Item Banc is setting up to integrate smart contracts on the Blockchain for production of BHN (Basic Human Need) products.
The technology uses valuation information of the products from these contracts as input for the valuation to currency Item Banc Engine. This engine produces relative value information for BHN products with an end goal to provide valuation to currency information.
Item Banc
Comparing PPP (Purchasing Power Parity) concepts to Item Banc
The concept of Purchasing Power Parity focuses on a first assumption that similar products should have similar prices in each economy. This is commonly known as the “law of one price” going back to 1918 where the theory was that the same goods should be the same price when expressed in the same currency. The formula for this comparison is simply the price in one economy as a ratio of the price in another. If it turns out, for example, that the price of a good is three times more once converted to the same currency, then this is compared to the exchange rate between currencies. Given that the exchange rate between currencies is similar, then the price of the good is representative of the “law of one price” and should then be in equilibrium to markets via the exchange rate. If the good is five times more as compared to the exchange rate then the assumption is, based on the theory of PPP, that the good is more expensive in that economy. One good or a basket of goods can be used to compare products in various economies using PPP for the purpose of cost of living comparisons.
Item Banc exists for the purpose of creating relative values to currencies. Unlike PPP, the goal is not to express the value of goods as in the same currency. Neither is the assumption that there is one or should be one price for the same good. There is an underlying theory in Item Banc that goods carry a commodity or standard value, however, that value is the standard, not the currency. Similar but very different, this theory is a “law of market value”, not price, as value is recognized as relative to the economy environment. Value, in this expression, stays as a component of other goods and services within and external to an economy and not as a component of currency. Currency is speculative (traded as an item for profit in itself) and so absolutely cannot be used as any kind of theoretical valuation standard.
Relative value to currency created by Item Banc algorithms does create ratios representing prices of a basket of needed goods in one economy as a percentage of that same basket in another economy. The ratios are, however, modified and differentiated from PPP because they are based on weighted averages of quantities of needed product available to market. The basket of needed products (BHN – Basic Human Need products) are presented as a weighted proportion and then compared to another economy. These relative values are used only for this focused set of BHN products to create a guide for an economy comparison; a relative value to currency. IN this theory, it is the goods that determine relative value not the currency.
Requirements for Successful Implementation of Information Currency
A model for a new paradigm of currency named “Information Currency” depends on three technology-based market changes. First, we need a technology to create relative value systems as a yardstick for comparing products and services within and between economies. Second, products and services that are available for sale need to be capitalized, meaning simply that their availability and pricing in a specific time frame needs to be recorded in a free public database. Third, we need to implement existing systems of accounting and transaction engines designed for alternative currencies.
Our yardstick for comparing the values of products and services needs to start with a standard of value. A technology named “Item Banc” is designed to determine the valuation of a basket of needed goods within an economy. The relative value of this basket compared to one similar in another economy allows the system to derive a needed yardstick for a percentage comparison of value difference between economies. From these relative values we can derive market standards and values within economies can be derived. The products in the basket must be needed goods, or fit in a category of BHN, Basic Human Needs. They must be hard goods, and by definition, not targets for speculative markets. Item Banc must be free and open source. The technology needs to function with the input of bancs of information about products and value all over the world, but in similar format, and licensed as information bancs. The challenge for the technology is to compare categorization and naming systems of products so that the systems can speak abstractly in the same language all over the world. This technology is not able to function with barcodes, as these identify exact products by exact manufacturers. The technology is built to converse about naming systems for products in a more abstract sense, such as “Coffee”, “Lumber”, “Lentils”, “Toilet Paper”. The market valuation information produced by the engine is not meant to price products but to compare relative values of products in an economy and around the world in general.
Information Currency needs information about what is available where at what value. This capital value information exists in the markets now in a somewhat organized fashion related to land and real estate assets in the first world. This is how we derive comparables. This is how banks secure credit. In this new paradigm of information currency we need capital information about products and services as well, but framed in time. The easiest way to think of it is like a coupon. A product is available in this area this month for this price. A service is available in this economy this week for this price. Coupons can be digitized, as they are now. Then these coupons can be bought and sold, but more than that, the information about what is available where at what value (capital information) is recorded publicly. With capital information comes the ability for the markets to give credit…not just banks.
