Thursday 20 June 2019

Libra: at last, used notes in a plain brown envelope with a stable exchange rate

Digital Currency is almost as good as paying with used notes in a plain brown envelope Mark Zuckerberg, surely one of the most immediately recognisable faces on the whole of the internet, has announced that his company, Facebook, one of the most instantly recognisable wastes of time on the whole of the internet, is going to send forth a new digital currency, and its name shall be called Libra.

Digital currencies have been around for some years, so Mr Zuckerberg has taken the opportunity to learn by its predecessors’ mistakes. One of the advantages that Libra will have over the established brands will be that it will have a stable exchange rate, unlike Bitcoin, for example. Because there are not a lot of Bitcoins in circulation — only 21 million will ever be ‘mined’ — the exchange rate of Bitcoin has swung wildly, which makes it, incidentally, a good choice for currency speculators. The value of the Libra will be pegged to the value of a ‘basket of currencies,’ which may well be a reference to the IMF Special Drawing Right (XDR). If it is, then Libra will join the handful of currencies pegged to the XDR, which include the Seychelles rupee and the Syrian pound. The XDR has proved fairly stable, so the Libra, linked to the XDR, would likely be fairly stable too.

Compare the foreign exchange market:

    
The value of a Bitcoin has wobbled between £205 on 1 January 2015 and £14,380 on 18 December 2017. It is currently (20 June 2019) £7,496 Compared with Bitcoin, the XDR has proved fairly stable. (Note: the vertical scales of the two graphs are different.) In the last five years it reached a low point of 88p on 7 July 2014 and a high point of £1·13 on 17 October 2016. Currently it’s £1·10

If it can fulfil one of its design objectives and “make it as easy to send money as it is to send a text message,” Libra will likely be heavily used and a great success. If it achieves a stable exchange rate, the chance of finding that the money in your digital wallet or handbag has suddenly disappeared will be negligible. On the other hand, of course, your chances of finding that the few pence that you used to have in your digital wallet is suddenly worth countless millions of pounds will also be negligible. (Left: A 10,000 SDR banknote, worth about £11,000 in June 2020)

Thus, easy to use and stable in value, Libra may well have found a way around the best known disadvantages of digital currencies.

What of the best known advantage, the anonymity of digital currencies?

The desire for anonymity when paying money is not, of itself, a sinister thing. We all use cash, at least occasionally, and when we spend cash, we usually do so without leaving any record of who we are, when we made the payment, or what we bought. Going through the takings of a newsboy, an ice cream salesman or a bus conductor, we know only what amount was taken and (where there are tickets or receipts) how many transactions took place and the amount spent in each one. It is the desire to remove anonymity that is sinister, not the fact of it, and that may well be the motive behind the peculiar move to abolish coins and notes outright.

Digital currencies can be anonymous, like cash. That means that no information is passed from your plastic card, the merchant’s card reader or your card issuer that link your payments to you. Of course, there might be other means of linking you to your payments and purchases: for instance, if the merchant has a closed circuit television camera filming you as you use your plastic card. In principle, though, digital currency should pay the amounts that you want to pay but leave no trace of who paid them or what they paid for. Not that anonymous payments guarantee success to a digital currency. The digital currency E-Gold, whose design offered the card-holder complete anonymity, failed. Its use by criminals led, on 20 January 2015, to the suspension of E-gold transactions and, later, to the closure of the company.

So anonymity is really nothing that hasn't been going on for centuries and nothing to be scared of. The point that I haven’t heard anyone make, though, is that a conventional credit card or debit card could be used anonymously, but isn’t. If the pattern of messages between the card reading terminal, the card company and the payee’s accounts department were designed to make the payment anonymously, there would be no reason to open a separate account with a special anonymous payment card issued by a company every bit as dodgy as a two-year-old prawn sandwich.

Here’s one way of setting up the card reader and its contacts in the card company and the payee’s company so that you can pay a bill anonymously with an ordinary credit or debit card. At each stage, information is transferred only concerning the payment card and the value of the purchase. No information concerning the identity of the purchaser is given to the merchant.


Here’s another way of achieving the same thing. This way takes the load off the card reader and puts the onus of communicating with the merchant onto the data centre, which is usually a lot better equipped to provide it.


Since it isn't particularly difficult to design a card reader that accepts ordinary bank cards but processes them anonymously, might we hope that, at some time in the not too distant future, the High Street banks might offer anonymous payments with the ordinary credit and debit cards that everybody already has? I wish Libra every success in its enterprise but many of us need no more than a small enhancement to the plastic card services that we already have.

