Ok, who has their feet most firmly on the ground?
Town &
Country Planning, October 1999
Being the kind of person who hangs around
peculiar ideas and reads unusual and forward-thinking
magazines like T&CP, I am occasionally accused of
being idealistic. I tend to get this from people who have
their feet on the ground, people who feel I don't have as
clear a grasp on reality as they might like. So the recent
explosion of internet stocks has been a godsend for people
like me.
Not because I've got any money invested in them, I hasten to add, but because of how they help me in arguments at dinner parties.
After all, we now live in a world where a website like Yahoo can be worth more than British Airways, and where a loss-making small department of Dixons called Freeserve can be floated on the stock market and end up worth £2 billion. And in a world where 20-somethings in Silicon Valley are selling out their tiny loss-making internet ventures for a billion dollars or more, then reality is not what it was.
I mention all this because of the serious implications for most parts of the world which don't happen to be Manhattan on San Jose. It used to be that some pockets of most developed countries had been bypassed by the flow of money. And if you read the extraordinary surveys of London carried out by the shipping magnate Charles Booth exactly a century ago, you find that many of those pockets are the same places as they are today &emdash; give or take Chelsea and Notting Hill.
But we may now have to face up to the possibility that the world is reversing itself. There will be a few fabulously wealthy pockets, and the rest of us will have to make do with something else. Every time I watch the financial news these days, I can hear a sucking noise as the money flows exit themselves from most places on the globe and dash after the airy-fairy loss-making internet stocks. And having done that, they whizz offshore, to join at least one sixth of the world's wealth.
No doubt my predecessors might have written the same things before the South Sea Bubble if this magazine was publishing back to the 1720s (it wasn't), after which the world would right itself and reality would brush itself down and settle into its favourite armchair. But this time, I'm not so sure &emdash; though there may well be some uncomfortable stock market corrections.
Either way, we are going to have to get to grips with the basic problem of cities once again. Lots of people with time on their hands and skills, lots of things that need doing, but the money is off sunning itself under the internet stocks. The faster we work out ways of issuing our own money to bring those two sides together locally, the safer we will all be.
And paradoxically, that process looks like being brought forward by the internet. I am opening myself an account with beenz.com, the new internet money &emdash; but I could equally well be using many of the other internet currencies on offer from iPoints to CyberCash. And if they can create their own money by computer, so can Liverpool and Crystal Palace.
If there's anyone out there who doubts the frightening effects of internet stocks on the world of ordinary people like you and me, take a look in recent issues of the investors magazine Fortune, with its scary stories of buying a house in over-heated California.
Because of all these new internet billionaires, San Francisco house prices are probably rising faster than anywhere else in the world &emdash; which puts enormous power into the hands of the sellers. And that means the vast majority of people can't buy a house at all.
But if you can afford it, here are some of the things the local estate agents advise you to do:
- Offer the vendors the chance to stay living in the house after you've bought it for six months rent free.
- When you go round and view the house, take them some home-made cookies.
- Add in a clause to your offer which promises to bid 10 per cent above any other offer they receive &emdash; and clip personal photos of yourself to the bid.
- Get your children to write the vendors cute letters about how much they would like to live there.
So, I put it to you &emdash; who has their feet most on the ground these days? People with unusual new ideas about local currencies, or what Keynes called the 'plain men' who think that the current global market provides some measure of reality?
David Boyle is an associate of the New Economics Foundation and the author of Funny Money (www.funny-money.co.uk)
