nuance intelligence

When The Wall St. Journal Online covers the growing complementary currency movement in the same week that The Economist talks about triple-bottom-line values encroaching on traditional investing, it appears that maybe, just maybe, the consciousness around money is finally changing.

In the most recent installment, WSJ’s video report covers a wide range of popular currency initiatives, including reputation- and attention-based incentives.  Our long-time partners at the Metacurrency Project and The New Currency Frontier blog were featured in the piece, even though their ground-breaking work does not suit a 101 crowd.

As we wrote in an in-depth review of online and social network currencies this summer, there is a fair bit of refinement needed in many of the systems. Continue reading

Two weeks ago, we reported from the front line of the of sustainable business investing world, reviewing how trends in local, slow, and open money were converging with angel- and VC- fueled tech innovation, and how those two communities are not as far apart as each camp might think.

Similarly, concepts around virtual, complementary and community currencies that were once reserved for the then-fringy universe including BALLE and LOHAS, as well as the then-fringy world of hardcore online gamers, are now (finally) being discussed within the world of the disturbingly mainstream Facebook.

Geekdom has reacted somewhat cautiously to the widely leaked rumor and related sightings of  Facebook’s toe dip into the complex world of virtual currencies, which is revealed in the connection between Facebook’s credits and internal transactions. Continue reading

Wow.  There have been many “I never thought I would read about that” moments this year, but to read an article on the BBC about the concept that banks could offer negative interest makes me wonder if the apocalypse really is upon us.  Also called demurrage, negative interest is a carrying charge, and one that people might pay if they think their money is really at risk.

From the BBC:

Justin Urquhart Stewart, director of Seven Investment Management, says rates have been negative before.

“It does sound very strange, but it has happened in the past.

“If you go back more than 20 years to Switzerland, people were so worried about the value of currencies that they were running to anything they saw as a safe currency and the Swiss franc was it.

“So overseas investors had to pay for the privilege of holding Swiss francs – a negative interest rate.”

But that’s just the beginning.  Another effect of demurrage is that it encourages spending, because your money will be worth less tomorrow than it is today.  Of course, you ought to be spending money on something that will be of greater value tomorrow than it is today.

What’s the nuance?

In the BBC piece, the “rational” economists and bankers say that it won’t happen, despite the examples to the contrary, but the very fact that the article was not laughed out of the newsroom points to an incredible shift in what’s possible.

As we wrote just last month, innovative money, currency and exchange systems are getting more and more attention these days.   Innovative money systems are not so distant anymore.

Who reads TIME and Newsweek anymore?  Not many people I know — except my mom, who brought about three issues of the latter with her for Thanksgiving.  During the perceived junk-out — err, semi-annual research into mainstream media coverage trends — I was pretty surprised to find an article about complementary currencies titled “Small Town Currencies,” in the Crisis Watch section.

Dozens of such systems arose during the Great Depression. In the 1990s, they resurfaced as a way to fight globalization and keep wealth in local hands. Now the idea of homespun cash is back because it keeps people liquid even if they are short on traditional dollars.

The rest of the two-paragraph front-of-the-book micro-mention missed many of the core values and benefits that drive the currency movement, which is to be expected.  Imagine m surprise when I read The Transitioner’s tweet that TIME magazine had covered much the same story.

“Alternative Currencies Grow In Popularity” is a better piece of journalism, covering the history and background of the movement, and highlighting the activities of some of the more well-known systems.

Alternative means of trade often surface during tough economic times. “When money gets dried up and there are still needs to be met in society, people come up with creative ways to meet those needs,” says Peter North, a senior lecturer in geography at the University of Liverpool, author of two books on the subject. He refers to the “scrips” issued in the U.S. and Europe during the Great Depression that kept money flowing, and the massive barter exchanges involving millions of people that emerged amidst runaway inflation in Argentina in 2000.

The article does a good job of explaining the 101 of currencies, tax implications and highlights many leaders in the space, including our friends and co-conspirators Jean-Francois Noubel and Bernard Lietaer, two European thought leaders on the issue.

In recent years, the impetus for alternative currencies in established economies has stemmed in part from localization movements. Periodically ditching the dollar (or the pound, or the yen) in favor of homegrown currency doesn’t merely fortify the local economy, it also builds community: people have a stake in their neighbor’s well-being because that neighbor represents both market and supply chain. Some argue that such transactions are more secure than others because knowing the person you’re dealing with (and his family and friends) serves as a kind of social collateral.

It seems that the author has actually begun to understand the deeper impact of currency, which is where we think the general appreciation has lagged.

What’s the nuance?

Continue reading