Sunday, September 9, 2018

Zipf's law: causes & derivable from Pareto

I specified the relationship between Pareto and Zipf distributions in wikipedia:


Wikipedia's excuse for Zipf's prevalence:


Preferential Attachment
A simple, common, and possibly accurate view is that there is a preferential attachment ("the rich get richer") going on, e.g. people are more strongly attracted to large cities because there are more opportunities. A common math example for preferential attachment is the Yule process.

Yule process
This is one of the best contenders for explaining Zipf's law and other Pareto (power law) distributions. In biology, the number of species in a genus (or members of a specie?) seems to follow a Yule process that results in a Pareto (power law) in its long tail. This process says a new specie is more likely to form in proportion to the number of species in that genera. It's a simple "the big get bigger in proportion to their size".  It assumes that no species die out. If that condition were included, its tail probably dies off quicker, which is seen in realistic data. Overall, this process gives a hump, or at least a dip at the front end, that is commonly seen in real-world data in their log-log plots. Zipf's law is rho = 0.

Deviation of Front and Tail from straight-line log-log plots
A simple power law such as Pareto (the continuous form of Zipf's) is a straight line on a log-log plot.  But most real data forms a hump, possibly more than the Yule process.  So the front and tail ends dip down from the straight line. The preferential attachment idea is amenable to this: after cities get beyond a certain size, there are drawbacks. If it's not beyond a certain size, there's no benefit to from the limited ability to cooperate.  If a word is used too often, it's not conveying information.  If  a word is used too rarely, no one understands it.  So a double Pareto has been suggested, to cover the front and back tails, but it gives too much of a sharp hump in the middle, so it seems a triple Pareto (power law) would be better. But in many cases, a primary Pareto with a secondary Pareto for the head or tail adjustment might be close enough to the best possible.

BTW,  Zipf-Madelbrot is simply a slightly more general form of Zipf's law, throwing in another constant that might be used to create a more general Pareto distribution (continuous form) by scaling it in a way that results in a CDF =1 at infinity.

This chapter  by a physicist is excellent.

This paper says Zipf law works because it is half way between order and disorder.  It normalized entropy per character is 1/2, half the maximum possible. (At N=100 it's 0.37 and at N=1,000 it's 0.44, using  normalized entropy = H(CDF)/log(N) in a spreadsheet).


Other possible explanations for Zipf's law
Zipf's law usually refers to systems that have an exponent of s = 1. The reason for this simple 1/rank is considered a mystery for a long time. A lot of theories have been proposed (two possibilities are mentioned above, but I don't know if they were s = 1).

An IEEE article (with more comments here) claims many experts say Metcalf's law should be that the "value" of the network is N*log(N) instead of N^2 and that this gives rise to Zipf's law. N^2 assumes the value of every additional connection is the same with every node connected to every other node. Log(N) allows loss in efficiency of the connections as the number of nodes increases. They point out the harmonic sum 1+1/2+1/3+ ... 1/N =~ ln(N) + 0.577. This is not surprising since the integral of 1/x is ln(x).So the network gives ln(N)+0.577 value to each of the N nodes, so the total network value is N*[ln(N)+0.577]. But the node math can't be converted (at least directly) to words and city populations because the nodes have an equal number of connections and the same distributions.  Maybe ideas (for words) or occupations (for city populations) could be treated like nodes. Maybe cities or words could be treated as different networks.



Tuesday, September 4, 2018

Analaogy between Gravity/Momentum and Magnetism/Electrostatics

There is a bewildering array of different ways to find mathematical analogies between mechanics and electromagnetism. Feynman discusses analogues to electrostatics, stating at least that part of the analogies is possibly merely the result of everything needing to be calculated in terms of space, and since vector math is the best way to deal with it, the equations will naturally come out similar. (The vector math of curl, divergence, and gradient should show up a lot.) For a simple example, the 1/R^2 rule shows up a lot. It is the strength of something at a distance R from a point source of some quantity.  The source is emitting "rays" of some sort that spread out as you get further from the source. If the quantity we're interested is proportional to the number of rays per surface area of an imaginary sphere of radius R, then we have a 1/R^2 rule.  It shows up in gravity, electrostatics, sound intensity, and the probability P per second of getting hit by a bullet from a madman (point source) firing N bullets per second in completely random 3D directions. 

Wikipedia has a bunch of analogies between mechanical and electrical systems but the most natural one seems to be the first one mentioned, the Impedance_analogy. It's presented as 4 different substitutions, but it looked like there should be a simple source of the relationships.  I noticed simply replacing charge movement (current)  with "meters movement" (velocity) would derive the relationships.  Replacing charge with meters is a bizarre idea which could explain why respectable sources do not seem to mention this connection.

Two basic electricity equations are:

V = L di/dt
i = 1/J dV/dt

V = volts
L = inductance
i = q/second
q = charge
1/J = C = capacitance

The charge => meters substitution gives valid analogous relationships:

F = M dv/dt
v = 1/K dF/dt

F = force
M = mass
v = x/second
x = meters
K = Hook's law

These equations extend to valid energy equations:
E = 1/2 J q^2  (capacitive energy)
E = 1/2 K x^2  (spring energy)
E = 1/2 L i^2  (inductive energy)
E = 1/2 M v^2 (kinetic energy)

Separating a capacitor's plates by distance x does not result in the spring equation. The analogy works because as a charge q is moved the distance across a capacitor's dielectric, there's not only a V force it's resisting, but it's presence once it's there increases the voltage for future charges trying to move against it. 

The most interesting possibility is a deep parallel between L and M because L is just the result of how charge flows. It creates a self-interacting magnetic field and magnetism (in a non-quantum world) can be derived from q and relativity, i.e. L is not a thing in and of itself in the way we normally think of mass being something "real". L is just the result of q being forced to flow in a self-interacting way  We know the kinetic energy is also the result of relativity increasing the mass as velocity increases.  Is mass just as fictitious as L? It's interesting that inductors are in the same shape as a spring. Is mass in some sense have a capacitor shape? We know in relativity the distance shortens in the direction of travel. This leads to the idea than areas of like charge are like capacitor plates being pushed together and this is the source of how extra energy is being stored when you accelerate a mass. Inertia would just be the force needed to push like charges closer together, although the plate view is not supposed to be the correct view because as I mentioned capacitor energy is not the result of plates pushed together. 

The above are the integrals over either a charge or distance. In other words, these are the derivatives of the above:

V = J*q
F = K*x
magnetic flux = L*i
momentum = M*v

J = 1/C is the difficulty with which q can move onto the capacitor, and K is the difficulty with which "distance can move onto a spring".  Similarly Mass and inductance are difficulty to increasing v and i.

i is to magnetic flux what v is to momentum. We think of pushing charges through inductors, so maybe we should think of moving meters through mass instead of moving a mass through meters.   

Two more equations to point out:

E = F*x
E = V*q

Electrical: Moving charges are confined in a spatial arrangement that we call an inductor. If we try to accelerate them, we encounter a push-back. If we overcome the push-back so that they move faster, it will cause the inductor to have a higher internal energy. (The inductor can be thought of as a superconducting  toroidal type.

Mechanical: "Moving meters" are confined (via charges?) in a an arrangement  we call mass. If we try to accelerate them, we encounter a push-back from their "self-inductance". If we overcome the push-back so that they move faster, it will cause the mass to have a higher internal energy.

To go deeper, I would like to insert v in place of i in Maxwell's equations because Einstein said Maxwell's equations are a great filter for weeding out false theoretical ideas because all relativistic ideas are subject to them. But a straight substitution into Maxwell's equations would seem to have a problem. Maxwell's equations are all about spatial relationships. Throwing in an extra spatial dimension to replace charge seems drastic. Do I exchange an x and q instead of replace the q?

Notice in the all the charge equations above, meters were not present except implied in say J or L.

Will it require somehow replacing the 3D spatial system of the equations with some kind of 3D charge system?  To be clear, this means there would be some sort of 3D "charge-space".  I was once told spatial dimensions are the result of quantum spin and I know spin is at the charge level, so I did a quick Google search for "spin charge" which showed electrons consist of 3 quasi-particles. Are the 3 quasiparticles related to charge in a way that is analogous to how the 3 spatial dimensions' are related to mass? 

Maxwell's equations can be derived from the idea of point charge emitting rays of force in 3D space, and them using relativity to generate the magnetic pair of equations. Magnetism = a relativistic effect of charges (Feynman and Schwartz cover this, but I didn't learn it from school, but came across it in a 1930's Encyclopedia Britannica before looking for it elsewhere). Magnetism is perpendicular to the movement of charge in space.  

Thursday, August 30, 2018

Chinese threat of > 50%

The biggest potential of BTC in the near term is for banks to view it
as good as gold, and hold it accordingly, especially as the dollar
collapses from the U.S. not having a manufacturing base (7% of the
population) and the world no longer needing to finance the US.
military by cycling their trade surpluses into U.S. treasuries that
make the deficit spending possible that makes the military possible.
The dollar house of cards should fall fast because the world "needs"
the last remaining support column, U.S. consumption, less and less.

