Despite the various headers & quips, and despite the length
of this piece (from Bob Hettinga's lists) I thought it might be fun
to imagine selling e-gold in Argentina. As with India, I think the
first guy to do it right in that country is going to get wealthy. My
apologies for the length of this message, but *please* refrain
from trying to quote the entire thing if you choose to reply.
Note the story from 1985(!) reprinted below, where two remote
Argentine provinces ended up printing up their own money, so
the idea of a privately-issued currency isn't new in that country.
Also, I have _NO_ idea why, but apparently this topic came up
originally on an email list named "MedPot-discuss"! :^)
JMR
+++++++++++++++++++++++++++++++
Subject: [Fwd: [MedPot-discuss] TURMEL: Argentina resorts to UNILETS
"bond-currency"]
From: "R. A. Hettinga" <[EMAIL PROTECTED]>
Date: Thu, 23 Aug 2001 21:02:14 -0400
Probably should be re-"slanted", I bet. :-).
Cheers,
RAH
Who, as Birch might recall, *still* thinks of such "LETS" schemes as "labor
theory of value happy horseshit". :-).
--- begin forwarded text
Date: Fri, 24 Aug 2001 11:37:07 +1200
From: Blair Anderson <[EMAIL PROTECTED]>
Reply-To: [EMAIL PROTECTED]
Organization: Techno Junk and Grey Matter
To: "R. A. Hettinga" <[EMAIL PROTECTED]>
Subject: [Fwd: [MedPot-discuss] TURMEL: Argentina resorts to UNILETS
"bond-currency"]
fyi
cheers, blair
-------- Original Message --------
From: [EMAIL PROTECTED]
Subject: [MedPot-discuss] TURMEL: Argentina resorts to UNILETS
"bond-currency"
To: [EMAIL PROTECTED]
JCT: This article is from Bloomberg, a financial newspaper, so I
expected it to be slanted. I unslanted it by moving paragraphs
12,14,15 up to the front to expose the smear for what it is. (My
numbered comments later)
Ottawa Citizen Wednesday Aug. 22 2001
NEW CURRENCY SPAWNS ANXIETY (1)
by David Plumb
Bloomberg News, with files from Eliana Raszewski and Charles Penty
Picture Caption: Buenos Aires Gov. Carlos Ruckauf shows patacons, a
new half-currency, half-bond and the planned savior of for Argentina's
$153 billion debt. Economists say the bills undermine the peso's one-
to-one exchange with the dollar. "Argentina is bankrupt" Mr. Ruckauf
said.
Argentines in Buenos Aires province fear patacons are worthless, David
Plumb reports (2)
Buenos Aires
P1. The cash machine at Banco de la Provincia Buenos Aires spit out
part of Carlos Rodriguez's $1,400 U.S. monthly wage in crisp, 20-
patacon notes.
P12. The provincial governor in Buenos Aires, Carlos Ruckauf, asked
companies to accept patacons as currency alongside the peso, and said
they could be used as payment for federal or municipal taxes.(3)
P14. Water utilities Azurix SA, and Augas Argentinas SA, phone
companies Telefonica SA and Telecom Agentia, Stet-France Telecom SA
and railroad Metrovias SA have all agreed to accept the patacon.
McDonals Corp. said it expects to take the currency in exchange for a
new meal it plans, the Patacombo. Some banks said they would accept
the notes as payment on personal and home loans.(4)
P15. Osvaldo Rial, president of the Buenos Aires Province Industrial
Union, offered "total support" for the new currency while Alto Palermo
SA, which runs seven shopping malls, is negotiating with stores to
accept the notes. Argentina's world champion soccer team, Boca
Juniors, will let fans pay for tickets with Patacons, treasurer
Orlando Salvestrini said. "For many months, people are not going to
have another currency," Mr. Ruckauf yesterday in a televised news
conference. "Argentina is bankrupt."
P2. "I don't know if my salary has been devalued or not," said the 43-
year-old Mr. Rodriguez, one of 160,000 employees and retirees in the
province of Buenos Aires getting paid in the new currency. "It depends
on how I'll be able to use these patacons."(5)
P3. As the patacon - a one-year security with 7% interest - went into
circulation yesterday, residents weren't sure what it is worth.
