DANCING WITH MONEY

If you want to understand the jungle, you can't be content just to sail back and forth near the
shore. You've got to get into it, no matter how strange and frightening it might seem.
C.G. Jung

Marjana Kos
MSc in Holistic Science
Schumacher College, August 2006
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TABLE OF CONTENTS:

INTRODUCTION ........................................................................................................................7

THE CALLING............................................................................................................................9

1. WHAT IS MONEY? .............................................................................................................13

Functions of Money...............................................................................................................13
Definition of Money ..............................................................................................................15

2. THE ORIGIN OF MONEY...................................................................................................16

Gift Exchange ............................................................................................................16
A Short Journey through the History of Money....................................................................17
Commodities as Money.....................................................................................................17
Coinage ..............................................................................................................................19
Gresham’s law ...........................................................................................................19
Banking Services ...............................................................................................................20
Paper Money......................................................................................................................21
Silver and Gold Standard...................................................................................................21
Bretton Woods Agreement ................................................................................................22
The Nixon Shock .......................................................................................................23
Floating Exchange Rates ...................................................................................................23
Intangible Money...............................................................................................................24
The Future..........................................................................................................................24
Proactive Money........................................................................................................25

3. MONEY TODAY..................................................................................................................26
Money Creation.....................................................................................................................26
Money Alchemy ........................................................................................................26
Let’s pretend you are a banker… .......................................................................................27
The Case of Properties Market ..........................................................................................29
Mortgage ....................................................................................................................29
Interest Rates .........................................................................................................................30
The hangover after too much punch ..........................................................................30
Effects of Interest...............................................................................................................31
Unnatural Growth ......................................................................................................32
Misconceptions about Interest ...........................................................................................33
Inflation..............................................................................................................................35
Characteristics of our Conventional Money ..........................................................................35

4. THE CONSEQUENCES .......................................................................................................37

Personal Sphere .................................................................................................................37
Scarcity Mentality......................................................................................................38
Economic Activity.............................................................................................................39

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 Society ...............................................................................................................................39
Nature ................................................................................................................................40
Global Economy ................................................................................................................41
Who owes whom?......................................................................................................41
Systemic Problem ..............................................................................................................42
The Future..........................................................................................................................43

5. MONEY AND SOUL............................................................................................................44

Limitless Possibilities ................................................................................................44
Money Complexes .................................................................................................................46
Money and Fear .................................................................................................................46
Money and Greed ..............................................................................................................46
Money and Anger ..............................................................................................................46
Money and Pride ................................................................................................................47
Money and Loss.................................................................................................................47
Money Wounds of the Wealthy.........................................................................................47
Money and Survival...............................................................................................................48
The Biology of Need .........................................................................................................48
The Psychology of Need....................................................................................................48
Sense of Identity ................................................................................................................49
Identity and Money............................................................................................................49
Relative Deprivation..........................................................................................................50
Psychological Pressure ......................................................................................................50
Scarcity Mentality ..................................................................................................................51
The World of the Hungry Ghosts ..............................................................................51
Sufficiency.............................................................................................................................52
The Power of Conversation .......................................................................................53
How deep does it go?.........................................................................................................54

6. INTEGRAL PERSPECTIVE ON MONEY ..........................................................................55

Knowledge about Money.......................................................................................................56
The Feelgood Factor ..................................................................................................57
Mutual Causality................................................................................................................58
Unconscious Automatic Pilot............................................................................................58
Going Upstream.....................................................................................................................59
Yang and Yin Money.............................................................................................................60
Yin and Yang.............................................................................................................61
Yin and Yang Coherence ...................................................................................................62
Yin and Yang Coherence ...........................................................................................63
Dual Economies.....................................................................................................................63
Matriarchal or Matrifocal?.........................................................................................64
Demurrage vs. Interest .......................................................................................................64
Emergency Currencies ...........................................................................................................65
Money as Symbol......................................................................................................66

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7. ARCHETYPAL PSYCHOLOGY .........................................................................................67
Quaternio Model....................................................................................................................68
Money and Spiritual Warrior.....................................................................................69
Apollo and Dionysius ................................................................................................71
Archetypes and the Ways of Knowing ..............................................................................72
Jung’s Functions ........................................................................................................73
The Missing Archetype ..........................................................................................................74
Money and Nature .....................................................................................................74
Adam Smith’s Economics .........................................................................................75
The Archetypal Human..........................................................................................................76
Sign o’ the Times .......................................................................................................78
Balanced Economy ................................................................................................................79
Commercial vs. Humane Economic Culture.............................................................80
Complex Economy ................................................................................................................81

8. MONEY AND SPIRITUALITY...........................................................................................82

Doing the Personal Work.......................................................................................................82
Step 1. Becoming Aware .........................................................................................82
The Buddhist Path of Abundance ..............................................................................83
Meditation on Money............................................................................................................84
Breathing Money ...............................................................................................................84
Spiritual Teaching......................................................................................................85
The Golden Tornado ..................................................................................................86

CONCLUSION..........................................................................................................................89

BIBLIOGRAPHY: ....................................................................................................................91

Addendum 1: GOLD … .............................................................................................................93

Jewellery....................................................................................................................93
Gold as Symbol..........................................................................................................94
Alchemical Gold ................................................................................................................94

… AND COWRIE SHELLS .....................................................................................................95

Addendum 2: PROACTIVE MONEY .......................................................................................97

Addendum 3: MONEY TYPE TEST.......................................................................................101

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6
INTRODUCTION

This dissertation is about money.

I can see a raised eyebrow there and maybe a spark of interest. Money… and you're at
Schumacher College?

I enjoy being intriguing and provoking – I certainly hope this dissertation will provoke your
thinking a few times – so sometimes at an opening circle, when we introduce ourselves to the
people who come to the college attending a course, I would say briefly, “I’m interested in
money.” It always raises some eyebrows. More than once Anne, director of the college, invited
me in her polite English way: “Would you want to elaborate on that?”; which sounded more
like “you better explain what you mean, we can’t have people think that our MSc students are
interested in money.”

So, let me explain. I do think money is fascinating. The things it makes us do – and most of the
time we are not even aware of its magical force, of the power it has over us. We go around like
zombies, programmed by the need for money, then the need to make more money, and then we
will invest that, so that our money will work for us and we will finally be able to do what we
like and live the life we want – if we still remember what that is.

Our dance of life has become dancing with money. More precisely, for many, many people it is
dancing for money.

From the toothbrush we use in the morning to the flight we take to Greece for a holiday and
the green beans grown in Africa we buy for our Sunday lunch; none of that would be possible,
in today’s world, without money. The consequences of that are almost overwhelming. This
dance for money that we are nearly unaware of profoundly affects our lives, our relationships,
it has an alarming effect on communities and the society as well as on our mother nature,
Gaia.

I find the wild, untamed power of money fascinating. When I think of money now, after
researching and observing it for half a year, and making it the focus of my life, I deeply feel its
magic and the strange, unknown force influencing our psyche to dance in a weird, chaotic,
sometimes funny and often scary but most of the time very irrational way. The things we do in
this dance might not seem irrational within the economic system we live in but they become
painfully obvious when we look at them in a broader context of nature and society. Sometimes
it is enough to use common sense.

That is the reason I decided to study money and delve into its mysteries. I invite you onto my
little boat, in which I will take you upstream and show you some important and interesting
moments in the history of money. We will take a look at how it came into being and how the
money system is working today. I will try to catch a glimpse of how the type of money we have
is influencing behaviour of people all around the globe and what are the consequences of that,
in all spheres of our lives.

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But what I found most interesting and where my passion lies is the hidden current deep
underneath. In the later chapters I will look at money in relation to our psyche, individually
and collectively. I will present the fascinating view on money proposed by Bernard Lietaer.
Bernard has taken a broader and deeper perspective than just our individual dance with
money and tried to disentangle the patterns in people’s behaviour on a collective level. This
will take us to the field of collective psychology and archetypes.

The proposition of t his dissertation is that our behaviour around money is to a great extent
unconscious – on an individual, but even more so on the collective level. The only way to deal
with the shadows of the unconscious is to bring them into our awareness, into the conscious
realm. I will try to do that by delving into the deep waters of the mystery of money and
bringing some interesting pebbles up into the light, for all of us to see them. It might even
inspire or intrigue you to dive down there too and see for yourself if you find anything
interesting or useful.

As with a dance, if we start to observe it and notice what is going on, how our body is feeling,
where the tensions are, how we are responding to what is around us and what other people do
– or how our behaviour is influencing other people’s dance, we can learn a great deal about
ourselves. With growing awareness of our thoughts, feelings and actions, we get more power
over our own dance – our own life – and can make more conscious choices, leading us to
where we want to go, enabling us to express our highest potentials and create the world we
want to live in around us.

This study turned out to be an alchemical journey, which started long before I was even aware
of it. It started with my decision to do the course. At the very moment when I’m writing this
introduction, exactly two months before I have to hand in my 30.000 words, I feel like I’m
burning in fire.

The journey took me to deep realms of my soul, exposing some of the deepest survival fears
which turned out to be closely entangled with money. I believe these same fears can be found
deep down in almost every person’s soul and can explain a lot of what is going on in the world
today. I don’t know if my study will make any change in the world, and I am not aiming at
that, but the process is definitely transforming my microcosm.

I will start the story with my personal walk upstream, to make sense of everything that brought
me to this moment here and now and which weaves together in a beautiful and meaningful
dance of my life.

I invite you to join this dance with me. I hope I will manage to take you out of your head and
into your feelings. I hope I will manage to take myself out of my head. It might get dangerous
and scary – but it might also release the tensions in our bodies and our lives that had been
there for so long we don’t even notice them.

Let’s dance!

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 THE CALLING

“There is more in a human life than our theories of it allow. Sooner or later something seems to
call us onto a particular path. You may remember this ‘something’ as a signal moment in childhood
when an urge out of nowhere, a fascination, a peculiar turn of events struck like an annunciation:
This is what I must do, this is what I’ve got to have. This is who I am.
If not this vivid or sure, the call may have been more like gentle pushings in the stream in which
you drifted unknowingly to a particular spot on the bank. Looking back, you sense that fate had a
hand in it.”
(James Hillman; The Soul’s Code)

I was brought up as a shy little girl, almost afraid to speak out or stand out in any way. Although I
don’t remember my parents ever talking about it, I always somehow knew – or had an impression –
that we don’t have ‘too much’ money. I would be limiting myself with the things I wanted; I clearly
remember the dress I got for the last, formal dance at the end of the primary school years. It was quite a
plain grey dress, which I felt quite happy buying (I would never dare getting too excited about anything
anyway) and it wasn’t too expens ive, but when my best friend saw it, she was quite disappointed. She
was always a bit eccentric, daughter of the arts teacher, and was wearing something quite ‘out of the
box’ for that occasion as well. But I wouldn’t have felt good in anything too shiny anyway, I felt most
comfortable in a plain grey dress.

Funnily enough, as I was quite good (but of course not excellent) at mathematics, I was encouraged by
my maths teacher to apply for the best secondary school in town, the school for natural sciences. My
grades weren’t really top, but she believed I was bright and also diligent enough for that school.

My grades weren’t too good and I was struggling with some things, including English, until a day in
the third year when we were given a comprehension test, which I passed surprisingly well. Surprising
for me and for my teacher, especially as some of the better students got quite low grades. That
experience somehow shifted my attitude to the English language and provided me with more self-
confidence. As I always liked to read and by that time read almost all English books in our library, at
the end of the secondary school I quietly in my heart wished I could study English.

But the Faculty was in the capital city, some 100 miles away, and they would only accept 30 people
per year. My self-consciousness kicked in again, coupled with a feeling of money limitation if I would
study away from home. Again, I don’t remember my parents ever saying anything explicitly, but I felt
we didn’t have enough money for me to do that. They did say though that if I stayed in our hometown I
could live at home. And I could feel that was what they wanted.

So instead I applied for an easier, safer and more mainstream option, at the Faculty of Economics.
They had a vision to start a programme where all the lectures would be in English. Wow, I thought,
this would be something for me, and besides, it would provide me with a useful profession.
Incidentally, the entrance examinations were in Maths and English, two of my favourite subje cts and
also the ones I was best at.

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The Faculty I attended never, until this very day, realized the programme I wanted to do and I finished
my degree in Foreign Trade many years ago. My first thesis after two years of studying was on
Multinational Corporations, the benefits and criticism. Before completing my studies I went for a 6-
month traineeship to India. I had enough money saved by then to be able to afford that. There I made a
couple of friends that I’m still in contact with and they keep popping up in my life at crucial moments.
After my return from India I finished my studies with a thesis on economic relations between Slovenia
and India

I got a job with a small privately owned company in Slovenia as an Office Manager. There, a different
kind of learning began. I had to realize that all the things we learned at University had no use in real,
practical life at all. The only knowledge I could use was my knowledge of English and French
language and my talent for numbers. I had to start from the beginning again, learning different survival
skills. How to read my boss’ demands and wishes even before he expressed – or knew – them, so that
he would not freak out too often. How to best organise my work with all the complexities of it. How to
find some meaning in the things I was doing, some of them complete routine, others totally
unnecessary in my opinion but required by my boss…

I learned, when I communicate with people, to try to make their day a little bit brighter. I learned to get
through when troubles arise and in those times I learned most about life. I recognised my own
qualities. And in the end I learned to recognise – and to say – what was enough to take on, accept and
work with it; and when it is time to cut off and set boundaries, because the soul can not and will not
take any more.

I learned a lot in 7 years and 7 months that I spent there. More than half of that time I was thinking of
leaving, on one hand afraid to lose a relatively good job and salary – which also provided me with
independence and a stronger sense of self – and on the other somehow knowing that it is not the right
time yet.

But the time came when I knew I could not do it any more, that I learned what I needed to learn and
gave what I had to give; that if I stayed there, I would slowly die off. I did not even feel like getting
another job, in another office. My soul needed a new challenge, a new quality of growth. Slowly,
incited by a friend, I started thinking about going back to studying, to do a masters degree in England. I
started looking for a programme that would resonate with my soul, until one day a friend from Mexico,
the friend I made in India, sent me a link to Schumacher College, saying just: “My dear, you should go
study here.”

He was right, the more I was reading about the college, the more I knew this was the only programme I
would want to do. Everything about it resonated with my deepest being. But I also knew that this
would be the big challenge that my soul was hungry for. Going to a foreign country, study in another
language, live in a community where all the things you try to hide from people and from yourself get
more exposed. By the next day I had decided to apply and – by coincidence? – I had just about enough
money saved to be able to afford this one year.

At that point my story with money took an active turning and I embarked on a different route.

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How does it feel, you wonder, spending all the money one has on one thing, not knowing what will
come out of it? It felt totally liberating. Just making the decision, using my money for the thing that my
soul wanted to do, investing it in my soul’s dream (and challenge) felt fulfilling. It was like some
burden was taken off my back, a burden I was not even aware I was carrying. I did not need to use my
money sensibly any more, limit my spending because I would have to put some money aside, saving it
to provide for my future. It was gone and it freed me.

But after a couple of months, still before I even left the country, my fears already started voicing their
concerns: maybe I should split the amount and use half of the money to buy some land in Slovenia, to
have at least something provided for my future? I believe by this I touched some very primal longing
we humans have about land and owning something, having a ‘home’. I notice the same wish, the same
tendency in most of my friends and other people. We are all yearning for a plot of land with a small
house, and possibly a garden to go with it.

Coming to England felt like stepping onto a new path. It was almost like a promise of a new beginning;
I could start from the start, with a new vision. I knew that what I brought along was me. I challenged
the whole of who I was and I knew that this journey would take me to depths of my soul I did not
know, or even want to know, before. But I had trust, in myself and the path ahead of me. I wanted to
grow, I wanted to find a new, more soulful life, I wanted to find my passion, and, reluctantly, I was
aware that this will take facing my own shadow. It was time to do it.

I did find my passion – the one besides dancing, that is. It became very clear and obvious to me how
the inequalities in the world hurt me, made me angry, made me want to do something about it. I
remembered ideals that I had when I was young; ideals which I thought I had to give up because they
were just not possible in this world. Ideals about every human being being able to live a contented,
prosperous and fulfilling life. Ideals about people being able to have a job that would correspond with
their interests, with what they enjoy doing. A world where everybody could flourish, not compromise
their deepest beliefs. A world where we would be able to see other people as the richness of life and
not as a threat to ourselves. A world where we could dance our life with passion.

I also found a tool, a way of addressing these issues. I found many answers to why the world is the way
it is simply in understanding how the money system works. I don’t want to claim that this is the only
answer and the only solution – actually, I believe that the answer lies in the people; – but I do believe,
and will argue, that it is one of the initial conditions, shaping the world as we know it today.

So this is where I found my passion, this is what makes my eyes glow and what energises me. I believe
this is my calling. For over 30 years I was walking this Earth somewhat lost, looking for something,
looking for ‘my thing’. Most of the time I did not even believe it exists, or if it does, that I would
actually be able to something that I wanted, something that would make me feel alive. Now I’m not
willing to compromise so much any more. I will do what is necessary, but deep down inside is the
integrity that I’m not willing to give up. I know what matters and that’s what I will pursue.

This is the journey I’m embarking on, with no idea where it will take me, but knowing somewhere
deep inside that this is what I came here for. Bear with me on this journey. I am not a good writer and
this is for me also a practice in writing, in expressing. But I do promise one thing: I will do my best to
keep the soul permeating my writing.

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 1. WHAT IS MONEY?

Stop reading for a moment here, and think about this question. What do you have in mind
when we mention money? What is money for you; what does it represent?

Probably the first thing you thought of were banknotes and coins in your wallet. Maybe then
you remembered your credit card, with which you can also pay for things, use it in the same
way as money – but would you say that a credit card is money? Probably not. What about the
numbers, bytes of information that get transferred from your bank account to another account
when you make a payment? And all the things people used in the past, from cattle and other
animals to commodities such as salt or rice, knives and precious metals or items with no
apparent useful value; ranging from cowrie shells to huge fei stones, both on Yap island.

We soon come to a conclusion that it is difficult to say what money really is – but we would
probably quickly agree that money is about counting, measuring the value of what we are
buying, what we are exchanging in a transaction.

Although money has appeared in many material forms, money itself is not a thing. Bernard
Lietaer proposes a simple experiment that distinguishes money from any and all things:
stranded alone on a deserted island, a thing, say a knife, is still useful as a knife. However, a
million dollars in whatever form it takes – cash, gold coins, credit cards, or even knives –
ceases to be money. It becomes paper, metal, plastic, or whatever, but it no longer functions as
money. For any ‘thing’ to act as money, it requires a community to agree that the particular
object has a certain value in an exchange, he concludes. (Lietaer & Belgin, 2006)

Functions of Money
Since all sorts of things have been used as money at different times in different places it is
almost impossible to define money in terms of its physical form or properties. Definition of
money is therefore usually based on the functions it serves.

The three main functions of money are:

1. A medium of payment or exchange 1

When an object is consistently used as an intermediate object of trade and simplifies the
process of trade, it becomes a medium of exchange. That leads to direct demand for the object.
In order for a single object to become or to remain dominant in this function requires either
coercion or faith.

1
Lietaer clearly distinguishes between the ‘means of payment’ and ‘medium of exchange’; the first expression
including transactions which have ritual or customary purposes, instead of just commercial exchanges. (Lietaer,
2001)

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To be a good medium of exchange, money must be accepted by people when buying and
selling their productive resources and goods and services. It should be portable or easily
carried from place to place. It also must be divisible so that large and small transactions can be
made.

2. A unit of account / standard of measure

When the value of a good is frequently used to measure or compare the value of other goods
or when its value is used to denominate debts, it is functioning as unit of account.
To be a good standard of value or unit of account, money must be familiar, divisible, and
acceptable.

3. A store of value
When an object is purchased primarily to store value for future trade, it functions as a store of
value.
To be a good store of value, money must be durable so it can be kept for future use. It also
should have a stable value so people do not lose purchasing power if they use the money at a
later time. The most known and stable store of value is, up to today, gold. Many people buy
properties for stable value; paintings or other objects of art by recognised artists also fulfil
those characteristics and are often bought to store value.

At this point it is worth mentioning that Richard Douthwaite argues that there are
circumstances in which these three roles can come into conflict with each other. If, for
example, prices are rising quickly, money becomes a poor store of value and people spend it
as soon as they can, which raises prices even more rapidly. Therefore he believes it is
necessary to question whether countries can expect all three functions of money to be
adequately satisfied using just one form of money. (Douthwaite, 1999)

Bernard Lietaer points out two other important functions which national currencies fulfil today
(Lietaer, 2001):

4. Instrument of speculation
Nowadays 98% of all foreign exchange trading has become speculative; people are buying
currencies with an intention to make profits (or avoid losses) from the future change in value
of a certain currency. Speculative currencies market decreased a little with introduction of
Euro, when several currencies that previously existed in the world trading disappeared.

5. A tool of empire
Currency is a powerful way to create a homogeneous economic and information space.

14
Definition of Money

All these explanations talk about the functions of money. We even say that ‘money is what
money does’. But can we explain what money is? If we want to get to know money, perhaps
that is the first question we should answer.

Bernard Lietaer formed a definition of money based on its characteristics rather than its
functions:

“Money is an agreement, within a community, to use something as a means of payment.”

He addresses all the points of this statement:

- The money agreement is a social contract – like marriage or business agreements –

which can be attained formally or informally, freely of by coercion, consciously or
unconsciously. Most of us do not consciously agree to the money we use, nor do we
consider its nature. We just use it, unconsciously entering into an unspoken agreement
with our government, our banking system and all those with whom we conduct business
transactions and similar activities.

- Money as an agreement is always valid only within a given community, which may be
a small group of friends, a nation state or the global community. Some monetary
agreements are operational only for certain time periods, others go on for centuries.
For example, US dollar is an agreement that is valid throughout the world, while
Slovenian ‘tolar’ is accepted as a means of payment only in Slovenia. Some local
currencies would not be accepted even by all the people in a certain community but only
by some people who decide to support the scheme.

- The key function that transforms the chosen object into a currency is its role as
medium of exchange. Lietaer points out that other functions may be considered
secondary, as there have been effective and functional currencies that did not perform
some or any of these other roles.

To go back to the point where we started, now we can see through the mystery of money:

“The ‘magic’ of money is bestowed on some ‘thing’ as soon as a community agrees on

using it as a medium of exchange” (Lietaer, 2001)

From this formulation, Lietaer draws a very important insight: “Our money and monetary
system are, therefore, not de facto realities like air or water but are choices, like social
contracts or business agreements. As such, they can be subject to our review and
amendments.” (Lietaer & Belgin, 2006)

15
2. THE ORIGIN OF MONEY

What is the (hi)story of money, how did it come into being, and become what it is today?

