NationStates Jolt Archive

I stumbled across this video today:

http://www.cnn.com/2009/LIVING/wayoflife/04/22/printing.own.currency/index.html#cnnSTCVideo

So what does NSG think of this local currency idea? I think it's foolish, only because I have no idea what it's backed by (Dollars I guess?). At least the liberty dollar (http://www.libertydollar.org/) is backed by gold and silver.

It doesn't look much different than the multi-retailer gift cards that shopping malls and restaurant chains sell these days. I can see where it might help out local businesses, and if the novelty gets people thinking about their consumption patterns, then so much the better. Since it clearly doesn't aim to replace the dollar, I don't think its "backing" is much of an issue.

Local currencies provide a short term boost to the economy, by increasing domestic consumption. Long term they have no effect.

This is a Schrute buck.

http://www.dualityentertainment.com/mike/MISC/Buck.jpg

So what does NSG think of this local currency idea? I think it's foolish

Yes it's completely idiotic. Luckily here printing currency is State monopoly.

Foolish. Idiotic. Any number of synonyms that mean the same or have similar meanings. What would they even back them with?

Foolish. Idiotic. Any number of synonyms that mean the same or have similar meanings. What would they even back them with?

Normally the city issuing them promises to redeem them in dollars. The idea is it keeps spending in the city. the first few months it produces results, I suspect from the novelty aspect of the currency.

On the bright side I don't think the SS investigates local currency counterfeits.

Useful in specific situations. Like when a local economy has good or services to offer, but no liquid capital in circulation. Since all that is needed is a local stimulus it is better to act on a local level rather than the national level.

Foolish. Idiotic. Any number of synonyms that mean the same or have similar meanings. What would they even back them with?
Trust and a small amount of money.

These things work well on the small scale, while they're still cute enough for everyone to love them and no one to actually start aggressive financial speculation involving them - floating-rate exchange, high-risk loans, high-leverage trading, et cetera.

They would also work very awkwardly if you say started selling and buying houses using this currency.

Now that I'm thinking about it, wouldn't it be just the bank that wins since they're the ones exchanging the national currency for this local currency? And aren't they just trading fake money for more fake money?

This issue is confusing. Like I said, at least the liberty dollars are gold and silver and actually worth something.

My little town was mentioned in the CNN clip. We have had Ithaca hours for almost 20 years now and it works just fine. Its not a huge part of the economy but various local stores accept them as currency. Some stores limit the number of Ithaca Bucks you can spend on a purchase so in some ways it just ends up being a discount price. The system in Ithaca is one of the longest running in the Nation and it works fine. Its not a huge part of the economy or anything but its like getting a small discount on local stuff in town. Ive lived here 40 years and ive spent maybe 2 or 3 Ithaca Hours bills in that time. Just think of them as 10% off coupons for many stores instead of just the one normally printed on the coupon.

I will stick with the liberty dollars personally. It is more a matter of getting someone to accept it as a currency.