Monday, November 7, 2016

#103: An Updated Summary of the Proposal

Since we need to spread the word simply and clearly, we'll state the features of the proposal as simply as we can:

A: What is the basis of your money? 

Q: The proposed money is based on people rather than things. Money begins its life from its issue, when it is exchanged for something in a trade (when one buy's something with it) and travels around in trade in a community or market until it buys something that depreciates and thereafter that money is destroyed, never to return. That is the lifespan of money; it is born, it does its work in exchange for real goods and services, and then it dies, hence:

Money is not a static quantity but must be a renewable resource or economies (co-moneys) die.

We placed this statement apart as it is not only obvious, but this is where our economic understanding differs most radically from anything in standard academic economics: our understanding is more analogous to electrical theory. 

Our proposal is based on the extension of the Rights of Man; the right of everyman / everywoman to issue his/her own money as a literal extension of their individual will, resulting in a truly natural democratic order. I said a democratic order as it would be horizontal not vertical and without the organizational vertical, there is no need for representation or a republican form of anything, except in one place; each exchange would offer people to a rotating council that would be in charge of IVES, the service organization for all the independent exchanges. 

According to Riegel, any other money issuance is illegitimate and leads to ultimate economic failure, usually under terms of totalitarian tyranny, which also fails as a natural concept, since all centralized controlled, planned, etc. systems expect to run successfully against nature. As Riegel and others have noted, THEY prefer price inflation (largely to hold up the spurious value of their securities markets) so that over time THEIR money must lose its value no matter what fiscal or monetary policies are followed. Those policies after all are just more indications of the dubious but deliberate manipulation of THEIR system that it relies on such things to preserve its economy, co-money, intact. 

Want stable prices, enough money but never too much, money that is backed by the people's labour and split-bartered for available goods as all money has ever been used down through time? Then work to implement this Valun solution.

Q: Where does it all start? 

A: With each of you: with each one of us, word of mouth, eye to eye, grassroots, community to community. It begins with the formation of a business entity, perhaps called IVES, the International Valun (Value) Exchange Society. This business would be tasked with managing certain necessary internal bookkeeping tasks for all of its local exchange members, which would be something more than franchises, but less than wholly owned subsidiaries. In fact IVES would be the servant of all the member exchanges.
I recall inventing this image for IVES, It is a seal in the style of a rock, a stone with the engraved lettering IVES, representing the earth, the third rock from the sun, etc. Always to be printed in gray granite black and white. The IVES seal seemed to me at the time to show the basic idea that I wanted people to understand: our monetary system represents the ground, the rock, from which all things including ourselves spring forth.

But there's one thing I need everyone to understand; money has no meaning whatever unless it is exchanged with other people. It actually proves its power and usefulness only by how many people understand, accept and use it. In accomplishing split barter, its primary function, money enables us to save time and build wealth, which must provide an income, a livelihood. Money supports and helps sustain and build the cornerstones of society, beginning within each local community. Money is a tool separating the civilized from the savage, who have relied on whole barter since forever.

Particularly in these times, if you care about civilization or even the preservation of the planet itself, this is as important and serious an idea to consider and pursue as any material preparations you might be making for when times really get rough. If you want a future free of THEM (globalists, central bankers, elites), then you will need your own money, because money is literally the basis of any civilized human organization – and right now, our enemies have a monopoly over it and to that extent have unwarranted control over us.

The solution, the proposal presented here, is designed to beat any of THEIR brands of THEIR money at preserving purchasing power; it will retain its purchasing power over all others because its present value of a transaction at a stated time basis stands athwart their outdated and self-serving commodity basis for money (self serving in that THEY love to speculate on commodities as it makes THEM money on money without any actual work).

Q: What is the name of your unit of exchange: money? 

A: We used E. C. Riegel's name for it. It's called a Valun [VAL-un] – a value unit – although it could be called by other names as long as the same structure and rules were to apply.

Q: What is your money based on? 

