[TheDude]

Local Exchange Trading Systems - Wikipedia, the free encyclopedia

Local Exchange Trading Systems (LETS) also known as LETSystems are local, non-profit exchange networks in which goods and services can be traded without the need for printed currency. In some places, e.g. Toronto, the scheme has been called the Local Employment and Trading System.

LETS networks use interest-free local credit so direct swaps do not need to be made. For instance, a member may earn credit by doing childcare for one person and spend it later on carpentry with another person in the same network. In LETS, unlike other local currencies, no scrip is issued, but rather transactions are recorded in a central location open to all members. As credit is issued by the network members, for the benefit of the members themselves, LETS are considered mutual credit systems.

Anybody have personal experience with local currencies? Ups and downs, pitfalls, hard earned advice?

An old thread here mentioned it but I figured it could use its own home, since our currency is likely to become the proverbial toilet paper in short order.

This could as well be at home in PFTF but I wanted to get the angle from all you economics savvy types.

[ReverseEngineer]

As I wrote in a prior thread, I think rather than an "Amero" being introduced, rather what you will see are new currencies issued by given locales to maintain local trade.

To do this QUICK, the best way would be to fix current prices on all goods, and then do a qucky redistribution of the total weath in the population dividing up the amount of wealth in goods by the total population. Those would be the necessary goods for immediate survival, aka FOOD.

No international trade for a while, it would be up to each local economy to become self sufficient. However, theft of goods from another economy could subsidize emerging local economies. So I would expect pirating and surrounding of warehouses to be part of this game in localized areas. Local military commanders probably have the upper hand in this at the moment.

Eventually, those local economies that do survive will be able to trade directly with other local economies. Not over water though, to much pirating possible and too easy to sink ships.

I think the US as a Nation fals apart under the bankruptcy. Could China hold say Illionois responsible for a debt incurrd by all of America before dissolution fo the Union?

I see a fractionalization of the wealth, and those areas able to self support should make it through, perhaps. However, extreme shortages in the process.

Reverse Engineer

[IslandCrow]

I joined one group, but was passive...basically I did not have the services or goods to 'sell' that were needed in the group, in part I was not really involved with the people before joining the group.

This experience taught me that I should learn more practical skills, rather than the skills I need for an office job. Some of these I am working on as I prepare for a world with less oil

But in general I think LETS is a good idea (along with other local currencies ideas). However, where I am now, I guess what will take its place is more of an informal swapping of work, rather than a more ridged

[BigTex]

This is a little off topic, but it has occurred to me occasionally that shares of the PM ETFs--GLD, IAU, SLV, etc.--could be used as a type of money backed up by PMs.

You could go to the store and everything would be priced in shares of GLD.

Sort of an ad hoc private gold standard.

[Dreamtwister]

Local Exchange Trading Systems - Wikipedia, the free encyclopedia

There's another word for that. It's called "barter".

[jbrovont]

This sounds like a really good idea.

Local Exchange Trading Systems - Wikipedia, the free encyclopedia

Local Exchange Trading Systems (LETS) also known as LETSystems are local, non-profit exchange networks in which goods and services can be traded without the need for printed currency. In some places, e.g. Toronto, the scheme has been called the Local Employment and Trading System.
LETS networks use interest-free local credit so direct swaps do not need to be made. For instance, a member may earn credit by doing childcare for one person and spend it later on carpentry with another person in the same network. In LETS, unlike other local currencies, no scrip is issued, but rather transactions are recorded in a central location open to all members. As credit is issued by the network members, for the benefit of the members themselves, LETS are considered mutual credit systems.

Anybody have personal experience with local currencies? Ups and downs, pitfalls, hard earned advice?
An old thread here mentioned it but I figured it could use its own home, since our currency is likely to become the proverbial toilet paper in short order.
This could as well be at home in PFTF but I wanted to get the angle from all you economics savvy types.

[DomusAlbion]

We've been trying out barter with our neighbors for the last two years. My labor for beef, our pork for large basalt rocks, our eggs for small jobs around the farm.

I imagine that we'll be doing more of this as time goes by and more neighbors tune in to reality.

[MacG]

We have a couple of heavyweights on the scene. First Tim Jenkin and his CES. Tim took on Apartheid in the 70's - and won!. Tim has a head of his own, and the book is absolutely worth a read. Now he is taking on the global apartheid system in the form of "money".

