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Community Currencies - Worgl & the Wara, 1930's

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Depreciating community-owned currencies

===========================

 

The Worgl Schillings

 

57aview02ec7.jpg..57aview02zi4.jpg

 

In the early 1930s the small town of Worgl in the Austrian Tyrol, suffering like every other town in Europe and America from the Great Depression, took the unlikely step of issuing its own currency.

 

Its burgomaster, Michael Unterguggenberger, faced an empty treasury, because the unemployed citizens could not pay their taxes; roads and bridges needed repair and parks needed maintenance, for which the town could not pay; and idle men and women earned no wages.

 

He recognised that all three problems could be solved if he could find the connecting link.

 

That link was money. The three problems coexisted because no one had any of it, and his simple solution was to create money locally.

 

He issued numbered 'labour certificates' to the value of 32,000 schillings, in denominations of 1, 5 and 10 schillings, respectively. These became valid only after being stamped at the town hall, and depreciated monthly by 1 per cent of their nominal value.

 

(read the article on the Link)

 

What lessons can be learnt? First and foremost, that there is nothing sacred about the 'national' money with which we grew up.

 

Money - as information technology, metal chips, paper slips and electronic blips - is what people will accept in payment for goods and services and taxes.

 

'It was the fact that the community or regional money could be used to pay taxes, and also exchanged for familiar national currency, that made it acceptable and successful'

 

If they will accept community or regional money, then it is as good as Ls or $s or Dms. It was the fact that the community or regional money could be used to pay taxes, and also exchanged for familiar national currency, that made it acceptable and successful.

 

'A depressed community in an apparently hopeless situation found a way of ending the seemingly insoluble problems of unemployment'

 

/more: http://www.globalideasbank.org/site/bank/idea.php?ideaId=904

 

German Community Currencies: http://www.appropriate-economics.org/img/germany.html

Complimentary Currencies...... : http://www.appropriate-economics.org/introduction.html

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I found this interesting since watching the money masters and how, IIRC, Lincoln paid for his war with the Confederates in the same way.

 

In the town of Worgl, what I don't understand is how the new currency could be exchanged for the national currency. The problem being that the reason the town issued the new currency was because they didn't have any national currency to begin with. How did they then manage to exchange the new currency for national currency when the certificates were handed in at the end of each year?

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How did they then manage to exchange the new currency for national currency when the certificates were handed in at the end of each year?

 

stadtweselback.jpg

Lubech City Money, 1921

 

They must have had a limit. Maybe they never hit it?

 

How do you start issuing a currency, and how do you end it?

 

The Malinvestment Issue

I suppose they can just print the currency, and hand it out in return for labor.

But what if the labor is unproductive: suppose half of them go around breaking windows,

and the other half are employed to repair them. After all this "labor", there will be

nothing left, no return generated, and no hard currency or gold generated, to be used to

retire the community currency that was printed and handed out. In short, the currency

was printed to support a malinvestment of labor.

 

Now if instead, a community printed a currency, and it was used to reward labor that

tilled the fields, and produced a crop, with only a part of it consumed locally. Then the

part that is sold outside the area would generate a hard currency. And that could be used

to retire the outstanding local currency one day.

 

This is the challenge faced by the Obama Team now, can they get their stimulus spending

to generate net wealth, or will it merely keep people employed while their efforts destroy

wealth.

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WIRED INTERVIEW - with Hazel Henderson (1997)

 

What's the biggest economic shift you see coming now?

The demise of banking. If the bankers don't extend credit, if money isn't democratized, we'll go around them.

 

How?

 

High tech bartering. We could not go around the money system until people had computers and the Internet, because bartering is clunky. But now you can do four-, five-, or six-way trades, where you say, "We want bananas, these people have tin, and these people have copper to sell," and computers keep track.

 

What about locally based currencies?

We need three currencies. A global reserve currency, for trade transactions. We need national currencies, in which I include food stamps, student loans, vouchers for this and that. And then there are locally based systems - computer barter and local currencies. This would allow a huge paradigm shift, because money wouldn't be scarce. And people would have the option of not running around, not getting and spending money.

