Strange Currency

[Porty]

From today's EN:

http://www.scotsman.com/edinburgh-eveni ... _1_2007771

Been tried elsewhere- what do you think?

[seanie]

There are some well established local currencies in existence, but they tend to work best at a fairly large scale; at a regional level, or possibly city wide. You also need a fairly wide buy in to the scheme, otherwise it's a bit of a gimmick.

[seanie]

One problem, at the smaller scale, is that apart from the initial novelty value the people likely to be enthused by and actually use a local currency, are the people who actually shop locally anyway. So it doesn't necessarily affect spending patterns.

Secondly, the idea of an in-built discount will have some appeal (21 Porty Pounds for £20) but who subsidises that? Businesses might not be keen on the hassle of a separate currency anyway, but I can't imagine many wanting less than a 1:1 exchange rate. Especially if they don't perceive much increase in spending for the reason above. You'll have some savings through notes not being redeemed (again partly down to novelty value) but how do you sustain a 20:21 differential?

At a local level I think something like a Timebank would be more useful than a currency.

[Porty]

One problem, at the smaller scale, is that apart from the initial novelty value the people likely to be enthused by and actually use a local currency, are the people who actually shop locally anyway. So it doesn't necessarily affect spending patterns.

And if that were the case, it woud effectively be like a tax on porty shopkeepers. I doubt the total annual retail spend in the porty marketplace will be enough to sustain the porty pound. However, as a high street retailer, i'd be willing to subscribe to the scheme.

Not all that enthused by the prospect of Harry Lauder or Gail (nothing personal).

[Bob Jefferson]

Who would you have on your Porty fivers and tenners then?

[Porty]

Hmmm...good question..does it have to be a person/s?

[seanie]

And if that were the case, it woud effectively be like a tax on porty shopkeepers. I doubt the total annual retail spend in the porty marketplace will be enough to sustain the porty pound. However, as a high street retailer, i'd be willing to subscribe to the scheme.

Local currencies work when they're of sufficient scale that shopkeepers themselves can use them. If they can use them as change, to buy stock locally, or even part pay wages, then nobody is losing out. As long as the money keeps circulating. But that needs widespread buy in to the scheme.

On the smaller scale, the danger is that they aren't of use to shopkeepers who then seek to redeem them for sterling. If they're getting £20 for every #21 then they've taken a 5% hit on their takings. If they're taking £21 for every #21 then someone is subsidising the scheme because those #21 were originally worth £20.

Also, for HMRC, a local currency is no different for tax purposes.

[Bob Jefferson]

Generally speaking.

[rmolehusband]

I like the principle, but don't see the point of just being able to buy them - that makes it little more than a discount voucher scheme. Even at that, I don't think I would go to the bother of exchanging my sterling into porty pounds just for a 5% discount. I'd suggest you need to 'earn' them, which maybe ties up a bit with Seannie's time bank idea.

However, to me, the best way to earn them would be as a reward for shopping local - each participating retailer would give you some porty pounds when you shop with them. These same retailers would accept the porty pounds as payment. It could be tuned work out at the same 5% discount, though the denomination or exchange rate would need to be tweaked so that you could collect something on small value purchases.

Retailers would be more inclined to get involved as it would promote repeat local shopping. Since they will both give out and receive, those who receive a surplus would sell to those with a deficit, thus ensuring that the cost to a retailer is always in proportion to the amount of real money spent in their shop.

[rmolehusband]

Who would you have on your Porty fivers and tenners then?

Diana Cairn's backside, as she sits on pretty much everything else in Porty already.

[seanie]

You can have a 5% discount to incentivise the introduction of a local currency, but that's not the point of the exercise and it would be a mistake to promote it on that basis. The main advantages are that it keeps liquidity in the system and reduces the leakage of money from the local economy. There's also nothing difficult in principle about operating them. The difficulty is a practical one of having enough people participating, over a wide enough area, for the currency to be genuinely useful.

[Bob Jefferson]

Who would you have on your Porty fivers and tenners then?

Diana Cairn's backside, as she sits on pretty much everything else in Porty already.

I'm sorry but I'm not having that. If anyone's derriere is going on it, it has to be Gail Porter's from 1999. Just to be absolutely sure though, I will do some Google image searching this evening.

[seanie]

To raise the profile of the PCC we could introduce a new award?

PCC Cllr of the Year?

Celebrated by a tasteful nude shot projected onto the Police Station?

I'll throw my hat into the ring.

[Bob Jefferson]

PCC Rear of the Year. That's an idea we could all get behind.

[Porty]

Not a new idea, we used to have "rear of the year" back in the 70's. There was a parade every year outside the baths. Eventually it died out due to disillusionment amongst potential contestants. Four or five years of the beach donkeys dominating the final proved fatal.

[rmolehusband]

You can have a 5% discount to incentivise the introduction of a local currency, but that's not the point of the exercise and it would be a mistake to promote it on that basis. The main advantages are that it keeps liquidity in the system and reduces the leakage of money from the local economy.

That's interesting, I hadn't really thought about it in that way.

My next question would be what it might offer someone (like me) who maybe doesn't have much or any spare time to do work or earn within the community? I chose to spend with local traders as much as possible, but that money all comes from outside Porty. Is it not going to be only of interest to those who are selling or providing a service, i.e. earning some income, within the community?

[Mark Cameron]

To raise the profile of the PCC we could introduce a new award?

PCC Cllr of the Year?

Celebrated by a tasteful nude shot projected onto the Police Station?

I'll throw my hat into the ring.

Better watch what you wish for Sean what with all this talk of rears and rings

On a serious note thought I've been trying to find some information I read a couple of years ago that talked about a community local pound where a percentage of each pound spent went into a community improvement fund. Try as I might I can't find it though

[seanie]

The benefits of a local currency tend to be felt at more general level rather that that of an individual. For an individual it shouldn't really be much different from using normal currency. The advantages are mainly that (because you can't put it in the bank) it tends to keep circulating, and because it's tied to a geographical area it's less likely to leak from the local economy. It's not really an injection of funds into the economy, and it might not alter spending patterns dramatically, but the idea is that over the longer term, if it achieves a critical mass of acceptance and exchange, it makes the local economy a wee bit more resilient and a wee bit stronger. It's not something likely to work at a Portobello level, but if you had an Edinburgh Pound or a Lothian Pound that people really used it could be beneficial.

[rathbone]

On a serious note thought I've been trying to find some information I read a couple of years ago that talked about a community local pound where a percentage of each pound spent went into a community improvement fund. Try as I might I can't find it though

You're probably thinking about the Lewes Pound, where the money goes into a fund for community causes. It's been running successfully since 2008. More info here:www.thelewespound.org/assets/files/Lewe ... _Guide.pdf

[rmolehusband]

Story on the BBC of a local currency scheme in Brizzle.