Most people assume that money was invented as a way of facilitating trade, because barter 2
was inefficient. At first, people would produce for their own needs, and when they had a
surplus of something, they would try to trade it for something they needed. It was not always
easy to find a matching need. So they tried to exchange their surplus goods for something that
was more durable and they knew would be easily accepted by other people when they would
want to exchange it for something they needed. In the course of time, some objects were used
more in the exchange of goods since they were more convenient, divisible and durable, and
they started functioning as means of exchange. The more accepted they became, the more
people would use them. Gold and silver turned out to be very convenient for this purpose.

However, nowadays many authors acknowledge that archaeological, literary and linguistic
evidence of the ancient world and actual types of primitive money from many countries show
that barter was not the main factor in the origins and earliest development of money. Money
evolved independently in different parts of the wor ld and the use of money evolved out of
deeply rooted customs; the clumsiness of barter provided an economic impulse but it was not
the primary factor.

Most anthropologists agree that money started as a form of ritual gift – in the form of
something you gave the next door tribe when you met, or gave the father of the woman you
were going to marry, or gave to God at the temple.

Gift Exchange

The most celebrated example of competitive gift exchange was the encounter, around 950 BC, of
Solomon and the Queen of Sheba. "Extravagant ostentation, the attempt to outdo each other in the
splendour of the exchanges, and above all, the obligations of reciprocity, were just as typical in this
celebrated encounter, though at a fittingly princely level, as with the more mundane types of barter in
other parts of the world." (Davies, 2005)

The word ‘pay’ comes from the Latin ‘pacare’, which means to pacify, appease, or make
peace with. Boyle claims that economics was originally about mutual recognition and
facilitating human relationships, which is important to remember nowadays when money’s
secondary function is to replace human relationships with monetary ones. (Boyle, 2003)

William Bloom is even more blunt, stating something I feel we already almost forgot, but
which is of crucial importance: “People do not work and create the economy because they

2
Barter is a type of trade where goods or services are directly exchanged for a certain amount of other goods or
services; no money is involved in the transaction.

16
want to support the economy. They create and relate – and this, in turn, creates the
economy. ” He argues that our understanding of money and economics is based on a flawed
proposition that the economy is made up of savage human beings chasing scarce resources.

Bloom claims that “People love to be in relationship and to have contact with each other. We
like talking, touching, relating. We are animals of relationship. We are also animals who like
being creative and making things. Very few of us like to be constantly idle, and when we are
not idle we like to do things together. This is a very basic instinct. The human economic
animal creates and relates.” (Bloom, 1995)

A Short Journey through the History of Money

Throughout history various objects have been used as money3 ; quite unlike today, when
almost the only thing we consider to be money are national currencies. Perhaps we could go
back to thinking about money in broader terms? Let’s look at the variety of things used as
money in the past and the rich history of this mysterious concept, money.

The history of money is extensively and in many details explained in the book The History of
Money by Glyn Davies. The overview I will present on the following pages is based mainly on
the information collected in that book, except where stated otherwise. I’m extracting just some
basic and most interesting details, which I believe will help understand how money became
what it is today.

I couldn’t agree more with Davies’ motives for writing the book: that around the next corner
there may be lying in wait apparently quite novel problems which in all probability bear a
basic similarity to those that have already been tackled with varying degrees of success or
failure in other times and other places. Furthermore he is of the opinion that economists,
especially monetarists, tend to overestimate the purely economic, narrow and technical
functions of money and have placed insufficient emphasis on its wider social, institutional and
psychological aspects of money. (Davies, 2005)

But in addition to that, I believe that in the foundations of the money system that developed
throughout centuries might lie some of the reasons for the problems we encounter in the world
today. So let’s take a look at these centuries old foundations. Some of the actors we will meet
on the following pages will also reappear in later chapters of this work.

Commodities as Money

Livestock, particularly cattle, was probably the oldest form of money, following
domestication of animals. Initially, it was probably used for sacrifices for religious purposes;
only later it was adopted for more general monetary purposes. For monetary purposes quantity

3
The only civilization that functioned without money was that of the Incas. I did not come across any explanation
of this fact.

17
was of significance since cattle can be counted. The English words "capital", "chattels" and
"cattle" have a common root. Similarly "pecuniary" comes from the Latin word for cattle
"pecus" .

Cultivation of crops followed domestication of animals, so later plant products such as grain
were used as money; in parts of Africa even as recently as the middle of the 20th century. Safe-
keeping of grain (and later also other commodities: cattle, agricultural implements and
precious metals) was the origin of banking, which contrary to what we would assume,
preceded that of coinage. In ancient Mesopotamia writing was invented before 3100 BC, used
mainly for keeping accounts. In 3000 to 2000 Babylonian temples and royal palaces were
keeping commodities and receipts came to be used for transfers not only to the original
depositors, but also to third parties.

Similarly in Egypt, harvest was stored in centralized state warehouses, which led to the
development of a system of banking. Owners deposited their crops in the warehouses for
safety and convenience, or the crops were compulsorily deposited to the credit of the king.
Written orders for the withdrawal of separate lots of grain soon became used as a more general
method of payment of debts to other persons, including tax gatherers, priests and traders.

Other commodities used as money were pigs, horses and sheep, salt, rice, vodka, feathers,
leather, tobacco (and later even tobacco notes, attesting to the quality and quantity of tobacco
deposited in public warehouses) etc. Even in the beginning of 20th century the Kirghiz of the
Russian steppes used horses as their main monetary unit with sheep as a subsidiary unit. Small
change was given in lambskins. In China in 118 BC white deerskin was used as leather
money, about one foot square, which was worth 40.000 cash (‘cash’ was a base metal coin).

Cowrie shells were used as money in different places at different periods: in China as early as
1200 BC, the Chinese character for ‘money’ originally represented a cowrie shell; in parts of
Africa they were used as recently as the middle of the 20th century. During the post 2nd world
war hyperinflation in Germany, cigarettes, soap, tinned beef and chocolate served as
currency. In Yap, fei stones, varying in size from saucers to millstones, were still used as
currency as late as 1965.

Precious metals such as gold and silver were a common form of money in ancient times, first
in weighed quantities and gradually came the transition to quantities that could be counted.
The words "spend", "expenditure", and "pound" all come from the Latin "expendere" meaning
"to weigh" . Gold was and still is such a fascinating substance, and throughout history tightly
linked with money, that I decided to look at it in more detail. The research took me back to
cowrie shells as well as to alchemy. The record of this most interesting journey is to be found
in Addendum 1.

The ‘pound sterling’ in Britain was one pound of silver. The ‘dollar’ originated as the name
generally applied to a one -ounce silver coin minted by a Bohemian count named Schlick, in
the 16 th century. Count Schlick lived in Joachimsthal (Joachim’s Valley). His coins, which
enjoyed a great reputation for uniformity and fineness were called Joachimsthalers and finally

18
just ‘thalers’, the name from which word ‘dollar’ – as well as Slovenian ‘tolar’ – originates.
(Rothbard, 1983)

So called ‘tool coins ’, coins in the form of objects that had long been accepted in their society,
developed independently in East and West: China used spades, hoes and knives, while iron
nails were used in ancient Greece and sword blades by ancient Britons. These quasi-coins
were all easy to counterfeit and, being made of base metals, of low intrinsic worth and thus not
convenient for expensive purchases.

Coinage

Base metal coins were invented in China in 600-300 BC . Herodotus mentions the use of
‘coins’ in Lydia 4 around 600 BC, first as crude coins , then the first true coins consisting of
electrum, a naturally occurring amalgam of gold and silver. The Lydians developed a practice
of stamping small round pieces of precious metals as a guarantee of their purity. Later, during
the reign of Croesus 5 they produced separate gold and silver coin. From Lydia the use of
coins spread to Greece (Aegina, Athens and Corinth started to mint their own coins) and
Persia.

Gresham’s law
Bad money drives out good

When supplies of silver to Athens were cut off by Sparta, Athens issued bronze coins with a silver
coating in 406-5 BC. The public consequently hoarded superior silver coins, which caused them to
disappear from circulation. That is the first recorded occurrence of Gresham’s law, stating that “bad
money drives out good ”, mentioned in Aristophanes' play, “The Frogs”, produced in 405 BC.
Aristophanes wrote that "the ancient coins are excellent...yet we make no use of them and prefer those
bad copper pieces quite recently issued and so wretchedly struck." (Davies, 2005)

Even nowadays we can notice a similar occurrence: people prefer to keep banknotes or coins of higher
value, getting rid of their sma ll change as soon as possible. We perceive small change as less valuable
although it can buy exactly the same – and not so rarely we feel embarrassed to pay with small change.

As the Greek city-states and Persian emperors strove for predominance, rivalry developed
between different currencies. The states with strong and widely accepted currencies gained
prestige. Greek coinage was first and foremost a civic emblem, a proclamation of political
independence.

4
The area of what is today Anatolia, Turkey.
5
Croesus was renowned for his wealth and in Greek and Persian cultures his name became a synonymous for
wealthy men; in English, expressions such as "rich as Croesus" or "richer than Croesus" are used to indicate great
wealth.

19
Coercion played an important role in establis hing monetary uniformity. The conquests of
Alexander the Great brought about a large degree of monetary uniformity over much of the
known world. The Roman emperors made even more extensive use of coins for propaganda,
one historian even claimed that "the primary function of the coins is to record the messages
which the emperor and his advisers desired to commend to the populations of the empire."

Coins spread rapidly as they were very convenient. By the time of Middle Ages, monarchs
used this convenience as a source of profit. Coins commonly carried a substantial premium
over the value of their metallic content, more than high enough to cover the costs of minting.
Kings turned this premium into personal profit, which resulted in regular recall of coinage,
first at six yearly, then at three-yearly intervals, and eventually about every two years or so.
These recoinage cycles were far more frequent than was justified by wear and tear on the coins
but the profits from minting, known as seigniorage, supplemented the revenue that English
monarchs raised from the efficient systems of taxation introduced by the Normans.

Banking Services

The variety of coins in use in the Hellenic world led to the first and most common form of
Greek banking, money changing. Another important service was bottomry or lending to
finance the carriage of freight by ships. Other business enterprises supported by the Greek
bankers included mining and construction of public buildings.

Another sphere, already mentioned before, is development of writing and book-keeping in

ancient Mesopotamia and Egypt, originating from safekeeping of commodities. Under the rule
of a Greek dynasty, the Ptolemies (323-30 BC), the old Egyptian system of warehouse
banking reached a new level of sophistication. The numerous scattered government granaries
were transformed into a network of grain banks with what amounted to a central bank in
Alexandria where the main accounts from all the state granary banks were recorded. This
banking network functioned as a giro system in which payments were effected by transfer
from one account to another without money passing.

Since coins had not been invented, the Babylonians had developed their banking to a
sophisticated degree because their banks had to carry out the monetary functions of coinage.
The Ptolemaic Egyptians segregated their limited coinage system from their state banking
system to economise on the use of precious metals. But the Romans preferred coins for many
kinds of services which ancient (and modern) banks normally provided. After the fall of the
Roman Empire banking was forgotten and had to be re- invented much later.

In Italian city states such as Rome, Venice and Genoa, and in the fairs of medieval France, the
need to transfer sums of money for trading purposes led to the development of various
financial services including bills of exchange 6 .

6
Bill of exchange is a written order by the drawer to the drawee to pay money to the payee. The most common
type of bill of exchange is the cheque, which is defined as a bill of exchange drawn on a banker and payable on

20
Banking re-emerged in Europe at about the time of the Crusades, which gave a great stimulus
to banking because payments for supplies, equipment, allies, ransoms etc. required safe and
speedy means of transferring vast resources of cash. Consequently the Knights of the Temple
and the Hospitallers began to provide some banking services similar to those already being
developed in some of the Italian city states.

Paper Mo ney

Paper money was, like coins, also first used in China, from 806-821, due to a shortage of
copper for making coins. It became common from about AD 960 onwards. A drain of
currency from China, partly to buy off potential invaders from the north, led to greater reliance
on paper money with the result that by 1020 the quantity issued was excessive, causing
inflation. In subsequent centuries there were several episodes of hyperinflation and, after well
over 500 years of using paper money, sometime after 1455 China abandoned it.

Gutenberg invented the modern printing press in 1440. It was modified, by Leonardo da Vinci
among others, for use in minting coins, but it took another couple of centuries before printed
banknotes were produced in the West.

With the revival of banking in western Europe, stimulated by the Crusades, written
instructions in the form of bills of exchange, came to be used as a means of transferring large
sums of money and the Knights Templars and Hospitallers functioned as bankers.

During the English Civil War, 1642-1651, the goldsmith's safes were secure places for the
deposit of jewels, bullion and coins. Instructions to goldsmiths to pay money to another
customer subsequently developed into the cheque. Similarly goldsmiths' receipts were used
not only for withdrawing deposits but also as evidence of ability to pay and by about 1660
these had developed into the banknote.

Although paper money had no intrinsic value, it was usually widely accepted because it was
backed by some commodity, usually precious metals. Up to this day, a pound note has written
“I promise to pay the bearer on demand the sum of … pounds.” But if you take your banknote
to a bank today, what they’ll pay you is just another banknote.

Silver and Gold Standard

Silver/gold standard mean fixing the price of the currency in terms of silver or gold. During
the Napoleonic Wars convertibility of Bank of England notes was suspended and there was
some inflation. The pound was originally an amount of silver weighing a pound, and silver
had been the standard of value for centuries, until Britain adopted the gold standard for the
pound in 1816.

demand. Bills of exchange are used primarily in international trade, and are written orders by one person to pay
another a specific sum on a specific date sometime in the future. (Wikipedia, 2006)

21
France and the United States were in favour of a bimetallic standard. When the various
German states merged into a single country in 1871, they chose the gold standard and the
Scandinavian countries adopted the gold standard shortly afterwards. France made the switch
from bimetallism to gold in 1878 and Japan, which had been on a silver standard, changed in
1897. Finally, in 1900, the United States officially adopted the gold standard.

With the outbreak of the First World War in 1914 Britain decided to withdraw gold from
internal circulation and other countries also broke the link with gold. Germany, Britain and
France returned to the gold standard after the war. However the British government had fixed
the value of sterling at an unsustainably high rate and in the worldwide economic crisis in
1931 Britain, followed by most of the Commonwealth (except Canada) Ireland, Scandinavia,
Iraq, Portugal, Thailand, and some South American countries abandoned gold.

The United States kept the link to gold and after the Second World War the US dollar
replaced the pound sterling as the key global currency. Other countries fixed their exchange
rates against the dollar, the value of which remained defined in terms of gold.

Bretton Woods Agreement

Towards the end of the 2nd World War many countries, still remembering the experience of the
Great Depression of 1930s, felt that "the nations should consult and agree on international
monetary changes which affect each other. They should outlaw practices which are agreed to
be harmful to world prosperity, and they should assist each other to overcome short-term
exchange difficulties." (summary of agreements from July 22, 1944)

The conference in Bretton Woods in 1944 had at its core setting up a system of rules,
institutions, and procedures to regulate the international monetary system. They established
the International Bank for Reconstruction and Development (IBRD) (now one of five
institutions in the World Bank Group) and the International Monetary Fund (IMF).

The agreement envisaged a system of convertible currencies, fixed exchange rates and free
trade. The political bases for the Bretton Woods system were the concentration of power in a
small number of states, and the presence of a dominant power – USA – willing and able to
assume a leadership role in global monetary affairs. Member countries were required to
establish a parity of their national currencies in terms of gold (a "peg") and to maintain
exchange rates within plus or minus 1% of parity (a "band") by intervening in their foreign
exchange markets (that is, buying or selling foreign money).

In practice, however, since the principal "reserve currency" was the U.S. dollar, this meant that
other countries pegged their currencies to the U.S. dollar, and – once convertibility was
restored – buy and sell U.S. dollars to keep market exchange rates within plus or minus 1% of
parity. That way, the U.S. dollar took over the role that gold had played under the gold
standard in the international financial system. Meanwhile, the U.S. agreed separately to link
the dollar to gold at the rate of $35 per ounce. At this rate, foreign governments and central
banks were able to exchange dollars for gold.

22
The Bretton Woods system gave the US currency, and consequently the whole US economy,
even more power in the global market and economy. If we remember that ‘the magic of
money is bestowed on some thing as soon as a community agrees on using it as a medium of
exchange’, US dollar was now accepted, and therefore supported by the global community.
The fact that dollars were traded on global markets to regulate exchange rates of other
currencies, only added to its strength. And, as we have seen already in the example of ancient
Greek states and their currencies, a strong currency supports the power of its country on the
international market.

The Nixon Shock

and break-down of Bretton Woods

By the early 1970s, as the Vietnam War accelerated inflation, the United States was running not just a
balance of payments deficit but also a trade deficit (for the first time in the twentieth century). The
crucial turning point was 1970, when U.S. gold coverage deteriorated from 55% to 22%. Neoclasical
economists believe that this represented the point when holders of the dollar had lost faith in the U.S.
ability to cut its budget and trade deficits.

In 1971 more and more dollars were being printed in Washington and being pumped overseas, to pay
for the nation's military expenditures and private investments. On August 15, 1971, Nixon unilaterally
imposed 90-day wage and price controls, a 10% import surcharge, and most importantly "closed the
gold window," making the dollar inconvertible to gold directly, except on the open market. This
decision was made without consulting members of the international monetary system or even with his
own State Department. (Wikipedia, 2006)

Floating Exchange Rates

The break with precious metals broke the last connection of money to the physical world and
it helped make money an even more elusive entity, resulting in floating exchange rates that we
still have today. This is the first time in the history of the world that every major country has a
currency that is not based on gold or silver or some commodity.

Today, the value of currencies is determined predominantly by market forces. Combination

of the 1980s financial deregulation policy in the UK and USA and the technological shift
resulting in computerization further encouraged speculative market in currencies. According
to Lietaer, 98% of all foreign exchange transactions are speculative, and only 2% relate to the
real economy. (Lietaer, 2001)

“Something extraordinary has been happening over the past decade: the currency market has
become the biggest single market in the world. Foreign exchange transactions (purchases and
sales of currencies) today dwarf the trading volume of all other asset classes, even of the entire
global economy. As a result, currency markets are becoming vitally important to almost

23
everyone for the first time in the recorded history – although it is probable that the majority of
people are still quite unaware of this.” (Lietaer, 2001)

Lietaer states that the money exchanged at the foreign exchange markets amounts to over 150
times the total daily interna tional trade of all commodities, all manufactures and all services
worldwide. It is in the order of 100 times the daily trading of all equities in all the stock
markets around the world.

Intangible Money

I sometimes joke when I go somewhere and I’m trying to remember if I took everything I
need, that the most important thing – actually, the only thing I really need – is my credit card.
But there is a lot of truth in that: if I have money, I can buy anything I might come to need, I
can survive in this wo rld. And consequently, sadly enough, my whole identity is questioned
and crumbling as the numbers on my bank account go down.

In the modern ‘wired’ economy money began turning itself into bits and bytes and started
flowing around the world through satellite transponders and fibre-optic cables. The trends
today go in two directions:
- Electronic money (also known as digital money or cash) is money which is exchanged
only electronically. This involves use of computer networks, the internet and digital stored
value systems. In 1995 over 90% of all transactions, by value, were made electronically
(Davies, 2005).
- A smart card, chip card, or ‘integrated circuit(s) card (ICC)’, is defined as any pocket-
sized card with embedded integrated circuits. The applications of smart cards include ATM
cards, SIMs for mobile phones, authorization cards for pay television, high-security
identification and access-control cards, and public transport payment cards.
One kind is an electronic purse, which is basically a traveller’s check that makes exact change
and when the card is debited down to zero, you throw it away.
The second kind of smartcard is rechargeable. A third kind involves identification: it holds a
computer chip with DNA signature or a digital picture.

The Future

What does the future hold for us? The information revolution has changed people's perception
of wealth. The basis for wealth has evolved: originally land was wealth, then it was industrial
production. Now it is intellectual capital. The market is showing us that intellectual capital is
far more important than money. This is a major change in the way the world works. Just like
all the farmers who disappeared during the industrial revolution, the same thing is now
happening to huge numbers of people in industry as we move into the information age.

24
Flemming Funch wrote an interesting overview of the functions of money throughout history,
with some thoughts on what money should be in the future. The text is too extensive to include
here, but also much too interesting to drop, so I put a condensed version, which I most
recommend reading, in Addendum 2. Below is just a short overview of the core idea.

Proactive Money

Information providers, such as copyright owners, software producers, or artists running around angrily
trying to stop people from using their information without paying for their past work, is a sign of the
economics no longer being in tune with the methods of production and distribution. The fact of
the matter is that information inherently can be reproduced infinitely and there is no inherent value
in simply owning it, or in having worked hard at it. There is only value in using it. If instances of
information in itself had value, all one needed to do to be rich would be to duplicate it a zillion times. It
is nonsense of course. Making repeated copies of a software program on your harddisk doesn't produce
any wealth.

The concept of having to be paid for what one did earlier is no longer valid in the natural 3rd wave
economy. So how do we account for new useful information and services being made available? Do we
need to account for it at all?

There is really no big need to account for existing information, as it isn't limited and is impossible to
quantify. The same with creativity. What we can quantify and account for is anything that is in a
limited supply. For a 3rd wave economy we need a currency that doesn't reflect ownership or past
work, but that stimulates future creative work.

We probably need a system where anybody who creates or perceives value also creates money, and
the money is not a loan to be paid back, but a gift to be passed on. That is not possible with scarcity
money, but only with money tha t people can freely give without experiencing a personal loss from
doing so. This is money that gains value from being used on something desirable, and that retains no
value from being kept.

This corresponds with Bloom’s assertion that the true value of money is in the relationships
and opportunities which it provides. In the modern world of information technology and
information wealth, this is becoming increasingly evident. (Bloom, 1995)

But first let’s look at the money we use today.

25
3. MONEY TODAY

Money Creation
Do we really know where money comes from today?

People usually think that money is issued (and they imagine it as coins being minted and
banknotes printed) by the government or central bank. The truth is surprisingly different. Most
of the money is created by commercial banks as debt-money. To put it very simply, for each
deposit that any bank receives, it is entitled to create new money, in the form of a loan to
another customer of up to approximately 90% (a fraction) of the value of the deposit (held in
reserve); hence the name fraction reserve banking. (Lietaer & Belgin, 2006)

If the bank is obliged to keep for example 10% of the deposits, it means that at the moment
when somebody deposits 100 pounds on their account, the bank can approve 90 pounds of
loans. The original deposits can be drawn anytime while loans that the banks issue are due to
be paid back only after a longer period of time, which means that the actual amount of money
has doubled. In effect, a new amount of money is created each time the bank grants a new
loan.

