It has long been my position that a real alternative to fiat money as a means of payment requires reclaiming the “credit commons,” i.e. establishing community control over credit. It is producers and sellers of real value who are the ones who are actually qualified to issue a currency into circulation. They can do so individually by using their own private voucher currencies redeemable for the goods and services they are ready, willing, and able to provide, or they can do it in cooperation with others by pooling their commitments and jointly issuing a common voucher currency. Such a currency can then circulate generally for other to use to pay one another instead of using dollars. Euros, pounds, or other government fiat currencies.
My paper titled, Invoice Factoring as the Basis for a Digital Token Currency, presented at the RAMICS Conference in Rome on November 6, 2024, describes how that can be achieved by creating a digital token currency that, unlike present-day crypto currencies, is based on, and redeemable for real goods and services. This presentation describes the structure, processes, and protocols for creating and circulating a digital voucher token currency on a continuous recurrent basis. I’ve summarized my proposal in this 12-minute video posted on YouTube.
Chapter 16 is the latest Chapter in my new updated and expanded edition of The End of Money and the Future of Civilization. The link to this chapter is now listed along with the other previously published chapters on the book page along with links to the audio narrations by Ken Richings. Scroll down to find Chapter 16 there or click here to go directly to the PDF file.
Here are the Chapter contents:
Figure 16.1 A Typical Small Boat Harbor (Drawing by Dennis Pacheco)
The Orthodox Approach to Community Economic Development
A Comprehensive Community Economic Development Plan
Stage I: Map the Local Actors and Assets & Promote Import Substitution
Stage II: Support Structures for Localization—Saving, Investment, Finance, and Education
Stage III: New Liquidity Through Trust—Mutual Credit as a Way to Pay How It Works Key Benefits The Generation and Allocation of Trade Credits
Stage IV: The Credit of “Trusted Issuers” Can Provide a Local Alternative Currency for General Circulation
Stage V and Beyond: Transition to an Objective Measure of Value and Unit of Account
If the BRICS ever hope to escape the orbit and dominance of the Western Empire they will need to organize an international clearing Union under their own control, along the lines of the Bancor proposal of John Maynard Keynes which he put forth in 1944 at the Bretton Woods conference. If that proposal had been adopted it might have saved the world 80 years of grief and violent conflict.
Further pertinent information from Alistaire Crooke
Today, out of curiosity, I asked Copilot this question:
“How would E. C. Riegel organize the exchange of value among producers and intermediaries in the distribution process?”
Here is Copilots’ surprisingly accurate response to that question. It is, in effect, a brief summary of his book Private Enterprise Money.
E. C. Riegel envisioned a radically decentralized and voluntary system of value exchange that bypassed both government-issued money and centralized banking. His proposed framework, known as the Valun Exchange System, was designed to empower producers and intermediaries to coordinate trade through a self-regulated, non-political monetary mechanism.
Here’s how it would work in practice:
1. Voluntary Association of Producers: Producers and intermediaries would form a cooperative network called a Valun Exchange. Membership would be voluntary and based on mutual trust and creditworthiness.
2. Private Credit as Currency: Instead of using state-issued money, members would issue credit to one another in the form of Valun units. These units would be backed by the members’ productive capacity and promises to deliver goods or services—not by gold, fiat, or government decree.
3. Accounts, Not Cash: Transactions would be recorded as debits and credits in members’ accounts, similar to a mutual credit system. No physical currency would be needed; the system would operate through bookkeeping entries.
4. Intermediaries as Facilitators: Distributors, wholesalers, and retailers would participate as both buyers and sellers, using their Valun accounts to settle transactions. Their role would be to facilitate the flow of goods, not to extract value through speculative finance.
5. Self-Limiting Credit: A member’s ability to issue credit would be limited by their past performance and the confidence of the network. This would prevent inflation and ensure that credit was grounded in real economic activity.
6. No Interest, No Taxes: Since the system was private and voluntary, it would not involve interest-bearing loans or taxation. Riegel believed this would eliminate many distortions in the traditional monetary system.
In essence, Riegel’s model treated money not as a commodity or a government tool, but as a social contract among producers—a means of measuring and facilitating exchange based on trust and productivity. It was a bold attempt to return the power of money creation to the people actually producing value.
If you’d like, I can sketch out a visual flow of how this system would operate among producers, intermediaries, and consumers.
To that offer, I answered, “yes,” but in successive attempts Copilot failed to produce an accurate flow diagram. I have for many years been using my own diagram of credit flows in mutual credit clearing systems. Here it is below. If you substitute the word “valun” for “Currency vouchers,” this diagram shows exactly what Riegel was describing:
The “Trusted Producer” depicted in the upper right begins the process by using their line of credit to purchase something for an employee, supplier or contractor. Those credit vouchers then flow in the numbered sequence, the final step being when the Trusted Issuer accepts them back in payment for the goods or services they sell, thus completing the circuit of reciprocity. Note that at each step of the way, goods and services are circulating in the opposite direction to the voucher credits (or valuns).
