, they make the NGDP numbers, after all.  But even within this group, their is deviation about when and where the final number will be.  The bet has spread, and the spread narrows as the NGDP number gets composed.  We still get an even split between losers and winners, but the bot has to re-balance the betting tree, the graph which represents the possible NGDP bets, grouped by significance.  The betting tree has essentially monetized the BEA operations. The BEA staff likes the game, they split the bets generally.

Now semi outsiders, business and banks and large investment corporations pull out their smart cards and buy Joe Coins from the BEA staff, using dollars.  They want to use the betting tree as a hedge.  Joe Coins improve efficiency in inventory flow, But knowledge of BEA data as it com es in is great, the Atlanta Fed does that.  But the Bot will always dig into insider information..

Banker bot can be snookered, it loses and gains now and then.   This is because the bot currency risk equals the insider uncertainty, and this is shared by all betters.  The bot has to bet the 50/50 split, the balance point in the tree.  But transactions are quantized, they are maximum entropy,  So when uncertainty drops via insider betting, the bot will lose some spectral space, the maneuvering between the left and right branches.  Inflation and deflation  happen on the margin.

This all works because the terms are guaranteed tamper proof and transaction costs low and information published honestly.  That means card to card transaction only, Joe Blow has to plug his card into the web to run the betting site.

Why do businesses support Joe Coins over dollars?  Because banker bot attracts insider information, and monetizes it; thus neutralizing it.  This is a huge gain in  efficiency, this is the singularity.  This is a collection  of smart cards that are indexing all things humans consider important.

Tim Cook says we can do this on his telephones.  I say we got intelligent credit cards, no phone calls needed.