Institutional Design and the Wisdom of Crowds + Cryptocurrency and the Fall of Wall Street

This is a great discussion on how provides all of their employees with the same dashboard and allows them to submit, collaborate, and vote on ideas to make the business better. The results are reported instantly to the leadership on their dashboards so that they can make decisions with better information. It allows the employees with the knowledge of day-to-day operations decide what’s best for the company.

It looks like they have been very successful in finding the most efficient way to do business.

The rest of the discussion gets into the corruption on Wall Street and how blockchain technology can be used to allow peer-to-peer trading, thereby eliminating the need for Wall Street and Central banks. What I learned from this portion of the talk disturbed me deeply. Finding out that no one owns the stocks in their portfolio and that it is all held by a single corporation is a bit scary.

That leads to what he describes as the “Deep Capture”, where the regulators of the market are themselves benefiting from the regulations they impose. And, that the journalists reporting on the economy are all heavily influenced by a few hedge funds with all the power. Plus, the politicians responsible for passing the laws that govern the regulators are also benefiting from the laws they pass. That’s my layman’s understanding of it. I’m sure it is deeper in scope than what I describe. It’s definitely worth reading.

Take a look at for a great education on the various ways people are having their money stolen by thieves on Wall Street.

The realization of how much actual trading is taking place versus the stock quotes taking place and the computers trading with each other at the rate of 10,00 trades per second makes me uneasy as well.

He mentions the “bezzle”, which is defined like this: Freeze time and ask everyone that has investments in the stock market how much they have, then look at the value of what is actually there. There is a huge gap in what people say they have versus what is actually there. This is called the “bezzle”, because that’s what people are embezzling from the system.

I am inspired to learn more about cryptocurrencies. While BitCoin may not be the standard in the future, I believe that it’s worth looking at. More and more companies are taking BitCoins as payment and many jobs are available that pay in BitCoin. It’s also defined by the IRS as property, so it is subject to capital gains tax.