The current financial system has reached the limits of its effectiveness. Interest on debt has exceeded the system’s ability to pay it off. But debt is simply a promissory note on future productivity – any caveman can tell us that the only way to increase productivity today is to innovate yesterday, not tomorrow.

In modern times, this means that the only way to sustainably create more money tomorrow is to innovate today. This is the tiny little flaw of Wall Street that Innovation Economics will correct.

http://www.ingenesist.com describes a few simple web applications that will allow human knowledge to become tangible outside of the organizational construct of a corporation, government, or even academia. Whoever develops these applications will generate a great deal of wealth.

These applications are as follows:

1. The knowledge Inventory
2. The Percentile Search Engine
3. The Innovation Bank

Believe it or not, human knowledge would make a wonderfully tangible asset upon which to peg a currency – better than Gold, Silver, Oil, or Debt.

While this may not seem like a much, the reality is that everything changes. Many of our most durable paradigms will be challenged and millions of new business models will be created while nearly every existing business will be made more efficient. Wall street will be transformed from master to steward.

by analogy, in a demonstration for the US Congress, Eli Whitney took 10 working muskets and disassembled them, scrambled the parts, and reassembled 10 working muskets. This seems trivial to us today, but at the time it astonished the world and led to a completely different approach in the segmenting of assets, it led to the industrial revolution and ushered in waves upon waves of innovation including but not limited to todays computer enabled economies.

The treatment of knowledge assets in social networks is on the verge of inducing the same degree of transformation. Hold on to your hats kids – it’s going to be a wild ride.