From: "John Zube" To: "Thomas H. Greco, Jr." References: <007601c0a2a5$9f8a04e0$47910b3f@v4dq1> Subject: 020301 Re: monetary freedom Date: Fri, 2 Mar 2001 22:31:25 +1100 Organization: Libertarian Microfiche Publishing MIME-Version: 1.0 Content-Type: multipart/alternative; boundary="----=_NextPart_000_0011_01C0A368.841A0D40" X-Priority: 3 X-MSMail-Priority: Normal X-Mailer: Microsoft Outlook Express 5.00.2314.1300 X-MimeOLE: Produced By Microsoft MimeOLE V5.00.2314.1300 This is a multi-part message in MIME format. ------=_NextPart_000_0011_01C0A368.841A0D40 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable ----- Original Message -----=20 From: Thomas H. Greco, Jr.=20 To: Turmel Group ; OZLETS ; ECON-LETS@JISCMAIL.AC.UK ; Zube John ; = Kellett Rachel=20 Cc: Davies Roy ; Aldana Mike=20 Sent: Friday, March 02, 2001 3:15 AM Subject: archives Dear John, Thank you for your response to my message to Rachel Kellett regarding = Werner Zimmermann, a founder of the Swiss WIR. There is much important = history to be gathered and preserved relating to WIR and the monetary = freedom movement in general which thrived in Germany, Switzerland and = elsewhere during the mid- and late-twentieth century. The fact that your = father was very much involved in it, and that you yourself have been = such a staunch advocate makes you unique among my many correspondents, = and quite a valuable source. I am amazed at your diligence and = dedication in compiling such huge volumes of money and freedom related = material, particularly since so much of it consists of unpublished = essays and correspondence which is unavailable elsewhere.=20 I strongly believe that the current wave of free exchange advocates = should be aware of the longer-term history of the movement and the = important work that was done previously. There is much to be learned = from the early experiments and experiences and I wish to make known the = fact that you are one of the best sources of this information. I hope = you're making progress on your efforts to catalog the vast amount of = information you've collected and recorded so that it will be easily = accessible to all. I am inclined to circulate your message to the various lists in the = hope that many will find it stimulating and useful. I have added a few = of my own comments [in brackets] below to share my thoughts and to help = clarify for others the meaning of terms that my be unfamiliar. Thanks again for all your good work. Tom Greco From: "John Zube" To: "Thomas H. Greco, Jr." Cc: "Rachel Kellett" ; "R. Davies" = Subject: 160201 Greco Re: Zimmermann Date: Friday, February 16, 2001 2:15 AM John Zube, LIBERTARIAN MICROFICHE PUBLISHING, P.O. Box 52 or 35 Oxley = St., Berrima, NSW 2577, Australia, e_mail: jzube@acenet.com.au Tel. (02) 48 = 771 436. No FAX!=20 Website: www.acenet.com.au/~jzube LMP's website offers a 2,000 pages (almost 5 Mbs) guide to the first = 1545 of the 1667 PEACE PLANS issues that LMP has produced since 1977, = containing, on about 500,000 pages, libertarian and anarchist books, = pamphlets, magazines, newsletters, dissertations, bibliographies, = directories, indexes, essays & articles, letter, review & leaflet collections, etc., with an average = of over 300 pages per microfiche: $ 1 cash each, post_free for orders of = at least 10, or 2 International Reply Coupons or $ 2 other non_cash, = with small cheques not accepted. Has any other individual published more freedom = texts, more cheaply, in any medium? Probably Dr. David Hart, Adelaide, = has, recently, when he published, before he heard about my CD_ROM = initiative, 4 CD_ROMs containing classical liberal writings and he has = over 2 Gbs in readiness for further such issues. Anyone else? A = supplementary LMP list for Peace Plans 1546_1620 can be found on: = http://butterbach.net/lmp/lmp_sup.htm=20 Dear Thomas, my website contains a few short and one longer title by Werner = Zimmermann. Also about half a dozen titles on WIR. [I hope these articles are in English] For a while my father and W.Z. were friends _ but they clashed over = the original Schoenstein_Plan, later developed into the WIR plan and = later, by my father, into various similar plans & experiments under = other names, e.g. SAG & ESAG. My father, Kurt H. Zube, asserted that he himself was largely = instrumental in setting up the WIR project but was then eked out by W.Z. = et al, probably largely because he (Kurt) had a dominating personality = and believed to be smarter than others and showed that belief. So the = others tried to get even with him by trying to outsmart him. W.Z., in = K.Z.'s version, put him down in this WIR plan and personal assertion = "game" and later bragged to him with a remark running something like = this: You thought you were so smart. See where it got you with this = project! _ Well, that is one person's version of it, from hearsay only. = W.Z. would probably have noted down a different version, if he left a = record on this at all. The monetary freedom notions of W.Z. & K.Z. were always rather = limited. They did not go into technical details of monetary freedom and = its requirements, its past experience and future potential, but only = into the technical details of their special monetary or clearing and = credit reform plans, which contained a number of unchecked premises and = prejudices, e.g. on interest. In this they were not alone but had the company of most money = reformers. Karl Walker undertook for many years a similar battle for a = similar project in Germany. Some of his writings are also reproduced in = my series. Klaus Falke, Darmstadt, undertook the latest such experiment = that I know of. All such projects and experiments depend upon a = sufficient loop hole in the law and correct interpretation of the law = and also upon the authorities not passing special laws and rulings = against them or involving them in prolonged and expensive litigation. [Fortunately, the legal obstacles seem much less daunting in our day]. Few of them provided for a wide_enough local shop foundation and = acceptability in the payment of local wages and salaries (usually made = impossible by the laws of monetary despotism).