Barter Thread (( I am giving this some exposure on the Main section, before returning it to GEI-N))
=============

That is a very interesting concept - wherein lies a big business opportunity maybe?

■ $6.5 billion transacted each year in commercial barter industry.
■ It is estimated that more than 250,000 businesses actively use barter exchanges.
■ The barter industry is growing at approximately 8% per year (& may accelerate in a recession)
■ Joining an barter network is also a way of advertising products, paying less in "soft" currency
■ The number of barter postings on Craigslist climbed from 90,580 in October 2007 to 157,293 in October 2008,

(Two Public bartering companies)
International Monetary Systems (INLM:ob) - New Berlin, Wisconsin: ... update : Daily-1 year
Offices in at least 6 U.S. and 2 Canadian cities. Owns the Continental Trade Exchange barter network.


International Trade Exchange (ITEX:ob) - Sacramento, California: ... update : Daily-1 year
About 100 Broker Offices throughout the US and Canada. ITEX acquired BXI in 2005.



About BARTER :

Ancient Barter was man’s first form of commerce and consisted of the one to one direct exchange of goods and services.
Advances in technology have greatly expanded and enhanced the scope of Barter far beyond this limited one to one model.

Businesses join barter networks, and agree to sell their products thru the network in exchange for the network's "currency".
They can then use the currency to buy other products or services offered by network members.

Joining an effective network is a great way to advertise a company's product, since companies on the network will be looking
for new ways to utilise the currency they have acquired through prior transactions. In a recession, where sales are falling,
many companies may be encouraged to join, as an additional way of disposing of excess product or service capacity.

Many networks use electronic currencies, and/or smart cards.

This thread will be looking at some of the larger bartering networks, including IMS, a publicly-quoted group of networks.

==

Description : this interview with CEO of IMS-Barter explains how the Barter program operates:
Barter is Good for Business!
http://uk.youtube.com/watch?v=vUOgAWwmfdg
... it's a decent simple description of the process

The key thing:
Creating a community that has goods and services that they want to trade with each other.
And an easy mechanism of exchange (a currency) and a marketplace.

Bartering - has been spurred on by the recession (people need customers!)
The New Age Of Bartering
http://uk.youtube.com/watch?v=kGMtyCX_DPY

IMS is an OTC-listed company, which is consolidating Barter networks
IMS Barter - Business Barter Better
http://uk.youtube.com/watch?v=kQkGPie9OJk

ClothingSwap is used by women in the US to exchange unwanted clothing
Others: Freecycle, SwapTree ...
http://uk.youtube.com/watch?v=Af7SR4chaTw

Might this work for some people on GEI ???

= = = = =
LINKS:
Barter News .... : http://www.barternews.com/visitor.htm : Weekly Story
Barter Index ... : http://projects.exeter.ac.uk/RDavies/arian/barter.html
How to Barter... : http://www.u-exchange.com/uexchange/?name=barter101
King of Barter... : http://www.kingofbarter.com/
Barter Cheques. : http://www.tradewindexchange.com/currency.html
IRS Taxation.... : http://money.howstuffworks.com/bartering4.htm
IMS Members... : http://www.imsbarter.com/member-spotlights
Businesses....... : BNI : Restaurants#1 : Restaurants#2 :

After listening to the Fitts podcast, I start to think...

BARTER may be a way of getting around the huge skim collected by:

+ Government thru various taxes,
+ Banks thru their various transaction costs

And she also asks the question:

WHERE CAN I BANK that is safe?
She suggests: locally, with small banks, in "healthy places"

You want to be in a place "that is run in an adult manner"

== ==

Some Principles from Fitts
==========

1) The value of the (global) corporate brand is diminishing- trust is diminishing fast
2) Networks of trust will be created in new ways, different from global advertising
3) A shift of purchasing to essential goods and services
4) Traditional businesses will fight the loss of business to barter
5) How do we immunise business from corporate fraud?

SUBJECTS covered at the recent IRTA conference

The Seminars were exceptional at this years Convention.

All of the seminars were created written and presented by IRTA Members in the spirit of sharing information with others. Thanks to each of them for taking their time to provide well attended educational entertaining and informative presentations for the benefit of all attendees.

+ Community Currency and Sustainable Businesses was presented by Annette Briggs.
+ International Modern Trade and Barter chaired by Reiner Husemann
+ Sales Techniques moderated by Ron Whitney and Gary Field.
+ Media and Swipe Card Technology speaker Kent Strong.
+ Trade Brokering using Project Management presented by David Wallach and Sally Selbman.
+ Certified Trade Broker Training provided by Steve Acerra
+ IRS and TIN Matching, presented by Ron Whitney.
+ How to Grow your Business Moderator Greg Esh.

