In the beginning, there was autarky: People scratching out an existence by the work of their hands for their own benefit. This is the farmer, or perhaps the farmer and family, living remotely, raising their own food, storing their own produce, and building their own homes. Isolated and living off the social grid, this group exists in an economically difficult world. Difficult because it prevented specialization. Specialization is good because it enables individuals to become highly efficient at achieving outcomes, building machines, innovating new technologies, etc. Alas, with the pressing need for food, no one living in autarky could specialize. Without the extra time afforded by specialization, no one could invent a tractor to make life easier.

Autarky begins to fray when two farmers meet. One may have produced excess goods with which he would be willing to part. If he finds a second farmer that has produced an excess of something attractive, he may be willing to barter to exchange it. This enables both farmers to be better off and can support some specialization as one farmer produces one good and the other produces another. Unfortunately, if these farmers cannot find each other, or do not have a match of excess goods that are in turn reciprocally desired, a problem emerges. Economists refer to this as the “double coincidence” problem. It reflects an existential problem with barter that arises from a complex world in which people need many things, but can only produce a small amount of them in excess. For barter to work, there must be a “double coincidence” of 2 people having goods in excess that the other also happens to want.

The double coincidence problem also is implicated when 3 people each have produced goods in excess, but the desires of each person create a circle of wants that cannot be satisfied by any 2 people acting independently. The generalization of this lack of a double coincidence gives rise to the market, as in a farmer’s market.

Such a market serves the needs of many people who, through some form of planning and communication all agree to show up at one place with their excess goods and find ways of solving their lack of double coincidence. Clearly a complex chain of goods and the need to exchange them limits how efficiently this market can resolve the desires of its participants. This then sets the stage for the next innovation, the general store.

The general store is remarkable for the ledger and warehouse that it maintains. The ledger is a spreadsheet-like account of the goods that individuals have left at the general store: a book of credit. By establishing a ledger and a warehouse for goods, the general store proprietor enables people to delegate their interest in trading to him. This in exchange for being able to bring their goods to the store at any time. If a farmer brings eggs to the general store, he can leave them there, having duly received credit for the donation in the ledger, and at some point in the future he can use that credit to purchase different goods left by others. While more efficient, there remain several problems that must be negotiated by the participants. The first problem is agreeing on the value of the consigned goods in terms of other goods. In a simple world like this, there is no agreed standard of accounting.

The second problem is that of scale. The general store experiences this in three ways. The first is that the warehouse has limited capacity. It cannot accept unlimited eggs. There would not be space to keep them all. The second scaling problem is with the size of the community. You may be able to produce many eggs efficiently (with the help of your hens), and the warehouse may be able to accommodate them all, but there may not be a big enough demand for your surplus in the community. Together, with your egg-farming ilk, there may be too many people producing eggs such that they rot before the community consumes them. The third scaling problem is that there may be so many people participating in this general store that it is not possible for a single geographically located warehouse, accounted for by a single physical ledger and a lone proprietor, to accommodate them all.

A decentralized ledger of credit would accommodate these challenges such that scaling is no longer the predominant problem.Similar Posts:

• The Transition from Barter to Fiat Money
• Here’s how I created a more secure bitcoin wallet with paper keys
• Four levels of counterfeit protection
• Where the Action is

“How did it become possible to exchange apparently valueless pieces of paper for goods? This paper provides an equilibrium account of the transition between barter in and fiat-money regimes. The explanation relies on the intervention of a self-interested government which must be able to promise credibly to limit the issue of money. To achieve credibility, the government must offset the benefits of seigniorage by internalizing some of the macroeconomic externalities generated by the issue of fiat money. The governments patience and the extent of its involvement in the economy are key determinants of whether the transition can be accomplished.”

