Annual Report

The current White House’s administration also has been trying to simplify it all for borrowers with loans backed

Borrowers can expect savings, but the banks aren’t required to give them today’s rock-bottom rates. Under the settlement, the new rate must be at least 0.25 percentage point

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Biográfia (Hungarian)

Biográfia (Hungarian)

Bernard Lietaer, a Pénz Jövője (18 nyelven lefordítva) című könyv szerzője, valutarendszerek tervezésével és megvalósításával foglalkozó nemzetközi szakember. Több mint 30 éve tanul és dolgozik...

Bernard Lietaer

Bernard Lietaer

Bernard Lietaer est l’un des architectes originels de l’ECU, le mécanisme qui a mené à la monnaie unique européenne. Il est l’auteur de l’ouvrage  Of Human Wealth : Beyond Greed and Scarcity et...

Money and Sustainability, The Missing Link

Money and Sustainability, The Missing Link

Pioneering new research from the Club of Rome In 1972, the first Report for the Club of Rome – The Limits to Growth – famously spelled out the unsustainable consequences of an economic system...

Community Solutions: An Overview

Community Solutions: An Overview

To understand why the introduction of complementary local currencies is essential to community revitalization and sustainable development, it is critical to first understand the monetary...

What is the Problem with our Current Money System?

What is the Problem with our Current Money System?

Our modern monetary systems share in common the fact that they consist of a nationwide, government-enforced monopoly of a single type of currency, created by banks through loans attached to...

Community Solutions: An Overview

To understand why the introduction of complementary local currencies is essential to community revitalization and sustainable development, it is critical to first understand the monetary underpinnings of pervasive community challenges such as unemployment, lack of adequate housing and schools,  environment-adverse practices, erosion of community fabric and civic engagement etc.   First, local shortages of national currency engender a significant bottleneck when it comes to optimally connecting locally unused resources with unmet needs.  And, second, the process by which increased use of conventional money to obtain services which used to be provided by family and mutual exchanges among neighbors, progressively erodes the very fabric of community.

Shortages of National Currency

National currencies are ill equipped to meet the needs of many communities because they are too scarce to optimally connect untapped resources and unmet needs.   This problem is compounded by a highly skewed distribution of wealth in most countries.  Places with the highest rates of unemployment are often the very same places where communities’ needs are least met.  Communities that are cash poor  constantly find themselves in a predicament whereby many of their most valuable assets (such as their inhabitants’ skills and talents) remain vastly unutilized or underutilized while many needs (for more and better housing or teachers, or cleaner streets) remain unmet.   Lack of cash is a key reason why many communities are unable to “put people to work.”   They are simply unable to pay for people to get things done.   Money scarcity is the result of joblessness, and the scarcity in jobs is a result of money scarcity. We are dealing with a classical case of “mutual causality.”

I invite you to play the sufficiency of money game if you would like to understand why communities do in fact have much of what they practically need to flourish, once the bottleneck of money is removed from the equation.

The Community-eroding Effects of National Currency Exchanges

Our second claim is that the increased use of conventional money to obtain services which used to be freely provided by family and neighbors progressively erodes the very fabric of community.  To understand how community is lost, we must find out how it is created.   If community were a fabric, what would be the individual thread?  Or to use another metaphor, if community were a molecule, what would be its constitutive atom, the smallest act that creates it?

Anthropologists have found that the single most important act for community-building is the  reciprocity in gift exchanges.   If you need a box of nails, you go to the hardware store and buy one.  There is no expectation by either you or the shop assistant that any future reciprocity is involved.   This is one of the main reasons why monetary exchanges are so efficient.  Each transaction stands on its own.  However, no community has been created either.  Now, assume that you go out for another box of nails, and that your neighbor is sitting on his porch.  When you tell him you are going to buy a box of nails, he responds, “Oh, I bought six boxes just the other day.  Here is one, it will save you the trip to the hardware store.”  He also refuses your offer to pay.   What has happened?   From a purely material viewpoint, in both cases you end up with your box of nails.  But an anthropologist would point out that in the second case something else has happened as well.   When you meet that neighbor again, you will definitely say hello.  And if ever on a Saturday night he rings your doorbell because he forgot to buy some butter, you will most likely share some of yours.  The gift of the box of nails is a community-building act.  Its purchase is not.  A commercial transaction is a closed system: the nail versus the money.  In contrast, a gift is an open system.  It leaves an imbalance in the transaction that some possible future transaction completes.   The gift process creates something that the monetary exchange does not.  An new thread has been woven into the community fabric.

