The Secret Justice Bill = The Ring of Gyges

RE: The Secret Justice Bill = The Ring of Gyges

The Secret Justice bill is insane.

It could technically lead to an inability of a person to find out why he/she is  barred for life from the United States, that there is some secret information about some secret offence he/she is secretly alleged to have committed against the National Security of the United States of America.

The Justice Secretary, Kenneth Clarke must be petitioned to ask him if there are safeguards on revealing information to such UK citizens on outstanding secret warrants pertaining to that British citizen who have not been charged with any crime in the UK or elsewhere.

I fear that our human rights will be breached as a result of this policy, only to spare the blushes of some corrupt (or if I wish to be generous - incompetent) Police and security officers who are simply using the new Secret Justice bill to disguise the very corruption that normal legal processes would expose.

This "Secret Justice" bill is an affront to any society based on the Rule of Law. It permits the very kinds of abuses that the UK Government condemns in totalitarian regimes.

It is a carte-blanche for the very worst instincts of the power-intoxicated to flourish in the new formed darkness away from the disinfectant of scrutiny and consequences.

Plato's allegory / thought-experiment "The Ring of Gyges" adequately sums up what happens when one person or a group of people can escape scrutiny from their actions. It only takes months before abuses begin. Gyges of Lydia used his new found power (invisibility) to slay the king and take his wife and kingdom. The Lord of the Rings is a more modern retelling in part as is "The Invisible Man".

Eric Masaba

The Ring of Gyges - Denouement

"So it was ********* the whole time?" asked Arsif.

"Yes - it was either him who set me up up originally 16 years ago or at least prolonged my agony"

"But how do you know this?" asked the Mozambiquean.

"It took me a very long time, but by now you know what my memory is like, so I was able to put together a lot of threads and eliminate all the other possibilities to arrive at this conclusion".

"Celtic City was a real cesspit from the 1950s right through to the early 2000s. There was no work, rampant crime, whole generations of people who had never worked. To be black here was to be guilty. Who would ever really believe that a young black man from here could have become educated enough to solve an optimisation problem thought of as impossible by all the top minds at MIT and Caltech.

What happened was really simple. A suspicious Police officer found me driving to and from France in the mid 90s and assumed I was a drug courier or somehow involved with illegal activities. The Police would have gone to my Professors at the Department of Aeronautics, some of whom really hated me and wanted to see me brought down. The fact that I always had a good reason for the trip - e.g. holidays, meant nothing. Then I got a job at an investment bank and bought a BMW the next year, so that must be proof. Never underestimate envy - especially racial envy - when it comes to Police investigations.

When they could not find anything, the investigating officer was beginning to look like an idiot, so he or she urgently needed something else to turn up. Something did turn up: "Islamic Terrorism". In the Department of Aeronautics at Empirical Sciences University. Now all they needed to do was to link me with that somehow and the problem would be solved. Better still, they could flush all their other drug money through an account in either my name or an alias which they could say was me. Once I would be arrested by the Counter Terror Police (and disappeared into the Justice System Black Hole), they would then find an apparently broke black guy sitting on an account with millions of pounds in it - `in order to fund terrorist activities`. They would of course report only a small fraction of the `find` and keep the rest - killing five birds with one stone.

One. Strengthening the narrative of the highly educated, radicalised black Islamic terrorist at a UK University. To get people past the "but he's not the type" argument.

Two. Linking drug money / human trafficking with Islamic Terrorists.

Three. Linking Taxi firms and foreign exchange (FX) trading money laundering activities with those same Islamic Terrorists.

Four. Covering up a botched operation targeting the wrong guy for over 5 years that had cost millions and had correspondingly diverted resources from better lines of enquiry. Which meant that the people in charge were incompetent.

Five. Stealing someone else's invention and intellectual property so the thievery corporation could pass it on to their members.

Hell, you'll find that the very same idiot cop probably got promoted by telling larger and large lies and embroiling more and more people such as those who could not find enough terrorism conspiracies to bust open to justify their terrorism budgets. The reason they couldn't find many was that most of Islamic Terrorism was a constructed myth - prefabricated to put into place a security apparatus for an impending war.

And to make things easier, just spread the word amongst my so-called friends that I was involved in crime (hence my success) and Hey Presto - a legion of informants who want to see me brought down. Envy - another of the Seven Deadly Sins and perhaps the second most insidious. What this did, though was show me who my true friends were - something very few people ever get to see while alive.

"So this is why that David Wrong guy became so hostile and started telling people that you were bad news?" asked Arsif, looking angry.

"Yes. But then they had people in the State Department Foreign Service ringing my phone from Al Qaeda satellite phones - to set up a trail of breadcrumbs that the honest CT people would follow. It was all calculated to frame me"

Now to make things stick, you have got to have several other investigations corroborate these "suspicions", so I was on the look out for arrests of people with identical or similar enough profiles to my own.

And there was that black guy, a pilot who was involved with foreign exchange (FX) trading activities shot dead in the same area of Liverpool where I live and grew up. And he appeared to be highly successful and middle class. ( http://www.bbc.co.uk/news/uk-england-merseyside-20560534 ) 

Then there was that Nigerian student from UCL whose father was a big muckety muck in the Government who was allegedly radicalised before trying to blow up an aircraft. This then shows that even a well educated, wealthy young elite engineering student with an impeccable family background could be a terrorist. Unfortunately, elements within the CIA smelled a rat and blew the operation by mentioning the presence of RAW (Indian intelligence service) agents helping this guy evade all the checks that would have caught him and board the flight. ( http://elombah.com/index.php/special-reports/55-news/sports-news/4184-nigerian-pants-bomber-abdulmutallab-not-radicalised-at-london-uni-report-v15-4184 ) 

Then there was the taxi firm which was laundering drug money through an FX firm that was busted after a long investigation. Problem was, it was being run by that hero Ambulance man from the 7/7 bombings. Which meant - protected black op. ( http://www.guardian.co.uk/world/2011/jan/05/police-smash-london-drug-gangster-syndicate  ) 

And then you need a cutout who matches the description of the mark (me). So there was another person who fit my description (slim, young black man) who kept turning up in places I had been to. Like the Natwest Bank in Berkeley Square where I used to go to deposit money from a contract job.  When a cashier from that bank turned up in a shopping centre in Southampton in 2009, while I was visiting Van Buren, I knew that something must be up and that someone appropriating my identity was still operating. This guy was brought in to identify me.