/see: http://www.irta.com/Portals/0/Newsletters/...0CONVENTION.doc

Website: http://www.irta.com/

There's Real Value in the Barter Networks
============

■ $6.5 billion transacted each year in commercial barter industry.
■ It is estimated that more than 250,000 businesses actively use barter exchanges.
■ The barter industry is growing at approximately 8% per year.

IMS Does It Again...Acquiring Steve Webster's Alliance Barter
International Monetary Systems (OTCBB:INLM) ... update : Daily-1 year

...continues its "PacMan-like" focus of acquiring the nation's top trade exchanges. Their latest coup being Alliance Barter, one of the best operated exchanges in the country with an especially strong trade dollar. The Rochester NY-based Alliance serves clients in Buffalo and Syracuse, with a Canadian office in Toronto.

Map


Don Mardak, CEO of IMS, says this merger will open the door for expansion into Canada, in addition to bringing a wealth of new products and services into the IMS Barter network.

Steve Webster, the founder and owner of Alliance Barter, is a long-time respected leader in the commercial barter industry and a member of the IRTA Barter Hall of Fame. He is the only person who has been president of both industry trade associations, IRTA and NATE.

This is Steve Webster's 29th year in the barter business. An excellent cover story on Alliance Barter was published in BarterNews, to view the article click on http://www.barternews.com/pdf/34-37Alliance.pdf

About International Monetary Systems
(Praetorian Capital, 10% Owner)

SHARE PRICE AS OF 9/30/08 ......................$0.33
SHARES OUTSTANDING (9/30/08) ..... 61 MILLION
MARKET CAP ............................... $20 MILLION
2006 BARTER TRANSACTIONS ......... $72 MILLION
2007 BARTER TRANSACTIONS ....... $114 MILLION + 58.3%

Founded in 1985, International Monetary Systems (IMS) serves 18,000 businesses representing 23,000 cardholders in 50 North American markets. Based in New Berlin, Wisconsin, and managed by seasoned industry veterans, IMS is one of the largest publicly traded barter companies in the world and is continually expanding its network by adding exchange locations. The company's proprietary transaction clearing software, Trade Network Tracking (TNT) System, enables businesses and individuals to trade goods and services online using an electronic currency known as trade dollars. The IMS network allows companies to create cost savings and connect to new customers by incorporating barter opportunities in their business models. Further information can be obtained at the company's Web site at: http://www.imsbarter.com.

IMS is a major participant in two industry trade association currencies: the Barter Association National Currency (The BANC) and the Universal Currency (The UC). This provides IMS members the opportunity to market their products and services not only in the IMS network, but across North America and internationally.

Factsheet : http://www.imsbarter.com/media/factsheet.pdf

==


Barron Sells Barter Connections
Ken Barron, who ran Barter Connections for the past 24 years, has sold his 1,000 member Newton Center (outside Boston) trade exchange to 59-year-old businessman Steve Romsey. The price was for a reported “just under a million dollars.”

For more information see http://www.barterconnectionsinc.com
==

Bartercard’s Tony Falkenstein Inducted Into New Zealand Business Hall of Fame
The hall of fame recognizes business leaders who have made significant contribution to New Zealand business over the past 200 years. Congratulations to Tony Falkenstein, owner of Bartercard New Zealand, who was inducted into the Fairfax Media New Zealand Business Hall of Fame by the Governor General.

For more information visit http://www.Bartercard.com
==

Another related approach

How Corporate Trade Works At Active International

Active International is the world’s leading corporate trading company. Since 1984, we have created over $1.5 billion
in cash savings for our clients by applying our business model to their businesses. In a corporate trade transaction,
a company sells its underperforming assets to Active in exchange for a trade credit valued at a substantially greater
amount than the current fair market value. The selling price may represent wholesale or original value of the traded asset
(in the case of merchandise). As a global remarketer, Active can acquire the underperforming asset in one part of the
world, ship it to another part of the world — adhering to any remarketing restrictions — and fulfill the trade credit balance
in yet another.

The client can then use the trade credit, in lieu of cash, to cover a portion of the cash outlay for media, printing, travel,
POP, meeting and event planning needs and more, which are purchased by Active through its global network of resources.