=20 ["Shop foundation refers to the merchandise inventories of retailers = who emit the local currency. These inventories provide the basis for = redemption of the currency in the form of goods. The acceptability of the local currency by workers is ultimately the = requisite element for its long-term viability.]=20 Then there are the various attempts to establish business to business = exchanges or "barter" electronically. I January this year, driving home = from Canberra, I saw from the highway a large sign advertising = "Bartercard" with a web address and the note: 30,000 businessmen can't = be wrong. It may even have been 80,000 businesses. The note on this is = presently out of my reach. But these transactions, by their very nature, = exclude most consumers and employees. And they do not, usually, provide = much local shop foundation. Like LETS, they mobilize only a fraction of = the total exchange potential and are not replacing monetary despotism = but just mitigate some of its evils, in limited spheres. [Right. But they are demonstrating some of the possibilities of = economic democracy and serving as prototypes from which we can learn = more optimal ways of doing it.] Moreover, all of the WIR etc. plans are based upon the wrong = assumption that completely free clearing would not on its own offer = already sufficient advantages but that extra incentives would have to be = offered to make it attractive enough. That is a fundamental error which = none of them ever examined sufficiently, as far as I know. ["Free clearing" refers to the interest-free payment for goods and = services such as takes place in a mutual credit or LETSystem.] J.Z: Under "free clearing" I mean any mutual offsetting or = cancellations of debts that are due. Theoretically not only many but all = exchanges could be settled by clearing. For every credit there is a debt = and all of them cancel each other. Even cash acts essentially as a = clearing certificate, clearing the credit you earned when you acquired = it against the debt you owe when you spend it. For many purchases of = daily needed consumer goods and services cash is an especially = convenient clearing certificate of wide and easy local acceptance and = comes in very useful and easily counted denominations. Even writing a = cheque and using a credit card takes often longer than using this kind = of "clearing certificate" and they need some kind of proof, while the = cash "certificates" are instantly recognizable, at least locally, and = acceptable. The question of interest, covering time differentials, does = mostly not come into it at all. But a clearing centre will have to = charge its fees. They may be CALLED interest. [Few people see the tremendous costs, both direct and indirect, = incurred in their use of official money. Many of these costs are = incurred in the process of savings and investment, which is not handled = by exchange clearing alone.] It is comparable to the present error of e_gold advocates, who imagine = that their clearing accounts would have to be fully covered in gold = ounces, although, clearing, inherently, does already clear one value = against another value and only a value standard has to be agreed upon = and that standard does not require "cover" or "redemption" and a 100% or = fractional redemption fund by the issuer but merely a correct and = accepted definition of it and a free market and publicity for that = accepted value standard, so that all agreed upon exchange media and = clearing avenues, that would use it, could easily use it.=20 [I fully agree. We simply need to agree on what the standard will be = and use it as our "measuring stick" for valuing whatever we trade. The = measure of value and the payment medium can be two different things. = That's the way LETS actually works. We may price things in dollars or = pounds but pay for them using our own locally-created credits, "green = dollars", "acorns," etc. At some point, we will choose more objective = value standards. Instead of dollars or pounds, we will use a kilo of = rice, a kilowatt of electricity, a statistical average productivity = hour, or something else. The most important feature of whatever we = choose to use as a value standard is that it be freely traded in the = market. That establishes at all times its value relative to everything = else.] J.Z.: The "working" of LETS is rather limited, since it does not have = enough local "shop foundation". The offers of the local garage sales and = other surplus goods or spare service capability in homes, are not the = equivalent of the shop foundation in a local shopping centre, of a whole = market for goods and services, that has its world-wide links and = specialists for goods and service supplies. What I can locally buy with = a LETS dollar is only a tiny fractkion of what I can buy with a sound = local, regional, state or federal currency. Even a Woolworth, Coles or = Westfield Shopping Centre Currency would have a thousandfold the = usefulness of a local LETS dollar. Nor would most workers and employees = be