Same thing with the person arrested in Uganda with a similar or identical name to me. He was kept there in prison so that the relevant people could determine that he was not me. This could only have been sanctioned at the very highest level within the UK intelligence community. No less than the head of service had gone rogue.

Thus, I needed to keep on making noise, keep on being helpful to other services to bust this wide open. So they then tried to use the "he actually works for us" and try to bring me in to their conspiracy by threats and promises.

Of course, how can you trust people who have been trying to bury you for the previous decade? Why would they suddenly start respecting you? It would be suicide to work with them.

So I resolved to look for a huge money laundering operation that needed new sales or apparent new successes to hide the flows. The property market had stalled so this usual conduit was closed off. And then, there was the fact that I kept talking about CDOs being a Ponzi scheme - which would have enraged these very same people. Like someone who has stolen from the Mafia, you are safe as long as the crime is never found out. Or a Ponzi scheme that can operate for decades undetected so long as it always makes its returns.

Fractional Reserve Banking, War and Keynesian Economics - which go hand in hand - are the biggest Ponzi schemes there are. As you know, I am opposed to all of them.

"But why go to all that trouble? Surely it would be cheaper just to pay you for what you had created" said Arsif.

"Racism. Pride. And Spite. - Someone, most likely a female or someone with a female personality, really wanted to harm me for some reason. Beyond all reason or sense. There is a reason Pride is considered the most deadly of the Seven Deadly Sins. A person suffering from an excess of Pride cannot  - will not - think straight. Will not compromise. Is arrogant, haughty, conceited and spiteful and will not respond to new data in a rational way.That is the most dangerous type of person to be given great power."

There is no time like the present - end "Too Big To Fail" this week.

If the Government does not take action now, nothing will ever be done. Action is required immediately. Not next week, nor next year, nor after the next election.

Right now is the time to cease all state support to all the banks.

We are constantly being told how talented and important these banks are. How the economy depends on them and their ultra-talented staff who will go elsewhere. A simple question - so why are they welfare recipients? Why are they so unable to fend for themselves that they need the protection of the apparatus of the State to help them continue?

If their employees are so capable, so clever, then this is one state-supported industry that could wound up tomorrow morning and each of the 500,000 or so highly remunerated staffers would be in even better paid positions by lunchtime.

Don't delay - break up the big banks today.

A way out of the Eurozone Crisis | A return to sound money

Bring back full reserve banking, liberate the payments system, bring back the gold standard (at the same time as allowing people choice of currencies) and we will see savings channelled into investment in the fastest time possible by the most advanced analogue computer known to man - the free market.

Consider the following - What would happen if every human being in the EuroZone had a banking licence?

QUOTE: "Nobody has any idea of what a new invention will really be good for. The crucial question is, what happens when everyone has one?“ - Kevin Kelly[2] - Co-Founder of WIRED magazine

It is odd, but while completing some analyses for my ridesharing project, I came across a couple of very interesting presentations and also an NYTimes article on techno-literacy.

These seem to address the problems with both the EuroZone crisis and the design of a banking system

Consider these technologies - Lighting, Writing, Telegraphs, Telephony, Faxes, Computers, Email, Cars, Air Travel, Hotels and Publishing.

At one stage, they were of limited spread and limited use. Only a few (usually socially elite) people had access to the technology in its infancy. Yet the overall utility of the technology vastly increased when more people got hold of it: network effects.

The control over populations enjoyed by elites and tyrants was broken (think of what the printing press did for freedom, when combined with wider literacy).

Consider LITERACY EDUCATION - which basically allowed *anyone* to become a scribe / (wo)man of letters.
Consider EMAIL - which basically allowed *anyone* to become a post office.
Consider BLOGS - which basically allowed *anyone* to become a publisher.
Consider TWITTER - which basically allowed *anyone* to become a newspaper wire Service
Consider AIRBnB -  which basically allows *anyone* to become a Hotel
Consider OPEN UINVERSITY / ONLINE EDUCATION - which basically allowed *anyone* to become a "graduate" (or would if there weren't rules on "needing a degree" for certain jobs)

Consider also what would happen when we completely deregulate transport - which basically would allow *anyone* to be a transport service - thus competing with incumbent monopolies.

The time has come to wonder - what would happen if every human being in the EuroZone had a banking licence? That anyone (using the banking cloud) could act as a source of funds or as a depository of value offering a competitive return on funds in a fully liquid fungible market.

This would, in a stroke, disrupt the banking system and change the behaviour of the very banks who enjoy monopoly protections from the State while delivering a poor service.

Consider a gold backed National banking cloud. People could move move their pension into Gold and Silver and be sure that they were protected against inflation. Better still, any nations using the Gold Standard would enjoy full connectivity between these populations, free from the inflatory machinations of demagogues.

There would not necessarily be a "hoarding problem", since people could stipulate e.g. 20% of saved funds to be used in lending projects.

(Yes - I know that Money Market Funds are supposed to offer the following - but please humour me)

Just consider this for a few minutes and we may have a way out of the global malaise. It requires a complete destruction and dismemberment of the old ways of doing things (and banks, VC funds and pension funds will all have to evolve), but it could just be what is needed.

The first step is to remove all State protections and privileges for broadband companies and to allow ANYONE to connect to the payments system of a nation without any need for credit checks. The rest will follow in a matter of months.

We are seeing this already with VentureGiant, Seedrs, Crowdcube, FundingCircle and ZOPA, but the problems that remain are the artificial bottlenecks created by ratings agencies.

Bring back full reserve banking, liberate the payments system, bring back the gold standard (at the same time as allowing people choice of currencies) and we will see savings channelled into investment in the fastest time possible by the most advanced analogue computer known to man - the free market.

SOURCES:
1. Yiibu Design | "Adaptation" presentation
http://www.slideshare.net/yiibu/adaptation-why-responsive-design-actually-begins-on-the-server
2. NYTimes Magazine, Sep 2010 | THE WAY WE LIVE NOW Achieving Techno-Literacy
http://www.nytimes.com/2010/09/19/magazine/19FOB-WWLN-Kelly-t.html?_r=1

Why the banking reforms must be implemented post-haste and any special pleading from the representatives of the banking sector must be ignored.