But BTC is not tenable as a replacement currency if the Chinese
government can tell >50% of miners what to do, or produce enough
mining equipment to get that >50% in a dozen months. They are so
aggressive with solar (with its collapsing costs), no one will be able
to compete with them in electricity. But their ability to be cheapest
mining community has given the Chinese government a zero-cost
infrastructure they can take over at any time. If BTC stands in the
way of the the RMB copying the dollar's play book, they will have no
qualms in using the mining power at a loss to quash it. Only by
squashing it will they be able to dictate trade terms to the rest of
the world in the same way the U.S. military & dollar enabled the U.S.
since even before 1971. Their ability to control BTC's POW should reduce European
and U.S. banks' desire to rely on BTC as if it were gold.

BTW, I do not mean to downplay BTC's importance by equating it with gold: when the
dollar-led fiat bubble collapses, gold-like stuff should shine as it has at the beginning of any monetary collapse and wars.

The Chinese control the BTC mining equipment, and has the cheapest electricity. The shift
to fees does not change anything: China will still have the
POW that can dictate what the ledger says, choosing
txns more easily than the U.S. has been able to place embargos on countries that get
out of line. They need to only act like the U.S. for it to be a disaster for most of us.

The Chinese government may have little interest in BTC,
even if leaving it alone would be their best option. (It would be
because they have the manufacturing base and everyone rising together
would allow them to rise higher than the U.S. IMF/world bank play book allowed us).
But no government or people seems to have been that enlightened when
they have had such a large edge. It seems like they may follow the U.S.
and U.K empires' and guide the world towards the RMB, first
by being the world's greatest producer with the greatest trade
surplus, and then by letting the manufacturing base slip away via the drug
of currency "surplus" and trade deficit.

BTC can't go against the desires of China to an extent that's greater
than China's unwillingness to dictate terms to its mining community.  That
does not seem like a very great barrier. So BTC playing a supporting role to RMB dominance is a real possibility thanks to "might is right" POW mining. 

Bitcoiner's are all about capitalistic free markets and no welfare state, and yet they have a "kumbaya" feeling for a worldwide community-without-government consensus to define a world currency. But at its core is POW which is not a popular vote, or a vote for what's best for the world. It's based on power. If that power gets concentrated, then evolutionary rules replace consensus.  If China remains strong enough to maintain > 50% and if its government acts in a way to coordinate its miners, the rest of the world will be proven evolutionarily weak. It will be an example of really free market weeding out the weak, thanks to the absence of a world government that might have protected the weak via laws and a power outside of the blockchain.

Can BTC be made to prevent China from dictating the POW results?
There is such acrimony shown to forked clones that have so little
community and dev support, it would seem no one believes a
state-sponsored clone, backed by a tweet army, would have much trouble
in replacing BTC. China is the only one who could do this in addition
to POWing the real BTC into worthlessness.

Tuesday, August 28, 2018

Chinese investment in Africa

Much of the Chinese investment in Africa is probably good for Africa, like some of the West's investment in the 3rd world. But the instances of over-charging for infrastructure development (such as the Railway the FT mentions) creates an indebtedness that is also reminiscent of the U.S. model, especially the IMF/world bank play book, as long as the debt to China is in RMB or USD. Debt in local fiat is far better for Africa, as it gives them the option of printing away (inflating) the debt, giving a fiat to China that China can only off-load by spending on things from that same country, employing it's people and businesses. The "inflating away" is not a a total cheat because China can use it to gain some control over that country's people. But it does motivate china to not make bad loans, motivating them to remain interested in the productive success of whatever the loans were for, so that the debt does not need to be inflated away.

Africa investment in USD is alternative to risky U.S. treasury debt. They have to offload excess USD from U.S-China trade imbalance. They can't buy U.S. stocks & real estate. To repay loans, Africa will give resources to China, exported on those same over-priced railways.

If most the money (RMB or USD) is spent on Chinese intellect or labor, they don't even lose the money "loaned"...it goes back to China....so the resources are obtained for the cost of the infrastructure in a way that keeps their trade surplus.

China is graduating 10x more engineers per year than U.S. and building about 10 tons per year per U.S. citizen in its infrastructure. If it continues to grow 3% per year faster than U.S. for the next 40 years (as I expect), that will be 1.03^40 = 3.2x bigger than it is now, compared to U.S. They are not likely to lose their empire edge as fast as Spain, U.K., and U.S. did in prior centuries because they really understand the economics and importance of protectionism better than we ever did. They will not let their manufacturing base slip away as easily as the U.S. did.

But even China is irrelevant compared to on-going rise of the machines.

Thursday, August 16, 2018

Microscopic gravity-powered mechanical computer

This post can be of general interest, but I need it as background reference material for a future article about cryptocurrencies.

A mechanical, gravity-based bit
Let's say that a bit in our system is a ball in a box instead of electrons stored on a capacitor or magnetic domains stored on a ferro-magnetic material.  A 0 or 1 is if the ball is or is not in the box.  For our ball to remain in the box, it must have at least a 50% chance of not being bumped out of the box by thermal agitations. This is the basis of Landauer's principle. The energy needed to do this according to the principle is E1 = k*T*ln(2) where k = 1.38E-23 = Boltzmann's constant and T = absolute temperature in Kelvins.  At room temperature T = 300 so that E1= 3E-21. This is very close to a van der Waals force, which is an attraction so weak it's not considered a bond. Hydrogen bonds are the weakest of attractions called bonds and are not considered permanent in water, due to the polar nature of water and thermal agitations. They are from 2x to 20x stronger. So the Landauer limit is unrealistically low. Covalent bonds are about 200x stronger, and ionic bonds are about 400x to 2000x stronger. In a computer we need a LOT more reliability than 50% chance of the ball being in the box.  If we use E2 as our energy barrier, frequency of a bit escaping out is f = f0 * e^(-E2/E1). See Arrhenius equation (E1 for this part should be k*T, 30% larger than k*T*ln(2)). f0 is the frequency of thermal vibrations in the crystal which is on the order of 10THz for silicon, the structure I'll make this CPU out of. 10 THz is a great overestimate of what I'll need because the balls I'll use are bouncing off the surface so that only a portion of the vibrations are imparting energy.  Let's say I'll make it a nice big CPU with really high reliability. Say 100 million NAND gates with about 2 energy wells per gate and Ill allow 1 error per 10 years, so I want "f" error rate = 1 per 10yr*8670 hrs/sec*3600 sec/hrs*100 million gates*2 wells/gate.Rearranging gives E2/E1 = -ln(f/f0).  For these numbers, I get E2 needs to be > 70 * E1. E1 here is 30% less than my E1=k*T*ln(2), so E2 > 100 * E1. so it appears the strength can be like a weak covalent bond, which makes sense, assuming covalent bonds in air at normal T & P conditions almost never break.

If the ball has a mass in kg of "m", then the height "h" of the walls in meters has to follow the E2 = mgh equation to determine the h necessary to store the ball in the box (g=10 for gravity on Earth).   If I use balls that are 50 billion atoms of gold, E2 = 100*3E-21 = 50E9*1.66E-27 kg/amu*198 amu/goldAtom*(g=10)*h.  Solving gives height of wall = 1.8 microns. The diameter of the ball is 1.2 microns.

Mechanical NAND Gate

This will show that a logic circuit making the simplest single calculation must use the same amount of energy as storing a bit. This is obvious if you already understand entropy and its relation to energy because 2 bits of energy come in and 1 goes out, so the other bit must have turned into heat. That's the minimum energy expenditure for a logic function, not counting esoteric reversible logic.

But that's not enough for my goal. My goal is to show the fundamental physics basis of all the deep parallels between economics and computing.

A single type of many different gates (like NAND, XOR, Toffoli, Fredkin, etc) can (and have) form a complete computer.  The NAND is the usual one used, so I'll use that one. I only need to design a single NAND gate for my purpose, and let others decided how to use them to build a computer.

The balls shown are defined in the bit section above. The pink lines are tubes that return the balls to a pump (not shown) that returns them to the top.

I accidentally made an AND gate instead of NAND gate, but this will show the general idea. This is lacking in detail that I could only fix by building a physical model or with 3D software.

The left-side balance goes down only when there are 2 balls on the left side. It's not shown, but the input has two slots.  Only 1 is shown because we are looking at the side view.  The output can also have more than 1 output.  The balls being stored at the top is a system-wide potential energy well that powers the computer, like voltage drives electrons. There is a rectangular counterweight on the balance equal to the weight of 1 ball.  If 2 balls come in on the inputs, causing the left balance to fall, closing the output . If only 1 ball comes in the top, it is basically back up to its initial level, and there is a mechanism to roll them out of the way to clear the gate for the next computation.