The total quantity of money after this first transaction is already 190 pounds. With the newly
created 90 pounds people trade and at the moment when money sits in another account it
enables that bank to create another 90% by issuing new loans. By the end of this cycle the
banks can create up to 900 pounds of debt money, starting with only 100 pounds. This also
means that if all the depositors claimed their money at the same time – called ‘run on the
bank’, which does happen in crisis, for example when trust in a bank or banks is lost – the
banks would not have enough money to pay everybody out. In our times of electronic money
this is of course even more blurred.

Money Alchemy

Lietaer explains the “modern money alchemy”, which starts with the injection of say 100 million ‘high
powered’ money into the banking system, for instance by having the Bank of England pay government
bills for that amount. These funds end up being deposited somewhere in the banking system by the
recipients, which enables the bank that received the deposits to provide a loan for 90 million to
someone (the other 10 million becoming ‘sterile reserves’). The 90 million loan will in turn lead to a
deposit for that amount, enabling that next bank to provide another loan for 81 million, etc. This is how
what started as 100 million Bank of England ‘high powered money’ theoretically can create up to 900
million in ‘credit money’ as it trickles down the banking system. (Lietaer, 2001)

This kind of banking originates in goldsmiths’ activities, briefly mentioned in the previous
chapter. Let me invite you on a short journey to the Middle Ages.

26
Let’s pretend you are a banker…

The ‘money game’ exercise we played at ‘The Future of Money’ short course at Schumacher
College in January 2006 proved to be most helpful and a very powerful tool to understand the
process of money creation and some of its consequences. Maybe you can try playing this game
with a few friends.

The first part of the exercise was coming to the ‘market’ with something we wanted to trade
and with a need we had. Trying to make exchange made us realize how difficult it can be for
the needs and wants to meet using barter, direct exchange of goods. In the second part of the
exercise we brought gold into the game and introduced a few ‘bankers’ (of which I was one).

Imagine that you are a goldsmith in Venice in the 13th century, the times when gold or golden
coins were used as money to facilitate trade. People would come to you to measure the quality
of gold. You would also have a safe to store it, so sometimes people would keep their gold with
you, when they go travelling. You issue them a receipt and if you are a respectable and
trustworthy person, this piece of paper would be worth exactly the same as the quantity of
gold it represents, because people trust that you will give them that gold if they come to you
with the receipt. More and more people store their gold with you and they start trading by
using receipts instead of withdrawing their gold every time they want to trade.

Being a wealthy man, sometimes people come to you when they are in financial difficulties or
want to start a business for which they don’t have enough money. You know these people, so
you know that the person is sincere and that by granting somebody a loan you can help him to
a better life. With the new goods or services he will provide also the lives of other citizens will
be richer.

Soon you realize that not everybody comes to collect their gold at the same time, so it is not
necessary to have gold reserves for all the paper money you issued. You can lend some of the
money (or even just issue some more receipts) in the meantime and make some extra money
from interest by it. Thus more ‘paper money’ gets out to the society than there is actual
quantity of gold represented by the receipts.

My experience as the banker was the following: the first person who came to me wanted to
borrow some money to start a business. I found myself inquiring about the plans and also
what the person would be willing to offer in exchange for the loan. At that point I did not have
any ‘rates’. I spent quite a lot of time talking and clearing all the details, so that by the end
both of us were satisfied with the agreement. It was very much about relationship and working
together for something good to emerge, almost like a joint venture, not a fight who is more
powerful and will manage to get ‘a better deal’.

The second meeting was already much easier. The ‘client’ complained about another banker
who was very greedy and he was reassured by my concern, the time and attention I put into
his ‘case’. A mutual trust was built and we came to an agreement. But when I asked the man
to sign the slip of paper confirming what he borrowed and what and when he will pay it back,
he told me he could not read but that he trusts me and that he will sign it nevertheless. And he

27
put a cross (X) on my receipt! Now it was up to me to trust that he will come back after one
year with my money. I realized that I would have to have some backup for the cases when the
money does not come back.

By that time, our time for the exercise was up, and I managed to attend only to two clients,
while the banker ‘next door’ had a many more. Before we started the exercise we were told to
be as ruthless as possible, but somehow I forgot about that as soon as we ‘opened our
businesses’. For me it was about relationships, about coming together (community) and doing
something good for everybody.

But even so, I noticed that it would be quite easy to distance and detach my actions from the
actual situation – issuing more ‘receipts’ than I had gold reserves in my storage, and be
drawn into the pursuit to make more and more ‘easy money’, using other people’s money and
not having to put much work into it.

The process of creating bank-debt money is kept under control by the government and central
bank by setting the percentage of reserves that commercial banks have to keep and by
regulating interest rates. But still the fact is that this process is creating a huge amount of
new money, which is also burdened with obligation of interest payment from the moment
it is created, which has profound consequences on society at large, as we will see later.

Although this process is mentioned in basic economics textbooks 7 , the importance and the
consequences of it are generally overlooked. The commercial banks create money at profit to
themselves (the interest that they charge for loans) and it is they who decide both how much
new money to create and who shall borrow it for what purposes. It is in the interest of every
bank to lend out as much money as possible, because that is how they make profit.

Creation of money is not bad in itself, as the availability of money enables economic activity
and vice-versa, the activity can be truncated if there is not enough money to facilitate
exchange. But it can become a problem when the quantity of money is growing much faster
than the quantity of goods or services, which leads to inflation or even hyperinflation.

Boyle argues that more money has to be balanced by more goods and services. If money is
created for speculation – and at least 97% of the money changing hands nowadays is for short-
term speculation – then it is going to be inflationary. If banks create money just with a stroke
of pen by lending it as a debt, with interest attached, that is inflationary. In 1971 the amount of
money in circulation in UK was £ 31 billion; in 1996 it was £ 665 billion – which is an
increase of 2,145%! (Boyle, 2003)

7
Chapter 22 -3 of a current students' bible on economics - Begg, Fischer & Dornbusch: Economics, MCGraw-
Hill, 7th edition, 2003 - explains “how banks create money” and that “bank-created deposit money is much the
largest part of the money supply in modern economies”. (Robertson & Bunzl, 2003)

28
The Case of Properties Market

As a consequence, prices of luxuries are rising fast. A painfully obvious example is properties
market in England: as more and more so called ‘easy’ money is available, people tend to take
loans (mortgages) and invest money in properties, the prices of which are rising out of
proportion. Price of a house can double in a few years’ time although the inherent value of the
property did not rise, we did not invest anything in it. Actually, the quality of a house would
naturally deteriorate with time, so in real terms the property should even lose value.

The usual argument for the rising prices of properties is increased demand – presumably due
to growing population – on the market where supply of housing cannot follow it. But there is
another, much more important reason for this ‘properties bubble’; it is the money creation
process we explained earlier.

There is ‘catch 22’: people take mortgages to be able to buy a home. But each loan that they
take creates new money, which is released into circulation on the properties market.
Availability of so called ‘easy’ money pushes the prices of properties up. Even more people
become interested in investing in this growing market and are prepared to put in even more
money, which reinforces the vicious circle. Boyle estimates that as much as two thirds of the
money in circulation in Britain was created as mortgage loans. (Boyle, 2003)

Mortgage

In its medieval origins, the word mortgage means literally ‘death-pledge’ or ‘death-grip’. At that time,
mortgages were never a method of buying a property, they were a method of raising money on
property you already owned if you had fallen on hard times; a last resort in times of dire financial need.
Even so, mortgages were regarded with great suspicion, since it was generally goldsmiths employing
usury not dissimilar from modern banking methods who supplied the money, hoping at least for a large
profit, and possibly the chance of ending up with the property.” (Rowbotham, 1998)

England has already seen the boom and bust of properties market not so long ago. Due to tax
relief on mortgage interest, too many institutions lending too much credit and the diversion of
personal savings into the housing market after the Great Crash (fall of the stock exchange in
1987) there was a housing boom in 1988 – 1990. In 1990 to 1998, the collapse of the boom
resulted in the phenomenon of negative equity, when house prices fell below mortgage
obligations. This does have the effect of helping to curb inflation. (Davies, 2005) But when the
market collapses, it is the people who did not have much money in the first place, who suffer
most.

With expanding European market, which enables British people to buy – often much cheaper
– properties abroad, the pressure in the UK properties market is somewhat eased. But the
effects of the properties bubble are spilling over to other – less developed; and on the
international market less powerful – countries.

29
Interest Rates
The main mechanism governments and central banks use to regulate the quantity of money in
circulation are interest rates, which has strong impact on the whole economy. A slight change
in interest rates spreads out into the economy and can stimulate expansion or ruin people’s
lives. For a deeper insight on the impact of interest rates on economy I’m summarizing an
article by Larry Elliott, Economics editor at The Guardian, who called this kind of economics
bubble-onomics.

The hangover after too much punch

‘Interest rates are on the rise around the world and we will all be feeling the pain ’:
Larry Elliot in Economics section of The Guardian on Monday, August 7, 2006

Interest rates are going up around the world: The Bank of England raised interest rates by a quarter of a
point; the People’s Bank of China is putting the brakes on the world’s fastest growing economy, the
Bank of Japan has just ended a long period of zero interest rates designed to tackle deflation: and the
Federal Reserve of the United States has been rising the cost of money by a quarter point at each of its
last 17 meetings.
What concerns central banks is that there is far too much easy money sloshing around in the system.
Interest rates were cut and kept unusually low for a prolonged period earlier this decade amid fears of
recession. It became a lot cheaper to borrow and this meant consumers could ramp up their spending
and businesses were encouraged to invest.
It also meant more speculation in property and in financial markets, and a greater vulnerability for
borrowers when interest rates started to rise. Last Friday’s bankruptcy figures in the UK illustrate the
point. The number of people going bust has reached record levels: the figure is on course to hit 100,000
this year for the first time. The big high-street banks made a song and dance last week, but it is the
banks themselves that are to blame for nurturing the live-now, pay-later, have-it-all culture with
their aggressive marketing and irresponsible lending.
We will see in the coming months just how many individuals in Britain are living on the edge, with
only modest increases in rates enough to tip them over the edge. My guess is that the economy is far
more sensitive to a quarter-point rise in borrowing costs than it was, especially if there is a threat of
further moves from the bank. Insolvencies were 66% higher in the second quarter of 2006 than in the
second quarter of 2005 – a sign of just how tough many people are finding it to meet their financial
commitments. Add in spiralling energy costs, rising unemployment and higher interest rates and you
have the recipe for extreme difficulties for many households.

Slowdown
The same applies, perhaps even more so, to the US, where debt levels are even higher: the Fed has
raised interest rates from 1% (in the middle of 2004) to 5,25% and activity in the housing market is
weakening fast. With oil prices likely to stay high and jobs becoming harder to find we can only
envisage a market slowdown in consumer spending. And that would have knock-on effects everywhere
else.

30
That, paradoxically, is why any data that any normal person would see as bad – rising
unemployment for example – is seen by Wall Street as good. Why? Because rising unemployment
means the economy is getting weaker, which means lower interest rates / and they are good for share
prices.
The tripling of oil prices has had so little effect on growth that it may reinforce the feeling among
policy-makers that they overcooked things by leaving rates low for so long.

Markets have a naïve belief in the infallibility of policymakers. This is ironic, given that the prevailing
philosophy among policy/makers for 25 years has been in the infallibility of markets.
But perhaps the most scary thought is that this policy will work: the oil prices and higher interest rates
will slow down growth and inflation will abate. And then what? Presumably the whole dreary cycle
starts again: since only cheap money can persuade consumers to spend and businesses to invest,
interest rates come down. Liquidity is pumped into the banking system, once again offering credit at
‘unbeatable’ rates. Debt levels go up as the cheap money fuels a new bout of speculation. And when
the speculation reaches fever pitch, central banks hose things down for a while.
It seems that this way of regulating economies is just as crude an inefficient as the old system of direct
controls on credit – and potentially far, far more destabilising. This is not economics, it is bubble-
onomics.

Effects of Interest

As we have seen, one of the main characteristics of the current debt- money system is interest
as a built-in feature , which has important side-effects, but they are hidden under the surface.
This mechanism that works in a concealed way has profound influence on our society
(Lietaer & Belgin, 2006):

1. Encourages systematic competition

When a bank creates money by providing a loan, it creates only the principal amount;
however, it expects a return of the principal plus the interest. The bank does not create the
interest, it requires people to earn that extra money through their interactions with others. In
fact, no bank ever created that money. The equation simply doesn't add up since only banks
can create money and they all need to be paid back more than the money they give out 8 .
So how does a loan, whose interest is never created, get repaid? Essentially, to pay back
interest on a loan, someone else’s principal must be used. Not creating the money to pay

8
To isolate one variable, we have made the assumption of a zero growth society: no population increase, no
production or increases in the money supply. In practice, of course, all three of these variables grow over time,
which makes the impact of interest even more hidden.

31
interest is the device used to generate scarcity. It forces people to compete with each other
for money that was never created, and penalizes them with bankruptcy if they don’t succeed.
Competition is structurally embedded in the current money system. Ultimately, someone
must always lose.

Stephen Zarlenga makes an interesting point that early loans and interest in the pre-urban societies
were based on agricultural produce, such as seed grains, animals and tools. Since one grain of seed
could generate a plant with over 100 new grain seed, the farmers could easily repay the interest. Also,
since just so much seed grain could possibly be used, there were natural limits to this lending activity.
What was loaned had the power of generation, which the inorganic materials don’t – ‘money is sterile’
– so any interest paid in them must originate from some other source or process (Zarlenga, 2000)

2. Fuels the need for continuous and endless economic growth

Since over 90% of the money in the circulation is ‘burdened’ with obligation to be paid back
with interest, money has to grow, and every investment has to make money (return on
investment). The interest rate in fact determines the minimum required rate of growth, the
average rate of economic growth needed to remain at the same place. The first slice of growth
goes towards paying for interest 9 . Of course this monetary system was created during a time in
which nobody recognised any ecological or social costs of indefinite and compulsory growth.
Based on compound interest, money doubles at regular intervals. At 3% compound interest
money takes 24 years to double, at 6% it takes 12 years, at 12% 6 years. For the receiver this
creates an exponential growth pattern; but it acts like a cancer in the economic development of
those who have to pay the interest, instead of contributing to a healthy growth. The recent
inability of some developing countries to pay their national debts proves such unsustainability.
(Kennedy, 1999)

Unnatural Growth

A very often quoted example of the insanity of compound interest in the real world is that one pfennig
invested by Josef at the birth of Christ at 4% compound interest would have grown by the year 1749 to
the value of one ball of gold of the weight of the earth. By 1990 it would have grown further to the
value of 8,190 balls of gold of the weight of the earth. At 5%, by 1990 it would buy an incredible 134
billion balls of gold of the weight of planet earth. (Lietaer, 2001)

9
Lietaer and Belgin (2006) have an interesting view on this: »In agrarian societies, one customarily sacrificed to
the gods the first fruits of the harvest. Now, instead, we give the first fruits of our toils to the financial system.”
One could interpret that as shifting our focus from spiritual to material, The Fall into matter itself.

32
 3. Redistributes wealth

Payment of interest transfers money from those who have less money than they need to those
who have more money than they need and the wealthiest receive an uninterrupted rent from
whoever needs to borrow to obtain the medium of exchange.
It is a system of hidden redistribution, transferring money from the large majority to a small
minority, creating social polarization. The consequence is that large amounts of money
concentrate in the hands of ever fewer individuals and multinational corporations.
On the other hand for example Third World countries will never be able to get out of debt in
the current system as their debt is growing exponentially. Money acts like vacuum cleaner,
constantly sucking up resources from some regions with lower returns and redistributing
them to those regions with high returns.

Judaism, Christianity and Islam all prohibited usury, which was traditionally defined as
charging any interest on money. Islam even states: “What ye put out as usury to increase it
with the substance of others, shall have no increase from God.” – a statement which one could
understand as a claim that in exploitation (‘substance of others’) there is no spirit, no
sacredness. In Islam, people do not pay interest for a loan, but the lending banks or individuals
become shareholders in their business and take part of the ensuing profits – or losses.

“Is it a coincidence that after interest officially became legal, all democratic countries have felt
the need to create income taxes and income redistribution schemes?” ask Lietaer and Belgin.

These three side effects of interest – competition, the need for perpetual growth and
unrelenting wealth concentration – have been the hidden engines that have propelled us
into and through the Industrial Revolution. (Lietaer, 2001) But as we have said, we have
already moved from the industrial to the information era and the money we use no longer
serves us.

Misconceptions about Interest

Margrit Kennedy – who for years tried to find an answer to the puzzling question why it is
virtually impossible to carry out sound ecological concepts, and finally unravelled the
mystery, realising that the very mechanism of debt money and interest payment works against
it – explicitly points out some misconceptions about interest. Since the interest mechanism
works in a concealed way, it makes it even more difficult to understand the full impact of
interest on our monetary system.

The misconceptions that she explains are (Kennedy, 1995):

33
1. We only pay interest when we borrow money

Every price we pay includes a certain amount of interest, which has to be paid for the use of
the capital that is needed and was used for production. The exact proportion varies according
to the labour versus capital costs of the goods and services we buy. Where the share of capital
costs is low, the percentage of interest ‘hidden’ in the cost is relatively low, but she claims that
on average we pay about 30 to 50% interest in all the prices of our goods and services 10 . This
means that almost half of each pound goes to serve people who own capital.

2. Everybody is treated equally in this money system.

Common belief is that since everyone has to pay interest when borrowing money and receives
interest for savings, we are all equally well off within the present money system.
In reality, there are huge differences as to who profits and who pays in this system. Research
done in Germany, comparing the interest payments and income from interest in ten equal parts
of 2,5 million households showed that 80% of the population pay more than they receive, 10%
receive slightly more than they pay and the remaining 10% receive about twice as much
interest as they pay – and that is the share which the first 80% have lost. In Germany in 2004
that amounted to a transfer of about 1 billion Euro every day from those who work for their
money to those who can make their money work for them. (Kennedy, no date)
Kennedy goes even further, arguing that, since the constitution guarantees equal access of
every individual to governmental services – and that is exactly what money is, the tool the
government provides to the people to enable exchange of goods and services – it is illegal to
have such a system in which 10% of the people continually receive more than they pay for that
service and 80% of the people receive less than they pay.

3. Inflation is an integral part of any money system, it is considered almost ‘natural’

Most people see inflation as an integral part of any money system, almost "natural," since
there is no capitalist country in the world with a free market economy without inflation.
Because inflation is perceived as a given, most people believe that interest is needed to
counteract infl ation. Few realize that inflation is just another form of taxation through which
governments can somewhat overcome the worst problems of increasing debt.
Most governments in the world borrow to finance their activities, and pay interest. The
discrepancy between a government's earnings through various taxes and the interest it pays is
one of the causes of inflation. The larger the gap between income and debt, the higher the
inflation needed. Allowing the central banks to print money enables governments to reduce
debts. The reduction of the value of the currency – devaluation – hits that 80% of the people
hardest who pay more most of time. They usually cannot withdraw their assets into "inflation-
resistant" stocks, real estate or other investments like those who are in the highest 10% income
bracket.

10
As comparison: in medieval times people paid only one tenth of their income or produce to the feudal landlord.

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Inflation

The mechanics of inflation is very clearly and understandably explained in Rothbard’s book
The Mystery of Banking (1983): Expansion of the money supply is the prime active force in
inflation. Price levels of goods are determined by the supply and demand for money and when
new money is released into circulation, more money is available to buy the same goods, to
which the sellers quickly adjust by increasing their prices, therefore causing inflation.

What is more, in this process it is those who have earlier access to new money that benefit
from it most, as they get to spend it before the increased amount of money has caused its value
to drop and therefore the nominal prices of goods to rise. As the money is used and spreads
out into the community, this effect becomes smaller and it is the people who had little money
in the first place that usually this new money does not reach at all – but they still have to pay
higher prices for the goods. Especially fixed- income groups are most deprived –which results
in growing financial divide between the ‘haves’ and ‘have-nots’.

A very important factor related to this process are people’s expectations. If people know that
the prices will drop every year, they will delay their spending, such as with computer
hardware: the prices are dropping and quality rising every year, so people prefer to wait for a
newer, better version. But if people have inflationary expectations, knowing that the prices
will rise in the near future – as with properties in England – they decide to buy now rather than
later. The more people anticipate future price increases, the faster will those increases occur.

Characteristics of our Conventional Money

Lietaer points out that in Western his tory, a monopoly of currencies that play simultaneously
the role of medium of exchange and of store of value emerged. Initially these currencies
consisted of scarce and precious commodities of various kinds. They evolved into gold and
silver coins and finally into centrally controlled national currencies. (Lietaer, no date)

As per Lietaer and Belgin (2006), four key characteristics of money have emerged which all
national currencies nowadays have in common. These characteristics persist as unquestioned
features of ‘normal money’, wielding profound influence upon our societies and our world:

1. geographical attachment to a nation state

National currencies facilitate economic interactions with fellow citizens rather than with
foreigners11 . In effect, national currency reinforces our unity within the confines of one
nation-state, while simultaneously emphasizing our division and separation internationally.

11
Lietaer states that national currencies »are designed to facilitate«, which I would question, feeling from my
own country's experience of creating a national currency some 15 years ago, together with a new flag and coat-
of-arms, that primarily are formed as a tool of bolstering national consciousness and providing a sense of unity,
while promotion of trading within the nation-state was not consciously the primary reason.

35
 2. creation out of nothing - “fiat money”
All conventional national currencies in our world today are fiat cur rencies, created by an
authority that declares that something is the only medium of exchange acceptable in
payment of taxes – that is, the only valid ‘legal tender’.

The word ‘fiat’ originates in the Bible, implying the godlike ability to create something out of nothing
(ex nihilo) through the power of the Word: “the first words pronounced by God were Fiat Lux, Let
Light Be … And light was, and He saw it was good.”

3. issuance through bank debt

The process of money creation through bank-debt provides a smooth way to privatise the
creation of the national currency via the private banking system while maintaining
pressure on individual banks to compete for deposits. An important aspect of bank -debt
and fiat monetary systems is that debt- money derives its value from its scarcity (which is a
very strong enforcer of competition at the expense of cooperation) relative to its
usefulness.

