And all these multifacted changes were imposed on everyone's individual lives by a handful of people in an ornate boardroom in Washington, DC, whose names few investment professionals even knew, much less the general public.
The remarkable thing was that everyone accepted the entire process, seemingly as normal as physical laws of nature, despite the fact that it was really as ethereal as a rainbow. The money did not physically exist. Even 'real' money was not specially made paper printed with black ink on the front and green on the back. What backed the money was not gold or something of intrinsic value, but rather the collective belief that money had value because it had to have such value.
Thus it was that the monetary system of the United States and every other country in the world was entirely an exercise in psychology, a thing of the mind, and as a result, so was every other aspect of the American economy. If money was simply a matter of communal faith, then so was everything else....
Holders of that faith included the governors of the Fed, because they truly understood it all -- or thought that they did. Individually they might joke that nobody really understood how it all worked, any more than any of them could explain the nature of God, but like theologians constantly trying to determine and communicate the nature of a deity, it was their job to keep things moving, to make the belief-structure real and tangible, never quite acknowledging that it all rested on nothing even as real as the paper currency they carried with them for the times when the use of a plastic credit card was inconvenient.
They were trusted, in the distant way that people trusted their clergy, to maintain the structure on which worldly faith always depended, proclaiming the reality of something that could not be seen, an edifice whose physical manifestations were found only in buildings of stone and the sober looks of those who worked there. And, they told themselves, it all worked. Didn't it?
-- Debt of Honour, by Tom Clancy
Mitigation and Preparation for Peak Oil
As far as I am aware, virtually every Peak Oil Dr. Doom has warned that Peak Oil would result in a crash of the world economy. Cheap Fossil Fuels and Debt Based Fiat Currency Economies are Intimately Linked.
Their Economic Relocalisation Strategic Advice, among others:
- Relocate: Factors to consider: Arable land, Moderate climate, where you can grow your own food, Friendly community.
- Financially: Get out of Debt; Get Rid of Credit Cards, or use them as Monthly Debit Cards, paid off in full.
- Relocalise your Lifestyle Aim: Least Dependent on far-flung fossil fuel transportation and distribution networks.
- Strengthen your body Physically and with Organic Food: Secede from Fossil Fuel Ponzi Health Care System
- Solidify Skills and/or Social Networks
- Relocalize Money/Change the Way Money Works: Participate in Local Currencies
- Shop Locally wherever Possible: Secede from Addiction to the MultiNational Debt Slavery Tape Worm Economy
- Support Local Farming: Buy Local, Get involved in a Local Farmers Market; or Start Your own Home or Community Vegetable Garden.
All of the above actions, are actions whereby you are directly or indirectly Financially Seceding from the Financial Tape Worm Debt Slavery Economy. Baby Steps to Financial Secession.
Secede and Relocalise your Finances: Local Currency Ideas
In A New Kind of Money, Peak Oil Dr. Doomer Julian Darley warned in 2006 (excerpts):
The decline in the availability of cheap energy is likely to be accompanied by an equally ominous possibility of world financial meltdown. That we are facing both of these threats now is not an accident: energy and financial stability are intimately linked. I believe the solutions for dealing with these twinned threats are equally linked. To build an environmentally sustainable, monetarily stable world, we need to create an economy in which locally produced energy provides the backing for local currencies.
And here's the link to money: we have made the same limitless assumption about money, that the world monetary supply could grow without end as well. In both cases, we assumed that the growth in energy-use and in money supply was an unmitigated good.
There have been a growing number of voices warning us that both of these assumptions were wrong, that the notion of unchecked growth was leading us toward environmental and financial meltdowns. And while we have been making some progress in understanding the energy problem, there is virtually no mention of the role of money.
I admit that thinking clearly about money can be difficult. Money has been around far longer than the oil age, the industrial era, and may even pre-date civilization itself. But though we may take money for granted, it is neither simple nor solid nor reliable -- far from it. Money is a complex and fragile construction, and as history has shown over and over again, money can become worthless almost overnight. In the long run, money has proven very difficult to manage -- it's a tricky and strange invention.
The original driving force behind money was our need for specialization as we grew from hunter-gatherer societies to settlements of a few thousand, and now cities of millions. Money helped us to increase our carrying capacity -- the number of humans a given area will support at a certain level of technology -- but it has also helped us to become largely disconnected from the real material world.