Helping Our Clients Realize Value
The corporate trade model works across many industry sectors. Here are two examples.
+ A large appliance company had an excess of 10,000 microwave ovens. The ovens had a wholesale price of $1 million,
but economic factors had depleted the value. Though still new and in sealed cartons, the inventory was worth $300,000
at most on the market. Active agreed to purchase the entire inventory and offered the client the full wholesale value of
$1 million in a trade credit, which was used to offset a media budget of $4 million, with the balance of $3 million payable
in cash. By utilizing their credit, the client was able to save $1 million in cash and purchased its media, which was placed
by Active in accordance with the client’s benchmark pricing and placement requirements. In this case, the appliance
company realized the full economic benefit of the product, an added $700,000 of value beyond liquidation, and still provided
for full commission or fee for its agency.

In another instance, as a major movie studio decided tophase out their VHS production and invest resources in the
DVD market, Active acquired the inventory (over 25 million units) and designed a customized remarketing program for
the client, selling the inventory over time to a pre-approved secondary market of over 50 different buyers throughout the
country. Rather than suffer an economic loss, the savings realized from this transaction has allowed the studio to
recover the full cost from the inventory in the form of cash savings for marketing expenses and advertising placements,
including multinational advertising campaigns.

Helping Our Clients Remain Competitive
Today corporate trading is used by more than half of Fortune 500 companies. Active International leads the industry
in providing companies with this mainstream tool — helping them find new and valuable ways to deal with their
underperforming assets, retain their quality and competitive edge — and importantly, positively impact their bottom line.

/see: http://www.activeinternational.com/images/.../busfin1205.pdf

http://www.activeinternational.com/default.aspx?id=178

You have tweaked my interest with this. Can you say a bit more about it?

I nearly joined a barter exchange to sell some IT services- didnt in the end.
Here's some more info from one of the sites I used to look into it.
+++++++++++++++++++

To address these needs, some business-to-business barter exchanges also have staked out an online presence. Today's most visible B2B barter sites are of two main types: the first is the online extension of what started as offline exchanges (Ubarter, BXIads, ITEX, BarterExpress). The others (BarterItOnline, BigVine, and BarterTrust) were created specifically as Internet barter businesses.

What the B2B exchanges enable business owners to do is turn over products and services to a second group of consumers--other business owners--willing to buy and sell without using cash.

+ +

Commissions, which for traditional land-based barter exchanges range from 8 percent to 15 percent of purchases, are due after transactions occur. Sometimes, however, exchanges charge 5 percent on the sales side and 5 percent on purchases to help encourage equal buying and selling activity. Online exchanges, on the other hand, presumably because their overhead costs are consolidated and therefore lower, are able to charge lower transaction fees. At BarterItOnline, for instance, buyers are charged a transaction fee of only 4% in cash and another 4% commission paid by the buyer in trade with e-dollars

+ +

Another key benefit to the entrepreneur is his or her ability to purchase such services as advertising on a barter basis and attract cash-paying customers. Additionally, joining a barter exchange-either offline or online-has the immediate and important effect of creating a new sales channel for a member business: once a business becomes part of a private "economy" using a proprietary barter currency, other businesses who may never have bought and sold from one another now are incentivized to do business with fellow exchange members, thus creating new sales channels

http://www.businessknowhow.com/money/barter.htm

Illegal use of barter currency

some links
Barter Exchanges: http://www.gigafree.com/barter.html
http://westcoastbarter.com/FAQ_index.asp?
http://www.amazon.com/Barter-Future-Money-...s/dp/1571010610
http://purplemotes.net/tag/barter/
http://www.newworldencyclopedia.org/entry/Barter

Counterfeit Barter Currency?
++++++++++++++++++

"However, the security problem is the same as Uncle Sam's: counterfeiting. If the barter currency becomes valuable, enterprising individuals will no doubt attempt to counterfeit. Modern photocopiers can even produce colored documents by laser technology, making the problem an even larger threat."
+ +
"• If you opt for a local currency, design one as elegantly as you like. Be careful of counterfeiting opportunities. Consider printing small bills only. Counterfeiters rarely print U.S. currency in $1 denominations. It's more work than it's worth.
• Use an expiration date on currency you print to keep the currency changing hands. For vitality, the currency must be visible in the marketplace.
•Add a registration area to your currency. This way, you can get names and addresses of the first user of each bill. Also, valuable mailing lists come from knowing who used your currency"

http://www.motherearthnews.com/Nature-Comm...-On-Barter.aspx

There's another - public barter co, : ITEX

International Monetary Systems - New Berlin, Wisconsin
Stock Symbol: INLM:OB
Offices in at least 6 U.S. and 2 Canadian cities.
Holding company that owns the Continental Trade Exchange barter network.