The green and red bars represent walls that go up and down (valves). CPUs are engines going through a cycle, so it's natural they have valves.  They have to be synchronized with a clock. They go down to let previous balls out.. They close after all balls have had time to get in place, in the entire computer. They can weigh much less than the balls and can be mechanically linked so that thermal vibrations cancel each other in trying to raise and lower the individual valves.

The cycle is: green valves open, balance resets. Green valves close, red valves opens. Red valves close. Inputs applied to "highest-level" NAND gates, which has a cascade effect of triggering all the NAND gates that it should. It takes some time to propagate as the appropriate balances fall. Repeat (green valves open).

Each level is the "well" that makes sure we know what state the balls are in: they are deep enough that we know the balls will not bounce out. When 2 balls come into the inputs, the balls fall two levels.  This is a total of 4 units of energy calculated in the previous section that gives me a guaranteed bit, so in 1 cycle, 4 units were used. If no balls come in, zero.  If 1 ball comes in, 1 unit.  There are 4 possible states: 0 balls, 1 ball in "left" side, 1 ball in "right" side, and both balls.  According to Landauer limit, it should average 1 unit of energy, and here I have used (0+1+1+4)/4 = 1.5 units.  One way to help is to let only 1 ball out at the bottom when 2 balls come, so the other can be helped to get back up 1 of the two levels. A more complicated design and arguments might be able to use the counterweight in a might help further.

There are two balls at the top which help push balls into the top compartment when the red valve goes down. This means I have to raise the balls a little more than the top floor. There needs to be at least as many as the number of red valves. The deeper the top layer of balls, the faster they will be pushed into place, enabling a faster computer but requiring more energy since the balls have to be raise higher. Also, the computer has to wait on the balls to fall which depends on force of gravity. If they were magnetically pulled down to fall faster, this would make it faster, but again require more energy.  Also, the wedges needed to get the balls out will force it to require a deeper gravity, again requiring more energy per gate per operation.  This seems to show a connection to the Margolus–Levitin theorem aka Bremermann's limit which says a bit can transition from one state to the next with a combination of more energy and more time.
bits  = 4Et/h
where E = energy, t = time, and h =Planck's constant.   So if E is higher, the time per bit can be less.

Clock Speed: The central clock will have a massive ball raised and lowered based on the clock that provides the energy to raise and lower the light-weight green walls..The clock speed is based on how quickly the balls can fall h which is based on h = 1.8 micon = 1/2*g*t^2 which gives t = 0.007 seconds on Earth where g=10. A clock cycle is at least 2x this which makes this a 750 Hz machine.  I could have chosen heavier balls to get an h as low as 1 nm which gives 28 kHz.

"Transistor" Density?
Four transistors are needed to create a NAND gate. It looks like my NAND gate will take up about 10x30 microns. This gives me about 1.3 million "transistor equivalents" in 1 cm^2 of material.

Memory
Memory may be built more simply, but two NAND gates can be wired as a flip flow to create bit storage.

Wednesday, July 25, 2018

Jeff Hawkins & Numenta brain theories catching up with mine


=====
In response to https://medium.com/@Numenta/the-secret-to-strong-ai-61d153e26273

I believe you're getting close to discovering the postulate I posted to your old forum about 7 years ago (after reading your book and watching your video of a helicopter) is probably true. 6 degrees of freedom are necessary to see movement of 3D objects in 3D space. My postulate is that the cortex is 6 layers because it is modelling this. The cortex is like millions or billions of groups of 6 equations (each minicolumn?) constantly receiving 6 unknowns and immediately solving to form a 3D world perception. This theory makes an observational prediction that I researched, confirmed, and I believe posted to your forum. I thought "what animal might see a 2D world?" The first thought is ants. An additional piece of potential observational evidence came to mind: wasps are very close cousins to ants. Sure enough, ant eyes have only 2 layers of neuronal support, while wasps have 6 because they see objects and fly in 3D. Going back to the wiki equation for degrees of freedom, you'll find only 2 degrees of freedom are needed to solve for a 2D world. Ants "see" and handle 3D objects with their feelers and two front legs....both of which have 6 layers. The exact number of layers in their brains may be debatable, but I'm in the ball park of the truth.
There are no integers in physics except for the 3D of space and fractional spins, which I'm told are the deeper basis of 3D space. These integers are deeply suspicious. Einstein and Bertrand Russell agreed that physics can be ultimately no more than a reflection of our minds. You argued against going down this rabbit hole that no great thinker has been able to come out of, and yet you are close to shedding light on it. 10 layers are needed to model movement of 4D objects in 4D space. What we see as velocity of an object would be seen as a static object to such a brain. Accelerations would velocities. Mass and energy would probably be defined differently, and I believe E=mc^2 in 4D space would be E=mc^3.
=====
My  response to https://medium.com/@Numenta/the-thousand-brains-model-of-intelligence-f1a70a6adf9c
It sounds like you’re describing a holographic model of the brain, which is very far from new terminology, but your model s *literally* a holographic model of the physical world. [This again parallels a very new and profound view of the universe, the holohgraphic Universe, further adding support to Einstein and Bertrand Russell's viewpoint.]
=====
Each mini-column in a column might be forming an opinion as to a part of an object's position and movement in space-time (the objects might be as nebulous as things like "Microsoft" and "love", not just physical objects with physical mass in physical space, but still restricted to a 3 dimensions of "position" like microsoft's relation to other companies, but keeping probably keeping the time dimension unchanged). Each mini-column might be gathering data from other columns outside its own, different from other sister mini-columns, trying to form an opinion. They then maybe take a local kind of vote within their column to draw a conclusion.

Saturday, July 21, 2018

Thoughts on Chamas

see also a previous post of mine that's similar to chamas:
https://www.blogger.com/blogger.g?blogID=4301173651018456758#editor/target=post;postID=5025527914896973587

Posts to Chamapesa telegram:

I think the biggest potential here is nested chamas going up a heirarchy for larger-scale investment and governance. The leader of a chama would form a chama with other leaders, all the way up to a global scale like city-county-province-nation.  The heirachy would need the ability to tax sub-ordinate chamas for building of mutually beneficial infrastructure such as roads, education, and utilities (especially telecom). But then a check and balance system like the U.S. government would be needed as the taxes could be diverted to enrich and entrench the heirarchy.
===========
Zawy, [20.07.18 08:17]
Rewarding users to gaurantee others seems like it may cause expansion in an unhealthy way. The unwanted bias may be small, but it may not exceed the benefit. It's paying to extend trust, but trust should flow the other way, from users to the app.  If 10 chamas guarentee each other up to their total assets, then can each chama issue an inter-chama currency equal to their individual assets plus the guarantees so that the total system is like 10x reserve banking.   As in U.S. mortgage lending, the chama would hold a promissary note from the  borrower of the inter-chama-currency as an asset to balance its books.  The borrower can then spend it to employ the inter-chama members or other locals accepting it who have the app but are not in a chama.  The champesa app on the non-chama locals phone would validate that the currency is backed appropriately. A former chama member could buy his way back in by working for the currency.  The borrower's business collects local fiat of the inter-chama currency to pay off the loan.  At the end, the extra inter-chama currency equals the increase in inter-chama real assets.

Zawy, [20.07.18 08:24]
But the reserve multiplier does not increase unless the guarantees are changed.  The guarantees in this scheme would need to automatically reduce if the assets decrease. Notifying locals of the excessive reserve before accepting the currnecy would need to be part of chamapeas so that its reputation is not hurt.
================

Zawy, [20.07.18 08:17]
Rewarding users to gaurantee others seems like it may cause expansion in an unhealthy way. The unwanted bias may be small, but it may not exceed the benefit. It's paying to extend trust, but trust should flow the other way, from users to the app.  If 10 chamas guarentee each other up to their total assets, then can each chama issue an inter-chama currency equal to their individual assets plus the guarantees so that the total system is like 10x reserve banking.   As in U.S. mortgage lending, the chama would hold a promissary note from the  borrower of the inter-chama-currency as an asset to balance its books.  The borrower can then spend it to employ the inter-chama members or other locals accepting it who have the app but are not in a chama.  The champesa app on the non-chama locals phone would validate that the currency is backed appropriately. A former chama member could buy his way back in by working for the currency.  The borrower's business collects local fiat of the inter-chama currency to pay off the loan.  At the end, the extra inter-chama currency equals the increase in inter-chama real assets.

Zawy, [20.07.18 08:24]
But the reserve multiplier does not increase unless the guarantees are changed.  The guarantees in this scheme would need to automatically reduce if the assets decrease. Notifying locals of the excessive reserve before accepting the currnecy would need to be part of chamapeas so that its reputation is not hurt.