Joseph A. Ritter wrote an interesting economics article that presented models of economic theory that explains how a transition from barter economies to fiat money could occur. An interesting result of his analysis is a theoretical justification for why a government is necessary for fiat money to come into existence. For that money to be considered valuable, the government must convince the other agents in the economy that the amount of money to be printed will be kept with certain bounds. This is possible after the government has established itself as a large part of the economy and has the expectation of longevity with the agents.

Some of the interesting parts of the article included a reference to Kiyotaki and Wright’s paper, “On Money as a Medium of Exchange” which I now feel like I need to read. The following quotes were also thought-provoking or confirmational:

“The historical evolution of money is generally thought to proceed from barter to commodity money to fiat money, and the transition has been punctuated by many reversals.”

“A new government may have a “honeymoon period,” which it can perhaps extend by a period of conservative monetary policy and by legal restrictions on the use of other monies, but when the government attempts to exploit this source of revenue, perhaps because of changing preferences or circumstances, evidence accumulates against it, and agents’ valuation of the currency changes. As the government repudiates its promises, individuals repudiate its currency.”

“… a transition to unbacked money can be accomplished, even in a perfect-foresight economy, if and only if the government has some means of making credible its promise to restrict the use of the printing press.”

I didn’t understand what the terms “autarky” and “seignorage” meant. We’re going to discuss the paper tomorrow morning and I may revise this post after that discussion.Similar Posts:

• Four levels of counterfeit protection
• A Teleological Account of Money, Part 1
• Local data vs Localized data: When are they the same?
• Notes from ISWC 2005
• Location-based Activity Recognition using Relational Markov Networks

The currency itself takes one of two forms. The first is a coin object and the second is a bill. The coin is 3D printed and assembled by hand so that we can embed it with an RFID tag at the time of manufacture. The bill is made from Japanese washi paper and is two-ply. During assembly the two plies are glued together with an RFID tag embedded between the sheets. The paper is embossed and a serial number is printed on both sides. The RFID has cryptographic functionality that enables the data that is on it to be read by NFC enabled smart phones without a password, but only can be changed with a password. The data on the RFID is a code that is registered with our trusted database.

The first level of counterfeit protection is the physical material that the currency is manufactured with. By feeling, and inspecting the currency, a party in an exchange can evaluate whether or not it seems as if the currency is legitimate. Evaluating features such as the material, the serial number and the presence of an RFID are indicators that the currency is backed by us.

The second level of protection involves a smartphone which is not network enabled, but is running our application. Our application can read the data stored on the RFID and display the serial number associate with the bill on the screen. By verifying that the serial number printed on the currency matches the application, the holder of the currency gains more confidence in it’s legitimacy because the RFID, the physical instrument and the application all agree.

The third level of protection involves a smartphone with network access. In addition to the previous steps, network access enables the phone to request the current status of this bill or coin from the central currency tracking database. By evaluating the sequence, timing and location of scans of this piece of currency, we are able to provide an probabilistic evaluation of whether or not the currency is genuine.

Finally the ultimate confidence in the currency is enabled by returning the currency to us. When the currency is in hand, we, using a trusted reader, can check to see if the password is recognized by the RFID and if so, the currency is almost certainly valid.

These levels enable the currency to be used as a store of value and a medium of exchange even in the event of partial computing infrastructure collapse that may result in significant effort needing to be expended in order to get power or internet connectivity for a level 2 or 3 validation.

Similar Posts:

• The Transition from Barter to Fiat Money
• Here’s how I created a more secure bitcoin wallet with paper keys
• A Teleological Account of Money, Part 1
• Real-Time is Prime-Time for Scams

“HTML5 is most often thought of broadly to include new versions of the markup language itself and its associated standard for accessing and manipulating HTML documents, the Document Object Model; Cascading Style Sheets (CSS), a language to define the presentation and appearance of an HTML document; and the JavaScript scripting language. The term is often used even more broadly to include specific application programming interfaces (APIs), such as those that enable new browser-based graphics, geolocation, local storage, and video capabilities.”

I didn’t keep the reference. Comment if you know it. Maybe ACM Communications?

