How Much Do You Trust Facebook?

The ENIAC, short for Electronic Numerical Integrator Computer, was the first electronic computer…ever.

Originally designed to work for the army, ENIAC was also nicknamed the ‘giant brain’.

It was quick, for its time…

Something that would take mathematicians then 12 hours using a calculator ENIAC could churn out in only 30 seconds.

And ENIAC was also huge, size wise I mean.

According to Wikipedia, the computer occupied about 170 sqm and weighed over 27 tons.

If you have ever seen footage of it, it looks like a bunch of tubes, switches and wires. It needed several people inside the room at the same time to program it by setting switches and wiring cables.

Mathematician Harry Reed, said that working with ENIAC felt like you were in it:

The ENIAC itself, strangely, was a very personal computer. Now we think of a personal computer as one which you carry around with you. The ENIAC was actually one that you kind of lived inside.

Today our lives are more digitalised than ever. Our personal computers are much smaller, they fit in the palms of our hands.

Easy to carry and handle, smartphones allow us to communicate with others and access any information in seconds. There is no need to remember phone numbers, appointments, or even ask for direction.

All the info is there, stored in the cloud to access.

It feels like we live inside the cloud

If anything, today it feels like we live inside the cloud, a place that we are constantly connected to.

Here is how James Bridle described the cloud in New Dark Age, Technology and the End of the Future:

[T]he first criticism of this cloud is that it is a very bad metaphor. The cloud is not weightless, it is not amorphous, it is not invisible, if you know where to look for it. […]It is a physical infrastructure consisting of phone lines, fibre optics, satellites, cables on the ocean floor, and vast warehouses filled with computers[…]

The cloud is a new kind of industry, and a hungry one. The cloud doesn’t just have a shadow; it has a footprint. Absorbed into the cloud are many of the previously weighty edifices of the civic sphere: the places where we shop, bank, socialise, borrow books, and vote. Thus obscured, they are rendered less visible and less amenable to critique, investigation, preservation and regulation.[…]

What evaporates is agency and ownership: most of your emails, photos, status, updates, business documents, library and voting data, health records, credit ratings, likes, memories, experiences, personal preferences and unspoken desires are in the cloud, on someone elses infrastructure.

The cloud is a vast place with few key players.

I was thinking of New Dark Age as Facebook unveiled the details for their new digital currency, Libra, this week. Libra will allow users to send each other money but also to buy things, all without the need of a bank account.

The premise of Libra is that it will be as easy as sending a text or a photo.

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Facebook’s Libra is sure to have a lot of reach

With several large companies backing the project and over 2.3 billion monthly active users, Facebook’s project is sure to have a lot of reach.

With Libra, Facebook is looking at more ways to gain revenue, but also at integrating into more areas of your life, much like we have seen Chinese apps like WeChat do.

Facebook says that Libra’s transactions will be anonymous, that it will not link the transaction to a real person.

Forgive me, but I don’t buy it.

Libra is already running into trouble with governments with the US senate already planning a hearing as it encroaches into their domain.

And Facebook hasn’t exactly been the poster child for privacy.

In particular, I am sceptical because it seems like Facebook could be working on a different definition of privacy that you and I may have.

At the same time Zuckerberg is tooting that he wants to increase privacy in the social network, Facebook lawyers were explaining a court in California that privacy doesn’t exist in Facebook.

This from The Intercept

Representing Facebook before U.S. District Judge Vince Chhabria was Orin Snyder of Gibson Dunn & Crutcher, who claimed that the plaintiffs’ charges of privacy invasion were invalid because Facebook users have no expectation of privacy on Facebook. The simple act of using Facebook, Snyder claimed, negated any user’s expectation of privacy:

‘There is no privacy interest, because by sharing with a hundred friends on a social media platform, which is an affirmative social act to publish, to disclose, to share ostensibly private information with a hundred people, you have just, under centuries of common law, under the judgment of Congress, under the SCA, negated any reasonable expectation of privacy.

An outside party can’t violate what you yourself destroyed, Snyder seemed to suggest. Snyder was emphatic in his description of Facebook as a sort of privacy anti-matter […]So not only is it Facebook’s legal position that you’re not entitled to any expectation of privacy, but it’s your fault that the expectation went poof the moment you started using the site (or at least once you connected with 100 Facebook “friends”).[…]

At one point Chhabria asked, seemingly unable to believe Snyder’s argument himself, “If Facebook promises not to disseminate anything that you send to your hundred friends, and Facebook breaks that promise and disseminates your photographs to a thousand corporations, that would not be a serious privacy invasion?

Snyder didn’t blink: “Facebook does not consider that to be actionable, as a matter of law under California law.”

In other words, once you share something on Facebook it isn’t private anymore.

So, do you still want to trust Facebook with your finances?

Bottom line, if you want privacy, keep it out of Facebook — or any other social platform — for that matter.

The integration of big tech into our lives and the loss of privacy is one of my main interest.

That’s not to say I’m against technology.

On the contrary, I think there are a lot of exciting changes happening in technology that could make our lives better.

But my point is, do we need to rethink our relationship with technology?

I will be following this trend and more in the weekend edition of Rum Rebellion.

Until next weekend.


Selva Freigedo

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Selva Freigedo is a research analyst for The Rum Rebellion.

Born in Argentina, her passion for economic analysis started at a young age. Her father was an economist for the Argentinean governments and the family used to discuss politics and economics at the dinner table.

Argentina is a country with an unusual economic history. Growing up there gave Selva first-hand experience on different economic phenomena such as hyperinflation, devaluation and debt default.

Selva has also lived in Brazil, Spain and the USA.

Back in 2000 she was living in the US as the dot com bubble popped…
And in 2008 she was in Spain as the property market exploded and then collapsed…

She has seen first-hand what happens when bubbles burst.

Selva joined Fat Tail Investment Research’s team in 2016, as an analyst. She now writes from her vantage point in Australia, where she settled in 2015.

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