Dr. Christopher Houghton Budd has created this abridged version of a description of what a solari is and what it can do for us. I thought it was particularly well done. Special thanks to Christopher. – Catherine Austin Fitts
Nice... or Rough?
The Solari Idea
Well known as an investment banker experienced at using financial tools to solve problems, Catherine Austin Fitts has long experience in government and corporate finance. She has responded to the problems she has encountered with the idea of a new-style investment.
This (slightly abridged) item is taken from her website.
A solari is an investment databank and investment advisor for a place - a place being an area that is typically no larger than 10,000 people resident at the time of the solari’s creation.
A solari as investment databank promotes literacy about "how the money works" within its place and - with tools such as investment clubs - promotes higher rates of investment within its place.
A solari circulates annual reports on:
A solari as investment advisor invests in local reengineering and investment transactions that improve equity rates of returns within its place that are profitable and attractive for the solari and its shareholders, including but not limited to:
Market forces determine the number of solaris in a place and their relative market share.
Two Share Types
A solari has two classes of common equity: Solari As and Bs. Solari A voting shareholders - the founders and their self-perpetuating successors - live within the solari’s place and govern the solari. Economic ownership is represented by Solari B non-voting shares, which can access local and global capital, directly or through vehicles managed by the solari. Solari A shareholders make their profits on Solari Bs just like everyone else.
The solari’s equity structure promotes governance by local leadership best qualified to create the highest local equity yields for the benefit of all shareholders - whether management, neighbor or global investor.
A solari’s A/B equity structure provides incentives to reengineer current local investment to significantly higher yields.
Transformation of local investment performance occurs in part by increasing alignment of interests where such alignment enhances equity yields – between various groups locally, between local and global investors, and between human, environmental and financial capital.
The United States was the location for prototyping the solari model and is the basis of describing it here. The solari concept has broad application globally, both in transforming industrialized nations to sustainable economies as well as supporting non-industrialized nations to optimize current resources and create new wealth. Indeed, in many places throughout the world, it is essential to ensure successful privatization and wealth creation in the face of efforts by the industrial nations and G-7 to deplete wealth to subsidize non-sustainable first world populations and lifestyles as well as to centralize political and financial power and resources.
Economic & Financial Literacy
The word "solari" is from the Latin word "sun" and was the name of the currency used in the science fiction series, "Dune."
By promoting literacy about "how the money works" and improvement in investment performance, a solari provides sunshine regarding place-based resource optimization and risks necessary to support wealth creation.
In the U.S. resources have traditionally been managed by two systems. The first is the democratic processes within a republic. Eligible US citizens vote at the polls every year or two to chose representatives who manage resources that are collected by taxing, allocated by distribution of government credit and subsidies and created and enforced through regulatory, legislative and judicial standards and decisions; and the second is the marketplace where consumers and organizations "vote" every day with the investment of time, attention, choice of what small business to start or employment to pursue, and how they use their money in terms of purchases, deposits and investments.
Whether the democratic process related to resource management within a republic or the market process in the economy, both systems require transparency to optimize individual and system-wide intelligence. Citizens require accessible information about "how the money works" to understand their political representatives’ and governmental organizations’ budgets and actions and hold their representatives and themselves accountable for actual performance. Likewise, consumers, entrepreneurs and workers need accessible and low cost information to optimize preferences and self-interest in the marketplace.
Without place-based transparency, government and market allocation of resources in the U.S. has become increasingly manipulated and sub-optimal in terms of economic performance. The deterioration of the rule of law has accelerated, with organized crime rising as a % of economic activity and capital investment. As this happens, total wealth and productivity shrinks from the optimal and concentrates into fewer hands. There is a shift from small business and farming to corporate control and production which is not merited by fundamental economics. Leadership is increasingly determined by performance in capital control and asset shifting rather than wealth creation. The citizenry has experienced deterioration in standards of individual and civic responsibility and accountability.
A decentralized system can only succeed if it is committed to the highest standards of traditional fiduciary performance and wealth creation. In short, in the age-old competition between the forces of centralization and the forces of decentralization, the model that produces the highest learning metabolism and performance in terms of both individual and shared wealth creation has the best chance to win.
Reengineering Yields on all Capital Within a Place
As US national leadership bolstered by NAFTA continues to move - even expropriate - significant amounts of private and public capital and employment abroad and encourage low wage immigration, local U.S. leadership is faced with the challenge of:
In this environment, a solari can use the increased local transparency it creates to enhance equity yields locally.
To name a few:
The speed at which US citizens reengineer their "shared intelligence" and learning speeds locally will determine the extent to which the US is able to avoid the economic dilution and/or demodernization and depopulation experienced by Russia, Argentina and other areas of the world that have experienced an implosion of the rule of law8 and the resulting "continuous consolidation of money and power into higher, tighter and ‘righter’ hands."
As Tina Turner once sang, "We can do this nice – or rough."
An entrepreneurial way to say ‘nice’ is that a network of solaris is the infrastructure needed to exploit the reengineering opportunity to transform the United States to a sustainable economy. Privatization, globalization, securitization, and digital technology -these are trains that have left the station. If we rethink traditional alignments and reinvent how we support our resource governance on a decentralized basis we can engage traditional market forces and fiduciary principles to create substantial new wealth around optimal care of the land, of each other and of ourselves.
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