Prof. Dr. Margrit Kennedy
Using New Concepts WE
Can Rule Money?
Split 10.07.2012
124 banking crises326 currency crises
64 debt crises
According to an IMF – Statistik 2011
between 1970 und 2007 we have had
Misconception 1:Money with intereest and compound interest can grow forever
There exist different growth patterns in the material realm
a. natural growth alone can be termed sustainable
b. linear growth can be sustained temporarily
c. exponentielles growth is soon coming to an end
2. The Transparency Misconception
1 Garbage Collection FeesCost of interest on capital 12%
2 Drinking Water Costs Cost of interest on capital 38%
3 Rent in Public HousingCost of interest on capital 77%
Source: H Creutz
Interest is paid only when we borrow money
Interest payments and Interest gains show large disparities:
80% of the population pays twice as much as they gain
10% gain more than twice as much as they pay
Misconception 3:Everybody is treated
equally in the system
Source: H Creutz
Continual InflationBecause of inflation, in the year 2001, every DM
was worth only 20 Pfennigs…
and this was the most stable currency in the world!
Source: H Creutz
Excessive Increasein Foreign Exchange
Transactions
Source: Lietaer Of Human Wealth 2008
Exponentially growingDebtAND Assets
French government debt as % of GDP:
Official debt versus debt computed without interest 1979-2009
1979 government debt was € 239 billion or 21 per cent of its GDP2009, this had risen to € 1,088 billion or78 per cent of its GDP.
Had Article 25 of the Law of 3 January 1973 not been in force, the French government would have saved €1,306 billion in interest by 2009, and the country’s total public debt would only be 8.6 per cent of its GDP.
Components in Interest for Loans and Credit
In the present money system
Bank Fees 1.7%Risk Premium 0.8%Liquidity Premium 4.0%Inflationary Adjustment 1.5%
Total 8.0%
In complementary money systems
Bank Fees 1.7%Risk Premium 0.8%Liquidity Premium 0.0%Inflationary Adjustment 1.5%
Total 4.0%
• interest costs of 40% € 12.000 / household /year• demurrage half of that € 6.000 / household /year
Comparison of Credit Costsfor average German household with
€ 30.000 /year
DesigningComplementary Currencies
Creating new financial liquidity for a limited purpose
LOCAL, REGIONAL andGLOBAL CURRENCIES
or SECTORAL CURRENCIES
Sectoral CURRENCIES
two examplesFureai-Kippu System, Japan
WIR Wirtschaftsring, Switzerland
Fureai-Kippu = Care Tickets
since 1995 in Japan supports care of elderly
with help from younger people who get hour credits
which can be used at a later date in another part of the country
or by another person
WIR-WIRTSCHAFTSRINGPARALLEL CURRENCY SYSTEM
among small and medium businesses
since 1934 in Switzerland 15 Swiss regional WIR- organisations
60.000 membersaverage turnover per year 1.6 bio WIR
proves to have anti-cyclical effectsupports policies of government
REGIONAL CURRENCIES:• partial decoupling from globalized economy
• increased use of regional products and services• added value and surpluses remain in the region
• community keeps essential public utilities• closer links between consumer and producer• strengthening regional identity & diversity
• reducing need for transport and energy
A First Model for Regional Currencies:The Wörgl Experiment
Results in 13,5 monthsbetween 1932 - 1933:1. Unemployment reduced
by 25% 2. Town-Income increased
by 35%3. Public works investment
rose by 220%
Regional money system based on vouchersFigures for 2011:
Annual turnover 6 mio Euros
2.388 Members
600 Firms
200 Associations
Donations50.000 ChiemgauerTotal since 2003210.000 Chiemgauer
These
five villages
are supporting
members
paying
their fees
A Solution to the financial crisis in Greece and other European countries
developed by the initiators of the Chiemgauer
http://www.eurorettung.org/
Express Money is unique in two ways:
1) Via its spending incentive - demurrage -
monetary circulation is accelerated stimulating the economy.
Doubling monetary velocity doubles GNP.
2) Via the leakage inhibitor feature
an exchange fee for conversion into euro money stays in the country strengthening its economy
and reducing its trade deficit
• more favorable interest rate than euro credits, thus facilitating
economic investment.
• quickly become the vehicle for domestic payment transactions.
Differences between COMPLEMENTARY and TRADITIONAL currencies 1:
use- instead of profit-orientedlimited instead of general acceptance
circulation incentive instead of interest transparent instead of obscure creation
democratic instead of central control
Differences between COMPLEMENTARY and TRADITIONAL currencies 2:
inflation-resistant
instead of inflation-prone
promoting community instead of destroying it
Differences between COMPLEMENTARY
and TRADITIONAL currencies 3:
a win-win solution for everybody
instead of only ten percent of the population
Resilience Efficiency(Diversity + Interconnections) (Streamlined)
Sustainability of complex living systems
Optimum
0 %
100%
Window of Vitality
Resilience Efficiency(Diversity + Interconnections) (Streamlined)
Sustainability of complex living systems
Optimum
0 %
100%
PresentFinancial System
Resilience Efficiency(Diversity + interconnections) (Streamlined)
Sustainability of complex living systems
Optimum
0 %
100%
Effects of Complementary
Currencies
My change of perspective between 1987 und 2012
New Society PublishersGabriola Island, CanadaAugust 2012
more on:www.margritkennedy.dewww.monneta.orgwww.kennedy-library.info
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