4. incurrence of interest

The common feature of all these systems is that they tend to actively encourage savings in
the form of accumulation of money, for example by providing an interest income from money
savings. This kind of money is concentrated by relatively small elite, with a side effect that
the available medium of exchange remains scarce for a significant segment of society. Interest
rates also encourage short-term vision in investment. (Lietaer, no date)

Lietaer argues that imposed monopolies of scarcity based centralizing currencies, which are
issued by central authority have emerged in patriarchal societies. Such currencies, besides
the effects mentioned in the previous paragraph, also promote boom and bust cycles and
destroy community. (Lietaer, 2002)

Lietaer summarizes the main features of our conventional money (Lietaer, 2002):
1. it is created by a global hierarchy, where developing countries don’t have a chance at
influencing the rules;
2. it is enforced at the national level through a hierarchy under the authority of a Central
Bank;
3. interest feature encourages accumulation and concentration of wealth;
4. scarcity of money promotes competition among their users.

Lietaer defines this money as ‘Yang’-type currencies. We will come back to this concept and
expand it in one of the later chapters.

36
4. THE CONSEQUENCES
Many people would agree that there seems to be something wrong in the world today, that
wrong things get priority; and they are wondering how that happened and how it is possible
that we keep on going in the wrong direction. We have looked at characteristics of modern
money and its mechanisms. I will not claim that the money system is the ultimate answer, but
I do believe that it has a huge impact on society at large and is accelerating decay of
community, values, quality, nature etc. throughout our world.

Lietaer states that: “Humanity has demonstrated time and again both an inherent directive and
capacity to make ever greater sense of this world we inhabit and to improve the human
condition. Yet, mounting evidence suggests that it is the very behaviors and practices of
humanity itself that are implicated in many of the most pressing challenges to our environment
and the future of our civilization. … Many of the most important issues we face and the
solutions we seek reside within the architecture of our monetary system and our
understanding and distinctions, or the lack thereof, with regard to money.” (Lietaer &
Belgin, 2006)

Let’s look at some of the consequences of this money that is imposed on us and required from
us, money that needs to grow and money that we want to accumulate and need to compete for.

Personal Sphere

Today it is virtually impossible to live outside the money system, except maybe on the total
margin of the society. Money became a necessity to survive, it is imposed upon people.
Because we seem to have no choice but somehow make the money that we need to exist, we
start to feel fear if and how we will succeed. This leads us to the need to comply with the
money system and make compromises at the expense of our soul.

We take on jobs for money instead of pursuing what we would want to do. We come to
believe that we need the job that is draining us and start thinking that we cannot get anything
better anyway. We put up with silly working hours, an unfair boss who needs to shake off his
stress every couple of days. We start feeling guilty when we want to take a holiday or when
we need to stay at home because our child is sick. We are slowly sliding into a situation of less
and less power over our own lives.

We have given the power over to money, who became our master. Our initiatives are not
coming from our integrity, our potential and creativity; instead they are based on fear, they
originate from what we perceive is needed, expected and possible in the outside world. And
that is the world driven by the money system; the world of growth and competition. In this
world we better give up our beliefs and ideals of what the world should be like, where people
would be more important than things and deadlines, where we would love what we do and feel
empowered and energised by the work we do.

37
Scarcity Mentality

Lynne Twist explains that “our relationship with money – in which scarcity is deeply embedded – is
an expression of fear; a fear that drives us in an endless and unfulfilling chase for more, or into
compromises that promise a way out of the chase or discomfort around money. In the chase or in the
compromises we break from our wholeness and natural integrity. We abandon our soul and grow more
and more distanced from our core values and highest commitments. We find ourselves trapped in a
cycle of disconnection and dissatisfaction.” (Twist, 2003)

She claims that this mind-set of scarcity is perpetuated in the myths and language of our money
culture. She states the three central myths that are underlying the scarcity consciousness:

1. There is not enough.

This belief generates a fear which drives us to make sure that we are not the person who gets crushed,
marginalized or left out. It justifies self -centred behaviour, for example putting our own material
desires above the health, safety and well-being of other people – or nations. We even create systems
that support it (education, health care, housing).

2. More is better.
This is a logical response if you fear that there is not enough; it drives a competitive culture of
accumulation, acquisition a nd greed that only heightens fears. The rush for more even distances us
from experiencing the deeper value of what we already have. We are programmed to think that we
need more – but if we believe that, we can never arrive; we are doomed to a life that is never fulfilled
and lose the capacity to reach a destination.

3. That’s just the way it is.

It is sad and scary to see the extent of this belief in the world, how even the people who feel there is
something wrong and things should be different feel powerless to do anything about it. “That’s how it
is; there is nothing we can do; we have to live with it and find our ‘modus operandi’ in this world – if
you can’t beat them, join them.” When I hear this mantra it makes me feel sick and want to get off this
planet.

Most people give in to this system; some become very passive, others very competitive,
fighting their ‘way up’ – which, as the metaphor has it, means stepping on other people’s
backs. The first lose their ability to live fully and successfully while the second adapt the
formula that proved to work throughout their lives and relationships, at the expense of others.

How we feel at work, where most of the people spend most of their days, can – and does –
influence the quality of our lives, our health. People wake up one day, perhaps upon learning
that they have a serious disease, and realise how they have given up their lives because of the
belief that they have to put up with violation of their soul. Suddenly they see how their soul
slowly died away, squeezed into an ever smaller space by all the compromises it had to make
to survive in this world.

38
We have lost purpose, lost view of the bigger picture. We can only see that we must work for
money, to survive. We don’t see the contribution of our work to life, to beauty. And most of
the time, in the world we live in, there is no such contribution; our activities as programmed
by the money system are often working in the opposite direction, towards destruction of soul,
relationships, nature, beauty, value.

Economic Activity

We need money – and money has to grow. The pursuit of growth, which we have seen is
built in the very foundations of the money system and which is directing our activities, is on
the most fundamental level stimulating us to maximise profits. Very often the process of how
we obtain return on investment is almost unquestioned. The growth mechanism subtly leads us
to think in terms of earning more money and cutting down on costs. You can probably
quickly think of quite a few examples of how that shows in behaviour of almost everybody,
from individuals and outwards. “How can I get as much as possible, giving as little as
possible.” has become our unconscious thinking and modus operandi in this world

Furthermore, if we want to earn more, we need to produce more (or, as individuals, work
more) and convince people to buy what we are selling, whether they need it or not. We are
trying to create needs and stimulate consumerism. The need to ‘sell’ what we have drives us
to see the world as a battlefield, where we have to compete with others to get our piece of (the
limited) cake, and very often our actions in this tough world become unfair and dishonest.
Nowadays we don’t produce so much as we process, we are aiming to add value, which we
achie ve by adding processes; but often these processes just create unnecessary packaging or
even decrease quality of products, especially food.

Cutting down on costs on the other hand leads us to exploit others, whether within our own
company or people on the other side of the globe. It drives us to extract wealth from nature
and society and turn it into profit for ourselves. It stimulates us to try to put the costs and
responsibility for our own actions onto somebody else – because, as we have seen, in this
system somebody has to lose.

This orientation towards maximising returns results in increasingly short-term thinking, we

strive to make as much money as possible in as little time as possible; often at the expense of
people, society or nature. Nowadays most corporations are focused on quarterly financial
results, aiming to keep the value of the company’s shares up and rising. Even people who are
trying to pursue different goals are finding it increasingly difficult; it is like trying to swim
against the current, the current being the unsustainable money system.

Society

As a result of this money system, where the primary drive for any activity is making money
and its need to grow, the system itself stimulates activities that make profit and tends to
overlook the rest. There is also strong reluctance for money to flow from profitable economic

39
activities to other, non-profit activities. W hole sectors – such as education and health care –
are simply cut out of the economic equation, or they are forced to become ‘profitable’.
Unfortunately, they can never make as much money as speculation on financial markets or
investing in properties; while on the other hand this tendency makes them even less affordable
for many people.

The flow of money towards most profitable activities and towards those who already have
money is creating ever growing inequalities on all levels: between countries, within countries
(between urban and rural areas; all around the world investment and people are moving to
cities), even within companies the difference in the income of the top and bottom level
employees is growing exponentially. Lietaer states a shocking fact that the pay gap between
top executives and their average employees in the 365 largest US companies soared from 42:1
in 1980 to 531:1 in 2000. (Lietaer & Belgin, 2006)

Business, having money and consequently power, is becoming stronger than governments.
Nowadays whole countries compete for investment money, which they expect would bring
them earnings and jobs; but in fact the only interest of the people/corporations who invest is to
make profits as big as possible, which in the end means that money and wealth will flow out
of the country. Economic activity is constantly moving to the areas where it can make higher
returns. That is simply an automatic part of the wealth-redistributing mechanism of the money
system.

Perhaps the most worrying should be the influence of money, i.e. those with most money, such
as multinational corporations, on politics. Nowadays, politics is conducted according to those
who financed the campaign (which is most obvious in the US) and protects their interests, thus
even reinforcing the power of money.

Nature

In our pursuit of money we are polluting air, water and soil; we are thoughtlessly dumping
tons of non-degradable waste daily, burying radioactive waste in the Earth etc.

For decades, human race has been extracting natural resources, and turning them into profits.
Agricultural revolution was based on extracting nutrients from soil, which is causing depletion
of soil. Trees and whole forests have been burned down or cut down to provide land or used as
source of energy. Industrial revolution was built on the energy of oil, pulling up fossil fuels
from the Earth crust. Human activity keeps releasing greenhouse gasses to the atmosphere,
while on the other hand destruction of forests is diminishing Earth’s capacity to absorb carbon.

This is seriously affecting the sensitive balance of the planet, the climate is changing rapidly,
which we can already see resulting in floodings, droughts and hurricanes. Another
consequence of damage done to natural habitat is loss of biodiversity and extinction of
species. These processes and human influence on nature are in greater detail explained in my
essay for Global Module ‘Gaia – The Earth System’.

40
Global Economy

The speech of a representative of South American indigenous communities, Guaicaipuro

Cuatemoc to European heads of state is the most powerful illustration of the global situation I
have ever read. It is touching on the depth of inequality in the world, distribution of power and
what it is built on and it exposes the blindness of the developed world to this sick and hurtful
mechanism. The speech is here slightly shortened. Let indigenous wisdom speak :

Who owes whom?

My brother, the European hypocrite, explains to me that all debts must be paid with interest even while
he buys and sells human beings and entire countries without their consent.
I too claim payment and I too claim interest.
Proven it is, in the archives of native peoples, by paper upon paper, receipt upon receipt, and
signature upon signature, that between the years 1503 and 1660 there arrived at San Lucas de
Barrameda 185,000 kilos of gold and 16,000,000 kilos of silver from the Americas.
These should be seen as the first of many, many friendly loans from the Americas towards European
development enabling the reconstruction of a barbaric Europe, ruined by wars against Islam.
Such a fabulous transfer of capital was no less than the beginning of a ‘Marshal Tesuma’ plan. So, to
celebrate the Fifth Centennial of the IOU, we can ask: have our European brothers made rational,
responsible or even productive use of these amounts so generously advanced by the International Indo-
american Fund? Sadly, the answer is – ‘no’, in their campaigns they have squandered it, mainly for
battles and mutual extermination.
They have been unable, despite the 500 year moratorium, to repay the principal and interest, let alone
to live free of the further dividend s, the raw materials and cheap energy exported and continually
provided to them by all the ‘third world’.
We do not stoop to charging the villainous leech rates of 20% and up to 30% that our European
brothers charge the peoples of the third world. We merely require the return of the precious metals
advanced, plus the modest accumulated interest of 10% for a period of 300 years with a 200 year
period of grace.
On this basis, and applying the European formula for compound interest, we advise our ‘discoverers’
that they owe us, as initial payment on the debt, a mass of 185,000 kilos of gold and 16,000,000 kilos
of silver. As for the interest, we are owed 440,000,000,000,000,000 kilos of gold and
38,000,000,000,000,000,000 kilos of silver (1% of the mass of the moon). At the rates of mid 2002 that
equates to a total of US $ 391,000,000,000,000,000,000.
To infer that Europe, in half a millennium, has not been able to generate sufficient wealth to pay off
this modest interest, would be to admit the abject failure of its financial system and the demented
irrationality of the premises of capitalism.
(Boyle, 2003)

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Systemic Problem

If we look at today’s global situation, it is more than worrying. What the major world
economies are undergoing, as per Lietaer, is not a classical business cycle but a slow-motion
systemic economic breakdown : the Japanese real- estate bubble and stock market crash in the
1990s; the collapse of Asian tigers in 1997/98; unemployment problem in Europe is at its
worst since 1930s; US high-tech bubble burst in 2001 and dollar crash is almost expected in
the next few years.

We have had 130 monetary collapses in the last 30 years and over 90 main bank crashes.
Money systems are in turmoil and monetary instability is systemic. Since the money system
affects every other of our systems, instability spreads out throughout society.

There are different superficial causes for all these crises, but the global context reveals
common underlying dynamics: exhaustion of the Industrial Age Model. This shift is similar
to the transition from Agrarian to Industrial Age. China is recently hugely accelerating the
problem of the Industrial Age model, due to the size of its population and the consequences of
its quick development are overwhelming.

On another level, we can notice geopolitical contraction, places of power are getting into a
spasm. Washington is controlled by ever narrower special interests, which results in war and
fear mongering. War brings additional risks and fear causes even more controls.

Lietaer claims that we are facing several global problems, which are all converging at this
point in time (Lietaer & Belgin, 2006):
- climate change; financial interests are in conflict with long term sustainability, which
results in various ecological problems, increase in natural catastrophes (earthquakes,
floods, tsunami), loss of biodiversity
- job crisis ; unemployment is spreading to developed countries and the information
revolution is enabling work being done without the need for much human engagement,
which is creating jobless growth; Lietaer claims that idea of job for everyone will die
with industrial age: “The world’s 500 largest corporations have managed to increase
their production and sales by 700% over the past 20 years, while at the same time
reducing their total workforce.”
- financial divide ; the divide between “the haves and the have-nots” is growing
worldwide.
- monetary instability; only the countries which are outside the system (i.e. don’t have
banks or have oil) are not affected by this
- age wave; the question is how will we be able to provide for elderly people

Lietaer believes that we are living at an interesting time and we are running out of
conventional solutions. None of these problems will be solved with today’s money system, if
it rema ins a monopoly. He is proposing that we are getting to the point when money systems

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will have to change. The system is breaking down already and new solutions are emerging all
over the globe, practice is already ahead of theory. Electronic money could bring an end of
monopoly of bank debt money; cheap computing is enabling a monetary revolution.

The Future

An article in The Independent on Tuesday, July 4, 2006 conveys that ‘Society in 2025 will be
based on selfishness’. Could that be at least partly a consequence of the money system we
have and its mechanisms? Let’s look at the prognosis.

A new study under the title “2025: What next for the Make Poverty History generation?”
suggests that consumerism and individualism may prove a more dominant force by 2025
than caring about the problems of poverty at home and abroad. Forecasting group Henley
Centre Headlight Vision tested public attitudes to help it guess what kind of a society Britain
might be in 20 years’ time. It found that, for the first time since 1994, Britons regard looking
after themselves as more important to quality of life than looking after their communities. In
three of the four likely scenarios for 2025, selfishness appears to outweigh caring about others.

The first scenario is called Choice Unlimited, in which today’s consumerist culture would
become stronger, ethical consumption less mainstream and people would engage with
international issues only sporadically. Most people would have “personal home stylists” who
would refresh their wardrobes, kitchen and interiors every four to six weeks.

In another, called My Home, My Castle, Britons would look inward, be suspicious of each
other and encourage the Government to concentrate on British rather than global issues.
International development would be low on the agenda.

Another scenario, called The Puritans Return, would see people focusing much more on local
issues, a rise in self- righteousness, the poor regarded by the masses as undeserving and the
government expected to set a “moral” agenda at home.

The other possible outcome is The Good Life, where community involvement grows and
politicians come under increasing public pressure to focus on global social and environmental
justice. Green issues would be part of mainstream politics and climate change at the top of the
agenda.

Michelle Harrison, who carried out the Henley study, argued that British attitudes to the world
will be crucial to the fight to eliminate global poverty. “The four scenarios showed how
vulnerable “social ideals” wer e and that people could shift their priorities as consumers
quickly. The question this generation wants answered is whether protest and politics ever
really get us anywhere. Public cynicism, disappointment and disillusionment could put the
progress at risk.

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5. MONEY AND SOUL

When we give a child a chocolate egg, he will eat it instantly. But when we give him some
money, he will put it in his little wallet (where he’s got play credit cards and old loyalty cards
discarded by his parents). He does not need it, he’s not saving for something, most of the time,
but he is fascinated by it, glow in his eyes, like it’s something really special. When he wants
an ice cream, he will ask his parent for it, he will not want to spend ‘his’ money. And once he
starts accumulating it, it’s as if some power that money has over us starts to get stronger. Now
he will ask adults for more money, count it; show to people how much he’s got.

A child appreciates his money; he will choose, or exchange his old banknote for a newer,
crispy one. He will wonder at a shiny coin. Maybe a child sees more spirit, more magic in
money than we are able to? In the end, a child will spend his money on something that is
really meaningful for him. And as we know how important it is for him, we will give him the
missing amount.

What happens then? This mystery object, money, a promise and an expectation, has turned
into something ordinary, just another thing. A thing that can get broken the very next day, a
thing that most of his friends have, so it is nothing special any more, a thing that is only
interesting for a few days and then ends up under the bed. Before, money was accumulating,
growing and now this object is less shiny every day, getting scratched and damaged, losing its
magic. No wonder we want to hold on to money, that promise of something special and
mysterious.

Limitless Possibilities

Reading these thoughts, a friend had an interesting insight: “As long as we have money and we don’t
spend it for buying something, money holds thous ands, perhaps even unlimited number of possibilities.
These theoretical possibilities are limited only by the amount of money we have. In money lies the
promise of everything we long for. But in the moment when we spend money for one of these
numerous possibilities, the value of it drops, because we have limited our choice to one of the thousand
possibilities. The thing we bought is worth one thousand times less than the money we bought it with.
As soon as we spend money it loses value because we limit ourselves to the thing we bought and at the
same time give up all the other possibilities that we could have bought with that money.

That is the magic of money, the feeling that it enables everything. It is just a feeling, it’s not real; as
long as we have money, we have just one thousand theoretical possibilities and not one practical, but it
seems that to many people this feeling of ‘I could if I wanted to’ is worth more than the thing they
bought. It is similar to deciding what to do in life: as long as you don’t do anything, you could do
everything. But when you decide for one thing, you have to accept the fact that now you cannot do all
other things; and that hurts, this denial, this conscious giving up. It is the same with money, which is
why many people feel happier accumulating money than spending it.” (Matej Frece, personal
communication, August 2006)

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Besides being a tool to facilitate exchange, money is a strong symbol – representing wealth
and power – and has profound, yet somehow unexplainable effect on our psyche. On the
previous pages I looked at the ‘material’ dimension of money in this world, but even in that
mainly physical domain we have time and again touched on the fact that money is intimately
related with the human psyche.

Hillman, in his essay on ‘Soul and Money’ (Hillman, 1989), recognises the link between the
two and the importance of money in our lives: “Yes, soul and money; we cannot have either
without the other. To find the soul of modern man or woman, begin by searching into those
irreducible embarrassing facts of the money complex, that crazy crab scuttling across the
floors of silent seas. ” Recognising the complexities and paradoxes of life, he dares to say, in
his provocative way, that money is devilishly divine :

“Money is as deep and broad as the ocean, the primordially unconscious, and makes us so.
It always takes us into great depths, where sharks and suckers, hard-shell crabs, tight clams
and tidal emotions abound. Its facts have huge horizons, as huge as sex, and just as protean
and polymorphous.”

How often have we hoped and dreamed of getting a large sum of money, perhaps a rich
benefactor recognising how special we are and deciding to support us, ending all our worries.
But somewhere deep inside we feel guilty about having money. We get upset with people who
have more and who seemingly don’t have to think and worry about money. It doesn’t seem
fair that some people earn millions while others count in cents. And no matter how much we
have, it seems that there is never eno ugh anyway.

These are just some of the beliefs about money; we have many others, often unconscious
beliefs:
- Money is necessary for survival.
- I have to work hard to earn money.
- I have to use my money sensibly, and not spend it irrationally.
- It is always good to have some money saved ‘just in case’.
- If I don’t have money, I’m a loser.
- An honest person cannot be rich.
- If you have a lot of money, you must have made it in an dishonest way, you’re bad.

Do you share any of them? They seem very obvious truths, which perhaps one would not call
unconscious. Still, they are beliefs which constantly shape our behaviour, and usually we are
unaware of that process. We don’t make our choices being fully conscious of where they are
coming from and considering if that is really what we stand for. Money can enable us to
connect with others, open our hearts and share, or cause that we shrink in fear, holding on to
what is ‘mine’ and grabbing for more.

Bernice Hill sees the depth and complexities of money but in them also recognises a lot of
potential for growth (Hill, 2004):

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 “Money has survival power and the potential for transformation. It excites us and it can
drive us mad. It stirs our hungers, for it can satisfy our personal desires with great dispatch.
Yet, as an expression of the maturing soul, money can infuse the deepest kindness into the
world. In this way, ironically, money can be a great teacher. The relationship we have with
money provides feedback about how we are ‘in’ the world. Our dynamic and ever
changing process with money holds up a mirror to our personality and our soul.”

Money Complexes
Hill studied the complexes people have around money. She explains complex as a hidden,
habitual response that pulls us down into a vortex of reactivity. A complex carries intense
feelings and compulsive behaviour. (Hill, 2004)

Hill proposes that money can trigger all of our complexes and bring to the surface their
underlying basic emotions. She argues that money complexes are greatly influenced by our
early experiences and memories: we often automatically take up the money belief-systems of
our parents, as well as our early family situations. These experiences are imprinted at a deep
level of our psyche and shape our money behaviours.

She made an attempt to explain some of the basic money complexes:

Money and Fear

According to Hill, complexes of fear around money often relate to anxious feelings and
reactions to a particular parent who was to provide nourishment and support. If we
experienced some form of deprivation (a distracted, depressed or punitive parent) we can have
a lifelong paranoia around money. Such feelings often lead us to be naïve, resentful and
dependent in money matters.

Money and Greed

Again, Hill explains that the early roots for greed may lie in family experiences, messages and
sibling rivalry. When children have to compete for scarce resources, a win-lose pattern is laid
down deep within the psyche, forming the basis of greed. She claims that money magnifies
greed and envy remarkably: there lurks in many of us the hungry “hoarder”. There is the
“gambler” who sees a get-rich-quick scheme and takes a short cut. There is the “saboteur”
who destroys the family budget.

Money and Anger

Hill proposes that early wounding can result in bullying, domination and cheating. Complexes
originating from childhood underlie many angry marital fights around money. Conflicts also
often surface in families who have inheritance issues.