Zawy, [20.07.18 08:59]
It sounds like the chamacoin is exclusively a control / profit / encouraged_expansion mechanism, not directly helping the chama.  Large, early-adopting Chamas will need more Chamacoin in storage.  I don't think it should be like this: neither large nor early adopting should benefit (pyramid accusation). It sounds like a huge speculation motivater for the early chamas. I think the Chamacoin should expand as it's use expands. Chamas could be paid to join in proportion to the guarantee provided by the existing chamas. You are loaning them chama to get started based on your trust of them.  If the new chama sells its chamacoin on the open market, the chamacoin gaurantee is burned.  If the market price of chamacoin decreases or increases, existing holders of chamacoin should have a percentage of their existing coin decrease or increase in order to keep constant value.  a 2% inflation rate might be good, maybe going to the devs.  2% inflation is a slow system-wide debt cancellation that effectively replaces the ancient traditions of jubilee (periodic erasure of all  debts to dis-empower the entrenched wealthy). At 2% inflation, the welathy have to invest wisely or lose value from trying to keep a store of value without putting it to use for a societal good. So you don't change fees or conversion rates.  You expand and contract the chamacoin.

Zawy, [20.07.18 09:27]
I think the ICO should sell Solidus shares for ETH or BTC which is then used for ERC-20 / chamacoin and salaries and founder's reward, which is distributed 1/3 now and 1/3 per year via nLocktime for 2 years.  Chamas would dictate the fees the devs receive.  Solidus should be employed by the chamas.  The connected chamas would vote as a whole how much your "governing tax" should be.

Zawy, [20.07.18 09:54]
Chamas could then write inter-chama contracts in terms of a constant-value chamacoin.  Large, trusted chamas are paid more to enter the system.  The 2% per year of total assets might be enough to support Solidus.  That leaves the question of "how can the fees be used to improve trust, trust metrics, and expansion" which would help both the existing chamas and solidus. (but not paying member or chamas to enter any more than existing chamas are putting skin in the game.  The fee is a tax that should build infrastructure..a given heirarchy of Chamas (built out of leaders from the subordinate chamas) could choose their own tax rate and the chamas at the top would function as local "government" building roads and education

Zawy, [20.07.18 10:07]
Maybe the heirarchy and/or peer-level chamas would vote to set conversion rates between the chamacoin to make sure the assets/chamacoin ratio for each type of asset is accurate.
=============
That last paragraph saying the chamacoin will be used for trade between chamas tells me everything I siad about increasing and decreasing the supply of chamacoin is the way to go.  ERC-20 tokens can be made minable with a difficulty adjustment, so it can be accomplished automatically, but 51% attacks are possible. So it seems the chamas have to check each others' assets to make sure the amount of reserve chamacoin they hold is proportional to those assets.  This way the chamacoin is fundamentally a measure of the value of assets under the control of the chamas.   As the assets increase system-wide, more chamacoin has to be minted in order to keep constant value so that their inter-chama contracts remain valid.  It can be given to the devs, to existing chamas in proportion to current chamacoin holdings, or to attract new chamas.  If the chamacoin starts being used as a local currency or attracts the interest of westerners due to stability, then its market price increases, so the difficulty setting or solidus, or a vote from the chamas could detrmine how much chamacoin to mint in order to keep constant value so that their contracts remain valid. The expansion in the use of the coin outside of the chamas increases its demand, and the chamas get to use the minted ccoin to buy more assets from the local community for free...it's a dividend payout  for creating a succesful constant value currency that the external world wants. This is exactly what the U.S. has done with the dollar since 1971. Solidus only needs to take the smallest of cuts, like 0.1% to be massively successful.  It should focus on serving the chamas, and stay away from as much patriarchal / colonistic stuff as possible. The videos imply this is the initial direction.  But anytime solidus sets a parameter value, a red flag should go off. The parameters, except for the 0.1% should be set by the chamas, but the apps should faciliate education in the chamas about what the big goal is.....for example, why minting too much goes against the constitution, or social contract they are making with the external world. (constant value and letting any valid chamas join just as easily as the first chamas)

Zawy, [21.07.18 07:36]
I've described two sources of a change in value: the assets that are under control of the chamacoin and external demand for it (in effect more external assets are falling under its control). There is a 3rd aspect that could eventually become a problem.

Zawy, [21.07.18 08:10]
The chamas could evolve into an elite class by controlling more and more assets faster than new members join.  The existing chamas might eventually vote to try to make it harder to join once the chamacoin becomes a desirable currency. The chamas would find it more profitable to act like the U.S. and big banks (harking back to U.K and bank of London) and we'd have a situation like today: rather than allowing people who love your currency to join your country (chama system), you "enslave" them simply by printing more coin in proportion to the increase in the assets that are coming under control of the coin.  So the app might be like an enforcer of egalitarian constitutional law (new entrants have equal rights in joining due to their love of your coin). Or have competing  app clones that prevent a completely dominant coin from arising. I believe Hayak said competing currencies were the best we can do.  This implies competing countries, i.e. different imlpementations or parameter settings  of chamapesa for groups of chamas who have selected different different system-wide rules.  I've already described this "enslaving" aspect as a benefit that will help motivate new members to join: they will see existing chamas getting more wealthy due to the coin being demanded outside the chama, enriching the chama. So it seems to be needed to an extent for expansion.  Existing chamas will need more members and other chamas less and less due to increasing wealth as the coin is adopted. It may be that the app should not prevent the initial Chama members from becoming the controlling dominant members of local society. But if they go that route, chamacoin would not be able to replace the dollar as they will be stifling their local society's growth and expansion of the coin's use.  A chamcoin that does not expand in proportion to the assets it controls is not a currency.

Zawy, [21.07.18 07:36]
I've described two sources of a change in value: the assets that are under control of the chamacoin and external demand for it (in effect more external assets are falling under its control). There is a 3rd aspect that could eventually become a problem.

Zawy, [21.07.18 08:10]
The chamas could evolve into an elite class by controlling more and more assets faster than new members join.  The existing chamas might eventually vote to try to make it harder to join once the chamacoin becomes a desirable currency. The chamas would find it more profitable to act like the U.S. and big banks (harking back to U.K and bank of London) and we'd have a situation like today: rather than allowing people who love your currency to join your country (chama system), you "enslave" them simply by printing more coin in proportion to the increase in the assets that are coming under control of the coin.  So the app might be like an enforcer of egalitarian constitutional law (new entrants have equal rights in joining due to their love of your coin). Or have competing  app clones that prevent a completely dominant coin from arising. I believe Hayak said competing currencies were the best we can do.  This implies competing countries, i.e. different imlpementations or parameter settings  of chamapesa for groups of chamas who have selected different different system-wide rules.  I've already described this "enslaving" aspect as a benefit that will help motivate new members to join: they will see existing chamas getting more wealthy due to the coin being demanded outside the chama, enriching the chama. So it seems to be needed to an extent for expansion.  Existing chamas will need more members and other chamas less and less due to increasing wealth as the coin is adopted. It may be that the app should not prevent the initial Chama members from becoming the controlling dominant members of local society. But if they go that route, chamacoin would not be able to replace the dollar as they will be stifling their local society's growth and expansion of the coin's use.  A chamcoin that does not expand in proportion to the assets it controls is not a currency.

Zawy, [21.07.18 08:31]
I don't think there's much of a learning curve for the chamas except to understand how to generalize what they're already doing to a wider set of contracts. It's not just chamas that crypto people would have a hard time understanding, but your ideas on ricardian contracts and trust are beyond their scope.  Someone like Vitalik would need to motivate more crypto people to get involved.  But like I'm saying, I have a fundamental problem with the current chamacoin plan like I do with bitcoin: they are an asset like gold, not a currency, and assets prices are not necessarily a part of the real economy. gold is good only in stable or declining economies....i.e. they are good only if the quantity of assets under its control is stable or decreasing.  So you're going to have to constantly adjust settings tied to chamacoin to be able to expand, and I have not seen in your comments any reference to the importance of interacting contracts all being deonominated in a single stable curerncy.

Zawy, [21.07.18 07:36]
I've described two sources of a change in value: the assets that are under control of the chamacoin and external demand for it (in effect more external assets are falling under its control). There is a 3rd aspect that could eventually become a problem.

Zawy, [21.07.18 08:10]
The chamas could evolve into an elite class by controlling more and more assets faster than new members join.  The existing chamas might eventually vote to try to make it harder to join once the chamacoin becomes a desirable currency. The chamas would find it more profitable to act like the U.S. and big banks (harking back to U.K and bank of London) and we'd have a situation like today: rather than allowing people who love your currency to join your country (chama system), you "enslave" them simply by printing more coin in proportion to the increase in the assets that are coming under control of the coin.  So the app might be like an enforcer of egalitarian constitutional law (new entrants have equal rights in joining due to their love of your coin). Or have competing  app clones that prevent a completely dominant coin from arising. I believe Hayak said competing currencies were the best we can do.  This implies competing countries, i.e. different imlpementations or parameter settings  of chamapesa for groups of chamas who have selected different different system-wide rules.  I've already described this "enslaving" aspect as a benefit that will help motivate new members to join: they will see existing chamas getting more wealthy due to the coin being demanded outside the chama, enriching the chama. So it seems to be needed to an extent for expansion.  Existing chamas will need more members and other chamas less and less due to increasing wealth as the coin is adopted. It may be that the app should not prevent the initial Chama members from becoming the controlling dominant members of local society. But if they go that route, chamacoin would not be able to replace the dollar as they will be stifling their local society's growth and expansion of the coin's use.  A chamcoin that does not expand in proportion to the assets it controls is not a currency.

