How To Use Our Monetary System in a Biblical Way

Here’s a thought to ponder.

Let’s think of a community of families that each agree to put aside a minimum of $100 CASH a
month. They agree that this cash will henceforth ONLY be spent within the community – and
physical cash will be the only currency accepted. Any purchases not made in the community will
be made with other resources.

There would be no “central bank” within the community. There would be no central figure to
“trust”. The only requirement is a verbal agreement to use that money within the community by
buying and selling with other members, or investing in a member’s business idea as a
stakeholder. Investments would not earn any interest, but investors would reap the rewards of a
percentage of possible profits.

Sound crazy? Why would this be a good idea? Let me provide an example:

Let’s say that we have 50 families that agree to form a “community”, which each family
agreeing to put a minimum of $100/month into the community. How would they do this? Who
would they give the money to? They wouldn’t give the money to anybody. Each family would
just set it aside, with the purpose of not spending the money for ANY purpose outside of the
community.

Let’s say that I wanted to buy a lawn tractor from “Bob”, and Bob is in the community. Great!
Bob would get money from me and I would get a lawn tractor. However, Bob would still keep
that money in the community. He might pay “Jeff” some money to resurface his driveway.
Fantastic! Jeff gets paid, and Bob gets a resurfaced driveway. As you guessed, Jeff keeps the
money he makes inside the community.

Our sample community would have minimum assets of 50 families x $100 = $5,000/month
contributed into it. This would equate to a minimum of $60,000/year. After 10 years, the
community would have a minimum of $600,000. Why do I keep saying “minimum”? Because it
really doesn’t matter how much a particular family sets aside for sole use in the community. The
minimum should just be some amount that encourages families to save that amount each month
and/or use it for trade within the community. What if somebody got laid off from their job? Do
they get kicked out of the community? No. But they should try to not spend any “community”
money they might have for items outside the community.

What purpose does all of this have? I believe it’s a way to take our current monetary system and
use it in a biblical way. The money circulating in the community would not have usury attached
to it. Also, the money would not have any ability to be leveraged into “new money” like the
fractional reserve system practices. There would be no concept of “debt” with community
money, since no loans are ever given out. There is the ability to participate as shareholders for a
business idea that community members might invest in – but there is no obligation to do so. The
assets of the community would grow every month, as that money can be used to God’s glory.
Here’s another great byproduct of creating a community. There is no bank involved. There are
no fees, overdrafts, etc.

Community money would never enter America’s banking system. This means that banks would
have less opportunity to create new debt slaves. Our example above shows minimum community
assets of $5,000/month. This takes away the banking system’s ability to create $50,000 of loans
to debt slaves – EVERY MONTH. After a year, the community would have a minimum of
$60,000 circulating within it. The banks would lose out on the ability to create $600,000 of loans
to debt slaves. Is that a great ministry opportunity or what?

Would there be taxes due to Caesar on community transactions? Possibly. Any taxes would need
to be paid from money outside of the community, so as to not pollute the community money.

Let’s pretend that we’re going to build a new economy. What are our parameters so that we all
don’t end up in prison for violating some law or other?

1. Federal Reserve Notes are the “de facto” standard for our nation’s money supply. They
are “fiat” currency, where “fiat” is Latin for “Let it be done”. It was done, so here we are.
2. Our government (Caesar) wants to be fed. Our new economy won’t be feeding Caesar
from “new economy” dollars – which is why we still keep enough “old economy” money
on hand to pay the government its demands.
3. Our new economy must be formed in a way that removes all methods of the “new
economy” currency from being used to create debt slaves. This means no interaction with
credit cards or banks. If those entities are desired, then “old economy” money would be
used to interact with them.

That’s it. Those are the basic rules for this new economy to work. Now you’re probably asking:
“what does this really get us?”

Let me explain it this way. Our current economy (hereafter referred to as the “old economy”) is
completely based on debt – which initially began with the Federal government printing IOU’s,
from which Federal Reserve Notes (more debt) were created.