 

Won't, say, Citibank find ways to co-opt this?

The old giants can't turn their ships around fast enough. Their business is the business of scarcity. What we're talking about is the abundance business, where anyone can make a market in anything. Big companies are terrified of this. They're offering cash accounts and smartcards, but this is simply recycling. They can't get the idea that we don't need the money loop. If you're Citibank, and you have all that sunk capital - all your core competencies are in manipulating the money loop - then you're sunk if people begin to turn away.

 

So are we heading toward perfect competition?

We're going to see a balance of cooperation and competition. We got lost in the 18th-century textbooks, which saw only the competitive side. We haven't seen the utility of the cooperation side, the standard-setting side, the side that creates protocols in information markets.

 

Are economists starting to see that?

Economics is trying to recycle itself by grabbing insights from other disciplines. Economists are running around saying, "We're chaos theorists, we're game theorists." But they're coming off too narrow a framework

 

/more: http://hazelhenderson.com/interviews/winWin.html

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PRINTING UP CURRENCY - Example : the Flathead Valley "Hour"

 

This month, Isaac is busy printing money. Unlike the nation's currency, her HOURS will not feature an old white man of the ruling elite and a very big building. Instead, the words “Flathead HOURS Exchange” are set against hand-painted mandalas. On the back is a map of Montana, with the Flathead Valley highlighted, and the words “In Each Other We Trust.”

 

It started with the Ithaca Hour

2376374648964ae2b68ze6.jpg

 

It's all on a very distinctive and durable paper, chosen specially to avoid counterfeiting, with serial numbers and stamped embossing. Each bill also is hand-marked for identification.

 

“Counterfeiting is not a primary concern,” Isaac said, “but it is something we had to consider.”

 

Mostly, though, she's considering how to get people signed on. She's been spreading the idea word-of-mouth and with posters plastering the valley, and so far about 100 goods and/or services have been submitted for the inaugural directory.

 

/more: http://www.missoulian.com/articles/2008/03...ocal/news02.txt

 

QUESTION:

=======

Who gets to SPEND that freshly printed currency?

Or, if people buy it, who do they buy it from, and how much do they pay?

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...

We need three currencies. A global reserve currency, for trade transactions. We need national currencies, in which I include food stamps, student loans, vouchers for this and that. And then there are locally based systems - computer barter and local currencies. This would allow a huge paradigm shift, because money wouldn't be scarce. And people would have the option of not running around, not getting and spending money.

...

 

And when you move area? Or one local area manipulates their local exchange rate against a smaller local currency?

 

The failing of this type of monetary system is exactly the same as all of the others, the breakdown of trust. Like it or not the higher up the tree someone gets the less you can trust them, the old adage ‘of power corrupts’ always comes back to haunt regardless of the political system used and they break the trust in the monetary system.

 

The only thing that people trust is the tangible, that can be transported by hand, hoarded for the rainy day without loss of value. Everything else can be manipulated by those higher up the tree which is why people are no longer allowed to use finite currencies that time has proved to be the best solution, the precious and semi precious metals.

 

This is really the first time that I have actually believed this.

 

P.S. Does this make me a gold bug or a realist, which closet have I just come out of? :blink:

 

 

 

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BAY BUCKS, of Traverse City, Michigan

========

http://www.baybucks.org/

 

The Traverse Area Community Currency Corporation (TACCC) is a nonprofit organization, democratically run by a small board of directors, all of whom are working on this project for love of the community and from a sense of adventure.

 

Bay Bucks volunteers are interested in keeping the money circulating and will work with Bay Bucks members to find, or enlist suppliers or service providers who accept Bay Bucks. Doing this, we hope, will help weave together small business commerce in our region, and help establish a preference for it on the part of consumers in the region. Bay Bucks can identify opportunities for import substitution and help personalize our local economy.

 

0.jpg..39.jpg

 

History of Bay Bucks

 

The Traverse Area Community Currency Corporation, which has been working for the last two years to think through and organize the issue of Bay Bucks, is starting small, with an initial printing of about $99,000 worth of Bay Bucks which, for the time being, will be pegged to the federal dollar. The dollar may not go as far as it used to, but most of us, despite creeping inflation, share an idea of what a dollar can buy.