Similar Posts:

• How to make Processing work from within a Java Application
• Resizing a VMWare LVM partition
• Notes from ISWC 2005
• Twitter is a Low-Bandwidth Multicast Internet
• T-Mobile, Mac OS X, Bluetooth GPRS connectivity

So after some digging I discovered this post on StackOverflow which clued me into the “MaxClients” setting in apache. I reduced this from 150 to 25 and so far the box is doing much better. It seems to be getting a lot of hits. Maybe something went semi-viral, but at least it’s staying up now.

Similar Posts:

• Resizing a VMWare LVM partition
• Ripping a TurboTax DVD image to an .iso file on a Mac

A bitcoin key-pair is a way to create an “account” from and to which you can spend and receive bitcoins.   The private key is required in order to spend money from the account.  The public key is required in order to send money to the account.   Generally one wants to keep the private key very secure so that other people can’t spend your bitcoins:  like cash that you put in the mail, once you send bitcoin you can’t easily get it back.

A “wallet” contains zero or more key-pairs.

It is also important that you don’t lose your private key.  That is considerably easier to manage as you can simply create several paper copies and distribute them in diverse secure locations.

To create a key-pair which is secure against theft and in particular spyware I did the following:

• I used VirtualBox for Mac and created a new virtual machine on my computer that was not connected to the Internet.
• I installed Ubuntu 11.10 on it from an .iso image.
• I downloaded a copy of bitaddress.org, a client-side bitcoin key-pair generator onto a thumb drive
• I mounted the thumb drive in the virtual machine
• I opened the offline copy of bitaddress in the virtual machine
• I generated a key-pair in a browser
• I printed it to a .pdf on the thumb drive
• I mounted the thumb drive on the host Mac and printed out the paper wallet.
• Then I used the “shred” utility to destroy the pdf file.

Some possible places where this could be insecure.  My key would be compromised:

• … if my host computer had some kind of spyware on it that was doing a live screen capture and sending it somewhere.  The screen capture would have the private key on it in the pixels that were shown from the virtual machine.  If a bad guy got the screen capture she could spend my bitcoin.
• … if the code that I downloaded from bitaddress was compromised to give me a non-new or non-random key-pair.  Then whomever wrote the code could just try the key-pair they knew I was going to generate to spend my bitcoin.
• … if I didn’t delete the pdf with the bitcoin address on it securely.  Then the bad guy could recover the document from my Trash can or forensically from the hard drive.
• … if Time Machine captured the pdf and stored it for automatic backup.  (I didn’t move it off the thumb drive to avoid this.)  Then the bad guy could find the key in my backed up hard drive data.
• … if the print process were compromised (e.g., as described here).  This is similar to the screen capture attack but with printers.

Finally to see that my system worked, I sent a small amount of bitcoin to the public key on my paper wallet.

• In the process of doing this I realized that the QR codes that I printed out on my paper wallet were too small to scan.  This is actually really important because when you send coins, you don’t want to mistype the address you are sending them to.  You can never get them back.  So it’s better to automatically enter them.
• I found that so far, it only looks like Mt. Gox will let you enter a private key to retrieve funds.  They treat it like you are redeeming a gift card which I think is clever.  At first, it wasn’t clear that it worked though, so I started looking for another option and found pywallet.  While I was messing with pywallet, Mt. Gox posted the balance from the private key and transferred the money from it to my Mt. Gox account.  This is great as long you trust Mt.Gox because they can send the bitcoins anywhere they like.
• I also used the pywallet program.  This python script lets you add a private key to your local bitcoin wallet. In the process I edited my wallet while my bitcoin client was running (despite the warnings) and corrupted my wallet.  I lost an hour restoring my backed up wallet.  (Thanks Time Machine!)  In this process I learned that pywallet doesn’t yet work with encrypted wallets.  So to recover funds from a private key, start a new unencrypted wallet, import your private key with pywallet, immediately transfer the bitcoins from the private key to a key in an encrypted wallet.
• I also ended up with a transaction in my bitcoin client that I didn’t understand.  That made me nervous.