Here’s an example: The Federal government prints $1,000 of new Treasury securities (IOU’s).
Some Primary Dealer (big bank) buys this $1,000 of debt at a Treasury auction. The Fed then
might buy this $1,000 of debt from the Primary Dealer in order to create new money for the “old
economy”. This $1,000 would sit as an asset on the Fed’s balance sheet. The Fed would then
have the Bureau of Engraving and Printing (BEP) print up $1,000 of Federal Reserve Notes
(FRN’s – our currency). The Fed would then have these FRN’s sitting as a liability on its balance
sheet. There would be $0 of capital on the balance sheet. What does this tell us? It tells us that
FRN’s are initially created as debt. They are debt instruments with an immediate maturity that
might pay NEGATIVE interest (in the case of inflation). Holders of this debt can go to any bank
in the United States and demand payment for that debt. Of course, the bank will oblige, but
“payment” consists of paying you in yet more debt. You might take a $20 bill to the bank and
demand payment. The bank teller might give you a $10 and two $5’s to make good on your
demand. In the “old economy”, FRN’s (debt) are redeemable by more debt (FRN’s). We all
become debt slaves.

Now you might have read this and said: “It’s so depressing! I wish we could just go back to the
time when everything was backed by gold”.

Guess what? We can…..sort of.

What makes gold/silver have value?

1. God says in His Word that it has value – that’s good enough for me.
2. It takes work to get gold/silver out of the mine. It doesn’t just grow on trees.

What are some of the drawbacks to using gold/silver as currency?

1. It’s heavy compared to carrying around pieces of paper.

2. It’s difficult to divide when you want to buy something for a particular price.

What if we could have a “new economy” where the currency “acted” like gold, but it was still
based on Federal Reserve Notes?

“. How can you have an economy that acts like it’s based on gold and still use debt-based
currency?”

It’s really pretty simple. An economy based on gold has the condition that the gold exists prior to
the currency being created. In other words, any new currency has to be “backed” by existing
gold/silver.

Here’s an example:

The Federal government exerts effort and mines $1,000 of gold. It then creates $1,000 of money
based on that gold. How does their balance sheet look? They would have assets of $1,000 of
gold. There would be $0 of liabilities, and there would be $1,000 of capital (“profit”).

Notice how an economy based on gold is “capital-based” and not “liability-based” like our
current economy? You could also say that a gold-based economy is “profit-based”.

That all well and good, but how can our new economy function the same way while still using
Federal Reserve Notes?

Answer: We need to operate in two economies, the “old economy” and the “new economy”. The
world is going to continue functioning in the “old economy”. Most all of us will still get paid
from “old economy” dollars. Quite a number of us will still have an “old economy” mortgage on
our house. This “old economy” is actually what will enable us to create our “new economy”
using Federal Reserve Notes – and have it function just like a gold-based economy for the most
part.
The way to do this is to base the creation on all “new economy” currency on the existence of
“old economy” FRN’s that were attained through work – just like gold is by mining it.

Let’s see how this works.

Our new economy will begin with $0. I take $100 (or any amount) that I have received in the
“old economy” and put it aside to only be used in the “new economy”. What does the “new
economy” balance now look like?

The “new economy” balance sheet has assets of $100 (in the form of Federal Reserve Notes),
liabilities of $0, and capital of $100 (consisting of FRN’s).

I now have a “new economy” up and running. It has turned “debt-based” currency from the “old
economy” into “capital-based” currency in the “new economy”. It is now functioning just like
gold (as long as FRN’s continue to exist).

Now you’re probably saying: “OK. You took a $100 bill – set it on your dining room table – and
called it the creation of a new economy! What’s your point?”

The point is that I have made the determination that the $100 sitting in front of me will never
again see the inside of a bank. It will never again be used to create debt slaves. It will be used as
“capital-based” currency used to God’s glory.

I think I know what’s coming next…..”Brad! Your new economy is just you! You have nobody
to do trade with! It will be like burying your $100 in the ground – and we ALL know the parable
of the lazy servant. He should have AT LEAST put his money in the bank to earn interest!”

First off, the master was not really encouraging the servant to put money in a bank to earn
interest. The Bible is replete with warnings to never do that. The master was simply telling the
servant “you’ve already shown me that you’re lazy and slothful – so you might as well have
continued to disobey by giving my money to the money-lenders for interest.” Nowhere in
scripture is money-lending at interest considered to be even a remotely good thing.

