The Ecumenical Movement 

 Exchanges

Exchanges are not-for-profits created to promote ethical solutions to mankind's social problems. Exchanges issue charitable receipts for donations of goods and services. Exchanges promote local economics however some products can be produced overseas more cheaply than they can be made locally. This cost disparity creates risk. Exchanges do not support the automatic purchase of the cheaper option. The focus of an ethical organization is not on reducing costs for one person at the expense of the community. Exchanges need to look at the cost of an option in terms of its cost to a local community. Exchanges do not reduce costs for an individual or sub-group at the expense of the environment.

Sustainable communities find ways of restructuring the input costs so the total cost to the community is less than what they would be if each product was considered seperately in terms of their profitability. Exchanges factor in all costs associated with production. Ethical Organizations do not externalize costs onto the community. The cost of a product or service charge must reflect the pro rata cost the product or service represents to the community. The cost of maintaining the unemployed is spread across the items imported to adjust the initial cost of the import to its true cost to the community. If bringing chairs in from outside the community unemploys one member of the community the upkeep of that member is a cost added to the cost of the import.

When a business exists as a wholly owned asset of the community transactions benefit both buyer and seller and penalizes neither. There is no moral quandary or ethical dilemma for the buyers and sellers in an Exchange. Exchanges represents the common fiduciary interests of buyer and seller. The Exchange represents the common fiduciary interest of all constituents. This shared fiduciary interest makes downloading costs onto a community no longer feasible or desireable.

No community has the capacity to produce everything it needs, some goods will need to be acquired elsewhere. Some supplies will need to be accessed overseas. But if the savings experienced from purchasing externally sourced goods does not exceed the costs generated by people sitting idle the savings are from the view of an Exchange.

Full gainful local employment is the only ethical option in a communnity. Exchanges view buyers and sellers as part of the same organizational unit, they work together to keep the community at full operational capacity to maximize ROI.

Profits that accrue to individuals though the costs are distributed over the community means society is paying to produce benefits for individuals whose interests lie outside of the community. Globalism tends to benefit multinational corporations at the expense of local communities.

 Exchanges work because they are capitalized by the assets available to the community. Eliminating the need for external sources of capital also eliminates this source of risk. Self funding also eliminates the need for external risk assessments and centrally processed credit applications. Credit is provided by the community. Exchanges easily raise capital in house because the operations of an Exchange are scalable to the assets available.

For the purposes of this discussion we refer to this currency as rollars. Elsewhere we have used other expressions. Rollars are an accounting device. Currency is used to track purchases and sales. Rollars are created and issued on the basis of assets donated. Currency serves as a device for tracking internal economic activity. (Rollars is a term derived from rational dollars).

Businesses are an integral part of any community but so are consumers and workers. Business risk is equitized by Exchanges to contain all risk within the product stream. Corporations buy up-stream and down-stream businesses to reduce their exposure to supply and demand disruptions and to bring distribution and supply costs in-house. This same process is used to eliminate exposure to risk by Exchanges. When the entire range of risks to which an individual can be exposed is contained within the economic and political network within which he operates the risk is eliminated.

Exchanges produce sustainable communities with markets focused on local sourced goods and services. Inputs of one sector are the outputs of another. Waste is eliminated because waste is contained within the community. Risk is brought 'in-house'.

No external sourced money is needed so businesses are not impacted by currency or credit shortages.

Credit is limited only by the members willingness to devote assets to a given purpose. Money as equity is a shared resource owned and controlled by the community. It is impossible for a Charitable Exchange to lose money, go bankrupt, or experience an uncovered loss. Th economic events experienced by the Exchange are all contained within the organization. 

 

Exchanges   Scenario One

Tom wishes to sell his car. Exchanges eliminate the need to go online, advertise or post 'For Sale' signs or suffer a loss by selling his car to a dealer. Selling a car using free market methods can be a costly and time consuming and sometimes fruitless process. Exchanges are a charity that turns unwanted assets into charitable donations. Donations become part of the equity in the Exchange. Items difficult to liquidate using free markets methods are easily disposed of. Benefactors receive charitable receipts equal to the value of the donation.

The risk associated with ownership is transferred to the charity. Exchanges neutralize any risk faced by buyer or seller. Liability is turned into equity. The liability of ownership is turned into equity in the Exchange.  Thus risk is turned into security.

The Exchange provides Tom with equity equal to the value of the car or a portion thereof as determined by the Exchange. Thus Tom is given immediate liquidity and the car becomes part of the asset pool of the Exchange.