"The whole argument of this book may be summed up in the statement that in studying the effects of any given economic proposal we must trace not merely the immediate results but the results in the long run, not merely the primary consequences but the secondary consequences, and not merely the effects on some special group but the effects on everyone. It follows that it is foolish and misleading to concentrate our attention merely on some special point-to examine, for example, merely what happens in one industry without considering what happens in all. But it is precisely from the persistent and lazy habit of thinking only of some particular industry or process in isolation that the major fallacies of economics stem. These fallacies pervade not merely the arguments of the hired spokesmen of special interests, but the arguments even of some economists who pass as profound." - Economics in One Lesson, by Henry Hazlitt

British Bankers' Association chief executive Angela Knight said banks should be allowed to "finance the recovery first, pay back the taxpayer next", and only then set about reform.

"If more regulation remains at the top of the list, then this will only have the affect of risking the recovery which is so essential to our future," she said.
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Phooey! Baloney! Tripe! Poppycock!


If we had simply let the banks go bust, the UK economy would have been a much better place. The current banks and the current rules (which gives these parasitic dinosaurs implicit guarantees) ARE the problem, plain and simple.


People like Angela Knight need to be ignored more often.


Contrast banking to free email accounts. There are no laws restricting entrants to the provision of email services or requiring people to fill out copious forms to get an email account.


Was there ever a "provide email to the masses act"? No - because Yahoo, Google, Hotmail all stepped up and delivered on their own accord.


The same will happen for banking once the shackles on the Free Market have been removed,


Only recently has the wonderful APS Prepaod Mastercard appeared and is now changing the game finally. No credit check, no paperwork, All done online and ready to use within 2-3 days.


Let the current crop of banks die. They are a plague on all our houses.


And while we are at it, we must also look at removing rules that favour debt over equity, that give the asset class real-estate special preference in lending multiples rules and that require pension funds to buy and hold Government bonds. 


Dramatic and far reaching, yes - but these proposals must be considered. 


Investment decisions and capital allocation have been distorted to feed the monster that the State has become. Without such rules, the State would have very little money to waste. Any money the State did have it would spend more wisely.


http://www.fee.org/library/books/economics-in-one-lesson/#0.1_L15

Chapter Fourteen
SAVING THE X INDUSTRY
The lobbies of Congress are crowded with representatives of the X industry. The X industry is sick. The X industry is dying. It must be saved. It can be saved only by a tariff, by higher prices, or by a subsidy. If it is allowed to die, workers will be thrown on the streets. Their landlords, grocers, butchers, clothing stores and local motion picture theaters will lose business, and depression will spread in ever-widening circles. But if the X industry, by prompt action of Congress, is saved-ah then! it will buy equipment from other industries; more men will be employed; they will give more business to the butchers, bakers and neon-light makers, and then it is prosperity that will spread in ever-widening circles.
It is obvious that this is merely a generalized form of the case we have just been considering. There the X industry was agriculture. But there are an endless number of X industries. Two of the most notable examples in recent years have been the coal and silver industries. To "save silver" Congress did immense harm. One of the arguments for the rescue plan was that it would help "the East." One of its actual results was to cause deflation in China , which had been on a silver basis, and to force China off that basis. The United States Treasury was compelled to acquire, at ridiculous prices far above the market level, hoards of unnecessary silver, and to store it in vaults. The essential political aims of the "silver Senators" could have been as well achieved, at a fraction of the harm and cost, by the payment of a frank subsidy to the mine owners or to their workers; but Congress and the country would never have approved a naked steal of this sort unaccompanied by the ideological flim flam regarding "silver's essential role in the national currency."
To save the coal industry Congress passed the Guffey Act, under which the owners of coal mines were not only permitted, but compelled, to conspire together not to sell below certain minimum prices fixed by the government. Though Congress had started out to fix "the" price of coal, the government soon found itself (because of different sizes, thousands of mines, and shipments to thousands of different destinations by rail, truck, ship and barge) fixing 350,000 separate prices for coal.* One effect of this attempt to keep coal prices above the competitive market level was to accelerate the tendency toward the substitution by consumers of other sources of power or heat-such as oil, natural gas and hydroelectric energy.
2
But our aim here is not to trace all the results that followed historically from efforts to save particular industries, but to trace a few of the chief results that must necessarily follow from efforts to save an industry.
It may be argued that a given industry must be created or preserved for military reasons. It may be argued that a given industry is being ruined by taxes or wage rates disproportionate to those of other industries; or that, if a public utility, it is being forced to operate at rates or charges to the public that do not permit an adequate profit margin. Such arguments may or may not be justified in a particular case. We are not concerned with them here. We are concerned only with a single argument for saving the X industry-that if it is allowed to shrink in size or perish through the forces of free competition (always, by spokesmen for the industry, designated in such cases as a laissez-faire, anarchic, cutthroat, dog-eat-dog, law-of-the-jungle competition) it will pull down the general economy with it, and that if it is artificially kept alive it will help everybody else.
What we are talking about here is nothing else hut a generalized case of the argument put forward for "parity" prices for farm products or for tariff protection for any number of X industries. The argument against artificially higher prices applies, of course, not only to farm products but to any other product, just as the reasons we have found for opposing tariff protection for one industry apply to any other.
But there are always any number of schemes for saving X industries. There are two main types of such proposals in addition to those we have already considered, and we shall take a brief glance at them. One is to contend that the X industry is already "overcrowded," and to try to prevent other firms or workers from getting into it. The other is to argue that the X industry needs to be supported by a direct subsidy from the government.
Now if the X industry is really overcrowded as compared with other industries it will not need any coercive legislation to keep out new capital or new workers. New capital does not rush into industries that are obviously dying. Investors do not eagerly seek the industries that present the highest risks of loss combined with the lowest returns. Nor do workers, when they have any better alternative, go into industries where the wages are lowest and the prospects for steady employment least promising.
If new capital and new labor are forcibly kept out of the X industry, however, either by monopolies, cartels, union policy or legislation, it deprives this capital and labor of liberty of choice. It forces investors to place their money where the returns seem less promising to them than in the X industry. It forces workers into industries with even lower wages and prospects than they could find in the allegedly sick X industry. It means, in short, that both capital and labor are less efficiently employed than they would he if they were permitted to make their own free choices. It means, therefore, a lowering of production which must reflect itself in a lower average living standard.
That lower living standard will be brought about either by lower average money wages than would otherwise prevail or by higher average living costs, or by a combination of both. (The exact result would depend upon accompanying monetary policy.) By these restrictive policies wages and capital returns might indeed be kept higher than otherwise within the X industry itself; but wages and capital returns in other industries would be forced down lower than otherwise. The X industry would benefit only at the expense of the A, B and C industries.
3
Similar results would follow any attempt to save the X industry by a direct subsidy out of the public till. This would be nothing more than a transfer of wealth or income to the X industry. The taxpayers would lose precisely as much as the people in the X industry gained. The great advantage of a subsidy, indeed, from the stand point of the public, is that it makes this fact so clear. There is far less opportunity for the intellectual obfuscation that accompanies arguments for tariffs, minimum price fixing or monopolistic exclusion.
It is obvious in the case of a subsidy that the taxpayers must lose precisely as much as the X industry gains. It should be equally clear that, as a consequence, other industries must lose what the X industry gains. They must pay part of the taxes that are used to support the X industry. And consumers, because they are taxed to support the X industry, will have that much less income left with which to buy other things. The result must be that other industries on the average must be smaller than otherwise in order that the X industry may be larger.
But the result of this subsidy is not merely that there has been a transfer of wealth or income, or that other industries have shrunk in the aggregate as much as the X industry has expanded. The result is also (and this is where the net loss comes in to the nation considered as a unit) that capital and labor are driven out of industries in which they are more efficiently employed to be diverted to an industry in which they are less efficiently employed. Less wealth is created. The average standard of living is lowered compared with what it would have been.
4
These results are virtually inherent, in fact, in the very arguments put forward to subsidize the X industry. The X industry is shrinking or dying by the contention of its friends. Why, it may be asked, should it be kept alive by artificial respiration? The idea that an expanding economy implies that all industries must be simultaneously expanding is a profound error. In order that new industries may grow fast enough it is necessary that some old industries should be allowed to shrink or die. They must do this in order to release the necessary capital and labor for the new industries. If we had tried to keep the horse-and-buggy trade artificially alive we should have slowed down the growth of the automobile industry and all the trades dependent on it. We should have lowered the production of wealth and retarded economic and scientific progress.
We do the same thing, however, when we try to prevent any industry from dying in order to protect the labor already trained or the capital already invested in it. Paradoxical as it may seem to some, it is just as necessary to the health of a dynamic economy that dying industries be allowed to die as that growing industries be allowed to grow. The first process is essential to the second. It is as foolish to try to preserve obsolescent industries as to try to preserve obsolescent methods of production: this is often, in fact, merely two ways of describing the same thing. Improved methods of production must constantly supplant obsolete methods, if both old needs and new wants are to be filled by better commodities and better means.

