The Next Economic Paradigm

Tag: sustainability

The Best Digital Currency

Nothing Economic happens until two or more people get together to make something useful.  This could be a house, a meal, a friendship, or an education. This has been true since the dawn of civilization and it is true more than ever today. Therefore, the best digital currency must facilitate and “account” for precisely this uniquely human activity – bringing people together in a useful way – not driving them apart. Everything else is a derivative.

The Best Digital Currency

Curiosumé is an analog to digital converter for knowledge assets. Curiosumé will rapidly scale and accelerate the matching and accounting for the best digital currency.  Everything else that would be needed already exists.  The working title of this currency is called Gen.  The asset that underwrites Gen is human productivity.

The difference between Gen and the dollar is that the dollar no longer represents human productivity.  Instead, it represents interest on debt, financial exotica, endless war, political influence, unsustainable consumption, etc.  These things are no longer useful to the majority of people.  As a result a lot of “economics” that should be happening, cannot happen. No current digital currency resolves that problem because they are all still derivatives of the dollar.

Gen is the digital currency of TIP (The Ingenesist Project).  Initially, Gen will act as the unit of account between technologists as they  trade Gen among themselves while collaborating on useful projects. For example, a mechanical designer would exchange Gen with a website developer to render a product to a community. Curiosumé resolves the dual coincidence restraint on traditional barter encounters.

As transactions become more complex, the Gen will begin to represent the generalized technological knowledge stored in infrastructure such as buildings, clean water, schools, and farms. Since these things are useful to a lot of people, those people would gladly accept Gen in exchange for their own useful non-technological services that they provide in a community.  In this way, everyone gets what they need using a currency that represents the utility of what they can produce together.

Economic incentives will be altered:

1. To produce useful things that people need.

2. To build high quality things that last a long time.

3. To preserve useful things for as long as possible,

4. To discard things and ideas that are not useful.

5. There is no incentive to cheat.

Don’t be fooled by crypto-hype, the best digital currency is between your ears and only you can hold the keys to that vault.

Curiosumé is an analog to digital converter for knowledge assets. The rest of the components can be found in technologies that already exist.  Let us know if you think that Curiosumé would be useful and we’ll build it together.

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Look Who Is Stockpiling Knowledge

Preppers were once considered among the more radical fringes of American Society, but now they are coming up with some of the more interesting ideas in sustainability.

Suppose that some financial calamity were to bring the economy to a standstill,  would  your education, intellect, wisdom, civility, and knowledge evaporate along with it?  Of course not, but that is exactly the danger that we face.

The inability to access, coordinate, and deploy our vast endowment of American knowledge assets may be the cause, not the effect, of that proverbial breakdown in social institutions for which the Preppers prep.  

Why wait?

While today’s Preppers are busy stockpiling survival gear, food, water, ammo, fuel, and even gas masks, the rest of us should be asking “where are we stockpiling community knowledge?”  Who will keep the water clean?  Who knows how to restore electricity or grow food? Who knows how to protect citizens?  Who knows how to remove a set a broken bone? Who knows how to teach children to read? Who knows how to fix stuff?

The Sequestration of Knowledge

The greatest danger to human survival may be the corporate sequestration of knowledge assets.  For example; corporations hold “knowledge” behind trade secrets, arcane job titles, and rigid processes where nobody from the outside can ever find or apply it.  Obviously, a company without knowledge cannot produce anything so understandably – whether we realize it or not – our most productive knowledge assets are locked up pretty tight behind the guilded walls of Wall Street.   This is not anyone’s fault – it is just the way we are organized.

It is time to evolve.

On the surface, a company that makes airplanes and a company that makes electric cars have very little in common.  An airplane company could never hire an engineer from a car company (and vice versa) because the job descriptions, production processes, and definitions of responsibility are cut from entirely different performance regimes.  Yet, as far as the engineer is concerned, the methods, systems and techniques for creating, say, graphite composite structures, are identical everywhere on Earth. If many industry could share engineers, not only would a great deal of diversity of new ideas be exposed, but cyclical layoffs could be avoided.

The Knowledge Commons:

What if a central knowledge inventory would represent all skills, talents, passions, and intentions of a community?  What if companies were to index their own skills ontology to a public knowledge commons instead of isolating their workers to the silos of internal processes?  Employees and companies would be more mobile and collaborative instead of secluded, protective, and competitive.