I then pointed out to Copilot that it had failed to specify the units in which valun credits were to be denominated. This was its response:
Great point, Thomas. Riegel proposed that all debits and credits in his system would be denominated in a unit called the Valun—short for “value unit”. This was not just a name, but a deliberate attempt to establish a new standard of value independent of national currencies and political influence.
At the system’s launch, the Valun was intended to be roughly equivalent in purchasing power to the U.S. dollar, simply to ease adoption and pricing familiarity. However, over time, its value would be maintained internally by the productivity and trustworthiness of the network’s members, not by fiat or commodity backing.
So, in essence, every transaction—whether between producers, intermediaries, or consumers—would be recorded in Valuns, making it a closed-loop accounting system grounded in mutual credit and real economic activity.
Would you like a breakdown of how Valun pricing might work in practice, or how it could be stabilized over time?
I already knew how Riegel proposed to stabilize the Valun pricing unit, and I am not satisfied with it being adequate. I make my case in a document which Copilot cited as a source; it is contained in a previous post to my website, E. C. Riegel’s Valun Mutual Money Plan, but the reference was to a site other than my own. It would be better to read the original post on my site. That post contains the full text of the Valun Mutual Money Plan, together with my comments and critique. I believe that serious students would do well to read it.
Chapter 15 is the latest Chapter in my new updated and expanded edition of The End of Money and the Future of Civilization. The link to this chapter is now listed along with the other previously published chapters on the book page along with links to the audio narrations by Ken Richings. Scroll down to find Chapter 15 there or click here to go directly to the PDF file.
This is the latest chapter to be published of my new 2024 edition of The End of Money and the Future of Civilization. It continues the exposition begun in Chapter 13, elaborating upon sound principles of credit allocation and management, highlighting what did not work and why, and describing in detail what it takes to make an exchange alternative succeed. It answers crucial questions like:
Who Is Qualified to Issue Currency?
On What Basis Should Currency Be Issued?
How Much Currency May Be Issued?
How to Determine the Period of validity?
And considers strategies for successful launch and implementaion, with due regard for the broad situational context into which an alternative currency or credit clearing exchange may be introduced.
This is the latest chapter to be published of my new 2024 edition of The End of Money and the Future of Civilization. It provides a comprehensive overview of the alternative exchange movement over the past several decades and its present state, along with important case studies, lessons learned, and prescriptions for significant performance improvements.
Here is a list of section headings with a few brief excerpts:
A currency, to be effective, must be SPENT into circulation. — Thomas H. Greco, Jr
Two Currents of Alternative Exchange
The Tucson Experience
More Recent Experiments in Mutual Credit Clearing In order for a mutual credit clearing exchange to be scalable and successful over the long run,
The allocation of credit lines cannot be arbitrary but must be based primarily on the value of the goods and services that each participant is prepared to sell within the exchange circle, and,
The project must be anchored in the local business community, especially the small- and medium-sized enterprises that form the backbone of every local economy and are the providers of people’s everyday needs.
Local Currencies
A Better Currency Model A sound, credible, effective, and scalable currency does not need to be redeemable for conventional money, the issuer needs only to provide credible assurance that its currency can be readily redeemed for some goods or services that are in general demand. Private or community currencies that are SPENT into circulation by trusted issuers, like utility companies, goods producers, or municipal governments, have much greater potential for promoting local community prosperity, resilience, and self-determination because they allow a community to monetize the value that is created and sold by local businesses and professionals. The internal “trade credits” provided to members of mutual credit clearing associations, like those being created by the scores of commercial “barter” exchanges that operate around the world, do the same. Such home-grown sources of liquidity enable a community to greatly reduce its dependence upon official money and bank borrowing, and to automatically favor local production and local sourcing of goods and services, thus reducing dependence upon imports and global corporate providers.
This is the latest chapter to be published of my new 2024 edition of The End of Money and the Future of Civilization. It summarizes the dimensions of the money problem and the pathways toward solving it as we described them in the previous chapters, and elaborates upon the various functions of money and finance and how they can be handled in ways that are honest, fair, and empowering.
Here is a brief excerpt:
The political money system is the keystone in the arch of power. —Thomas H. Greco, Jr.