Almost as persistent as Tim are the Dutch guys and gals at Strohalm. They have spent serious efforts developing "Cyclos" software free for download.

Then we have the ultimate protective colored Bartercard. These guys are dead serious!

There is quite a scene in "alternative monetary systems" out there, and I encourage everyone interested to investigate it. For a springboard, check out the postings of "JCarvingblock" over at Gold is Money. The forum is a bit crazy, but that particular guy is among the sharper knives in the barbershop.

Oh, don't forget to read The Future of Money by Bernard Lietaer.

[TheDude]

Thanks for all the links, MacG. Wish I could pick up a copy of the Future of Money but it's

Code: Select all

5 used & new available from $99.00

So I guess we're headed for inflation?

[Ludi]

I prefer the sharing or gifting economy, personally.

[smiley]

I prefer the sharing or gifting economy, personally.

It is definitely preferable to the stealing and looting economy

[Ludi]

It is definitely preferable to the stealing and looting economy

The more sharing we do the less looting will be necessary...

One likes to hope....

At least this particular pollyanna likes to, anyway.

[TheDude]

As if on cue, new at TOD from Big Gav: Locabucks: Are local currencies a way to escape the liquidity trap ?

[wisconsin_cur]

Milwaukee Neighborhoods consider printing their own currency

They may be talking funny money, but it's not funny business.

Residents from the Milwaukee neighborhoods of Riverwest and East Side are scheduled to meet Wednesday to discuss printing their own money. The idea is that the local cash could be used at neighborhood stores and businesses, thus encouraging local spending. The result, supporters hope, would be a bustling local economy, even as the rest of the nation deals with a recession.

"You have all these people who have local currency, and they're going to spend it at local stores," said Sura Faraj, a community organizer who is helping spearhead the plan. "They can't spend it at the Wal-Mart or the Home Depot, but they can spend it at their local hardware store or their local grocery store."

Incentives could be used to entice consumers into using the new money. For example, perhaps they could trade $100 U.S. for $110 local, essentially netting them a 10 percent discount at participating stores.

[JPL]

I was a founding member of a LETS scheme back in Newquay, Cornwall back in the early 90's. We organised it through our local Green Party group. We had a banker, a secretary & printed chequebooks that other members could exchange for goods & services. We also took advice from the Totnes LETS sceme which had been running for some time.

It did work quite well but the main problem was achieving 'critical mass'. By the very nature of the sort of people that get involved in such things, most of us were too busy earning 'real' money to spend much time on the scheme. So apart from babysitting & haircuts the turnover was really quite small. Our local Health Food shop was quite pro-active but they quickly got into the position whereby they had plenty of credit in the 'system' but didn't need any more haircuts or babysitting services, thank-you very much.

So it sort-of faded after that, really. Having said which, the principle worked quite well. I think in the future, if you have more people with time on their hands (roll-on GD II) then these things could work better going into the future. Certainly the principle has been proven, they do work. It's just a lot of effort to get it all rolling in the beginning.

JP

[dohboi]

I have no first hand experience, but from what I have heard, it's good to get as many local businesses on board as possible.

Lots of businesses have some sorts of coupons or deals where when you buy X number of their product you get the next free.

It doesn't seem like that big of a jump from there to a common currency.

For example, because of a change in local happy hour laws, our local bar gives out "wooden nickels" when you buy a drink at certain times of day that you can "redeem" as a drink any other time.

Imagine that wooden nickel being accepted at the coffee shop down the street for a latte, at the liquor store for a couple bottles, at the video store for a rental....

All of these businesses have their own "wooden nickel" type deal, their own currency, so to speak--it's just a matter of getting all these local businesses to agree to accepting what is in essence each businesses exclusive currency as a more common currency.

Obviously the big chains will never accept these tokens as currency, but that's half the beauty of them--they stay local and encourage local shopping.

I have heard of some systems where they got a local bank involved. The bank would sell ten units of the local currency for nine units of the standard currency. The discount encouraged the use of the local currency, but was not really more generous than the coupons...the local businesses were already offering. It was just essentially a commonly agreed upon coupon.

My understanding is also that such systems are tolerated as long as they aren't TOO successful. once they start to seriously compete with standard currency in the area, they are simply outlawed.

So success is failure. Oh, well.

[bratticus]

The Indian Said

One Day You Will Realize You Can't Even Eat Local Currencies.