Today's global monetary system is based on currencies controlled by national banks, and the global trading system is mainly based on one of those currencies: the US dollar. This system leaves communities and individuals vulnerable to the fluctuations of the global market.
Money can be "backed" by all kinds of physical substances, like precious metals. Or money can be "fiat" ("let it be made") like most national currencies today, backed by nothing except faith and confidence -- or sometimes just confidence tricks.
Unlike a backed currency, a fiat currency can at least in theory quite literally expand for ever. There is no direct link to material reality to impose limits, only economic theory, which is devoted to eternal growth and doesn't like to deal with limits -- or reality -- at all. An unlimited currency along with unlimited growth and (so far) unlimited energy has allowed us to do almost unlimited damage to the planet. However, as the availability of cheap, abundant energy declines, energy will soon become the dominant partner in the relationship with money, and money's true dependence on energy will finally become apparent for all to see.
As energy becomes increasingly expensive and scarce, the colossal size and scale of our infrastructure, which has characterized the rise of industrialism, will selectively crumble and become unserviceable. It is only the energy subsidy from hitherto ever-increasing use of cheap fossil fuels that has allowed our current grandiosity. If this argument is correct, national currency reform will become an oxymoron. It will become apparent that local currencies must be created, currencies based on the resources of the locale -- be they abundant or austere.
Communities can further insulate themselves by de-monetizing as many goods and services as possible and try to produce as much of their vital needs as locally as possible, especially food (from local farms and processors) and renewable energy.
Demonetizing means taking a product or service out of the market so that it does not need a monetary value. Hence the need either to stop using a product or to produce it yourself.
When you take a potato from your garden, if you are fortunate enough to have one, you don't pay yourself a dollar for the privilege -- you just clean it, cook it, and eat it. Demonetizing can also be done via barter, and this is in fact quite common in business, including in the industrialized world. But demonetizing flies in the face of globalization and the Industrial Revolution.
Communities that create such local or regional currencies will have a much better chance both of riding out the coming energy decline and of being buffered from any monetary or economic collapse that may happen for whatever reason. The sooner such systems are created, the more ready that region will be to withstand shocks and to avoid the terrible unemployment which severe monetary instability invariably brings.
There are predominantly two different kinds of Local Currencies.
Scrip is the Local Paper Currencies that thousands of Communities created as their Local Currencies, to cope during the Great Depression.
This is a BBC clip, covering recently created Berkshares Scrip, in Great Barrington, MA.
Other well known Scrips are Ithaca Hours, from Ithaca New York. Who knows what Orania's local currency is called?
Scrip Local Currencies are usually used by anyone in the community who will accept them as payment for labour or services rendered; or businesses that accept them for payment for particular locally produced goods. The administration of the Local Currency is determined by the people in that community, who use it and participate in electing whomever they want to be in charge of it.
Their benefits: They enable the trading of local services and goods that a scarce financial instrument may restrict.
TWO: ELECTRONIC BARTER:
These are generally internet or electronically based Communities, such as LETS (Local Electronic Trading System), or CES (Community Exchange System). You join a particular Local CES, and then you can trade with others who belong to the same system. Your ‘trades’ of labour or service provided are ‘banked’ into the CES bank, and you can then purchase other services you need, from others who offer such services within the system. The CES System call their Trades’ ‘Talents’. So you charge, for example, T80 for an oil change.
This is how a CES Trade works (after you have registered and become a member of the CES Community:
Requirement: Your car needs an oil change.
Step 1: You either look through the Offerings List or do a search to see if anyone is offering oil changes or car maintenance. Someone is offering oil changes for T80 but you must bring your own oil and oil filter.
Step 2: In the Offerings List you click on the person's name to obtain contact details. You phone the person (the 'seller') and agree on a time and place for the oil change.
Step 3: The oil change takes place and then you (the 'buyer') fill in a Trading Slip (obtainable from the site), giving the date, your name, your account number, the amount (T80) and your signature. You fill in the same details on the counterfoil and get the seller to sign it. The counterfoil is then separated from the slip and you hand the main part to the seller, keeping the counterfoil for yourself. For the seller your Trading Slip represents your payment and your acknowledgement of the service or goods delivered; for you the counterfoil is your record of payment.
