On the one hand, this development is a milestone triumph of digital efficiency and convenience, something I greatly appreciate. On the other hand, I — and it seems many others — can’t seem to muster the schadenfreude over the demise of a bookstore. Doesn’t seem right, but why?

A digression. What exactly do retail stores sell? They sell objects of value. Some objects have value only in their physical form — food, clothes, utensils, machines, wood, whatever. Then there are objects that derive value primarily from the intellectual property embodied, the physical form being but a representation — books, newspapers, magazines, music, movies, even toys. Retail stores that sell the first class of objects haven’t gone out of business even now. There is some convenience to shopping online but there is still need to “check out” the object in question and take delivery of it, so the retail store isn’t superseded; some stores just made the retail locations a bona fide delivery point; over all the transition was incremental. Initially, retail stores that sell physical embodiments of intellectual property followed the same path. But then, purely digital devices happened — mp3 players, phones, e-readers, tablets — and the physical embodiment got stripped from the latter class of objects like chaff. I think it was this step that made the huge difference. Now what is sold is a digital object — in other words, the object sold got swapped out; the physical store became superfluous if you were only after the intellectual property, because it sold something else, and the differences in cost of delivery made physical stores untenable.

Back to why bookstores closing doesn’t feel great. Could it be nostalgia for the old fashioned paper form-factor? I’ve always felt that e-readers just aren’t that great yet, not a replacement of a book from many perspectives, except on the question of weight and volume. But this is minor. Then what about the next question, does a physical bookstore mean anything more than a warehouse of paper? The answer is affirmative. A bookstore, like a library, takes on the role of a commons.

If not enough people buy paper books, bookstores will close down, and that’s a shared loss. Whereas before, people pooled for a common good by paying more for paper books, now, for each person’s convenience, there will be something less for everyone. I don’t think this is the desired outcome. A lot of the conversion to electronic and digital forms is really a conversion to a more personal living style. Nowadays there is still the supermarket and coffee shops where you must get your objects in physical form, but imagine a day when none of these are necessary, when all objects have been digitized, Second Life style. Then there would be no physical stores for anything, and no need to physically be anywhere or interact. This social withdrawal is a profound yet perverse aspect of digitization, long predicted to happen, but the first steps of which we are seeing now. Is Google+ or Facebook going to be adequate replacement to glue people together? (If so, they had better get their “entire social experience” model right.)

Later I realized this was a stupid way of explaining it (or I was just stupid at the time). Capital isn’t a “thing”, it isn’t the physical object at all, it is the usage. Whether something is capital is completely determined by intention, that is, how it is intended to be used, hence the vague definition.

For example a $100 bill, depending on how it is used, can be a consumptive good, a store of value, or capital. If you burn the paper money as offering to the gods, it is a consumptive good. If you keep it under the mattress to buy stuff later, it is a store of value. If you invest it by putting it to use in a productive venture or lending it to somebody whom you expect to do so, then it becomes capital. It’s the same $100 bill, the only difference is intention…

By the way, if the person you lend the $100 to as capital burns it as offering to the gods instead, then you might feel as if you could have enjoyed such frivolous consumption yourself. I’m sure many a bondholder of previously AAA-rated companies feel that way right now, haha…