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I recognize in myself anger at wealthy people, people who have more and especially people
who seem to have ‘enough’, who don’t seem to have to worry about money. This translates to
the societal and global level, on which I can resonate with the pain, frustration and anger of
the poorer people, or less developed countries on the global scale.

Money and Pride

As an old Jewish proverb goes “With money in your pocket you are wise and handsome and
you sing well too.” Hill points out that money can lead to a sense of entitlement and a stance
of superiority. She affirms that the valuation of oneself based on social status perpetuates “the
false self” identity and it is endemic in a materialistic culture.

Money and Loss

Hill reminds us that money opens doors and leads to opportunities so its absence can thwart
these hopes.
If I don’t ha ve money, I feel the choices I can make are reduced. I cannot join friends on an
outing trip or invite somebody for dinner. And I don’t want to accept gifts from others when I
feel that I will not be able to give something back.
Hill claims that ruined expectations can cause major depressions; this might sound overstated,
but anybody who has been through it knows exactly what she means. I have been in that dark
space, coming to an end of my savings and awakening all the sleeping fears around money,
identity and survival.
But Hill further claims that loss of the sense of oneself can afflict anyone, regardless of
income: we will suffer greatly when our identity is interwoven with our resources and we
experience some financial setback.
That is a big lesson I’m learning at the moment: who am I, really, and what is my life about,
when I’m stripped of everything; almost out of money, family and friends are far, I have no
job and what is even worse, no clear path ahead of me.

Money Wounds of the Wealthy

Hill also mentions wounds of the wealthy, claiming that contrary to common belief, life is not
easy for most people of wealth. Their problems are often hidden and occur within the most
intimate levels of the psyche. She talks about five wounds can be particularly painful for
people of wealth: (1) a sense of isolation, (2) the burden of expectations, (3) a confusion with
self-esteem, (4) family dynamics, and (5) the subtle psychological losses. As you might feel,
this is one sphere that I have difficulty relating to.

How many of these complexes can you recognise in your own life? Do they resonate with
you? Can you track their origin back to your childhood, to the way your parents perceived
money and/or to the way they treated you?

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Perhaps even that is connected: in my family there was always a feeling that money is
restricted, it is something you need to work hard for, and spend modestly. Born in the 1920s,
my parents both experienced the 2nd world war and afterwards, with 4 children and only one of
them working sometimes they would barely have enough to eat. As they grew up, children had
to take on a profession that would provide their living as soon as possible.

What my parents taught me about life and myself, probably not even consciously, is that I
need to comp ly, quietly observe what is going on in the outside world and then make sure that
I fit that, in order to survive. I learned that lesson well, but at the expense of giving up my own
expression, silencing the voice of my soul over and over again. And it is very difficult to undo
these beliefs, which are so deeply and tightly intertwined with my very being.

Money and Survival

Bloom explains that money is both materially and psychologically entwined with our most
primal senses of survival (Bloom, 1995):

The Biology of Need

Because money is the medium for achieving food, shelter and warmth, it is the target for
primal fears about survival. The things we need for survival are, in our culture, bought by
money. We have no choice but to use money. The primal reality is that without money we
might die. Whatever fears we have about our survival may be psychologically projected on to
money. Greed and anxiety directly reflect our sense of biological security.

The Psychology of Need

But Bloom explains further that money is the medium that buys all the material images we use
to achieve our psychological sense of identity; it delivers what we need for psychological
survival. Money pays for the lifestyle and cultural symbols that give us psychological identity
and safety. Our sense of identity is such a crucial element of our psychological health that any
threat to our identity, a breakdown of lifestyle, can lead ultimately to nervous breakdown and
total psychological collapse.

Bloom believes that the relationship between money and psychological survival is the most
powerful human dynamic in economic behaviour. He claims that it is precisely this lack of
psychological insight which has led to so much naïveté about economic behaviour and
reality. He is writing about it extensively. As it thoroughly resonates with the journey I’ve
been through, I will present a shortened overview on the following pages.

Bloom (1995) explains that this dynamic has its roots in our earliest infantile needs for social
acceptance, for without social acceptance we would lose warmth, nurture and succour.
Without social acceptance, we would die. This need for psychological safety is not a conscious
mental function, but is an instinctual drive. When satisfied, we feel good to the point of
euphoria. When it is threatened, we may suffer complete breakdown.

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Sense of Identity

The basic feature of this psychological safety is to have a clear sense of who we are in
relation to the people and the social situation around us. As infants we adapt our behaviour
and attitude so that we get fed and nurtured. Right behaviour equals survival. Wrong
behaviour equals death. Our basic strategy as infants is unconsciously to internalise the
behaviour of the important people around us: we unconsciously copy them and become like
them. We unconsciously become our social identities.

Our identity which we build in order to survive in our family and community is something we
present to the outside world. But it is also how we recognize ourselves. In a very fundamental
manner we know who we are in relation only to our family and community. We discover who
we are by reference to how others experience us and by how we experience ourselves in
reference to them. When everything fits, our unconscious inner child feels safe and reassured
about its survival. When the inner sense of identity does not fit external realities, the inner
child is profoundly threatened to the point of trauma and collapse.

This collapse can be terrible. Without a clear sense of self, people can sink into a state of non-
being and meaninglessness, a state called ‘anomie’. It is a much-observed phenomenon; for
example people who lose their jobs can lose all sense of who they are and slip into depression.
Anything, even death, for some, is better than having no sense of identity. People are often
prepared to do almost anything to enhance or maintain their sense of identity. Threatening a
person’s social identity is a threat to their very self. We need to appreciate how early these
social identities, these identifications, are made. Studies have shown how patterns of
consumerist behaviour are already well anchored in young children.

Identity and Money

It is obvious how this affects our relationship with money. In modern society, our sense of
identity is often intimately tied up in the image we present to the world, an image that is
bought and sustained by money. Money becomes a fluid extension of our psychologies.
Unconsciously, we rely on it to fulfil our identifications. We scream in terror when we feel our
earning capacity and status are at risk. We need a careful process of transition into a new
sense of personal reality and identity.

Not to fulfil our sense of identity is a form of death; we can experience terrible psychological
pressure and distress. This distress can usually be felt physically, with headaches, general
pressure around the skull, a sense of light-headedness, near fainting, a sinking or gnawing
feeling in the stomach, a dry mouth and cold sweats. This is a universal psychological-
physical experience when we are faced with a real threat to our deepest sense of identity.

But there is also the opposite of anxiety and identity crisis. When we are successful, when
external realities match our inner sense of self, we experience great happiness and even
euphoria.

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Insomuch as our need to maintain identity is driven by a primal instinct and anxiety, this
completely influences how we relate to money, the medium that can gratify our primal need.
Our lives can be purely focused on achieving the mo ney to fulfil the lifestyle dictated by our
sense of identity. And we think it is completely normal.

Relative Deprivation

Bloom gives an example of tantrum of a young child who does not have the right clothes for a
party; this is not a spoilt child, it is the drama of a life-or-death threat to her psychological
survival. We need to appreciate the terrible unconscious power of internalising an identity
that other people have, but which we ourselves cannot financially afford.

In tribal society or within a coherent family there is a natural spirit of sharing and generosity
that takes care of individual’s needs – as well as natural, built- in mechanisms that prevent
power manipulation or material accumulation. In a complex society, disengaged from these
fundamental guidelines, where individual roles are complex, relative deprivation is normal.
Bloom even claims that one of the most consistent features of modern civilization is
relative deprivation. People live with competing images of wealth and poverty.

Psychological Pressure

Psychologically, the experience of deprivation and its threat to identity is shattering for
individuals, and destructive for communities. The issues of relative deprivation eat away at
individuals and at communities; disparities create immense psychological pressures. People
are born into a world which projects as normal for everyone a certain lifestyle and well-being,
but they are unable to live it. The dispossessed feel psychological confusion, anger,
disempowerment and emotional outrage. In its most dramatic form, it can lead to revolution.

Bloom believes that we need to appreciate that these powerful psychological dynamics run
through all of us. In today’s world, there are thousands of choices of social identity – and
most of them need money. Another similarity that binds us all together is that we always find
our behaviour perfectly normal, we never examine its validity or usefulness.

We are all linked by the bond of insecurity and anxiety, coming from the earliest woundings
we receive as children, when our basic needs are not met. It is quite a personal load which we
carry. It is also a social and political load, for these personal dynamics affect the attitudes and
behaviour of all of us in the real world.

Bloom also points out that next to the real, physical and immediate experience, there is also a
very interesting psychological dimension, which is about whether we feel rich or poor.
Psychological and inner wealth (or poverty) is distinct from material wealth (or poverty).
It is worth aiming for the psychological security and abundance, regardless of our actual
financial situation.

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Scarcity Mentality
Lynne Twist believes that, no matter how much we have, most of the humanity is caught in
the scarcity consciousness, in what she calls a constant mantra of ‘not enough’. We don’t
have enough money, enough time, enough love….

We live with scarcity as an underlying assumption. It is an unquestioned, sometimes even

unspoken, defining condition of life. It is not even that we necessarily experience a lack of
something, but that scarcity as a chronic sense of inadequacy about life becomes the very
place from which we think and act and live in the world. It shapes our deepest sense of
ourselves, and it becomes the lens through which we experience life. Through that lens our
expectations, our behaviour, and their consequences; our whole life becomes a self- fulfilling
prophecy of inadequacy, lack and dissatisfaction.

The World of the Hungry Ghosts

Kulananda and Houlder in their Buddhist view on money describe this scarcity mentality as ‘the world
of the hungry ghosts’ on the Buddhist wheel of life: the ghosts who are driven by intense neurotic
craving, a displaced desire for something else that they are not consciously aware of: “Hungry ghosts
are traditionally depicted as grey, emaciated beings with gross, sagging bellies and long, constricted
necks. They have huge, staring eyes; tiny, pinprick mouths; and their overall experience is one of
unfulfilled longing . The meagre fruit that grows on the spindly trees is almost always out of reach,
and when they do manage to pluck and eat one it turns to swords and daggers in their bellies.
Hungry ghosts can never get enough.“ (Kulananda & Houlder, 2002)

Twist argues that this way of perceiving lives at the very heart of our arguments with life:
what begins as a simple expression of the hurried life or even the challenged life, grows into
the great justification for an unfulfilled life. It becomes the reason we can’t accomplish the
goals we set for ourselves, the reason our dreams can’t come true, or the reason other people
disappoint us, the reason we compromise our integrity, give up on ourselves or write off
others. (Twist, 2003)

This mind-set of scarcity is deeply embedded in our relationship with money, which becomes
an expression of fear; a fear that drives us in an endless and unfulfilling chase for more, or
into compromises that promise a way out of the chase or discomfort around money. In the
chase or in the compromises we break from our wholeness and natural integrity. We
abandon our soul and grow more and more distanced from our core values and highest
commitments. We find ourselves trapped in a cycle of disconnection and dissatisfaction.

Twist claims that this mind-set of scarcity is not something we intentionally created or have
any conscious intention to bring into our life: “It was here before us and it will likely persist
beyond us, perpetuated in the myths and language of our money culture.” We do, however,
have a choice about whether or not to buy into it and whether or not to let it rule our lives.

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Myths and superstitions have power over us only to the extent that we believe them, but when
we believe, we live completely under their spell and in that fiction.

Most of us can probably to some extent identify with the mindset of scarcity that Twist is
talking about; I know I can. She believes that this scarcity consciousness, which is permeating
the minds of humanity, is the core reason for most of the problems we see in the world, such
as hunger or inequality in the world. Let’s take a look at what is her answer, her ‘formula’ to
address this problem.

Sufficiency
We all have life sentences embedded in our beliefs and our worldview. It is possible to rewrite
them and consciously rescript our responses to include the inspiration we need to ground
ourselves around money.

Twist suggests that we turn back to sufficiency; and sufficiency means reclaiming the power
of what is there: “When you let go of trying to get more of what you don’t really need, it frees
up oceans of energy to make a difference with what you have. When you make a difference
with what you have, it expands.” (Twist, 2003)

The three truths she proposes about sufficiency are:

1. Money is like water.

Money flows through our lives like water. When it is flowing, it can purify, cleanse, create
growth, and nourish. But when it is blocked or held too long, it can grow stagnant and toxic to
those withholding or hoarding it. Like water, money is a carrier, it carries the energy with
which we use it. It can carry our intention and commitment. We can take responsibility for
that flow. Money can express our soul.
Our power lies in knowing the flow: where does our money come from, and where does it go.
When we are conscious of the flow, we can direct the flow in accordance with our deepest
beliefs, which nourishes ourselves and the world. “You feel vibrant and alive when you use
your money in a way that represents you, not just as a response to the market economy, but
also as an expression of who you are.”

2. What you appreciate, appreciates.

Twist also reminds us of our power to choose where we direct our attention: when our
attention is on what is lacking and scarce, then that becomes what we’re about. The fears grow
from the attention we give them and can take over our life. If our attention is on the capacity
we have to sustain ourselves and contribute in a meaningful way to the well-being of others,
then our experience of what we have is nourished and it grows.
Even in ad versity, she says, if we can appreciate our capacity to meet it, learn, and grow from
it, we create value. She invites us to use our appreciation – our conscious attention and

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intention – to search for the best in people, organisations, world… “Look for what’s working
instead of what’s not and instead of negation, criticism, and spiralling diagnosis, there is
discovery, dream and design. ”
The seeds that grow are the seeds we tend with our attention.

The Power of Conversation

Twist addresses another important detail, explaining that “we live in our conversation about the world
and our conversation about the circumstances. … The conversation we have with ourselves and with
others – the thoughts that grip our attention – has enormous power over how we feel, what we
experience, and how we see the world in that moment.” (Twist, 2003)

Scarcity speaks in terms of never enough, emptiness, fear, mistrust, envy, greed, hoarding,
competition, fragmentation, separateness, judgment, striving, entitlement, control, busy, survival, outer
riches. In the conversation for scarcity we judge, compare, and criticize; we label winners and losers.
… We center ourselves in yearning, expectation, and dissatisfaction…. We let money define us, rather
than defining ourselves in a deeper way and expressing that quality through our money.

Sufficiency speaks in terms of gratitude, fulfilment, love, trust, respect, contributing, faith,
compassion, integration, wholeness, commitment, acceptance, partnership, responsibility, resilience,
and inner riches. In the conversation for sufficiency we acknowledge what is, appreciate its value, and
envision how to make a difference with it. We recognize, affirm and embrace. We celebrate quality
over quantity. We center ourselves in integrity, possibility, and resourcefulness. We define our money
with our energy and intention.

3. Collaboration creates prosperity

Collaboration and reciprocity are natural, and yet in the world we inhabit, competition and the
fear of scarcity often block us from seeing these ways of being with one another. Connections
forged in a mind-set of scarcity, no matter how strong they may seem in the moment, are
inherently self- limiting, they undermine our chances for long-term survival and sustainability.
The kinds of connections that truly protect and preserve us are those that emerge from the
context of sufficiency and the sharing, diversity, reciprocity, and partnership found there.
Twist quotes an indigenous saying, which I feel should be at the heart of all our relationships,
from ‘development help’ to friendships: “If you are coming to help me, you are wasting your
time, but if you are coming because your liberation is bound up with mine, then let us work
together.” What really works is when everyone is giving the assets or resources they bring to
bear to make a vision come true. Whatever they can contribute, everybody’s participation is an
equal asset.
The human hand must open to receive, but also to give and to touch. A human heart must also
open to receive as well as to give and to touch another heart. That openness and reciprocation
connects us not just to others, but to the feeling of fullness and sufficiency in ourselves.

53
How deep does it go?

The question that I feel we need to ask at this point is: is it really enough to change our own
personal perception from scarcity, ‘not enough’, to abundance – or do we have to look at and
think seriously about the bigger picture? From what I’m facing at the moment, the challenge
of shifting my own perception – not just about money but life in general – from one of ‘not
enough’ to appreciating what is there, I can say the problem is bigger than just personal. The
pressure I feel can be overwhelming and again and again I have to consciously bring it back to
my inner source and ground it in my integrity. And even when I do that, trying to live in this
consciousness seems like swimming against a powerful current.

Bloom explains this experience beautifully (Bloom, 1995):

“The inner world contains awesome forces related to money. This world has not been
illustrated in map form, but if it were it would be quite bizarre. It might resemble one
of those medieval maps – ‘Here be daemons, dragons and angelic beings.’ In this inner
world there exists, as a dynamic energy form around money, the accumulated anxiety,
fear, greed and manipulation created by humanity throughout its history. …
Movement is like wading through warm mud until we slip into some unknown chasm
of total fear, sucking us down into pain and despair.”

Bloom calls this ‘horrible extreme of the archetypal life of money’ the ‘Black Hole of
Anxiety’. Some people call it the ‘Money Elemental’. The power of our feelings towards
money does not come simply from within our own psychology. We are often feeling, or are
even captive to, the overwhelming atmosphere of the archetype. We ourselves create the
power of these archetypes by continuing to feed them with our mental and psychic energy.
(Bloom, 1995)

The argument becomes even stronger if we remember in which direction the world is going,
propelled by the money system. The answer would definitely be ‘yes’; we do have to look at
the bigger picture. We have seen in the previous pages how tightly money is linked with our
emotions and fears. As it is important to look at our money issues through psychological
approach on our personal level, it is equally important to take the psychological approach to
studying money issues on the collective level, which I will try to do next.

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6. INTEGRAL PERSPECTIVE ON MONEY
Bernard Lietaer made a very simple and clear overview12 of human knowledge about money,
based on the Integral Perspective model which was originally designed by Ken Wilber.
Wilber’s holistic model is a map of the whole of human knowledge, a map including all fields
of knowledge. The model is composed of four fields, as presented in the diagram below:

Interior Exterior

A B
Personal meaning Body and
and sense of self interpersonal Individual
behaviours
(“I” - Intentional)
(“IT” - Behavioural)

D C
Culture and Institutions,
shared values systems and processes, Collective
nature
(“WE” - Cultural)
(“ITS” - Social)

The fields of knowledge are classified by two criteria. The upper part of the model represents
the individual level and the bottom part the collective level. The left hand side represents
interior processes (interpretation of meaning) and the right-hand side exterior processes
(description of behaviour). All these fields are interconnected and each of them has a piece of
reality, but none of them has the whole of it.

The fields of knowledge as organised by this model are:

- A: spirituality, individual psychology
- B: physics, biology, empiricism, behaviourism…
- C: economics, political economy, systems theory, social systems
- D: sociology; cultural history, collective psychology, evolutionary psychology

12
What follows, including most of the diagrams, is based mainly on the lectures given by Bernard Lietaer during
the 'Future of Money' course at Schumacher College in January 2006, occasionally supported with information
from his books and writings.

55
When we apply this grid to human knowledge about money, we get a model of Integral
Perspective on Money, mapped by Lietaer:
- A: personal emotions and assessments about money (my interior issues with money)
- B: personal behaviour around money: earning, investing, giving
- C: monetary systems (coordination of action with others about money)
- D: collective beliefs (archetypal dimension of money)

Interior Exterior

A B
My Interior Issues My Behaviour
With Money Around Money Individual

(personal emotions (earning, investing,

and assessments) giving money)

D C
Archetypal Dimension Money Systems Collective
of Money
(coordination of
(collective beliefs action about money)
about money)

Knowledge about Money

Looking at this map of the whole of humanity’s knowledge about money through these criteria
we notice that most of the research and literature is in the field of individual exterior, our
individual behaviour around money: how to earn, invest, even how to give money away.
Lietaer even estimates 95% of all research/literature to be in this quadrant.

The sphere of the ‘upper left quadrant’, individual interior – our interior world in relation to
money – started to be explored in the past few decades. This is the realm of human psyche, our
emotions and values, and only recently we have started to look at money from the perspective
of psychology. Nowadays it is obvious that our psyche, our internal world and how we make
meaning of our lives affects our behaviour on an individual level. Despite the assumption of
‘homo oeconomicus’ that was valid for quite a long time, and which presupposes man

56
behaving as a rational and self- interested actor, we now know that our behaviour stems from
our feelings. When we feel good, we buy presents for our friends, when we feel bad, our
clothes suddenly don’t feel right, we need to go shopping to fill the emptiness inside.

Specialised professional literature looks at monetary systems, which we find in the lower right
quadrant, the sphere of collective exterior. But economic theory assumes a monopoly of
‘national money’, and almost all the professional research on monetary systems remains
within the box of this existing system. And when we keep our focus on one thing we are
almost blind to any other possibilities.

What about the interior collective level? Psychology deals mainly with the individual sphere,
but although money affects us individually, it is a collective phenomenon. Money, by its very
definition13 , can only exist within a community. And when Beckham’s goal at the World Cup
provides a 100 million pound boost to the economy (see box), we are looking at an important
psychological phenomenon. Still, amongst the people who work in the domain of money and
economy on a national and global scale, almost no attention is given to the importance of this
fourth quadrant, our collective beliefs about money. These have an important influence on the
world we live in, but they remain almost unquestioned.

The Feelgood Factor

Front page article with that title in The Independent on Monday, June 26, 2006, after England qualified
for quarter-finals in the World Cup, states that “according to analysts, such as the Centre for Economic
and Business Research, at least an extra £100m will be spent in the UK in the six days before the
quarter-finals on Saturday.”

The British Retail Consortium – which predicts a windfall to business of £1.5bn from the four-week
finals – believes an extra £124m will be spent on food and drink for every week England stays in the
tournament. It is estimated that half of the total spending for the tournament was lavished before the
opening match, on everything from football merchandise to advertising campaigns. Sales of high-
definition televisions have trebled. Pubs, clubs and bars benefit most from England’s participation in
the World cup. “People are happy, they will stay in clubs and pubs to celebrate more.” Beckham’s goal
was also estimated to be worth up to £50m in turnover to the gambling industry.

The article, accompanied with photos of deserted roads during the match, quotes a study from the bank
ABN Amro, saying that the GDP of the World Cup victor is boosted by an average of 0.7 per cent.

Can we still believe in the concept of homo oeconomicus, man as a rational consumer? Can
we go on believing in a predictable world that we can control and prepare for? Maybe we can

13
Lietaer’s definition of ‘what money is’ (instead of money being explained by its functions, by what it does)
specifies money as an agreement, within a community, to use something as a means of payment – for more
details see Chapter 1.

57
predict that behaviour of people will be irrational, but we can hardly predict how a football
team will perform. We can only begin to consider all the factors that would influence it.

Mutual Causality

All these four fields that Wilbur mapped are interconnected and they influence each other. In
Western society we are mainly still thinking about the world within the frame of linear
causality, cause and effect. But we live in the world of mutual causality – in Buddhism also
called dependent co-arising – phenomena arise together in a mutually interdependent web of
cause and effect. There is mutual influence between all these spheres of life.