Conclusion
Let the banks go. Let them all die. New ones will spring up. They should have never been bailed out in the first place. To carry on bailing them out is an even bigger nonsense. That money is a sunk cost. It is gone. Do not throw any more money after it. Let these monstrosities meet their fate.



Eric Masaba

The Demand Responsive Transit Exchange

LARGESCALE VEHICLE SHARING

Vehicle sharing is a service that provides members with 24-hour access to a fleet of cars on-demand at an hourly rate that includes gas, insurance, and maintenance.  Taxi-sharing helps reposition the automobile as one transportation choice among several rather than the sole, default choice.

Combining SMS + Social Networking, taxi-sharing can start to change lives for the better almost immediately.

Commonsense suggests that taking a taxi eliminates the worries of parking, theft and getting lost. One could indulge in alcoholic beverages in bars and restaurants and still get home with one's driving licence intact.

It could be concluded that largescale taxishare programs help to reduce congestion, increase transit use, reduce emissions, and lower the overall costs of transportation, while offering more choices in work opportunities to the lowest income citizens in any locale.

This can only be achieved in a fully deregulated taxi market (or equivalent like town car or limousine) and with access to advanced booking systems such as a DRT Exchange.

If a company like Hertz could deliver rental cars to the front door of customers (because the delivery drivers could get a shared taxi ride back to a prescribed meeting point) then we may see more households using carclubs / carshare schemes.

Also, if the carclub companies could reposition cars around the city, to increase the likelihood of uptake at certain areas and times, this would perhaps encourage more use.

At Crane Dragon, we see a DRT Exchange as a means to book a whole vehicle (or just one seat), with or without a driver.

We also see it as a way to organise booking of motorcycle couriers or even bicycles. People could ride a bicycle to work and if too tired to ride back, could opt to take a shared taxi ride, thus alerting the bikeshare scheme to pick up the bicycle in a van and take it to another location, if market demand so dictates.

--
Eric M.W. Masaba
Founder, CEO, Texxi
http://vator.co/texxi

Abstract
A Demand Responsive Transit Exchange (DRTE) will allow people to effectively access (shared) transportation resources more readily than currently occurs. It is based on the idea of a futures exchange where an intermediary (the exchange) allows buyers (prospective passengers) and sellers (vehicle operators) to trade in a transparent market. By using various exchange mechanisms (e.g. market-making, liquidity provision, margining), prospective passengers can obtain point-to-point transport (shared or private) from vehicle service operations for a known cost for a series of trips.
The Exchange promises to mitigate the "market formation problem" for ridesharing - by acting as an intermediary ready to trade with buyers or sellers until the market is fully formed. Just how long the Market Makers on the Exchange have to make a loss will be a function of the marketing and deployment tactics of the exchange.

Participants on the DRT Exchange
Vanpools (commercial)
Carpools (commercial or private)
Rental Cars / CarClubs / Carsharing schemes
PRT Systems (automated taxis)
Buses, Coaches, Soccerbuses, Tourbuses
Private Jets / Charter Aircraft
Charter Trains

Synopsis
The growth of car transport in cities around the world threatens to destroy the very livability of those cities as congestion increases if the number of cars continues to grow in line with the human population.