Social Equity Swaps

Suppose that a community could analyze their knowledge commons such that people could swap jobs so that everyone worked in the most qualified job that was also closest to their own home?  Billions of dollars worth of productivity could be preserved, billions of dollars worth of infrastructure could be preserved, and billions of units of energy could be saved.  Worker retention would rise and community unity would improve.

Free Market Enterprise

Suppose a company could read the knowledge commons of a community and produce the things that a community is naturally talented and interested in producing?  Quality would improve and costs would be reduced.  Innovation would increase and strong community collaboration will discourage competitors.

Everyone is an entrepreneur

Suppose that people (and companies) could locate to areas where there is a known deficit (or surplus) in their particular interest and passion? Risk and financial volatility would be reduced where people know that they will have a prosperous and interesting career / workforce.  Population density could decrease as people and companies locate to rural settings.  Countless billions will be saved on infrastructure as food and energy production can coexist with enterprise centers.

How to change everything without changing anything

These are just a few of the advantages of having a knowledge commons that is open sourced and readily accessible to markets instead of sequestered knowledge assets that force people to question their ability to survive in the future economic environment.  The next several blog posts will specify a possible system and structure for a public knowledge commons.

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The Future Of Money And Technology; Monetizing Intangible Capital

The following video series was recorded at the Future Of Money and Technology Summit in San Francisco on February 28, 2011. The name of this panel is Monetizing Intangible Capital. The speakers are Mary Adams (moderator), Art Brock, Greg Wendt, and myself. All six parts are posted below (8-10 minutes each) for public distribution, comments, and review.

I found this panel to be extremely interesting and especially valuable since these panelists represents an important cross section of professionals who are actually doing the hard work of designing, testing, developing, and producing specifications for the creation, storage, and exchange of what could represent a large percentage of the value in our global economy.  This discussion is not insignificant by any measure.

Mary Adams opened the panel with a remarkable statistic that 80% of our economy exists in the form of intangibles that do not necessarily show up in the balance sheet of the global economy – which is notably in crisis at this time.   Mary offers a working definition of Intangible Capital as consisting of 3 primary components: Intellectual Capital (the stuff between people’s ears), Relationship Capital (degrees of connectedness to a social network), and Structural Capital (tools, processes, and data).   Then, Mary adds a fourth category called Strategic Capital which includes planning, formulation, and scenario testing.

Mary then brilliantly guides the audience and the panel through 50+ minutes of high quality interaction addressing some of the most pressing issues of our time from the uprising in the Middle East, to Healthcare, Global Warming, Organic Food Production, and even the Internet Kill Switch – all these subjects become interconnected and relevant in this domain.

Art Brock introduces a set of very important ideas about how there is a vast amounts of “Value” that is not, and many never be, adequately articulated by a “monetary” system that exists today.  It is therefore necessary to capture value in a completely different manner involving higher forms of expression which, in turn, introduce a new “value system” that would better represents social priorities and the fair distribution of resources and associated wealth.

Greg Wendt introduces his work related to articulating the planet Earth as the “Meta Economy” under which the financial economy is merely a subset.  When accounted in this manner, humans are spending beyond our planet’s means to replace resources consumed.  As such, we cannot expect to arrive at a “Balanced Budget” by anyone’s definition unless we include a full accounting of Earth’s productivity.

I, myself (representing The Ingenesist project) suggest that there is a small flaw in market economics that can be corrected where the factors of production include a “knowledge inventory” rather that a material inventory of land, parts, and simple labor.  Such a knowledge inventory, if articulated in the correct format, can act as the basis of a social currency that may compete admirably with, if not fully replace, a vulnerable dollar based economy.

I was deeply impressed at how four highly recognized experts can approach a similar problem from four completely different directions and environments yet arrive at fully complementary set conclusions and subsequent solutions.  I encourage the viewer to watch the entire series as this is truly a rare meeting of minds.

Monetizing Intangible Capital Part 1/6

Monetizing Intangible Capital Part 2/6

Monetizing Intangible Capital Part 3/6

Monetizing Intangible Capital Part 4/6

Monetizing Intangible Capital Part 5/6

Monetizing Intangible Capital Part 6/6

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How Does Social Media Affect GDP?