Economists said the bills undermine the peso's one-to-one exchange
rate with the dollar, the economy's anchor for a decade.(6)
P4. The Buenos Aires province, Argentina's largest with 14.4 million
people, more than a third of the nation's population, printed $95
million of the new notes after banks limited access to loans.
Provincial employees began withdrawing in patacons the portion of
their July salary above 740 pesos - three weeks after the payment was
due.
P5. Other provinces, strapped for cash, plan to follow Buenos Aires'
lead.(7)
P6. "When the pile of worthless paper the provinces are printing
avalanches, the federal government will not be politically able to
stand by and just watch the Argentine people suffer the consequences,"
said Colin Negrych, manager of the Centaur Fund, a hedge fund in New
York.(8)
P7. The new money, which looks like an oversized peso bill, arrived as
Argentine officials entered a 12th day of negotiations with the
International Monetary Fund for as much as $9 billion in new loans to
help the country avert a default. In all, the federal and provincial
governments have $153 billion in combined debt.
P8. Brazil's GloboNews network reported Argentina may announce an
agreement for new IMF loans as early as tonight.
P9. The benchmark bond, due 2005, fell 2.25 to an offer price of
67.063 to yield 32.5 percent on growing concerns a default is
imminent. The bond was yielding about 17.5 percent in early July.(9)
P10. "Already some residents fear the patacon has no value."(10) The
province plans to print a total of $400 million worth by year end in
bills as small as one patacon - which has a face value of one peso and
pays seven percent interest at maturity.
P11. Eventually, the federal government plans to issue a new note that
would replace the patacon and other provincial currencies alongside
the peso, giving them nationwide circulation.(11)
P13. At the Alto Avellaneda shopping mall, Hugo Noblega doesn't trust
the plan. "We don't know what to do with them," said Mr. Noblega,
sales manager at a branch of Kartum, a cosmetic retailer. "My worry is
- what happens if we take them and then someone comes along and
changes the rules?"
JCT: So that's David Plumb's hatchet job on Argentina's new local
currency. He chose to highlight the opinions of idiots who worry about
what they spend their money on despite finding out "almost everything
in town."
Of course, in the article, only at the end do we find out that
almost everything in town can be bought with the new money. Had he put
that at the start of the article like I did, David wouldn't have been
able to keep citing all these people asking "what's it worth?" when
they sound like idiots once you've heard what it's worth. A "1-Pero
Bond" is worth a "1-Peso Bill." All those repeated anxieties and
doubts about Patacons being worthless and then we're told the doubts
themselves are groundless. The admission of the truth at the end
destroyed the whole previous inferences of worthlessness. It makes the
whole piece look like a tissue of lies.
Of course, when the alternative is using no federal currency or
using some local currency, regardless of whether businesses want to
accept the currency or not, if they refuse to accept the only currency
that everyone has and insist on selling for only currency that nobody
has, then they won't stay open long enough to oppose it for long.
After all, like the governor says, it's the only currency they're
going to have, everyone's going to be using it. And like I say, what
idiots would say such negotiable paper has no value and where did
David Plumb find them? My comments will follow, but first, my
contribution to this debate:
1982 ARREST AT IMF-WORLD BANK TORONTO MEETING
As the world's first anti-globalisation protester, when I was
arrested picketing the IMF/World-Bank meeting in Toronto in 1982, it
brought attention the pamphlet I was passing out.
http://www.cyberclass.net/turmel/imf82.htm
Quebec Social Credit first argued for a national LETS currency.
But Canada Social Credit didn't agree and threw me out and changed
their policy from prohibition of interest rates to 6%. So I founded
the Christian Credit thinking that credit could only be christian and
friendly if there was no interest.
This is the way I explained then what are the Abolitionist Party
programs of today: http://www.cyberclass.net/turmel/abprogs.htm
I reproduce the bit about bond-currency here:
THE CHRISTIAN CREDIT PROGRAMS:
1) The abolition of interest rates;
2) The establishment of a government dividend;
3) The establishment of no-premium fire and auto insurance.