satisfied with being paid in LETS dollars all or a large percentage = of their earnings, since most of their spending requires other currency. The kg of rice and the kilowatt hour have numerous different prices or = values, in different locations, times of the year and even hours of the = day. As for any kind of index standard, incorporating working hours or = staple goods or services, there are literally thousands of different = formulas, most of which are NOT suitable for all occasions. Thus "free = choice of value standards" is the only way out and will lead to widely = acceptable standards that are good enough, although not perfect. In many countries now, at least on underground markets, if not open = ones, other national currencies than the own, were or are used as value = standards. E.g. the U.S. $ in Israel, in addition to the official shekel = index and the DM in Yugoslavia. Participating issuers and clearing = partners would "redeem" their certified debts, notes, warrants, = purchasing vouchers, clearing certificiates, "ticket money", in their = own goods and services (giving them shop or debt foundation), or mutually cancel = them, via a clearing center, without having to enter into the business = to supplying not only the goods and services they specialized on, but = also gold in the quantity required to cover all their currently = circulating exchange media. [As E. C. Riegel put it, "gold is but window dressing." What really = backs credit money is the goods and services offered for sale and the = commitment of the issuers to redeem their currency by accepting it in = payment for goods and services.] The very notion that the value of all currently exchanged goods and = services, millions to billions of them, each traded frequently and in = large quantities, should all be "covered" at any time and to the same = value by the accumulation of a SINGLE COMMODITY only, as an alternative and = guaranteeing redemption good, is absurd.=20 [Absolutely] If a banknote or shopping voucher is soundly issued and retrieved _ by = redemption in wanted consumer goods and services, measured in an = accepted gold weight unit, according to its purchasing power on a free = gold market, then it does not require any gold redemption by the issuer = but only gold redemption, at par or close enough to par, on a free gold = market.=20 [Gold would simply provide the value measuring unit. Better still, we = could use some commodity which is more accessible to the ordinary person = and more freely traded. Most of the gold is owned by governments or = banks, which are therefore able to manipulate its price in terms of all = other commodities and services.] J.Z.: Within some limits, by increasing or decreasing their gold = hoardings or penalizing gold trading or regulating or taxing it, = governments can influence the value of gold in the market but in the = long run and in the main they cannot do so but have to follow it. If = they could by mere manipulation give their paper money a fixed gold = value, they would do so. But in any free trading their "paper gold" has = always been depreciating when they did no longer redeem in gold or = merely used a gold weight unit as a value standard. Their fiat cannot = make a gold weight value - but it can partly to almost completely = expropriate a creditor. That gold market would make all the gold in the world accessible as a = redemption fund _ at the free market rate, reckoned in gold weight = value, of any private exchange medium reckoning in gold weight value. [You mean, if anyone wished to own gold, they could buy it with = gold-denominated currency on the open market.] J.Z.: Yes. Compared with that total redemption fund the fund that an individual = issuer (or issuing centre) could offer, would be pitifully small. And = also quite unnecessary. We can make unlimited measurements in meters and = kilograms without having to resort to the originals somewhere stored in = Paris _ or having to multiply them, also e.g. in platinum.=20 [Right] Weight and length measures made up out of any other material and close = enough to the original are good enough for most measuring of weights and = lengths _ in trillions of transactions. Similarly, even a single gold = ounce remaining in the whole world, assuming all others had been buried = or disappeared, industrially used up or permanently hoarded or = transformed into tooth fittings or jewelry, could serve as a value = standard for all transactions. [This is where I disagree. Value is different from weight or length. = The latter are inherent physical characteristics which a single lump or = rod can establish. Value, however, is a subjective quality. Like beauty, = it is in the eye of the beholder. What we speak of as THE value of any = commodity at any time is actually a consensus arrived at in the = marketplace. That price can only be arrived at by competitive bidding, = thus, as I said above, THE MOST IMPORTANT FEATURE OF WHATEVER WE CHOOSE = TO USE AS A VALUE STANDARD IS THAT IT BE FREELY TRADED IN THE MARKET. J.Z.: You are right! My example was an unrealistic exaggeration. If = there were only a single gold ounce left in the world, it would not have = what we now perceive to be the value of an ounce of gold in a free = market, where it competes with millions of other ounces of gold. If only = a single ounce were left, its value, like a very rare jewel or art work, = would be unique and immense. But since gold is not likely to disappear = to that extent and at least an underground market will always exist for = many ounces of gold, an ounce of gold will tend to have a very = relatively