Gross domestic product (GDP) is a basic measure of an economy’s economic performance.  GDP is the market value of all final goods and services made within the borders of a nation in a year measured in Dollars.  Globally, GDP is equal to the total monetary income generated by production of goods and services in a country.

Gross Domestic Product does not take into account many important variables accelerated by Social Media and growing exponentially in economic influence.

GDP counts only industrial output, but…

Industrial output is becoming increasingly dependent on social networks and social innovation.  GDP does not take into account such non-market transactions such as open source development, crowd sourced innovation, conversational currency, social capital, creative capital, or intellectual capital exchanged between people in diverse social networks

GDP reflects Wall Street Priorities, but…

Wall Street Priorities are increasingly challenged by social priorities. GDP does not account for sustainable business practices, heroism, mentorship, activism, volunteerism, social networking, uncompensated innovation, and community involvement.  GDP does not account for quality improvements and social multipliers such as aggregation of social media, increasingly powerful computers, acceleration of conversations, online etiquette, multi-media, and social editorial services.

All of the above exclusions are valuable, because…

These exclusions add value, they store value, they create value, they distribute value, and they exchange value.  If we called it a financial instrument that is highly convertible, extremely liquid, and easily transported it would describe a currency by any definition of the word.  For the purpose of this discussion, call this currency the “Rallod” – or Dollar spelled backwards.  The Rallod is the currency of the new American economic and production paradigm.

The Invisible Currency

For Example; Twitter is doing in Iran what America has been trying to do in Iraq for 8 years.  Face book, LinkedIn, and the entirety of social media space is producing many times the effectiveness of the $200 Billion U.S. advertising industry in terms of driving people to specific action. Social vetting platforms such as blogs, commentaries, groups, and content aggregation have increased the efficiency of markets by vastly reducing arbitrage opportunities while also identifying scams and corruption.  Human productivity is being converted to Rallods and there is no politician, executive, or white collar criminal anywhere in the world who is not deeply concerned about this invisible currency.

The Best is Yet to Come:

The “Last Mile of Social Media” is analogous to the last mile of broadband Internet – the marginal cost of reaching every person in every household and tightening social networks to extremely high resolution, is diminishing rapidly.   The Last Mile will bring communities together to vet local politicians, corporations, products, and policies.  The Last Mile will formulate a knowledge inventory combines with close proximity of knowledge assets and a percentile search engine to predict outcomes.  The Last Mile of Social Media will duplicate every function that exists in a corporation except it will be built upon the social media operating system; aggregated, amalgamated, sustainable, and reflecting social priorities.

So what happens to GDP?

GDP by current measure will reflect only the value of the “dollar”, not necessarily the value of the human productivity.  Perhaps it already does.

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The Ingenesist Project – press release

We have launched The Ingenesist Project. The Innovation Economy is an absolutely huge and necessary step forward for all of us. The current financial system is unstable and it will fail. At best, the innovation economy can increase human productivity sufficiently to support the debt load. At worst, there needs to be a system of trade in place for society in the event of a crash or devaluation so that people can purchase the necessities until the recovery can take hold. So yes, this is serious business.

Anyone following this blog please spread the word. I need to get people to the point where they will read the 18 articles – after which, hopefully, their outlook on the tangibility of knowledge in social networks will be permanently altered.

My challenge, of course, is to make a very difficult subject matter easy to explain and compelling enough to call people to action. Those 18 articles condense 400 years of financial industry development and history into a few pages. Yes, the analogy between social networks and finance holds well. This is not easy to explain, but the solution to the financial mess is right under our noses. It’s almost too simple to see.

The forum has been added to solicit threaded comments to the 18 articles. This is the backbone to the open source development. I hope to build future posts on the comments that arise – a feedback loop. We will identify the sub components, partners, strategies, and action items together. Participants will pay each other in a new currency.

I will soon simplify and interpret the preferred embodiments from the patent which will illuminate the countless new-to-this-world business opportunities that will become available to entrepreneurs in this environment.