International Trade Exchange (ITEX) - Sacramento, California [a]
Stock Symbol: ITEX.OB
Note: ITEX may have around 100 Broker Offices throughout the US and Canada.
ITEX acquired BXI in 2005 and BXI offices became ITEX offices.

http://www.gigafree.com/barter.html

Thnx for those posts.
I will put charts for both IMS and ITEX in the header

http://www.itex.com

ITEX First Quarter 2009 Highlights
-- Revenue of $3,899,000 compared to $3,853,000 in the same period last year.
-- Net income of $45,000 compared to $156,000 in 2008.
-- Net cash provided from operations of $706,000 compared to $803,000 in 2008.
-- Cash at end of period was $1,282,000 compared to $1,061,000 at July 31, 2008.
-- ITEX Media Services was launched with the August 1, 2008 acquisition of a media trading platform and media and travel clients.
-- Created a new business development department tasked with creating relationships with companies that have a national presence to assist with our growth on the local level.
-- Signed a partnership agreement with iCare, a division of SYSCO, Inc., an enterprise-level supplier of products and services to the food service and hospitality industries.

Subsequent Events
-- In November, we entered into an agreement with U.S. Bank to increase the maximum loan amount under our revolving credit facility from $1.0 million to $1.5 million, to lower the interest rate of the facility, to remove certain borrowing base limitations, and to extend the maturity date to November 30, 2009.
-- In November, we paid off the remaining balance of our Promissory Note due to The Intagio Group, Inc. for the recently acquired media services assets.

About ITEX

ITEX, The Membership Trading Community(SM), is a thriving network of participating member businesses. Members increase sales through an exclusive distribution channel managed by franchisees, licensees and corporate-owned locations, by utilizing ITEX dollars to exchange goods and services. ITEX is powered by ITEX Payment Systems, the leading payment technology platform for processing cashless business transactions. ITEX is headquartered in Bellevue, WA. For more information, please visit ITEX's website at http://www.itex.com. We routinely post important information on the investor relations portion of our website.

Following the online trading markets

Craigslist isn't the only online bartering bazaar. Check out these trading sites' features and unique personality traits.

ITEX.COM : http://www.itex.com
Tag line: "Connect. Trade. Save."
Geared to: Small businesses.
This online marketplace enables small-business owners to make cashless transactions using "ITEX dollars," which users earn by trading their products, services and excess inventory through the site's local trade directors. The ITEX dollars are then used to buy and sell products and services among members instead of spending hard cash. So an advertising agency looking for an attorney hooks up with a law firm needing some advertising space through the ITEX trade director. Now that's good business.

SWAPTHING.COM : http://www.swapthing.com
Tag line: "My thing for your thing."
Geared to: Sociable swappers.
This community-driven bartering site (which smartly allows you a link to access Facebook while you swap) specializes in music, collectibles, comic books and antiques, though you can find just about anything. The site lets people with common interests connect through SwapCircles, by-invitation-only communities for trading goods and services.

U-EXCHANGE.COM : http://www.u-exchange.com
Tag line: "Trade anything. Pay nothing."
Geared to: House swappers.
While this site invites you to trade anything, most NYC-area posters are offering time in their apartments and beach houses in exchange for comfortable accommodations abroad such as a four-bedroom house in Southampton for an apartment in Florence, Italy. It includes useful features such as a bookmarking function to tag the listings you like, or a "stop" icon for when your trade is finished or you're away on vacation.

SWAPACE.COM : http://www.swapace.com
Tag line: "Swap anything for anything."
Geared to: Students.
This user-friendly site packs colorful icons, avatars and a simple three-step process. After signing up, you create a list of what you want along with what you can trade. Then you either advertise your item ("I want to sell my cell phone for $200") or offer to swap it ("I'll trade my cell for your computer"). Then negotiate to get the best deal.

OURSWAPS.COM : http://www.ourswaps.com
Tag line: "Swapping made easy."
Geared to: Pals who pay.
This site ­seamlessly merges online trading with eBay auctions, allowing users to combine cash offers with their products or services in the event that two items don't have ­identical value. Include the cash value of an item along with what you'd like in exchange, and sift through the offers that come through. Offers on vehicles, clothing and jewelry are especially popular on this site.