Incidentally the European Union is trying to kill off anonymous digital currencies because they think anonymous payments encourage terrorism. While that’s indubitably true, before they put an end to one of the most useful developments in information technology since the first archer tied a message to an arrow and shot it at a tree overlooking the Merry Men in the Forest, the European Union should first try insisting that companies who make and sell hand grenades, land-mines, machine guns and nuclear missiles should record the details of the people they sell them to and hand the record to the local Police at the end of every week’s business.

Notes. The design of the coin at the top of this page is based on two separate images, each of which are speculation in the Press rather than data from Facebook or Libra, so don’t waste your time trying to forge one. The One Libra banknote is of my own design.

Exchange rates and graphs are from XE Corporation.

Tuesday 11 June 2019

Come to sunny Scotland!

Come to sunny Scotland! You don’t remember the days when Scotland was considered a holiday destination every bit as good as Magaluf and the Costa del Sol are now. This poster dates from about 1935.


Today, for one day only I expect, those days have returned. Look at today’s weather map.


Here is a picture of what I can see out of my kitchen window today:


Here is what I would be able to see out of my kitchen window if I lived in England:


It isn't often that you get the chance to say Come to sunny Scotland!

12 June 2016, 4.30 pm Today is a chilly day here. There has been no sunshine, and the rain began around mid-day. The bright and sunny weather was, clearly, sent to us only for one day.

The picture of a flooded street is from the Mail Online.

Saturday 1 June 2019

Fantasy Engineering: Euston to Canary Wharf

Fantasy Engineering: Euston to Canary Wharf

This imaginary project improves the public transport route between Euston and Canary Wharf. The route is already well served by public transport. Travelling on Underground trains, you complete the journey in half an hour at a speed of 11 mph. For comparison, the award-winning buses in my home town, Edinburgh, average 7 mph. The trams are a bit faster, at an average 14½ mph.

Therefore a new route needs to have some desirable feature which the present public transport routes do not offer, and it also has to be fast enough to compete with an electric underground railway.

The proposed new route satisfies these requirements by combining a non-stop route to the north bank of the River Thames with an express ferry. The resulting hybrid route is fast enough to be competitive and useful, and the ride on water is an attractive feature and a sort of saleable by-product for the ‘business tourism’ market.

Background

On 11 April, the magazine New Civil Engineer published an article by Katherine Smale titled Exclusive, Canary Wharf Group in talks about rail link to Euston stating that the government is considering having a new express Tube line built from, as the title implies, Euston to Canary Wharf.

On 17 April, the Web site City Metric published a related article, Could London get a new tube line from Canary Wharf to Euston?. The author, Jonn Elledge, asks what route the line might take, and in particular whether the proposed line should take a route mainly through North London or through South London. Here are the two routes which Elledge considers, as well as a straight route which I use for comparisons. (The ikon means that the link opens in a new window. The ikon means that there is a foot-note.)

Northern route through Shoreditch
 

Southern Route through Southwark

Straight line route including King’s Cross

The distance by rail from Euston to Canary Wharf is at present 5 miles 48 chains, and it takes thirty minutes on the London Underground, changing at Tottenham Court Road and Bank. That gives an average speed just over 11 mph, which is not bad for public transport in a highly congested city. Travelling in a straight line with one station at King's Cross, an Underground train would cover the distance of 5 mi 27 ch from Euston to Canary Wharf in 14¼ minutes. Its average speed over the straight line route would be 22½ mph. 1

While the choice of route is obviously important to engineers, Underground train drivers and people who like drawing lines on maps, passengers care little about the route which the train takes, since they can’t see anything out of the windows. The proposed hybrid service is reasonably quick and more interesting to the jaded international businessman than an underground tunnel running the whole distance. London is, after all, one of the world’s greatest cities and the least the government can do is to show it off to travellers from lesser places who might never see any of London otherwise. The proposed service also complies with Transport for London’s River Action Plan, published in 2013, which aims to double the number of people travelling by river, its target being 12M commuter and tourist trips every year.

The existence of wharves at Embankment and Canary Wharf and a navigable waterway linking the two suggests that the government ought, for at least five minutes, to consider planning a route via Embankment Pier. Passengers travel from Euston to Canary Wharf by Underground as far as Embankment Pier and by riverboat from Embankment Pier to Canary Wharf. It would make sense to pay the small additional cost involved in including King’s Cross and St Pancras stations in the scheme, since they are important arrival points for business passengers coming from Scotland, the north of England and the continent.