Having laid the necessary foundation in the first eleven chapters, we can now proceed to summarize the requirements for solving the money problem. We have shown how money has been politicized and how the control over its creation and allocation has become, what I call, “the keystone in the arch of power,” a power which is at once financial, economic, political, and social. Those who control money are able to control everything else. The inherent dysfunctions of the present monetary regime derive mainly from the following structural elements:
The monopolization of credit by the banking cartel in collusion with national governments
The creation of money by banks as interest-bearing “loans”
Legal tender status for official debt-money
The elimination of any operational concrete measure of value and unit of account
We have seen how that system:
Enables national governments to finance endless wars and other projects that are wasteful, destructive, and contrary both to the wishes of the citizenry and to the common welfare
Enables banks to reap inordinate profits while deciding to whom and for what purpose the money shall be distributed among “borrowers”
Gives a small, elite “super-class” the non-bona-fide money to acquire an ever-increasing proportion of the world’s real wealth and the ability to control political and economic affairs worldwide
Forces the exponential growth of debt, and destructive competition for an always-insufficient supply of money for all debts to be repaid
Emerging Exchange Alternatives
The most graceful and promising approach to empowering ourselves and our communities is through voluntary, entrepreneurial activities that can liberate the exchange process and reclaim “the credit commons.” So long as people have the freedom of association and the right to contract it will be difficult if not impossible for governments to prevent the creation of exchange media and mechanisms by private initiative. We can thereby, step-by-step, reduce our dependence upon bank borrowing and political currencies, taking control of our own credit and organizing independent means for allocating it directly to those individuals and businesses that we trust and wish to support. Riegel reminds us that, “there is no constitutional or statutory barrier to the inauguration of a private enterprise, non-debt, non-interest, mutual money system.” Only popular control of credit and competition in currencies can transcend the money problem. As Ulrich von Beckerath has observed, “Extension of exchange transactions without State money is in reality the beginning of a new system of settling accounts, indeed the beginning of a new economic order.” A new economic order is precisely what is needed at this point in history.
This is the latest chapter to be published of my new 2024 edition of The End of Money and the Future of Civilization. It continues the story about “credit clearing” that was begun in the previous chapter and shows how it will revolutionize trade and payments and make money, as we have known it, obsolete.
Here is a brief excerpt:
If there were no money, any system of crediting sellers and debiting buyers would be fully competent to accomplish the work now performed by money. – Hugo Bilgram, 1914
In Chapter 10 we explained that the highest stage in the evolution of reciprocal exchange is “credit clearing,” and that banks have been using it for the past few hundred years to settle obligations amongst themselves. In this chapter we will further describe the history and applications of credit clearing, and we will show how clearing can be used to offset claims among not only groups of banks, but also among any persons or entities that have financial claims against one another. Most significantly, it is a process that may be applied among buyers and sellers of goods and services to directly offset their respective claims without involving banks as middle-men and without the need for conventional bank- or government-created currencies.
Direct Clearing Among Buyers and Sellers
Credit clearing is actually an ancient process. During the Middle Ages, credit played a major role in the various European “market towns” which hosted, at regular intervals, trading fairs in which merchants from widely scattered areas would gather to trade their goods. It is reasonable to conclude that the process of credit clearing would have been fundamental in their trading activities. This is evidenced by the fact that these market towns typically provided market courts for settling disputes under “merchant law” that was separate from common law and could be adjudicated in a matter of hours or days. James Davis points out that, “At the pettiest level of sales credit, many traders appear to have acted both as creditors and debtors, and there is evidence for running accounts, reciprocal dealings and a ‘complex of claims and counterclaims,’” and that, “Credit oiled the wheels of trade, and market courts dealt in small-scale sales debts that were integral to local retail and wholesale commerce. A market court ostensibly lowered transaction costs and thus attracted more traders by aiding a perception of the market as ‘fair, affordable, efficient’”.
The possibilities of direct credit clearing among buyers and sellers have long been recognized. In modern times, as early as 1914, Hugo Bilgram and L. E. Levy noted that, “If there were no money, any system of crediting sellers and debiting buyers would be fully competent to accomplish the work now performed by money.” They further suggested that:
“Were a number of businessmen to combine for the purpose of organizing a system of exchange, effective among themselves, they could clearly demonstrate how simple the money system can really be made. The greater the number of businessmen that would thus cooperate, the more complete would be their own emancipation from the obstruction to commerce and industry which existing currency laws impose.”
They then went on to propose such a system and describe how it might operate, which I summarized in one of my previous books and in a website post. I’ll not repeat that here because the context today is much different from what it was in 1914, but we will present a similar proposal based on what has since been learned and tailored to our current realities. I believe that it is no exaggeration to say that the creation and operation of such credit clearing systems is crucial to reversing the present trend toward economic ruin and global tyranny and changing the course toward realizing our human potential and the emergence of a peaceful, convivial civilization in which all can thrive.
You can read or listen to the entire chapter here.
The first edition of my book, The End of Money and the Future of Civilization, was published by Chelsea Green Publishing in 2009. While it remains as relevant today as it was when first published the printed book has been out of print for several years. But, having had the rights reverted to me by my publisher, I am making the entire book available for free in PDF format. You can read it or download it HERE. If you would like a hard copy of the first edition used copies can still be found on Amazon.com, Abe books, Thrift books and elsewhere.
Better still, you can avail yourself of the new revised and expanded 2024 edition which I have been working on for almost two years and is almost complete. Eighteen chapters have already been posted and can be freely read or download HERE.
To order signed copies of my previous books, click on the title below:
Beyond Money 