A: A unit of purchasing power involving a transaction for 1 oz of gold on a specific date stated in any of THEIR money that can trade for gold divided into a thousand parts, the date identified as the Valun inception date. Each day, the present value of that transaction is calculated based on THEIR prices for gold (we also take silver and maybe later platinum in trade) and the result in THEIR other currencies represents the present fair trade value of a Valun in THEIR money. (On 11/7/16 V1 = $2.72. See the present value of a proposed Valun here.)

All exchanges of THEIR money for ours are one way trade as there is no point in trading out of the basic currency of the people, unless you intend perhaps some form of money laundering, which this completely eliminates.

Q:How does one participate in this proposed monetary system?

A: Each human being above the age of 18 in the United States (there may be more lenient rules in other countries) would be entitled to become an A member, an OWNER, in their community independent exchange or IE (which includes a percentage ownership in IVES). Each A member will pay the value of V1 per year as dues. Each A member must be recommended by two other A members (Technically: It takes an agreement among three people to start an IE, each recommended by the other two.) and be entitled to live where they reside: our domicile rule. 

Certain provisions will probably be made for the homeless; they will need to abide by the same rules, approval by two A members and a connection with the area in which they are homeless. This proposal is humanitarian at its roots, because it all comes forth from us not from THEM (globalists, central bankers, elites) and must be PRIVATE or it simply wont work. 

In order for anything to be worthwhile, it must be OWNED by the people that use it. That way, it gets better looked after, taken care of, runs better, etc. In fact the independent exchanges would become your spaces for gathering and discussing things relating to work, business, jobs, goods for sale, etc. Money is not just tokens, they're the visible part of an accounting machine and the offices in which these activities are centered will also feature ads for jobs and goods for sale in Valuns.

Will there be some internet presence? Probably. But most of us live in the actual brick and mortar world and want to make things, grow things, develop new services, new appliances, new ideas that otherwise would require THEIR money, etc. This proposal will only work if people really use it in their daily lives.

Q: Where are your offices?

A: Since this is intended to be a PRIVATE business, our premises will always be on PRIVATE property and access will be PRIVATE; NOT open to the general “off the street” public. Each local center will be called an exchange. The business of these exchanges will be the settlement of the accounts of its members; literally the movement of Valuns between accounts. Eventually, there may be smaller offices located in various places; Valun counters. These would carry on certain services, gather transaction traffic that will be processed at the main exchange office. 

Q: How will we spread news of this business? 

A: For now, word of mouth and eye to eye. Recall that money derives from “one eye” which was usually that of the potentate whose image was usually stamped in profile on THEIR coins; the “heads” side. Some of you can bring up and print out everything on this blog and spread it around. This is right now an “open source” idea and isn't likely ever to be otherwise.

Q: What do you stand for? 

A: The rights of individual (not collective) will, liberty and property (acquired by honest means) and the Bill of Rights from the US Constitution. I also support the Declaration of Independence as the founding document of the American republic. I prefer civilization to barbarism, refined culture to vulgar, quality to shoddy, rationality to anything else, truth to lies, SANITY to insanity and the wish to live a life in REASONABLE EXPECTATION of continuing peace as opposed to war, confusion, hostility, etc. and a final end to war and poverty.

Q: What do we get for joining? 

A: Each A member gets an account, an A member account. B member accounts are for businesses that join the exchange. Each account belongs to the members, not the exchange. The exchange does NOT lend money, nor is there anything like fractional reserves to worry about. There is no need for deposit insurance. All the Valuns in your accounts are yours. If you want to invest your money in a B member business or have any other reason to borrow money, you will have to contract for that with a member business set up to handle financial traffic. If any financial business fails, there is no cascading effect on the rest of the system.

Since usury, specifically defined as asking back from uncreated money as is practiced in THEIR system, is NOT allowed in ours, all the costs of borrowing money will have to be paid up front or in the case of purchases of capital goods, the lender would buy the asset at a lower price and sell it back to the borrower for more money over a longer series of installment payments covered by a Credit Contract as described on this blog. Either of these methods removes the onus of usury from the system. Lenders of Valuns will of course need to have those Valuns from their credit contractors, since they will not be able to issue Valuns from STOLEN fiat (credit) as is done in THEIR system.