I wasn’t very happy with how smoothly the first paper wallet went, so I tried it again using the lessons learned and it went much better:

• I made a new paper key-pair in a virtual machine.
• I printed it out as a pdf on the thumb drive
• I moved the thumb drive to my Mac and verified that I could scan the codes when I printed it out at a higher scale.
• I sent some bitcoin to the public key of the paper key-pair.
• Once the transaction was confirmed I shut-down the bitcoin client, moved my normal encrypted wallet.dat file away
• I restarted the Bitcoin client which created a new unencrypted wallet.dat to manage the paper key-pair.
• I shut down the Bitcoin client
• I loaded the paper private-key into the unencrypted wallet.dat using pywallet.py
• I started the Bitcoin client with the unencrypted wallet.dat and sent the balance from the paper key-pair back to my normal wallet.
• I shutdown the Bitcoin client
• I replaced the original encrypted wallet.dat file and verified that bitcoin went back to my original wallet.

Mission Accomplished!

 Similar Posts:

• Ripping a TurboTax DVD image to an .iso file on a Mac
• Four levels of counterfeit protection
• A Good Week As a Professor
• The Transition from Barter to Fiat Money
• Twitter During Emergencies

My problem was that I was running a virtual machine in VMWare that didn’t have enough hard drive space. The underlying host machine did have more hard drive space. I wanted to increase the amount of disk space on the hosted virtual machine. Because linux tools (the main one being gparted) do not support increasing the size of an LVM partition this was hard.

I understand how to do this now, but figuring out the right sequence of things to do required me to learn about LVM (logical volume management) and was a bear.

For starters:

The host machine was running Ubuntu Linux 2.6.28 server edition.

The virtual machine was runnning Ubuntu Linux 2.6.24 desktop edition.

The first thing to do was to increase the size of the disk that VMWare was giving to the virtual machine. I did that in the VMWare control panel while the virtual machine was shutdown. Alternatively I could have created a new hard disk for the virtual machine. It would have ended up being the same, although I don’t know if there is a performance difference between the two.

Next I booted the virtual machine off of a live Ubuntu 10.04 iso image. This gave me a gui environment running on the virtual machine, but didn’t mount the disk.

If gparted supported resizing an LVM partition I would have been nearly done. I could have opened gparted and resized the partition into the newly available space. gparted did not support resizing LVMs, so I had to learn more.

What I needed to do next was explained by this image taken from here.

From the gui, I opened a terminal window and got root access, “sudo su”.

I created a new partition in the empty space using “fdisk”. I set the partition type to “8e” which is “LVM”. Then I wrote out the changes. At this point I had to reboot my virtual machine back into the live CD environment in order to get the changes to be seen when I ran “fdisk -l”.

Next I made the new partition into a physical volume, (I ran “apt-get install lvm2″ first) with the command, “pvcreate /dev/sda3″. Verified it worked with “pvdisplay”

Then I added the new physical volume to the existing volume group, “vgextend Ubuntu /dev/sda3″. I verified that it worked with “vgdisplay”.

Then I extended the logical volume to include the new space with “lvextend -l +100%FREE /dev/Ubuntu/root”. I verified that it worked with “lvdisplay”

Then I extended the underlying filesystem into the new space after cleaning it up with, “e2fsck -f /dev/Ubuntu/root” and then “resize2fs -f /dev/Ubuntu/root”

Then I ejected the .iso image from the virtual machine, rebooted it and the new disk was bigger! Yay! (In reality this took me a lot longer to figure out.)

One other useful command was “vgchange -a y” this enabled the Live CD Linux version to mount /dev/Ubuntu/root.

Thanks to this website for some insight into this.