 

Recently, when Bay Bucks Board members Sharon Flesher, a local editor and co-organizer of Traverse City's late car-sharing club and author Stephanie Mills hit Front Street in a quest for businesses interested in joining the system, crafty local shopkeepers grilled them about Bay Bucks. New ideas for using it Bay Bucks came out of these conversations. Sandy at Back Country Outfitters, didn't think he'd be able to use Bay Bucks to buy inventory, but thought they might be useful gifts to foster good customer relations.

 

One of Sandy's employees was concerned about the security of the printing. He wondered what was to keep the printer from running off a few extra thou when nobody was looking. There are several safeguards, first and foremost, trust. Printer Chad Pastotnik, of Deep Woods Press, has been in the discussion since the beginning. Bay Bucks are beautiful and durable, letterpress printed the currency. There are other security features in the bills -- which have been issued in four denominations: BB1, BB5, BB10, and BB20 -- in addition to Chad's high-quality printing.

 

At this writing, there were 56 participating businesses (even more now!) in Traverse City, Cedar, and Lake Leelanau.

 

/more: http://www.baybucks.org/about/?id=39

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Now if instead, a community printed a currency, and it was used to reward labor that

tilled the fields, and produced a crop, with only a part of it consumed locally. Then the

part that is sold outside the area would generate a hard currency. And that could be used

to retire the outstanding local currency one day.

 

I was thinking about this a little and I agree that is one way of doing it. I think another way may be, that at the end of each year when all the certificates are collected, each person is given back 80% new, stamped certificates and 20% national currency. When the general economy improves the national currency is substituted for the local currency. Both of these methods are really only a form of borrowing. At some point in time the labor that generated the stamped certificates is exchanged for the national currency and the labor is absorbed back into the national economy which was itself 'borrowed' to produce the local currency, I hope that makes sense. The advantage is of course that it is borrowing at 0% interest with the risk being that the government/banks may come and close you down (as they did in this case) and you loose your stamped certificates as they become valueless immediately. The borrowing is substituting one form of risk payment (interest payments) with another (the last man holding the stamped certificates when the scheme gets shut down, looses). The question would then be, will the scheme be shut down?

 

The thing I found interesting about the the Flathead Valley "Hour" system was that each person was rewarded the same amount for their work irrespective of whether they were a highly skilled brain surgeon doing brain surgery or an unskilled labourer moving boxes from location 1 to location 2. There is no account for the difficulty of the work which destroys the advantage of specialisation of skills. This is OK in a small local economy but I don't think it would work in a larger environment where a desire to improve quality of life is the motivating factor of work. The main reason I think it would not work would be the temptation of corruption in the controlling powers (i.e. politicians).

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The borrowing is substituting one form of risk payment (interest payments) with another (the last man holding the stamped certificates when the scheme gets shut down, looses). The question would then be, will the scheme be shut down?

 

Some provided for the extinguishment of the currency by having it lose value each month.

That was true with the Worgl Schilling, and almost happened with this currency:

 

Debt-freeMoneySilvioGesell.jpg

 

Shown is a sample debt-free note for 100 Marks, printed by the Reich Currency Office in Germany.

Although dated 1940-41, it was printed 10 years earlier. The obverse shows a portrait of famed economist Silvio Gesell (1862-1930), the inventor of the theory of self-liquidating or stamp scrip. The reverse (not seen here) has three 1-pfennig stamps printed in place, to show their use. This note was never actually issued. Gesell saw a need for a kind of money that would move quickly rather than being hoarded or saved. He promulgated a kind of note that would lose a small percentage of its face value in a specified period, thus encouraging the holder to spend it before it lost part of its value. After thinking about the matter in greater depth, Gesell decided to supply a means of restoring full value to the note. He added spaces for a special stamp to be affixed each week. The cost of the stamp allowing the note to maintain its full face value. This kind of scrip came into use in Germany and Austria, and on a much larger scale in the United States not long afterward.