Thus a means of encouraging people to share transit resources has become ever more pressing. To provide a viable replacement to the private car, shared transport resources must be available to users on a per need basis rather than being scheduled.

One way to achieve this is a "dynamic trip registry" for individuals which resembles a (financial or commodity) Futures Exchange.

This is the core concept behind Texxi - The Transit Exchange for the XXIst Century: the first implementation of a "Demand Responsive Transit Exchange" (DRTE) literally a futures exchange for transit. The exchange itself will have brokers, market makers, margining requirements and credit limits.

Prospective customers will register their intentions to travel on the exchange and where acceptable convert the "intention to travel" into a "right to travel" (purchase a ride in the future - anywhere between 5 minutes up to 12 months ahead).

The marketplace represented by the cumulative intentions can be subsequently used for optimisation of vehicle resources in line with customer price and travel preferences. The dataset itself can be further analysed (data-mined) to provide more information essential to transport planning considerations. The full range of well understood instruments currently used in equity and foreign exchange markets can be applied to the instruments in the Demand Responsive Transit Exchange.

Such operations as instrument swaps, market-making, insurance and liquidity provision can now be undertaken. As an innovation for intra-city transport, we expect to see the DRTE collapse prices significantly while increasing demand by increasing vehicle load factors.

Finally, as perhaps as important as the reduction in congestion, the reduction in price for users is the information on future demand and subsequently route management that a DRTE will provide a local, regional or national government.

Contents
Prologue
1.        Introduction
2.        History of Commodity Markets
        Capital Market concepts
        Commodity and Agricultural Exchanges
         Electricity and Gas Markets
        Futures
        Forwards
        Options
        Swaps
        Insurance
3.        Database of Transit Intentions
        Search Application
        Zeitgeist
4.        Ratings System
5.        Deployment Guide

Appendix
Table of Figures
References
Prologue
The Texxi system evolved from a series of research projects over a 12 year period, beginning with a one year placement at the Technology and Science Laboratories of the National Grid Company in Leatherhead, Surrey, UK and culminating in a one year project at a Connecticut based hedge fund studying capital structure arbitrage and convertible bond trading.
The seed of the idea of a "market for tradeable transit / transport" was first introduced to me at National Grid where I was informed of the "Pool" - a tradeable market in which the generators of electricity and the wholesale distributors interacted.
The inventors of these concepts hail back to the storied Chicago school of Economics. They were Chilean economists who were students of Milton Friedman and were known vernacularly as the "Chicago Boys" who did a lot of pioneering work in the application of free markets to electricity and other energy utilities.
Professor Stephen Littlechild used many of their concepts to bring deregulation and privatisation into UK energy markets. The leaders of this field were in Uruguay and Argentina.
The first project was an electricity supply project where demand for electrical power was managed using a database of meteorological conditions in order to increase the throughput of the electricity transmission system, while complying with the constraint that the temperature of the power lines remained within prescribed statistical risk parameters. (One could rightly consider this as a type of statistical arbitrage).
Inclement weather conditions (when it is windy, cold, wet and dark) provide greater physical cooling on power lines by environmental effects than at times of bright sunshine, still air and high ambient temperatures. Thus more electrical power can be transmitted along a set of power lines for the same overall increase in line temperature - which is the limiting factor for electrical load on power lines - if one can be somewhat sure about the meteorological conditions up to a day ahead.
There is a stochastic set of principles regarding the temperature excursions a line can undergo and still be regarded as "safe". Careful use of each of prediction data, actual ambient condition data, coupled with a good grasp of the dynamic demand conditions allows better use of the the existing transmission infrastructure and thus reduces the amount of generating capacity needed to supply a certain number of customers, since there is less wastage.
This optimisation, coupled with markets which can be used to statistically estimate ("predict") future demand, has the overall effect of increasing the effective throughput of the electricity transmission system through enhanced risk management. In short, it is an example of a hybrid "demand responsive" and "ambient conditions responsive" system.
Texxi, uses a "database of transit intentions" (cf. Chris Anderson's "Database of Intentions" for search), a DRT Exchange and social networking algorithms to do the same thing for "road-spacetime". The key approach was to use the same ideas behind credit default contagion to reduce the search space and optimise the load factors in order to minimise the journey paths of as many vehicles as possible, while preserving, wherever possible, customer preferences. (Credit Contagion refers to the observed phenomenon of companies that default on their obligations actually having social links and social consequences).
The biggest challenge in largescale ridesharing systems has been priming the customer demand and maintaining a high enough level of interest to maintain a critical mass for an effective market to form. To this end, we discovered that the reliability of transaction partner was more important than almost anything else and thus the concept of a "market maker" was critical to the whole endeavour. On an exchange this is known as "assuredness of completion".
The second fundamental project was a travel bursary to examine the "Role of Computers in Transportation Technology" in the United States of America in 1995. On this trip I was able to look at developments in automated highways, a subway being built in Los Angeles by  CALTRANS, two NASA bases and the Association for Computing Machinery's Special Interest Group on Computer Graphics (ACM SIGGRAPH 95) in Los Angeles. This was funded by the Royal Academy of Engineering and the Royal Aeronautical Society. I undertook this while in my 2nd year of Aeronautical Engineering at Imperial College.
All through the endeavours was ongoing familiarisation with groupware software development environments and functional language ideas, which are all about manipulating lists of data by the use of functions. This approach is actually superior in some regards to the normal structured query language of most well used relational databases. In fact when it comes to looking at large datasets, products such as MatLab and XenoMorph take the functional approach.
A project undertaken at Ecole Centrale De Lyon in 1996-1997 provided the testing ground for the use of a real groupware database system to enable campus ridesharing for students. User uptake for the system was low, mainly since in 1997, most people did not own a mobile phone, did not use SMS and were required to pre-register their trip some time in advance. This reduced the already low number of available data for grouping and reduced the likelihood of finding matches. Thus for when I was to revisit this problem 7 years later, I had new ideas for how to generate the relevant traction and it was to be based upon demographic pre-analysis of an area which would inform the marketing decisions, strategies and tactics.
A project undertaken for a US based Hedge fund specialising in capital structure arbitrage. I had built a system which consumed data from a variety of different feeds (flat file databases, emails, SQL databases, API "scrapes" to a datacube from Bloomberg) which treated the data and then fed it into a CreditGrades algorithm to infer values for different indicators using the "knowns". For instance, implied CDS prices could be compared to actual trading CDS prices by using the other "knowns" such as implied volatility, equity prices, equity option price and debt levels.
In summary
1992 - 1993 : National Grid Technology and Science Laboratories, Overhead Lines Division, Plant Technology.
1995 : Sponsored summer project ("The Role of Computers in Transportation Technology") - Royal Academy of Engineering / Royal Aeronautical Society.
1997 : Ecole Centrale De Lyon project on RideSharing using groupware technologies, Monsieur Christian Vial, oversaw. We dubbed it Project Lugh, after the Celtic deity for whom Lyon is named.
1998 - 2003 : Various exposures to financial systems front-office, back-office and middle office computer systems at investment banks and multinational firms
2003 - 2004 : Project at Xaraf LLC / Paloma Partners (was the basis of my H1-B job offer). Credit Default Swap / Convertible Bond trading and Capital Structure Arbitrage trading strategies. It is here I came up with my credit contagion ideas which turned out to be so prescient.
2004 - Present : Texxi
‘I have argued that regulation can usefully be reduced and the role of the market increased, not only at the wholesale and retail levels but also with respect to monopoly networks.’ - Professor Stephen Littlechild.

