U.S. states start printing their own currencies

Pravda reports about US states starting to print their own currencies.

(emphasis mine) [my comment]

U.S. states start to print their own currencies
09.04.2009


Many U.S. communities are creating their own currencies now. They try to help consumers and companies to fight the global financial crisis and the recession.


U.S. states start to print their own currencies

The idea, borrowed from the Depression era when the currencies were known as "scrip", is designed to boost local spending and keep money circulating within the community.

Typically, a group of businesses print a new currency which shoppers can then buy at a discount — typically one dollar will cost 90 to 95 cents — and spend at full value with participating companies.

Some of the currencies have been around for years but the recent economic downturn has encouraged others to follow suit. According to some estimates, there are now more than 75 local currency systems across the country.

Others include the Ithaca Hours in upstate New York and the Plenty in North Carolina.

Under US law, small communities can produce their own currency so long as it does not include coins and does not resemble federally-issued money.

The currencies are not a tax dodge as the income to participating businesses is liable to tax.

In Traverse City, Michigan, more than 100 businesses accept Bay Backs, among them restaurants, B&Bs;, a doctor, accountant and even a tarot card reader.

Around $2 million worth of BerkShares — the most established local currency — is circulating in the Berkshires, a rural area in southern Massachusetts, telegraph.co.uk reports.

The beautifully-illustrated notes portray local "heroes", including the author Herman Melville, the artist Norman Rockwell and a tribe of Mohicans.

CBS reports that some cities are printing their own cash.

In Recession, Some Cities Printing Own Cash
Derrick Blakley

CHICAGO (CBS) ?


You've probably heard critics
[like me!] claiming Uncle Sam is printing money like it's going out of style. Now, as CBS 2's Derrick Blakley reports, some towns are getting into the act since their communities were granted a license to print money.

At a time when money's tighter than ever in Ithaca, New York, they're now printing they're own.

They call their funny money "Ithaca Hours."

In Pittsboro, North Carolina, it's much the same. Local businesses are distributing their own bizzaro dinero called, "The Plenty."

"Bring nine dollars to the bank and you get 10 Plenty's. You're increasing your local purchasing power right there," said Pittsboro merchant Mary Demare.

Jerry Roper from Chicagoland Chamber of Commerce, thinks the idea is something Chicago should consider.

"The appeal is you do get a 10 percent discount, or a 15 percent discount and for the shop owner, the restaurant, retail people, it's keeping traffic moving, keeping staffs working," said Roper.

The concept isn't a new one. During the Depression,
Chicago businesses often paid their workers in privately printed money called Scrip.

Scrip was also used to pay workers who dug the Chicago, Illinois and Michigan Canal, but its use declined because workers rebelled.

"Eventually people became very angry at this and felt like it was another way to control their lives," said Peter Alter, the Chicago History Museum's curator.

Now, it's an attempt to take control as the economy slips and slides.

"Do you complain about it, wait for politicians to solve the problem or do you say
if you don't have enough money, why don't we make our own [this line of thinking is warped, yet it is a good representation of the financial wisdom underlying the US economy]," asked one shop owner.

Closer to home, business groups in Milwaukee and South Bend are considering printing their own local currency, but Uncle Sam stipulates that any form of local cash can't resemble federal money or be promoted as legal tender.

USA TODAY and CBS NEWS reports about a "silver lining" to the financial crisis.




My reaction: Towns and cities are now printing their own money. And why not? The fed is printing trillions, and the dollar has collapsed (yet). Doesn't that meant printing money is the costless solution to all the world's problems?

1) Many US communities are creating their own currencies now.

2) These currencies are designed to boost local spending and keep money circulating within the community.

3) Under US law, small communities can produce their own currency so long as it does not include coins and does not resemble federally-issued money.

4) There are reportedly now more than 75 local currency systems across the country.

5) the most established local currency, the BerkShares, has around $2 million worth of notes in circulation.

6) There are an amazing number of people who believe you can achieve prosperity through the printing press.

"If you don't have enough money, why don't we make our own" (normally this is line of thinking leads to a crime called "counterfeiting", which is punishable by death in many countries)


My reaction: During periods of hyperinflation, states and towns often end up printing their own money to support their local economy. This occurrence is another manifestation of the flawed economics which lead to the hyperinflation in the first place. After all, when the financial elite believe in "prosperity through the printing press", it is only natural for towns and cities throughout the country to also adopt this philosophy and start printing their own money.

This entry was posted in Currency_Collapse, News_Developments. Bookmark the permalink.

7 Responses to U.S. states start printing their own currencies

  1. Anonymous says:

    Achieving prosperity through the printing press. Sighh, are people still falling for this???

  2. Robert says:

    These local currencies have been going on for ages. Ithaca Hours have been around since 1991.

    I don't think there's anything particularly wrong with them (the ithaca hours central bank probably has more integrity than the FED - although since they maintain a dollar peg it will suffer from US inflation in the same way that China's yuan does) - the idea is that providers of goods and services accept a currency that is only useful locally - that way making a commitment to spend it locally themselves keeping more of the wealth in their community.

    It's just a small version of any other national currency. It may seem somewhat silly, but no more so than calls for people to "buy american" or "buy local" etc.

    In any case I don't think these currencies have anything much to do with the current financial crisis they were around before and will be around after.

  3. Pohon Bodhi says:

    Why the merchants don't just discounting selling prices 10-15%?

    Why bother exchanging US dolar with those new money?

    "Print" money used to mean just print & spend, doesn't it? This exchanging dolar-new money doesn't change anything.

  4. Anonymous says:

    My question is: Who gets to print this local currency? Can any merchant print it and offer it to their customers?

    I agree with the previous post - have the local retailers offer a 10-15% discount with Fed notes.

  5. Mackey says:

    The problem with all of these are that they are tied to the official currency and redeemable, so the only real advantage to the consumer is the discount.
    Instead why not bypass the real shortcoming of Fed notes - that they are not redeemable and start COINING real money locally? If Merchants priced their goods alternatively in grams of gold and silver they could accept small coins. A small digital scale is cheap now - no reason to worry about shaving as the weight can be checked in seconds.

  6. xoddam says:

    Scrip makes perfect sense as long as it encourages turnover eg. with demurrage (built-in depreciation).

    http://www.monbiot.com/archives/2009/01/20/a-better-way-to-make-money/

  7. Noozboy.com says:

    Mackey,

    Coining your own money is the fastest way to get the Feds to throw you in prison.

    Read the wikipedia entry for local currencies. The story of Wurgl Austria during the last Great Depression is very instructive.

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>