Who said that my “new economy” can’t function quite well within my family? Why can’t I use
the assets of the “new economy” to build a business – as long as the assets never see the inside of
a bank? How can I accomplish this? How about hiring my son to work for me? I pay him with
“new economy” money and it never goes to the bank.

What about taxes, and other Caesar-related charges? Those must be paid from assets that are still
sitting in the “old economy” – since to do any less would be to violate the constraint that “new
economy” money never sees the inside of a bank.

Would our new economy be thriving at this point? No. But what if ten other families caught the
“new economy” vision? What if it was 100? 1,000? 100,000?
Would all “new economy” transactions have to occur within a local geographic community? No.
People would be free to transact with anyone, anywhere, that had the “new economy” vision.

Here are some points to ponder:

1. The new economy currency would act as a credit-based currency. Therefore, the new
economy – by definition – could never drop into a debt-based economy. The worst that it
could do would be to hit $0 – where nobody has any money that they have set aside for
the new economy (a practical impossibility as long as one person still has the vision).
2. Every dollar in the “new economy” will be stopping the banks from creating up to $10
worth of debt slaves. What if the new economy went nationwide and had assets of $10
million? (One could never measure this, since each family decides what assets they want
to participate with – and they can change their mind at any time). This means that banks
would no longer have the ability to create upwards of $100 million of debt slaves. What a
blessing!

One last question that would probably arise: “Could new economy money be used to loan out to
a brother?” The answer is yes, providing biblical standards are kept. These are:

1. No usury (interest) is allowed.

2. Jubilee years should be observed.

Given these constraints, any loans would most likely be of fairly small amounts. Some people
might say that the lender is due some interest because of inflation. Inflation would only exist in
the new economy where purchased goods where initially bought from the old economy. I would
tend to add a constraint to the new economy that all loans must be usury free. This would keep
things as clean as possible, and make sure that the loans were initially given with the correct
biblical perspective.

That’s it! Let me know what all of you think…

Here are some excellent comments that I’ve already received – and my responses to them (in
red):

“Seriously, though, it sounds like a great idea and how tribes were originally formed for
centuries. However, I’m not sure how you could practically get back to that….even if the
“community” were the entire United States (which basically is what we have now), there is
too much easy money to be made by going outside of the community. Also, human nature is
greedy and the community or someone in it will eventually see someone or something
outside of the community that he/she desires and will find a way to go around the rules or
create new rules to get what it/he/she desires. Now, if you are going to start this with a
group of believers, that’s an entirely different discussion!”

Yes, the idea is targeted at believers.

Also, there’s really no penalty for going “outside the community”, since there is no leveraged
money, so the community assets would just shrink by a small amount. There’s really no “gain” to
be had by not using the community. In fact, there would probably be better deals within the
community, since members would have a smaller group to “sell” to, thus encouraging them to
keep their prices in line.

If people truly understood the concept that the communities assets always keep growing, even as
the size of the community remains stable, then they would see the huge economic benefit to such
a plan. Asian communities have been (and still are) doing this. That’s why we see huge areas of
Los Angeles being developed by the Koreans. They keep their Federal Reserve Notes within
their community.

I like your thinking. A couple of things come to mind. First what happens when there is
more money than is needed within the community? If only 10 widgets are needed but there
is 10 times that amount in cash, then the families are weighted with having extra
“unusable” money while they may have a need for non-community items, unless there is
some kind of adjustment made to keep things balanced. Also what would the extra cash be
used for that isn’t currently being used? For example why not eliminate an accumulating
number ($100 per month) and instead people just decide to keep some amount of cash on
hand for what they think they’ll need. And on the same token, if someone has a big windfall
inside the community but is struggling with business outside the community, they are
supposed to not spend their “inside” cash when there isn’t enough goods/services to cover
their basic living needs. Second how do you tell people that if something costs $105.59, that
they are supposed to take $7.82 from their outside money to cover sales tax, and $97.77
from their inside money to cover the cost of the item. It sounds complicated.

It sounds like it would work when things went well with “inside” trading, but would soon
fall apart when people didn’t feel like they could get the things they need. There are many
families that are having a hard enough time covering their monthly expenses and don’t
have much if at all to set money aside.

Wouldn’t it be more effective if people just stopped using credit/debit cards altogether and
just used cash? You would have the same effect without the limitations.

