An Algorithm for the Control of Inflation by Issue of Kardashev Money
Solar Energy Powered Inflation Control
Story inspired by dialog with Craig Schmitt
We’ve seen how money issued during covid lockdowns initially went up in value.
There is a school of thought that puts this down solely to MMT.
But we can see also the logic of how physically driven inflation has to result from domestic and community solar energy relentlessly and inevitably scaling upwards, at the expense of utility energy supply, which is scaling downwards accordingly. This is whilst the mathematically positive Joules from the sun are not officially monetised, since they are received for free, they can only be monetised by issue of free money, whereas money issued as debt can only represent extracted energy (mathematically negative)
For a numerical look at this, see the story below:
So the issue of money is coming to no longer represent actual product put to use, hence we see inflation of the money, since it is becoming increasingly representative of… nothing.
A common question, is what would determine the amounts and timing of money issued.
The answer is markets, the current mechanism used to control the prices of all things.
Strong money, that is money which has minimal inflation, is indicated by its value in markets. When its strength in markets is maximum, then inflation is minimal.
So we can use the market price as the indicator, our response being to manipulate the control factor which is the rate of money issue.
A simple diagram showing a working model of the algorithm, constructed using a structured scenario within the Use Case showin in the header of this article, which simulates in the UML toolset of Sparx Enterprise Architect (TM), is shown below:
The algorithm proceeds from our current economically deteriorating state in the red area, immediately to the state in the green area, of economy instantly stimulated, by issue of the first stimulus needed to pay back out the outstanding solar credit, as calculated using a technique similar to that shown in the UK “50bn Black Hole” story, linked earlier.
In time, we will see the market value of the issued money begin to decline, when solar product is again beginning to outstrip issue of money, thus taking the algorithm into the Inflation Moderate state in amber.
There, an updated calculation of the new solar credit outstanding gives the next issue of money needed to be issued immediately, putting the algorithm back into the Inflation minimised state.
The algorithm then repeats between the states in green and amber indefinitely.
We should expect the periods between successive issues to decrease, whilst the amounts issued sharply increase, due to a rapid scaling up of solar power which would be incentivised and fully funded, by the initial issues of money representing solar product. After the installation of the required capacity of solar energy backed by hydrogen necessary to power all things, the rate of increase will stabilise on an equilibrium, where frequency of installments and amounts issued should stabilise, enebling a steady state of switching alternately between the two states in green and amber.
That is all there is to it in the simplest sense; a three state algorithm with inputs from the market, and outputs to issue of money.
It would most simply be automated. In fact it is already, right here.