There is mutual influence between the individual and collective; we are both a product of
society and create it. And there is mutual influence between the internal and external: we
interpret the outside world according to what is already inside us and vice versa, we project
outside what is inside us. The latter is perhaps still more obvious on the individual level than
on the collective – a reason more to put even more attention on the collective processes.

At this point it is worth pa using for a while and considering, what is it inside us, what are we
projecting outside – and asking ourselves, is that what we really want in the world? Perhaps
we should think about what we do want, and then bring that forward consciously. Jung
believed that “it is a function of consciousness not only to recognize and assimilate the
external world through the gateway of the senses, but to translate into visible reality the world
within us.” (Lietaer, lecture)

On the collective level this mutual causality means that our collective beliefs shape the
economic system we have, and that our collective beliefs about money shape the type of
money system we have. Money systems are manifestations of the collective beliefs of a
society – and in turn, money systems shape individual and collective behaviour. We could
even say that the money problem that we looked at in the first chapter is in our heads, and we
project this existing money system from our heads. We will look a little later at Lietaer’s
proposition about where this is coming from.

Unconscious Automatic Pilot

Money is still almost a taboo in our society: in our personal lives that shows as reluctance to
talk openly about money; it is impolite to ask people how much money they have or make and
where it is coming from. Often partners don’t know each other’s financial situation or keep
some money hidden from the other, ‘just in case’. And a lot of people even experience
uneasiness looking at their own finances and making well- informed decisions about it.

On the collective level this ‘blind spot’ can be perceived in general ignorance and lack of
questioning and understanding of systemic issues around money, the issues we looked at in
the previous chapter. Not many people realise the consequences of the money system we have.
Lietaer estimates that only a fraction of human population is aware of these problems.

58
Money issues are buried deep in the unconscious, on the individual and even more so on the
collective level. If we use Bernard’s poetic words: like water to fish, money is ever-present in
our lives, but rarely noticed and little understood.

Lietaer proposes that:

“The kind of money used in a society is both a reflection and reinforcement of that society’s
collective unconscious. Every society has considered its own money as self-existing, innately
valuable, and self-evident, whether money takes the form of stones, pieces of metal, or bits of
colourful paper.
Such unquestioned transparency is the very signature of a collective unconscious process.”
(Lietaer & Belgin, 2006)

Collective unconscious behaviour patterns are forming the money system we have. On the
other hand, the money system we have is feeding, on unconscious level, the collective
behaviour patterns of society. But there is no active feedback ; no collective systems are
consciously and systematically engaging with and changing our collective beliefs about
money! We are driving on automatic pilot!

A fact is that money system causes and influences emotional patterns. Emotional patterns are
predispositions for action and they result in different behaviour patterns. We have observed
some of the behaviour patterns, stemming from the money system we have, before.
Consequently, as we have seen, the money system influences every other one of our systems:
education, economics, religion etc.

What is hidden in the unconscious realm in respect to money spreads out into the world and
has an effect on almost every aspect of our lives. Let’s take a closer look at this unconscious
realm.

Going Upstream
The fundamental proposition is that we project the money system from our heads and that the
money problem we observed earlier is in our heads. Lietaer made an attempt to bring into
consciousness the current that is hidden under the surface, in the collective unconscious.

The long view reveals the energies that have been influencing our society for millennia:
- 1950 to 2000: 50 years of cold war
- 1750 to 2000: 250 years of industrial age, which is an expression of the modernist
worldview (i.e. man as active, controlling component shaping the world)
- 1500 to 2000: 500 years of what he calls the ‘modernist’ worldview, explained above
- 500 BC to 2000 AD: 2500 years of hyper-rationalist thinking
- 3000 BC to 2000 AD: 5000 years of patriarchal society

59
All these cycles, carrying active, dominating, rational, masculine energy, are feeding each
other. Longer waves embrace, direct and feed shorter ones.

Lietaer argues that the very thing that ties these waves to today’s crisis in the world is the
mainstream patriarchal mo ney system. He asserts that:

“The driving force is coming from patriarchal values and the type of money we have nowadays is the
strongest reinforcer of patriarchal values.” (Lietaer, no date)

As we have seen before, in Western history a monopoly of currencies that play simultaneously
the role of medium of exchange and of store of value emerged. These currencies initially
consisted of scarce and precious commodities of various kinds, later evolved into gold and
silver coins and finally into centrally controlled national currencies.

The common feature of all these systems is that they actively encourage savings in the form of
accumulation of money by providing an interest income from money savings. This kind of
money is concentrated by relatively small elite, and consequently the available medium of
exchange is scarce for a significant segment of society. Interest rates also encourage short-
term vision in investment. (Lietaer, no date)

Yang and Yin Money

According to their characteristics, Lietaer proposes to call these currencies that evolved in
patriarchal societies ‘Yang’ currencies. He argues that our conventional money is definitely an
extreme Yang construct :
- it is created by a global hierarchy, where developing countries don’t have a chance at
influencing the rules;
- it is enforced at the national level through a hierarchy under the authority of a Central
Bank;
- interest feature encourages accumulation and concentration of wealth;
- scarcity of money promotes competition among its users.

Lietaer uses the concept of Yin and Yang to describe different kinds of money that have co-
existed in many societies in the past and still do. A concept, he explains, which does not have
an equivalent in the Western world, represents the ‘union of opposites through the middle
path’ (Lietaer, 2002).

By using the term ‘yang’, Lietaer is not judgmental; he is not saying that our national money is
bad. The expression he is using explains the quality of money today. At the same time it also
indicates that that is just a part, a half; that there is another, complementary ‘side’ to it and
that both are necessary.

60
Yin and Yang

The concepts of yin and yang originate in ancient Chinese philosophy, which describes two primal
opposing but complementary forces found in all things in the universe. Everything has its opposite –
although this is never absolute, only relative. No one thing is completely yin or completely yang. Each
contains the seed of its opposite. One cannot exist without the other. (Wikipedia, 2006)

YANG (sunny) YIN (shady)

active passive
light dark
masculine feminine
happy sad
upward-seeking downward-seeking
corresponds to the day corresponds to the night
symbolised by fire symbolised by water

All money systems facilitate exchanges among people. Lietaer argues that, given the
remarkable motivating power of money, different currencies tend to foster different values and
attitudes. The type of money used in a society and the way money is created and
administered deeply moulds values and relationships within that society. It is encouraging or
discouraging specific collective emotions and behaviour patterns. (Lietaer, 2002)

As we have said, patriarc hal societies have imposed monopolies of scarcity based,
centralizing yang currencies, which are issued by a central authority. Such currencies promote
boom and bust cycles, concentration of wealth, unsustainability and they destroy community.

So what wo uld complementary, Yin type of money be like? Lietaer believes that these types of
currencies already exist and are increasingly emerging all around the world:

Complementary currency is an agreement within a community to create its own currency to

link unmet needs with unused resources. These currencies do not replace but rather
supplement the national monetary system and provide greater functionality to money. Often
they are created in a process of mutual credit, which is a process of creating money by
simultaneous debit and credit between participants in the transaction. These systems are self-
regulated to always have currency available in sufficiency. (Lietaer& Belgin, 2006)

Yin currencies are so called ‘common tender’; they are generated within the community, on
an egalitarian basis, created through an un-centralized and democratic process and they foster
cooperation. They can’t be accumulated and stored like conventional money and they can be
in sufficiency. Lietaer calls them ‘complementary currencies ’, as opposed to the term
‘alternative money’, suggesting that they complement rather than replace regular money.

61
The two most known forms of mutual credit systems are:
- LETS (Local Exchange Trading System).
- time bank; a mutual credit system with ‘hours of service’ as the unit of account.

Lietaer made a schematic map of Yin and Yang currencies, which remarkably overlaps with
the Tai Chi symbol. A more thorough study of complementary currencies can be found in
Lietaer’s The Future of Money.

Yin and Yang Coherence

Lietaer made an attempt to integrate the Taoist vocabulary of Yin-Yang into economic
systems, to help us think in more holistic ways. He proposes that humans create coherence:
they feel, think and perceive realities according to the coherence in which they live. He
made a list of some aspects of these Yin- Yang coherences (see next page). They can be read
vertically to see each internal coherence, or horizontally to grasp what the Taoists would call
the connective contrast between the two worlds. (Lietaer, 2001)

He claims that modern societies have tended to acknowledge the legitimacy of only one of
these polarities: the Yang coherence. This Yang coherence has been embodied in a
patriarchal control system in all aspects of life, from organized religion to science, from
military power and politics to day-to-day jokes. Specifically, our prevailing money system is
saturated with these Yang values and has been one of the main ways by which ‘the real
world’ has been made to fit this viewpoint.

62
Lietaer is not questioning the validity of this Yang coherence, but its claim to a monopoly of
valid interpretations. Instead, he is proposing to take both concerns into account
simultaneously; for example, he points out that sustainability is coherent with the Yin
coherence, while abundance is Yang.

Yin and Yang Coherence

YANG YIN

Transcendent God Immanent Divinity

Pursuit of Certainty Ability to hold Ambivalence
Central Authority Mutual Trust
Hierarchy works best Egalitarian works best
Competition Cooperation
Rational, Analytical Intuition, Empathy
Logic, Mental, Linear Paradox, Physical-emotional,
Cause and Effect non linear
Parts explain Whole – Synchronicity
Reductionism Whole explain Part – Holism
Bigger is Better Small is Beautiful
Technology Dominates Interpersonal Skills dominate

Dual Economies
Lietaer explains that in the civilizations where Yin, the feminine energy, has been honoured,
two complementary monetary systems have appeared. One of these currencies operated only
as means of payment and exchange but not as a store of value, which actively discouraged
accumulation of wealth in that currency. These currencies would circulate freely in all levels
of society and always be available even to the lowest economic classes. This enabled them to
engage in transactions that significantly improved their standard of living.

People who used these currencies would still save, but in the form of investments in
productive assets, not by accumulating such money. Consequently, the long term vision in
investments was emphasized (Lietaer, no date).

He explains that matrifocal societies use two complementary Yin-Yang money systems;
Yang money for long distance transactions and Yin money for local exchanges. This
promotes economic stability, general well-being for the little people, sustainability, and it
helps build community.

63
Matriarchal or Matrifocal?

Matrifocal is a term that Lietaer uses for a society whose social reward system and mythology honours
the feminine as well as the masculine. There are many examples of such societies.

He makes a clear distinction from matriarchal society in which the official governance system would
exclude men from power. It appears that this is a mythical form of society for which no archaeological
or historical evidence has been found. (Lietaer & Belgin, 2006)

Lietaer studies two historical cases of such dual economy, the only two examples about which
we have enough evidence on both their money systems and investment patterns: Dynastic
Egypt and Central Middle Ages in Europe. Both economies and cultures are presented in his
Mystery of Money as well as Of Human Wealth in great detail.

Demurrage vs. Interest

Both economies used a sort of a ‘demurrage14 ’ system. Demurrage charge is a time-related

charge on money, for example a 5% annual demurrage charge on £100 incurs a £5 fee, leaving
a remainder of £95.

Demurrage has two profound effects (Lietaer & Belgin, 2006):

- Saving in the form of accumulating such currency is discouraged, which promotes
circulation of a currency. People will either spend or invest it. The functions of the
‘medium of exchange’ and ‘store of value’ are separated.
- Other kinds of savings are encouraged, such as investments in productive assets; land
improvements, maintenance of equipment and similar. These currencies encourage
long-term thinking.

We already mentioned Egyptian storing of wheat and receipts for it being used as money.
This money was losing value with time. The money system was tied to the real world , in
which the value of stored wheat would decrease due to spoilage, and in which costs of storage
had to be covered.

During Central Middle Ages demurrage charge occurred due to the practice of recoinage ,
which we also mentioned in the first part, when rulers would call in all coins and recoin them,
exchanging for example 3 new coins for 4 old ones of the same face value. The profit the lords
made from this process is called seignorage. Customarily this ‘Renovatio Monetae’ would
happen every five or six years or, when a local lord died, his successor would recall old

14
The origin of the word is dating back to the railroads’ practice of charging a fee for leaving a railroad car
inactive.

64
coinage and issue his own new one. Whoever was in possession of such coins therefore had to
pay 25% tax at the time of recall. It was therefore better to spend or invest them rather than
accumulate them.

This system broke down when ‘debasement’ started to be implemented, replacing demurrage.
Debasement is a process in which the precious metal content of a coin is significantly
reduced, enabling the issuer to make more coins from the same amo unt of precious metal. The
main advantage to the ruler is that the debasement is not immediately visible – but the process
results in inflation and the tax the ruler collected is hidden, ‘stealth tax’. (Lietaer, 2006)

Both Egyptian civilization as well as Central Middle Ages are known as periods of general
well-being and the cultural monuments built in those times, such as pyramids and cathedrals
are still present and well preserved today. Lietaer proposes that their money system was one of
the main reasons that enabled the blossoming of economy and culture in those times.

Emergency Currencies

Lietaer points out that in 1930s many ‘emergency currencies’ arose in response to the
aftermath of the German hyperinflation of the 1920s and the economic crash of 1929 in
Western Europe and North America (Lietaer & Belgin, 2006):

In Germany, in the mining town of Schwanenkirchen, ‘Wara’ was a currency backed by the
coal they were extracting, with which workers in the mine were paid. In the end, the whole
community was using this alternative money, which had a small monthly stamp fee –
demurrage tax. The fee ensured that this money would circulate and not be hoarded.
Threatened by its success however, German central bank with help of the government had the
Wara declared illegal. Money became scarce again and many businesses had to close, which
resulted in unemployment.

In Austria we come across a similar example, the famous case of a little town Wörgl. The new
major of the town had a long list of projects he wanted to accomplish, and a lot of willing and
able people to do the work – but he did not have money to realise his ideas. He put the little
money that he had on deposit with a local savings bank as a guarantee for issuing Wörgl’s
own complementary currency. The currency included a demurrage-charged relief tax which
acted as an incentive to keep the currency in circulation. This tax was applied through a stamp
that needed to be affixed each month at 1% of face value. Some people even decided to pay
their taxes early, to avoid paying the fee.

The extra money in circulation automatically provided work for others. This fast circulation in
fact ensured that every Wörgl stamp scrip created eight times more employment than normal
shillings. Wörgl became the only town in Austria with full employment and other villages in
the neighbourhood started copying the system. Soon it was 200 other towns that wanted to
copy it, at which point the Central bank started panicking and asserted its monopoly rights: it
became a criminal offence in Austria to issue ‘emergency currency’. Unemployment in Wörgl
soon rose back to 30%.

65
The success of Wörgl caught attention of the US policy makers during the Great Depression of
the 1930s, when they were struggling with unprecedented unemployment. Irving Fisher, a
Yale economics professor, professor Russel Sprague from Harvard and Dean Acheson, the
undersecretary of the Treasury all became convinced that this model was a way out of the
depression. Fisher stated that “The correct application of stamp scrip would solve the
Depression crisis in the United States in three weeks.” Unfortunately, the idea, presented to
President Roosevelt, was rejected. (Lietaer & Belgin, 2006) Perhaps the idea implemented
would have resulted in a different world than the one we know today?

To summarize this extensive study of currencies: we have seen that different money systems
generate different emotions and they shape different behaviours. “That is why to truly
understand how money shapes society ‘out there’ we need to understand how it connects to
our own psyche, or the life ‘in here’.” (Lietaer & Belgin, 2006)

Money as Symbol

In The Dictionary of Symbols 15, money is placed in the Feeling side of life, seen as the archetype of
Value : “From being a useful intermediate commodity, that facilitated human relationships and
reckoning, money – because of the contamination between symbols and reality – has all the symptoms
at present of being an irrational compulsion, arising directly from the neglected feeling side in the
unconscious, which therefore manifests negatively in a fairly widespread social way.”

And further: “Whole societies are driven and compelled by ‘economic pressures’ that are involuntary
and irrational. The symbolic solution is always the same and would require dissolving hardened
conscious criteria, in order to assimilate and integrate the unconscious, in this case the feminine
feeling side of life , including inward values, and extravert relationships.” (Chetwynd, 1993)

The tool Lietaer uses to study our collective belief patterns and emotions is archetypal
psychology.

15
The dictionary is compiled from the works of psychologists and others who have devoted their lives and
energies to unravelling the relationship between symbolism and the working of the human psyche, such as C.G.
Jung, Emma Jung, James Hillman, Liz Green and others.

66
7. ARCHETYPAL PSYCHOLOGY
I have proposed that there is mutual causality between the interior and exterior world, on an
individual as well as on a collective level. Money is an agreement, and it lives in collective
psychology. Money systems are a manifestation of the ‘collective interior’ sphere of a society,
and in turn they shape individual and collective behaviour. On the other hand, each society
tends to accept its money system unconsciously, as self-evident.

To explore collective psychology and group emotions, Lietaer decided to use the field of
archetypal psychology, which was pioneered by C.G. Jung.

Jung's theory divides the psyche into three parts (Boeree, 1997). The first is the ego, which
Jung identifies with the conscious mind. Closely related is the personal unconscious , which
includes anything which is not presently conscious, but can be. The personal unconscious
includes both memories that are easily brought to mind and those that have been suppressed
for some reason. But it does not include the instincts that Freud talked about.

But then Jung added the part of the psyche that distinguishes his theory from others: the realm
of the collective unconscious. It is the reservoir of our experiences as a species, a kind of
knowledge we are all born with. And yet we can never be directly conscious of it. It influences
all of our experiences and behaviors, most especially the emotional ones, but we only know
about it ind irectly, by looking at those influences.

Edinger explains that the contents of the unconscious are first encountered as complexes. A
complex is an emotionally charged unconscious psychic entity made up of a number of
associated ideas and images clustered around a central core. On investigation, this core is
found to be an archetypal image. (Edinger, 2002-2006)

Archetype is an unlearned tendency to experience things in a certain way. The archetype

has no form of its own, but it acts as an ‘organizing principle’ on the things we see or do. It is
like a black hole in space: you only know its there by how it draws matter and light to itself.
Jung also called archetypes dominants, imagos, mythological or primordial images

67
Most simply put, Lietaer describes an archetype as a pattern of emotions and actions which
can be observed across time and culture. Archetypes are primordial, universal energy
patterns, which developed over time and which inform our behavioural patterns and attitudes.
They exist within the deeper levels of both the individual and collective human psyches and
are found in myths, symbols, dreams, art etc. Archetypes cannot be known through intellect
alone.

When an Archetype is repressed, it manifests as a shadow. The Archetype’s energy, if

repressed, can manifest in two shadows: one represents the repressed archetype’s
characteristic in excess and the other in deficiency16 . Some people tend to act out the excessive
shadow, others the deficient one. The connection between the two shadows is fear.

Fear is usually a normal, healthy emotion, but when an archetype is repressed, fear
becomes permanently frozen and embodied in the individual – or collectively in society –
that has rejected it.

Quaternio Model
Robert Moore and Douglas Gillete proposed a map of the human psyche, based on Jung’s
Quaternio: four of the major archetypes found in all cultures. Each Archetype is like a face
we have, with certain qualities. These four archetypes represent four qualities: intention
(Warrior), compassion (Lover), wisdom (Magician) and presence (Sovereign).
Each Archetype has a mature expression and a bi- polar immature shadow.

Each of these archetypes is active both at the individual and collective levels. Similarly, the
shadows can manifest on an individual, but also on a societal level, when an archetype is
culturally repressed.

1. The Sovereign (King/Queen) – blessing and supportive

Is the integrating force at the core of the psyche; it integrates the Sun and the Moon, masculine
and feminine. The Sovereign is androgynous, integrating the energies of both the King and the
Queen. When healthy, it mobilizes, accepts and integrates the forces of all other archetypes –
and makes the necessary sacrifices for the good of the whole. The mature sovereign leader is
responsible and maintains healthy self-esteem. He or she makes choices that are in the best
interest of those the sovereign leads, provides direction towards goals and empowers others.
The mature sovereign will also experience joy, passion and vision.

When repressed, The Sovereign’s two shadows are:

16
Lietaer proposes that the concepts of Yin and Yang can be applied to the deficit and excess aspects of shadows.
Deficit aspects can be understood as Yin shadows, while excess aspects can be seen as Yang shadows. (Lieataer
& Belgin, 2006)

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 - Tyrant (Yang shadow): is dictatorial, self-centred, doesn’t have to explain, doesn’t
have to return calls, makes decisions that are in his own best interest
- Abdicator (Yin shadow): fails to demonstrate leadership, misses deadlines, fails to
properly prepare

Integrated Sovereign is not afraid to be tough when he needs to be and is not afraid to appear
weak. On the collective level this is the sphere of government.

2. The Warrior – strong and protective

Masters discipline, asceticism and force. The Warrior is the one that creates and maintains
borders, protects what needs protecting and gets rid of that which is unnecessary. He/she
destroys what needs to be eliminated, to enable the blossoming of new life. Warrior energy
helps you do what you need to do. The mature warrior serves a purpose higher than self.

The characteristics of the Warrior archetype are vitality and alertness. They are clear-eyed and
focused. They have unconquerable spirit and courage and willingness to show up for the task,
to do what is necessary. The Warrior is known for concentrated, striving will, which can be a
powerful force for good, when he is mature. In its mature form, the Archetypical Warrior
allows a person to be tenacious and to experience anger at injustice. It helps a woman
consolidate an independent self in defining and defending legitimate psychological
boundaries.

Warrior’s shadows are:

- Sadist (Yang shadow): is ruthless and violates the boundaries and rights of others; is
sarcastic, disrespectful, bullies others; will use unethical means to win, values and
morals are not significant
- Masochist (Yin shadow): allows others to intimidate him/her and violate his or her
boundaries

In society The Warrior appears in the spheres of military and business.

Lietaer stresses that an uninitiated or immature Warrior, without the loyalty and love for an
ideal higher than himself, becomes a dangerous and potentially destructive element in society.

Money and Spiritual Warrior

Bernice Hill, in her book ‘Money and Spiritual Warrior’ (2004), is exploring the theme of the Warrior
archetype in the context of money and wealth. She believes that the archetypal energy dominating our
culture right now is the destructive energy of the unhealed, immature side of the warrior archetype and
she claims that American culture was born from the blood and bone of this archetype. “Those who
founded this country often arrived with nothing except the warrior energy of survival. This warrior
energy would infuse our na tional culture from then onward.”

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She argues that a focus on money, wealth and materialism was at the heart of this archetypal energy
field from the beginning: Columbus arrived hoping to exploit the riches of India. The subsequent
history was laced with wars to seize the land from its inhabitants. Domination by the wealthy over a
small middle class, slaves and poor whites was the norm.