1) The abolition of interest rates:
Consider how governments presently finance their activities:
If the city has expended the money allocated for snow removal and
is hit with a major snow-storm, Council calls an emergency session and
authorizes the issuance of $1,000,000 in municipal bonds. The mayor
has them printed up and exchanges the $1,000,000 in bonds with a
banker for $1,000,000 in dollar bills bearing 20% interest which
happen to weigh 100 pounds in all.
Council pays for the $1,000,000 job of snow removal with the 100
pounds of bills. The merchants and their employees accept the 100 pounds
($1,000,000) of bills in exchange for their goods and services but at
the end of the year, because the banker demands the repayment of 100
pounds ($1,000,000) in principal and 20 pounds ($200,000) in interest at
20%, Council must demand 120 pounds ($1,200,000) of bills in taxes from
the citizens who only received the original 100 pounds ($1,000,000).
Because every level of government uses this super stupid way of
financing civic services, the tax-payers find themselves in the
impossible situation of having to repay a greater amount of money than
is issued into circulation. Interest is the root of the evil.
The solution is to be found in the Bible: "Let the exacting of
interest stop" Nehemiah 5:10. Accepting that credit is only christian
when the exacting of interest has ceased, the major goal of the
Christian Credit Party is the total abolition of interest on credit.
This will be accomplished with the use of small denomination interest-
free bonds in lieu of small denomination interest-bearing bills. If
Abraham Lincoln could get it implemented 100 years ago, we will
certainly get it implemented due to our powerful computer technology.
When elected, a Christian Credit Council would also authorize the
printing of $1,000,000 in municipal bonds to get the snow cleared
except that the mayor would bypass the banker by printing up
$1,000,000 in dollar bonds bearing no interest which happen to weigh
100 pounds.
Council will pay for the $1,000,000 job of snow removal with the
100 pounds of small denomination interest-free bonds instead of the 100
pounds of small denomination interest-bearing bills. Because the bonds
retain the value of the original services performed, inflation will
cease to exist. The merchants and their employees can accept the 100
pounds in bonds from the civil servants in exchange for the same goods
and services that they would have delivered for the 100 pounds in bills
when they realize that at the end of the year, because the banker
middleman was cut out, Council will only have to demand the 100 pounds
($1,000,000) of bonds in taxes to pay for the principal saving them
the 20 pounds ($200,000) in taxes to pay for the interest.
Having demonstrated that small denomination interest-free bonds
cleared the snow as well as small denomination interest-bearing bills,
council will print up enough bonds to hire all the able-bodied people
on welfare and unemployment to build themselves some affordable houses
that can be bought interest-free because they were financed with our
new interest-free paper.
With less people on welfare and unemployment, our taxes must be
reduced. With more people paying their share, our taxes must again be
reduced. The abolition of interest must benefit even the rich man by
resulting in tax cuts so massive as to exceed the spread between what
he gets in interest and what he loses in inflation. In days of old,
interest did benefit the rich man because on foreclosure, the debtor
would become his slave and be put to work. Today, foreclosures do not
add to the rich man's wealth by the addition of profit-producing
slaves but actually decrease his wealth but increasing his taxation to
care for the ever increasing number of unemployed. The abolition of
interest will benefit both the rich man and the poor man.
Though participating is completely voluntary, only those
merchants who have accepted the bonds in lieu of the bills will save
the interest. Those who have not accepted the bonds in lieu of bills
will not save the interest tax and will be allowed to enjoy the ever
increasing taxes that they now enjoy.
THE CHRISTIAN CREDIT ENGINEER
JCT: That was my main political program back in 1982. Then a
couple of years later, I read:
Thursday November 28, 1985,
The Charlotte Observer,
CASH-STARVED ARGENTINE PROVINCES TURNING OUT THEIR OWN MONEY
By Andres Oppenheimer, Knight-Ridder News.
Thursday November 28, 1985,
The Charlotte Observer,
CASH-STARVED ARGENTINE PROVINCES TURNING OUT THEIR OWN MONEY
By Andres Oppenheimer, Knight-Ridder News.
MIAMI -- Two remote Argentine provinces, short of cash to pay
public employees, have come up with an easy solution.