Introduction
The fundamental barrier to effective ridesharing is that of information - the buyers and sellers cannot find one another in a narrow enough window of time.

Of course, theoretically we could always match up buyers and sellers, if we were not constrained by time windows or the proclivities of real-life people who often are likely to opt for the greater certainty of a private automobile. We also could theoretically model the "correct price" for a trip, but this would be a rather vain and conceited attempt to shoehorn real people into a theoretical model. The same was tried for finance with rather disastrous results in September 2008.

Thus it is better to work in the realm of heuristics and to set up adaptable models, not attempting the pretence of knowledge when it comes to what customers will do in any given situation. The only thing we can rely upon is the actual observed behaviours for a particular demographic under a particular set of conditions. The same demographic may indeed exhibit quite different behaviour in two (for all intents and purposes) "identical" cities.

There is no intermediate mechanism for linking the myriad demands (or indeed requests for information - "Price Levels" - or advertisements of offers "Shows") between buyers and sellers. An historically proven method of mitigating this seemingly insurmountable obstacle is that of a commodity exchange.

Before the advent of agricultural exchanges, farmers suffered from immense uncertainty. They could not be sure that their crops would have buyers or that indeed they would not be ruined by a flood, drought or some kind of crop failure based on weather or pestilence. As a result, the total amount of food that could be produced was limited and farmers did not enjoy much security.

Yet everyone still had to eat.

The appearance of exchanges changed all that

History of Commodity Markets ( http://www.futurestech.net/history.htm )
The fundamental principles that underlie commodity futures trading and the function of commodity exchanges are centuries old. Markets had already attained a degree of formalization in ancient Greece and Rome with a fixed time and place for trading a marketplace, common barter and currency systems, and a practice of contracting for future delivery.

The Agora in Athens originated as a commercial marketplace and later became the center of Athenian political and maritime power. The Forum in Rome was initially established as a trading center. At the height of the Roman Empire, 19 such trading centers, called Fora Vendalia (sales markets), served as distribution centers for commodities that the Romans brought from the far corners of the Empire.

MEDIEVAL MARKETS

Despite the fall of those civilizations, the basic principles of the central marketplace survived the Dark Ages, even though the widespread flow of commerce was disrupted. During feudal times, the scope of trading contracted into scattered local markets. The practice of preannounced markets at fixed times and places reemerged in the form of the medieval fair, arranged b the first trade associations formed by merchants, craftsmen, and promoters who organized regional fairs with the aid of political authorities. Pieds Poudres, or "men of dusty feet," as they were known, traveled from town to town arranging and promoting the fairs.

As trading practices became formalized in England, specialization developed. Certain fairs became the focus of trading between the English and Flemish, while others specialized in trade between English and Spanish, Italian, or French merchants. In 1215, the right of foreign merchants to travel freely to and from the fairs in England was established in the Magna Carta. In the 13th century, most trading at the fairs was spot (cash), for immediate delivery; but the practice of contracting for merchandise for later delivery, with standards of quality established by samples, had begun.

SELF - REGULATION ARBITRATION

In the 18th century, commodity exchanges followed some of the practices of the medieval fair in adopting rules for self-regulation and methods of arbitration and enforcement. The chief contribution of the medieval fair to modern commerce was the formalization of trading practices, which were codified and became known in medieval England as the Law Merchant. This code established standards of conduct acceptable to local authorities. In some cases, standards were minimal, but they formed a basis for common practices in the use of contracts, bills of sale and lading, warehouse receipts, letters of credit, transfer of deeds, and other bills of exchange. Any merchant who violated a provision of the code could be expelled by his fellow merchants. This principle of self-regulation was found in England’s Common Law, was followed in the American colonies, and was later adopted by the individual states.

The English merchant associations obtained the right from local and national political authorities to administer their own rules of conduct and established the courts of the fair, also known as the counts of the Pieds Poudres, to arbitrate disputes between buyers and sellers and promptly enforce their judgments with assessments of penalties and awards of damages. By the time these courts received full official recognition by English Common Law courts in the 14th century, their jurisdiction superseded that of the local courts.

EARLY COMMODITY MARKETS

The regional fairs declined in importance with improvements in transportation and communication and with the development of the modern city. Specialized market centers were developed in their place in many parts of the world. In Europe, these markets were variously called by the names Fourse, Boerse, Beurs, and in Spanish-speaking areas, Bolsa. The word comes from the surname of an 18th century innkeeper, Van der Beurs, whose establishment in Bruges, Belgium, became a gathering place for local commerce. Initially, these markets were held in the open air, usually in town squares. They later moved inside to teahouses and inns, and finally found more permanent locations of their own.