Any money in the community that is just “sitting” there is money that is not being used wisely.
That is where community members should prayerfully considered investing in business ideas that
they themselves have, or that other community members have. There are always uses for money.
It might take some brainstorming – but they’re there.

The minimum amount to contribute each month could be any amount – or none at all. It’s just a
way to encourage community members to participate in the community. Once they realize that
community assets always grow, while the size of the community remains relatively stable, then
they will be more encouraged to do as much business in the community as possible. This is how
Korean families operate. They keep their Federal Reserve Notes within their community, and
they have been able to take over large swaths of real estate in Los Angeles by doing so. They are
thriving economically.
If someone has a large windfall inside the community (by realizing large profits on a business
idea for example) then, yes, they should seek to keep those profits within the community –
maybe by looking at other business ideas that would further extend the kingdom of God. God
will provide for their “outside” needs – usually by community members ministering to the family
from inside the community.

The community money should not be tainted by Caesar taking his cut. The accounting is not that
hard, since the community is purely voluntary. In your example, the family might use $110 of
“community” money to pay for the item, and remember to toss $10 back into their “community”
money from outside resources at some point in time. Even if they don’t, it’s not a drastic
problem. It’s more a way of learning to use funds within the community as much as possible.

There is no set size to “begin” a community. It could begin with two families and grow from
there. People that have fallen on hard economic times could just participate as much as possible.
If they need to take money back to the “outside” then that would be fine. Eventually, the concept
of a community economy would become evident to everyone and it would grow.

If people stopped using credit cards then that would help tremendously, but it would still not
account for the millions of debt slaves that the banks create through the deposits of the citizens.
The only way to alleviate this sin is to get banks out of the equation. That is what the community
would do.

The alternative to using this community would not be to deposit the money in the banks
necessarily. But to use cash only. The idea could gain traction if people were just
encouraged to pay cash on as much of their monthly budget as possible (whether inside the
community or not), while remembering families within the church who have business
ventures of their own (which we do now for the most part).

At some point you’ll need to review the basic underlying premise with me of how $100
turns into $1000 out of thin air simply because a bank loans out 90% of what it brings in.
I’ve read your tutorial, and still don’t quite see it. My understanding earlier on was that if I
deposit $100, then the bank can loan out $1000. But that’s not what you were saying.
Anyways that’s for another time.

The main problem with using cash outside of a community has to do with the “velocity of
money”. In other words, you not depositing the money in a bank that can use it to create debt
slaves, which is a good thing. However, that $100 cash that you’re using might go to buy a
couple new tires on your car. The tire center would then take that $100 cash and deposit it into
their bank – thereby allowing the bank to use it to create debt slaves…..exactly one of the things
you were seeking to avoid. Spending cash in the normal economy has no real benefit. It still
creates the debt slaves. Spending that cash in a community would never create debt slaves – as
long as the cash stayed in the community.

This sounds very good and, yes, exclusive, if it were practiced in America. Therefore,
someone must hold the money; don’t you agree?
In a sense, the so-called health insurance co-operatives, do they not practice this, in a
sense? I’m rather out of touch, but I assume they still exist.

Indeed, to pull this off we must have a “community organizer”! Do you know of any? hehe .
..

Actually, anybody could be included that had the goal of keeping banks from creating debt
slaves. It’s not really an organization, so much as it is a means for running an honest economy.
There’s really not a way to “take advantage” of it, since it’s just the free market in play – except
outside the control of the banking system.

There is no real concept of “free-loaders” since they have nothing to gain by not participating.
There’s no “required” work. The only provision is that each family sets aside a certain amount of
money in their own safe storage with which to use in the “non-banking” economy. In fact,
money could easily be used between communities. It really doesn’t matter. It’s simply a way to
take our current “liability-based” currency and turn it into “capital-based” currency. Both of
those still fall on the same side of a balance sheet, but one is profit while the other is debt. In
other words, this would seek to create a “profit-based” economy.

There doesn’t really need to be much of a “community organizer” – since we already see what
that got us in the White House. There’s just an individual decision within a family regarding how
much they want to devote to the “non-bank” economy. It could be $5 or $5,000,000,000 – it
really doesn’t matter. The thing that matters is that those they do business with while using that
money are also committed to not depositing it into a bank. That instantly takes “profit-based”
currency and returns it back to “debt-based” currency.