Tuesday, January 8, 2013

Bob Owens throws his two cents ( or would that be trillion cents?) into the debate about minting a trillion dollar coin to solve the debt limit problem.

This insanity, which apparently is being promoted by serious economists, allows one to judge just exactly how far our government has travelled away from simple common sense.  Not only is it at best a gimmick to allow the government to get around the law on how it spends money, but it is highly dangerous due to the fact that the whole process highlights the lack of any real basis for the value of the  country's currency.

If this doesn't work, then what next?  A quadrillion dollar coin?   Why a coin at all?  Just write the number of the dollars you want to spend on a piece of scrap, and call it good.

Meanwhile, the common people who see what is happening adjust, and organically create their own local currency.

In this bustling port city at the foot of Mount Pelion, in the heart of Greece's most fertile plain, locals have come up with a novel way of dealing with austerity – adopting their own alternative currency, known as the Tem. As the country struggles with its worst crisis in modern times, with Greeks losing up to 40% of their disposable income as a result of policies imposed in exchange for international aid, the system has been a huge success. Organisers say some 1,300 people have signed up to the informal bartering network.
For users such as Ioanitou, the currency – a form of community banking monitored exclusively online – is not only an effective antidote to wage cuts and soaring taxes but the "best kind of shopping therapy". "One Tem is the equivalent of one euro. My oil and soap came to 70 Tem and with that I bought oranges, pies, napkins, cleaning products and Christmas decorations," said the mother-of-five. "I've got 30 Tem left over. For women, who are worst affected by unemployment, and don't have kafeneia [coffeehouses] to go to like men, it's like belonging to a hugely supportive association."
Greece's deepening economic crisis has brought new users. With ever more families plunging into poverty and despair, shops, cafes, factories and businesses have also resorted to the system under which goods and services – everything from yoga sessions to healthcare, babysitting to computer support – are traded in lieu of credits.
"For many it plays a double role of supplementing lost income and creating a protective web at this particularly difficult moment in their lives," says Yiannis Grigoriou, a UK-educated sociologist among the network's founders. "The older generation in this country can still remember when bartering was commonplace. In villages you'd exchange milk and goat's cheese for meat and flour."
Other grassroots initiatives have appeared across Greece. Increasingly bereft of social support, or a welfare state able to meet the needs of a growing number of destitute and hungry, locals have set up similar trading networks in the suburbs of Athens, the island of Corfu, the town of Patras and northern Katerini.

Meanwhile, has anyone over here heard of or used bit coin?    Might be something that will have more real purchasing power in the end than a trillion dollar platinum coin.  Or a scrap of paper that purports to be backed by the "full faith and credit" of the U.S. government.

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