The development of the Bourses and Exchanges was not limited to England and Europe. At the same time, similar markets were formed in Japan and the United States. Japan’s commodity exchanges date to the 1700’s and preceded her securities markets by nearly a century and a half. This pattern is generally the reverse of that in Europe, England, and the United States, where securities markets usually predated commodity markets. Spot, or cash, trading in rice, the most widely used staple food in Japan, dates from the early 1700’s and forward contracting in rice on the Osaka Rice Exchange was legally recognized in 1730. Forward contracting is a transaction in which buyer and seller agree upon payment for and delivery of a specified quality and quantity of goods at a specified future date. Though there were as many as eight commodity exchanges in major Japanese population centers, the Osaka market was the largest. There were also Japanese markets for edible oils, cotton, and precious metals, though their trading volume was small in comparison with that for rice.

U.S. COMMODITY MARKETS

As early as 1752, there was an exchange in New York for trading in domestic produce. A series of small markets developed in New York and in other cities. While none of these markets exists today, they are the foundations for several of the present New York commodity exchanges. These early markets served other functions in addition to that of providing a place for trading. They attracted diverse business interests, brokers, ship owners, financiers, and speculators with risk capital, as well as primary producers and users of commodities.

The early commodity markets existed primarily for cash transactions with immediate delivery. They greatly enhanced the ease and scope of trade in all types of commodities - food and foodstuffs, textiles, hides, metals, and lumber. However, the practices of spot trading and forward contracting were not adequate to meet the problems of the sudden shifts in supply, demand and consequently, price that had always vexed producers of basic commodities.

SUPPLY / DEMAND CHAOS

In the early 1800’s, it was common for farmers to bring grain and livestock to regional markets at a given time each year. They often found that the supply of meat and grain far exceeded the immediate short-term needs of packers and millers. These processors, seeing more than adequate supplies, would bid the lowest price. Often, the short-term demand could not absorb the glut of commodities at any price, however low, and goods were dumped in the street for lack of buyers.

The marketing situation in Chicago was particularly aggravated by the lack of adequate storage and transportation facilities. Throughout most of the year, snow and rains made the dirt roads from country farmlands to the city impassable. Once the commodities reached the city, buyers were faced with the problem of inadequate storage space. Underdeveloped harbor facilities impeded the shipment of grain to eastern markets and the return movement of needed manufactured goods to western cities. The commodity exchanges, when they were organized, recognized the great need for improved transportation and storage and were a major force behind legislative efforts to improve rural roads, build inland waterways, and expand storage and harbor facilities. The exchanges made a particular contribution in leading the way to the establishment of accepted standards of grades and measures.

These efforts often bogged down in financial and legislative failure and the dismal marketing situation continued. The glut of commodities at harvest time was only part of the problem. Inevitably, there were years of crop failure and extreme shortages. Even in years of abundant yield, supplies were exhausted, prices soared, and people went hungry several months after the fall harvest and marketing of grain and livestock. Businessmen could be faced with bankruptcy because they lacked raw materials to keep their operations going. In this situation, the rural population, though having sufficient food for themselves, had crops they couldn’t sell, and therefore, did not have the income to pay for needed manufactured products - tools, building materials, textiles.

EMERGENCE OF FUTURES CONTRACTS

Imaginative men rarely tolerate such conditions for long. Some farmers and merchants had already begun to make contracts for forward delivery. This at least assured them of having a seller or buyer for their commodities. This practice of forward contracting was used in Chicago shortly after the city was founded in 1833. In 1848, a group of 82 men representing broad business interests formed the Chicago Board of Trade. Forward contracting, as well as cash trading, was practiced on the new Exchange. The problems of supply and demand were compounded by the Civil War. This stimulated the development of futures contracts.

Forward contracting solved the basic problem of finding a buyer for the seller and vice versa. It could, however, do nothing to control the financial risk that occurred with unforeseen price changes resulting from crop failures, loss of ships, inadequate storage and transportation, or economic factors. Hedging in futures developed to minimize pure risk.

Although most records were destroyed in the Great Chicago Fire of 1871, it is generally agreed that futures contracts were in use on the Chicago Board of Trade in the 1860’s.

FORMATIVE YEARS

The late 1800’s were critical years to the scope and efficiency of futures trading. In this period, trading practices were formalized and standardization of contracts, rules of conduct, clearing and settlement procedures were established by the exchanges. Representing the diverse economic interest of their membership, the exchanges became effective spokesmen for, and innovators of, improvements in transportation, warehousing, and financing, which paved the way to expanded interstate and international trade.

DRTE Corollaries with Capital Markets

The need to give people with often varying needs a reliable transport system is not much different from the problem of bringing to market diverse generators in an electricity market or that of farmers trying to bring their produce to an agricultural market.

Our empirical research has shown us that the perception of reliability is as important as any actual technological component of the system. Without an initial unshakeable trust in any rideshare system to deliver transport solutions (whatever the cost), there will be no continuity and no scaling of the market - the so-called "market formation problem".

This has less to do with optimisation algorithms and precise predictions of uptake than a fundamentally marketing-based exposition of the problem at hand - people will not change their travel habits unless they are convinced that they will definitely get transport when they need it and that it will be at least as convenient and as safe as what they would usually expect.

Of course, in high stress situations, where there is a shortage of transport, many of these concerns are put to one side, but in the general day-to-day choices, any demand responsive service has to compete with often highly subsidised and perceived as reliable scheduled services.

Where the DRT Exchange (DRTE) comes into its own is in its ability to deliver highly customised ride contracts - effectively "over-the-counter" (OTC) ride solutions for only a marginal premium over the bog standard scheduled service. This cannot be achieved without significant market-priming activity and this requires "market makers" - market participants who provide liquidity and counterparty trading reliability to an exchange.

"The existence of a Market Maker ensures that buy and sell orders can always be executed at some price without delays" (Hull, "Options, Futures and Other Derivatives").

Standard scheduled service replicable trips on the DRTE can be considered to be exchange traded futures. Highly customised trips can be considered to be OTC Futures. These may be for example, church service collection trips or supermarket trips for the time-sensitive.

Market Makers
A Market Maker facilitates and in some cases enables trading to happen on an exchange. It does this by being available to buy from sellers and sell to buyers at some price at any time.

In the case of ridesharing, historical markets have not been easy to form due to an imbalance of people who want to share rides and people who have rides to offer.

An intermediary in the form of an exchange can provide a transparent means to make this a reality, providing services such as liquidity (via Market Makers) to participants to allow matches to occur.