She also paints a picture of a modern version of the warrior : “man or woman, likely wears a business
suit, works in the stock market or is setting up a consulting firm. When healthy and mature, they have
the potential to be a powerful force for good. Their concentrated will has demonstrated itself in an
explosion of economic and material well-being.” But, as said before, unfortunately the dominating
archetypal energy today is the destructive energy of the immature Warrior. (Hill, 2004)

Hill also summarizes the esoteric writings of the Arcane School, speaking of our millennia as
the time when there will be a coming together of the dualities of masculine and feminine: “The
esoteric writings also note that the early years of our current epoch will be marked by the
feminine archetype infused with a powerful will. In a remote valley in the Himalayas, old wise
ones meet each year in May (‘vesak festival’) to meditate and receive the new energies
believed to be bathing the planet. … They say that the energy, which is pouring in at this time
is that of “the feminine warrior”. She is coming with vigor, for the old structures must be
dissolved and the balance between the sexes restored. The quality that this strong feminine
warrior carries is that of “compassionate power”, an essential aspect for our new world.” (Hill,
2004)

3. The Magician – wise and intuitive

The Magician masters knowledge and technology in the material world (through crafts,
science, technologies) as well as in the immaterial worlds (shaman, healer, priest or priestess),
or the connections between the two worlds (alchemists, Magus). This Archetype contains
knowledge and competency. The mature magician is introspective and aware, constantly
acquiring new knowledge. It has the capacity to raise and contain power, to heal and act as
mediator between human and divine spheres.

The immature magician uses knowledge to manipulate others, or, in lacking moral courage,
pretends ignorance.

The Magician’s two shadows, with mythical17 figures that Bernard Lietaer attributed to them
(see box), are:
- hyper-rational (Yang shadow): Apollonian
- chaotic (Yin shadow): Dionysian

17
Myths should be understood in a collective psychological sense, not as some hero ’s or god’s story. They
represent powers that have been common to the human spirit forever, and that represent that wisdom of the
species by which man has weathered the millennia; Lietaer quotes from and explains Campbell. (Lietaer, no date)

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This is the sphere of science and religion.

Apollo and Dionysius

are the two favourite sons of Zeus and represent the two polarities of the interplay between rationality
and irrationality (Lietaer, 2005):

Apollo was the solar God of prophecy and divination: the bright and shining one. He had no
childhood, he grew to full adulthood in only a few days because Themis, goddess of law and order, fed
him pure nectar and ambrosia. He never had any successful love affairs and had no feminine partner.
He took over the oracle of Delphi (sanctuary to the Gaia goddess) by the power given to him by
‘superior knowledge’. Thereafter the male Apollonian priests controlled the priestesses, who were
making the most famous prophecies in the Ancient world – Apollo was usually invoked whenever the
most awesome characteristics of the old Goddess of the Earth were made manifest, to complement and
to oppose the chthonic forces. Apollo was a god of authority in general and of authority over the
feminine in particular.

Apollo’s arrow kills from a distance, he was the one who destroys from afar. His emotional attributes
are: he is always emotionally distant, unaffected by the damage he may create. Apollo rejects whatever
comes too near him: he remains remote, unemotional, hyper-rationa l and has no introspection
whatsoever. His own emotional pain is always handled by distancing himself from feelings through
intellectual abstraction. He can live in the future and keep his objective stance with superb
indifference.

Dionysius was the god of ecstasy and terror, of wildness and the most blessed deliverance. He did not
fare well under Christian influence and they transformed him into the devil. He was initially brought
up as a girl and the dark moon goddess Cybele taught him her mysteries and initiation rites. He is the
only Greek god who rescues and restores women representing goddesses, who had been diminished
earlier in Greek mythology. Paradoxically he is also the only god in Greek mythology that remained
faithful to his wife Ariadne, the Goddess of vegetation, by which Dionysius became associated with
vegetation, the vineyard, fruit, spring renewal and sexual fertility. His attributes are plants, vine and
wine. All consciousness altering and psychotropic experiences are part of his preserve.

Two types of Dionysius’ emotional attributes are:

- eternal child (Puer Aeternus); as the divine child carrying innocence, he easily escapes
materiality; is a dreamer and enthusiast, who gets so completely absorbed in his emotional space
that everything else disappears from consciousness (flower children)
- Pan, frenzied orgiastic god , chaotic dissolution of repressions; he forces anybody who holds on
too tightly to let go, by choice or by death. It was Dionysius who granted King Midas’ wish to
transform anything he touches into gold. He is an archetype of extremes, of intense opposites:
ecstasy and horror, total union and complete dissolution; exuberant life and horrible death. Adult
Dionysius knows no boundaries, no social or other constraints.

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 4. The Lover – loving and connecting

The Lover masters play and display, sensuous pleasure without guilt, he is sensitive to art and
beauty. The Lover dissolves barriers. He has the power of empathy and connectedness to other
people and everything else. The mature lover is compassionate, passionate, creative, awake,
connects with others and is profoundly spiritual. In addition, the mature lover maintains
healthy sexuality and appropriate sensuality.

Lover’s shadows are:

- addicted (Yang): does not set appropriate boundaries
- impotent (Yin): refuses to take risks and make tough decisions

In social life this is the sphere of the arts.

Archetypes and the Ways of Knowing

Tom Daly, coach of the ‘4 Gateways’ programme, links these four archetypes to the four
ways of knowing. They embody the four wisdoms, four basic modes of the human soul to
access wisdom. Daly defines a gateway as an entry or portal from one place to another.

We step through 4 different gateways to experience our lives and any problems, conflicts, and
issues we are working with we approach from four different perspectives:

- Magician; thinking wisdom:

Getting perspective, generating options
Thinking critically, using analysis, logic, and intuition
Judging and making assumptions
Getting and organizing information
Creativity and imagination

- Lover; feeling wisdom:

Feeling and connecting
Empathizing and loving
Accessing bodily awareness and emotional intelligence
Playing and being spontaneous
Making music, dancing, making art

- Warrior; doing wisdom:

Taking action
Serving and protecting, setting boundaries
Using power, working with conflict
Street smarts
Team work

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- Sovereign; being wisdom:
Setting direction and motivating
Making choices from deep knowing
Giving support and blessing
Defining purpose and meaning
Seeing the whole, knowing rank and order

Daly stresses that the gateway we have least access to often becomes the best place to look
for solutions. That ‘weakest link’ often becomes the key to coming to a new awareness and
creating a satisfying resolution; a door to the soul.” (Daly, 2004)

Jung’s Functions

Daly’s concept slightly differs from Jung’s mandala of the functions we use to deal with the world.

Jung suggests there are four basic ways, that we use to deal with the world – inner and outer – ways we
are comfortable with and good at (Boeree, 1997):

Sensing means getting information by means of the senses. A sensing person is good at looking and
listening and generally getting to know the world. Jung called this one of the irrational functions,
meaning that it involved perception rather than judging of information.

Thinking means evaluating information or ideas rationally, logically. Jung called this a rational
function, meaning that it involves decision making or judging, rather than simple intake of information.

Intuiting is a kind of perception that works outside of the usual conscious processes. It is irrational or
perceptual, like sensing, but comes from the complex integration of large amounts of information,
rather than simple seeing or hearing. Jung said it was like seeing around corners.

Feeling , like thinking, is a matter of evaluating information, this time by weighing one's overall,
emotional response. Jung calls it rational, obviously not in the usual sense of the word.

Although every individual has all four functions potentially at their disposal, in actuality one function
is usually more fully developed than the others. This is called the superior function. The one least
developed is the one that is most primitive and unconscious - the inferior function.

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The Missing Archetype
Based on his thorough study of money and money systems throughout history, Lietaer
proposes that there is an archetype which has been overlooked and repressed for millennia. He
expanded the Quaternio Model, adding the fifth archetype:

5. The Provider (also known as Great Mother)

The Great Mother archetype is associated with nature, material abundance and bountiful
embodiment of the earth. She holds the mysteries of life and death, sexuality and fertility. She
represents all that gives us sustenance, including money, which is connected to our survival
and nurture. The archetype represents feminine values and aspects in nature, in each of us
individually and in the whole of humanity.

The Greek Divinity personifying the Earth was Gaia. 18 In South America in the Andes a cult
of the Pachamama still survives. The name comes from Pacha (Quechua for change, epoch)
and Mama (mother). In Indian religions, the Mother of all creation is called "Gayatri", a
surprisingly close form of Gaia.

Money and Nature

Bloom believes it possible that in our separation from nature we have transferred our natural
and primal fear of her and her powers on to money and the economy. Money and the economy
have replaced nature in our biological unconscious. Nature, of course, still feeds us, but not
through response to our own direct labour. Between us and nature are a thousand producers,
distributors and retailers.

When our relationship with nature was direct, there was no ignoring her power. Slowly,
through history, we have conquered nature; she is beneath our threshold of consciousness, and
we have lost the sense of awe, vulnerability and proportion.

Yet, in our cells, in our biology and our unconscious, he believes that we still carry that natural
sense of awe and fear. But for what shall we feel it? In reality, money mediates between us
and nature. Our vulnerable relationship is now with this other creature, the economy. Nature is
no longer the danger, we carried this feeling over to money. (Bloom, 1995)

18
Etymologically Gaia is a compound word of two elements: *Ge, meaning " Earth" is found in many
neologisms, such as Geography (Ge/graphos = writing about Earth) and Geology (Ge/logos = words about the
Earth). *Ge is a pre -Greek substrate word that some relate to the Sumerian Ki, also meaning Earth. *Aia is a
derivative of an Indo-European stem meaning "Grandmother". The full etymology of Gaia would, therefore,
appear to have been "Grandmother Earth". (Wikipedia, 2006)

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The Great Mother is an archetype for sexuality, life-death and money. These are the three
realms that had been taboo in Western society up to the last century. We come across
surprisingly similar view in the teachings of Sri Aurobindo: “In its origin and its true action
money belongs to the Divine. Money is indeed one of the three forces – power, wealth, sex –
that have the strongest attraction for the human ego and the Asura (demon) and are most
generally misheld and misused by those who retain them. Regard wealth simply as a power to
be won back for the Mother (The Divine Power) and placed at her service.” (Parabola, 1991)

According to Lietaer the first forms of money, such as cattle and cowrie shells, were related to
the Great Mother and all earliest money systems were associated with this archetype. The
word ‘money’ originates from Juno Moneta, the Roman goddess of feminine. He also
mentions the first metallic coins that date from the Bronze Age in China, which had holes in
them, to enable them to be strung together in bundles for convenience. The earlier versions
had square holes, which made it harder to manufacture and tie together. He explains that while
the circle is the Yang symbol of heaven, the square represents the Yin element of Earth, which
implies the meaning of Mother Earth’s fertility at the core of money. (Lietaer, no date).

He also claims that the Great Mother archetype has been repressed for 5000 years: during
Indo-European invasions, Judeo-Christianity patriarchy, witch burnings, Victorian “manners”,
etc. An extensive study of the history of repression of the feminin e – which I will not go into
in too much detail here – with an insight on its money dimension, can be found in Lietaer’s
book The Mystery of Money. Unfortunately, the book has not been published in English
language, but an interested reader might be able to get a draft directly from the author.

Given this history of repression, Lietaer proposes that the Great Mother archetype
manifests in our society as two shadows:
- greed (Yang shadow) and
- fear of scarcity (Yin shadow).

Our official money system embodies these two emotions via interest and scarcity. In Lietaer’s
words: “The modern money system provides systematic rewards – earned interest – for people
who are willing to accumulate money, and would ruthlessly punish – by bankruptcy or poverty
– those who don’t play the game.” (Lietaer, 2003)

Adam Smith’s Economics

Adam Smith observed that in all ‘modern’ societies (his time coincides with the period when the last
witches were being burned in Europe) the systematic desire for individuals to accumulate is almost
universal. He considered that greed and fear of scarcity are normal in civilized societies. He did not
approve of greed morally, but he felt that one couldn’t oppose ‘normal’ behaviour.

On that basis he developed a theory – economics – whose purpose is to allocate scarce resources
through the means of individual private accumulation. He noted that no complaint about the money
system ‘is more common than that of a scarcity of money’. (Lietaer, no date)

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The Archetypal Human
The map of the Archetypal Human, including all 5 archetypes, would therefore look like this:

THE SOVEREIGN

THE WARRIOR THE LOVER

THE MAGICIAN THE GREAT MOTHER

Lietaer points out that these archetypes form pairs of how we relate: on the horizontal layer
Magician and Great Mother are the two complementary ways of how we relate to the
Universe/material world while Warrior and Lover are the complementary ways of how we
relate to others. On the vertical dimension, Warrior and Magician represent Yang expression,
while Lover and Provider (the Great Mother) are Yin energies. Sovereign is the integrating
force.

The effect of the national money system we have today, operating in mutual causality with
collective unconscious, is that it systematically represses feminine Yin values and
perpetuates the old patriarchal value system.

A Yang money system therefore activates the Yang archetypes: Sovereign, Warrior and
Magician. Yin archetypes are a blind spot in our society, The Lover Archetype is expressed
only in private life and arts, whilst The Great Mother Archetype is completely repressed.

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The money system also activates shadows :
- both shadows of the Great Mother Archetype (since the archetype is repressed, it is
completely in the unconscious), greed and fear of scarcity, as well as
- Yang shadows of all other archetypes: the tyrant, the sadist, the hyper-rational
(Apollonian) and the addicted.
At the same time, Yin shadows are projected onto others, who are seen as weak, chaotic etc.

Lietaer explains that the Ancient Greeks used to have rituals to address shadows, purifying
them through catharsis. Nowadays we have rituals only for the ‘upper’ Archetypes; Sovereign
(politics – elections), Warrior (sports) and Lover (performing arts). The two Archetypes that
represent basis and support are domains where there are no rituals to address the repressed
shadow in our society.

Rituals around Great Mother used to involve sex and there is currently none addressing the
shadows of the Great Mother. Given the complete repression of The Provider energies,
Magician is the only way we interpret the world through, the one leg we stand on. There are
no rituals addressing the shadows of this archetype: we don’t question the Apollonian
(rational) manifested shadow and we don’t allow for expression of Dionysian aspects of the
Archetype.

The process of ritualisation makes shadows harmless. When we don’t live them out through
rituals, we are enacting in real life the unresolved, shadow aspects of archetypal system. In
times of Apollonian rule – which we have now – Dionysian energy takes over in our shadows.
We can notice that everywhere, the world is getting more and more irrational and we don’t
even see that something is fundamentally wrong. Today again, just by picking up the
newspaper, I came across an article from which we can sense the Dionysian shadow, irrational
behaviour, linked to emotions, acting out:

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Sign o’ the Times

Entitled Get rich quick: buy a guitar and don’t play it, the article in The Guardian on July 4, 2006 is
talking about guitars being bought as investment. 1956 Fender Stratocaster, the kind of model Buddy
Holly once played, is currently worth twenty two thousand pounds and rising. Explanation from the
shop’s manager is simple: “After 9/11 and the resultant crash in the dollar, guitar prices dropped by
50%. European and Japanese dealers cashed in and as guitars started to disappear so prices began to
rise. And rise and rise.” The investors are men in their mid 40s and 50s, to whom art is mystery, while
guitars are an emblem from their youth. The mentioned Stratocaster is expected to rise by 30% in a
year’s time, but the good thing about guitars is that even when they reach the cooling-off point, they
stop, they don’t drop down, which is why they are seen as the best investment.

In the same way, through shadows, archetypal aspects of money are changing the monetary
systems. Irrational behaviour on a collective scale can lead to the crash of a currency, and
destroyed currency can destroy a whole society. Bank crashes or whole economies collapsing
became a common occurrence and nobody thinks there is anything wrong with it anymore. It
is just a part of how the system works, and we are not looking at the systemic problems,
causing crashes.

I believe it is extremely important to bring all this into consciousness, individually and
collectively. Jung said “That which we do not bring to consciousness appears in our lives as
fate.” We are currently living our fate in regard to money. Lietaer claims – and I fully agree
with him – that in our times only a fraction of the human population is awake to the systemic
problem of the monetary system. We need to start examining it, getting to know what is really
going on, we have to understand and then question it. Only when we understand what is going
on, we can start redesigning the money system proactively, having in mind what we would
like to achieve and support in our lives and in the world.

Integral Self – and Integral Society – will integrate all 5 archetypes, and activate all archetypal
energies on conscious level. To attain this, first we need to be aware that there is unconscious
material and admit the shadow aspects. We can observe these with the help and study of
archetypal psychology. This way we bring their energies out of the shadow into the light.
When we bring them into awareness, they can be dealt with consciously and healed, made
whole.

When all parts of our inner world or any system we work with are recognized, honoured, and
given their rightful place, change and healing are possible. In fact, meaningful change begins
by giving all parts their rightful place. When we exclude any aspect of a person or system,
that energy will hover as a ghost and cause problems. (Daly, 2004)

Our individual awareness and decisions are making a change with every action we take. But if
we remember the grid of integral perspective, it is clear that we should also think about the
systems and how to start consciously changing the system on the collective level.

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Balanced Economy
It is quite obvious that we need to bring more balance to our society. A way to look at it is to
calm the Yang and activate the Yin. In terms of money it is not a matter of how much
money but rather the kind of money that is important. “In order to manifest a world in balance,
we must bring balance to our money.” are Lietaer’s words. (Lietaer, 2002)

We need to balance and transcend the opposites. When we do that, in ourselves and in
society, we will be able to live the full potential of each energy. Since these are collective
patterns, we should deal with them on a collective (systems) level and therefore consciously
redesign the systems towards higher goals. There is no perfect money system that would solve
the problem, so perhaps we have to start thinking about 2 complementary systems. Yin
systems are emerging in practice all around the world, but they have little support and they are
still mainly unofficial.

Lietaer explains that the conventional national currency operates within the competitive
economy where it facilitates efficiently the various types of commercial transactions and in
the process it creates financial capital – Yang economic cycle. The Yin currency facilitates
community exchanges in a cooperative economy that help generate Social Capital (Yin
economic cycle; such as raising and educating children, caring for the elderly, community and
volunteer activities). Both economies require a foundation of Physical and Natural Capital.

Conventional economic theory focuses only on the Yang cycle and formally acknowledges the
existence of the two Yang forms of capital: physical and financial. They are exchanged in the
national currency. It tends to ignore the role of the two forms of Yin capital, natural and social,
and considers them as ‘externalities’. (Lietaer, 2002)

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According to Lietaer, whenever a monopoly of Yang currency prevails, the Yin functions
tend to be less acknowledged and honoured, and systematically starved of resources. These
are also the ‘feminine’ functions that used to be delegated to women, which links with public
invisibility of women and causes deterioration of the Yin forms of capital. The consequences
of this process are community decay, less solidarity and group creative activities; arts tend to
become created and consumed only by a fraction of population.

Commercial vs. Humane Economic Culture

Bloom believes that the commercial economic culture and the humane economic culture are distinct
and in conflict. They possess very different values and very different operating procedures

The commercial culture contains the adrenalin and excitement of innovation, pioneering and creative
conflict. Money is the fluid medium of communication which keeps the whole operation moving. In
the humane culture however, the important factor is the quality of life, the freedom of human beings
and of other life forms to fulfil their potential. This requires cooperation, generosity, friendship,
connection, warmth, support and nurture.

Bloom points out that it is crucial to recognize the difference between the two cultures and to notice a
very practical psychological dimension of this clash. People function effectively and successfully in
an environment which meets their sense of who they are. The smallholder, the entrepreneur and the
business person need a high level of freedom to release their creative energies. In exactly the same
way, if social services such as education or health are run according to market principles, there is again
a profound clash between the workers’ sense of who they are and what they want to be doing, and the
culture in which they work.

For efficient government and management, we desperately need to recognize and understand the two
money cultures : one that is free and competitive; the other which is caring and personal. According
to Bloom, it is the role of wise management and government to recognize these two separate dynamics
– not to force one on a situation which is inappropriate. (Bloom, 1995)

However, Lietaer believes that a society that honours feminine values would not repress the
masculine values, rather it would be a society moving towards the world in balance, either
by decentralized democratic organizations or complementary currencies. He proposes that
such initiatives can best be started at the grass-root level, in the sphere of social, cultural and
artistic nature, but at the same time warns: “Any Yin priority is by definition going to have
the swim upstream against the Yang undertow built into our conventional money system.”

We have all probably heard about the Lets schemes started by enthusiastic individuals in some
local communities – and how they failed to work. I must admit that at the moment these
schemes don’t resonate with me too much; I recognise how difficult it is for them to function,
having only weak support in comparison to the conventional money which everybody prefers
and has more belief in.

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Perhaps not much can change until more people realise how important the type of money we
all are using is, and start making conscious choices. Not only about how we use our money,
but also consciously deciding what kind of money we use for what purpose.

Lietaer, on the other hand, has strong belief in the future; he compares the emerging Yin
complementary currencies to the Wright Brothers planes: “It is a miracle that they fly in the
first place. But they have unquestionably proven that it is possible to fly.” He believes in
creation of well-designed complementary currencies, which can facilitate a continuous flow of
transactions that otherwise wouldn’t happen, thereby enabling more work, creating additional
wealth and more social capital, that would not happen without them. (Lietaer, 2002)

Complex Economy
Bloom claims that nobody can understand economics; the economic world as we know it is
very recent, it exploded into existence only over last 150 years. Financial and economic
realities are continually emerging as 5 billion human beings interact on this planet. Some
people love it, others are deeply alienated by it, but no one fully understands it. (Bloom, 1995)

Bloom proposes that there is wisdom in acknowledging ignorance, for it allows an attitude of
real investigative thinking. He proposes that the real issue is not to understand how certain
figures add up (old economics) but to grasp the patterns of emergence (new economics). He
claims that the world economy is now so complex that it would seem absolutely impossible to
plan or initiate overall transformational strategies. But here, he says, in fact, lies a great hope.
Its complexity demands new understanding and its complexity actually encourages
individual initiative.

Now, in the global village, we are in relationship with everyone and everything. With the new
interconnected, decentralised patterns that are emerging (such as for example the Internet) we
are regaining power and responsibility. Bloom points out that this new world questions not
only the awareness with which we handle our actual money, but the whole way in which we
engage with the world to earn our living. The new world that is emerging supports responsible
individuality. He proposes that individualism – alienated personal fulfilment – gives way to
self-aware collective sensitivity.

Bloom believes that with the growing complexity of the world economy, we have more
influence to change things. “This has to start with our individual economic behaviour. We
have to give full awareness to money transactions and we have to play a part in making sure
that money circulates – with dignity and generosity. We have to b egin to reclaim the
humaneness f our financial transactions. It starts with raising our own awareness and then
communicating about it with our family, friends and colleagues.” (Bloom, 1995)

He concludes that there are moments in history when we are called to engage in collective
events and when we cannot stand aside. This is not a comfortable process. It needs us to
sacrifice some of our habitual behaviour. In terms of money and our global economic culture
we are precisely in a time when we have to participate in collective action.

