Making currency work

[olaf]

I hope this hasn't been discussed ad nauseum in the past few months - I've been largely absent from the forums... Anyway, here goes:

I'm not a historian, but I get the impression that when currency was initially introduced, at least in Western cultures, that it was gold and silver, which actually had the value (i.e. desireability/worth in the eyes of those using it) it represented, because at the least it could be melted down to make pretty things. And that it is only a comparitively recent idea that as confidence increased in what a currency represents, that the coins could be reduced in actual value, and even paper/plastic notes could be used.

Right?

One of my characters is being currently slagged by another character who is all set on having an island-wide currency. My character has (and I have) nothing against this in principle, but cannot for the life of him (or me) figure out how this character can expect people on the other side of the island to have confidence that "one coin is worth a day's labour". My character tells him that something is worth only what somebody perceives it to have, and that, although he will try to promote it, he thinks (and I think) that it will be a slow process.

Anyway, why I bring this up, is that I am aware of many efforts to promote currency, either in a single town (which seems somewhat achievable) or on a larger scale (which seems to me to be dreaming).

Yet... Although I'd love to see them succeed, I honestly can not figure out a way for the intermediate stages to be worth anybody's while!

To put it a different way - sure, it will be great when everybody recognises the value island-wide, and doesn't have to carry heavy resources around, etc, etc, etc, but what about the initial stages...?

The only way I can see is for it to become more and more established in a single town, and then just maybe it might spread... But I doubt it.

Has anybody yet had any thoughts as to how this might actually happen?

[Mykey]

Absolutely with you it agree. I like this idea, I completely with you agree.

[N-Aldwitch]

We really just want money to work for OOC satisfaction.. really, right?

[SCUBA]

In parts of the swedish island we have stollar as currancy. stollar is based not on labor but on meals you eat. 10 stollar is one meal. So the currancy is food. But it is limited to prepared food. If you are rich and dont need all your money you just eat it. So there is always an desire for the money. We tried to introduce coins as compliment, but they were not popular and we have a market there most of the trade is made. Most of the time you just leave your things on the market and later comes back and pick up the money or more common other resourses you like to have that others have put on the market. So most of the money is only on the markets notes that always are public so everyone can see what everyone have on the market both in resourses and stollar. The stollar is now in use in some private trade also and a second privat market in another town is going up.

[Talapus]

People always know the exact weight of a pile of resources, so coins are useless in the traditional sense. And as long as coins can be returned to resources, they will continue to have weight. What people have seemingly forgotten, is that there is yet another type of curriency besides the fiat curriency. It is one that actually fits Cantr fairly well. That being a curriency that has little or no physical value, but has real worth because it is backed by a government (think US silver and gold notes). So a town could declare that a copper coin marked with the town's sigil is worth 100 grams of iron, and any person can trade in such coins and immediatly recieve the iron that they represent. As long as the government is strong, the curriency will have real value in that town, and diminsishing value the further you get away from the "bank" (the place where you can exchange resources). However, as the curriency stands, it will gain in worth further from the main town (as people see that it holds real value, and can use it to trade). Also more branches could be opened to expand the reach of such coins. This is the type of curriency that I actually expect to see develop in Cantr, as I believe it is the most viable choice.

[Mykey]

I confirm. So happens. Let's discuss this question. Here or in PM.

[tiddy ogg]

I thought this subject had been done to death in previous threads. As someone said above, unless the currency has its own intrinsic value, (eg 10g iron) it won't be accepted without trust. How many Cantrian governments last more than 20 Cantrian years? Thus no trust.
If a 10g iron coin is worth 10g iron, what's the point of processing the iron expensively to produce it in the first place.

[Mykey]

Logically

[formerly known as hf]

Check out Sociologists 'essays on motivation' and the Economy in Cantr - a follow-up on Jos Elkink's article - this is a subject that has been beatn many a time.


For the sake of repitition... I will say what I always say.
As long as exact weights are known, and values of 'time taken' to generate a resource or item, there will be no need, and no use for, currency in Cantr.

[deadboy]

People always know the exact weight of a pile of resources, so coins are useless in the traditional sense. And as long as coins can be returned to resources, they will continue to have weight. What people have seemingly forgotten, is that there is yet another type of curriency besides the fiat curriency. It is one that actually fits Cantr fairly well. That being a curriency that has little or no physical value, but has real worth because it is backed by a government (think US silver and gold notes). So a town could declare that a copper coin marked with the town's sigil is worth 100 grams of iron, and any person can trade in such coins and immediatly recieve the iron that they represent. As long as the government is strong, the curriency will have real value in that town, and diminsishing value the further you get away from the "bank" (the place where you can exchange resources). However, as the curriency stands, it will gain in worth further from the main town (as people see that it holds real value, and can use it to trade). Also more branches could be opened to expand the reach of such coins. This is the type of curriency that I actually expect to see develop in Cantr, as I believe it is the most viable choice.

Wow, you have some seriously distorted ideas, first the US has no gold notes or silver ones, those ...

Fiat Currency

Actually no Mykey, you are wrong. 95% of gold is currenly sitting in banks just for this purpose, to back currencies. No there is not the gold coin anymore, but the currency is backed by the price of the gold sitting in thier reserves

[Mykey]

You are mistaken. I can prove it. Write to me in PM, we will discuss.

[Mykey]

I think, you will come to the correct decision.

[Mykey]

In my opinion it is very interesting theme. Give with you we will communicate in PM.

[Talapus]

I was only mentioning gold and silver notes in a historical context. I know that the US dollar isn't linked to gold any longer, but the historical case stands as a proof of concept.

[Mykey]

Very good information