stable market value almost everywhere, the more so the more = free production of and trading and pricing in gold is. (Governmental = meddling with forced currencies and with the gold market have led to = large fluctuation of the "value" of gold in terms of paper currencies, = which would not have occurred without this meddling. When governments = sometimes make gold one few escape options then they give it thereby an = exaggerated additional value, which can suddenly collapse then the = interventions are reduced.) These numerous ounces in free trading could = serve as value standard - among all those who agree upon them, for = millions of transactions, valued altogether millions of times as much as = the total value of all gold existing on earth. And the system would work = with least friction and the greatest trust and convenience when all gold = redemption is reduced to purchases of gold on a free gold market, with = currencies denominated in gold weight units. The gold market does not = have to accept all such currencies at par with their nominal value - = only their issues have to do so, for their goods and services and in = payment of debts owed to them. There is also the constant demand e.g. = for jewelry, dental treaments and industrial use which keeps up the = value of gold even if it is not used as one of the main value standards. = And current production is always only a tiny fraction of the total = accumulation of gold and increasing populations have use for an = increased gold stock. The per head quantity of gold remains relatively = stable compared with the fluctuations of most other standards so far = discovered or agreed upon. To be acceptable at least locally as part of a sound currency, a value = standard must not only be freely traded in the market but whatever its = "carrier", the exchange medium, may be (it might be only an electronic = signal) must be traded at or close enough to par with its nominal value = in that value standard. Otherwise this currency will be driven out of = circulation by competing exchange media whose issue and reflux is more = soundly managed. But precisely this continuous rating of exchange media = against their value standard, requires a free market not only for = exchange media but also for their value standards. The errors in the monetary sphere amount to legions and have never = been sufficiently compiled and systematically refuted. Nor have all the = monetary freedom truths been sufficiently compiled and published as yet. = As far as an individual can do so, I try to do that on microfiche but I = am still far behind in publishing all the material that I have = accumulated on this subject and my collection is still very incomplete. [Collecting the materials and refuting errors are two different = things. The latter requires a process of inquiry and dialog - the stuff = of scientific inquiry and academic discourse.] J.Z.: I meant compiling the facts, the theories, the arguments - and = all the refutations - and publishing them sufficiently and clearly and = accessible enough. I find it is terrible when modern free banking = academics still hold with 200 year old errors e.g. on the "real bills = doctrine", just because the refutation of these errors and the truths = about the real bills doctrine haven't been sufficiently publicized. = There is even a vast disagreement on basic terms, like the "banking = principle", with quite different to contrary definitions of it and the = adherents of one definition ignoring the definitions of others and the = realities behind them. I still believe a comprehensive alphabetical handbook on the subject = should be striven for. But an individual on his own can hardly compile = it. He cannot, at present, compile even all the basic texts on the = subject, far less extract and abstract all of them sufficiently. In the absence of a complete and well recorded science on the subject = all kinds of sectarian faiths and dogmas prevail and cause economic = catastrophies when they come to be enforced by laws.=20 Scientific inquiry and academic discourse has not yet brought all the = ideas, facts, opinions and arguments on money and related subject = together but rather provided an excess of dissenting schools of thought, = most of them all too much under the influence of popular prejudices on = the subject. Much more collaboration is needed to get all ideas and facts on this = liberty _ and on all other liberties, on record, and easily, fast and = cheap enough accessible. See the attachments on the CD_ROM project. See also the first 2 links in the new libertarian library project of = John Humphreys: www.geocities.com/libertarian_library/ PIOT, John Zube (Panarchy In Our Time or: To each the government or non_governmental = society of his or her dreams! _ In the monetary sphere this would mean: = To each the exchange medium, clearing, credit and value standard system = of his or her dreams, always at the own risk and expense. No money = monopoly or legal tender (forced acceptance and forced value) power to = anyone.) [Amen.] J.Z: Your own view on the CD-ROM option?=20 How many CD-ROMs would it take to reproduce all relevant books, = articles and discussions? "Society is exchange!" - said Bastiat. So, how come, society ignores = the exchange media, the value standards, and all alternatives in this = sphere as much as it does? Even while all too many of its members = scramble, for decades, to accumulate merely government cash and what it = can buy. PIOT, John. PIOT, John. ------=_NextPart_000_0011_01C0A368.841A0D40 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
 
