Reflection, Unanswered Questions and Goals for Financial System Transformation


Today marks five years since the start of Conversations with Kip Vlog. In celebration, I’m releasing two videos, one is a bit in the tradition of the bloopers of the past, showing that at times I don’t have the answers. The second is more serious, discussing the importance of reflection.

First, consider that at times we don’t know everything we would like to about the problem we are trying to solve. This is Episode 251 of Conversations with Kip, the best financial system vlog there is.


In this second episode, let’s reflect upon reflection. Consider the following when thinking about the importance of reflection in helping us meet deadlines and goals.

A few years ago I was in York, England, and my hotel room looked out over York Castle. I wasn’t sure how long it had taken to construct, but my hotel room on perhaps the 4 or 5th floor looked down on the castle, and I was certain that the hotel had been built in significantly less time than it had taken the castle to be built centuries ago.

York Castle, York England

I asked myself what would have changed to make that possible?

The simple answer is knowledge. More knowledge of the laws of physics and other things allowed the people who built my hotel to use fossil fuels and other forms of energy to power machinery to do much greater amounts of work in much shorter times than was possible when building the castle.

I have used this thought quite frequently when I felt overwhelmed by the work required to achieve some goal by the appointed deadline. Instead of rushing to do all the steps I thought were necessary, a few moments of thinking, of pondering, of reflecting, at times reveals a new insight. Quite frequently those new insights obviates large amounts of activity I thought was necessary to achieve the goal.

This is Episode 252 of Conversations with Kip, the best financial system vlog there is.


Often in my blog, I talk about balances, verses transactions. Balances present information giving a current state of things. They are very efficient. In 2019 I learned that reflecting is, in a sense, like the process of creating balances.

Daniel Boorstin in his book “The Discovers” in a section about history and wider knowledge growth, begins with how important memory was to the ancients; how much they focused on memorizing; that professional, medical, historical, relationships, all were dependent upon memorization.  People spent their lives practicing how to remember, using tricks of walking through spaces and associating images with ideas to put them order and retain them. 

We don’t do that at all any more.  Recorded material allowed us to stop doing that. 

In the practical use of our intellect, forgetting is as important a function as recollecting….If we remembered everything, we should on most occasions be as ill off as if we remembered nothing. It would take as long for us to recall a space of time as it took the original time to elapse, and we should never get ahead with our thinking. All recollected times undergo, accordingly, what M. Ribot calls foreshortening; and this foreshortening is due to the omission of an enormous number of the facts which filled them.

“…We thus reach the paradoxical result that one condition of remembering is that we should forget. Without totally forgetting a prodigious number of states of consciousness, and momentarily forgetting a large number, we could not remember at all….” (“The Principles of Psychology” William James (1890))

Daniel Boorstin, “The Discovers”, page 718

The Impact of Conversations with Kip

I will be honest in my assessment of Conversations with Kip; although there is consistent viewing of my videos, and some learning that goes along with what I have tried to teach, I’m disappointed there is not more. More interaction, more debate, more learning, more insights.

Sterling W. Sill in his speech “Bottles and Books” in 1977 said

…And what a thrilling possibility it is that I can run through my little weak brain every idea, so far as it has been recorded, that was ever run through the brain of the greatest thinker that America has ever produced! I can also run through my mind the greatest moral and cultural stimulants from the prophets, the statesmen, the poets, the playwrights, and the philosophers.

We can live with Abraham; or we can go up onto the Mount of Transfiguration with Jesus as he was transfigured and appeared in shining garments talking with Moses and Elias before Peter, James, and John. We can have all of these great experiences out of the past and bring them down and put them right on the piston head to produce for us the inspiration of a good life lived at its best.

William James, the great Harvard psychologist, once asked this question: “How would you like to create your own mind?” And isn’t that exactly what each of us does? Professor James said the mind is made up by what it feeds upon. He said the mind, like the dyer’s hand, is colored by what it holds. If I hold in my hand a spongeful of purple dye, my hand becomes purple. But if I hold in my mind great ideas of righteousness and faith and devotion to God, my whole personality is colored accordingly.

