I've created a community using Cyclos that models the toy system I showed you a week or two back. Remember that imagined a group of ten people in a community who emitted IOUs to eachother as follows.
Here's what the system looks like if you log in as the Carpenter and check out the account details after all the "payments" have been made.
You can see that the Carpenter has sent IOUs (payments shown as negative numbers in red) to the Teacher (€12), the Hairdresser (€15), the Cleaner (€10) and the Baker (€5). But he has recieved IOUs from the Gardener (€12), the Electrician (€10) and the Builder ($15), leaving him with a net balance of -€5. You can also see that the available balance stands at €9,995 - simply because I was pretty generous when I set the system up - I decided arbitrarilly to let people run up cumulated IOUs of up to €10000. But of course, that is up to the administrator of the system. And it would be easy to start users off with a small value (say €100) until they have proved that they are reliable.
There is a similar picture if I log in as any of the names.
As administrator for the system, I can look at the overall balances for each of the ten users. Here's what it looks like.
You can see that the numbers all tally up. They all correspond to the "Net" values in my original illustration. And the net balance across the system is exactly €0. Indeed, it can't be otherwise. The only thing that users can do is send IOUs to other users. Even as the adminstrator for the system, I am unable to generate a transfer between users. So the whole thing is perfectly safe.
I was thinking that it would be nice to implement the fancy graph analysis mechanism to eliminate the loops in the system. But the fact is that you don't even need that. The only thing that users need to know is whether they are seriously imblanced or not. And from the point of view of the administrator, the only thing that would be necessary would be to just warn people who have become seriously negative for a long time that they need to do something about it, or risk being labelled as a bad player.
But even if someone ends up owing the Baker too much because they have been going an getting their bread every day without paying off the tab, there's no real problem. The Baker would just have to say - OK, this time you will have to pay off the debt with some "real" euros - either by cash, by cheque or by credit card. When the debt was paid off, the Baker would simply send a "payment" via the Owe'm system to acknowledge that the IOU had been cancelled.
Simple. In this way, the entire community could function with goods and services charged for in Euros, but without actually needing any "real" euros at all! No need to borrow "money" from a Bank. And no need to pay any Bankers interest for letting use their "money" that they create out of thin air anyway.
I seriously think that this way of conducting business could make conventional banks almost irrelevant. We don't need their "money", because we can create our own in the form of IOUs using the Owe'm system.
STOP Press. I've just made the system public and you can log in at www.owem.net. You'll need to registrer by providing an email address so that the Cyclos 4 software can send you an activation code. After that, if there are two or more of you out there, you can owe each other as much as you want. And if you want to try owing somebody some money, you can try sending an IOU to one of my characters - the Baker, the Builder, the Carpenter etc. Don't worry, I can get them to send you back an IOU to cancel it out, so you won't actually lose anything on the deal!