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Photo: Yasmin Amer / WBUR.
Leah Barber, a volunteer member of the BerkShares board, shows off the local currency in its paper form. Local currency benefits local businesses.

Back when I was working at the Boston Fed, I sometimes covered innovative currencies in the magazine. I was especially interested currencies that were designed to help local communities. BerkShares was one. Recently, I learned that not only is the paper money still in use in the Berkshire region of Massachusetts, but it’s expanding to include a digital option.

Yasmin Amer reported at WBUR radio, “At The Magic Fluke in Sheffield, rows of wooden string instruments line the wall: ukuleles, violins, and a triangular instrument called the fluke.

” ‘The look is different, the sound is a little different,’ said Dale Webb, who designed the fluke. ‘It’s got a richer, fuller sound.’

“Dale and Phyllis Webb co-own this shop, where a basic instrument runs about $250. Since most customers don’t carry that much cash, most opt to use their credit cards. That comes with a fee for the business.

” ‘If somebody spends money at our store mostly with credit cards, I’m paying anywhere from 2.7% to 3%,’ Phyllis said.

“A sign hanging by the instruments inside the shop reminds customers there is another way to pay: a local currency called BerkShares. It can help business owners like the Webbs avoid the fees that accompany credit card transactions.

” ‘Those dollars through Visa, MasterCard, Discover, do nothing for our community,’ Phyllis said. ‘They just whisk away into the atmosphere to some other place that couldn’t care less about the Berkshires.’

“To keep more money in the region, the Webbs and hundreds of other business owners have joined this experiment in local currency. People in the Berkshires can exchange U.S. dollars for BerkShares, for free, at any of nine participating bank branches. The exchange rate is one dollar for one BerkShare.

“As of March, it’s also possible to transfer funds from almost any bank straight into the BerkShares app, which acts like a digital wallet. There is one catch: Transfers can take up to six business days.

“When a customer uses digital or paper BerkShares instead of a credit card, business owners don’t pay any transaction fees. There’s also an incentive to keep BerkShares circulating in the local economy instead of converting them back to dollars. Converting from BerkShares to USD involves a 1.5% fee, which is about half of a typical credit card fee.

“Members of the Schumacher Center for New Economics, a nonprofit in Great Barrington, came up with the idea for a Berkshires currency more than 15 years ago. Since then, more than 350 businesses have signed on to accept paper BerkShares, and about 70 also are using the new digital version. …

“The goal of a local currency like BerkShares comes from a basic economic idea: When more money stays in a community, it increases revenue for local businesses over time, and allows those businesses to grow.

“Leah Barber, a volunteer board member with the BerkShares program, likes the convenience of using the new digital BerkShares app. However, she still keeps a wad of the blue and green bills in her purse. …

” ‘If I whip out my BerkShares, it makes you think, “Oh, maybe I should be paying in BerkShares too,” ‘ Barber said. …

“Hayley Ranolde, a customer service manager at the Berkshire Food Co-op in Great Barrrington, said she typically sees no more than a handful of people paying with digital BerkShares each day. The co-op is one of the early adopters of the new digital currency. For those transactions, Ranolde uses a cell phone with the BerkShares app since the cash registers don’t accept that type of currency. …

“If more people used BerkShares, especially local vendors, Ranolde said it would be a game changer. The store would be able to keep more BerkShares circulating without having to convert them back into dollars.

“Though BerkShares have been around for more than a decade, the currency hasn’t achieved widespread adoption. … BerkShares advocates have high hopes the new digital currency will reach more people. …

” ‘I think that the digital way is the way of the world,’ said Phyllis Webb. ‘We’re excited to be part of of a first opportunity to see how this works with a local currency.’ “

If your community had a system like this, would you use it? Or would it feel like one thing too many to remember when you’re rushing to finish errands?

More at WBUR, here.

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When dollar bills of any denomination get too beat up to use, the federal government shreds them. For a long time, the various Federal Reserve banks gave out small bags of shredded money to visitors as a souvenir — always a big hit with kids.

But for the last few years, shredded money has been used as compost in gardens. Here’s a story from Seth Archer at Business Insider about the new approach.

“Have you ever wondered what happened to currency that gets damaged? If you have a paper shredder in your home, you already have a pretty good idea. But that’s just the start….

“The New Orleans branch of the Federal Reserve shreds $6 million in cash each day. They mainly shred bills that are dirty, taped, graffitied or otherwise unfit to be used as cash.

“The bills are shredded to a fine texture to make compost. … The cash is transferred to a compost facility, where it is mixed with other materials to make nutritious plant food.

“After the compost is made, it is sold to local farmers, who use it to grow peppers, tomatoes and cucumbers.

” ‘It is very fulfilling to be growing using a material that would otherwise go to waste.’ — Simond Menasche, founder and director of Grown On.”

More here.

Photo: Great Big Story

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bitcoin-machine-at-South-StationA friend is doing research on bitcoin and other virtual currencies.

Although it sounds like phoney money to me, I still honor the lesson I got in fourth grade about how a dollar represents trust. You trust when you receive it that it will be accepted by someone else in exchange for something you want. You trust the entity that backs it. Today people are using virtual currencies like real money, so trust is working so far.

But does it all remind you of the company that used to accept your money and promise to do your worrying for you? Or how about virtual gift giving, which enjoyed a flurry of attention in the media a while back. (The gift company will e-mail your friend that you “bought” a virtual gift. The concept is based on the premise that it’s the thought that counts. VirtualGifts4U.com, for one, just asks you to support its sponsors.)

I took this picture at Boston’s South Station, where, during specified hours, a friendly young man will explain how you can buy bitcoins at this machine. I haven’t chatted with him, so I don’t know if he also explains that the value of your bitcoins can not only go up in an hour or two but go way down.

There is no significance to the fact that the machine is located right next to an endlessly running “If you see something, say something” security video.

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A new $100 bill is in the works. For security, it will have half a million tiny lenses in a special strip, and the lenses will create a particular optical effect as you tip the bill this way and that.  Kind of like a hologram, is my understanding. There will be even more tiny lenses on the Liberty Bell and the numeral 100, and as you tip the bill, the one will turn into the other, thanks to the lenses.

This rather surprising information I learned from a speaker today — Doug Crane, vice president of the family company that has been making America’s currency and some other nations’ currencies since 1801. He makes paper only from cotton (80%) and linen (20%).

There are a lot of interesting old documents about the history of Crane & Co. — and how it overlapped with key events and players in American history — at this blog on WordPress.

More information is on the regular website of the company, which is based in Dalton, Massachusetts, and employs 850 people locally. Among them are the people who make print so tiny you could “print the Bible twice on a dime.” They also employ optical engineers who create the micro lenses and are responsible for Crane’s 80 patents.

Other employees work in Tumba, Sweden, ever since Sweden asked Crane to take over its currency making. At the Tumba site, Crane makes currencies for additional countries.

A paper-making enterprise requires a lot of energy, so Crane is working with numerous alternatives as it moves toward its goal of 100% sustainability. It has   already drastically cut its oil use in a partnership with a steam-producing landfill enterprise. Hydroelectric is proving trickier because there are so many jurisdictions on the Housatonic River to give permission to remove waterfalls.

Perhaps the river could become a Blueway and get everyone working together. (See yesterday’s post.)

Postcard from cranesbond.com

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