BARTER CARD INTERNATIONAL ... http://www.bartercard.co.uk/


The industry has a reputation for being "pretty grubby, a bit spivvy". This is partly due to a profusion of small barter trade agencies claiming to represent small businesses that came out of the internet boom in the 1990s, nearly all of which have disappeared. One of the few that has prospered is BarterCard International, originally from Australia but now based in 13 countries and with 2,000 participating businesses in the UK alone.

BarterCard's members are nearly all small businesses, most with between five and 100 employees, according to Wayne Sharpe, the company founder and now chief executive of BarterCard UK. "Let's say a restaurant wants to get £10,000 worth of printing done - it's unlikely it will find a printer that wants £10,000 worth of meals. With BarterCard, the restaurant pays the printer in trade pounds, so it now owes £10,000 of meals to the BarterCard network," Sharpe explains. The network now embraces photographers, plumbers, even dentists, who can cash in those credits by eating in your restaurant.

BarterCard's other job is to take the risk out of bartering. It vets all its members and absorbs the risk, so that if another member goes bust, you don't lose your credit. In return, it takes 5.5% of each transaction in cash and a further 1% in credit. "Historically, barter has been a bit of a wild west show," Sharpe says. "There is less risk in our system than there is in a normal cash transaction."

Barter at this level saves cash. Sometimes it can also find you new customers. John Talbot runs Talbot's Investigations, a private investigation firm in Reading. Even after 17 years in the business, his turnover grew by 15% when he found he could barter spare capacity through BarterCard, earning trade credits for finding debtors or performing surveillance. He is aiming for 25% of his turnover as barter business. "It's a great way to use up spare capacity," he says. "But it leads to new contacts, and some of those customers refer me to contacts in the cash world."

BarterCard's global network is also making barter a true global currency for small businesses. "We have not come across any business that hasn't done a barter transaction. The reason they don't do it more often is probably because they don't have a secure mechanism by which to do it," Sharpe says. "With us, a hotelier in London can earn trade pounds here, walk into a restaurant in Sydney and pay with our currency."

/more: http://www.bartercard.co.uk/
== ==

TRANSACTION EXAMPLE

A restaurant wishes to "barter" for £10,000 worth of printing using meals and drinks. No printer would ever want £10,000 in meals from the one restaurant, however by selecting a Bartercard printer, the restaurateur pays the printer with T£10,000 Trade pounds. The printer’s account is "credited" and the restaurateur’s account "debited", so the restaurant now owes T£10,000 in meals to the Bartercard network, NOT the printer. This is repaid as various Bartercard members come to the restaurant (new business) over the following months. Hence, the restaurant has paid for its printing requirements with meals, using an interest-free "line of credit" and at a cost of approximately 30 - 40 pence in the pound, in replacement good cost.

The printer can now use the Trade pounds earned to buy office furniture, advertising, car repairs, stationery, courier services, colour separations, accounting and legal services ~ even a family holiday. These are all commodities for which the printer would normally pay cash. By using their Bartercard Trade pounds, the printer conserves his cash and benefits from the extra business.

Value of "Trade Pounds":
The BC website talk about "trade pounds" having a real value of 40%.
Transactions in real estate tried to give people a way to swap out big amounts, but as Real Estate peaked,
the price of BC's shares fell, and it had to privatise.
See: http://bci.bartercard.com/?page=investor-relations

ACADEMIC THEORY - re: Bartering

A good summary of (academic) literature is provided by "Why is Corporate Barter?" by Nigel Healey (1996). The kind of firm motivation usually put forward for barter is:
a ) an attempt to hide, from established customers, price discounts to new customers;
b ) balance-sheet "window-dressing," to hide write-downs of otherwise unsalable inventory;
c ) a form of monopolistic tying that decreases competition.

Basic microeconomic theory shows that there can be efficiency gains from a). A firm with price-setting power can then
capture more of the surplus and avoid the deadweight losses imposed by being able to charge only a single
monopolistic price. But there would still be deadweight losses from B ) and c). Thus barter is usually seen as good for
individual firms, but as likely to be quite bad for overall efficiency -- more "trade diverting" than "trade creating" in
terms of standard (neoclassical) trade theory.

