
BerkShares - grzm
https://en.wikipedia.org/wiki/BerkShares
======
outsidetheparty
Greetings from Berkshire County! BerkShares don't actually exist, as far as I
can tell. I occasionally run across news stories about them, but I've never
seen one and have never met anyone who's ever seen one (and I've asked around,
because it's weird seeing news stories about things in your hometown that as
far as you can tell don't actually exist.)

~~~
frikk
what the hell? this is more interesting than the Berkshares themselves.

~~~
outsidetheparty
I mean, I'm not claiming it's a fraud or anything like that; I'm sure they
actually did print these and that some business probably do accept them, like
any other kind of coupon. Just that they're, well, not much more than any
other kind of coupon.

According to their list of businesses, apparently my ex dentist accepted them.
Missed opportunity there I guess. ¯\\_(ツ)_/¯

------
bigdubs
Grew up in a town that used these (a town in berkshire county, ma); I thought
they were a novelty and didn't really buy or use any (or see anyone use them).
Just a single datapoint.

~~~
xemdetia
Yeah this is not a common denomination. I never saw any of these in the 5
college areas. It just looks like the common chamber of commerce local
business promotion scheme than anything too serious.

------
okreallywtf
This is interesting, thought I am having a hard time determining what make
this different enough from Liberty Dollars [1] which made a splash in NC years
ago. Liberty Dollars were supposed to be worth the metals they were
constructed of, so they were not pegged to any currency but their intended use
was much the same (finding local businesses that would accept them). It seems
odd that the purveyors of liberty dollars were arrested and other private
currencies are allowed? The main complaint I saw was that they were too
similar to "real" US currency, but the response seems exaggerated if thats all
it really was.

[1]
[https://en.wikipedia.org/wiki/Liberty_dollar_(private_curren...](https://en.wikipedia.org/wiki/Liberty_dollar_\(private_currency\))

~~~
rothbardrand
It was exagerrated-- the "crime" of liberty dollars is that one of the
distributors in NC was the ex-husband of an FBI agents sister, who was bitter
about the situation and the FBI Agent decided he could make a terrorism case
out of it and in the process steal a great deal of money via Asset
Forfeiture-- which they did, including tens of thousands of Ron Paul
Presidential Campaign Copper pieces (literally presidential campaign
propaganda stolen by the FBI, in violation of the First Amendment and making
all involved at the FBI felons under USC 18-242) not to mention something like
$6M in Gold, Silver and Platinum pieces.

Then they railroaded the Liberty Dollar defendants with fraudulent (in my
opinion) jury instructions telling them that a silver piece 10 times the size
of a dime that also has a picture of the statue of liberty's torch was
"identical" to US Currency under the law... despite Liberty Dollar having
letters from the Secret Service, federal reserve, etc, expressing the legal
opinion that they were legal and the like.

It's just a joke.

This case is the one that proved to me that not only is government corrupt,
and will steal money, but that it doesn't even follow its own laws, and a
large portion of the population will cheer on this corruption (the issue when
it got posted to HN was met with a lot of liberals cheering it on because
liberals are in favor of the inflationist fiat monetary regime and think that
"kooks making money out of silver" should somehow be prosecuted.)

~~~
dj-wonk
Re: "This case is the one that proved to me..." I wonder if you are
overgeneralizing here.

Sure, there are cases of corruption involving the government. Did you intend
to say something broader? Proving systemic or structural corruption is another
thing.

The question we should be asking, in my opinion, is not "Are all governments
corrupt?" but rather "To what degree are particular people and particular
institutions acting in corrupt ways."

Fighting corruption is hard. We win some and we lose some. Our goal should be
to win more often.

~~~
okreallywtf
Ironic, especially because the FBI is one of the primary law enforcement
agencies _investigating_ corruption [1] [2] [3]. It is almost like its a big
organization that can't be summed up by a single statement.

[1] [http://www.postandcourier.com/politics/fbi-investigating-
sou...](http://www.postandcourier.com/politics/fbi-investigating-south-
carolina-statehouse-corruption-could-expand-scope-
of/article_954c1d06-6ca5-11e7-953d-9f2de89f849c.html)

[2] [https://www.usatoday.com/story/news/nation-
now/2017/08/14/fb...](https://www.usatoday.com/story/news/nation-
now/2017/08/14/fbi-went-undercover-floridas-capital-and-fallout-could-
huge/566090001/)

[3]
[http://www.charlotteobserver.com/news/local/crime/article715...](http://www.charlotteobserver.com/news/local/crime/article71567637.html)

