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Mira currency powerpoint oct 2012


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Revised, shorter community currency powerpoint used for NASCO Institute

Published in: Economy & Finance
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Mira currency powerpoint oct 2012

  1. 1. Community Currencies “Banking institutions are more dangerous to our liberties than standing armies...The issuing power should be taken from the banks and restored to the people, to whom it properly belongs." - Thomas Jefferson “Let me issue and control a nation’s money and I care not who writes the laws.” - Banker Mayer Amschel Rothschild "...official money malfunctions in three ways: It is kept artificially scarce; it is misallocated at its source; and it systemically pumps wealth from other classes to the rich through "the debt trap." --Suzanne Phillips, The "Banksters" "The present dominant structure of money and finance, by their very nature, promote the concentration of power into fewer and fewer hands, increase disparities in the distribution of wealth, channel a huge portion of the earths resources into wasteful production, and force both social and ecological degradation." --Masaki Nakagome, Aoyama-Gakuin University, Tokyo “If we are to make money into something sacred, nothing less than a wholesale revolution in money will suffice, a transformation of its essential nature. It is not merely our attitudes about money that must change... rather, we will create a new kind of money that embodies and reinforces our changed attitudes.” – Charles Eisenstein
  2. 2. What is federal money? “I define money, or currency, as an agreement within a community to use something as a medium of exchange. It’s therefore not a thing, it’s only an agreement – like a marriage, like a political party, like a business deal. And most of the time, it’s done unconsciously.” -Bernard Leitaer, designer of the Euro and many community currencies US “dollars” are issued by the Federal Reserve, an organization of private banks, as debt (mortgages and loans) with interest out of thin air The Federal Reserve is independent within government in that "its monetary policy decisions do not have to be approved by the President or anyone else in the executive or legislative branches of government." Less than 2% of money is actually used for trading goods and services, the rest is speculation. The value of money is due to the peoples consent to use it as an agreement and to its scarcity
  3. 3. Babylonian warehouse receipt 4000 BC, Iranian clay currencies 3500 BC
  4. 4. Electronic Bank Account
  5. 5. Functions of Money Measure of value, standard equivalency Means of exchange Means of saving/storage Means of investment, credit, speculation
  6. 6. What is a Community Currency? means of exchange that has a localized value, usually restricted within a geographical region or between people with specific community connections or interests represents agreements that acknowledge trust in the community itself, rather the federal government, big banks, or corporations and used to support manifestation of community values takes many forms: online accounting, tokens, paper bills, plastic cards, metal, checkbooks
  7. 7. Why Community Currencies? Can be used to support progressive and radical activist and social work where money is not available Supports relationship and community building, mutual aid, trust and security Can create a culture of abundance rather than scarcity Recreates a local or bioregional economy that is suited to its ecology and community needs. Links unmet needs with otherwise unused resources Keeps the wealth created by the exchange of goods and services within the local community (multiplier effect) Community autonomy, self-determination, resiliency and sufficiency Insulates communities from the roller-coaster market economy Protest against unfair and unsustainable global economy
  8. 8. Types of Currencies Mutual Credit: LETS (Local Employment Trading Systems), Business to business bartering exchanges, Timebanks Monetary equivalent notes and debit cards Rewards/loyalty currencies Business pre-pay scrips Community service scripts Hybrids Reputation and gift currencies
  9. 9. Basis of Issuance & Backing Voluntary Labor Business goods and services US dollars Commodities Collateral (e.g. real estate) Issuing authority, similar to Federal Reserve
  10. 10. Mutual Credit SystemsName Previous Change Current amount amountAndy +10 -25 -15Betty +5 0 +5Charly -15 +25 +10Total 0 0 0
  11. 11. Red de Trueque, Argentina
  12. 12. Banco Palmas, Brazil
  13. 13. Banco Palmas, Brazil A community bank in Fortaleza, Ceará, Brazil since 1998 issuing credit cards, home loans, consumer loans, grants and paper currency as microcredit, through purchase or directly earned through work Banks are opened with an initial donation in Reales with an equivalent amount created in Palmas For a fee of 1%, amounts in local currency can be swapped with the national currency (ratio 2:1) The bank offers credits in the local currency (interest-free) and in Brazils national currency (interest rate 2%) Interest rates on microcredits are much lower than Reales (Brazil’s currency), enabling people with limited income to start up their own business Scrip and plastic card issued in equivalence to Brazilian Real Managed by neighborhood association, community members Has created 1200 jobs and many public works projects Some people live entirely off Palmas rather than Reales Over 50 similar initiatives in Brazil and a few in other countries Supported by the Central Bank of Brazil
  14. 14. Chiemgauer, Germany