They're printing up their own money, to the chagrin of the
national and international banking authorities.
"We are paying all our public employees with provincial bonds,"
Roberto Romero, governor of the northern Argentina province of Salta,
said in a telephone interview. He said Salta started printing its own
IOUs because it wasn't getting sufficient federal currency fast
enough.
"People can change these bonds for money at any bank," Romero
said. "They can use them to shop at supermarkets and to buy cars or
any other products."
The Argentine government is not smiling, and world bankers are
worried that other cash-starved states will copy Salta's financial
extravaganza and jeopardize Latin efforts to curb inflation and pay
huge foreign debts.
The International Monetary Fund (IMF), the world's main financial
inspector for debt-ridden countries, was concerned enough to bring up
the issue in recent talks with the Argentine government, said sources
in Argentina and Washington. The IMF does not comment on negotiations
with individual countries.
After Salta started quietly issuing its own IOUs in September
last year, the nearby province of La Rioja started printing its own
bonds too. Four other Argentine provinces have either begun adopting
similar programs or are preparing to do so.
In all cases, the bonds are good only within the province where
they're issued.
But the government of President Raul Alfonsin says the provincial
bonds are expanding the country's money supply and are undermining
efforts to remove Argentina from the list of world inflation leaders.
Earlier this year, Argentina had a 1,000% annual inflation rate.
Alfonsin made headlines worldwide in June when he launched an
austerity program built around a commitment to stop his government
from printing money. Since then, inflation has dropped to 3% a month,
a record low in recent history.
The bonds printed in Salta come in denominations of 10, 100, and
1,000 australes, the same as ordinary Argentine currency bills. They
pay no interest and can be either exchanged for Argentine currency or
used to buy goods.
Romero, of the opposition Peronist Party, and officials of other
provinces claim their bonds are not really new currencies because they
are no good outside their provinces.
JCT: So using small denomination bonds as provincial local
currency worked then and it will work now, even with the 7% usury. As
long as the government keeps printing the money to pay the interest,
everything will balance in the end. As long as they're not in debt to
banks who are the only guys who can print the money, all will work
well.
So there, I hope, is the genesis of the LETS bond-currency proven
so effective in Argentina that they used it the last time their money
system broke down and they're having to turn to it again now.
Comments on the latest article:
(1) "New currency spawns anxiety" only in New York banks that
won't be getting any interest on currency created by the Argentines
themselves. The Argentinian workers who accept the bonds will be
getting the benefit. A kind of "demurrage" that LETSers will love but
that a casino chip purist like me finds technically unnecessary though
I'll admit this could prove to be the spark that makes UNILETS go. .
(2) That "Argentines in Buenos Aires province fear patacons are
worthless, David Plumb reports" is quite a misrepresentation. The
three Argentines he quotes do not the province make, especially when
he found them in an insane asylum.
(3) Great, The Engineer's Number One Prime Feature for saturation
is the demand that they "be used as payment for federal or municipal
taxes." Any piece of paper people can pay their taxes with is
instantaneously valuable to everyone, a saturated market. King Henry's
Tallies were government IOUS, Lincoln's and Kennedy's Greenbacks were
too.
(4) Even better than just being able to spend it on taxes. All
those people in the article who kept asking "what's a 1-peso bond
worth?" it's a peso worth water, communications, transportation, or
rent or taxes. If you think it's worthless, throw them out over here.
(5) Still the big question in the article is "How to use the
Patacons?" Of course, a 1 peso bond can pay his water bill as well as
a 1 peso bill, a 1 peso bond can pay his telephone bill as well as a 1
peso bill, a 1 peso bond can get him transportation as well as a 1
peso bill, and a 1 peso bond can pay his house mortgage as well as a 1
peso bill and a 1 peso bond can pay his federal and municipal taxes as
well as a 1 peso bill too. And he's asking "how I'll be able to use
these patacons."
Of course, in the original article, the reporter put the fact
that all the large corporations are going to be taking the new money
at the end of the article and the opinions expressed of his doubters
aren't provably laughable at this point for this reason. So while you
are unaware that all the big companies are going to take it, you can
take their comments seriously. But learning about the companies
earlier, then the stupidity of these quotes becomes clearer.
