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The Future of Money

The Future of Money. Dave Birch “Trash your Cash” Denmark, July2012. Not confidential in the least. Version 2, 7/7/12. 1. Introduction. OK, we could have some fun guessing about the future of money, or We could look at a future for financial services...

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The Future of Money

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  1. The Future of Money • Dave Birch • “Trash your Cash”Denmark, July2012 Not confidential in the least Version 2, 7/7/12 1

  2. Introduction • OK, we could have some fun guessing about the future of money, or • We could look at a future for financial services... • Using a scenario model developed for that purpose... • …and explore what it means for money Feel free to copy and distribute Version 2, 7/7/12 2

  3. Where are we now? Feel free to copy and distribute Version 1, 11/22/11 3

  4. The role of cash Feel free to copy and distribute Version 1, 11/22/11 4

  5. The future is already here, as they say Feel free to copy and distribute Version 1, 11/22/11 5

  6. Agenda • The “Long Finance” scenarios • The model and the four futures • The implications for money • Some educated speculation! • The prediction • A generation of change http://www.longfinance.net Feel free to copy and distribute Version 1, 11/22/11 6

  7. The “Long Finance” Model Feel free to copy and distribute Version 1, 11/22/11 7

  8. The “long hand” scenario Feel free to copy and distribute Version 1, 11/22/11 8

  9. Exploring the “long hand” The term Washington Consensus was coined in 1989 by the economist John Williamson to describe a set of ten relatively specific economic policy prescriptions that he considered constituted the "standard" reform package promoted by Washington, D.C.-based institutions such as the International Monetary Fund (IMF), World Bank, and the US Treasury Department but it has commonly come to be used in a second, broader sense, to refer to a more general orientation towards a strongly market-based approach (sometimes described, typically pejoratively, as market fundamentalism or neoliberalism). Feel free to copy and distribute Version 1, 11/22/11 9

  10. The “visible hand” Feel free to copy and distribute Version 1, 11/22/11 10

  11. Exploring the “visible hand” A world of “rugged individualism” appealing to knowledge workers who connect globally and generate value online, but would it lead to what Galbraith labelled private affluence and public squalor as the "real world" is abandoned to the underclass? Why would a knowledge worker invest effort in Zimbabwe rather than World of Warcraft or Facebook? Feel free to copy and distribute Version 1, 11/22/11 11

  12. The “second hand” Feel free to copy and distribute Version 1, 11/22/11 12

  13. Exploring the “second hand” This is the scenario where we remain rooted in the physical world despite all the talk about the “new frontier” and the declaration of cyberspace independence. Geography still matters, the Washington consensus holds and we manage to muddle through. Nation-states find it harder to provide for their citizens, who turns to companies instead. This could be seen as a corporatist future, where “Google Doubloons” replace national currencies. See “The IBM Dollar” by Edward de Bono. Feel free to copy and distribute Version 1, 11/22/11 13

  14. The “many hands” Feel free to copy and distribute Version 1, 11/22/11 14

  15. Exploring the “many hands” future This is a world that Jane Jacobs “Cities and the wealth of nations” would recognise, where a system of around 50 city-states form the economy and nation-states are relevant to tourism, history and sentiment only. Some 70% of the world’s population will live in cities. Feel free to copy and distribute Version 1, 11/22/11 15

  16. Many hands — London, Paris, NY, Munich... • Power shifts away from nations (and the “west”) to... cities Five new kinds of commerce Version 1, 11/22/11 16

  17. The seeds of “many hands” money • Communities are crucial • We’re all in multiple communities • New technology makes it easy for them to make money • M-PESA • Google Wallet • They’re longer geographic • Facebook Credit • Brixton Pound • Bitcoins Feel free to copy and distribute Version 1, 11/22/11 17

  18. Nations, regions, cities • Burgundy • Norrath • Wessex • Florence • Alt Clud • Litvia • Aragon • Hanseatic League Feel free to copy and distribute Version 1, 11/22/11 18

  19. The future of money is... revolution • The Industrial Revolution • The Glorious Revolution (1688) • The Bank of England (1694) • The Great Recoinage (1696) • The Act of Union (1701) • The Gold Standard (1717) • The Post-Industrial Revolution • The end of the Gold Standard (1971) • The collapse of the euro (2012) • ... Feel free to copy and distribute Version 1, 11/22/11 19

  20. Thank You • Dave Birchdave.birch@chyp.com(and @dgwbirch) Tomorrow’s Transactions:thought leadership from Consult Hyperion Read www.chyp.com/media/blog Listen www.chyp.com/media/podcasts Visit www.chyp.com Contact info@chyp.com Follow @chyppings How about this footer Version 2, 7/7/12 20

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