At 03:25 PM 10/03/2001 -0700, Steve Schear wrote:
At 06:30 PM 10/3/2001 +0100, CDR Anonymizer wrote:
http://archives.nytimes.com/2001/10/03/international/03LAUN.html
lo-tech, trust-based, stable and fully functional since antiquity. I like it :-)
You'll notice the cost of money transfers using this private system are well below international bank wires. If governments want to reduce/eliminate this "illicit" competition they should fully underwrite the cost of international wires below a certain threshold (say $10,000).
This system accomplishes two main things - moving money securely, and working around government interference with money transfers, particularly India's restrictions on their non-convertible rupee. It's approximately the same system that the Italians ran so successfully during the Middle Ages - have offices in multiple cities in Italy and Spain, and there's enough traffic in different directions that the deposits and withdrawals in each city are mostly balanced, so the risky and expensive job of shipping gold and silver between cities only needs to be done on the net differences, not on the much larger gross, and depending on the level of trust between the different parties, you can float for quite a while and more easily absorb the occasional loss to pirates or shipwreck. This market's a bit more directional, perhaps, but it's dealing with cultures that have been doing lots of trading for millenia, and understand the value of repeat business, so it can adapt to the current needs, and adjusts prices to reflect the costs of moving the net transfers and the current risk value of trust.