 

/see: http://www.aitup.org.za/

 

The thing I found interesting about the the Flathead Valley "Hour" system was that each person was rewarded the same amount for their work irrespective of whether they were a highly skilled brain surgeon doing brain surgery or an unskilled labourer moving boxes...

 

Yes. That means that the skilled profesionals will tend to work in the cash economy,

and the laborers may prefer to receive "Hour" currency, sive they are relatively better paid.

 

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THE WARA

 

Here are two more examples of the successful use of debt-free money. These efforts took place in Bavaria and Austria, both in 1931:

 

#1/

The coal mine at Swanenkirchen (in Bavaria) had closed down, and the district was a distressed area. A mining engineer called Hebecker bought the bankrupt mine but found he would need 40,000 Reichsmarks to start operations again. The banks offered him a loan at 5 percent interest, but Hebecker had other plans.

 

warabackad6.jpg

 

He was a disciple of a monetary reformer-Silvio Gesell-whose followers had formed an association and issued their own money, which, needless to say, they used only among themselves.

 

They called this private money the “Wära,” and Hebecker borrowed 40,000 Wära notes from them and offered to employ any miner who would accept them as wages. He also made the Wära redeemable in coal. At the same time, he opened a shop in which the workers could spend their Wäras. Thus the Wäras derived their value directly from the goods in his shop. He had to pay for these in Reichsmarks, but as his coal was also paid for in Reichsmarks, this was no difficulty. The unemployed miners welcomed a chance to start work again, and all went well.

 

The miners’ wages had been the principal source of income in Swanenkirchen, and when the shopkeepers saw that they were all finding their way to Hebecker’s shop, they decided the only way to get their customers back was to accept payment in Wäras. They brought pressure to bear on the wholesalers to do so, too, and they in turn prevailed upon the merchants who supplied them. Soon everyone in that corner of Bavaria was buying and selling in Waras.

 

Swanenkirchen became prosperous. There was no unemployment. Commodities were obtainable. Debts were paid. Other villages saw this and wanted to share in the new prosperity. Even some banks agreed to accept Wäras.

 

But the Reichsbank (a central bank, Germany’s equivalent of the privately controlled Federal Reserve banks in the United States) frowned. The German government surrendered to the Reichsbank, and in November 1921, Wäras were made illegal

 

#2/

Here are two more examples of the successful use of debt-free money. These efforts took place in Bavaria and Austria, both in 1931:

 

The coal mine at Swanenkirchen (in Bavaria) had closed down, and the district was a distressed area. A mining engineer called Hebecker bought the bankrupt mine but found he would need 40,000 Reichsmarks to start operations again. The banks offered him a loan at 5 percent interest, but Hebecker had other plans.

 

He was a disciple of a monetary reformer-Silvio Gesell-whose followers had formed an association and issued their own money, which, needless to say, they used only among themselves.

 

They called this private money the “Wära,” and Hebecker borrowed 40,000 Wära notes from them and offered to employ any miner who would accept them as wages. He also made the Wära redeemable in coal. At the same time, he opened a shop in which the workers could spend their Wäras. Thus the Wäras derived their value directly from the goods in his shop. He had to pay for these in Reichsmarks, but as his coal was also paid for in Reichsmarks, this was no difficulty. The unemployed miners welcomed a chance to start work again, and all went well.

 

The miners’ wages had been the principal source of income in Swanenkirchen, and when the shopkeepers saw that they were all finding their way to Hebecker’s shop, they decided the only way to get their customers back was to accept payment in Wäras. They brought pressure to bear on the wholesalers to do so, too, and they in turn prevailed upon the merchants who supplied them. Soon everyone in that corner of Bavaria was buying and selling in Waras.

 

Swanenkirchen became prosperous. There was no unemployment. Commodities were obtainable. Debts were paid. Other villages saw this and wanted to share in the new prosperity. Even some banks agreed to accept Wäras.

 

But the Reichsbank (a central bank, Germany’s equivalent of the privately controlled Federal Reserve banks in the United States) frowned. The German government surrendered to the Reichsbank, and in November 1921, Wäras were made illegal.