Euston to Embankment

From Euston to Embankment Pier, on the Thames, is barely two miles. The Northern Line already runs from Euston to Embankment. We have three choices: (a) use the Northern Line as it is, or (b) build bypasses around the intermediate stations on the Northern Line so that express trains can go past them without stopping, or (c) build a new underground line from King’s Cross and Euston to Embankment Pier. A railway tunnel from Euston to Embankment Pier would cost about £630M, from King’s Cross £850M. 2

The Northern Line does not at present provide a direct link from King’s Cross to Euston. Using the Northern Line as it is will make the journey from King’s Cross to Embankment inconvenient since it will involve changing trains at Euston.

And at this point in the story, we can have fun drawing lines on maps. 3


    
A service from King’s Cross to Embankment via Euston requires a change at Euston.

We can create a faster service from King’s Cross via Euston by constructing a short link from one branch of the Northern Line to the other.
The creation of that link complicates the operating pattern of the Northern Line, which is already quite complicated.

This is the present operating pattern. Trains leave both King’s Cross and Euston for four different destinations. (Five if you count Kennington, where some southbound trains terminate.)

With a direct link from King’s Cross to Euston, trains leave both King’s Cross and Euston for five different destinations, or six if you count Kennington.

This is the schematic diagram of the express service from King’s Cross and Euston to Embankment Pier, showing interchanges with other Underground lines and the ferry service to Canary Wharf.


4
We have now reached Embankment Pier.

A train from Euston to Embankment must pass through five intermediate stations. Stopping trains will delay the express service unless action is taken to prevent the delay.

An express route, which requires the excavation of about two miles of tunnel, is one possibility. Another is the creation of by-passes so that trains on the Canary Wharf express service can pass through the stations without stopping while stopping trains still call at the platforms. Note that the existing tracks are used for the express trains so that they do not have to decelerate to run over the turnouts safely. Stopping trains slow down and use the turnouts.


At some stations it will be possible to provide bay platforms for stopping trains, and non-stop trains will use the existing tracks. The existing platforms will be retained for such uses as emergency evacuations, access to track, or bomb shelters. A detailed survey of underground objects will be required to determine where this type of by-pass can be built. This type of by-pass can be used even when the running lines are vertically separated.

Left hand rule of road
Where the running lines are horizontally separated by 60 ft or thereabouts, and they are not vertically separated, the bay roads can be built between the running lines. This results in lower cost, but passengers dislike island platforms.

At the terminal of the express service, a bay platform needs to be provided so that trains operating the express service have time to lay over and for the driver to change ends.


Although Embankment Station on the Northern Line is close to Embankment Wharf, it might be possible to provide quicker transfer from the Underground train to the ferry by building a station immediately beside the wharf on the lines of a marine station, like this.
The route map of the riverboat link between Embankment Pier and Canary Wharf runs along a fairly straight segment of the River Thames. It is 5 mi 10 ch in length, which takes 10½ minutes.

No new piers need to be built although Embankment Pier could be adapted to offer fast rail to ship transfer.

Catamaran riverboats of the type most recently acquired for passenger service on the Thames, operated by Thames Clippers, are Incat catamarans 35 ft 10 in long, 27 ft 3 in beam and capable of carrying 150 passengers at a speed of 25 kn. Each riverboat requires three or four crew.

The cost of a riverboat is expected to be about £3¼M. 5

It is expected that three riverboats would be sufficient to provide a service every ten minutes.

Notes

1. Timings for the Underground are taken from the published timetable. Timings for the Thames ferries are taken from the MBNA Thames Clippers published timetable. Speed of Edinburgh Trams are calculated from data in Wikipedia and Edinburgh Trams timetable.

2. Costs. I used the figure £315M per mile to estimate the cost of tunneling. The figure is taken from a light rail project in Toronto, converted to British Pounds at the inter-bank exchange rate. It is regarded as high by people who know more about tunnels than I do. For a consideration of costs of urban railway in tunnel please refer to Are Tunnels for Light Rail really cost prohibitive? by Klaus Philipsen.

3. Mole. The cartoon drawing of a mole is adapted from the winning entry of a competition held in 1971 to find a logo for the Helsinki Metro.

4. Maps from Google Maps. Ferryboat drawings from First Ferries.

5. Ferry boats. Capital cost from Thames Clippers website. Mechanical and performance data taken from Shipping Today & Yesterday website.