As a demonstration; vetting mechanisms make markets more efficient. Ebay has the feedback score, Craigslist has the flagging feature – this is fact. Social networks are perfectly suited to act in this manner across the entire spectrum of commerce. This is a multi-billion dollar industry that can be very easily monetized in the innovation economy. I hope that others can see this too. There is a great deal of wealth to be generated for each other.

I would like to thank all of the people who advise this program. I soon hope to invite a Board of Directors and formalize the growing concern that is The Ingenesist Project. Anyone reding this, I am an open networker on Linked in – sent me a invite and I’ll respond.

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For immediate release:

The Ingenesist Project; Putting an End to Debt Economics

(Seattle) The Ingenesist Project is an open source economic development program that will challenge America’s financial meltdown head-on by creating an innovation economy trading rallods (dollar spelled backwards) backed by innovation instead of dollars that are backed by debt.

“Deficit spending is unsustainable. When the dollar crashes, People will need an alternate economy to trade in – one whose currency is backed by something tangible; and there is there is nothing more tangible than the human imagination, including gold”, says originator, Dan Robles. “Capitalism likes competition; well today, Social Networks are the ultimate competitor”

The Ingenesist Project has identified three relatively simple web applications which, when applied to Social Networks, will allow human intellect, social capital, and creativity to become tangible outside the construct of Wall Street and Corporations.

By definition, the rallod is pegged to the national debt, as such, The Ingenesist Project has 10 trillion rallods (and counting) to distribute. Participants in the Ingenesist Project Development Forum will award these rallods to each other on a reputation scale for their work in design, development, and improvement of the three web application that will release society from the shackles of debt economics.

The forum is open to anyone and participants can earn millions of rallods for their work in developing these applications.

The New ‘Stock’ Market

The Ingenesist Project has a patent pending for an Innovation Banking System to finance social innovation and will release all rights to the public domain.

“This is one of the most important patents applications published in our time. Countless ‘new-to-the-world’ business plans and patentable methods, systems, and devices will result from the The Ingenesist Project”, says Robles “Everything changes from the University System to the prioritization of global resources. Wall Street will be come the steward instead of the master”

Entrepreneurs are encouraged to patent, protect, or contain all intellectual property that they develop in the new economy and become as wealthy as they possibly can under the condition that they pay royalties, equity, or options to their knowledge inventory.

The entrepreneur’s “Secret-Sauce”, however, must be shared with The Ingenesist Project in order to improve the Percentile Search Engine Algorithm for the benefit of the public domain.

The Rallod

The U.S. National Debt is over 10 trillion dollars. Assuming deficit spending stops today, every man, woman, and child in the US is responsible for $33,500.00.

This means that $33,500.00 of every person’s productivity has already been spent. Obviously, the only way to pay the debt is to increase every person’s productivity by exactly $33,500.00.

The only sustainably way to increase human productivity is innovation. If the dollars crashes and pegs to the Rallod – the innovation economy will replace the debt economy and those who build it will become the bankers of tomorrow.

More Information:

Please review www.Ingenesist.com

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INGENESIST PROJECT: Submission to the 10^100

INGENESIST PROJECT: Submission to the 10^100 Innovation Contest; www.project10tothe100.com

Single sentence:
The Ingenesist Project is an open source economic development program to induce the Innovation Economy utilizing Social Networks.

Tell us more (300 words)
The current financial system has reached the limits of its effectiveness. Interest on debt has exceeded the system’s ability to pay it off. But debt is simply a promissory note on future productivity – any caveman can tell us that the only way to increase productivity today is to innovate yesterday, not tomorrow.

In modern times, this means that the only way to sustainably create more money tomorrow is to innovate today. This is the flaw on Wall Street that Innovation Economics will correct.

Ingenesist has specified three simple web applications when applied to Social Networks, will allow Knowledge to become tangible outside of the organizational construct of a corporation, government, or academia. To develop these applications would unleash substantial innovation and wealth in society.

*The Knowledge Inventory
*The Percentile Search engine
*The Innovation Bank

Knowledge is an excellent tangible asset upon which to peg a currency – better than Gold, Silver, or Debt.

