The Future of Money:
Creating New Wealth, Work, and a Wiser World
by Bernard Lietaer
The following bullets are reality-checks extracted from The Future of Money (published in January 2001, also available in German from http://www.futuremoney.de), illustrating the dramatic changes we face in the near future.
- Your money's value is determined by a global casino of unprecedented proportions: $2 trillion are traded per day in foreign exchange markets, 100 times more than the trading volume of all the stockmarkets of the world combined. Only 2% of these foreign exchange transactions relate to the "real" economy reflecting movements of real goods and services in the world, and 98% are purely speculative. This global casino is triggering the foreign exchange crises which shook Mexico in 1994-5, Asia in 1997 and Russia in 1998. These emergencies are the dislocation symptoms of the old Industrial Age money system. Unless some precautions are taken soon, there is at least a 50-50 chance that the next five to ten years will see a global money meltdown, the only plausible way for a global depression.
- The Information Age has already spawned new kinds of currencies: frequent flyer miles are evolving toward a "corporate scrip" (a private currency issued by a corporation) for the traveling elite; a giant corporation you never heard of is issuing its own "Netmarket Cash" for Internet commerce; even Alan Greenspan, Chairman of the Federal Reserve, foresees "new private currency markets in the 21st century."
- Exorbitant compensations are paid to the very few at the top: it started with movie stars and sports heroes, and has now spread to top lawyers, traders, doctors, and business leaders. In the 1960’s CEO’s salaries were only thirty times greater than those of the average worker, compared with two hundred times today. Is this the dawn of a society where "Winner-takes-all" or a short-term last gasp of the transition out of the Industrial Age?
- 1,900 local communities in the world, including over a hundred in the US, are now issuing their own currency, independently from the national money system. Some communities, like in Ithaca, New York, issue paper currency; others in Canada, Australia, the UK or France issue complementary electronic money.
- The value of barter transactions — exchanges which do not use any money as medium of exchange - totaled almost $6.5 billion in 1994 in the US and Canada, and is increasing three times faster than normal exchanges. The magazine "Barter News" covers the industry’s development and now has 30,000 subscribers. It estimates the total barter worldwide at $650 billion in 1997, and growing at an annual rate of 15%.
All of the above is part of an irreversible process of change in our money system and our societies. We are now in a transition period, an interval of great risk but also of great opportunity. The risks are not only financial, some of the emerging money technologies could create a society more repressive than anyone of us thought possible. More importantly major opportunities are also becoming available: now more than ever it has become possible to address some of the most critical issues of our times, such as enabling more meaningful work, fostering cooperation and community, even realigning long-term sustainability with financial interests. None of this is theory, real-life implementations have pragmatically demonstrated such results. Combining these innovations can make available a world of Sustainable Abundance within one generation.
Specifically in Europe, the traditional ways to handle unemployment are increasingly failing. In areas with high unemployment, people have already demonstrated that living conditions can be significantly improved by creating their own complementary currencies instead of just relying on welfare. Surprisingly, it is in fact not the first time that such solutions have been successfully implemented in the Modern world. During the 1930’s many thousands of such initiatives were operational in the US, Canada, Western Europe and other areas affected by the Depression. Complementary currencies could become a key tool to buffer a region from the shocks caused by failures and crises in the official money system. Finally, this approach is a win/win for both locally owned businesses and society at large.
The degradation of the environment due to short-term financial priorities can similarly be addressed with pragmatic money innovations. Short-term thinking is shown not to be due to human nature, but to the prevailing money system. It is also possible to reverse this process, by using a currency designed specifically for multinational trade and contracts which would make long-term thinking a spontaneous process, focusing the attention on long-term sustainable solutions without the need for regulations or taxation. Historical precedents have proven such results, some of them lasting over several centuries.
Introduction
Three Promises, Underlying Viewpoint
Chapter 1: Money - The Root of All Possibilities
- Age Wave
- Information Revolution
- Climate Change and Biodiversity Extinction
- Monetary Instability
- Money at the Core of the Time Compacting Machine
The Time-Compacting Machine
What is Sustainable Abundance?
What Prevents Sustainable Abundance?
Four Seasons in 2020
- Spring
Summer
Fall
Winter
Creating Sustainable Abundance with Complementary Currencies
A Road Map to Your Money, Your Future
PART ONE: What Is Money?
Synthesis of Part One
Chapter by Chapter Outline
A Primer on How Money Works
"Your" Money
How does Banking Work?
- How Did Banking and "Modern" Money Start?
The Secret of "Modern" Money
Credit Markets
Your Savings: Storing Value
- A Scorecard
Real Estate
Stocks
Bonds
Currencies
Central Banks and Other Firemen
- National Level
"Money’s Family Portrait"
Money as a System
- The Firemen’s Viewpoint
Back Full Circle to You
Chapter 2: Today’s Money
A "Simple" Question
Where is the money mystery coming from?
- The History of Money
The Needs of the Confidence Game
Why Money is not a Thing
A Working Definition of Money
The Origin of Money’s Power
- Money Shifts and Power Shifts
Today’s Money
- Four Key Design Features
The Effects of Interest
What next?
Chapter 3: Cybersphere--The New Money Frontier
Post-Industrial Society=Knowledge Age
- The Nature of Information
Implications for the Economy and Society
The Positive Forces, The Negative Forces
- Distribution and Retail
Implications for Money
- Payment Systems
New Money
Implications for Banks and Financial Services
Wisdom in the Information Age?
Chapter 4: Five Scenarios for the Future
Scenarios - Windows on the Future
The Official Future: "More of the Same"
Why the Official Future is Not Going to Happen
The Corporate Millennium
Timetable for the Transition
How is this Possible?
- The Case of the Stealth Mega-Store
From Information Age to Corporate Millennium
Careful Communities
- Assessing Possibilities of Breakdowns
The Forces Feeding "Careful Communities"
Hell on Earth
Sustainable Abundance
The Four Scenarios in Perspective
The Two Driving Forces
PART TWO: Choosing Your Future of Money
Chapter 5: Work-Enabling Currencies
An Important Distinction
Unemployed? Who? Me?
The Path not Taken in the 1930s
Today’s systems
Conclusion: Complementary Currencies as ‘Early Prototypes’.
Chapter 6: Community Currencies
Community Breakdown
Currencies that Build Community
Complementary Currencies in the Information Age
Conclusions
Chapter 7: Some Practical Issues
Complementary Currencies, Legal and Tax Authorities
Complementary Currencies, Central Banks and Inflationary Pressures
Elements for a European Social Policy for the Information Age
How to Start Your Own Complementary Currency
Chapter 8: A Global Reference Currency - Making Money Sustainable
Long-term Sustainability
Positive Results of the Modern Money system
Status Report on Biosphere Earth
The Three Tools of Persuasion
Relationship between Money systems, Time Perception and Sustainability
Far-Seeing Glasses?
A Global Reference Currency (GRC) and the Terra Unit
Terra as a Business Initiative
Chapter 9: Sustainable Abundance
A Visit to the Stanford Campus
Towards an Integral Economy?
The Three Waves toward Sustainable Abundance
A Monetary System for Sustainable Abundance
The Four Seasons of 2020 Revisited
The Four Scenarios Revisited
Conclusion
Epilogue and Prelude
http://www.transaction.net/money/book/index.html
zisk@well.com
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