  15. 15. Chiemgauer, Germany Network of 30 REGIO (regional currencies) projects throughout Germany started by high-school students with their professor in Jan 2003 1300 individual and 600 business members, 5 district offices and 50 issuers Goal is to improve local purchasing power and bind currency to local district, thereby increasing flow and reducing leakage of wealth, and reduce emissions from transport €-backed paper and card keeps wealth within the region that already has strong local economy and can create good circulation loops ~C560,000 (=€560,000) in circulation, increasing local businesses’ turnover (about 4 million Chiemgauer/year), C100,000 bought/month, 70% spent again and not immediately redeemed for =€ Chiemgauer office sells C100 at 97 euro to other non-profits.Local non-profits sell C100 at 100 euro to their members, earning 3 euro to be spent for own activities Local businesses spend C100 to other local businesses or redeem 95 Euro, and the difference of 2 euro will be spent to cover the administrative cost of Chiemgauer office, 3% to nonprofits Demurrage (negative interest) incorporated- 2%,quarter, 8%,year, stamp purchase to validate Kits for provided for business accounting Facilitates import replacement- local apple growing increasing to fulfill supply chain Limited by ability to purchase Chiemgauers with Euros
  16. 16. Ithaca Hours, NY
  17. 17. Ithaca Hours, NY Started in 1991 in by Paul Glover Over 900 businesses, thousands of individuals accept HOURS Over $120k worth of hours issued, estimated trade facilitation in the millions. Issued by fiat of Ithaca Hours Circulating Committee Unit of account is HOUR, equivalent to living wage of $10, all hours are not necessarily equal New HOUR notes are issued as disbursements to those who pay for a listing in the directory or renew membership, loans to participants,small business at no interest, as small grants to community organizations and a limited number issued to help cover basic system expenses Some local business employees paid partially in hours Local public transit authority accepts hours for bus fare Individuals like the idea of calculating a fair wage in hours Businesses especially have difficulty accounting in hours, even though tied to $10 living wage
  18. 18. Legal Considerations Complementary currencies are legal within certain parameters Must not be easily confused with $USD Must be able to calculate a conversion to $USD for tax purposes if taxable Standard employment and sales tax laws may apply, as they apply to cash and electronic account transactions Systems may be required to provide tax reports to users and to IRS (esp. business to business systems) Timebanks received tax exemption status- considered nontaxable charitable volunteering system No denomination at a fraction of $USD (e.g. 25 cents) Metal coins are legal grey area If they become too big, the federal government may tighten laws to restrict their use Securities laws may apply to some business scrips Employees can not be forced to accept alternative currency See “Rethinking Our Centralized Monetary System”, as well as Katovich Law in Oakland (Jenny Kassan) and Janelle Orsi in Berkeley
  19. 19. Currency Design (edited by Luna - Community Currency Guide, Leitaer & Hallsmith) Set Currency Objectives: Do an assessment of your community to identify the priorities for goals, target users, and matching unmet needs with underutilized resources – this will determine the objective of the complementary currency project you want to implement. Choose the Appropriate Currency: Review the different types of complementary currencies that are available, and choose the type that suits your goals and your community context best. Develop Leadership and Good Governance: Build support for the community currency system, which means finding a group who can help with the different aspects of the project and represent different sectors of participants. Choose the Right Mechanisms: Establish a system for managing transactions in your community, which includes considerations of the support medium, standard of value, store of value, issuing procedures, and cost recovery. This system can take many forms, depending on the local resources available, the scale of the project, the type of participants, and the type of currency you select. Establish a Circulation System: Carefully design the exchange process and circulation system so that the money keeps moving throughout the community and doesn’t stagnate or pool discourage participants. Draw a circulation map of your local economy, fill in the gaps. Have volunteers actively facilitate exchanges through direct match-making, events, directory, newsletter, etc. Design a sustainable funding mechanism: Through transaction fees, labor donations, membership fees or other means in national or local currency.
  20. 20. Addressing Challenges Business/ nonprofit participation- make it easy to use and useful Community buy in- address community needs and goals; multi- stakeholder participation in design, planning and governance; link to reputable nonprofit, local business or local government; focus groups; build a big store before you open it; transparency and accountability Circulation- facilitate exchange connections, community building, swapmeets, diverse recruitment of needed businesses and import replacement. Match unmet needs with underused resources. Limit flows of currency into bottlenecks Consciousness- public education about monetary system and functions and benefits of currencies through events, media, etc. Cost of administration- grants, member or transaction fees, pay in community currency, minimize administration, electronic forms
  21. 21. Key Points to Remember Currency must have value- purchasing power, advertising/promotional value, ideological value, community- building, etc. Must be relatively easy to use as compared to conventional forms Identify and reduce barriers to participation as much as possible Meet unmet needs with underutilized resources Facilitate circulation loops- help people find places to spend currency and fill in gaps Different currencies systems and features address different goals and contexts better- pick the one that addresses your top goals 1st Create partnerships with and ask for feedback from reputable organizations
  22. 22. ResourcesOnline Resources: Community Currency Magazine Magazine Community Currency - from Good Idea to Sustainable System by John Rogers Community Currency Guide by Hallsmith and Leitaer Complementary Currency DatabaseBooks: People Money: The Promise of Regional Currencies by Kennedy, Lietaer, & Rogers Local Money: How to Make it Happen in Your Community by Peter North Creating Wealth: Growing Local Economies with Local Currencies by Hallsmith and Lietaer The End of Money by Tom GrecoFilms: The Money Fix The Double Face of Money