Finally, we need information systems that keep accounts for individuals and businesses and governments. These transaction and accounting systems exist in the market and are used every day for alternative currencies. In a new paradigm of Information Currency, these systems are required. Cyclos is one of these systems that is used all over the world and is open source. –Virginia Robertson, June 27, 2012
Independent Bancs
The Item Banc Engine is structured by a set of Commodity Bancs, or BHN Bancs, one in each economy, and a collection of independent bancs, owned by the commons, and designed to be a network of information managed by independent people groups or corporations within economies. An independent banc can specialize in a category of product information, or even in a product within an economy. The independent banc’s data sets are structured by Item Banc, and the engine interacts by design as needed. Each independent banc needs to be licensed primarily to maintain data integrity and be sure that data is managed consistently among bancs.
Item Banc Commodity Bancs, (those that report data on BHN basket products), operate in an economy more like a Banc of bancs for each economy, where data is validated for integrity, artificially intelligent naming systems compare data, and relative values to external economies are determined.
Item Banc independent bancs can harvest data using specialized search engines built into the open platform software or the independent banc can design its own to be integrated into the product. Licensing the software would require that additions or enhancements become part of the code and are shared.
Independent bancs can source data by alliances or cooperative agreements with wholesalers or manufacturers to connect in and share data. The data information is not identifying information and just used for calculations and so should not be viewed as competitive. This system to integrate into other platforms for data sharing is a necessary build-out for the Item Banc engine.
Item Banc: Technology for an Information Currency
What is Item Banc
Item Banc is a software program written for the commons to provide information about market value of products and services. Specifically, Item Banc produces information about relative values of goods and services between economies. The technology is designed to produce information about relative value of currencies for the purpose of enabling trade. Item Banc operates primarily on a core data set of needed, consumable commodities we refer to as BHN, or Basic Human Needs. This “basket” of goods represents the backing to this technology for an information currency.
How does it make money
The technology for Item Banc will make money because the information produced is of high value. The system does not directly charge for the information, but earns money via advertising on the site.
What is the proof
Many companies are producing strong revenues from bringing this type of information to market. For example, even prior to the internet, Random Lengths in Eugene, OR produced weekly reports on market price for lumber and sheet goods. The majority of building materials distributors in America buy this information every Friday. These distributors of lumber and plywood base their retail pricing on these market values.
Trade services provided similar information to their distributors back in the day when market values were passed along in pencil. Now the need has grown as technologies are necessary to interact with a large number of manufacturers and thousands of SKU’s (item numbers). Trade Services has evolved into the non-profit Idea corporation.
There is a “yellow page” produced for the vegetable oil industry and a highly integrated network for market prices in the automobile parts industry.
The need for instant market price information has moved to the iphone with highly used apps like Razor Technologies (bought out by ebay) and Quickscan.
How does it work
Item Banc sources product data about BHN items from random market samples within an economy until the sample sets are large enough. There are about one hundred core items in the BHN commodity set. This data is averaged related to first, each item and its availability and costing. Then a cross-average costing is created among the entire set of BHN data. This result is used to compare with another BHN data set in another economy. The percentage difference in values represents the percentage of difference in currency “market” value. That percentage can then be applied across the economy to other items to find relative market values. This information at each level has market appeal. The most powerful function, however, is the function that is unique to market, which is the ability of Item Banc to create a “backing” to a currency, or a “relative” value of currency to external markets and economies. This technology has the potential to compare an economy that uses literally “shells” as currency to a dollar based economy, thus enabling trade.
Price data is input from three major sources; live streams from product distributors within each economy, special internet search engines designed by Item Banc architects to validate streaming data and customer input in the field to validate data sets.