----- Original Message -----
From:=20 Thomas H.=20 Greco, Jr.
To: Turmel Group ; OZLETS ; ECON-LETS@JISCMAIL.AC.UK = ; Zube = John ; Kellett=20 Rachel
Cc: Davies Roy ; Aldana = Mike
Sent: Friday, March 02, 2001 = 3:15=20 AM
Subject: archives

Dear John,

Thank you for your response to my message to Rachel Kellett = regarding=20 Werner Zimmermann, a founder of the Swiss WIR. There is much important = history=20 to be gathered and preserved relating to WIR and the monetary freedom = movement=20 in general which thrived in Germany, Switzerland and elsewhere during = the mid-=20 and late-twentieth century. The fact that your father was very much = involved=20 in it, and that you yourself have been such a staunch advocate makes = you=20 unique among my many correspondents, and quite a valuable source. I am = amazed=20 at your diligence and dedication in compiling such huge volumes of = money and=20 freedom related material, particularly since so much of it consists of = unpublished essays and correspondence which is unavailable elsewhere. =

I strongly believe that the current wave of free exchange advocates = should=20 be aware of the longer-term history of the movement and the important = work=20 that was done previously. There is much to be learned from the early=20 experiments and experiences and I wish to make known the fact that you = are one=20 of the best sources of this information. I hope you're making progress = on your=20 efforts to catalog the vast amount of information you've collected and = recorded so that it will be easily accessible to all.

I am inclined to circulate your message to the various lists in the = hope=20 that many will find it stimulating and useful. I have added a few of = my own=20 comments [in brackets] below to share my thoughts and to help clarify = for=20 others the meaning of terms that my be unfamiliar.

Thanks again for all your good work.

Tom Greco

From: "John Zube" <jzube@acenet.com.au>

To: "Thomas H. Greco, Jr." <circ@azstarnet.com>

Cc: "Rachel Kellett" <rk@lifeinplastic.com>; "R. Davies"=20 <Roy.Davies@exeter.ac.uk>

Subject: 160201 Greco Re: Zimmermann

Date: Friday, February 16, 2001 2:15 AM

John Zube, LIBERTARIAN MICROFICHE PUBLISHING, P.O. Box 52 or 35 = Oxley=20 St.,

Berrima, NSW 2577, Australia, e_mail: jzube@acenet.com.au Tel. (02) = 48 771=20 436. No FAX!

Website: www.acenet.com.au/~jzube

LMP's website offers a 2,000 pages (almost 5 Mbs) guide to the = first 1545=20 of the 1667 PEACE PLANS issues that LMP has produced since 1977, = containing,=20 on about 500,000 pages, libertarian and anarchist books, pamphlets, = magazines,=20 newsletters, dissertations, bibliographies, directories, indexes, = essays=20 &

articles, letter, review & leaflet collections, etc., with an = average=20 of over 300 pages per microfiche: $ 1 cash each, post_free for orders = of at=20 least 10, or 2 International Reply Coupons or $ 2 other non_cash, with = small

cheques not accepted. Has any other individual published more = freedom=20 texts, more cheaply, in any medium? Probably Dr. David Hart, Adelaide, = has,=20 recently, when he published, before he heard about my CD_ROM = initiative, 4=20 CD_ROMs containing classical liberal writings and he has over 2 Gbs in = readiness for further such issues. Anyone else? A supplementary LMP = list for=20 Peace Plans 1546_1620 can be found on: http://butterbach.net/lmp/lmp_sup.htm

Dear Thomas,

my website contains a few short and one longer title by Werner = Zimmermann.=20 Also about half a dozen titles on WIR.

[I hope these articles are in English]

For a while my father and W.Z. were friends _ but they clashed over = the=20 original Schoenstein_Plan, later developed into the WIR plan and = later, by my=20 father, into various similar plans & experiments under other = names, e.g.=20 SAG & ESAG.

My father, Kurt H. Zube, asserted that he himself was largely = instrumental=20 in setting up the WIR project but was then eked out by W.Z. et al, = probably=20 largely because he (Kurt) had a dominating personality and believed to = be=20 smarter than others and showed that belief. So the others tried to get = even=20 with him by trying to outsmart him. W.Z., in K.Z.'s version, put him = down in=20 this WIR plan and personal assertion "game" and later bragged to him = with a=20 remark running something like this: You thought you were so smart. See = where=20 it got you with this project! _ Well, that is one person's version of = it, from=20 hearsay only. W.Z. would probably have noted down a different version, = if he=20 left a record on this at all.

The monetary freedom notions of W.Z. & K.Z. were always rather = limited.=20 They did not go into technical details of monetary freedom and its=20 requirements, its past experience and future potential, but only into = the=20 technical details of their special monetary or clearing and credit = reform=20 plans, which contained a number of unchecked premises and prejudices, = e.g. on=20 interest.

In this they were not alone but had the company of most money = reformers.=20 Karl Walker undertook for many years a similar battle for a similar = project in=20 Germany. Some of his writings are also reproduced in my series. Klaus = Falke,=20 Darmstadt, undertook the latest such experiment that I know of. All = such=20 projects and experiments depend upon a sufficient loop hole in the law = and=20 correct interpretation of the law and also upon the authorities not = passing=20 special laws and rulings against them or involving them in prolonged = and=20 expensive litigation.

[Fortunately, the legal obstacles seem much less daunting in our = day].