The factors of production for an Innovation Economy are Social Capital, Creative Capital, and Intellectual Capital. The knowledge Inventory classifies knowledge assets in social networks. The Percentile Search Engine assembles unique knowledge asset combinations and returns their probability of executing a given business objective. The Innovation Bank matches most worthy knowledge surplus to most worthy knowledge deficit. Finally, entrepreneurs elevate knowledge assets from lower states to higher states of productivity thereby creating wealth in communities.

By analogy; in the early 1800’s Eli Whitney performed a demonstration for members of Congress by disassembling 10 working muskets, scrambling the pieces and reassembled 10 working muskets. It may seem trivial to us today, but that simple feat astonished the world; it led to the industrial revolution, and unlocked a vast amount of innovation and wealth creation. Innovation Economics is the modern day equivalent.
What Problem does it solve (150 words)?

Technological change must always precede economy growth. We are going about the process of globalization as if economic growth can precede technological change. This simple reversal is the cause for much of what is unsustainable in the world today. Innovation Economics corrects this flaw.

To make knowledge assets tangible is the Holy Grail of financial accounting. The Ingenesist Project asserts that knowledge assets are not intangible, they are simply invisible – this is a much easier problem to solve. Innovation economics solves this problem.

True valuation of knowledge assets allows for direct capitalization of people and their social, creative, and intellectual capital. Networks of knowledge assets form a new type of corporation that is fault tolerant, self regulating, risk diversified, and responsive to social priorities. Wall Street becomes the steward instead of the master. The whole game changes.

If it becomes a reality, what happens (150 words)?
If Innovation Economics becomes a reality, Social Networks will become the driving force of economic growth because human knowledge (as social capital, creative capital, and intellectual capital) can be capitalized directly. Creative knowledge workers would benefit most initially.

Eventually, publically traded Innovation Bonds backed by productivity gains will replace venture capital at vastly reduced risk and cost thereby unleashing an extraordinary amount of primary and tangential innovation creating a virtuous circle.

Areas of low productivity, such as poor communities and under-privileged populations will become targets for highest returns on innovation applications. Millions of new-to-the-world businesses will emerge and nearly all existing businesses will become more efficient where human knowledge is tangible and free to assemble itself in infinite, diverse, and strategic combinations.

If done correctly, eventually most people on Earth would benefit by freedom from the shackles of debt economics.

What are the initial steps to make it happen (150 words)?

Phase 1: The initial steps are: publish our research to a wider audience, prosecute our patent application (USPTO: 20070226361), release it to public property, and begin receiving public input.

Phase 2: Publish several animated videos which describe step-by-step the role that Social Networks must play to induce the Innovation Economy. Collect more input.

Phase 3: Create an open source development platform where ideas can be collected from the global community on how to develop the three web applications specified herein.

Phase 4: Develop and release common architecture web applications for The Knowledge Inventory, The Percentile Search Engine, and The Innovation Bank.

Phase 5: Exist indefinitely as an NGO to keep the game fair and build out emerging opportunities as needed.

What is the optimal Outcome and how is it measured (150 words)?
The intended outcome is for the innovation economy to arise from the knowledge economy as the next level of economic development. The optimal result would be an improved wider distribution of wealth and the transfer of corporate prioritization to communities regarding what gets innovated and what does not. Or likewise, which existing markets dynamics are disrupted and which are not. The optimal outcome would be the emergence of sustainable enterprise over forest-to-dump consumerism.

Metrics are inherent to the algorithm of the Percentile Search Engine as follows: innovation is proportional to the rate of change of knowledge with respect to time and knowledge is proportional to the rate of change of information with respect to time. Differential Calculus is the mathematical tool used to monitor all performance indicators of this system. In fact, all of the analytical methods of finance similarly apply to knowledge assets, by design.

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A Few Predictions for the Innovation Economy

Here are a A Few Predictions for the Innovation Economy

Social Network will become the corporate structure of the future. They will spit out start-ups at an astonishing rate.

The “resume system” will be banished forever possibly earning the title of the cruelest human invention since the lobotomy.

The University System will be challenged – the relevance of the college degree will be questioned in an economy that favors unique combination of knowledge assets rather than everyone having the same “degree”.

Everyone will have visibility of supply and demand for knowledge assets meaning that employers and employees will have equal information about cost, availability, and demand.