Zawy, [21.07.18 08:31]
I don't think there's much of a learning curve for the chamas except to understand how to generalize what they're already doing to a wider set of contracts. It's not just chamas that crypto people would have a hard time understanding, but your ideas on ricardian contracts and trust are beyond their scope.  Someone like Vitalik would need to motivate more crypto people to get involved.  But like I'm saying, I have a fundamental problem with the current chamacoin plan like I do with bitcoin: they are an asset like gold, not a currency, and assets prices are not necessarily a part of the real economy. gold is good only in stable or declining economies....i.e. they are good only if the quantity of assets under its control is stable or decreasing.  So you're going to have to constantly adjust settings tied to chamacoin to be able to expand, and I have not seen in your comments any reference to the importance of interacting contracts all being deonominated in a single stable curerncy.

Zawy, [21.07.18 08:37]
The currency quantity should be proportional to the number of "joules" in the assets   (under the coin's control)   that society has expended to get them.  More precisely, the current "joule" value of the assets.  So economizing agents such as people competing to control the assets society posesses is simplified to trying to obtained the currency, enabling them to focus on and measure their "local" immediate goals, enabling an invisible hand to work for the larger common good.

Zawy, [21.07.18 08:38]
society in the above means "the society of law" (interacting contracts) that are deonominated in the currency

Zawy, [21.07.18 07:36]
I've described two sources of a change in value: the assets that are under control of the chamacoin and external demand for it (in effect more external assets are falling under its control). There is a 3rd aspect that could eventually become a problem.

Zawy, [21.07.18 08:10]
The chamas could evolve into an elite class by controlling more and more assets faster than new members join.  The existing chamas might eventually vote to try to make it harder to join once the chamacoin becomes a desirable currency. The chamas would find it more profitable to act like the U.S. and big banks (harking back to U.K and bank of London) and we'd have a situation like today: rather than allowing people who love your currency to join your country (chama system), you "enslave" them simply by printing more coin in proportion to the increase in the assets that are coming under control of the coin.  So the app might be like an enforcer of egalitarian constitutional law (new entrants have equal rights in joining due to their love of your coin). Or have competing  app clones that prevent a completely dominant coin from arising. I believe Hayak said competing currencies were the best we can do.  This implies competing countries, i.e. different imlpementations or parameter settings  of chamapesa for groups of chamas who have selected different different system-wide rules.  I've already described this "enslaving" aspect as a benefit that will help motivate new members to join: they will see existing chamas getting more wealthy due to the coin being demanded outside the chama, enriching the chama. So it seems to be needed to an extent for expansion.  Existing chamas will need more members and other chamas less and less due to increasing wealth as the coin is adopted. It may be that the app should not prevent the initial Chama members from becoming the controlling dominant members of local society. But if they go that route, chamacoin would not be able to replace the dollar as they will be stifling their local society's growth and expansion of the coin's use.  A chamcoin that does not expand in proportion to the assets it controls is not a currency.

Zawy, [21.07.18 08:31]
I don't think there's much of a learning curve for the chamas except to understand how to generalize what they're already doing to a wider set of contracts. It's not just chamas that crypto people would have a hard time understanding, but your ideas on ricardian contracts and trust are beyond their scope.  Someone like Vitalik would need to motivate more crypto people to get involved.  But like I'm saying, I have a fundamental problem with the current chamacoin plan like I do with bitcoin: they are an asset like gold, not a currency, and assets prices are not necessarily a part of the real economy. gold is good only in stable or declining economies....i.e. they are good only if the quantity of assets under its control is stable or decreasing.  So you're going to have to constantly adjust settings tied to chamacoin to be able to expand, and I have not seen in your comments any reference to the importance of interacting contracts all being deonominated in a single stable curerncy.

Zawy, [21.07.18 08:37]
The currency quantity should be proportional to the number of "joules" in the assets   (under the coin's control)   that society has expended to get them.  More precisely, the current "joule" value of the assets.  So economizing agents such as people competing to control the assets society posesses is simplified to trying to obtained the currency, enabling them to focus on and measure their "local" immediate goals, enabling an invisible hand to work for the larger common good.

Zawy, [21.07.18 08:38]
society in the above means "the society of law" (interacting contracts) that are deonominated in the currency

Zawy, [21.07.18 09:06]
Explosions in real GDP only occur when currency is not deonomited in gold.  Societies falling apart turn to gold.  By enforcing a gold-like coin as a currency, growth is stifled.  It's going to be more complicated for chamas to understand the fees and everything if the value of chamacoin is changing relative to the local currency.    It would be nice if chamas of different countries could directly trade contracts based on their value in Chamacoin.  Turning to the dollar as an international standard has drawbacks as demonstrated by BRICs trying to get off of it. Chamacoin could be pegged to the dollar, or maybe a year-2018-dollar and adjust according to a basket of commodities.  If the GDP of the chama-system increases, then more chamacoin would have to be printed in order to keep constant value.  This seems simlper, not more complex.
Zawy, [21.07.18 07:36]
I've described two sources of a change in value: the assets that are under control of the chamacoin and external demand for it (in effect more external assets are falling under its control). There is a 3rd aspect that could eventually become a problem.

Zawy, [21.07.18 08:10]
The chamas could evolve into an elite class by controlling more and more assets faster than new members join.  The existing chamas might eventually vote to try to make it harder to join once the chamacoin becomes a desirable currency. The chamas would find it more profitable to act like the U.S. and big banks (harking back to U.K and bank of London) and we'd have a situation like today: rather than allowing people who love your currency to join your country (chama system), you "enslave" them simply by printing more coin in proportion to the increase in the assets that are coming under control of the coin.  So the app might be like an enforcer of egalitarian constitutional law (new entrants have equal rights in joining due to their love of your coin). Or have competing  app clones that prevent a completely dominant coin from arising. I believe Hayak said competing currencies were the best we can do.  This implies competing countries, i.e. different imlpementations or parameter settings  of chamapesa for groups of chamas who have selected different different system-wide rules.  I've already described this "enslaving" aspect as a benefit that will help motivate new members to join: they will see existing chamas getting more wealthy due to the coin being demanded outside the chama, enriching the chama. So it seems to be needed to an extent for expansion.  Existing chamas will need more members and other chamas less and less due to increasing wealth as the coin is adopted. It may be that the app should not prevent the initial Chama members from becoming the controlling dominant members of local society. But if they go that route, chamacoin would not be able to replace the dollar as they will be stifling their local society's growth and expansion of the coin's use.  A chamcoin that does not expand in proportion to the assets it controls is not a currency.

Zawy, [21.07.18 08:31]
I don't think there's much of a learning curve for the chamas except to understand how to generalize what they're already doing to a wider set of contracts. It's not just chamas that crypto people would have a hard time understanding, but your ideas on ricardian contracts and trust are beyond their scope.  Someone like Vitalik would need to motivate more crypto people to get involved.  But like I'm saying, I have a fundamental problem with the current chamacoin plan like I do with bitcoin: they are an asset like gold, not a currency, and assets prices are not necessarily a part of the real economy. gold is good only in stable or declining economies....i.e. they are good only if the quantity of assets under its control is stable or decreasing.  So you're going to have to constantly adjust settings tied to chamacoin to be able to expand, and I have not seen in your comments any reference to the importance of interacting contracts all being deonominated in a single stable curerncy.

Zawy, [21.07.18 08:37]
The currency quantity should be proportional to the number of "joules" in the assets   (under the coin's control)   that society has expended to get them.  More precisely, the current "joule" value of the assets.  So economizing agents such as people competing to control the assets society posesses is simplified to trying to obtained the currency, enabling them to focus on and measure their "local" immediate goals, enabling an invisible hand to work for the larger common good.

Zawy, [21.07.18 08:38]
society in the above means "the society of law" (interacting contracts) that are deonominated in the currency

Zawy, [21.07.18 09:06]
Explosions in real GDP only occur when currency is not deonomited in gold.  Societies falling apart turn to gold.  By enforcing a gold-like coin as a currency, growth is stifled.  It's going to be more complicated for chamas to understand the fees and everything if the value of chamacoin is changing relative to the local currency.    It would be nice if chamas of different countries could directly trade contracts based on their value in Chamacoin.  Turning to the dollar as an international standard has drawbacks as demonstrated by BRICs trying to get off of it. Chamacoin could be pegged to the dollar, or maybe a year-2018-dollar and adjust according to a basket of commodities.  If the GDP of the chama-system increases, then more chamacoin would have to be printed in order to keep constant value.  This seems simlper, not more complex.