How does it look
Item Banc has a data input side that will interactively take in data live and streaming from distributors and also a consumer interface where an iphone user is rewarded when they enter a location and product price. The distributor and manufacturerer interface side works on the back-end, the internet search engines bring in data on the back end, but the front-end for input gives the consumer an impression that their data imput is the most valuable of all and is rewarded by advertisers coupons and free gifts.
The front-end for banc data delivers its information in words, graphics and numbers. A more robotic and interactive consumer interface is desired so that the customer/user feel is that this information is of high value.
Who benefits from Item Banc?
The technology for Item Banc is designed to benefit consumers, business, and government. Consumers use Item Banc to get information about value of products to assist in decisions to purchase by providing a market basis point of value. Business has proven to need market value information to know when to buy and at what price and when to sell. Item Banc offers an ability for business to stretch into new economies and use a basis point of market value to make best decisions. Technology for Item Banc is designed to open up currency-challenged economies to trade based on a new analysis of a country’s currency and product values to market.
How much would it cost to build it
Item Banc is designed to grow in the world of internet commons, where data given to the system is rewarded and data delivery can be edited by a user so that it makes more sense to their world and their economy. The initial design is of highest importance and requires investment in strong project managers and consulting as needed with a core programming staff of five. Development time to first market is estimated at a year and a half. $1.5 million is a first cost estimate, though it is possible to pare down to two programmers and cost less than one million.
Who owns it
Item Banc must be open source and owned by the commons. The investors in the project will be silent partners without company control but will keep a piece of ongoing revenues derived from advertising on the site. The company will be held in majority by a trust.
Why should you invest in it
Item Banc is fundamentally a technology that will bring greater value to all economies. Trade between economies is inhibited by a lack of information of what is available for trade at what value. Currency values can confuse this most important information as currency itself is a target for speculation. Currency in any economy is scarce, but when companies and consumers have external information about what is available for trade at what RELATIVE value then the scarcity of currency has less power.
Understanding Information Currency:
Moving to Rational Equalibrium
The impact of “live” availability and value information by item made available for free to the world is that efficiencies will happen by force of market. “Live” price information by
item will make commodities of these items which will allow the market to find rational equilibrium (approaching “value”) not only with the commodity items but also to general market equilibrium.
We can define rational equilibrium as the balance of averages of prices by location and around the world experienced when information about value and relative value of items
are known.
“Information Currency; The New Green”, Virginia Robertson
Paradigm Changes
Evidence of the paradigm change in currency is everywhere. First, I want to start with the basic piece of information about valuation that is now free and accessible to anyone. It may seem just every day and normal to think of something that you want to buy and then look it up on google or any price engine (like http://www.thefind.com) to get an IDEA OF THAT ITEM’S VALUE. This information is a critical beginning piece to information currency, that is, that items are becoming commoditized as more and more information about
availability and value are made known.
Known values then drive markets. Markets soon become slave to expectations, and consumers make choices based on values that they demand. The more information about
value and availability of items, the more consumers shift and pressure markets to meet a rational equilibrium.
As items become commodities they can be used and leveraged for trade without a dollar.
It soon is clear how a dollar can interfere in a balanced transaction. Anyone who has traded can relate to this. A dollar transaction has an inherent cost in addition to the
transaction. Another way to explain this is that a transaction using dollars is often significantly more expensive and less efficient than a barter or trade
transaction. This is easy to feel in a micro economy. A business person may be willing to trade services for a nice dinner. In fact, that same business person would not even think of spending his dollars on such an expensive dinner. Also, the restaurant owner was unable to afford the business person’s service. In trade, both are affordable and allow for new business efficiencies and luxuries that are not possible or affordable with dollars.
The cost of the dinner in dollars may be $100. This is unaffordable. If the cost of the dinner is some services, this is affordable and gains a new customer. The recorded dollar
“value” of that dinner then is in many ways inaccurate because it does not reflect the “value” of the dinner on trade. If values become comparable in trade, the inefficiencies of the dollar will soon be made completely obvious.