Oh and of course, everyone gets 200 Valuns (V200) to start. That's the “you're at GO, collect V200” which sets up a basic pool of purchasing power among the members, again from an electrical analogy, the spark to set the machine in motion. A monetary system is nothing more than an accounting machine with its cash tokens as the observable part of its functioning.

All members A or B get a checkbook. We encourage the use of the proposed cash V-Checks to be used (with B member ads on the reverse sides, so they would function as legitimate advertising), but each member also would get a checkbook. A check requisitioning V-Checks is made out to cash, the Valuns are moved from the member account to the V-Check account associated with specific V-Checks; like traveler's checks. No transaction fee is charged. If the V-Check is not cashed in or recovered, it can be traced back to the member that acquired it to determine what happened to it, etc.

Some V-Checks might be acquired by a member knowing they will expire in six months, but knowing also that they can get replacements for them in newer V-Checks at any time in the future, and may nevertheless stash them in a drawer and might forget them. Each exchange will have as its principal service the making good of any legitimate V-Check presented to them, either by deposit or replacement. Depositing V-Checks into another account, not your own, results in a transaction fee payable by the depositor. An expired V-Check can be exchanged for another updated V-Check without transaction fee; the records for the expired V-Check are removed from the system – the Valuns are now associated with the new V-Check and so on until the V-Check is deposited. A monetary system is all about accounting and the transactions among accounts. 

Q: What would you do if someone brought in cash in some other money to exchange for Valuns? 

A: Since all of that money belongs to someone else, we can't hold it on account; THEIR money is the “notes” or debt instruments of THEIR system. We would also not likely take too much of THEIR money at one time, probably each exchange would set a limit of transfers per month per member because it is THEIR money and THEY are always looking to tax it away and we don't want to get ourselves involved with any of that until it is obviously the only way for some people to survive with their wealth intact. These are the intended financial lifeboats, THEIRS is the Titanic and it is going down.

We would take THEIR money and immediately buy gold and or silver bullion with it (the only brand of THEIR money we can at this time hold) and that would go into the vaults of the exchange and be owned by the members of the exchange. In the case of all transfers of this kind, Valuns are exchanged for THEIR money and spring into existence. These are “backed” by the precious metals we buy, BUT there is no commodity association about it; each Valun takes the silver or gold to buy it that we say it takes, not THEM based on the present value of our initial transaction.

Remember, we take the present value of an inception transaction: the purchasing value of our money stays right where it started, while THEIRS moves below ours (Valuns always at premium to THEIRS, never at discount) to be determined as THEIR markets trade every day. Our yardstick of value measurement remains static while theirs are all inflating. Want stable prices? Stick with Valuns: prices stated in Valuns are far less likely to change due to anything but actual costs and supply and demand. For once in your life, you'll have better than gold; a fixed yardstick standard of value to measure everything else reliably without the usual causes of inflation.

Q: Since your transaction basis involves a piece of purchasing power, how did you choose it? 

A: Since our transaction involves gold, I chose a transaction at a time close to the recent top in prices for gold in US dollars on a date that would be easy to remember; 11/2/2011, we've just passed the fifth year in our experiment. That's a big piece of purchasing power as represented by today's value: we began at $2.16 and now the equivalent $2.69 (11/1/16), still 24% above inception. But Valuns are not intended to be some kind of “buy and hold” investment, like bitcoin for instance. The Valun is intended to be used as money; spent and earned in a working economy (co-money) and Valuns will die the same way in any economy, in depreciation.

Q: What happens when the price of gold exceeds your inception transaction? 