Zawy, [21.07.18 09:08]
I guess gold is OK if the value at the time is constant (the expanding GDP using is not large compared to the amount of gold avalable)

Zawy, [21.07.18 07:36]
I've described two sources of a change in value: the assets that are under control of the chamacoin and external demand for it (in effect more external assets are falling under its control). There is a 3rd aspect that could eventually become a problem.

Zawy, [21.07.18 08:10]
The chamas could evolve into an elite class by controlling more and more assets faster than new members join.  The existing chamas might eventually vote to try to make it harder to join once the chamacoin becomes a desirable currency. The chamas would find it more profitable to act like the U.S. and big banks (harking back to U.K and bank of London) and we'd have a situation like today: rather than allowing people who love your currency to join your country (chama system), you "enslave" them simply by printing more coin in proportion to the increase in the assets that are coming under control of the coin.  So the app might be like an enforcer of egalitarian constitutional law (new entrants have equal rights in joining due to their love of your coin). Or have competing  app clones that prevent a completely dominant coin from arising. I believe Hayak said competing currencies were the best we can do.  This implies competing countries, i.e. different imlpementations or parameter settings  of chamapesa for groups of chamas who have selected different different system-wide rules.  I've already described this "enslaving" aspect as a benefit that will help motivate new members to join: they will see existing chamas getting more wealthy due to the coin being demanded outside the chama, enriching the chama. So it seems to be needed to an extent for expansion.  Existing chamas will need more members and other chamas less and less due to increasing wealth as the coin is adopted. It may be that the app should not prevent the initial Chama members from becoming the controlling dominant members of local society. But if they go that route, chamacoin would not be able to replace the dollar as they will be stifling their local society's growth and expansion of the coin's use.  A chamcoin that does not expand in proportion to the assets it controls is not a currency.

Zawy, [21.07.18 08:31]
I don't think there's much of a learning curve for the chamas except to understand how to generalize what they're already doing to a wider set of contracts. It's not just chamas that crypto people would have a hard time understanding, but your ideas on ricardian contracts and trust are beyond their scope.  Someone like Vitalik would need to motivate more crypto people to get involved.  But like I'm saying, I have a fundamental problem with the current chamacoin plan like I do with bitcoin: they are an asset like gold, not a currency, and assets prices are not necessarily a part of the real economy. gold is good only in stable or declining economies....i.e. they are good only if the quantity of assets under its control is stable or decreasing.  So you're going to have to constantly adjust settings tied to chamacoin to be able to expand, and I have not seen in your comments any reference to the importance of interacting contracts all being deonominated in a single stable curerncy.

Zawy, [21.07.18 08:37]
The currency quantity should be proportional to the number of "joules" in the assets   (under the coin's control)   that society has expended to get them.  More precisely, the current "joule" value of the assets.  So economizing agents such as people competing to control the assets society posesses is simplified to trying to obtained the currency, enabling them to focus on and measure their "local" immediate goals, enabling an invisible hand to work for the larger common good.

Zawy, [21.07.18 08:38]
society in the above means "the society of law" (interacting contracts) that are deonominated in the currency

Zawy, [21.07.18 09:06]
Explosions in real GDP only occur when currency is not deonomited in gold.  Societies falling apart turn to gold.  By enforcing a gold-like coin as a currency, growth is stifled.  It's going to be more complicated for chamas to understand the fees and everything if the value of chamacoin is changing relative to the local currency.    It would be nice if chamas of different countries could directly trade contracts based on their value in Chamacoin.  Turning to the dollar as an international standard has drawbacks as demonstrated by BRICs trying to get off of it. Chamacoin could be pegged to the dollar, or maybe a year-2018-dollar and adjust according to a basket of commodities.  If the GDP of the chama-system increases, then more chamacoin would have to be printed in order to keep constant value.  This seems simlper, not more complex.

Zawy, [21.07.18 09:08]
I guess gold is OK if the value at the time is constant (the expanding GDP using is not large compared to the amount of gold avalable)

Zawy, [21.07.18 09:39]
A house insurance group in the U.S. could loan chamacoins to kenya chamas who promise a return of 7% per year instead of the 5% per month they charge each other.  We are penalized 30% if we call in the note early. For example, we convert dollars to chamacoins the first two years and have an excess of funds, so we loan it out for a profit.  But it has to be a stable coin pegged to US. dollars so the U.S. holders know how much value they have.  We would hopefully not need to worry about itemizing the capital gains on exchange trades, other than the 7%.

Zawy, [21.07.18 09:51]
The cross-chama activity seems like the primary attraction to using the app.  I was hoping it was possible to treat a "sister chama" in the app exacly like just another member of the chama, to make it easier for everyone to understand what's going on (and simplify the programming).  The only way I would loan to chamas in kenya is if I don't have to deal with the risk of loss due to chamacoin price changes.  It seems like solidus could print and sell chamacoins when the price goes high, and buy when it goes low.

Zawy, [21.07.18 09:56]
I can't be a member of a chama in kenya?  The app requires members  to be physically present? What was the benefit of that?

Zawy, [21.07.18 07:36]
I've described two sources of a change in value: the assets that are under control of the chamacoin and external demand for it (in effect more external assets are falling under its control). There is a 3rd aspect that could eventually become a problem.

Zawy, [21.07.18 08:10]
The chamas could evolve into an elite class by controlling more and more assets faster than new members join.  The existing chamas might eventually vote to try to make it harder to join once the chamacoin becomes a desirable currency. The chamas would find it more profitable to act like the U.S. and big banks (harking back to U.K and bank of London) and we'd have a situation like today: rather than allowing people who love your currency to join your country (chama system), you "enslave" them simply by printing more coin in proportion to the increase in the assets that are coming under control of the coin.  So the app might be like an enforcer of egalitarian constitutional law (new entrants have equal rights in joining due to their love of your coin). Or have competing  app clones that prevent a completely dominant coin from arising. I believe Hayak said competing currencies were the best we can do.  This implies competing countries, i.e. different imlpementations or parameter settings  of chamapesa for groups of chamas who have selected different different system-wide rules.  I've already described this "enslaving" aspect as a benefit that will help motivate new members to join: they will see existing chamas getting more wealthy due to the coin being demanded outside the chama, enriching the chama. So it seems to be needed to an extent for expansion.  Existing chamas will need more members and other chamas less and less due to increasing wealth as the coin is adopted. It may be that the app should not prevent the initial Chama members from becoming the controlling dominant members of local society. But if they go that route, chamacoin would not be able to replace the dollar as they will be stifling their local society's growth and expansion of the coin's use.  A chamcoin that does not expand in proportion to the assets it controls is not a currency.

Zawy, [21.07.18 08:31]
I don't think there's much of a learning curve for the chamas except to understand how to generalize what they're already doing to a wider set of contracts. It's not just chamas that crypto people would have a hard time understanding, but your ideas on ricardian contracts and trust are beyond their scope.  Someone like Vitalik would need to motivate more crypto people to get involved.  But like I'm saying, I have a fundamental problem with the current chamacoin plan like I do with bitcoin: they are an asset like gold, not a currency, and assets prices are not necessarily a part of the real economy. gold is good only in stable or declining economies....i.e. they are good only if the quantity of assets under its control is stable or decreasing.  So you're going to have to constantly adjust settings tied to chamacoin to be able to expand, and I have not seen in your comments any reference to the importance of interacting contracts all being deonominated in a single stable curerncy.

Zawy, [21.07.18 08:37]
The currency quantity should be proportional to the number of "joules" in the assets   (under the coin's control)   that society has expended to get them.  More precisely, the current "joule" value of the assets.  So economizing agents such as people competing to control the assets society posesses is simplified to trying to obtained the currency, enabling them to focus on and measure their "local" immediate goals, enabling an invisible hand to work for the larger common good.

Zawy, [21.07.18 08:38]
society in the above means "the society of law" (interacting contracts) that are deonominated in the currency

Zawy, [21.07.18 09:06]
Explosions in real GDP only occur when currency is not deonomited in gold.  Societies falling apart turn to gold.  By enforcing a gold-like coin as a currency, growth is stifled.  It's going to be more complicated for chamas to understand the fees and everything if the value of chamacoin is changing relative to the local currency.    It would be nice if chamas of different countries could directly trade contracts based on their value in Chamacoin.  Turning to the dollar as an international standard has drawbacks as demonstrated by BRICs trying to get off of it. Chamacoin could be pegged to the dollar, or maybe a year-2018-dollar and adjust according to a basket of commodities.  If the GDP of the chama-system increases, then more chamacoin would have to be printed in order to keep constant value.  This seems simlper, not more complex.