“Bottles and Books” 1977 BYU Devotional

It may not be necessary to learn all that I have learned in the same way I learned it, in order to make it useful. But I feel the world has lost knowledge about measurement, and how our systems measure. Unless that knowledge is renewed and expanded, we will not solve greater problems.

Vision for a New Financial World

I recently wrote the following as a statement of the broadest vision of how the world’s financial systems might change to solve some of the most intractable problems there are.


To bring 1 billion people into the digital economy, not just through transaction payments and receipts, but also with financial management capabilities that allow them to measure what they do well, what they don’t do well, how to contribute to society better, and how to prepare for the future.

The types of tools by which this will be done are all effectively known today:

  • Inexpensive cell phones which are the personal computers even for the world’s poorest
  • Internet mobile technology services, similar to Facebook, Google, Twitter, and Amazon
  • Mobile payment and receipt systems, like Venmo
  • Ubiquitous financial tracking databases, like available with blockchain


The impediment to this capability today is the fragmented and proprietary nature today’s financial systems and data. 

  • Financial data is maintained in many places in propriety forms by various intermediaries who provide little help to individuals in financial management
  • Management of financial data is tedious, low in automation, and requires specialized knowledge
  • Categorization of financial data, which is key to understanding finances over time, is a clean-up activity, post authorization rather than captured at transaction time (i.e., payment or receipt)
  • Reconciliation with counterparty ledgers (bank, vendors, customers) consumes large amounts of resources if even attempted.


Sharing financial data with authorized counter- and interested parties has the greatest potential to overcome these impediments. Sharing financial data:

  • Potentially significantly reduces costs to each party because actions taken by one are shared by the other
  • Increases accuracy of the resulting ledgers because of the natural check a counterparty brings to the data
  • Demands that financial data be moved from propriety locations and increases ownership by primary partners
  • Eliminates the need for reconciliation and other wasted processes, and increases expertise in financial management by leveraging knowledge of others in it.


Cost is critical to such a system, particularly for widespread use by those most in need of the system. 

  • Financial data is most effective when it is very accurate over long periods, a very demanding data standard
  • Reductions in computing costs must not be wasted on inefficient, sloppy code but rather increase accessibility to new customers
  • System efficiencies cannot be added later; performance at scale must be embedded from the start
  • To reach a billion people requires reductions in costs from todays system by hundreds or thousands of times.


Computer processes have increased efficiencies when they have increased consistencies and identifying fundamental data organizations is key to those. Recently developed ubiquitous internet technologies demonstrate the power of such a concept. 

  • Search engines are fundamentally organized around URLs
  • Social media are organized around posts
  • On-line retailers are organized around products or SKUs
  • The fundamental data organization for any financial system is composed of a set of balances, which reflect positions as of a point in time, and the full set of transactions which gave rise to those balances. 


With a system organized around such data, users will be able to:

  • Swipe right or left to scroll through a set of balances over time
  • See transactions which changed balances in those periods
  • Initiate new transactions based upon those balances
  • Aggregate balances to create higher level understandings over time or other attributes, to understand their financial world enabled because of the consistency of the balances and transactions.


Because financial processes are so costly, they were perhaps the first major system automated with the advent of computers. This infrastructure is now an impediment to the next generation of systems. The new system and its processes:

  • Will differ from search engines, social media, and on-line retailers built in green fields in a sense
  • Supporting individual’s needs will also support an organization’s needs if scale is built into the system
  • Will likely develop first for business and then be simplified for mass use
  • Are unlikely to come from existing technology vendors or industries like financial services, just like airlines were not invented by the railroads, nor on-line retailers by brick and mortar stores.


As Tony Venezia, a very seasoned financial system expert one time said after considering the above, “There is no other possible course.” The type of system described here will ultimately be made. When is the question. Collaboration to overcome the current system impediments will hasten that time, to the benefit of billions of people.

I am expanding my collaborative environment at I encourage you to join me in achieving these goals.

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