Local Currency Project

Hi Sasha, you want to forward this email to the group so we can start evaluating how viable a local currency might be. Thanks!


So to follow up on the meeting minutes email, I thought I'd send out some info on the local currency idea. The most important factor in creating a currency is you have to have people willing to trade in that currency, so this email is primarily to find out who would be interested in offering goods/services in exchange for a local currency.


But I should give a little background on the project. First, I imagine most people probably wonder what exactly is a local currency and what's the point of creating one?


The main purpose of most local currencies is to encourage people to get the goods and services they need from their neighbors and people in their own community. Local currencies can take the form of paper bills, or on-line accounts, or just about any other method that allows people to keep track of what has been spent and received. Because local currencies can only be traded with people willing to accept the currency, this keeps the money in the local community with all the benefits that entails (stronger community ties, your money stays in your community where your friends and neighbors continue to benefit, less environmental impact when goods aren't transported long distances, etc.). Another important benefit is local currency can serve as a back-up means of exchange in the event of a major disaster or economic depression that cuts off access to the supply of traditional dollars. During the Depression, and in other nations and times of significant distress and upheaval, there are many examples of communities using local currencies to keep the economy functioning and keep goods and services flowing from people who have them to people who need them. There are other minor benefits as well (thieves would generally have no interest in such a currency, for example).


That's the generalities of a local currency. Here's what I'm thinking about for a local currency here...absolutely subject to change, revision, input, etc. at this point.


I'm thinking about the name LakeShare for our unit of currency. In essence, a unit of currency simply represents a share of the economy that trades in that currency. Owning a LakeShare entitles a person to a share of the goods and service offered by those in the Lake Merritt vicinity who are willing to accept LakeShares. I think the way we can issue new LakeShares is by offering a certain amount to people willing to perform some sort of public service. So, for example, we could get our LS economy started by providing 100 LS to everybody who comes out to spend a day cleaning up a public area. These would then be traded among everybody offering goods/services. Periodically, we could offer new LS for different community projects. Like dollars, LakeShares would continue to be spent over and over again, so in time the supply of LakeShares would grow. Hopefully the goods and services that are available to buy with LS would grow, too, so the LS would keep a fairly consistent value. Initially we'll try to keep the value of a LS fairly close to the value of a dollar so that people will be able to place a reasonable value on items they want to offer or buy. In time, it could probably change...since one of the reasons to have a local currency is a back-up to the accepted currency, LakeShares will not be "pegged" to the dollar; so the dollar could experience runaway inflation without necessarily impacting the LakeShare.


OK, so that's the background, now for the important part:


Who would be interested in offering a good or service as part of our local community economy? You might be a professional already offering products services to the general public, and that's great. But even if you're not, that's OK too. Maybe you can offer something similar to what you do for work to your friends and neighbors. Or maybe you'd simply be willing to baby-sit, walk dogs, or provide something else that you may not do professionally but are perfectly capable of doing. Maybe you're willing to sell art or items from your garden. I'm sure everybody has something they can offer if you're willing and have some imagination.


I've talked with the founder of a pretty successful local currency (evolving into a regional currency) in northwest Washington state, and he's observed the "magic number" for people participating in the local economy needs to be about 35 for a local currency to have sticking power. So it may take awhile for us to amass enough people (which is fine since I'm certainly not going to have time to get this off the ground until after tax season ;-), but that gives us a bench mark to shoot for. But if you have something you'd want to offer your friends and neighbors in exchange for what they have to offer, send me an email so I can start compiling a list. As we start approaching 30, we can meet to hash out some of the specifics, but for now I'd just like to start putting the building blocks in place. Without people willing to offer goods and services, no currency can be successful.


Thanks for reading this fairly lengthy email,
Devin


PS For more information on how a local currency might work, you can visit www.fourthcornerexchange.com for information about Life Dollars in the Pac NorthWest. There's links on that site to the following video: "Money as Debt"--http://video.google.com/videoplay?docid=-2550156453790090544#. It's about 45 minutes long, but it's a useful background on how currencies work in general, how our current national currency works, and what a viable alternative might look like. I find it a little over the top in attributing dark and sinister motives to the architects of our current financial system, but the description of our currency reserve system is pretty accurate. I really like the alternative system described at the end and conceptually it is almost identical to what I've had in mind for our LakeShare currency. Just a little extra info for anybody who might be interested.

--
"The greatest obstacle to discovering the shape of the earth, the continents, and the oceans was not ignorance but the illusion of knowledge."
-Daniel J. Boorstin (Pulitzer Prize winner)

"I've learned how to live without knowing. I don't have to be sure I'm succeeding, and (...) I think my life is fuller because I realize that I don't know what I'm doing." - Richard Feynman (Nobel award winner)