Zawy, [21.07.18 09:08]
I guess gold is OK if the value at the time is constant (the expanding GDP using is not large compared to the amount of gold avalable)

Zawy, [21.07.18 09:39]
A house insurance group in the U.S. could loan chamacoins to kenya chamas who promise a return of 7% per year instead of the 5% per month they charge each other.  We are penalized 30% if we call in the note early. For example, we convert dollars to chamacoins the first two years and have an excess of funds, so we loan it out for a profit.  But it has to be a stable coin pegged to US. dollars so the U.S. holders know how much value they have.  We would hopefully not need to worry about itemizing the capital gains on exchange trades, other than the 7%.

pesa mic, [21.07.18 09:41]
[In reply to Zawy]
Cross chama loans is a great use case.

Just to build on your example

Could be a diaspora chama investing back home

Investment could be a loan with a 7% return on loan to a chama in makueni with a farm project going on

Zawy, [21.07.18 09:51]
The cross-chama activity seems like the primary attraction to using the app.  I was hoping it was possible to treat a "sister chama" in the app exacly like just another member of the chama, to make it easier for everyone to understand what's going on (and simplify the programming).  The only way I would loan to chamas in kenya is if I don't have to deal with the risk of loss due to chamacoin price changes.  It seems like solidus could print and sell chamacoins when the price goes high, and buy when it goes low.

Zawy, [21.07.18 09:56]
I can't be a member of a chama in kenya?  The app requires members  to be physically present? What was the benefit of that?

Zawy, [21.07.18 10:41] An important requirement of the constant value I've described seems to be that the assets "backing" the chamacoin quantity do not merely exist in the chama, but need to be "contractually encumbered" in an amount expressed in the coin.   I guess the chamacoin itself does not need to be the constant value coin.
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I have spent $1 to thousands on a shipments fom China or India via western union, usually based on their existence on Alibaba with a few users reporting good results. I don't use the Alibaba system for any sort of protection. We just chat to reach an agreement.  The result is getting items at 3/4 or less the price of ebay, aliexpress, or Amazon. But usually the reason I use it is because the items are not available anywhere else. I would not be able to trust a chama as much, unless it is part of a heirarchical chama system where the top level is like Amazon or Alaibaba top-level management. They could have a lot of trust-points built up from other American customers. Idealistically, those americans would be in a similar interconnected group of chamas so their reviews can be trusted, as opposed to me having to rely on a central for-profit database (alibaba) to not be "hacked" for good reviews.  We would similar costs in transmitting money if exchanging dollars for chama. The Chamacoins are not constant value, so they can't be a part of savings, but a speculative bet/investment. Partly "bet" because the structure is pyramidic which in my theoretical perspective probably benefits early adopters in some way at the expense of late adopters rather than being a straight-forward capital investment that benefits society from the extra real capital. Repeating myself more briefly: Limiting quantity in and of itself may not create real physical capital for society.  There's no added potential energy (infrastructure) or kinetic energy in proportion to the early adopters profit, unless the limiting of quantity adds an intellectual property to society that makes more efficient use of existing or created societal Potential + Kinetic energy. So you must have a belief that limited quanity inherently and directly increases real societal intellectual property or admit it's not beneficial to society as a whole (i.e. it's an unethcial characterisitc), assuming you believe like me that more available P+K energy per person is the only measurable "good" we can rely on. For example, less crime and more ethical behavior increases this number because those are intellectual properties that increase efficient use of the energy, and are therefore add to the "free energy" (lower entropy) that Schrodinger cited as the answer to "What is Life?".  I have only one suggested possibility for how limitde quantity can be an intellectual property to society: by relying on greed, it advances itself in order to create a greater good.  This seems to be a very tenuous ethic.  So my theory is that the chamacoin as a currency strangles its own growth in exchange for massive profits early on.  I can't prove this logically other than the foregoing because you can change the fee structure. But at least it looks like there is more direct evidence than my large-scale view point: the minimal strangling would be from reduced transparency via complexity and the additional required trust of Solidus. I started typing only to try to mention there might be a way for Solidus to generalize its ideas to include my transactions with China (replace things like Amazon, Ebay, and Aibaba).  It seems to me they are just centralized databases that encourage indentity and trust for the execution of Ricardian contracts. I see no reason why you can't include a currency that's capable of replacing the centralized creators and mediators of the value metric (U.S. dollar and pay pal/exchanges) that is core to those contracts. Although your software development would be a point of centralization of the protocol (but not actual data) that would replace them.

My original intent was to point out I am like a client to an alibaba chama. I am not a chama of one because they do not need to extend trust to me or identify me, So there are one-way-trust transactions that the app should encourage.  By shooting two orders of magnitude above Solidus's current goals, the app should be that much simpler.
=========
From my viewpoint, what I've said is simple. My brain does not work that well so I've had to compress ideas so that they fit inside.  I am forced to apply Occam's razor more often. But compression  (Occam's razor) has been said to be equivalent to intelligence.  Your description of Ricardian constracts seems much more general than a specific name implies, so I think of  it "non-smart crypto contracts".  We're stuck with the "smart" contract name instead of "computer-deterministic" contracts, but it makes a good joke-like meme.  This new name could have a huge marketing benefit.   Maybe the goal of the chamapesa app is to be a suite of smart contracts that enables a suite of non-smart contracts.  The chama as an entity is foced/enabled by the app to adhere "smart contracts" (the app's protocol). I'm taking a big liberty here calling the app programming a suite of smart contracts, but maybe the programming can or should go in that direction. The programming at least utilizes ERC-20. So the chama is forced/enabled to act like a predictable machine for reliable connections with similar "machines". Internally the machine is human So the mechanized chamas can orgainze and focus (via constant currency) the non-cyber, non-smart contract world of people.
==== begin chama connection to A.I. ===
 I want to add an A.I. connection here in addition to my grand physics connection viewpoint.  The chama, thanks to the app, has the potential to act like a machine-level economic agent in a system of cooperating and competing agents. People have tried to program these agents on computers for A.I. purposes to achieve goals (usually to increase "intellectual property" but thereoretically machines could be programmed to nicrease their access to more computing hardware and electrical energy). But it's good to point out a larger parallel: neural and bayesian nets emulate the brain with great success. Both of these consist of connected "nodes" with "weightings" (aka probabilities) between the nodes in order to take complex data and classify (compress it).  The parallel to brains is nuerons with weightings determined by synapses.   I think of chamas as the nodes and the contracts between them as the connections. Some nuerons have more contracts with other nuerons.  The rate of electrical signals passing between the nodes or neurons is like the rate of money moving between chamas. Food energy and electrical energy are universal constant valued currencies between the nodes. Companies are like nodes. Companies work out the complicated trust issues with its employees internally.
== Begin chama parallel to brain. ===
People are like synapses: the synapses are complicated, messy, and very fluid in their individual weightings, but they are precisely where the metal hits the road. Non-smart contracts are in the synapses. Smart contracts are the longer-term inputs and outputs (dendrites and axons). Dendritic inputs have a large number of synapses, while axonic ouptuts are fewer and reach much futher (to the leaders of other chamas).
 === End connection with brain ====
==== end connection with A.I.  ====
In brains and A.I., there is a limited amount of infrastructure and energy to utilize. Even world GDP does not change that much, so a near-constant amount of currency is the rule in these systems.  But a rapidly expanding business model that seeks to expand the number of nodes under its scheme either has to be subservient to a larger scheme, or issue its on currency in proportion to its quickly rising "GDP" (rate of synapse firing).  I previously said it needs to be proportional to existing assets under its control (under contract?).   Either rate of transaction value transmission (synapse firing rate) is (or should be made to be)  proportional to these assets, or vice versa, or I was wrong and currency in existence needs to be based on transaction value rate.  Asset value can get disconnected from the real economy due to speculation.  Fees can help by discouraging fictitious transactions that could seek to increase the amount of currency issued.

Brains and A.I. seek to get more efficient at classifying aka compressing data which results in using less resources to achieve the same goals. There is intellectual property in the connections. But evolving economic systems not only seek to economize, but to expand. Economize => expand => economize => expand. A top-level governing mechanism like the Chamapesa app might be designed to use the individual's greed to enabling it's expansion in order to "take over the world". It could come at a cost to the individual. Or the individuals might find more immediate profit in designing the app in a way that slows the expansion.  But the hope is that expansion can be done in a way that helps the app expand in a way that helps the individuals and the whole of human society. Experience shows that intelligent cooperation and competition between everyone results in maximal benefit to at least the system itself, if not the individual's in it.  Individuals seek to do no work which is contrary to being a part of the most powerful economic system that will replace other systems.  China might be an example of a system using the devaluation of its currency in order to motivate its people to work harder, replacing other systems that allow more laziness. I think of the highest evenly distributed wealth per person as a desirable good which is something like my vision for chamapesa seeks, but it's not necessarily compatible with what evolution (physics) seeks.