JCT: (6) We're endangering their anchor. As if it's been such a
great anchor when everyone's screaming that it's not.
(7) When Argentina faced the banks who wouldn't grant the loan,
They said "We'll do like Salta did in 80s: Print our own.
Any bets that Salta is soon on the list. The Province of Salta
was the first of the six provinces who, when they ran out of cash in
the early 1980s, used small denomination interest-free bonds to pay
all their employees thereby causing huge drops in unemployment and
inflation. The same thing will happen here even though their 7%
interest on the bonds is an unnecessary, even if perhaps attractive,
feature. It's not so bad thinking when you think that the worker who
accepts the bond for his labor is going to get the 7% instead of some
foreign New York bank. More on the Salta experiment later.
(8) As for the New York Bond salesman saying that all the paper
that can buy all these things is worthless, did we really expect the
New York bankers to approve an idea where the interest they used to
collect on large denomination bonds that only they could accept going
to the guys who accepted the small denomination bonds for the the work
they did? All that worthless paper that can only pay people's water
telephone, transport and rent bills. Quick, throw all that worthless
money away, says the Financial advisor. Throw it over here.
(9) We know it's not our 7% bond they're talking about so it must
be their 17.5% bond to the New York bankers they're talking about
replacing with the 7% bonds to the workers. And most of the $9 billion
will be used to pay the interest to the New York banks anyway. That's
why it's so important to them and not to Argentine citizens. They
certainly aren't going to see much more it than it passing through
their hands from the IMF to their creditors.
(10) "Already some residents fear the patacon has no value."
Where did he find people as mentally impaired as to ask themselves if
the piece of paper that buys them everything in town has any value or
not? Of course, we still didn't know about all the companies that were
taking
it and so this didn't seem as stupid a statement as we now know it is.
And we know that the reporter was trying to mislead us on purpose.
(11) Though I do like the idea of the feds issuing their own
bond-currency to finance their activities, there's no reason to make
the provinces give up theirs. It's too easy to phase the new out and
get back to interest-bearing bonds to the New York banks again.
Early smears of the system are left unchallenged until the
important facts are printed at the end of the article that defeat the
smears. So I moved the last few paragraphs to the front. Certainly
did change things, didn't it. That's an easy way to defeat propaganda
pieces. Look at the part they put last first.
And finally, Argentina already has the world's largest private
LETS with over half a million people. So even if the governments
hadn't stepped in, many were already finding a legitimate source of
alternate currency to Trade Employment Locally.
Financial pundits may be fuming and forecasting destruction, but
just like they forecast worse inflation in the 1980s and inflation
went down, not up, from an injection of healing currency, so too, even
with the 7% bonus and despite the same kind of dire forecasts, I'll
bet that things will get better from now on, not worse.
Investors betting on Argentina early will reap the rewards.
--
John C. "The Banking Systems Engineer" Turmel, Author of the UNILETS
interest-free time-based currency United Nations C6 recommendation to
Governments in the http://www.un.org/millennium/declaration.htm
Visit http://www.cyberclass.net/turmel / http://www.medpot.net
------------------------ Yahoo! Groups Sponsor ---------------------~-->
Get your FREE credit report with a FREE CreditCheck
Monitoring Service trial
http://us.click.yahoo.com/M8mxkD/bQ8CAA/ySSFAA/OnSolB/TM
---------------------------------------------------------------------~->
To unsubscribe from this group, send an email to:
[EMAIL PROTECTED] or a message
to [EMAIL PROTECTED]
Your use of Yahoo! Groups is subject to
http://docs.yahoo.com/info/terms/
--- end forwarded text
--
-----------------
R. A. Hettinga <mailto: [EMAIL PROTECTED]>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
---
You are currently subscribed to e-gold-list as: archive@jab.org
To unsubscribe send a blank email to [EMAIL PROTECTED]
Did you know that e-gold Ltd. stores more gold on behalf of customers
than many countries? See http://www.gold.org/Gra/Gra1.htm and the
e-gold Examiner at http://www.e-gold.com/examiner.html for details.
