EDITOR’S NOTE ON THE VELOCITY OF MONEY: One of the challenges created when a national currency rises to the level of global acceptance as a transfer currency valued above other currencies is that the scarcity of those dollars which exists in the nation of origin becomes more pronounced. Those dollars become more valuable as an investment rather than medium for facilitating trade.
This decreases the velocity of money which is the rate at which dollars change hands between members in a society which is a true precursor to the expansion of prosperity and economic participation.
Local currencies such as timebanking afford communities greater flexibility than national currencies to direct economic vitality as those priorities which are most important to that community where national currencies service a multitude of other priorities which remove it quickly from circulation in local institutions.
“The core reason for the uptake of local currencies is their promise to serve the real needs of local people in ways that national monetary and financial systems do not. They represent a possible path to a future that is more socially, financially, and environmentally sustainable.
Current monetary systems fail because they burden the public with debt and don’t put new money into circulation when and where it is most needed. Financial and corporate systems fail because the intense drive for investor and corporate profit is poorly aligned with what matters most to the average human: wellbeing.
People at all levels of society are urgently looking for solutions, and local currency systems could offer hope. So what are the benefits and how do such systems work?
Local currencies are tools to assist communities in making full use of their human, industrial and commercial resources. Some programmes resemble “buy local” campaigns, which encourage shoppers to purchase products at local shops, which boosts high street activity. But the potential benefits are greater than this.” – John Boik
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