The new paradigm of information currency will become more evident as commoditization of products and services happens. This means that we will have more and more information about what is available where at what price and will know the value of that
product or service. As this change continues we will learn more about the relative value of our dollar.
Free Information will lead to the Commoditization of Products, and will Enable an Information Currency!
If I can start by defining a word that I will need to use a lot, the word is “commodity”. A simple definition is a product or service with a known value around the world. Sometimes the definition gets into the closer aspect of how the products need to be similar or homogenous. This is to me one of those “true but not true” statements as
commodities are never really exactly the same. Coffee is a commodity and highly differentiated. So are corn, pigs, yellow grease, wheat and on and on. Also, even though corn or wheat or coffee or oil may have a commodity price per barrel or per pound or bushel or head, this does not mean that that will be exactly the selling price for each
transaction. So why is it necessary or important to have a commodity price? Commodity value and relative value information (to other products or in time) allows us to have a better understanding of the buying power of our currency. The technology of Item Banc is designed to provide valuation information and to commoditize products. Transaction sets related to price as products are exchanged is a different application.
Another objection is when one cannot understand the dollar as purely information. Even some monetary theorists rest on the concept of the dollar simply as “credit”. Though I
may agree that the dollar can function as credit, what it IS matters here, and it IS and has proven to BE information. The dollar has a value…is a value that changes relative to what it can buy. The dollar today, you could say, functionally gave you credit to buy that
cup of coffee selling for $1. The dollar tomorrow, maybe, might not give you credit to buy that SAME cup of coffee because now it costs $1.10. In our reality it seems that it is not the fault of the dollar that it is the fault of the seller who raised the price from yesterday. But yet, from the perspective of a trader, or someone who is not used to using currency, it is evident that it is exactly the dollar that has changed because now it takes more of them to satisfy the owner of the coffee. An example may work here. If you took
ten eggs to the owner of the coffee yesterday and got the coffee, and today it took eleven, then there must be something less valuable about your eggs today relative to the value of
coffee than yesterday. So since we are so wired to measure the information about the value of goods and services based on a constant “1” dollar, we have been fooled into thinking that its value never changes. So how, then is the dollar information? Let’s go back to the eggs. When we had to pay one egg more then we had specific information
that eggs now are worth less relative to the value of coffee. If eggs were used to pay for everything, then we’d know a whole lot about the value of eggs relative to every kind of good and service. All that the eggs end up doing is providing information about value.
Yes, they function as credit to get coffee. But if we began to log the relative value of eggs compared to all kinds of goods every day and how this changes we would then know derived information, such as, if we traded eggs for pigs, then we might get a better deal by trading pigs for eggs. This information about relative value is so lost in our carrying of the dollar that we become washed up and only see the dollar as a vehicle for credit… its function… not how it gets there or if we should even use it!! It was to my benefit that some economics professor insisted on our universal definition of money in three parts:
Unit of Measure, Store of Value, and Medium of Exchange. So can the egg be a unit of measure, store of value and medium of exchange? Yes! Sure! Even an egg can provide information about relative value of goods and services. Now that we have experienced credit cards and exchange of goods and services based on a numbered and named account, we have already seen this piece of information related to held or stored value… information about value… I should say “relative value” as the dollar tomorrow may not buy that same cup of coffee.
The theory of information currency is first about a source of information related to relative values of goods and services that may be more dependable than the dollar. The information, in fact, would also be a credible source to create relative value to a currency.
This technology is built into the Item Banc. It seems to look like transactions could evolve from this set of information and would be trade based, if we define trade (or barter) as any transaction that does not use a currency. Or we could say that the
information available related to the relative value and availability of goods and services IS the currency. From this we can call it “information currency”.
Information Currency: The New Green
Virginia B. Robertson, 2011
Information as Capital:
Capitalizing Information about Products and Services
In developed countries land and buildings are capitalized, meaning, they are legally secured (ownership is assigned) and a relative or market
value is used as backing for transactions.