A: When that happens, a new inception date is accepted by IVES and all extant Valuns will rise as long as gold is actually attainable in US dollars. If any other of THEIR currencies survives the collapse of the US dollar, perhaps it will be used instead of US dollars; whatever is practical. When it isn't, we revert to whole barter and 1 oz of gold gets V1,000 and an oz of silver perhaps V20. By that time, as we would say, the lifeboats would have been mostly sunk or unavailable. Whatever happens, the Valun gets harder and heavier with each new inception and beats inflation in any of THEIR money.

Q: How does one earn Valuns? 

A: Anyone with a job can conceivably earn Valuns as they earn pay in their “public” money running parallel Labour Contracts (LC's) as described elsewhere on this blog. The limit would be based on income taxes in THEIR money at the end of any tax period, because like it or not, THEY want a piece of you no matter in what money you earn it. You accept the fact of THEIR ability to impose FORCE on you as THEY determine whatever the law is. That's being realistic. Law is FORCE, so you pay your taxes in THEIR money. You are paid based on these LC's that run for the same time you are being paid in THEIR money, a parallel system.

Q: How are Valuns issued? 

A: Three ways: 

1) We discussed the exchange for any of THEIR money. 

2) Probably 90% or more of the money will be issued and “backed” by work done by the members as carried out under LCs. 

3) The rest, for our indigent or homeless members will be what we described as “natural socialism.” Anyone living on a pension of any kind may be qualified to issue Valuns. These would be the only source of unbacked money in the system; Riegel called them the “red inkers.” 

We predict that since we would be PRIVATE and therefore the wealth that we would establish in Valuns would grow forth from us, trickle up economics, the numbers of people who would be allowed to issue Valuns this way would gradually diminish and eventually no one would be poor.

Q: How will you end war?

A: War cannot be ended until the means for making war becomes too expensive and that means that THEIR money system must crash and NOT be replaced but repudiated by the world at large, because we'll have ours and none of us want to spend our money for war. Where then would any source of money come from except from us and we would then be hesitant to proffer very much of our money for any government that promised us protection with too many strings. I said I stand for the Bill of Rights from the US Constitution and that includes the right to protect yourself, your will, your liberties, your property and your loved ones. War will end when it no longer pays.

Q: How will you end poverty? 

A: Perhaps having your own money is not enough to end poverty overnight, but eventually it will be the difference. The allowances for “natural socialism” each community exchange makes are amazingly low compared with what the biggest governments spend for THEIR military or education aparat for that matter. Besides which, as we explained, the poor must spend everything they have and anything excess in an economy tends to gravitate to the most productive. That's just what will happen in our system. A man with a job and a poor man sit side by side in a diner that takes Valuns and when V-Checks are proffered, each will pay what's required without regard to how rich or poor they are. Each will know that they issued the money they spent or acquired it in their own business. If you spend it, you are of course willing to take it back in return. That's how money works.

Q: Who or what are forbidden entry into your system? 

A: The so called “public” corporations and governments are at this time forbidden to join as members of our business. We pay our taxes from the proceeds of the gold and silver we acquire in trade for Valuns. Likewise the money we take in as membership dues goes into a regular (one of THEIRS) bank account and that account belongs to the members of each exchange. From that regular bank account (for the time being), whatever is required to set up a system based on laptops and thumb drives and at the center a larger computer to print the records etc. is obtained. Records of this account would be available for any member to see.

Q: How many people would it take to make the system profitable? 

A: We'll start with how each exchange makes its money; transaction fees. Riegel's suggestion will be the standard we begin with; one tenth of one percent of a transaction (V.001 of V1), for moving Valuns from one account to another. 

After some consideration, for V-Checks, you don't pay a transaction fee for acquiring them, but you would for depositing them into an account. If you bring in valid expired V-Checks and get updated V-Checks in exchange, there is no transaction fee. We want to encourage the use of V-Checks.

Exchange profitability in Valuns is all that counts, the expenses in “public” currencies, like US dollars, are in the dues accounting and the exchanges of THEIR money for ours stored as precious metals. All those are sources of income to the exchange as a business and must be accounted for taxes. At the end of each taxing period the exchange pays its taxes from a combination of dues and sale of precious metals. The intent is to keep the taxable income and assets of each exchange very low. Exchange offices and any extant Valun counters that emerge may decide to operate on “bankers' hours” which were from 9 AM to 3 PM. This would give office staff the extra time off hours to deal with the business of each day.