Step 4: You leave, satisfied that your car has fresh oil. The seller then goes to a computer and enters the details of the trade into the transaction form of his or her CES 'bank account'. This becomes a credit for the seller and a debit for you. You are now obliged to provide goods and services to the community worth T80.
Community Exchange Services currently exist for the Local Communities, of among others: Bredasdorp, Capetown, East London, Garden Route, Grahamstown, Greyton, Helderberg, Johannesburg, Klein Karoo, Namaqualand, Pietermaritzburg, Port Elizabeth, Pretoria, Richards Bay, Stellenbosh, etc.
To join any of these, or to submit a registration to start a CES in your Community, contact CES.
The Problems with Conventional Money
It is partisan
Money as we know it is not a neutral service provided by the government. Our money supply is created by private financial institutions on a for-profit basis. This money system is designed to benefit those who provide it, not those who use it.
It is based on debt
Money is created when banks grant loans. Thus for every unit created there is one unit of debt.
We are encouraged to think of it as a 'thing'
Money is essentially information and has no physical existence yet banks encourage us to think of it as a 'thing' so that they can 'lend' it to us and thereby make a profit by charging interest. 'Thing' money also has to be created, distributed and controlled so that there is not too much of it. It can also be stolen, lost, bought, sold and counterfeited, with serious consequences for everyone.
It is permanently scarce
The money to pay the interest on debt-money is never created. There is therefore a permanent shortfall of money to pay back both the principal and the interest.
It causes cancerous growth
Banks continuously need to create more money than is required to pay back their loans so that borrowers can pay back the interest on those loans. This is the source of the growth imperative of our economics. There must be a continual expansion of bank credit or else the economy goes into recession. Systemic growth leads to the environmental problems we now all face.
Its value is based on its shortage
The shortfall of money keeps it valuable. There only needs to be enough of it to buy back the goods and services available. This has nothing to do with the monetary requirements of people. Those who have none are not seen by the market and so are marginalised.
It is expensive
Every unit of conventional money is based on a unit of debt. This debt has to be paid back with interest, and the interest on the interest is compounding. Interest is built into the prices of everything we buy, resulting in higher consumer prices.
It redistributes wealth from the poor to the wealthy
Usury is the tool used by the wealthy to suck wealth from the poor and middle classes to the moneyed class. Parasitism and class antagonisms are the result of this.
It promotes dishonesty and corruption
You can get it without delivering anything of value (e.g. speculation, interest, gambling etc.) so people concentrate on 'making money' rather than producing/delivering anything of real value. It is usually far easier to get money through dishonest means than by honest work. When you have no money you have no choice but to try and get it dishonestly
It leaks away from where it is created
Conventional money knows no bounds and loyalty. It always leaks away to the 'money centres' (financial centres, big businesses, etc.)
It destroys local economies
Goods produced cheaper elsewhere replace locally produced goods. This creates a local shortage of money and reduces the market for local sellers. This also results in the irrational transportation of goods all over the world, consuming precious fossil fuels and creating pollution.
It destroys community
Dependence on money means we no longer need our neighbours. We can get everything from anonymous strangers in return for money. We have no obligation to anyone when the bills are paid. Every trade is a complete and closed action: you provide me with something and I give you money. End of story. No one does us any favours and we need do no favours to anyone.
It fosters competitiveness
The shortage of money means we all have to fight for a share of an amount that is too small to go around. The need to repay interest means that we have to eat others to prevent ourselves from going under.
It creates poverty
While it makes some super rich, it makes most people poor. Poverty is caused by a lack of money (not by a lack of jobs). Usury and the need to keep money scarce ensure that money constantly moves to those who already have money.
It causes social and cultural degradation
The elimination of local opportunities to exchange and relate to one another focuses attention on ways of getting money outside the community. Communities fall apart as they become indebted to entities outside their communities.
To conclude: Think about it. Participating in a Local CES Currency System is going to benefit you, your family, your community; and not only that: You will be making a Financial Statement of Secession. You will be financially voting for Secession!
Is the ANC going to be getting any VAT or tax benefits on your labour, from labour that you exchange via a CES?
You will be Financially Training Daily, for the Political Secession Marathon!
Sources: Alternet :: Community Exchange System :: CES: Join: ZA