[just rejoined after a period of absence, sorry if this has been covered before, but Russ' post looked like a thread-starter so I thought I'd jump in.] Russell Nelson writes:
I wonder how well a zero-balance money supply would work (having positive and negative money)? Positive and negative money is created simultaneously by a single transfer of wealth.
Some friends of ours tried starting up a regional group of a system called LETS, which works on this principle. The group members traded `spots' for services or items - in this case generally stuff like gardening/handyman work, computer programming, whatever their skills were. The spots were tallied in each member's account with a community `bank'. The key to the whole thing was that there is no value in the currency itself, only in the *exchange*. It never really got far enough off the ground to become self sustaining, due to lack of interest or general apathy, but was an interesting idea. Apparently there are a number of communities in the US with this kind of system established, as well as other kinds of barter economies.
I also think it would be impossible to run such a currency anonymously, because a negative balance is essentially a loan, and how could you loan money to someone who could be anyone? Only if they had established a reputation with their public key...
One of the interesting features of such an alternative economy, especially when when it operates side-by-side with a traditional one where debtors could leave the system, is that there is a strong community incentive to prevent anyone building up either too large a debt or too great wealth. In both cases such a person becomes a risk and a burden. But there is never any problem of someone keeping money out of circulation, or being short of small change. In the LETS system I mentioned above, everyone's current balance and trading volume were published in a newsletter. That way, community members were encouraged to keep their balances, and those of their trading partners, near zero.
Hmmm... Interesting, then. You could only effectively work anonymously if you had created a reputation for your anonym. And that reputation would have to be established in some way *before* anyone would loan you money, otherwise such a loan would end up being a gift.
This is the same situation as now. However, consider that you don't actually *need* anyone to lend you money -- you can make as much as you like yourself by contributing to the community, or borrow some from the community at any time.
One way to establish such a reputation would be to write some free software, or answer Usenet questions, or were otherwise seen to be knowledgable and responsible. I haven't seen anyone try it yet, though. Does anyone know of such an attempt?
Sure.. lots of people are doing those things you mention.. in fact I'm sure I've seen you do *all* of them yourself, Russ :) -- Dan.