 

The sensational success of the Wära made a deep impression on the Austrian side of the border, and, in December, the mayor of Worgl decided to follow the example set by Swanenkirchen. There was a great deal of unemployment and general distress. Taxes were in arrears and the streets and public buildings neglected. The mayor formed a committee, consisting of himself, the priest, the town treasurer and the commander of the garrison, to put the new money into circulation. They called it “Notgeld.”

 

They started work on a new town hall and a bridge over the river, both of which they paid for in Notgeld. The treasurer agreed to accept Notgeld in payment of taxes and used it to pay municipal creditors. At the end of the first year, the town was transformed: 100,000 schillings had been spent on pubic works. Everyone seems to have been happy-except the banks.

 

In January, 1933, the Austrian National Bank sued the mayor and town corporation for infringing its right to be the sole issuer of bank notes. The bank won, and the Notgeld was withdrawn.

 

We conclude that if currency, which need not (and probably should not) be based on any commodity, is properly issued and guarded against counterfeiting, with the limits of issue being firmly observed, and competing forms of money being forbidden, there is no reason why the notes should not only maintain their value, but might not in time advance to command a premium in terms of coins of like denomination. Once this object is shown to be capable of attainment, the use of other forms of money such as the debt-based Federal Reserve note and gold and silver coins would become just a memory of a more primitive past, and the road to true prosperity will lie open to all.

 

/more: http://www.aitup.org.za/

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LEGAL in the US? - Maybe

http://www.forbes.com/2006/02/11/local-cur..._0214local.html

 

Local currencies are an old idea. Thousands of them were used during the Great Depression, according to Bernard Lietaer, author of The Future of Money and a former currency trader who helped implement the euro. They're a subset of a grouping called complementary currencies, which also includes airline frequent-flier programs.

 

At present, local currencies don't affect the conventional economy--our dollar economy--much, because they have such limited circulation. Only $12,000 worth of Bay Bucks have been issued, for example, compared with some $700 billion worth of dollars. But the point of local currencies is also to boost the value of resources, such as local labor, that are undervalued in the dollar economy.

 

So are these things legal? Lewis Solomon, a law professor at George Washington University and author of a book about local currencies, says local currencies are legal with some stipulations, including that they have to be printed (not coined) and that local money cannot resemble dollars.

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LEGAL in the US? - Maybe

http://www.forbes.com/2006/02/11/local-cur..._0214local.html

 

Local currencies are an old idea. Thousands of them were used during the Great Depression, according to Bernard Lietaer, author of The Future of Money and a former currency trader who helped implement the euro. They're a subset of a grouping called complementary currencies, which also includes airline frequent-flier programs.

 

At present, local currencies don't affect the conventional economy--our dollar economy--much, because they have such limited circulation. Only $12,000 worth of Bay Bucks have been issued, for example, compared with some $700 billion worth of dollars. But the point of local currencies is also to boost the value of resources, such as local labor, that are undervalued in the dollar economy.

 

So are these things legal? Lewis Solomon, a law professor at George Washington University and author of a book about local currencies, says local currencies are legal with some stipulations, including that they have to be printed (not coined) and that local money cannot resemble dollars.

 

 

It seems there are many routes to this destination. I read that california is issuing IOUs to state employees and vendors, will this lead to a local currency there?

 

There is also a planned movement towards local currencies as part of the transition movement.

 

http://www.thepeterboroughexaminer.com/Art....aspx?e=1327215

 

 

A new currency, to be used only by Kawartha businesses, would boost local economy: advocate

 

The Peterborough region could issue its own currency, which could be called Kawartha bucks, as a way to encourage a more localized economy, the Transition Town Peterborough chairman says.

 

"That circulates the money and then keeps the wealth within the city," Fred Irwin told about 25 people at a town hall meeting at the Peterborough Public Library yesterday.

 

"What you do is localize the economy. You're no longer a consumer, you're a citizen."

 

Irwin gave an example of how the local monetary system could work.

 

He said the monetary exchange could distribute Kawartha bucks, or whatever the currency is called, through participating banks.

