Wednesday, March 30, 2016

#72 CES (Community Exchange System) ... an Autopsy

Community Exchange System 

This, my friends, is unfortunately likely to be a great vivisection. It seems that clowns like to appear in huge glorious and confusing websites that purport to help people, but which unfortunately confront them with many grave misconceptions. I like to try and find names to go with the postings wherever possible. But sometimes I'm greeted with something like this: “Community Exchange Systems Ltd is a not-for-profit company registered under Section 21 of the Companies Act of South Africa.” But names, boys! I want to know who actually wrote the articles. Some alt/comp money activities started in South Africa and Down Under along with actual postal addresses, etc. The name, Tim Jenkin, pops up. Many the works of Riegel are presented with links to PDFs, etc. Tom Greco's essay is included. Many other fine and important links are included. We noticed it has a section on Peak Oil. That should begin to tell you the slant of this website. [2 April, 2016: I was reminded by a reader to include here that were Peak Oil real, there would be no reason oil prices would be as low as they are now. That most people fail to see that everything around them is the result of someone being PAID to do it and drawing the proper conclusions is disconcerting, but we must practise patience, knowing that most people are still sound asleep concerning their lives. This blog is about helping them achieve something when they decide to wake up.]

We don't care about Peak Oil, Global Warming or any of half a dozen other brands of the same cultural Marxism or environmentalism. We're done with it! It's garbage and it stinks. We're not here high minding it to “the masses” out there. The people, who are not masses except to would be rulers, already know what they would do if they had the chance. IF MONEY WERE AVAILABLE they would go out there and earn their own living by their own labour which together constitutes their innate wealth. Their social skills and ability to get along with and befriend others would add to that wealth. Any good and honourable thing that is done in the normal course of business is good will and that becomes part of that wealth. Wealth is not merely things and property it is entirely bound up with earning a living. And by the way, most of us would prefer to live lives knowing exactly what constitutes normal social SANITY and prefer living under the REASONABLE EXPECTATION of continuing peace. We see it as part of our mission to continue to unravel the truth wherever it lies and to question, criticize and tear apart if necessary, any falsehoods that get in the way.

As usual, their words in blue, mine in black:

Why we Need a New Exchange System

Why invent a new exchange system when money seems to do the job?

Because our conventional money-based exchange system is at the root of most of the misery, suffering and problems faced by humanity. It is also the prime factor behind the environmental crises we face.

Emphasis mine. Notice please the attempt to blame it all on money itself rather than the particular type or kind of this universal human invention. No pal, or whoever wrote this, THEIR money, THER businesses, THEIR policies, etc. lie at the root of most of the misery, suffering and problems faced by humanity and furthermore (and indisputably, so it's not even worth objecting) anyone using THEIR money for anything is in complicity with THEIR crimes! Let's please get some perspective here and some truth as well. Ultimately there will be no compromises; those who worked for terrible organizations will have their reputations known by all and then Nature will take its course. There hence MUST ultimately arise money that is not THEIRS.

The money systems we use are not neutral, non-partisan, services provided by our governments. They are a ‘service’ provided by private financial institutions (banks) specifically for their own benefit rather than those who use them. Our conventional money systems only work for those who already have money and marginalise the rest. They are also the fuel that powers the growth imperative of our economies, forcing us all to compete and having disastrous consequences for the health of our planet.

Ditch the health of our planet as THEY are responsible, not us. We abjure any and all blame or guilt for anything we have done. These matters are neutral and irrelevant to our purpose. What we are concerned with is something everyone has a natural right to; the issuance of their own money. We do not circumvent our reality by supposing that there really could be a civilized society without money. We regard such as nonsense, the lies and deceptions of knaves, fools, assorted “do gooders” mindlessly spreading cultural Marxism in all its memes, etc. Our emphasis above indicates where we agree and exactly why an alternative money to THEIRS is clearly in order. No, here's a fool for you:

The main problem with conventional money is that it ‘exists’, or at least we are encouraged by the commercial banks to believe that it exists so that they can continue to ‘lend’ it to us at a price! As such it has to be created, distributed and the amount of it restricted and controlled. As money comes into existence when commercial banks grant loans, every unit in existence is based on a unit of debt. This determines the quantity of money, which has nothing to do with the amount of money people require to live decent lives. Such money is also based on speculation, because it is loaned into existence on the premise that it will be paid back in the future with interest.