Few of them provided for a wide_enough local shop foundation and=20 acceptability in the payment of local wages and salaries (usually made = impossible by the laws of monetary despotism).

["Shop foundation refers to the merchandise inventories of = retailers who=20 emit the local currency. These inventories provide the basis for = redemption of=20 the currency in the form of goods.

The acceptability of the local currency by workers is ultimately = the=20 requisite element for its long-term viability.]

Then there are the various attempts to establish business to = business=20 exchanges or "barter" electronically. I January this year, driving = home from=20 Canberra, I saw from the highway a large sign advertising "Bartercard" = with a=20 web address and the note: 30,000 businessmen can't be wrong. It may = even have=20 been 80,000 businesses. The note on this is presently out of my reach. = But=20 these transactions, by their very nature, exclude most consumers and=20 employees. And they do not, usually, provide much local shop = foundation. Like=20 LETS, they mobilize only a fraction of the total exchange potential = and are=20 not replacing monetary despotism but just mitigate some of its evils, = in=20 limited spheres.

[Right. But they are demonstrating some of the possibilities of = economic=20 democracy and serving as prototypes from which we can learn more = optimal ways=20 of doing it.]

Moreover, all of the WIR etc. plans are based upon the wrong = assumption=20 that completely free clearing would not on its own offer already = sufficient=20 advantages but that extra incentives would have to be offered to make = it=20 attractive enough. That is a fundamental error which none of them ever = examined sufficiently, as far as I know.

["Free clearing" refers to the interest-free payment for goods and = services=20 such as takes place in a mutual credit or LETSystem.]

J.Z: Under "free clearing" I mean = any mutual=20 offsetting or cancellations of debts that are due. Theoretically not = only many=20 but all exchanges could be settled by clearing. For every credit there = is a=20 debt and all of them cancel each other. Even cash acts essentially as = a=20 clearing certificate, clearing the credit you earned when you acquired = it=20 against the debt you owe when you spend it. For many purchases of = daily needed=20 consumer goods and services cash is an especially convenient clearing=20 certificate of wide and easy local acceptance and comes in very useful = and=20 easily counted denominations. Even writing a cheque and using a credit = card=20 takes often longer than using this kind of "clearing certificate" and = they=20 need some kind of proof, while the cash "certificates" are instantly=20 recognizable, at least locally, and acceptable.  The question of=20 interest, covering time differentials, does mostly not come into it at = all.=20 But a clearing centre will have to charge its fees. They may be CALLED = interest.

[Few people see the tremendous costs, both direct and indirect, = incurred in=20 their use of official money. Many of these costs are incurred in the = process=20 of savings and investment, which is not handled by exchange clearing=20 alone.]

It is comparable to the present error of e_gold advocates, who = imagine that=20 their clearing accounts would have to be fully covered in gold ounces, = although, clearing, inherently, does already clear one value against = another=20 value and only a value standard has to be agreed upon and that = standard does=20 not require "cover" or "redemption" and a 100% or fractional = redemption fund=20 by the issuer but merely a correct and accepted definition of it and a = free=20 market and publicity for that accepted value standard, so that all = agreed upon=20 exchange media and clearing avenues, that would use it, could easily = use it.=20

[I fully agree. We simply need to agree on what the standard will = be and=20 use it as our "measuring stick" for valuing whatever we trade. The = measure of=20 value and the payment medium can be two different things. That's the = way LETS=20 actually works. We may price things in dollars or pounds but pay for = them=20 using our own locally-created credits, "green dollars", "acorns," etc. = At some=20 point, we will choose more objective value standards. Instead of = dollars or=20 pounds, we will use a kilo of rice, a kilowatt of electricity, a = statistical=20 average productivity hour, or something else. The most important = feature of=20 whatever we choose to use as a value standard is that it be freely = traded in=20 the market. That establishes at all times its value relative to = everything=20 else.]

J.Z.: The "working" of LETS is = rather limited,=20 since it does not have enough local "shop foundation". The offers of = the local=20 garage sales and other surplus goods or spare service capability in = homes, are=20 not the equivalent of the shop foundation in a local shopping centre, = of a=20 whole market for goods and services, that has its world-wide links and = specialists for goods and service supplies. What I can locally buy = with a LETS=20 dollar is only a tiny fractkion of what I can buy with a sound local,=20 regional, state or federal currency. Even a Woolworth, Coles or = Westfield=20 Shopping Centre Currency would have a thousandfold the usefulness of a = local=20 LETS dollar. Nor would most workers and employees be satisfied = with being=20 paid in LETS dollars all or a large percentage of their earnings, = since most=20 of their spending requires other currency.

