We’ve all heard enough tired analogies about money to fill a bank vault, but what happens when a recession, a lagging dollar, and general social malaise all conspire together? By all appearances, the United States Mint doesn’t appear to have all the answers anymore. And so in a striking chain of events, conventional currency is being replaced by a local alternative, one community at a time.
Considering the times we live in, it shouldn’t be that surprising. Most recently, a portfolio manager at Pacific Investment Management, who currently run the world’s biggest bond fund, announced on the company web site that the US dollar is losing its status as a global reserve currency, particularly against emerging markets. While analysts are suggesting that investors cut their holdings of US currency, Argentinians have been mired in a change shortage that has made paying bus fare something of a luxury. So could alternative local currencies be the answer?
By the looks of it, alternative currencies have already become a viable option. A network of roughly 80 businesses in the Greensboro, NC area have been operating under the Velocity Trade Exchange since 2007. The bartering system is associated with the National Association of Trade Exchanges and establishes a local system of credit based on the exchange of goods and services. A new community system of exchange, Velocity is just one of dozens of NATE-affiliated exchanges in every American state and Canada. But despite NATE’s sprawling membership network, perhaps just as many grass-roots alternative exchanges have been sprouting up all over the country.
A group of Phoenix businesses have started accepting Phx Bux, a new local currency that won the praises of local businesses by ensuring that residents keep their business transactions in the area. Similar independent alternative currencies have invigorated communities in Madison, WI, where they have begun issuing Madison Hours to promote economic strength and community self-reliance, as well as Michigan, who have dealt with their own economic hardships through the issuing of Bay Bucks.
But perhaps no state has adopted alternative currencies at a greater rate than New York. In the Berkshires region, they’ve been steadily adopting the new BerkShares currency, actual printed notes designed by local artists. Since 1991, dozens of Ithaca businesses have been accepting Ithaca Hours, notes that proudly read “In Ithaca We Trust.” And most recently in North Brooklyn, a group of artists have established the Brooklyn Torch Project, a system inspired by the Statue of Liberty’s iconic torch that is looking to establish its own alternative local currency. It’s a unique method to beat the recession while solidifying community ties, and with a name like Ithaca Hours, we’ll never forget that time is indeed money.