Sue buys the car from the Exchange. Sue owes the Exchange the value of the car but this is a debit balance and does not represent risk to the Exchange or any member. The cost of the car is a debit added to Sues account with the Exchange.

The Exchange just balances the credit available to Tom with the debit added to Sue's account. Sues debit is balanced by Tom's credit. Tom's credit is typologically the same as Sue's debit. It is inaccurate to see credits and debts as debt and loan in the way the free market records these things. A closer approximation would be a desk transferred from one department to another with the transfer tracked as a transfer of equity without the business itself suffering any gain or loss.

The Exchange is charitable organization. All its supporters have a voting and equity interest. The Exchange consists of members who exchange assets as credits and debits.  Sue as a shareholder accepts the car by transfering assets within the Exchange. Tom is given $2000.00 equity represented by a credit of δ2000.00 towards his account. Sue's account is given a debit of δ2000.00 to represent her acquisition.

The Exchange is composed of Sues and Tom's transactions. It also contains all those people who know and do business with Sue and Tom. Someone needs what Sue has or can do. Tom always needs the good and services provided by others in the Exchange. The Exchange facilitates the transfer of assets from one supporter to another. Sue is always able to earn rollars in the Exchange and she can always obtain equity in the Exchange and Tom always finds someone to who he can transfer his credits in exchange for goods and services. The Exchange serves as a closed market.

The car may be photographed and a detailed description prepared and offered on line or through a car lot if available or desired. Car dealerships may have an account in the Exchange.

Exchanges can use all social media including email and other online services as a service to members.

Items can be given a set price or sold as an auction item on line. If auctioned members bid on the item for an allotted period of time at which time the item is sold to the highest bidder. EBay can be used for this purpose or an alternative site including the online facilities of Rational Exchange.

The Exchange pays its expenses using rollars. It hires only clients of the Exchange and so far as is feasible clients buy goods and services only from each other.

If a car lot is used to sell a car the lot should be owned by a Shareholder so that the costs of selling the car can be covered by a transfer of assets. Credits purchase goods and services. Exchanges serve as a closed economy in which inputs and outputs are always in balance.

Shares (also called rollars) serve as a local currency.

The Exchange by  turning Tom's car into equity (shares in the Exchange) allows Tom to acquire other goods and services available from the Exchange. This is why economic development occurs spontaneously in an Exchange.

Risk always remains within the Exchange. Credits and debits are always in balance and accounts always total zero.

Assets possessed by the Exchange listed for sale and paid for in rollars, serve as the Capital of the Exchange.

Assets listed for sale on behalf of members are the assets that back the rollars issue. This is called the equitization of debt. The value owed the seller is retired as equity in the Exchange and paid out in rollars which are backed by or are composed of shares in the Exchange.

Exchanges are owned by and governed by shareholders. Each member owns one voting share or Common Share. 

Credit can also be provided to new participants upon joining, as determined by Shareholders. This and all other policy is determined by Shareholders during General Meetings.

Before purchasing goods and services buyers must acquire rollars. These can be purchased using fiat currency from the local Exchange or by listing items on the Exchange, or by being advanced rollars by the Exchange.

Upon listing items for sale the seller may be given credit up to the value of the goods offered or an agreed percentage.

It may be a condition of the Exchange that the buyer sell goods and services equal to the amount spent before taking possession of purchased items or alternatively posting a bond in the form of cash.

Members determine specific policy for the Exchange according to the principle of one member one vote.

When an offer is received the seller is notified. If a visual inspection is required contact information is posted and the buyer can contact the seller and arrange for a viewing.

Services are offered in blocks of time or as a service call. When the good or service sells the seller receives rollars or equity in the Exchange equal to the amount of the sale. The buyer can pay cash (to the Exchange) or have their account debited in rollars.

Items may be sold conditional upon the buyer raising the required funds. If the buyer pays cash the cash is exchanged for rollars (rational dollars) the unit of account for the Exchange.

Sellers are always paid in rollars and rollars must be used in purchasing goods and services. In other words rollars are the currency of the Exchange and must be used for internal transfers or assets. In other words assets must be turned into equity in the Exchange. Assets are not traded directly nor for cash (which is a form of asset).

Rollars represent non-voting shares in an Exchange and are unlike many alternative currencies) fully backed and secured by the assets of the Exchange. 1000 rollars represents $1000 worth of assets owned by the Exchange.

All exchanges are transacted in rollars.

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