Comments on: Towns to drive local economy with own currency http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/ An Evolving Exploration into the Head, Heart and Hands of Energy Descent Fri, 19 Mar 2010 23:18:13 -0400 http://wordpress.org/?v=2.8.6 hourly 1 By: james greyson http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/comment-page-1/#comment-60597 james greyson Sun, 07 Dec 2008 14:59:07 +0000 http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/#comment-60597 Jane, it's not so much crackers as Christmas crackers! Local currencies are a fun way for any place to celebrate what it has to offer. Those places which have got sucked into the illusion that they have nothing of interest and that they must buy in everything from far away seem to me most in need of it. Time to pull apart obsolete ideas about money and discover the novelties within. Jane, it’s not so much crackers as Christmas crackers! Local currencies are a fun way for any place to celebrate what it has to offer. Those places which have got sucked into the illusion that they have nothing of interest and that they must buy in everything from far away seem to me most in need of it. Time to pull apart obsolete ideas about money and discover the novelties within.

]]> By: Jane Thomas http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/comment-page-1/#comment-57437 Jane Thomas Thu, 15 May 2008 09:39:56 +0000 http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/#comment-57437 <p>What a crackers idea! And how is this helping the environment, to produce yet more currency? Whilst some tourists coming to the area might find it a novelty, others will simply drive straight through. No way do I want to be paid in a local currency, thank you, seeing as the place where I work is a small rural town with nothing of interest to purchase.</p> What a crackers idea! And how is this helping the environment, to produce yet more currency? Whilst some tourists coming to the area might find it a novelty, others will simply drive straight through. No way do I want to be paid in a local currency, thank you, seeing as the place where I work is a small rural town with nothing of interest to purchase.

]]> By: james greyson http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/comment-page-1/#comment-57270 james greyson Thu, 01 May 2008 09:57:00 +0000 http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/#comment-57270 <p>Hi Iain HM Revenue seem to use the term local currency to describe a national currency when discussing international finances. I've not heard of any reference to their thinking and rules for really local currencies, just rumours. If anyone knows of a reference please tell me through my site (click on my name).</p> <p>Registration of local schemes seems sensible. A 1-1 exchange seems arbitrary and unlikely to be defined in law. If it's just a technical regulation then it could be changed when a handful of civil servants and a minister are persuaded that flexible exchange is needed to run a scheme able to leverage spending in sterling and thus to boost both local and national economic activity. Perhaps just a conversation with HMRC or if necessary excercising the Sustainable Communities Bill.</p> <p>Am currently busy at the other end of economics (see my UN site at http://www.climateneutral.unep.org/cnn_members.aspx?m=195) but would be keen to chat with anyone considering approaching HMRC or setting up a scheme along the lines envisaged above. Seems to be an opportunity for a well designed local scheme to serve as a case study for use globally.</p> Hi Iain
HM Revenue seem to use the term local currency to describe a national currency when discussing international finances. I’ve not heard of any reference to their thinking and rules for really local currencies, just rumours. If anyone knows of a reference please tell me through my site (click on my name).

Registration of local schemes seems sensible. A 1-1 exchange seems arbitrary and unlikely to be defined in law. If it’s just a technical regulation then it could be changed when a handful of civil servants and a minister are persuaded that flexible exchange is needed to run a scheme able to leverage spending in sterling and thus to boost both local and national economic activity. Perhaps just a conversation with HMRC or if necessary excercising the Sustainable Communities Bill.

Am currently busy at the other end of economics (see my UN site at http://www.climateneutral.unep.org/cnn_members.aspx?m=195) but would be keen to chat with anyone considering approaching HMRC or setting up a scheme along the lines envisaged above. Seems to be an opportunity for a well designed local scheme to serve as a case study for use globally.

]]> By: Iain Davidson http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/comment-page-1/#comment-57265 Iain Davidson Wed, 30 Apr 2008 20:24:22 +0000 http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/#comment-57265 <p>Hi James,</p> <p>Nice idea and...</p> <p>My understanding is that "local" currencies in the UK have to be registered with the Inland Revenue and as part of this registration/permission to circulate the notes, there has to be a 1-to-1 exchange with sterling. We are trying to find a way to excite more interest in our own currency (we are about 500 people so around the minimum size for an alternative currency) including using a discount scheme...</p> Hi James,

Nice idea and…

My understanding is that “local” currencies in the UK have to be registered with the Inland Revenue and as part of this registration/permission to circulate the notes, there has to be a 1-to-1 exchange with sterling. We are trying to find a way to excite more interest in our own currency (we are about 500 people so around the minimum size for an alternative currency) including using a discount scheme…