In debates on other barter-related systems such as countertrade, however, a few economists see possible microeconomic
gains. Barter as countertrade may mitigate asymmetric information problems (Marin and Schnitzer 1995, Hennart and
Anderson 1983). Community barter exchanges like Local Exchange and Trade Systems (LETS) may improve
community information flows (Williams 1996). These microeconomic efficiencies might offset what has traditionally
been seen as the "inherent" informational inefficiencies of barter.
. . .
The very existence of a large market for corporate barter, much less its rapid growth, represents something of a
challenge for modern economics. The inefficiency of barter is one of the keystones of monetary theory. The difficulty
of finding "a double coincidence of wants" was seen by William Stanley Jevons (1875) as motivating the invention of
money. Contemporary economic theorists, as in the volume edited by Starr (1989), continue to look for the
"micro-foundations" of money in the search-costs of decentralized barter. These search costs can include uncertainty
about the quality of heterogeneous goods offered as a quid pro quo ( Kiyotaki and Wright 1989, Aiyagari and Wallace
1991).

/more: http://www.uea.ac.uk/env/ijccr/pdfs/IJCCR%...1%20Stodder.pdf

only way to get paid baby.
In fact
Its the only way to do business these days
wealth has nothing to do with money, its the people you know and the things that you share.
But Shhh
Its a secret.

These days you don't even need to overcome the double coincidence of wants.

Do Tell more. Are you really using barter?

BTW:
The ITEX results do not look too bad:

Fiscal Year 2008 Highlights
· Marketplace revenue increased 13% in 2008 to $15,964,000 from $14,171,000 in 2007.
· Net cash provided by operating activities increased 15% in 2008 to $2,374,000 from $2,057,000 in 2007.
· Stockholders' equity increased 8% in 2008 to $13,319,000 from $12,330,000 in 2007.
· Total assets increased 13% in 2008 to $16,149,000 from $14,304,000 in 2007.

Acquired assets of two commercial trade exchange networks, expanding our presence in six U.S. regions.

/more: http://www.itex.com/aboutus/pr/annual_mess...he_chairman/89/

Price as of 7/31/08.....: $0.88
Market Capitalization..: $15,678,298
Shares Outstanding....: 17,816,248
Fiscal Year End...........: July 31st
Stock Price as of July 31: 2008: $.88 / 2007: $.80 / 2006: $.58 / 2005: $.38

ITEX / Dec.31, 2008: $0.42 x 17.8 million = $ 7.5 Million MktCap

On a small scale with like minded developers over the last few years with LTKTBM and basic bits of my AI and sound tech, where we'd swap technologies, these days things are more complicated, and have a much more 'communism' feel, so while I don't 'straight swap' - trades are delayed, but most of the highest value stuff I get to play with have no actual calculable monetary value.
any currency tends to come from tax exempt sources (I don't really like discussing what those are in case it encourages a change in their status)

Once you build a strong enough network, and realise money is just a method of exchanging trust, its glaringly obvious you don't need to use 'money' to exchange trust for high value items.

The example I like to use (which is my ultimate goal), is if one person trains people to fly helicopters, another owns a large yacht with a helipad, and they both owe me some form of 'debt', the best way to repay me is to train me to fly helicopters, and let me use their stuff for my holidays.

That ethos has sent me to some pretty gorgeous places over the last few years, while using cash for nothing more than flights and food.

Diamond traders are the pinnacle of this type of trade, moving around 10s of millions worth of diamonds a go with nothing more than a nod and a thank you.
Of course drug dealers operate a similar system, and I take a particular pride in avoiding that temptation.

Very nice, sparks



In fact, you are talking about a "circle of trust", which is the key to making these things work.
And trust is exactly what the US risks losing. Will Barter groups pick up the ball, if/when the US drops it?
Maybe.

It certainly may be worth trying to build one up in HK, and maybe globally. That's exactly what I have in mind.

BTW, do you do something in the diamond sector? If so, maybe we should discuss that too.

Without having read the whole thread, I post the following which is taken from an article I am writing for The Idler magazine.

BTW I would suggest many of those barter sites use some kind of money substitute , where you sell and service or product the worth of which is stored up and can be used for another service or product at a later stage.

Many an anarchist, myself included, has dreamt of a society without money. Barter is a beautiful system and among its many alluring attractions is the fact that government can’t get its grubby claws in on any deal through some form of tax. But because barter relies on what is called ‘The Double Coincidence Of Wants’ – you have to want what I am offering at just the moment I want what you are offering - it is, sadly, impractical on a day-to-day basis.

Let’s say you are an erotic masseuse and I am a plumber. In a society without money, for any transaction to take place between us I am going to have to want an erotic massage at just the moment you need some plumbing done. There will be the occasions when this coincidence occurs, but they will be infrequent. Some means of storing the value of the work one of us has done for the other is needed. This can then be used at a later stage to buy other goods or services. In other words, like it or loathe it, you need some kind of money for a society to function. Even the most primitive developed some kind of payments system.

