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economic principles. Since then, a substantial proportion of the JAK membership comes from the Arab world. From a legal point of view, the JAK system is possible in Sweden because a registered association is allowed to keep and administer deposits and transactions.

ADVANTAGES AND DISADVANTAGES OF ALTERNATIVE MONEY AND CREDIT SYSTEMS Exchange rings, barter clubs, and savings and loan associations are embryos of a new economy because they offer advantages to their members, otherwise no one would use them. Goods and services worth US $2 billion are bartered yearly in the U.S.A. Taking into account the growing number of transactions, based on barter, between Eastern and Western Europe, as well as industrialized and developing countries, it is estimated that between 10 to 30% of the world trade is barter trade. Everywhere barter trade allows an additional volume of trade which would not be possible within the normal monetary system. The basic features of all exchange or barter systems are very similar: Members hold an account in a central office. - Accounts are held in fictive clearing units (green dollars, WIR, etc.) and their value is identical to the national currency. An overdraft up to a particular limit is allowed, and members with positive balance become de facto lenders. Positive credit balances receive no interest, loans are interestfree, or (compared to market interest) carry very low interest. Cash deposits are sometimes allowed, and cash withdrawals are basically not allowed, or are limited. Members inform the central office about all transactions by telephone, in writing, or through electronic mail. The central office administers all settlements. The central office is paid by either yearly contributions and/or a fee per transaction by buyer and/ or seller. The participants determine the price of the clearing unit themselves. The central office can demand a reserve to cover a loan against losses, and for cases of misuse. The central office is responsible for coordinating and informing members of credit and lending needs. Needless to say, barter and exchange systems, specializing at a local, national or international level, have benefited greatly from the new information technology. The notion of a free exchange of goods and services as envisaged by Gesell and Proudhon, is now much easier to implement where information travels fast to any place in the world. It is important to understand that barter clubs reverse today's banking principles. They reward those who exchange goods and services with interest free money and punish those who sit on their surplus money. It does not pay to keep green dollars or WIR sitting on an account, since there is no interest to be gained. If the group who uses the barter system is closely representative of the total market, then this economic microcosm will function well. An economy which would consist

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Margit Kennedy (!) - Interest and Inflation Free Money  

Copyright 1995 by Margrit Kennedy) (Published by Seva International; ISBN 0-9643025-0-0; 1 2 LIST OF FIGURES:..................................

Margit Kennedy (!) - Interest and Inflation Free Money  

Copyright 1995 by Margrit Kennedy) (Published by Seva International; ISBN 0-9643025-0-0; 1 2 LIST OF FIGURES:..................................

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