Private currencies

[djm]

After WW2 a few towns in Austria issued their own currency, to stimulate the local economy. They declined in value with age, which encouraged people to spend rather than save and the project was very successful. So successful that the government promptly banned them plunging the towns back into the economic doledrums.

I am visiting Germany tomorrow, and whilst browsing the net for info on one of the towns I am travelling to (Magdeberg) I cam accross this:

http://news.bbc.co.uk/1/hi/world/europe/6333063.stm

It seems local currency is making a comeback (well in certain cases it never went away). The Urstromtaler is an interesting initiative, I think there will be more examples of this in the near future. Governments will not like this sort of thing, it threatens them, I expect the EU to regulate them sooner rather than later.

Thoughts?

[mancroft]

They have got something like that in Lewes, Sussex. http://www.thelewespound.org/

i suppose it is a good idea - until the government cracks down.

If the government allows it to continue, I would have suspicions about their motives. After all, Lewes is one of these Transition Towns: http://transitiontowns.org/Lewes/Lewes

The idea behind Transition Towns and "sustainable development" is not as benign as it appears: http://video.google.com/videoplay?docid=9144262448312647167&hl=en

[thod]

They will close them down. I recall schemes where you would earn your credits somehow and when you wanted say a plumber you would pay him in like credits. Thus you have a mini economy within an economy. However no national currency was changing hands and thus no income tax was being paid. They want you to pay that plumber in currency so that they can tax him. They stamp them out real fast once they get beyond a certain size.

[Ferrus]

In the US it is illegal, here it is a grey area. Of course, there was once a time when to some extent all currency was private, and yet supranationally recognised too, but then it had gold value which tied it more firmly to physical currency.

The main problems are:

How this fits in with existing legal systems, especially with regard to contract law.

How the currency and its real value will be regulated and enforced. Hyperinflation and mass-printing are obviously a risk.

Of course for those with a limited range of uses - such as amount to little more than local barter - these problems don't present themselves, as the armies and their scrip have proven.

[djm]

Tesco clubcard points are quite possibly worth more annualy than some European economies. Supermarket reward points are a defacto scrip currency, somewhat akin to Arkwrights food tokens. The government has access to all your shopping information though, so they can spy on you for potential tax evasion.

[Ferrus]

Tesco clubcard points are quite possibly worth more annualy than some European economies. Supermarket reward points are a defacto scrip currency, somewhat akin to Arkwrights food tokens. The government has access to all your shopping information though, so they can spy on you for potential tax evasion.
Yes, of course, as I said for bartering purposes I see no problems with private currencies - the real dodgy area would be if banks, large financial institutions and big private investors were to be involved. The world of high finance is anarchic enough as it is.

[djm]

Well I have to say my faith in the BBC has been shaken. Not only did I not see this currency in Magdeburg, I could not find anyone there that had heard of it (they thought I was crazy).

[kuranes]

There's an artist who issues his own currency. People can use it to buy art from him or from each other, if they are part of the system. He is the king of an "imaginary" country. :)

[Ferrus]

Well I have to say my faith in the BBC has been shaken. Not only did I not see this currency in Magdeburg, I could not find anyone there that had heard of it (they thought I was crazy).
Perhaps it was a certain part of the city or certain occupations?

[djm]

There's an artist who issues his own currency. People can use it to buy art from him or from each other, if they are part of the system. He is the king of an "imaginary" country. :)

That sounds rather fun, is his art any good? I am king of djmitania, the nation that exists in a two foot radius of wherever I go :) Unfortunately it is as yet unrecognised by it's nasty imperialist neighbors, perhaps I should get a Russian passport and appeal for aid.