Automated Clearing House (ACH) (Looking at the Swamp)

What a Clearing House is and what it does in relation to a revolving fund is getting more of my attention and therefore deserves more of my attention.

The Digital Dollar system I propose is a real time public commons clearing house.

Automated Clearing House is described here:

http://en.wikipedia.org/wiki/Automated_Clearing_House

An ACH appears to be encompassing the credit card business with a much broader domain that includes frequent periodic monetary transactions beyond the normal buying and selling that is the domain of the credit card.

Consolidation to a more centralized private business Clearing House is obviously the evolutionary trend that is going in the trend direction of a Public Commons Clearing house.

From the preceding link:

In 2011, this network processed an estimated 20.2 billion ACH transactions with a total value of $33.91 trillion.^[1] Credit card payments are handled by separate networks.

That is  lot of money!  Our National Debt and Gross Domestic Product GDP are both about the same at 16 trillion Dollars.  My conclusion is that (almost) 34 trillion dollars processed is double counting (one debit and one credit for the same transaction) or there is a whole lot of stuff that people are buying that is not in the GDP total.  How could that be when GDP is more or less equal to Gross Domestic Income, which is the money we have to spend to buy the stuff produced.  It amazes me how big money numbers fail to make sense.  There is an explanation, I am sure.

NACHA is described here:

http://en.wikipedia.org/wiki/NACHA_%E2%80%93_The_Electronic_Payments_Association

NACHA (previously the National Automated Clearing House Association) manages the development, administration, and governance of the ACH Network, the backbone for the electronic movement of money and data in the United States. It is funded by the financial institutions it governs. The ACH Network serves as a network for direct consumer, business, and government payments, and annually facilitates billions of payments such as Direct Deposit and Direct Payment. Utilized by all types of financial institutions, the ACH Network is governed by the NACHA Operating Rules, a set of rules that guide risk management and create certainty for all participants.

CHIPS is another big player in the Clearing House business:

http://en.wikipedia.org/wiki/Clearing_House_Interbank_Payments_System

The Clearing House Interbank Payments System (CHIPS) is the main privately held clearing house for large-value transactions in the United States, settling well over US$1 trillion a day in around 250,000 interbank payments. Together with the Fedwire Funds Service (which is operated by the Federal Reserve Banks), CHIPS forms the primary U.S. network for large-value domestic and international USD payments (where it has a market share of around 96%). CHIPS transfers are governed by Article 4A of Uniform Commercial Code.

FEDWIRE  is a Clearing House System that operates somehow in conjuction with CHIPS

http://en.wikipedia.org/wiki/Fedwire

Formally known as the Federal Reserve Wire Network, Fedwire is a real-time gross settlement funds transfer system operated by the United States Federal Reserve Banks that enables financial institutions to electronically transfer funds between its more than 9,289 participants (as of March 19, 2009).^[1] In conjunction with the privately held Clearing House Interbank Payments System (CHIPS), Fedwire is the primary United States network for large-value or time-critical domestic and international payments, and it is designed to be highly resilient and redundant. The average daily value of transfers over the Fedwire Funds Service in 2007 was approximately $2.7 trillion, and the daily average number of payments was about 537,000.^[2] 2009 figures show a value of 631 trillion dollars in transfers originated in Fedwire.

Get a load of this from the above:  It processes an average daily value of 2.7 trillion dollars.

Once again, National Debt and annual GDP and Income are all about 16 trillion.

What is going on?  What is being bought and sold?  This must be the near money, funny money dream up things with dollar value (but are not M2 dollars) market!  They are not playing with real money are they?  What monopoly money are they trading with?

Bottom line is that there is more action in the money clearing business than I can even imagine.  Clearing is a money turnover function, not how much money is in the total system.  However, the numbers are astounding!

"2009 figures show a value of 631 trillion dollars in transfers originated in Fedwire."

CAN I EVER HOPE TO UNDERSTAND MONEY?

I need a new categories for classifying my blog titles:  Looking at the Swamp and Looking at the Alligators.  Categories where I do nothing about either one.  Just look at them and try to figure them out.