This is a largely incoherent jumble. I'm not surprised you didn't get anything from it. The main problem with conventional money is certainly not its existence and saying that it doesn't exist doesn't make it go away either. Let's enumerate and counter some of the points he's trying to make here:

He asserts that the commercial banks encourage us to believe that money exists, when it's a fiction. No. Banks are guilty of much fraud, but foisting magical thinking of this kind on the general public is not one of them. Tell me, how about the money you get after doing a job for someone. Does that money exist? Twerp!

One real fiction is lending at a price, the lent money is created, the interest is not, there's always scarcity in the available money, what does that therefore preclude as an inevitable social result? Before we quite get to that, the bit about money created in this way needing to be restricted and controlled is entirely tied up with the fractional reserve model all banks use. Again, that restriction is necessary based on the actual existence of some money. You can't get around it, so don't try. Solving a problem by throwing away your best tools and accepting someone's useless rubbish (social Marxism) is not going to help. Remember, this is about people and people need to have something they can hold in their hands that represents themselves and the mutual trust they have in other people they deal with. Understood?

As money comes into existence when commercial banks grant loans, every unit in existence is based on a unit of debt.

All money IS instances of debt as it represents uncleared barter transactions: simple as that! If I read this, my first question naturally is what's a unit of debt? If money is as Riegel indicated an instrument to measure value, then what is debt? When one tenders money, one expects to clear one's debt by obtaining value in return. The person receiving my money knows where they can spend that money and in each case the goods/services by themselves backed that money. Understood?

This [bank loans money into existence] determines the quantity of money, which has nothing to do with the amount of money people require to live decent lives.

Correct! So now, how does one bring this about? By conceiving new methods of generating or causing to be generated a market and eventually an economy that will enable attainment of the seeming object of the amount of money people require to live decent lives.

He adds,

Such [loaned into existence] money is also based on speculation, because it is loaned into existence on the premise that it will be paid back in the future with interest.

Of course, and as long as there's finance, there will no doubt be these operations. But there are ways to clean it up that are structural; you have to build them right into the institutions you set up. You intend for your institutions to last so they have to be based on something we can all agree on else trade beyond our backyards is not likely.

Despite its modern electronic trappings, our conventional money systems are a relic of history. They are the latter day equivalent of cattle or gold. The debt-based money system was developed for the industrial revolution to provide a rapidly expanding money supply that could not be provided by a money system based on the quantity of precious metals. This introduced intangible money that did not exist in the same way as earlier ‘hard’ monies, but people continued treating it as a tradable commodity.

The first two sentences we can agree with, the third sentence is not entirely true since we are talking fractional reserve banking here and that goes back into antiquity so this statement becomes misleading. The last sentence is true also but misleading. Money is a tradable commodity, but the “commodity theory of money” that is inextricably tied up with the fractional reserve banking model is obscured. People have to know the reasons THEIR money is really no good long term. This is another reason, and perhaps the most important one, for establishing an alternative money. Any alternative money has to be truly independent of the existing money and must hold its ability to measure value over time, because money must be used to buy everything from the smallest to the greatest possible value and that requires its ability to be honoured as a basis for credit contracts, literally extending payments out up to 49 years in our proposed transparent finance model.  If a currency loses any essential amount of its purchasing power over that period >50%, it really isn't any good.  We get back also into questions like how much is a dozen eggs in Valuns? How much will a dozen eggs be in 20 years, etc.?

Money that ‘exists’ can thus be accumulated like any other commodity. It can also be stolen, traded, collected, destroyed and lost. Its distribution is not based on the delivery of value to others but on the ability of people to ‘make money’. Conventional money has no restraints and always flows away from where it is created and needed, towards the ‘money centres’.

The first great con and by far the most important, is to try and attract customers to a website that will presumably computer account for transactions and say there is no money that actually exists ... when there actually is! The tokens in any monetary system can be stolen, traded, collected, destroyed and lost precisely because they are real. If I say I have a ticket to a show at a certain place, date and time and someone takes my ticket, then they presumably could either sell it for money or go to the show. Real things can and do real things. Meanwhile ...

The CES breaks out of this paradigm by recognising that the electronics revolution has eliminated the need for an exchange medium.