 

Residents could buy $1 in Kawartha bucks for 90 cents Canadian then use the local currency to purchase items or services at participating businesses, Irwin said.

 

Businesses could pay a fee to participate in the monetary exchange so they could exchange Kawartha bucks for Canadian currency, he said.

 

Anyone who wanted to exchange Kawartha bucks for Canadian currency -for example to go shopping in Toronto or outside the region - would receive 90 cents Canadian for $1 in Kawartha bucks, or lose 10 per cent, Irwin said.

 

The money put in the bank through the purchase of Kawartha bucks would be placed in a nonprofit, charitable trust that would be used for purposes such as providing incentives for people in the community to reduce energy use through eliminating hot water tanks or replacing gasoline-guzzling SUVs, he said.

 

Cities around the world are issuing their own currency, Irwin said.

 

"Everything is based on trust," he said. "We'd all trade with each other."

 

Continued After Advertisement Below

 

Advertisement

 

The local monetary exchange could reject businesses such as Costco and Wal-Mart and possibly accept companies such as Canadian Tire and Shoppers Drug Mart, Irwin said.

 

A monetary exchange is one of several ways to encourage economic localization, Irwin said.

 

He also talked about reducing dependence on energy, community gardens and training people for new skills.

 

The British-based Transition Towns network named Peterborough Canada's first Transition Town in October, Irwin has said.

 

There are 120 cities listed on Transition Towns website as official initiatives. The organization's main objective is to respond to the opportunities and challenges of tackling peak oil and climate change.

 

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There is also the well known, it carries a pictures of Thomas Paine which I think is fantastic

 

Lewes Pounds - New British Currency

 

‘A local currency for local people’ - The Friar

 

http://friarforex.com/?p=287

 

The town of Lewes in East Sussex is printing it’s own currency, known as the Lewes pound. The currency is being produced by the local council in a bid to keep cash circulating in the local economy rather than losing money to the national stores and hence protecting the local economy from globalization. More than 70 stores in Lewes have signed up to accept the Lewes pound in their transactions.

 

The town have printed £10,000 worth of the new currency, which was an idea put forward by the Transition Town Lewes, which are a local developmental organization. The currency was printed on Royal Mint quality paper, with security features like UV fibres and watermarks.

 

People may think that this is a new fad, but historically it wasquiet common in 19th century Britian for towns or areas to have their own currencies, in fact Lewes previously had it’s own currency until 1895.

 

The Lewes pound has replaced the image of the Queen with that of Thomas Paine on it’s notes. Paine lived in Lewes and moved to the United States where he famously wrote the influential Rights of Man. The new currency can be bought for pounds sterling at outlets around Lewes, and can be exchanged back to pounds sterling at any time.

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"Residents could buy $1 in Kawartha bucks for 90 cents Canadian then use the local currency to purchase items or services at participating businesses, Irwin said.

 

Businesses could pay a fee to participate in the monetary exchange so they could exchange Kawartha bucks for Canadian currency, he said.

 

Anyone who wanted to exchange Kawartha bucks for Canadian currency -for example to go shopping in Toronto or outside the region - would receive 90 cents Canadian for $1 in Kawartha bucks, or lose 10 per cent, Irwin said."

 

THE GERMAN Community Currencies were set up to lose value over a year, in order to encourage people to spend them.

I think they should sell them for $0.95, and redeem them only at $0.90 or $0.92, to encourage people to spend them.

 

If I were a merchant, I would only accept them for a part of the purchase price, like 25-50%

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LEGAL in the US? - Maybe

http://www.forbes.com/2006/02/11/local-cur..._0214local.html

 

Local currencies are an old idea. Thousands of them were used during the Great Depression, according to Bernard Lietaer, author of The Future of Money and a former currency trader who helped implement the euro. They're a subset of a grouping called complementary currencies, which also includes airline frequent-flier programs.

 

At present, local currencies don't affect the conventional economy--our dollar economy--much, because they have such limited circulation. Only $12,000 worth of Bay Bucks have been issued, for example, compared with some $700 billion worth of dollars. But the point of local currencies is also to boost the value of resources, such as local labor, that are undervalued in the dollar economy.