Two types of plumbing needing repair simultaneously. That's unlikely... and well put.
"Money" allows the value of either transaction to be stored until a suitable "want" appears.
=============================================================

What is the most suitable currency to "store value"? Can Barter currencies beat Fiat currencies?

If a government is making too many promises, and printing currency to satisfy many, many wants, then it is putting "stored value" (its currency) in the hands of many different people. All that extra currency means that "wants" (backed up by purchasing power) will be chasing a limited amount of goods, and the prices of those goods will be pushed upwards.

The same risk of excess currency faces any Barter Currency. And that is a problem that I have been grappling with.

If a Barter business takes off, then there is a risk that too many transactions will get done, and too much barter currency will be in the hands of traders. If those willing to barter eventually get stuffed with barter currency, and cannot find things within the barter network that they want to buy, then they will want to stop taking more barter currency, and they will "shut the door" on additional barter transactions.

My gut tells me that a barter network needs to be very careful about the pricing it allows on barter transactions. If people are selling at a substantially higher price than they can get from cash sales, then as transactions get done, barter currency will flow into the hands of the seller and this build-up will cheapen the currency in the mind of the holder. Sellers will be keen to offload any currency they get, and be reluctant to sell any more in barter trades. In this way, a weak currency will soon undermine the whole barter network.

When I read that BarterCard tells its people than their BarterPunds have a real value of 40%, it makes me think the currency has become greatly devalued (relative to the genuine Pound), and the entire Barter network may be undermined by a currency that lacks credibility.

I have been searching Google for links to articles that talk about the demise of barter currencies, and the measures that networks may take to avoid this.

even Injin's Bartering

Injins Alternative Universe



he does talk sense sometimes though

http://www.housepricecrash.co.uk/forum/ind...t&p=1573545

I think he is an impressive poster, and I would like to see him on GEI.
Do you know him well enough to invite him obn my behalf?
You can tell him about this thread. It would be great to have his contributions here

Hi

Haha. You are a member already - i should have known that, i suppose.
Any thoughts on barter for here ?
Also, you might want to look at the Community Currency thread, if the subject interest you.

I copied an excerpt of your Blog over there.

Hello

http://www.timesonline.co.uk/tol/news/uk/article5488528.ece

"In the UK, a village pub, the Pigs, at Edgefield, in Norfolk, offered pints in exchange for locally sourced food to be cooked in its kitchens. Thousands of others trade more formally through exchanges such as Bartercard: last year the Fashion TV network used Bartercard to save £110,000 in cash on alcohol and other goods for its launch party – which FTV is repaying by providing advertising.

Happily, barter works for individuals too. A Canadian, Kyle MacDon-ald, made headlines by bartering, via trade after trade on the internet, a paper clip for a house. Only slightly less impressive, my friend the photographer Guy Hills persuaded every tailor in Savile Row to make him an outfit in return for photographing them at work. A couple named Dan and Gemma Scott cut £9,000 from the cost of their wedding by bartering for the church, the reception, the cars and the photos. To do this, they worked as housekeeper and labourer, dug ditches, delivered leaflets and repaired cars. “When Gemma started planning the wedding,” Dan said, “I knew we didn’t have the money for it. We ended up with a £12,000 wedding for just £3,000"

== ==

To get around the limitations of goods-for-goods, you need a Barter CURRENCY.

BARTER KEEPS POPPING UP... on other threads

1/
http://www.ft.com/cms/s/0/3e5c633c-ebdc-11...00779fd2ac.html

Countries struggling to secure credit have resorted to barter and secretive government-to-government deals to buy food, with some contracts worth hundreds of millions of dollars.

In a striking example of how the global financial crisis and high food prices have strained the finances of poor and middle-income nations, countries including Russia, Malaysia, Vietnam and Morocco say they have signed or are discussing inter-government and barter deals to import commodities from rice to vegetable oil.

The revival of these trade practices, used rarely in the last 20 years and usually by nations subject to international embargoes and the old communist bloc, is a result of the countries’ failure to secure trade financing as bank lending has dried up.

The countries have not disclosed the value of any deals, and some have refused even to confirm their existence. Officials estimated that they ranged from $5m for smaller contracts to more than $500m for the biggest.