Creative knowledge workers will earn micro-royalties for their participation in thousands of brainstorming sessions and product development discussions. Earnings will be shared openly and the percentile Search Engine.

The new Patent will be the “Secret Sauces” – the algorithm that entrepreneurs will develop to select their knowledge assets when producing specific innovation.

Teachers will forego salary in favor of an equity position in their students. The best teachers will make the most money. Universities will forego tuition in favor of an equity position in students; the best students attract the best mentors and universities. Apprenticeship will become commonplace.

The knowledge inventory and Percentile Search Engine system rewards people for doing what they are most passionate about. The dominant strategy for all players in an Innovation Economy (that which produces the most revenue) is for participants to pursue what they are naturally good at and passionate for – as long as there is a market for it.

Innovation bonds will return 80% interest or more with near-zero risk. Institutional investors, insurance reserves, and foreign investors will flood the market with venture capital.

Knowledge workers will outsource management.

The Fed will peg the dollar to productivity, not gold or silver – interest on deposits will track productivity increases due to innovation.

Social priorities will impact what gets invented or what stays on the shelf; Global Warming, Alternative Energy, Sustainable environments will have net positive business cases.

The flaw in market economics will be reversed. Technological change will precede economic growth eliminating the economics of debt (ref video). The financial system will be restored to a sustainable condition.

We know that innovation is the engine of all wealth creation and it will live in an integrated system. Knowledge will be reformatted to emulate a financial instrument.

A good article from business week

A great Blog: Jay Deragon and the relationship economy

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The Capitalization of Knowledge – Innovation Bonds

With a computer readable knowledge inventory, local communities of practice, a percentile search engine algorithm, and the virtuous circle of finance, then future innovation cash flows can be predicted much more accurately and with far lower risk than with, say, the venture capitalists acting alone.

Were risk is predictable, cash flows are predictable and the portfolio of innovations can be diversified so if one business fails there is an equal chance that another will succeed and the risks cancel each other out. The cash flow of all the innovation enterprises can be combined into a single large steady cash flow. Just like companies do to raise money for expansion, the innovation bank can issue innovation bonds on the open market. The revenue from selling Innovation Bonds can return to the community to finance innovation and fund wealth creation at very low interest rates compared with venture capital today.

With a lower cost of venture capital and a system that supports open source innovation an astonishing amount of innovation will be unleashed in society.

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The Capitalization of Knowledge – The Virtuous Circle

We have set up a new game for entrepreneurs to play called Innovation Economics. We have defined a currency and an inventory where knowledge is visible outside the construct of the corporation – and resident in social networks. We have also described a way for entrepreneurs to visualize the knowledge asset and the supply and the demand for knowledge assets. We have given them a tool for matching assets for profit. We have described how social networks will keep the game fair. We have outlined the structure of new business plans; the brain storming session, product development cycle, the neural network, and the multiplier effect. Future businesses will be built upon combination of these four structures and whatever else entrepreneurs can dream up.

We have described all of the pieces needed to form a new economy. Now we need to connect with the financial markets so that knowledge is readily convertible to other currencies.

For review;

With the financial bank, the entrepreneur assumes that they have the knowledge to execute a business plan and then they look for the money. The risk is that the entrepreneur does not in fact have enough knowledge.

With the Innovation Bank, we assume that we have the money, and we go to the bank to search for the knowledge. The risk is not having enough money to purchase sufficient expertise.

With both banks acting together – the risks cancel each other out and the innovation economy tends toward a ‘risk free’ cycle; the more knowledge you can assemble, the more money you can borrow. The more money you can assemble, the more knowledge you can assemble.

Now we have a virtuous circle. The more knowledge you have, the more money you can borrow; and the more money you have, the more knowledge you can borrow.

There is no shortage of money circling the globe – only a shortage of risk free places to put the money. The innovation economy is an environment of very high return for a very low risk and will attract a great deal of money to fund innovation enterprise.

Earlier we demonstrated that money represents human productivity. It follows that the places that have the greatest potential for increasing human productivity can create the greatest amount of wealth. Therefore, poor areas and marginalized economies with under utilized knowledge inventories or the injection of specific knowledge inventories, become the highest ROI centers in a risk-free system; a condition the explicitly favors the wealth equalization rather than wealth disparity.

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