Parallel economies and their currencies:
Many parallel economies (with their currencies) have flourished in the past and still exist today. Their principles and benefits – often overlooked by economists – are worth learning through historical and modern examples. In continuation, could an innovative parallel economy fit in our society?
to reduce inequalities... and contain global warming:
As the middle class is hurting, especially in rural America, could a parallel economy help the underprivileged and win over everyone?
Could the last chapter's Green-Market System work? To be successful, such a System must create jobs with good wages... and convincingly cut down CO2 emissions. Would this System be too good to be true?
The economy matters. A strong economy will generate goods and services to be redistributed (hopefully fairly) according to the wages of the people. On the contrary, no output means not much to redistribute, even not much to tax and pay for infrastructure, healthcare, defense, and other governmental projects.
What drives economic output? Well, the most successful system has been capitalism, despite its flaws. It should mix free-enterprise, fair regulations, and funding of new ideas. And, it is wise to understand it before criticizing it.
To explain capitalism, the best illustration happened in the 18th century, when the British economy dramatically increased its output, and unexpectedly sparked a revolution of a new kind: the Industrial Revolution. Moreover, it is important to understand the financing of the Industrial Revolution in order to understand how to fund a Green Revolution.
This Industrial Revolution was made possible by new monetary tools that avoid deflation (which is explained in free half book on findtheflaw.com/free).
Indeed, the monetary system predating the Industrial Revolution, i.e., until the late 17th century, was often tied up with deflation linked to the lack of currency:
• Gold and silver coins, with 1 ounce of gold worth around 15 ounces of silver. It was hardly possible to multiply coins by debasing their precious content, which people could verify with touchstones and other techniques in use since the middle ages; people were quick to reject debased coins or to move their trade to a neighboring country with better coins.
• Token coins, or small denomination copper coinage. Token coins were fractional equivalent of gold or silver coins. Token coins were accepted as payment because they were convertible on demand into gold or silver. Due to the slow circulation of token coins prior to any conversion into gold or silver, it was pure profit in gold or silver for the token coin issuer, which was often the Mint or sometimes private institutions. Token coins had to be issued in limited quantities to guarantee conversions into gold or silver at the issuer.
• Bills of exchange. They were certified checks for merchants. Merchants could safely deposit their coins in a bank and use such bills of exchange as means of payment in place of their coins. After payment, merchants could even endorse the received bills of exchange for further payments. In the meantime, as the merchants were not withdrawing their coins for some time, banks could loan the coins left in deposit during the same time, and cash in juicy interest. However, the use of these bills of exchange was limited to trusted acquaintances within the circle of merchants and bankers.