A Demand Responsive Transit Market Maker, after having analysed the travel behaviour in a city using GeoInformatics tools and analyses, would then have an appreciation of just where there is likely to be demand that can be met with supply the Market Maker provides. Taxi trips would be bought in such a way that a certain proportion of the fleet will be available to undertake these trips.

As such, the amount of liquidity that the Market Maker would need to provide would be much smaller if the analysis is correct, than if no information is known.

Ultimately, however, the customers will signal more effectively than any algorithm can predict, just what their demand is.

The analysis gives us a starting point for the liquidity estimation and for contract design and choice of marketing segment. It does not dominate precisely what we will do.

Agricultural and Commodity Markets and their Exchanges
The "good" in the case of a DRTE exchange will be a vehicle trip whose quality and key distinguishing features are described in as much detail as bushels of corn barrels of oil or bales of cotton would be on a commodity or agricultural exchange. The capacity of vehicle, the "rules of the ride", the waiting limit, the ranking of the driver, the ranking of co-passenger, the in-vehicle ambience and the redundancy of the trip ( a key feature for those whose trips are vital - they must know that at a worst case, another vehicle is available) are all qualities that must be known to each transaction partner and recorded for each transaction

There will be an overseer mechanism to identify and sanction market abuse. In the case where margin payments are required, the exchange can provide an escrow mechanism, requiring counterparties to deposit margin.

Electricity and Gas Markets and their Exchanges
In common with electricity and gas markets where both supply and demand may not be as predictable as for other commodities, there are certain key features to add to the basics of the exchange in order to account for the physical realities of virtualising transport requests as tradeable instruments.

Forward
A standard taxi trip is actually a forward - a highly customised private contract between buyer and seller in which no money changes hands until the point of delivery. There is significant risk undertaken on both sides if there is not already a prior trading history. Such contracts are not exchange traded.

Futures
A more sophisticated arrangement for taxi travel may actually be a "transit future".  This arrangement would permit buyers of transit contracts to spread their payments over a period of time as well taking advantage of the implicit guarantee of the market making and clearinghouse services available on the exchange. Contracts can move to be standardised form so that the most common types of contract are represented in an easily identified format. The likelihood is that the market depth will be at its greatest extent around such futures.

Options
A user may need to know for sure that he/she is guaranteed a trip. Thus an optionis going to be a key instrument to allow people to make plans for uncertain future transport arrangements. Call Options allow people to buy trips at a certain price in the future while Put Options enable those who have bought a bundle of trips to sell them back at a certain minimum price. This is an important hedging tool for those people who have to know their transport costs ahead of time

Swaps
Swaps are another vital risk management tool which allow users to exchange cashflows and tripflows. Two drivers may swap shifts and assuming they have a similar behaviour rating and vehicle type, they can now do so without incident.

Insurance
A key feature of any sophisticated market (and economy) is the existence of insurance - the means, for a price, to transfer the risk of calamity onto those who are better equipped to deal with it.

The Database of Transit Intentions
The boundaries of online search and actual travel are becoming increasingly blurred to the point where the two activities are becoming largely seamless.

One can now book a train ticket or buy an airline ticket in a matter of minutes after doing a rudimentary search on a travel site. A DRTE will make it so that there is not much difference between buying a ticket online and hailing a cab.

If one considers that the intentions of a large number of people start with an online search (including mobile online search) then there are two fulfilment paths to consider for the case of transport and logistics.

In the first path, the intention is fulfilled by moving an item from a warehouse to the person who executed the request. This is currently handled extremely effectively by the logistics business space. There is room for evolution in some regards (e.g. more rationalisation of orders), but generally it is a problem with a comprehensive set of tried and tested solutions. When the item required is digital in nature, the problem of delivery is handled even more effectively by the network / bandwidth provisioning companies. In this space of "digital logistics", we are seeing an increasing amount of innovation on a weekly basis - resulting in higher speeds/lower delivery times and lower costs.

In the second path, an intention is fulfilled by physically moving the requesting person to a new location. Despite this case resembling a postal service, when it comes to human beings this is handled neither particularly well nor seamlessly for the vast majority of cases (if the taxi experience is an indicator), with the exception of mass transit systems like rail, which restrict both the time of departure and constrain the choice of destinations. If we could instead consider personal transport to be a subset of normal logistics where one does a search for shipping companies, we could bring more efficiency and choice into the personal transport space.

Search Application
Assume I am a tourist in an unfamiliar foreign city researching an attraction to visit.

Normally I would use a guidebook and a (space-domain) map, figure out which attraction I wanted to see, where the attraction was located, then calculate how to get there using available options, constrained by my particular proclivities for timing, price and quality. I would then go to find the specific transport mode and attempt to coincide its itinerary with my personal schedule.

Now with an evolved DRT Exchange model, I would simply use either my handheld mobile communications device or a summoning plinth with either a time-location-domain map of attractions OR a cost-location-domain map of attractions OR an eco-cost-location-domain map (these are maps which show loci depending on how long it takes to reach a location or how much it costs to get there; the actual distance is normally a secondary consideration, it normally has some reasonable relationship to the time taken to reach a destination where normal supply-demand patterns are followed).

An added dimension is that of spatio-temporal-location maps - maps whose distances / prices change with the hours of the day - these changes being a function of congestion.

Thus a new type of interface is needed; one which allows a person to link together all the forms of transport needed to execute a mission. This multi-modal interface effectively acts as an intelligent travel agent within an advanced transport information system, operating within the context of a larger search application for transit.

Zeitgeist
The intentions themselves can serve to shape what the vehicle operators do, much like Amazon has the suggest feature based on one's search history. The intentions (whether fulfilled or not) of millions of people will be very important in helping to shape the nature of a transport system.

Ratings System
Passengers can vote on one another, their driver and the quality of the vehicle.
The driver can vote on passengers.
The driver's punctuality can be assessed by the system using GPS tracking.

Participants on the DRT Exchange
Vanpools (commercial)
Carpools (commercial or private)
Rental Cars / CarClubs / Carsharing schemes
PRT Systems (automated taxis)
Buses, Coaches, Soccerbuses, Tourbuses
Private Jets / Charter Aircraft
Charter Trains