You're welcome. It seems our positions are not very popular here, but I can't understand why. For me, the strongest argument against it and the strangest conclusion from my premises is that a superintelligent AI would change its utility function to the simplest one, as described here. But I don't see why it shouldn't do that. What do you think about this? By the way, have I convinced you to accept total hedonistic utilitarianism?

Strong upvoted. Wrote roughly similar thing, but I think that this position leads to total hedonistic utilitarianism, and that the "retrospective probability of finding oneself as another point" in the block universe of empty individualism could even force a superintelligence to change the utility function to the simplest. I'm interested in your opinion on this matter, since you seem to share some of my premises and you don't seem to be a total hedonistic utilitarian, so you can probably prove me wrong. I won't make you read the whole post if you don't want to, but in short - I think that you cannot strive for complex values, because the "joy of scientific discovery" or something among these lines will not be experienced by you-point and you could find yourself with different values, so it only makes sense to maximize pure pleasure.

To be fair, before publishing I thought this currency could be implemented in a real world environment with less improbability. My current main doubt is "how can the market cap be so volatile with a stable GDP, and would they be closer to each other in a more adequate equilibrium?". And I've basically switched to "okay oops, but under what conditions could this theoretically work, if could at all, and could you imagine better theoretical peak conditions?" mode. Deflation seems like a reasonable danger, I just can't see how it could be avoided if everyone used market fractions at least to store their money if not to exchange. Because, like, you don't introduce a random money-making machine into the system to solve your psychological problems at the cost of 2% of your money, there's no place for it, so I'm guessing that people would adapt to that, and there's a fictional example of dath ilan that such adaptation is real.

Thanks for the info, I'm not active in the discord but will consider joining now, sounds interesting. As I understand it, the "NGDPLT-indexed inflationary unit of account" is not the "fraction system" I proposed, and in fact Eliezer thinks that using inflation-deflation is adequate because even utopian coordination and higher average intelligence are not enough for everyone in the economy to simply behave adequately. Now I wonder if the system can simply be so sane that deflation in particular will not have a negative effect and people will simply efficiently preserve jobs, set and accept prices, and market cap is stable and close to GDP, etc. If it is really possible to train people out of bias or create a system with lower structural bias so to say.

In dath ilan, inflation and deflation are not used as macroeconomic tools because people are rational enough to accept wage reductions if their purchasing power remains unchanged, or to voluntarily pay the government to prevent crises without the need for a hidden tax that dilutes money by printing more during a crisis. Interest rates on loans could be lower if you expect returns that outpace deflation. If people can afford not to work, they are expected to do so, and they would spend more "shares", redistributing them in favor of those who are more eager to work. Perhaps you aren't really interested in having people work that much or that often, especially if you're aiming for a utopia with a four-hour workday, or something similar. How relevant are these issues in a world where "every person is economist in the same way every earthling is a scribe by medieval standards"?

I admit my mistake in intuitively assuming that GDP and stock market valuations should be closely linked. But it still seems strange to me why they aren’t, and I want to understand that better. Shouldn’t they at least be highly correlated in an idealized model?

Think of stocks as a kind of prediction market for a company’s value. The stock price should reflect expectations about its future earnings, but those expectations are built on something—maybe a new technology they’ve developed, or an undervalued specialist. If that’s the case, then why isn’t the market naturally structured in a way that adjusts salaries dynamically based on predicted contributions? Why don’t we have, say, ‘patent usage shares’ that investors can buy to increase expected royalties on a promising technology?

In an efficient system, I’d expect the market to fragment into these kinds of sub-sectors—where you can bet not just on the company as a whole, but on specific assets or individuals within it. And you love all these equal-surplus deals, so you're interested in getting that kind of accurate valuation. If you believe a specialist is undervalued, you don’t just buy the company’s stock, you invest in their salary in exchange for a share of the revenue they generate. If you believe a company’s R&D is its most valuable asset, you invest in the future licensing income of its patents rather than the entire stock.

If this kind of structure existed, wouldn’t stock prices and the actual underlying value of companies align more closely? And if they don’t, does that mean GDP is failing to capture certain kinds of value—like knowledge, which isn’t easily tradeable? Or should stock prices themselves be less volatile than they currently are?

I also don’t see how the fact that share prices are set by the latest trade changes this dynamic. If I’m missing something fundamental here, I’d love to hear your perspective. I understand that simply saying ‘the market is irrational’ is not a good correction—it’s probably smarter than I am—but maybe it isn’t structured in the most optimal way, for example, it doesn't pay people for their expected value, or there’s something key I’m overlooking?

Because only the most wealthy people on earth keep their money in stocks, but they need to somehow communicate with all the other people who don't, so they only exchange "money for the worse money everyone else uses" when they trade. If everyone kept their money in stocks, I would expect people to exchange them directly without exchanging money for money, because you actually have to analyze MORE if you have two different currencies that you use for different purposes.

To the extent they don't have epidemics or handle them better, and don't elect Trump, it's probably more stable.

Not enough. In my understanding, GDP is REALITY and shares as a representation of your expectations somehow do not correspond to reality by tens of percent, which is worse than even our earthly prediction markets. If you, say, build a power plant with a payback in 10 years, in an efficient market the expected repair costs, service life, the chance of displacement by other technologies, and so on are already included in the price of this asset, so the increase in GDP (the cost of the plant as an asset) and the capitalization of shares (expectations) should correspond?

Understandable, but would you expect that in an efficient dath-ilani-like rational market, expectations would tend more to... match production with minor deviations? This is probably the crux here - if no reasonable amount of average person thinkoomph changes the radical fluctuations in expectations, then this currency is inefficient for regular shopping purposes and I say oops. I still can't imagine what currency would be better than this, though, because I can't think of a better way to say "I'm just as smart as the market" than to put my entire stake in the market.

The main reason economists like inflation is because it allows companies to lower real wages of underperforming workers without having to actually give them a pay cut.

Yeah, I remember this part, and also the part where dath ilan don't use it anyway, because instead they can just "order everyone to step to the right once" and accept those wages and people are sane enough to do so.

I didn't know that was a self deprecating quote because there's no link to its origin.

Corrected to "(C) Chief of Exception Handling" which I hope isn't a spoiler because it adds virtually no information, but it makes it clear that this is a joke from within the dath ilan? And this is easier than hiding the whole thing as a spoiler? My illusion of transparency will kill me.

Around 2021 it fell by over a quarter in the space of a year, and over the last week it's gone down by 3%.

Wow, okay. I would expect that in an efficient market, a quarter reduction in global capitalization would correspond to something like a mass extinction? Maybe this problem can be solved with a higher level of sanity, but it points to why this is a very utopian model that is far from implementation, at least for Earthlings. I did a little less Googling than was necessary and instead looked at GDP, which seemed like a reasonable guide to global market growth. Of course, you don't store stocks in GDP, but I would expect stocks to gravitate toward it.

Am I somehow fundamentally wrong here that a quarter drop in global capitalization should NOT look like literally "wiping out a quarter of the world's assets" including, for example, the corresponding number of people? It's hard for me to imagine why exactly these fluctuations are so large.