------
TuringNYC
Very similar to Ithaca Hours
([https://en.wikipedia.org/wiki/Ithaca_Hours](https://en.wikipedia.org/wiki/Ithaca_Hours))
which were sparsely used in Ithaca at the farmer's market while I attended
Cornell

~~~
lxmorj
Sparsely used, but talked about ALL THE TIME

------
arjie
It reminds me of the [https://bristolpound.org/](https://bristolpound.org/)

~~~
tshanmu
and [http://brixtonpound.org/](http://brixtonpound.org/)

~~~
yaway
Paddy's Dollars
[https://www.youtube.com/watch?v=cyxxE1AcUSM](https://www.youtube.com/watch?v=cyxxE1AcUSM)

~~~
mesozoic
And Schrute Bucks
[http://theoffice.wikia.com/wiki/Schrute_Buck](http://theoffice.wikia.com/wiki/Schrute_Buck)

~~~
christoph
Lewes Pounds
[https://en.wikipedia.org/wiki/Lewes_Pound](https://en.wikipedia.org/wiki/Lewes_Pound)

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tudorw
As an aside, the Transition organisation here in the UK back a few currencies,
the
[https://en.wikipedia.org/wiki/Totnes_pound](https://en.wikipedia.org/wiki/Totnes_pound)
is well supported, this is not new, here's a good piece on 'time based
currency' [https://en.wikipedia.org/wiki/Time-
based_currency](https://en.wikipedia.org/wiki/Time-based_currency) and
[https://en.wikipedia.org/wiki/Local_exchange_trading_system](https://en.wikipedia.org/wiki/Local_exchange_trading_system)
which has some traction in the UK, though their website could do with a little
help,
[http://www.letslinkuk.net/index.htm](http://www.letslinkuk.net/index.htm)

------
colanderman
Note that the manufacturer of the paper used in US currency (and many others
around the world), Crane, is located in the Berkshires. Hence part of the
reason why the currency looks so good.

~~~
busyant
I grew up in the Berkshires and worked at Crane (making paper for the currency
of several countries).

Strangely, I've never heard of BerkShares.

~~~
awojtasz
Never heard of them either - from north county.

~~~
cowabungabruce
Grew up in Pittsfield. Went to South Berkshire schools. Also never heard of
them.

But I still have a Berkshire Bank card in my wallet!

------
rurounijones
While not exactly an economist / finance type I would have thought the federal
and state governments would have shut this down as it removes a certain level
of currency control no?

Can anyone explain the legalities around this?

~~~
jakebasile
The funny money here is stilled pegged to the US dollar, so the Fed can still
exercise monetary control over it. It's really just a form of gift certificate
(or scrip) from my reading of it. Anyways, there's a history of using non-USD
money in the US: see company towns that only dealt in company scrip, Disney
Dollars, etc.

No matter what you're making money in, the government expects to be paid, and
it only accepts US dollars.

~~~
EGreg
The history of non USD goes back way further than that. Historically, the
Federal Government was in charge of the coins but banks issued paper Banknotes
which circulated. Then during the Civil War the federal government issued
notes with which you could pay tariffs and land taxes. These became popular.
It was only a few years later that the Legal Tender laws were passed, making
the Greenback the most-accepted banknote in America.

[https://en.m.wikipedia.org/wiki/Greenback_(1860s_money)#Pre-...](https://en.m.wikipedia.org/wiki/Greenback_\(1860s_money\)#Pre-
Civil_War_period)

Having said that, most of our money today is credit money in bank networks,
like VISA or Paypal. In China it had a meteoric rise with WeChat etc.

My company is working on a platform that will allow ANY community to issue its
own currency. And no, I don't think there is any requirement to have it pegged
to the dollar.

~~~
redblacktree
I looked at your profile and I didn't see the company you're talking about.
Would you please provide a link?

~~~
EGreg
Sure.

[https://qbix.com/blog](https://qbix.com/blog)

Feel free to get in touch - the email link is in my profile.

------
TACIXAT
>Nick Kacher of the Schumacher Center has discussed the possibility of pegging
its value to a basket of local goods in order to insulate the local economy
against volatility in the US economy.

Is there a name for pegging a currency to a basket of goods? I can't find any
examples online.

~~~
EGreg
If it's a local currency this can be considered a local Consumer Price Index.
If you peg the local currency to it, the local currency is always available to
buy the food, based on the local CPI of necessary goods, regardless of
shortages etc. (if the pegging is daily).

I had a similar scheme for local based UBI here:
[https://qbix.com/blog/index.php/2017/09/the-future-of-
money/](https://qbix.com/blog/index.php/2017/09/the-future-of-money/)

~~~
TACIXAT
Awesome, thanks. It sounds like you're working on some of the ideas I've been
mulling over this week. I like the idea of localizing the currency and having
immigration restrictions. Localizing helps solve the problem of scaling
pseudonym parties. Finding a world-wide, or even nation-wide time where
everyone can show up in a group in order to verify their personhood would be
tough.

