In a reply to Don’s lament about petrodollars Tina quoted a generic CBS news writer on the slow disappearance of actual physical money. Once upon a time BCC, before credit cards, transactions were conducted with a physical representation of exchange value, money. “Even the tooth fairy dealt only in cash.” Just as substantial gold was replaced by less substantial paper, so now is paper being replaced by even less substantial bits of magnetism. No pun intended.
Yesterday I attended my new alderman’s community visioning meeting to create a ward-wide master plan. I went with the intention to make two pitches. The first was for a system of representing opinion by revocable delegation (here and here) and the second was for setting up our own local currency (see Cyclos here). I had gotten the notion from a Guardian article about a Greek town essentially forced to do what their government was no longer able to do, create their own currency.
Bank of England’s governor Mervyn King:
”œIs it possible that advances in technology will mean that (…) the world may come to resemble a pure exchange economy? Electronic transactions in real time hold out that possibility. There is no reason, in principle, why final settlements could not be carried out by the private sector without the need for clearing through the central bank. (…) There is no conceptual obstacle to the idea that two individuals engaged in a transaction could settle by a transfer of wealth from one electronic account to another in real time. (…) The same system could match demands and supplies of financial assets, determine prices and make settlements. Financial assets and real goods and services would be priced in terms of a unit of account. Final settlement could be made without any recourse to the central bank.(…) Without such a role in settlements, central banks, in their present form, would no longer exist; nor would money.”
Actually the notion has been kicking around my bran since the seventies. But the biggest stumbling block was always counterfeiting. Again quoting from the Tina find:
“Everyone thinks cash is so simple and so easy and so fast and so secure. It’s NONE of those things,” said author David Wolman. In his new book, “The End of Money,” he argues the biggest knock against cash is that it’s costly.
“It’s really expensive to move it, store it, secure it, inspect it, shred it, redesign it, re-supply it, and round and round we go!” Wolman said.
Just a few years ago I would have not opened my mouth pushing for our own local currency. But now with open-source software available and the increasing functionality of merchants and professionals to receive and spend electronic money, not to mention the growing ubiquity of striped cards that hold value, well the time has come. Just imagine, if you are a Keynesian or even an MMTer (Modern Monetary Theorist), you can now put your money where your mouth is.
Not ready to give up on the dollar but hate feeding banks excessive credit card fees? Try Dwolla.