Conventional money is simply not compatible with gift exchanges: just try to give a national currency bill as a birthday gift to your boy- or girlfriend, and you may discover empirically the nature of the problem.

Monetary Solutions for Building Community and Leveraging Local Assets

If national currencies are scarce, why not create your own money in sufficiency to complement the scarce national currency, to enable more work to be paid and more needs to be met?  Sounds crazy?  Too simple?   It is nevertheless what hundreds of communities in various parts of the world have already done.   They have introduced a dual currency system to solve their shortage of national currency, and empirical findings also reveal that these community currencies are more compatible with gift exchanges than conventional national money. We had mentioned earlier that when money gets involved, community breaks down.   However, this turns out to be true only when scarce, competition-inducing currencies, such as our official national currencies are involved.  In fact, the use of community currencies can have exactly the opposite effect and actually help build community, because they have reciprocity built in, which are more compatible with a gift economy.

You can find a summary overview of some of the  best known community currencies here.   Most of these systems are designed to remain small scale, and most don’t grow beyond the scale of about 500 participants. They play the role of the capillaries in our blood circulation system, a role which is great on its own scale. They are therefore best organized on a decentralized, local, way.

I have shown in The Future of Money (1999) that the effects of such community currencies are positive, and that, if properly designed and implemented, they do not actually create inflation.  They are very effective ways of encouraging elderly care (e.g. Fureai Kippu in Japan) or fostering stronger community ties in neighborhoods (e.g. Time Dollars and LETS systems), or fostering regional development (e.g. Chiemgauer in Southern Bavaria, and other German regiogeld systems).

Learning More

For more detailed overviews of the nature and benefits of community currencies, I recommend Chapter 6 of The Future of Money (let’s Scribd that chapter and link it here) as well as an excellent essay by Margrit Kennedy entitled Complementary Currencies: New Paths to Sustainable Abundance.   If you are a community currency practitioner, or would like to explore implementing a community currency in your own community, I recommend looking up these  community links and resources.

What is the Problem with our Current Money System?

Our modern monetary systems share in common the fact that they consist of a nationwide, government-enforced monopoly of a single type of currency, created by banks through loans attached to positive interest rates, and naturally or artificially kept scarce.   While these particular features of our money system have permitted the accumulation of capital that enabled rapid industrialization during the modern era, they also have a number of hidden but far-reaching counterproductive side effects.

The use of positive interest alone is responsible for driving (1) the short-term thinking that drives our economic decisions, (2) the relentless pressure for economic growth which feeds hyper-consumerism; (3) growing inequities; (4) the greed and rampant speculation which regularly make the front page of our media, (5) and the weakening of social ties and erosion of community.   I have written more at length about these dynamics in my booksarticles, and interviews, but I invite you to read a brief overview of the main effects of interest to understand how our national currencies generate competition and erodes community.

From Monopoly to Monetary Ecology.  To be clear, the problem is neither our national currencies nor the use of interest per se, but the monopolistic use of these types of currencies which are only well-suited for certain purposes but not for others.   The fundamental problem with our current monetary system is that it is not sufficiently diverse, and as a result it dams and bottlenecks our creative energies, and keeps us trapped in a world of scarcity and suffering, when we actually have the capacity to create a very different reality.   Our conventional money facilitates particular types of (commercial) flows but does not adequately support other types of flows within communities.   When a broader spectrum of currencies is in place, people can complete more transactions, enabling more people to meet their needs and enter into exchange relationships.  Because complementary currencies do not bear interests and are issued in sufficient supply, they encourage cooperation amongst participants, and can counterbalance some of the side-effects of conventional money.

Biologist Elizabeth Sahtouris once asked: “How would a body survive if we decided that all the blood should go to the brain or the liver, or certain organs should only be irrigated with blood on certain conditions?” This is precisely what is happening to our world economy under a monoculture of national currencies that are distributed based on a centralized decision making system controlled by a few financial institutions.  All the blood (dollars, euros etc.) is being sent to specific organs that are supplied while others (communities and regions) are often starved to death.  When they are not properly counterbalanced by complementary currencies, national currencies promote embolism (which is the accumulation of blood in one place).