Along the way I also shrunk the LVM partition and it’s about the same thing in reverse, but you just have to make sure that you don’t shrink things so much that you lose data. There are options in the tools that find out exactly how far you can go which was helpful. man pages are your friends.Similar Posts:

• Ripping a TurboTax DVD image to an .iso file on a Mac
• apache2 Resource Management with MaxClients
• Twitter is a Low-Bandwidth Multicast Internet
• How to make Processing work from within a Java Application
• Local data vs Localized data: When are they the same?

An organization called Artificial Intelligence for Development (AI-D) recently had a workshop at Stanford which looked at ways that data driven statistical modeling and prediction could be used to help under-served populations in the developing world.

One of the papers that came out of that conference was called “People, Quakes, and Communications: Inferences from Call Dynamics about a Seismic Event and its Influences on a Population“. It was written by researchers at Microsoft and at the Santa Fe Institute, Ashish Kapoor, Eric Horvitz, and Nathan Eagle. They are all terrific researchers who have a much better track record than I do.

The basic foundation for the paper was a large dataset of calls that were made in Rwanda in 2008. During this time frame an earthquake with a 5.9 magnitude occurred. The paper examined ways of determining:

1. Whether an earthquake happened.

2. Where it happened.

3. Where you need more information to reduce uncertainty.

In terms of determining where an earthquake happened, the paper actually recognized that something unusual happened that affected call patterns. It was not correct to say that it recognizes earthquakes, but when applied to the data that contained an earthquake, it did recognize the earthquake as out of the usual.

In terms of determining where it happened, the paper assumed a model in which the the degree of unusualness fell off with the proposed distance from the closest call tower. The problem of finding where the earthquake occurred then reduced to a search over all locations for the location that best explained the observed disruption. I think this approach would work for a brief moment after an earthquake occurs, when call pattern disruption is dominated by calls in and out of the immediately affected area, but I think that very quickly calls would start being made all over the place as word spread regionally. This approach also assumes that an earthquake only really affects one location, that locations are defined by the cell phone towers and that there is a cell phone tower where the earthquake occurs.

In terms of the final contribution, I didn’t understand the paper’s approach. At a high level it was a decision theoretic approach that argued for surveying unknown locations that reduce uncertainty the most. But in terms of cell-phone data, how is it that you don’t have the data already? What does it mean to go survey an unknown location for cell-phone activity? The math was pretty complex when you start to apply the DT approach, so I may have missed something here. Nevertheless the motivation was cool. Wouldn’t it be nice to have a disaster management computer that told you where you would benefit the most by sending scouts?

Despite my critique, this paper was exciting because it contained real meaningful data and took a well-grounded stab at solving an important and hard problem.

Similar Posts:

• Local data vs Localized data: When are they the same?
• Using social networks to guide recommendation systems
• Notes from ISWC 2005
• Paper Review Comments
• Real-Time is Prime-Time for Scams

I have a copy of TurboTax that I want to install on a Windows virtual machine. In order to do that I need to insert the DVD in the underlying host hardware first. Unfortunately that requires physical access to the host hardware which I don’t have right now. Instead what I want to do is to send a software image (.iso file) of the DVD to the host machine over the network, have the host machine mount the .iso file and then my virtual machine will think the DVD is inserted in it’s hardware. Further complicated matters is the fact that I have a MacBook Pro running OSX 10.5.8.

Since the Mac mounts the disk in a different way from the way Windows mounts the disk, I first need to make my Mac mount the disk like a Windows box would. Here is what I did based on this hint:

1. I inserted the disk into my Mac
2. executed:

   mount

   to figure out which disk I was working with

3. executed:

   sudo umount /Volume/TurboTax\ Premier\ 2009

   , to disconnect from the disk without ejecting it

4. executed:

   mkdir /Volumes/Turbo.win

   , as a new mount point

5. executed:

   mount_cd9660 -er /dev/disk2 /Volumes/Turbo.win

   , to mount the disk as a Windows box would.

Now I can cd to Turbo.win and see all the windows files that were hidden from me when I used the natural Mac mounting technique of inserting-the-disk-in-the-drive.