The kg of rice and the kilowatt = hour have numerous different prices or values, in different = locations,=20 times of the year and even hours of the day. As for any kind of index=20 standard, incorporating working hours or staple goods or services, = there are=20 literally thousands of different formulas, most of which are NOT = suitable for=20 all occasions. Thus "free choice of value standards" is the only way = out and=20 will lead to widely acceptable standards that are good enough, = although not=20 perfect.

In many countries now, at least on underground markets, if not open = ones,=20 other national currencies than the own, were or are used as value = standards.=20 E.g. the U.S. $ in Israel, in addition to the official shekel index = and the DM=20 in Yugoslavia. Participating issuers and clearing partners would = "redeem"=20 their certified debts, notes, warrants, purchasing vouchers, clearing=20 certificiates, "ticket money", in their own goods and

services (giving them shop or debt foundation), or mutually cancel = them,=20 via a clearing center, without having to enter into the business to = supplying=20 not only the goods and services they specialized on, but also gold in = the=20 quantity required to cover all their currently circulating exchange = media.

[As E. C. Riegel put it, "gold is but window dressing." What really = backs=20 credit money is the goods and services offered for sale and the = commitment of=20 the issuers to redeem their currency by accepting it in payment for = goods and=20 services.]

The very notion that the value of all currently exchanged goods and = services, millions to billions of them, each traded frequently and in = large=20 quantities, should all be "covered" at any time and to the same value = by

the accumulation of a SINGLE COMMODITY only, as an alternative and=20 guaranteeing redemption good, is absurd.

[Absolutely]

If a banknote or shopping voucher is soundly issued and retrieved _ = by=20 redemption in wanted consumer goods and services, measured in an = accepted gold=20 weight unit, according to its purchasing power on a free gold market, = then it=20 does not require any gold redemption by the issuer but only gold = redemption,=20 at par or close enough to par, on a free gold market.

[Gold would simply provide the value measuring unit. Better still, = we could=20 use some commodity which is more accessible to the ordinary person and = more=20 freely traded. Most of the gold is owned by governments or banks, = which are=20 therefore able to manipulate its price in terms of all other = commodities and=20 services.]

J.Z.: Within some limits, by = increasing or=20 decreasing their gold hoardings or penalizing gold trading or = regulating or=20 taxing it, governments can influence the value of gold in the market = but in=20 the long run and in the main they cannot do so but have to follow it. = If they=20 could by mere manipulation give their paper money a fixed gold value, = they=20 would do so. But in any free trading their "paper gold" has always = been=20 depreciating when they did no longer redeem in gold or merely used a = gold=20 weight unit as a value standard. Their fiat cannot make a gold weight = value -=20 but it can partly to almost completely expropriate a = creditor.

That gold market would make all the gold in the world accessible as = a=20 redemption fund _ at the free market rate, reckoned in gold weight = value, of=20 any private exchange medium reckoning in gold weight value.

[You mean, if anyone wished to own gold, they could buy it with=20 gold-denominated currency on the open market.]

J.Z.: Yes.

Compared with that total redemption fund the fund that an = individual issuer=20 (or issuing centre) could offer, would be pitifully small. And also = quite=20 unnecessary. We can make unlimited measurements in meters and = kilograms=20 without having to resort to the originals somewhere stored in Paris _ = or=20 having to multiply them, also e.g. in platinum.

[Right]

Weight and length measures made up out of any other material and = close=20 enough to the original are good enough for most measuring of weights = and=20 lengths _ in trillions of transactions. Similarly, even a single gold = ounce=20 remaining in the whole world, assuming all others had been buried or=20 disappeared, industrially used up or permanently hoarded or = transformed into=20 tooth fittings or jewelry, could serve as a value standard for all=20 transactions.

[This is where I disagree. Value is different from weight or = length. The=20 latter are inherent physical characteristics which a single lump or = rod can=20 establish. Value, however, is a subjective quality. Like beauty, it is = in the=20 eye of the beholder. What we speak of as THE value of any commodity at = any=20 time is actually a consensus arrived at in the marketplace. That price = can=20 only be arrived at by competitive bidding, thus, as I said above, THE = MOST=20 IMPORTANT FEATURE OF WHATEVER WE CHOOSE TO USE AS A VALUE STANDARD IS = THAT IT=20 BE FREELY TRADED IN THE MARKET.