If it takes V .001 to move V1, 
then it takes V1 to move V1,000 and 
V10 to move V10,000 and 
V100 to move V100,000. 

That's about the cheapest price to move money through an accounting system that I know of. But we'll have to see if it provides enough to maintain an exchange. Riegel recommended this as a start and if necessary, we could raise the transaction fee structure. However that may be, we the members/OWNERS will decide based on actual records rather than by some arbitrary decision as is usually the case in THEIR system.

Now let's consider people. 1,000 members get V200 to start which makes V200,000 which at $2.69 (11/1/16) = $538,000 in purchasing power and it starts from there. Most communities will probably have little trouble enrolling 1,000 A members, but that's not enough for a very deep local economy. B member businesses have employees that are A members. That way they buy part of their present jobs with LCs and they issue Valuns before they get paid in them as described elsewhere in other papers on self financing of labour. In future people will decide who they prefer to work for and talent will seek its expression wherever the need arises.

The social result of such a monetary system would be to remove the excess pressure on the state that perhaps THEY (globalists, central bankers, elites) might have wished and return it to each one of us. We will self finance our own labour and in process begin to build our own economy (co-money) using our own money, the international standard Value Unit or Valun. 

Q: What do we need to begin?

A: A survey of your communities with the potential numbers of likely OWNERS and the number of businesses, especially any family owned businesses, which would be likely B member subscribers. Oh, one more thing: each A member pays a V1 dues per year and are OWNERS, but businesses pay nothing to join as long as some or all of their employees are also A members.

B members would be privileged to purchase advertising through each local exchange, payable in THEIR money for now, and their advertising designs would be featured on the reverse sides of our V-Checks.

The V-Check (return of the traveler's check) is specifically designed to be impossible and not worth counterfeiting, since there will be so many designs and they will presumably change with the seasons on a far more plausible production on demand, almost a “just in time” process that stays well within the diminishing efficiency to scale of print runs, so that we can keep our quality up and our costs down. The first runs would be of the V1/2, V1, V2, V5 and V10. The present comparable price points (11/7/16) would be would be at $1.36, $2.72, $5.44, $13.91 and $27.22. Of course since all members will also have individual checkbooks, these can be made out for any number of Valuns down to the smallest named subdivision of a Valun; each Valun is divided into 100 cends, cendos, fen, etc.; the smallest part.

These represent the latest overall description of the proposal to date.

David Burton

Current Hypothetical Value of a Hypothetical Value Unit

[11/8/16: Q: You mentioned something about ledgers, about the proposal having only one ledger? What are the advantages of this? How can you bring about coordination and settlement?

A: The proposed single ledger for the proposed monetary system is to be a fully running accounting engine, always in motion, so the best we will be able to do is to take snapshots at the last day of business by the month, quarter, half and yearly as is done in any other accounting system. We'd need to assess each exchange's earnings in transaction fees, for tax purposes anyway.

But each exchange has part of the entire ledger that would extend out all over the world to all exchanges. What this does is allow those who would do harm to be detected and thrown out of our system, after all, it will be PRIVATE so we get to decide who stays and who goes and for how long, probably not forever, but we do not want to sponsor any scams, get rich quick schemes, racketeering (not offering anything of value in a trade but taking money for it anyway – stealing), gambling, gaming, etc. A member who moves his A membership account a lot is suspicious. One can do it and the procedures for doing it will be worked out by IVES. The reasons for moving their A membership account may be perfectly legitimate, perhaps they just haven't found their place yet, but there may be other activities they are engaged in that would bring down the reputation of the Valun exchange network (VEN) community. There are intangible things that are of value. We identified these as goodwill. If any of our businesses loses goodwill they soon lose any tangible value they might have possessed as going concern businesses.]

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