Adopting a diversity of currencies is just as important to human survival as biodiversity is to the fate of the earth.  This is not a metaphor. Our peer-reviewed scientific research on the conditions under which complex flow networks are sustainable demonstrates that money systems share with natural ecosystems the need for a higher diversity and interconnectivity.  The conclusion: to ensure such diversity, we need to actively support the circulation of different types of currencies for different types of purposes.    Promoting a healthier monetary system requires the use of three different kinds of currencies alongside our national currencies: (1) an inflation-proof global complementary currency designed to stabilize the world economy;  (2)  business-to-business currencies designed to counteract the effects of conventional money shortages during periods of economic crises and  contraction; and (3) community currencies that address a variety of social problems and strengthen the fabric of society.

Revising our agreements around money.  Most of the fundamental rules and agreements we have around money were created centuries ago, at a time that was widely different from ours, and by a small group of stakeholders concerned with a narrow set of interests.  As a consequence, they are ill-equipped to serve the challenges and objectives of our current world.   As long as our monetary system remains a blind spot to us, we remain unable to alter its powerful influence on the way we think and act.  As soon as we gain monetary literacy, we can begin examining the nature and implications of the monetary agreements in which we unconsciously participate.  We can start identifying the conditions under which they serve or do not serve the needs of our times, and begin create agreements that better serve our needs.

Is Now the Right Time to Start Investing in CryptoCurrency

These days more and more people are becoming aware of cryptocurrency to the point where the concept has solidified itself in the public conscience. Even if a large percentage of people have no idea how these currencies work or what it is even really for, the crypto trading market has boomed over the last few years from a niche interest to a full-blown financial movement in its own right.


What is Cryptocurrency?

Cryptocurrency in its simplest sense is a digital currency that isn’t regulated or represented by a state. There are many different cryptocurrencies out there (such as Bitcoin and Dogecoin), but they all function in the same basic way, often with different levels of acceptance and security.

Cryptocurrencies exist on and are traded exclusively over the internet, which has been a source of both positive and negative press over its existence, but it is a necessity for the currencies to function. Being online allows instant transactions that are verified by a huge network of connected users in an accessible yet incredibly secure system.


What is Cryptocurrency for?

The majority of people who own some sort of cryptocurrency often only own shares in currencies to trade with as opposed to having the balance in a spendable wallet. This was never its primary function but was a result of the incredible worth that was almost immediately found in this genre of currency. Currencies such as Bitcoin can now be spent on a huge variety of websites and there is an ever-increasing number of cities around the world now installing bitcoin ATMs to facilitate the trading of such coins! You can even find your local ATM at findbitcoinatm!


Should I invest?

Over the few short years that cryptocurrencies have existed, they have been known to be fairly volatile, but it always worth remembering the tale of the humble Bitcoin, which were worth under $100 when they first hit the public eye before very quickly being worth 4 digits for a single coin!

However true this might be, all currencies dip and rise over time, so much more important than the history of a currency is the present. If you’re thinking of investing to make money, you want to be looking at the better-established currencies and those are often very expensive for even a share in a coin. If this isn’t enough to deter you, then you should read on to see if you have what it takes.


Crypto and Covid-19

While many industries have dipped hard as a result of the Covid-19 pandemic, many cryptocurrencies have seen meteoric rises in value. As faith in governments diminishes, Bitcoin, Etherium, and other big names in the industry have shown their worth in having economic strength with people rather than states.

As a result, more and more people are finding success in the crypto trading scene, and there are huge profits to be mined. There is of course risk in any sort of trading for profit, but the uncertain climate of modern times has actually shown us that there can be some sort of stability found in cryptocurrency.


Popularity is loss

Unfortunately, the more money there is to be made with something, the more people there are who want to be a part of it. And as is inherent with cryptocurrency, its worth increases the more people want to use it. This means we could be very swiftly approaching a point where cryptocurrencies are worth too much for the layman to get involved, which is something to keep in mind.


Trading Apps

If you are thinking of getting into some crypto investments, there is an incredible array of apps and websites which will allow you to securely and easily sign up for a wallet for your chosen currency and start trading in just a few minutes. You often can’t withdraw your coin balance for private usage and trade, but for the common user, these apps provide more than enough usability to allow you to trade your way to profit soon!


In my opinion, now is definitely the most optimum time to invest in some cryptocurrency. Ideally, we would have all invested in Bitcoin a decade ago, but seeing as we didn’t, today’s market is incredibly diverse, but has been skyrocketing up and shows no signs of stopping. Not until we no longer need a decentralized currency.

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