1. Complementary Currency and Exchange
The Movement to Reinvent Money

2. Why Does Money Need to Be Reinvented?
Throughout the world, money has been politicized and privatized.
Money has become the keystone in the arch of political power.
Money and banking are manipulated by and for limited private interests.
Political money is exploitative, dysfunctional, and undemocratic.
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3. Two Parasitic Elements of the Conventional Money System
Interest
Collected by the banking cartel
Inflation
Caused by government deficit spending
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4. How is Political Money Dysfunctional and Exploitative?
Political money is inefficient and inequitable – many needs go unmet because the supply of money is deficient.
Periodic cycles of depression and inflation derive from the actions of central banks.
Money concentrates power and wealth – the rich get richer; everyone else gets poorer.
Who decides whose interests will be favored?
Conventional political money causes social and international conflict and ecological destruction.
The Great Depression of the 1930’s provides a prime example of the systemic flaws, as do the innumerable examples of hyperinflation that has occurred in various countries.
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5. Stay the course, Bernanke.
June 8, 2006

6. Privatization Taken to Extremes Means
Not better management, but
Privilege,
Exploitation,
Conflict and
Class warfare
Elites have typically sought to dominate and exploit others through the strategies of
Enclosures
Clearances
Legal privilege
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7. The Basic Approach
Take control of essential or desired resources, and compel everyone to pay in order to gain access.
Monopoly
Oligopoly
Cartels
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8. Examples
The enclosure acts in England privatized common land by legal coercion.
“Clearance” of lands (Scottish highlands) by military force or intentional destruction of its ability to support life (slaughter of the bison herds in North America).
Government-granted monopolies that limit or eliminate competition (British East India Company).
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9. June 8, 2006

10. Money is Credit
Credit is Money
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11. Credo = Belief > Credit
All credit derives from belief in a promise.
Credit is based on trust.
Who deserves credit?
Who or what do you trust?
Whose promise will you accept as payment?
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12. What is the Credit Commons?
The credit commons is
the virtual pool of credit and trust.
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13. Credit is based on trust
The Credit Commons
Privatization of the commons. Banks throttle the credit allocation process and exploit users of credit by charging interest for its use.
Central governments spend as much as they wish without regard to the amount of their tax or other revues. This is called “deficit spending” and its result is debasement of its currency unit, a phenomenon commonly referred to as inflation.
The In’s and Out’s of the Credit Commons
Credit is based on trust
We all put in, but who can take out?
June 8, 2006

14. The Credit Commons can be accessed only through banks!
“Loans”
“Loans”
Privatization of the commons. Banks throttle the credit allocation process and exploit users of credit by charging interest for its use.
Central governments spend as much as they wish without regard to the amount of their tax or other revues. This is called “deficit spending” and its result is debasement of its currency unit, a phenomenon commonly referred to as inflation.
“Loans”
Central Government
The Credit Commons can be accessed only through banks!

15. Fundamental Principle of Modern Money
Modern money is nothing more than credit based on a promise.
Money typically takes the form of
Bank deposits that are created when banks make “loans,” or
Currency notes emitted by the central bank.
Why do we trust these forms of money?
We trust conventional money because we know of no other kind, because others accept it, and because we are habituated to its use.
June 8, 2006

16. Privatization of the Credit Commons
Access to credit is controlled by the banking system.
Banks decide who gets access and on what terms. They charge interest on all “loans.”
National governments have extraordinary access.
By their arrangement with the banking system, they can borrow as much as they wish.
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17. The Central Government-Central Bank Nexus
The debt economy rests upon a conspiracy between the political state and the banking interests against commercial exchange…
E. C. Riegel
The greatest factor in keeping the monetary and financial systems viable over
the past 50 years has been the role of the Federal Government as “borrower of last resort.” When others refused to borrow or were refused credit by the banks, the Federal Government borrowed money into circulation. This began with the institution of the New Deal programs by which the Government began to borrow money and then spent it into
circulation. These amounts, however, were relatively modest. It took World War
II to provide an excuse for the really huge deficits required to pump up the money
supply to adequate levels.
June 8, 2006

18. Money Power Equals War Power
…as long as our governments are vast counterfeiting machines, Mars can laugh at peace projects.
-- E. C. Riegel
If the government were obliged to come to the people for money instead of vice-versa, the people would keep government under control and operate their economy satisfactorily with prosperity and peace resulting.
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19. Reclaiming The Credit Commons

20. The Exchange Process is Being Reinvented
Complementary Currencies and Credit Clearing Arrangements are Emerging on Various Levels and Fronts.
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21. Promising Directions
Freedom approaches based on voluntary participation, that involve
Grassroots organizations,
NGO’s
Associations of businesses,
Municipal and provincial governments,
For-profit enterprises
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22. Main Currents of the Movement
Voluntary
Grassroots
Social Action
For-profit
Business
Exchange Options
Barter Exchanges
Trade Exchanges
Mutual Credit/LETS
Community Currencies
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23. All over the world, mutual credit systems and community currencies are emerging.

24. Established in 1934, the WIR Bank has continued to thrive.
The Swiss WIR Bank is a prime example of a credit clearing association.
Established in 1934, the WIR Bank has continued to thrive.
The WIR Bank clearing system now serves more than 60,000 small and medium sized business members.
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25. In Argentina, trading clubs and private currencies proliferate in the face of economic and financial stringency.
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26. Commercial interests are discovering the advantages of direct credit clearing.
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27. Provincial Government Currencies
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28. What Are the Disruptive Technologies in Money and Banking?
Mutual credit.
Credit Clearing.
Co-responsibility.
Internet based markets, social networks, accounting and information management.
Reliance upon “strong identity.”
Reliance upon peer-to-peer reputation ratings.
June 8, 2006

29. It Is the Unique Combination of Elements That is Revolutionary
These technologies are being combined into new products that make the exchange process:
Simpler
Less costly
More efficient
More equitable
More democratic
Easier to understand
Sustainable
June 8, 2006

30. The Next “Free Abundance” is Credit
The present system of money and banking is a choke on credit, which is potentially infinite and free.
The practical limits of credit are:
The productive capacity of the buyer, and
The trust of the seller
The appropriation of credit by the government and banking sectors diverts a huge proportion of economic output from need satisfaction to accumulation and waste.
“Nations, companies and individuals that exploit the ‘free’ abundance (that is, the resource with the plummeting price) gain market share against all rivals…. The political leaders who accommodate them become the prime movers in global affairs. Their countries pioneer and prosper.” George Gilder, Telecosm, p.7).
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31. The Future of Money is No Money
The highest evolutionary step of reciprocal exchange is the process of mutual credit clearing.
The future of exchange lies in decentralized autonomous mutual credit clearing networks.
These networks will be linked together without the center destroying their autonomy.
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32. A New Economic Order?
“…extension of exchange transactions without state money is in reality the beginning of a new system of settling accounts, indeed the beginning of a new economic order."
--Ulrich von Beckerath
June 8, 2006

33. Sources
Books:
Money: Understanding and Creating Alternatives to Legal Tender - Greco
Money and Debt: A Solution to the Global Crisis - Greco
Flight from Inflation - Riegel
The New Approach to Freedom - Riegel
Website:
Blog:
June 8, 2006