 

So are these things legal? Lewis Solomon, a law professor at George Washington University and author of a book about local currencies, says local currencies are legal with some stipulations, including that they have to be printed (not coined) and that local money cannot resemble dollars.

 

Tax

 

On page 226 Bernard lists 3x different possible attitudes to complementary currencies:

1. Passive tolerance

2. Mildly supportive

3. Strongly supportive.

 

He says NZ and more than 30 states in the US have gone for the Mildly supportive option.

He says the UK is moving in this direction.

He says NZ & US have funded startup projects.

 

"The US went one step further by having the IRS rule that any income in Time Dollars is automatically tax-exempt".

 

He lists Japan as Strongly supportive, funding systems.

 

"They justify it because it reduces the need for other Yen-based expenses, and provides better service as well".

 

He mentions Time Dollars and tax back on page 189, and on page 191 he mentions the use of Time Dollars in Gloucestershire UK, Newcastle and Lewisham, and Watford. That's Watford Council !!!!

 

He lists so many example. This dispels any idea that this idea is in any way radical or marginal.

 

His main bit of tax in on page 214.

This is where the section I typed out is on page 217.

 

He says:

 

"A general rule is that it is not the currency used which determines whether a transaction is taxable, but the nature of the transaction itself".

Tax is due in the legal tender national currency.

 

I should also mention that he talks about the use of the national currency at the same time as the complementary currency.

So you might pay for the grass seed in US$, but for the labour to sow it in Time Dollars.

 

Japan seems to have one of the most advanced dual currency payment systems listed, which matches their obvious positive attitude to it, which Bernard says is related to the state of their economy, and the demographic problems they have, and which we will all have to face.

That is why complementary currencies are mentioned so often in relation to older people.

 

I have little time at present, but it's good to see this topic being aired :D :D

 

I am buying a book by a Kiwi lady on this, and am in contact with another lady in NZ who met Bernard in 2003.

There's quite a little underground movement going on :D

 

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Another Experiment - from the Austrian thread

 

During the 1970s the Sweeneys were members of ... an association of young couples ... who were willing to baby-sit each other’s children. This particular co-op was unusually large, about 150 couples, which meant not only that there were plenty of potential baby-sitters but also that managing the organization ... was not a trivial matter. ... the Capitol Hill co-op dealt with the problem by issuing scrip: coupons entitling the bearer to one hour of baby-sitting. When babies were sat, the baby-sitters would receive the appropriate number of coupons from the baby-sittees.

 

This sounds foolproof, but an imbalance overthrows the system. In the winter, most parents want to accumulate coupons: that way, they are able to go out in the summer without having to worry about babysitting. In winter, almost everyone wants to babysit, but few people want to go out then. The attempt to accumulate coupons fails.

 

Fortunately, a simple solution unblocks the impasse: “The supply of coupons was increased. The results were magical: with larger reserves of coupons couples became more willing to go out, making opportunities to baby-sit more plentiful, making couples even more willing to go out, and so on.”

 

This charming tale, Krugman thinks, helps us to understand economic crises and what to do about them. Just like the babysitters trying to amass coupons, an attempt by everyone to hold money will fail. If the demand to hold money is high enough, a “liquidity trap” ensues. Investment will fall into a tailspin, no matter how low the rate of interest. The government must therefore pump in more money, as John Maynard Keynes prescribed. In the bad old days, benighted economists such as Joseph Schumpeter thought that failing businesses should be allowed to collapse in a depression. Now we know better, writes Krugman: “Before World War II, policymakers, quite simply, had no idea what they were supposed to be doing. Nowadays the whole spectrum of economists, from Milton Friedman leftward, agrees that the Great Depression was brought about by a collapse of effective demand and that the Federal Reserve should have fought the slump with large injections of money.”

 

Krugman’s parable of the tiny tots omits an important fact, however. Issuing more coupons did indeed solve his problem, but another answer would have done at least as well. When people found themselves unable to satisfy their demand for coupons, they could have offered to babysit for fewer coupons. They would thus bid up the price of coupons, and the price of baby-sitting would fall. If quantity of a good demanded exceeds supply offered at a given price, elementary economics tells us that the price will need to go up.