I guess the next issue is how do you take that CPI, adjust, and issue currency
in a decentralized / consensus way. Also, how susceptible to manipulation
would these schemes be.

I would love to see a more economically sound cryptocurrency, rather than the
deflationary mess that is Bitcoin.

~~~
cobber2005
Related to deflation - I believe there are demurage schemes for local
currencies where the value of a particular bill lessens over time. It
incentivises circulation instead of hoarding.

------
ceejayoz
Ithaca, NY has (had?) a similar system:
[https://en.wikipedia.org/wiki/Ithaca_Hours](https://en.wikipedia.org/wiki/Ithaca_Hours)

~~~
oatsandsugar
A superior system.

1 hour = 1 hour of work (rather than a USD equivalent). Or at least, that is
how it started.

~~~
seangrogg
And everyone's hours are treated interchangeably?

~~~
gertef
They are HOURs, not "hours"

> One Ithaca HOUR is valued at US$10 and is generally recommended to be used
> as payment for one hour's work, although the rate is negotiable.

------
kijin
There seem to be a lot of these "community currencies" in circulation
throughout the United States. I wonder how much economic activity actually
takes place using them, though. Millions of dollars? Billions?

[https://en.wikipedia.org/wiki/List_of_community_currencies_i...](https://en.wikipedia.org/wiki/List_of_community_currencies_in_the_United_States)

Meanwhile, up north, there's Canadian Tire Money.

~~~
andybass
My company (Conpoto), runs a local currency/gift certificate platform that is
purchased with regular dollars, but is only redeemable at local merchants
participating in the program. We're in a bunch of states and Canada.

We'll do hundreds of thousands of dollars in currency purchases annually in
some communities. It's used quite a bit by employers who want to keep money
local (rather than sending it to Amazon or Target).

~~~
rocqua
On the face of it, that feels like companies issuing their own currency to
control their employees. If leaving the company means moving somewhere your
money isn't accepted, you won't leave. If you won't leave, the companies can
screw you and you have to take it or lose all your savings.

~~~
andybass
Sorry - I should have clarified more. These companies are using the currency
for small rewards, holiday gifts, etc - as opposed to as a salary.

------
stdclass
We had something similar in Tyrol, Austria called Freigeld (1)

(1)
[https://en.wikipedia.org/wiki/W%C3%B6rgl#The_W.C3.B6rgl_Expe...](https://en.wikipedia.org/wiki/W%C3%B6rgl#The_W.C3.B6rgl_Experiment)

------
brwnll
There was a good Odd Lots podcast covering this:

[https://www.bloomberg.com/news/articles/2017-03-27/odd-
lots-...](https://www.bloomberg.com/news/articles/2017-03-27/odd-lots-what-
the-berkshires-learned-by-launching-its-own-currency)

------
ww520
So the issuing banks print a BerkShare, sells it for $.95US to the public, and
got to keep the $.95US. Hmm, anything that I missed that would dampen my
enthusiasm to be an issuing bank?

~~~
s17n
They are pegged against the dollar, meaning that the bank agrees to buy it
back for what they paid for it. So basically, the issuer is taking out a zero
interest loan from the users of the currency. Not a bad deal considering that
the bank doesn't have to do any of the work involved in their typical source
of zero-interest money (checking accounts).

~~~
clhodapp
Isn't it the other way around? The bank is issuing a zero interest loan to the
currency user? What benefit does the bank get from there being more Berkshares
out in the world?

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fiatjaf
Since it is pegged to the dollar why doesn't it qualify as pure waste of time?

~~~
rocqua
you pay $0.95 but it is accepted as $1 so you effectively get a 5% discount.
This is done to incentivize spending locally.

~~~
fiatjaf
Makes sense.

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valuearb
Virtually all the wealth created in the world is because of unfettered trade.
Trying to create an insular economy is just a path to poverty. Are they going
to build their own iPhones, Teslas, LCD screens and microprocessors? Obviously
not.

When a local consumer decides to pass on buying a local good for a substitute
made far away, it's because they believe they benefit economically from doing
so.

~~~
skrowl
That would be true if currencies couldn't be converted / traded. Nothings
stops you from trading Berkshares for USD or vice versa the same way you would
Euros / Bitcoins / etc.

~~~
valuearb
The 5% discount does.

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JustAnotherPat
why not create a crypto version that would be distributed to current currency
holders? Get rid of the costly cash and you can sell it worldwide if you want
to, while Berkshire residents control voting rights on the blockchain. With
current crypto prices going sky high, bring some real money into the economy.

~~~
userbinator
...and thus begins BerkCoin... a name which surprisingly hasn't already become
a cryptocurrency.

