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What monetary system would you create?

I recently returned from attending the Anarchopulco 2019 conference in Acapulco, Mexico. One of the sessions discussed the wide range of options available to a newly established homestead positioned in the Pacific Ocean off the coast of Thailand far enough offshore that it is beyond the jurisdiction of any government. The company that manufactured this home, which has a planned life of more than a century, hopes to soon have a community of at least 20 such autonomous residences in this neighborhood.

As part of the program, the speakers divided attendees up into small groups to consider a series of subjects. One of the questions was what kind of monetary system would make sense for such a community outside the control of any government.

The most common suggestions on this topic were either a cryptocurrency, gold and silver, or some kind of barter system. I don’t recall that there were any suggestions to use an existing fiat (paper) currency issued by any government.

Among the most desired attributes of anything used as a medium of exchange are portability, divisibility, durability, homogeneity, identifiability, and stability of value. Just about anything that would meet all of these requirements would find general acceptance. Without one or more of these features, potential monetary usage is limited at best and probably not practical at all.

Note that none of these attributes requires that they be grounded by any government. In fact, the concept of money was not originated by governments. Although I cannot find a consensus on how money came to be created, the most plausible argument to me is that it was created to pay mercenaries who lived in lands different from where they worked. Such mercenaries needed payment forms that would be useable in many lands. So, the earliest governments that struck coins merely adopted the values of gold and silver that were already trading privately.

Looking into the future, there is another attribute that could become just as important as those noted above—transportability over great distances. I’m not just talking about from one continent to the next. Think in terms of between residents of Earth, the Moon, colonies floating in space, colonies on planets in other galaxies, and the like. This may seem like the problem is far off in the future. But a solution will almost certainly be required long before then.

In my mind, the private sector can produce a viable answer as to what would be the optimum medium of exchange at any time in any place.

But, if the decision were left up to you, what monetary system would you propose right now to be used in this developing community outside of any government jurisdiction?

Patrick A. Heller was the American Numismatic Association 2018 Glenn Smedley Memorial Service Award, 2017 Exemplary Service Award, 2012 Harry Forman Dealer of the Year Award, and 2008 Presidential Award winner. He was also honored by the Numismatic Literary Guild in 2017 and 2016 for the Best Dealer-Published Magazine/Newspaper and for Best Radio Report. He is the communications officer of Liberty Coin Service in Lansing, Mich., and writes Liberty’s Outlook, a monthly newsletter on rare coins and precious metals subjects. Past newsletter issues can be viewed at http://www.libertycoinservice.com. Some of his radio commentaries titled “Things You ‘Know’ That Just Aren’t So, And Important News You Need To Know” can be heard at 8:45 a.m. Wednesday and Friday mornings on 1320-AM WILS in Lansing (which streams live and becomes part of the audio and text archives posted at http://www.1320wils.com).

 

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