Here we go merrily off the cliff. We have better than 3/4 of the world that is off the grid, off the net, doesn't want to have to give up their identity, etc. but still would like to participate in the wider world, so that they can make the best use in their present situations of what the wider world could provide them. These people have always known how to use paper notes as money without any bank accounts, etc. They work for them, they spend them. The exchange medium IS the message and modern technology gives us the opportunity to disperse and diversify while retaining one absolute standard for all exchanges, the Valun.  

Never before in the history of humankind has it been possible to record accurately who delivers value to whom. Now that this is possible there is no longer a need for an ‘existential’ money; money can at last truly measure the delivery of value and be based on nothing other than the expenditure of effort by people for others. Money is information – a unit of measure – not a thing. 

Actually, the writer reveals his ignorance. They had reasonably good accounting for all meaningful transactions in Babylon with very few circulating tokens. But Babylon was a slave oriented empire and that's what we're all living under at the moment. Oh, you're either in its clutches or you're among its prey, until the real power behind it all, those who presently issue THEIR money, are no more. As I said, like it or not, we are all complicit with that power in its crimes until we renounce the use of THEIR money. The fool jabbers on about money not existing, everyone's fantasy.

If money does not need to exist as a thing it does not have to be created and distributed. People will earn money solely on the basis of their delivery of value to others, not through charging interest, trading it in money markets and a multitude of other ways without delivering anything of real value.

We honestly sympathize with his statements concerning capitalists, but we prefer to get it straight out there in the open. Activities of capitalists are not the same as those of engaging in free enterprise. We aren't about preserving people's “legacy” political and social concepts. We'd prefer the straight unvarnished truth. You have in the developed world tens of millions of out of work people simply because the bigs have swallowed up nearly everything and destroyed wealth in the process as they have eliminated jobs; every single reduction in an income stream for any one person diminishes wealth and of course there's none of THEIR money available except through a loan on terms most would refuse. Over time, that giant sucking sound, which is really the paying on interest from money that was never created in the first place, causes all businesses to feast off each other in order to pay that damned interest. In fact the entire reason why there must be continual growth is to pay off that interest. Money is debt, but debt to whom? THAT's what matters. Do you begin to understand how even well meaning people twist things?

Money that does not exist can never be in short supply, but no one can have more of it than the value they can deliver. No one will be able to take more of the social product than they contribute to it, as they do under our current money system. Wealth will remain where it is created and needed, and not leak away to the ‘money centres’.

Again, we sympathize, but if your first argument is irreparably wrong from the outset, it doesn't much matter where the rest of it goes. People out there would like more money that can actually buy them things probably not offered for sale at Walmart, etc. We are all living under socialized money systems. We know what's wrong with them. Most are becoming aware who exactly is at fault for most of our world's problems and it isn't the 99%. Again, we see any recognition from any of THEIR institutions, paid for in THEIR money as suspect. This goes way beyond Florence King's remark that “Americans have great faith in education but hate the educated.” It recognizes that we have all our lives had to put up with various kinds of social deceits just in order to maintain our lives. When they want to coerce you, they tell you that it's “progressive, up to date, everyone's doing it,” etc. as sold relentlessly over THEIR media outlets to us with all manner of sappy appeals to what's left of our bourgeois morality.

No friends, we want our own money and we want it NOW because it was always our birthright along with all the rest of the freedoms enunciated in the Bill of Rights of the US Constitution! This means we want an entirely new institutionalized structure with different rules that allows all but governments and their creatures (corporations) from entry, that is really and truly private, that eschews capitalism in all its forms, but promotes free enterprise, that distributes money in all its forms including paper tokens, because most of the people out there who could benefit the most from having money don't have any and the means for promoting their natural right to money at this point does not exist.

We do need new exchange systems and money that is actually ours.  We still haven't seen them.  We propose a solution.  The solution might arise somewhere else and take off.  We'd be the first to congratulate them.  But this certainly aint it.  Until it arises, or we bring it about ourselves, we continue to propose our solution, the proposed international standard Value Unit (Valun) and all that may be required to support its use. Oh, one last thing. I'd really much prefer being a part of (a member in) something routinely called a VEN than I ever would a thing called a CES, yeah it smells.

David Burton

Current Hypothetical Value of a Hypothetical Value Unit

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