Josette Sheeran, head of the United Nations’ World Food Programme, said senior government officials, including heads of state, had told the WFP they were facing “difficulties” obtaining credit to purchase food. “This could be a big problem,” she told the Financial Times.

While food prices have fallen from their record high last year, this fall is only temporary, a study by Chatham House, the London-based think-tank, suggests.

Last week, Malaysia’s commodities minister, Datuk Peter Chin Fah Kui, said Kuala Lumpur had already signed a barter deal swapping palm oil for fertilizer and machinery with North Korea, Cuba and Russia. He said Malaysia was talking to Morocco, Jordan, Syria and Iran about other barter deals.

“[Bartering] could be used for contracts with other countries that do not have the cash,” Mr Chin told the local press. “We can set the conditions for them to supply us with the raw materials that we need.”

Thailand, the world’s largest exporter of rice, is discussing barter deals with Middle Eastern countries, including Iran. The Philippines, the world’s largest importer of rice, has secured rice needs for this year through a diplomatic agreement with Hanoi.

The countries’ struggle to obtain credit to import food is boosting the price of domestic crops. Ms Sheeran said that prices of crops in some African countries were rising sharply even as international food commodities prices had fallen from last summer.

The move to barter shows the global food crisis that started last year is far from over.

2/

Or maybe ... a new type of broker for barter transactions
(I'd like to move GEI in that direction BTW. Or maybe the GEI-N section of this site.)

/see:

Hi DrBubb,

Very interesting and thought provoking thread.

How do you distinguish a 'barter currency' from any other currency? After all, aren't the dollar and sterling just barter currencies in that they are a means of someone to spend their 'worktime' at a later date?

All currencies depend on the trust of the people using them. Even a gold based currency relies on the trust that the gold is there.

It seems to me that you are aiming to create a new currency because the general trust in the established ones is slipping away.

To create a new barter currency the system behind it would have to be totally trusted by the users. They would need to know that the work they want done would be done and the worker to know that their account would be credited with a meaningful substitute.

Do you think this trust could be generated at a fast enough pace with a large enough number of people to make it a viable option? Or will it develop slowly from locally established groups?

A Barter currency is one that trades alongside a country's main currency.
Only those companies are willing to accept the barter currency, are transacting in it, and it is not
used by the majority of the companies. I suppose if the number taking it grows and grows, it can replace
the main fiat currency. But I am unable to think of any instances where that has happened.



Yes, you do need trust. And there is a risk that the barter currency will be in over-supply,
so you need precautions against that.



Typically, support for a barter currency must be built at a community level. That takes time & effort

It would seem at first glance that barter currencies would develop only where trust was already established between interested parties. Would it therefore follow that it is not a very good 'opportunity' for outside profit? When that stage is reached it would have already become a fiat currency.

Exactly.
Trust is critical in any transaction.
If you cannot trust a currency, you will not accept or hold it.
You need to have trust in the quality of goods in a Barter transaction too.

==

HK's first platform for Barter trades has been launched:

Visit : http://www.TradeDuck.com , and hit the Google translator

INLM's Don Mardak was interviewed by Chris Valerio on Bloomberg this weekend

On Venture This Week:

Don Mardak, CEO of International Monetary Systems - the largest full-service membership-based trading network in the U.S. talks about the business of barter, the state of the barter industry, and industry trends. 65% of companies at NYSE are resorting to barter. The international reciprocal trade association, which tracks the barter industry, says that transactions for the industry overall are up as much as 25 percent in recent months. They also report that 470,000 companies in US actively participate in barter with whopping 12 billion dollars in annual sales.

/see: http://www.facebook.com/group.php?gid=29654958987

INLM's investor relations: http://www.imsbarter.com/investor-relations

The CEO has recently added to his 30% stake, as a shareholder with a 16% stake became a forced seller.

Trades at half of Book Value, and 1/3 of revenues

About International Monetary Systems

Founded in 1985, International Monetary Systems (IMS) serves 18,000
businesses representing 23,000 cardholders in 50 North American markets.
Based in New Berlin, Wisconsin, and managed by seasoned industry veterans,
IMS is one of the largest publicly traded barter companies in the world
and is continually expanding its network by adding exchange locations. The
company's proprietary transaction clearing software, Trade Network
Tracking (TNT) System, enables businesses and individuals to trade goods
and services online using an electronic currency known as trade dollars.
The IMS network allows companies to create cost savings and connect to new
customers by incorporating barter opportunities in their business models.
Further information can be obtained at the company's Web site at:
www.imsbarter.com.