Budget for interest rate increases

[Marq]

At least the banks have some level of oversight.

Arrrggggg......we were doing so well up to this point.

Even though barter has its downside, there has to be a mechanism along these lines that can work outside the controlling banking system. Barter offers a potential alternative or at least a potential that can maybe be worked into a viable system. We just have get back to basics, keep it simple and pull out the human survival type conditions that relate to a maslows needs rather than a - where am I going to get my next buck from needs - and stop turning to the banks for support that they will never give. Their 'level of oversight' is unacceptable given that they only have themselves in this picture.

[sgafc]

Most Bartering systems do not try to supplant, normal cash. Some schemes actually endeavour to boost cashflow. And your are correct, controlling the bartering system can lead to all sorts of problems.

Our banking system, however is not clean. It is believed that the banking system is corrupt to the core. An alternative exchange mechanism may only work if the banking, "money out of nothing" system is destroyed.

Banks will have to close their doors if no one made loans, overdrafts or used credit cards. And that is even staying within the banking system, using only money in accounts, by paying cheques within limits(without overdrafts or overdrawn facilities), using debit cards.

If banks start loosing money, due to less excessive interest(prime plus), maybe only then can we exert pressure on them to either get their act together or close shop.

The concept is simple. If I have R1000.00 in my account, I can only spend
R1000 nothing more. Spending money we dont have, on things we dont need is the biggest contributor to our current debt crisis.

Overdrafts are another controversial "loan". Many businesses think they cant survive without it. Unless an overdraft is strictly used as a tool that finances working capital, and reverts to a nil or favourable balance, sometime, the user of an overdraft is in big trouble(ask many a business owner who was faced with a reduction facility, myself included) and the unfair charges and interest. All the so called benefits are outweighed by the subsequent problems. The reality is, we only have the benefit of an overdraft, once, therafter it becomes a nightmare.

Coming back to the money system. If we not going to look at another method of exchange, we will have to take action(peaceful, non violent, non compliance with the banking system). We cant whine and whinge about bank charges and interest rates and do absolutely nothing about it.

[wynn]

A barter exchange seems like a great idea, even the PE paper has a swop column where you put your requirements up, say, "Mountain Bike, Nishike, R1500 or what have you"

So I could publish on a 'Barter Exchange site 'new bathroom needs to be plumbed R15,000, what have you?' provided I have something of equal value to barter.
The plumber then looks at what else is on the site to the value of R15,000 sees a bakkie he likes and so on until someone sees my ad for 'antique dining room suite' that they want and so the circle completes and everybody is happy?

I agree that it won't work with a credit system because someone will rip you off, but if you all have one or many things adding up to same value, material or labour, you have a deal.

[Graeme]

Read a book titled 'The Darling Buds of May' a riotously funny book about bartering and paying no tax.

[sgafc]

Bartering is not the only way to go. Alternative currencies can maybe help.

I use the services of a company that draws debit orders on my behalf from my clients accounts. Before any debit order can be logged, the clients signs a contract. The discount company that I use have a website, where I can see all the debit orders registered.

In terms of an arrangement with this company, I have my staff salaries paid directly from this account. Last month I started using the facility to pay my creditors directly from the proceeds of a particular d.o. run. My reasons for migrating to this system is due to an aversion to the banking system, as highlighted before. I envision a scenario where 60 to 80% of my bills will be paid this way.

Now take the scenario above, and replicate it on to a non-cash situation.
1. An organisation/ company is established with the sole purpose of managing units of exchange.

2. Units equal to a rand is created, lets call these units "Freedos"(freedom)

3. 1 freedo=R1 or whatever other currencies.

4. Interested participants buy 1000 freedos at R1 each.Once purchased they are furnished with a (debit)card and password.

5. This password, enables them to log on to a website, where they keep track of their freedos.

6. When they make purchases, their freedo balance is debited.

7. They credit their freedo account with any sales services to any interested party, in the same manner as highlighted in the debit order scenario.Debits to paying customers, and credits to selling merchants.The card can be swiped at machines or processed on a website of an approved merchant.

8. The managing company, will derive income from an admin or service fee, but will not charge any interest.(interest can be manipulated).

9. All transactions are recorded for tax purposes.(laws are obeyed).

This might look simplistic, but if we look at the manner, in which it operates with the debit order company, where I deal with NO cash, and yet my bills are still paid, it might work. Bear in mind, that the values we deal with here are only, Rand-values, but no cash changes hands. And every transaction is completely transparent.

The banks have been doing the same thing, "figures on computer screens", debits on cards, cheques etc are moved around as "money", and they start charging interest on it.
Only difference with my suggestion, is that the UNITS/Freedos, will come into existence through real purchases, not DEBT!

What is done with the "real cash " raised from Freedo sales?This is transferred into a reserve, which can fund interest free loans to small businesses!