Item Banc engine will capitalize products and services by accounting for their ownership, value, and availability to market, using digital scrip services. Scrip is essentially a coupon with
a specific value to the holder toward a specific business or service. Each business that is analyzed by the Item Banc will be assigned a value in scrip, this value is specifically related to
the goods and or services currently available to the market per month.
This technology can enable the barter/trade industry to value or capitalize their client base, a
necessary piece to creating value to a trade currency. Item Banc will integrate technologies with digital couponing companies around the world for scrip transaction management that will
serve the barter industry. Companies that are members of trade exchanges will have an option to scrip out, or capitalize for market, the value of
their available goods and services on a monthly basis. This process will secure the trade exchanges as they are in turn capitalized by their clients.
The technology can also provide national economies with an option to capitalize their available goods and services in order to utilize the market information for trade.
Information Currency:
The New Green
by: Virginia Robertson
2011
Item Banc Software Technology Value Proposition
Item Banc is a software technology concept and design for a virtual bank that uses price and availability data to create and publish commodity-type product valuation information for commonly traded goods. The Item Banc uses this data to create valuation for a “basket of traded goods” to then bring to life an information-backed currency that is used in the Banc to account for barter exchange transactions. This “information currency” creates relative value information for exchange into global and alternative currencies. *
It is a most advantageous time to introduce Item Banc as world markets are seized up by a downturn in available credit and currencies are less stable. Item Banc technology manages and publishes information about product value and availability, in this way commoditizing products. This process allows information to be capitalized on so that nations and companies can continue to trade through difficult economic times. The technology uses this product commodity data as “backing” to a currency, in order to create currency valuation information, in other words, the relative value of one currency to another for the purpose of currency exchange. This technology, integrated with transaction exchange accounting systems within an international trade distribution organization, will be the foundation for initial trade “bridges” that can distribute basic human need products for fair market values of such around the world. As Item Banc is developed it will allow and empower people to trade their work for products that meet their basic human needs.
The inventories that define “needed goods”, or “Basic Human Need” (BHN) products include categories of food, building materials (as shelter), and basic clothing. In addition to the traditional BHN concepts we include paper products and necessary medical supplies.
Item Banc delivers a valuation to currency technology that produces commoditization of products by creating an average value for products and relative values across markets and publishing this information for the markets. The technology is designed to assist currency-challenged economies (for example, third-world economies where products are devalued because of currency exchange rates). Item Banc expands the concept of capital to include “information capital”, which is information about value and availability of products for trade transactions. Item Banc is structured to bring value information all the way to the consumer by enabling the commoditization of products that are basic human need (BHN) items. With this technology, together with trade distribution of BHN items, trade “bridges” are created that can deliver these BHN items to the consumer in trade for their work, with a goal toward strengthening economies and delivering dignity to people.
A trade product distribution organization supported by the Item Banc technology will use excess inventories as leverage (credit to spend derived from acquired inventory or services capital) to build the initial trade “bridges” into currency-challenged economies. The technology will not be fully functional without trade transaction “bridges” between economies using the same BHN products commoditized by the information engine. In order to support and supply these bridges, the organization operates an entire supply chain by manufacturing, distributing and selling BHN commodity inventories in wholesale and retail BHN stores which accept as tender cash and trade. The trade distribution organization delivers to consumers what they need in order to survive (BHN items) and issues credit for purchase of these items by leveraging excess inventories in markets for trade capital. In addition to consumer markets, the Item Banc publishes commodity data and integrates this information with transaction exchange systems for trade relevant to governments, industry, and corporations.
It is exciting to move forward technology like Item Banc that can enable the first “information currency”. We intend for this technology to bring to the world market efficiencies, business and labor security, and fair trade that were not possible even twenty years ago.
* proof of concept: The software structure for Item Banc has been beta-tested on three million dollars of live data out of forty-eight companies. The impact of the trade concepts in Item Banc have been tested for ten years in the US and international markets.
Detail on the theory and technology at http://www.informationcurrency.org
If you are an educator, contact the author for a free digital copy of the book at info@itembanc.com
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