J.Z.: You are right! My example was = an=20 unrealistic exaggeration. If there were only a single gold ounce left = in the=20 world, it would not have what we now perceive to be the value of an = ounce of=20 gold in a free market, where it competes with millions of other ounces = of=20 gold. If only a single ounce were left, its value, like a very rare = jewel or=20 art work, would be unique and immense. But since gold is not likely to = disappear to that extent and at least an underground market will = always exist=20 for many ounces of gold, an ounce of gold will tend to have a very = relatively=20 stable market value almost everywhere, the more so the more free=20 production of and trading and pricing in gold is. (Governmental = meddling with=20 forced currencies and with the gold market have led to large = fluctuation of=20 the "value" of gold in terms of paper currencies, which would not have = occurred without this meddling. When governments sometimes make gold = one few=20 escape options then they give it thereby an exaggerated additional = value,=20 which can suddenly collapse then the interventions are reduced.) These = numerous ounces in free trading could serve as value standard - among = all=20 those who agree upon them, for millions of transactions, valued = altogether=20 millions of times as much as the total value of all gold existing on = earth.=20 And the system would work with least friction and the greatest trust = and=20 convenience when all gold redemption is reduced to purchases of gold = on a free=20 gold market, with currencies denominated in gold weight units. The = gold market=20 does not have to accept all such currencies at par with their nominal = value -=20 only their issues have to do so, for their goods and services and in = payment=20 of debts owed to them. There is also the constant demand e.g. for = jewelry,=20 dental treaments and industrial use which keeps up the value of gold = even if=20 it is not used as one of the main value standards. And current = production is=20 always only a tiny fraction of the total accumulation of gold and = increasing=20 populations have use for an increased gold stock. The per head = quantity of=20 gold remains relatively stable compared with the fluctuations of most = other=20 standards so far discovered or agreed upon.

To be acceptable at least locally as = part of a=20 sound currency, a value standard must not only be freely traded in the = market=20 but whatever its "carrier", the exchange medium, may be (it might be = only an=20 electronic signal) must be traded at or close enough to par with its = nominal=20 value in that value standard. Otherwise this currency will be driven = out of=20 circulation by competing exchange media whose issue and reflux is more = soundly=20 managed. But precisely this continuous rating of exchange media = against their=20 value standard, requires a free market not only for exchange media but = also=20 for their value standards.

The errors in the monetary sphere amount to legions and have never = been=20 sufficiently compiled and systematically refuted. Nor have all the = monetary=20 freedom truths been sufficiently compiled and published as yet. As far = as an=20 individual can do so, I try to do that on microfiche but I am still = far behind=20 in publishing all the material that I have accumulated on this subject = and my=20 collection is still very incomplete.

[Collecting the materials and refuting errors are two different = things. The=20 latter requires a process of inquiry and dialog – the stuff of = scientific=20 inquiry and academic discourse.]

J.Z.: I meant compiling the facts, = the theories,=20 the arguments - and all the refutations - and publishing them = sufficiently and=20 clearly and accessible enough. I find it is terrible when modern free = banking=20 academics still hold with 200 year old errors e.g. on the "real bills=20 doctrine", just because the refutation of these errors and the truths = about=20 the real bills doctrine haven't been sufficiently publicized. There is = even a=20 vast disagreement on basic terms, like the "banking principle", with = quite=20 different to contrary definitions of it and the adherents of one = definition=20 ignoring the definitions of others and the realities behind = them.

I still believe a comprehensive = alphabetical=20 handbook on the subject should be striven for. But an individual on = his own=20 can hardly compile it. He cannot, at present, compile even all the = basic texts=20 on the subject, far less extract and abstract all of them=20 sufficiently.

In the absence of a complete and = well recorded=20 science on the subject all kinds of sectarian faiths and dogmas = prevail and=20 cause economic catastrophies when they come to be enforced by laws.=20

Scientific inquiry and academic = discourse has=20 not yet brought all the ideas, facts, opinions and arguments on money = and=20 related subject together but rather provided an excess of dissenting = schools=20 of thought, most of them all too much under the influence of popular=20 prejudices on the subject.

Much more collaboration is needed to get all ideas and facts on = this=20 liberty _ and on all other liberties, on record, and easily, fast and = cheap=20 enough accessible. See the attachments on the CD_ROM project.

See also the first 2 links in the new libertarian library project = of John=20 Humphreys:

www.geocities.com/libertarian_library/

PIOT, John Zube

(Panarchy In Our Time or: To each the government or = non_governmental=20 society of his or her dreams! _ In the monetary sphere this would = mean: To=20 each the exchange medium, clearing, credit and value standard system = of his or=20 her dreams, always at the own risk and expense. No money monopoly or = legal=20 tender (forced acceptance and forced value) power to anyone.)

[Amen.]

J.Z: Your own view on the CD-ROM = option?=20

How many CD-ROMs would it take to = reproduce all=20 relevant books, articles and discussions?

"Society is exchange!" - said = Bastiat. So, how=20 come, society ignores the exchange media, the value standards, and all = alternatives in this sphere as much as it does? Even while all too = many of its=20 members scramble, for decades, to accumulate merely government cash = and what=20 it can buy.

          &nbs= p;  =20 PIOT, John.

          &nbs= p;            = ;            =     =20 PIOT, John.

 

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