UNQUOTE

 

But people generally resist the need to cut wages.

They may do it once or twice, but repeated cuts are painful

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How about a Virtual Currency, for a gaming website

http://www.gameusd.com/world-of-warcraft-item.htm

 

WOW is the best known, I am told

wow-gold-12.gif

 

Others have performed less well

eq2-gold-12.gif

 

The trend has not been the friend of online gamer FX

everquest-2-gold.gif

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(Steve NW suggested this link: Paper Money )

 

EXCERPT

Paper Money in Asia

The first well-documented widespread use of paper money was in China during the Tang (618-907 A.D.) dynasty around 800 A.D.[1] Paper money spread to the city of Tabriz, Persia in 1294 and to parts of India and Japan between 1319 to 1331. However, its use was very short-lived in these regions. In Persia, the merchants refused to recognize the new money, thus bringing trade to a standstill.

 

KuanNote.jpg

Figure 1. This Kuan note is the oldest known banknote in the world. It was made in China circa 1380.

 

By 1455, after over 600 years, the Chinese abandoned paper money due to numerous problems of over issuance and hyperinflation. An in-depth description of China's first experience with money can be found here: http://dollardaze.org/blog/?post_id=00420

 

 

LONGEST SURVIVING CURRENCIES

 

Currency============== Inception Years of Circulation Status

Pound Sterling (GBP)............... 1694 315 In circulation

Scotland Pound (SSP).............. 1727 282 In circulation*

US Dollar (USD)...................... 1792 217 In circulation

Netherlands Guilder (NLG)........ 1814 188 EURO (2002)

Swiss Franc (CHF)................... 1825 184 In circulation

Guernsey Pound Sterling (GGP) 1827 182 In circulation*

Mexico Silver Peso (MXP)......... 1822 170 Destroyed by hyperinflation in 1992

Canadian Dollar (CAD)............ 1841 168 In circulation

Belgian Franc (BEF)................. 1835 167 EURO (2002)

Cuban Peso (CUP)................... 1857 150 In circulation*

India Rupee (INR)................... 1861 148 In circulation

Manx Pound (IMP).................... 1865 144 In circulation*

 

/see: http://dollardaze.org/blog/?post_id=00405

 

 

 

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(From GEI poster Injun's Blog on Bartering and Alternative currencies):

 

In Totnes TTT gave away 300 notes at a public meeting in March.

 

Marjana Kos, of TTT, said: "It's keeping wealth here. It's keeping local trade alive and supporting local businesses. Louise King, manager of the Riverford farm shop in Totnes, said: "We like our own products, so it just seems right to have our own currency."

 

What might seem like criminal activity is actually perfectly legal - the notes were copies of a pound note last in circulation in 1810. Paul Hall, of Colourworks, which printed the notes, said: "We thought it was a little bit strange, printers aren't usually asked to produce currency, but once it was explained that it was a reproduction of a Totnes pound as opposed to a Bank of England pound, we were happy to do that.""

 

Full story and video here - http://news.bbc.co.uk/1/hi/england/devon/6692755.stm

 

http://injinsalternativeuniverse.blogspot.com/

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...

The first well-documented widespread use of paper money was in China during the Tang (618-907 A.D.) dynasty around 800 A.D.

...

Figure 1. This Kuan note is the oldest known banknote in the world. It was made in China circa 1380.

...

 

LONGEST SURVIVING CURRENCIES

 

Currency============== Inception Years of Circulation Status

Pound Sterling (GBP)............... 1694 315 In circulation

 

Looks like someone at dollardaze needs to study history.

 

Sterling goes back a lot longer that, the BoE was created in 1694 not the Pound Sterling. Sterling goes back to the 12th century and the pound to the Roman invasion. The 1 Kuan note is also not the oldest known banknote in the world the 1 Kaun Tang dynasty is the oldest known. The oldest surviving banknotes are from the Yuan dynasty, the dynasty before the Ming, and are in the State Hermitage Museum in Russia.

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