Local currencies making a comeback

Private sector co-op currency. From Newsweek:

It’s an attractive idea when times are tight. Communities print what look like ordinary bills with serial numbers, anti-counterfeiting details and images of local landmarks (the Milwaukee River, for instance) instead of presidential portraits. Residents benefit through an exchange system: 10 traditional dollars, for instance, nets them $20 worth of local currency. And when businesses agree to value the funny money like real greenbacks, they also get a free stack to kick-start spending. It’s all perfectly legal (except for coins) as long as it’s not for profit and the bizarro dinero doesn’t resemble the real thing. Dozens of such systems flourished during the Great Depression. In the 1990s, they re-emerged as a way to fight globalization by keeping wealth in local hands. Now the dream of homespun cash is back because it keeps people liquid even if they’re unemployed or short on traditional dollars.

Since BerkShares launched in 2006, almost $2 million has been exchanged for cash, and the equivalent of $180,000 is in circulation. “You can get a divorce, plan a funeral and go to just about any restaurant in town,” Witt says. The biggest downside? Taxes. Even in the parallel world of earning and spending alternative currencies, Uncle Sam gets his cut.

Interesting concept. From a Forbes article from 2006:

The first printing was 2,250 Hours, or the equivalent of $22,500. In the beginning, a few dozen neighbors signed on. Glover systematically gave out Hours to people who agreed to accept Hours in return as payment for goods or services. They printed the names of businesses accepting Hours in a newsletter, so residents would know where to spend their new money.

“A lot of my work in the first few years was facilitating connections for the spending of Hours,” says Glover. In other words, if a business received an Hour, there had to be somewhere to spend it.

Now Ithaca has six denominations. There is the Hour, the two Hour, the half Hour, the quarter Hour, the eighth Hour and the tenth Hour. More than $100,000 worth of Hours have been issued.

Here’s a list of local currencies being used in the world. Here’s the US specifically. There’s quite a lot of them here in my home state of Massachusetts.

Berkshares:
Berkshares

Ithaca Hours:
Ithaca Hours

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