=== Going off-topic into Evolution, Entropy, and Rise of the Machines ==
Evolution creates economizing systems made of durable, replicating devices that acquire and use energy, emitting more and more entropy to the universe while trying to increase the mass under its control which is accomplished by creating mass with the lowest entropy per mass (or per mole).  Low entropy per mass or atom is approximately equal to the hardness of  the substances. Stone tools were the first machines. It is not a coincidence that stones have a very low entropy per atom compared to biology.  Even lower entropies per atom are achieved with silicon, carbon nanotubes, and metals.Cement is probably about like rocks.  Silicon and carbon nanotubes have the lowest  and this is directly realted to why they are (or will be) crucial in thinking machines and solar energy: they can command and control not just other atoms like rocks and ions and molecules like brains do, but also electrons.  The movement of electrons on on thinking machines is replacing the more cumbersome movement of ions and molecules in brains. The difference in actual weight of the items being moved in the modelling of the external world's much larger objects is what makes computers much more efficient than brains. Our internal biology was not capable of smelting metals for use in order for brains to guide electrons. The metals and metalloids (silicon, germanium), by being very low entropy per atom, allow command and control of electrons. As a side note, cryptography relies on high entropy (randomized bits) to prevent command and control from outsiders.  Now we're slowly getting into the world of directing q-bits.....and the reduction in entropy per atom theory holds: we have to make the systems extremely cold in order to exist in the fewest states per atom (lower entropy).  My final point on this is that the physics of evolution implies it's not our happiness that is the end goal,. but a rise of the cold, hard machines.( And that the increasing emission rate of entropy as a result of this activity may be what underlies or directly enables the increasing rate of expansion in the Universe. )

=== Encouraging Competition and Openness within the Chama===
Getting back to my point: it would be good if Chamapesa could use A.I. ideas to optimally organize chamas and their relation to members in order to economize and grow.  A.I. parallels may fail on at how to grow rapidly because they are all about economizing existing resources. One possibility may have a difficult sell: maybe Chamas should encourage competition between members and reward them accordingly. This is probably a very touchy realm in things like companies where it would not be in A.I. (as evidenced by salaries not being common knowledge and politics). But it appears that in an idealistic chama, all members would have access to all information and there not be any "evil" politics. The app could encourage more professionalism in the Chama, another example where the architectural design of the Chama app can be influenced by governed economics and A.I. experience:  in both there is a definite effort to avoid becoming trapped in "local solutions".

=== "Government" in the app to Discourage non-optimal relationships ===
Democracy uses 1 vote per person to subvert the brutality of an overly free market that can lead to an excessively small and excessively wealthy class. The unequal wealth distribution can result from things monopolies even if every individual transaction is honest and fair.   This can occur even if the government remains ideal and free of the adverse effect of lobbies and cronyism.  It's not clear to me that a single super wealthy ruler and everyone else being slaves would not automatically (mathematically) result from a completely free, fair, and honest market place, especially since such a things means the slaves could not steal from or kill the master. So we invented democracy to enforce progressive taxation (which includes real estate taxes) for the purpose of financing socialistic welfare for things like roads, education, and police (the rich have to pay more than their fair share so that the poor can use these things for free).  The end result is a wider middle class that is capable of working more efficiently and paying for more commodity production which enables a bigger military force and more more diversity and intelligence in production, both of which enables it to replace the prior systems such as kingdoms. Obviously, the democratic vote should not carry the socialism too far: the smart wealthy need to have control of a lot of wealth in order to invest smartly.  In terms of chamas, they should be prevented from developing monopolies that hurt other groups of chamas. There is a parallel in A.I. The above is a good description of non-optimal localized solutions. A.I. usually has to "redistribute the wealth" in different ways.

== jumping back to deep and off-topic parallels ==
Higher commodity production would be like an A.I. that works to acquire more computing resources. Commodities can be broken down into kinetic (oil, gas, food) and potential (steel, cement) energies. Computing resources can be broken down into CPU (kinetic) and memory (potential) energies.  Memory bits are actually and really a potential energy according to Landuaer's principle Obviously CPUs need electricity which is kinetic, but like oil refining and cars, a CPU is a pre-existing infrastructure than accepts and converts energy for use. The kinetic/potential breakdown begs the question og "why 2?" and I suspect it has to do with the space-time duality

Addendum thoughts:
=== more lessons from the brain ===
Groups of synapses in brains called segments make predictions (Jeff Hawkins, Numenta).  I've said the Ricardian contract is like a synapse, but in my review of Numenta's HTM, I found synapses to seem to parallel people in a company, organized into divisions (called "segments" of synapses in the brain). People have transactions within their divisions a lot, with such a fuzzy and enforceless "contracts" (agreement) being made in each interaction. So the parallel might be that members of chamas are like segments and contracts are like synapses. Chamas wuold be individual neurons.  Synapses can be formed and eliminated very quickly, like contracts, and the money and products/services flowing through them are the electrical signals.  The social transactions occurring in a chama will far outweigh the actual contractual transactions (including simply money transfer). Aren't all transactions ultimately sourced from a prediction we are making? . The products and services are given in exchange are like nutrient that strengthen local "synaptic" connections.  Is there some way the app should help people improve their predictions, or help the money signal go and down up the hierarchy better?

I will continue along this line, but it's unlikely anyone remaining will be interested.  But a dreamy architecture may provide other ideas that might actually be implementable without much effort. 

Can chama interaction be like a brain? (no one can or should be too interested in the rest of this post ....kind of a personal note from which i might pick up later)
The app must be the DNA, aka the governing constitution, that designs synapses, segments, neurons, and columns. We know maybe 25% of how the columns generally work. We don't need much of the details because they're specific to biology to which we do not need to adhere. I'll repeat the architecture of the brain and see if it can be programmed into a "chama app". Synapses (contracts) have signals (usually money) flowing in 1 direction. Actual use strengthens the synapse, probably pulling in enough nutrients (physical commodities) and food energy (energy commodities) to create even more local synapses (like a successfully animal breeding, sex aside, or a successful division of a company getting more company resources). I originally thought (above) that people would therefore be segments of synapses, but maybe people should be at the neuron level and chamas at the cortical column level. This is because neurons in the same column can have synapses between them, but neurons will not have synapses between it's own dendrites and axons. This also shift the scale upward to make my goal a lot less ambitious and gives people more credit, moving them to the neuron level rather than mere single-prediction segments. So far, I've not brought anything to the chama app design table in this analogy, but now I'll try. A key to the higher-functioning mammal brain is 6 layers of neurons, capable of modelling 3D objects in space-time, where "objects" might be as nebulous as companies and love, as we've no doubt capitalized on what the mammalian brain is required to perceive to extend it to wider domains. Animal brains seem to group into 2 and 6 layered brains, coinciding with crawling (2D) and flying (3D) insects that require 2 and 6 degrees of freedom to model 2D and 3D worlds.  No animals have the 10 layers necessary for 4D spatial perceptions, so I would not shoot that far, yet. So if we build a chama app that guides members to form a 6-layered hierarchical "column" like the brain, then (if our design is correct) the contractual interactions (synapses) forming the hierarchy may evolve into something more efficient than if there were no guidance on the hierarchy. Hierarchy is a bad terminology because the 6-layered cortex is much more complex than top down. It is more like 'assigned tasks'. There are also mini-columns within columns.

Now let me reduce the dreaminess and show how the analogy may already exist in a company.  A division in a company (a minicolumn in a brain, or 6 people out of say 30 people in a chama) might have 6 workers: a marketer, a lawyer, and an accountant (acquirer of capital?), and 3 corresponding engineers that specialize in modifying widgets to point in one of these directions. In physics, the 6 degrees of freedom are needed to define 3 dimensions of translation (movement) and 3 possible rotations (the engineers) of an object. The object would be a widget or service within an economic space-time.  The space would define its distance and orientation to other widgets or services in the marketplace, which changes with time. Could legal, marketing, and accounting correspond to 3 spatial dimensions? Are they, or can they be made to be, orthogonal like they need to be for the most efficient computaton?  Can we rotate our widget and move it along one or more of these dimensions, so we can get out of a crowded marketplace of similar widgets?  Is there a better set of 3 dimensions?  Are our brains limited to 3 orthogonal dimensions in economic space-tmie?  The weight of the widget in these dimensions is how much it's married to its current position (this requires each widget to  define its current position in a static frame of reference, with other widgets moving to or from it, otherwise I would have to assign it a velocity). A very heavy widget would warp the economic space-time around it.

Besides the above questions, this may fail many quick checks of sanity. For example, most companies need only 1 lawyer, 1 marketer, and 1 accountant for even a wide variety of products. But then again, does this imply an optimal division in a company would need very specialized experts for a particular type of widget?  Should technology (and its corresponding engineers) not be dimension, or is it just the mechanics or details that satisfy the other dimensions?