So I now I need to rip the DVD into an .iso file which I based on this hint

1. execute:

   dd if=/dev/disk2 of=myFile.iso

Voilá all done. Then I compressed the file. Sent it across the network. Decompressed it. Mounted it, and installed TurboTax on my virtual machine.

A few cleanup steps are to eject the disk on my Mac.

diskutil eject /dev/disk2

, and to erase the mount point,

rmdir /Volumes/Turbo.win

Similar Posts:

• Resizing a VMWare LVM partition
• Here’s how I created a more secure bitcoin wallet with paper keys
• Twitter is a Low-Bandwidth Multicast Internet
• apache2 Resource Management with MaxClients
• T-Mobile, Mac OS X, Bluetooth GPRS connectivity

I had a brief panic earlier this week. For a few hours I thought the Internet was on the verge of collapse. The sudden concern was brought about by trying to find season 1 episode 1 of “Glee” online somewhere.

My first thought was to go to Hulu.com as this has become my new authority for legal online television. It turns out that only the last 5 episodes of Glee are available on Hulu. A fascinating conversation with a Fox executive taught me about how that is the result of a legacy method of licensing the content for television programs that has been shoehorned into the Internet TV age. It used to be that shows followed a path from brand-new to syndication in a well-ordered manner which doesn’t match well with the expectations the public have of finding all shows archived on the Internet somewhere. That, however, is tangential to my panic.

Unsuccessful on hulu, I started doing just a general Google search and turned up many many many pages purporting to be Glee Episode 1 Season 1, but were really just gateway videos to … you guessed it … porn.

I immediately related this experience to the resulting aftermath of the Haiti and now Chile earthquakes in which immediately following both disasters, internet sites sprang up which fraudulently offered to take donations on behalf of victims or redirect you to their issue / product of primary concern which was rarely related to the disaster.

A final example of this effect comes from Twitter. In the Twitterverse whenever a meme is created, usually with a hashtag, it is not long after that the griefers and scammers show up. They post their VIAGRA ad with the hottest twitter meme hashtag and destroy the conversation for everyone else.

My panic peaked at this point? How has the internet survived so long in the face of this stuff? Has it just grown to the point where this is now economically feasible? Are we in a new era of the web which looks like the spam-era of email? As part of the work that I’ve been doing on Information Retrieval I was able to consider how powerful the signal from PageRank must be to overcome this: To have been overcoming this for so long.

PageRank, is a technique in which links from one page to another confirm authority on the destination page. The paths that people can take through the Internet by following links therefore reveal a great deal about where the good content is and where the bad content is. The links represent the efforts of human curation on the Internet. Every link that you put on your web page helps PageRank sifts the garbage from the gold.

However, this doesn’t work with real-time information because PageRank is pretty slow. It takes time for people to add those links. It takes time to figure out the shape of the Internet and it takes time to report the results back to Internet searchers. Apparently it takes more than half a season of Glee, because I can only find garbage today.

So PageRank works well for archived data, what can work for real-time data? Maybe social networks can. If you can leverage social networks to immediately vote on the content being created by the real-time web, then perhaps the social network can replace PageRank for ephemeral data. All that remains is a way of figuring out what people think is good or bad in the same way that looking at a link tells you whether people think content is good or bad.

So what started out as a panic that the Internet was about to collapse, really gave me a new appreciation for PageRank. In some ways the link structure of the Internet is the social network that we have been leveraging all along. My panic also made me realize that we need a new signal for real-time ephemeral data – like news and tweets – to sift the good from the bad. My panic has subsided now that I know the shape of the problem a little better. I think the problem is large, but it would be cool to solve it.

Similar Posts:

• Twitter is a Low-Bandwidth Multicast Internet
• Cell-Phone Activity For Predicting Earthquakes
• Local data vs Localized data: When are they the same?
• Using social networks to guide recommendation systems
• Notes from ISWC 2005