“It’s a slow day in the small town of Pumphandle and the streets are deserted. Times are tough, everybody is in debt, and everybody is living on credit.
A tourist visiting the area drives through town, stops at the motel, and lays a $100 bill on the desk saying he wants to inspect the rooms upstairs to pick one for the night. As soon as he walks upstairs, the motel owner grabs the bill and runs next door to pay his debt to the butcher.
The butcher takes the $100 and runs down the street to retire his debt to the pig farmer.
The pig farmer takes the $100 and heads off to pay his bill to his supplier, the Co-op.
The guy at the Co-op takes the $100 and runs to pay his debt to the local prostitute, who has also been facing hard times and has had to offer “services” on credit.
The hooker rushes to the hotel and pays off a room bill with the hotel owner.
The hotel proprietor then places the $100 back on the counter so the traveler will not suspect anything. At that moment the traveler comes down the stairs, states that the rooms are not satisfactory, picks up the $100 bill and leaves.
No one produced anything. No one earned anything. However, the whole town now thinks that they are out of debt and there is a false atmosphere of optimism and glee.”
This amusing anecdote, circulated around the internet, illustrates the effects of a stimulus package. Apparently the first iteration appeared during the Great Depression, when local stamp script currencies were created to address the crisis. In the earlier version, the kicker is when the salesman who deposited the $100.00 note on the desk picks it up and lights his cigar with it.
“Counterfeit,” he said, “A fake gift from a crazy friend.”
So what is money? What makes it real? Or perhaps more important, what makes it legal?
Despite its paramount role in our lives, ordinary people and experts alike seldom question or think about what money really is, which suggests that a deep collective blindness is at work.
Taken from: Rethinking Money by Bernard Lietaer and Jacqui Dunne