]]> By: james greyson http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/comment-page-1/#comment-57222 james greyson Sun, 27 Apr 2008 10:56:46 +0000 http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/#comment-57222 <p>Great stuff, every area should have its own local money or LETS scheme. Not convinced though about the wisdom of a flat exchange rate to seek the 'backing' of a national currency. Looks like many 'play now pay later' economies are unravelling so tying local money to national currency is like lashing the liferaft to the sinking ship. National currencies don't seem to be backed by anything besides people's belief that they're worth something. The fading value of the pound shows that faith in currencies cannot be taken for granted. If one day international banking loses its magical powers then it would be nice if local currencies were able to step forward until regular economics could be taken seriously again. These local currencies would be backed not by national money but by trust in local people's promises to pay and in the value created by local efforts. So why not say already now that's the backing?</p> <p>Generating a local money supply by 1 for 1 exchange with regular money is nice and simple for pilot schemes but with a little more thought you could do much more. For example why not sell local money for the first 3 months for half the face value, to kick start a new scheme? Then sell it for 3/4 face value which gives a permanent discount advantage to local over regular money. Redeem local money at 1/2 face value, which gives an incentive to circulate local money rather than cash it in.</p> <p>Hey presto you've got a neat local shopping loyalty scheme. The public could buy one local note for 75p (or earn it), then spend it in a participating shop to get a £1 discount on a £10 purchase. The shop could redeem it for 50p, so they give just a 5% discount in order to attract more business and fight the supermarkets. The currency scheme makes a small profit which provides capital investment in local projects such as food, energy, energy saving, composting and refurbishment.</p> <p>It gets better... People working on these projects could be paid partly in local money which is self generated in the same way as banks create money from the interest on their loans. Except this time it's not the banks that profit, it's the whole local economy. Local food, energy, skills, services and products could be sold for blends of local and national money. The currency scheme, shops and individuals would all be trading with each other, either with locally printed notes or cards and mobile text messages. A web-based directory of products and services would help people find whatever they need.</p> <p>One final advantage of not lashing the currency to sterling would be to play with the name. This could reinforce how the values of a local community are not the same as the invisible global marketplace. My favourite is Thanx, where each note symbolises the appreciation offered in return for someone's help. It also reminds the government that local money is predominantly about social favours; only taxable trades should be taxed, not the whole show. When the government starts to realise that local money can leverage greater spending in regular money they will see it as a way to boost growth. Who knows, now that the 'peak everything' crunch is getting obvious enough even for them, they might some day start to help a bit?!</p> Great stuff, every area should have its own local money or LETS scheme. Not convinced though about the wisdom of a flat exchange rate to seek the ‘backing’ of a national currency. Looks like many ‘play now pay later’ economies are unravelling so tying local money to national currency is like lashing the liferaft to the sinking ship. National currencies don’t seem to be backed by anything besides people’s belief that they’re worth something. The fading value of the pound shows that faith in currencies cannot be taken for granted. If one day international banking loses its magical powers then it would be nice if local currencies were able to step forward until regular economics could be taken seriously again. These local currencies would be backed not by national money but by trust in local people’s promises to pay and in the value created by local efforts. So why not say already now that’s the backing?

Generating a local money supply by 1 for 1 exchange with regular money is nice and simple for pilot schemes but with a little more thought you could do much more. For example why not sell local money for the first 3 months for half the face value, to kick start a new scheme? Then sell it for 3/4 face value which gives a permanent discount advantage to local over regular money. Redeem local money at 1/2 face value, which gives an incentive to circulate local money rather than cash it in.

Hey presto you’ve got a neat local shopping loyalty scheme. The public could buy one local note for 75p (or earn it), then spend it in a participating shop to get a £1 discount on a £10 purchase. The shop could redeem it for 50p, so they give just a 5% discount in order to attract more business and fight the supermarkets. The currency scheme makes a small profit which provides capital investment in local projects such as food, energy, energy saving, composting and refurbishment.

It gets better… People working on these projects could be paid partly in local money which is self generated in the same way as banks create money from the interest on their loans. Except this time it’s not the banks that profit, it’s the whole local economy. Local food, energy, skills, services and products could be sold for blends of local and national money. The currency scheme, shops and individuals would all be trading with each other, either with locally printed notes or cards and mobile text messages. A web-based directory of products and services would help people find whatever they need.

One final advantage of not lashing the currency to sterling would be to play with the name. This could reinforce how the values of a local community are not the same as the invisible global marketplace. My favourite is Thanx, where each note symbolises the appreciation offered in return for someone’s help. It also reminds the government that local money is predominantly about social favours; only taxable trades should be taxed, not the whole show. When the government starts to realise that local money can leverage greater spending in regular money they will see it as a way to boost growth. Who knows, now that the ‘peak everything’ crunch is getting obvious enough even for them, they might some day start to help a bit?!

]]> By: Iain Davidson http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/comment-page-1/#comment-56999 Iain Davidson Thu, 03 Apr 2008 19:45:21 +0000 http://transitionculture.org/2008/04/03/towns-to-drive-local-economy-with-own-currency/#comment-56999 <p>Great to hear that a group of towns are looking at sharing one local currency! Here at the Findhorn Foundation Community we are on the 3rd edition of our local currency, the Eko, which comes in £E1, £E5, £E10 and £E20 denominations. As well as keeping the trade local, it is estimated to save local businesses around £1,000 a year in bank fees alone.</p> <p>Of course this still pales into insignificance with the size of the BerkShares - wow over a $million - that's serious ;-))</p> Great to hear that a group of towns are looking at sharing one local currency! Here at the Findhorn Foundation Community we are on the 3rd edition of our local currency, the Eko, which comes in £E1, £E5, £E10 and £E20 denominations. As well as keeping the trade local, it is estimated to save local businesses around £1,000 a year in bank fees alone.

Of course this still pales into insignificance with the size of the BerkShares – wow over a $million – that’s serious ;-) )

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