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8. MONEY AND SPIRITUALITY

Doing the Personal Work

How might money be a means of transformation? Bernice Hill proposes the following process
as a starting point for insights and experiences: “It is the archetypal process of the hero, where
he/she allows the ego to surrender to a higher knowing.” She quotes Mathew Fox, who writes
of the psychological journey in terms of pathways we must take to truly develop. The first,
Via Positiva, is one of inspiration, when we are being called to something greater in our
lives, but then, we must descend into the dark mysteries, embarking on the Via Negativa. This
path includes the pain of seeing our shadow and facing the necessity of letting go of many
things (Hill, 2004):

Step 1. Becoming Aware

Hill reminds us that money intertwines so subtly with the psyche that we are often oblivious to
our chronic distortions. We are all, at the level of personality, imprisoned in a labyrinth of
beliefs, attitudes and behaviours that do not serve us. Blocked by these repetitive patterns,
programmed from early life, we live only a tiny part of the vast experience available to us.
This especially applies when it comes to our perceptions of money, distorted as they are by
our cultural worldview and our complexes.
Ignoring our issues with money does not make them go away, it keeps them in the
unconscious where the shadow can continue to feed on them. The first step in our
transformation is therefore awareness, and the willingness to confront the shadow.
I believe that we only become aware of and can transform our money complexes in real life
situations. We can think we have everything sorted out in our head, but when we are faced
with a challenge, the true test comes – and with it the opportunity to transform. We constantly
go back to consciously making choices from deeper level of our being.

Step 2. The Descent Journey

Hill points out that our attitudes towards money display our level of consciousness. Through
the many experiences of a lifetime, we slowly come to see that if we operate only from the
personality and ego level, we are always coming from a sense of lack. It is inevitable that the
time will come when we will be called to confront those lesser shadow issues within
ourselves.
She warns that to enter our inner being requires “going down.” When it comes to money,
we have to look at our feelings of fear, anger and loss with clear eyes; inspect our
dependencies, our sense of identity and our greed. When we honestly recognize our pain, be it
fear, anger or grief, and hold it in suspension, new information arrives, coming from a well of
knowing that takes us by surprise.
But she also believes that this is the royal road to finding security in a more fundamental way
than money can ever provide.

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The Buddhist Path of Abundance

The Buddhist teaching explains that the Path of Abundance leads us through the World of the Gods,
the world of refinement, beauty and leisure: It is important for humans to have access to the god worlds
from time to time, but if we’re seduced into trying to live there we can easily find ourselves slipping
into states of inert self-indulgence. The god worlds have their place, but we can’t depend on our access
of them. For the very large majority of us, they are somewhere to visit not somewhere to live. One of
the main qualities of the human realm is that it is here that we have most freedom of choice.

The first step along the Path of Abundance is the move from reactivity to creativity. We learn to make
choices. This process has two components:
1. negative, in the sense of not doing: learning not to react
2. positive: involves learning how to act skilfully

(Kulananda & Houlder, 2002)

Step 3: Refining and Re-integrating

There are various ways available, which are not mutually exclusive. We can arrive at a deeper
spiritual place through experience, simply by faith, or by a discipline of conscience.
Meditation is a profound pathway, with this internal quiet we find emotional distance from our
complexes and their compulsiveness can fall away. We become clearer and are able to act with
greater discernment. Whatever way we choose, it is essential that both the personal
psychological issues as well as the spiritual connection are addressed in some fashion.
I would propose the very simple process of cycles of action and reflection; the cycles where
we are constantly looking into our actions, observing where they are coming from, what drives
them, and deriving further actions from the insights gained from reflection. This is what a
weekly ‘money’ meditation, which I will present next, provides for me.

Further Stages of Development

Having looked deeply into the relationship between money and the soul, we have come to
appreciate that what most determines our relationship to money is attaining a depth of
psychological and spiritual development. The question we now ask is “From where, from what
inner Source do we connect with money in our life?” We understand that money is a form of
creative energy, useful for sustaining us and potent for the future.
The spiritual warrior is in the flow of energy and has the capacity to live from an increased
depth of connection to Self (Soul).
The spiritual warrior who has become conscious in his or her relationship to money has
marshalled the courage to face the demo ns within and to heal. From this expanded
consciousness, money now becomes a vehicle for connection and community, rather than of
separation.

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Meditation on Money
A few weeks after I started writing my dissertation on money, exactly at the time I was deeply
questioning the meaningfulness of this work, I received a request to join weekly reflective
meditation on money, proposed by Alice Bailey. Meditation19 is asking us to:

Ponder on the redemption of humanity through the right use of money. Visualize the money in
the world today as:
a. Concretised energy, at present largely used for purely material purposes and for the
satisfaction (where the individual is concerned) of purely personal desires.
b. Visualize money as a great stream of flowing golden substance, passing out of the
control of the Forces of Materialism into the control of the Forces of Light.

The first part of the visualisation connects me into what money feels like in the world today.
Every Sunday morning I feel a rigid structure, money is stuck and the flow is blocked. It is
cold, crystallized and frozen; not unpleasantly, somewhat like glass.

When I attempt to visualise it flowing, the flow is coming right through my body. I am an
active force in this process, helping money to move with a gentle push. It is not a force but
rather pure, loving awareness. The movement is a golden flow, coming like a stream of light
from above, flowing through my body and pouring out of my heart, spreading out into the
world.

This vision of money makes the whole Earth a globe vibrant with golden energy. It feels
nurturing, warm and ‘motherly’; it is quite difficult to describe in words the energy I feel, but
it has a quality of a loving, caring mother; the world being a safe, friendly and rich place.

Breathing Money

In one of these meditations I had a clear understanding that the flow of money in and through
our lives is like breathing : coming in and going out in a constant exchange with our
environment.

When I’m doing meditation concentrating on the breath, I almost every time notice an attempt
to control breathing, make it deeper and/or more regular. My body becomes tense and I start
struggling. At moments like that I exhale deeply and let go, releasing the tension and struggle,
and let the breath come and go naturally again. I do that with tenderness and caring for myself,
not judging the imperfection of the process but accepting it for what it is at the moment, being
in that moment and working with it. My actions are not based on frustration and attempt to
control and fix, they come out of love and caring.

19
This is only a part of the meditation, the whole meditation is available in Alice Bailey: Discipleship in the New
Age, Vol. II, pp.228-31

84
The purpose of every meditation is to learn to be in such meditative state of awareness as
much of the time as we are able to, in everything we do. In this particular meditation that
focuses on breath the pur pose is to reach a state when we are increasingly aware of each
breath and each moment of breathing, conscious of what is going on, but letting it flow
naturally. We are breathing with loving awareness, gently directing the flow.

Our attitude to money is very much like breathing. If I re-read the experience two paragraphs
back, having in mind our relationship to money, I can recognise the same pattern: we are
trying to control the flow of money, we would like to make it regular – and therefore
predictable – which would make us feel safe and in control of the process. But by attempting
that, we become fixed and rigid, we contract and start to struggle against the flow, trying to
hold onto money. The flow of money is stuck. It is time for a deep outbreath.

- I prefer to inhale a little bit more than what I exhale; was a friend’s comment to this.
- What does one do with the air one keeps in?, I asked.
- One blows bubbles, was his reply.

I certainly exhaled deeply; when I decided to do this course I exhaled the money that has been
accumulating in my life for 7 years. The last remnants of the stale air are coming out and the
outbreath is coming to an end in a couple of months. Now I’m learning to breathe softly, but
with awareness, being conscious of as many moments as I’m able to. I am gently accepting the
tensions that I notice in this process and I’m learning to breathe through them, not acting out
of fear or panic, but connecting deep in my soul and ground my actions in integrity. In this
personal meditative process I am helping to set money into motion, with a help of my
conscious breathing: in and out, with love and awareness.

Spiritual Teaching

Sri Aurobindo, probably the only spiritual master who wrote about money, explains that: “Money is
the visib le sign of a universal force, and this force in its manifestation on earth works on the vital and
physical planes and is indispensable to the fullness of the outer life.” (Parabola, 1991)

Sri Aurobindo wrote a very small book, consisting of only 16 pages, entitled ‘The Mother’, which was
first published in 1928. It is the instructions manual for Sadhaka, an aspirant of the Integral Yoga. In
this book, Sri Aurobindo, the ‘Seer of the Modern Age’ has written about his ‘Seeing’ of the Supreme
Divine Mother– The Divine Shakti. He wrote the conditions to be fulfilled by the Sadhaka for
receiving the Grace of the Divine Mother for the great transmutation. (Wikipedia, 2006)

Sri Aurobindo’s teaching on money and wealth explains: “All wealth belongs to the Divine and those
who hold it are trustees, not possessors. All depends on the way they discharge their trust while it is
with them, in what spirit, with what consciousness in their use of it, to what purpose. In the ignorance
of the lower Nature, money can be usurped for the uses of the ego or held by Asuric influences (Asura
designates the demon or antigod) and perverted to their purpose. Money is one of the three forces –
power, wealth, sex – that have the strongest attraction for the human ego and the Asura and are most

85
generally misheld and misused by those who retain them. The seekers or keepers of wealth are more
often possessed rather than its possessors.
You must neither turn with an ascetic shrinking from the money power, the means it gives and the
objects it brings, nor cherish a rajasic (rajah-like) attachment to them or a spirit of enslaving self-
indulgence in their gratifications. Any perturbation of mind with regard to money and its use, any
claim, any grudging is a sure index of some imperfection or bondage. The real Sadhaka in this kind is
one who if required to live poorly can so live and no sense of want will affect him or interfere with the
full inner play of the divine consciousness, and if he is required to live richly, can so live and never for
a moment fall into desire or attachment to his wealth or to the things that he uses or servitude to self-
indulgence or a weak bondage to the habits that the possession of riches creates.” (Parabola, 1991)

The day after the meditation insight, in the book by William Bloom that I was reading at that
time, certainly not by coincidence, I got to the page with this formulation: “In essence, money
is another aspect of the divine breath, but a long human history has polluted it. It is crucial,
therefore, that we give consciousness and goodwill to our financial acts and thoughts. The
consequences of our thoughts and acts are not only immediate and visible, but also long-term
and invisible. In every financial act done with an attitude of goodwill and consciousness, we
cleanse and revibrate the money archetypes. In every act of financial selflessness, we
transform the selfishness and greed. In every act of charity and generosity, we help to get
money dancing again for spirit.” (Bloom, 1995)

Bloom explains that cosmic consciousness – the vitality and creativity of the original breath of
creation – permeates everything. It is in everything and it values everything. In human culture,
money exactly reflects this attribute of cosmic consciousness. Seen from this perspective, he
claims, money is the most dense form of cosmic consciousness. Money is the divine breath in
material form.

Bloom is also sharing his own insight, a powerful dream he had when researching his book. It
is a fascinating vision, which everybody should keep in their mind. Below is his story:

The Golden Tornado

I woke one morning with a lucid memory whose power and vividness were overwhelming. It was one
of those dreams that was not only visually colourful and clear, but that also carried an atmosphere
which, awake, I was still experiencing. The atmosphere was vibrant, felt good and life-enhancing. 20
This dream delivered a vision of how money works, what money is and why money is.

The dream was both complex and simple. The main image was of a swirling golden vortex or
tornado, narrow at its base, rising wider and wider. It was made up of particles of energy spinning
upwards and outwards on many different paths at many different angles. It was warm and
exhilarating. There were other colours mingled w ith the gold: bright white, other yellows and rose.

20
This is a very similar description to the feeling I have about the Earth as a vibrant golden globe.

86
The whole vortex was radiant. It was also so large that I could hardly gauge its size. Perhaps it was
several miles high; perhaps the size of a planet.
The golden particles of the vortex created many different paths, but had a general pattern which
reminded me of the double helix of the DNA molecule.
If I looked closely, I could see that each particle was made up of two human beings involved in a
money transaction. Every single one of the vortex’s particles was, without exception, two human
beings in a financial transaction, with money passing between them. The whole vortex was human
beings in financial relationship. Particle by particle, through the entire vortex, money was the
flowing glowing medium of the radiant system.
In the dream I could actually see some of the particular transactions, such as two Bedouin in the desert
drinking tea, exchanging money for goods; or a parent giving pocket money to her son; or one
woman’s donation to the musician playing in the street.
Many, perhaps all, of these particles were connected with chains of other particles and money
transactions. For example, one woman who was passing money in exchange for bread was also
connected – through other particles – with the baker, the miller, the shipper, the farmer and so on. …
Some of the transactions were so complex that they seemed to spread through the whole vortex.
As I contemplated these images, I wondered what element created the vibrant golden radiance and I
focused more carefully on a single transaction. In this particle the two people involved in the
transaction were happy and pleased. The deal served them both. The glow came from their
satisfaction and pleasure. … No matter how many particles I studied, they all possessed this same
phenomenon. They glowed with healthy, satisfied and creative human energy.
At the base of the vortex, where it was most narrow, it anchored deep into the earth. At this earthy base
most of the transactions involved only two people. Higher up the vortex, the chains and networks of
connection became more complex and involved. But no matter how complex, there was always
creative human relationship. No matter how complex, there were always at the core two people,
communicating, sharing, exchangin g.
As this was a dream, it had more than three dimensions and people were in many places at the same
time.
At one point in the dream the vortex shrank and I could grasp the whole thing at once. At its base was a
simple transaction between two people. Going up, more people were involved in chains of relationship.
First there was the level of a small tribal or clan community. Another level up and there was a small
village. Then a town. A city. A nation. Widening and going up and out into the global economic
community.
And then I saw another perspective, which can only be described as mystical. … It also drew me into
an altered state of consciousness. I could feel my awareness expanding and a sense of what I might call
cosmic connection.
This new perspective showed that the global community of human beings, the planetary village, had
been facilitated into existence by money. Money, far from being coincidental in the creation of a self-
aware global community, has been creatively instrumental in building it. … It would, in fact, be
impossible to have a global community if it were not for money. Human beings are evolving from
parochial isolation into a global awareness, and this awareness is physically made manifest through the
medium of money.” (Bloom, 1995)

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Basing his perception of money on this powerful dream, Bloom suggests that money comes
into being to facilitate more complex forms of society, production and relationship. “The
different modes of society reflect a movement away from individual human, locked in clan, to
universal human capable of planetary consciousness. All through the system, money – barter,
notes or electronic information – facilitates humanity in extending its relationships.”

Kulananda and Houlder (2002) even claim: “No money, no civilization. ” They explain that
money is a triumph of mind over the material world, enabling us to connect with other people
across time and space.

Bloom asserts that healthy money flows. It is a form of fluid and moving relationship. It is
mediated by people and it facilitates all human relationship in form. He compares money to a
musical string, strung taut between earth/Gaia and cosmic consciousness; which vibrates
out its own resonances – good through to bad – when played by humanity.
At the base of the double helix, money emerges from the labour of Human & Gaia.
At the top of the vortex money emerges from the labour of Human & Cosmos (God).

Many people see money as a curse, even as ‘the root of all evil 21’. If we can hold Bloom’s
vision of money as a sacred tool that is connecting us and enabling many wonderful things to
happen, maybe we can transform our view of money and align our actions with such a vision.

And if we can learn to ‘breathe’ money subtly and lovingly, with purifying awareness –
purifying in the sense of purifying the flow of money, but also in the sense of awareness itself
becoming more and more pure – we will not transform just our own lives, we will spread our
loving energy out into the world.

21
The actual quote from the Bible is: 'For the love of money is the root of all evil: which while some coveted
after, they have erred from the faith, and pierced themselves through with many sorrows.' Timothy 6:10.

88
 CONCLUSION
In a certain sense, growth is a world-shattering experience
for the world is our horizon of meaning that might suddenly lose its comforting familiarity.
(quote from the toilet at Schumacher College)

You probably opened this page expecting a summary, a short and clear answer to the question:
‘What is this dissertation about?’

Don’t expect me to give you any answers; I have no idea. I started the journey on this crazy,
wild river out of fascination at the power money has over us and our lives and I followed its
meanders where they took me, occasionally diving into its mysterious depths. It was an
interesting but often painful process; some paragraphs took months to form, requiring me to
live to the fullest the very phenomena that I wanted to write about before I was satisfied with a
single page on it. Embarking on this journey I courageously called on my own shadow, willing
to finally ‘deal with it’; that funny character certainly dealt with me. But at least I have grown
to like it and enjoy its company; my own company. Coming to the end of the journey, I am left
with no answers and my life completely decomposed.

I was just doing the final proofreading and it was interesting to read my own Calling. I
certainly don’t feel like that any more. This is where I am at the moment; and it is scary:

“Have you ever felt that there is something, just out of reach, that will make your life complete if
only you had it?’ That sense that there is something vast but indefinable missing in our lives is an
essential part of the basic human experience. Sometimes that hole is scarily yawning open before
us. Sometimes we’re half-aware of it.
We’ll do anything to fill that void. Most of us have hoped that a loved one, or a vocation, will fill
that hole and give us – in the literal sense – fulfilment. Sometimes we avoid that sense of
incompleteness by keeping busy. And of course there’s money. Money provides the power to reach
out and make almost anything ours. It’s so easy for us to promise ourselves that this will make our
lives complete. But it doesn’t.
At this point Buddhism has something to say that strikes right at the heart of the problem of
incompleteness: Money will not make your life complete. In fact, nothing will.
Nothing whatsoever will make your life complete: not possessions, not a job, not a family, not a
vocation, or a loved one, nor drugs, not even Buddhism. That’s because of the way life is, and
suffering comes from our determined attempts to swim against the flow of life.”
(Kulananda & Houlder, 2002)

I wanted to liberate myself from the grip of money, the beliefs and fears I have around it. I
knew that money was not the answer, and perhaps my steps in this money jungle are now a bit
more firm, less guided by fear. But by giving up money, I expected to get something bigger,
more important and more fulfilling in return. I got nothing. Not only have I given up the
security of money; now I’m asked to give up everything and not expect anything; just flow.
Well, as I already feel stripped of everything, I’ve got nothing to lose, I might as well plunge.

89
I was told it usually takes about two years for people to put their lives together after being
through the Schumacher ‘washing machine’. So don’t wait for me to figure naything22 out; I
gave up trying to do that. I stopped looking for answers, stopped trying to find the ultimate,
perfect solution.

"There is hardly a week that passes when I don’t ask the unanswerable question: what am I now
convinced of that will turn out to be ridiculous? And yet one can’t forever stand on the shore; at
some point, filled with indecision, scepticism, reservation and doubt, you either jump in or concede
that life is forever elsewhere."
(Arthur Miller)

So I’m jumping. Without any answers, any schedule for the future, right into uncertainty. And
I guess my next step is to learn to enjoy the chaos; as my friend says: “The more bumps on
the road the better the ride.” Thank you for such a different perspective on life, Vivek!

My world has shifted. By that, the whole world is shifting.

And this is just the beginning…

... with love and special thanks to everybody who supported – or challenged –
me on this journey.

22
No, this is not a typo. Actually, it was at first, but I decided to leave it as it is.

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BIBLIOGRAPHY:
(main literature is marked in bold letters)

Bloom, W. (1995) Money, Heart and Mind. London: Arkana, Penguin Group.
Boeree, Dr. C.G. (1997) [online] Personality Theories: Carl Jung. Available:
http://www.ship.edu/~cgboeree/jung.html [date accessed: 29 July 2006]
Boyle, D. (2003) The Little Money Book. Bristol: Fragile Ea rth Books; Alastair Sawday
Publishing.

Chetwynd, T. (1993, first published 1982) Dictionary of Symbols. London: The Aquarian
Press, HarperCollins Publishers.

Daly, T. (2004) [online] The 4 Gateways. Available: http://www.4gatewayscoaching.com

[date accessed: 20 July 2006]

Davies, R. (2005) [online] Origins of Money and of Banking. Available:

http://www.ex.ac.uk/~RDavies/arian/origins.html [date accessed: 10 April 2006]

Douthwaite, R. (1999) The Ecology of Money. Bristol: Schumacher Briefings, Green Books.

Edinger, E.R. (2002-2006) [online] An Outline of Analytical Psychology. Available:

http://www.iloveulove.com/psychology/jung/analypsych.htm [date accessed: 20 July 2006]

Hallbom, K. & D’Alo Armand (2005) [online] The Psychology of Money, Prosperity and
Wealth. Available: http://www.thewealthymind.com/WMprosperity.htm [date accessed: 20
May 2006]
Hill, B. (2004) [online] Money and the Spiritual Warrior. Available:
http://www.cgjungpage.org/index.php?option=com_content&task=view&id=769&Itemid=40
[date accessed: 10 April 2006]

Hillman, J. (1989) A Blue Fire. New York: HarperCollins Publishers.

Hillman, J. (1995) The Kinds of Power. New York: Currency Doubleday.

Hyde, L. (first publication 1979) The Gift; Imagination and the Erotic Life of Property.
London: Vintage.
Kennedy, M. (1995) [online] Inflation and Interest-Free Money, extracts. Available:
http://userpage.fu-berlin.de/~roehrigw/kennedy/english/ [date accessed: 18 August 2006]

Kennedy, M. (1999) [online] A Changing Money System . Available:

http://www.margritkenne dy.de/downloads/Ch.MoneySystemMK.pdf [date accessed: 19
February 2006]

Kennedy, M. (no date) [online] Why Do We Need Monetary Innovation? Available:

http://www.margritkennedy.de/english/MoneyPres05MK.pdf [date accessed: 19 February
2006]

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Korten, D.C. (1995) When Corporations Rule the World. USA: Kumarian Press.
Kulananda & Houlder, D. (2002) Mindfulness and Money. New York: Broadway Books.

Lietaer, B. (no date) The Mystery of Money – Beyond Greed and Scarcity. Unpublished,
draft January 2003.

Lietaer, B. (2001) The Future of Money. London: Century.

Lietaer, B. (2002) A World in Balance? Paper published in Reflections, the journal of the
Society for Organizational Learning (SOL) Summer 2003; Special issue on “The Feminine
approach to leadership”
Lietaer, B. & Belgin, S. (2005) Of Human Wealth extracts, draft of a work in progress. USA:
Citerra press.

Lietaer, B. & Belgin S. (2006) Of Human Wealth. Pre-publication Edition Version 4.1.
Boulder, USA: Citerra press.

Lockhart R., Hillman J. et al. (1982) Soul and Money. USA: Spring Publications.
Miller, W. (1989) Your Golden Shadow. USA: HarperCollins Publishers.

Moore, T. (1996) The Re-enchantment of Everyday Life. USA: HarperCollins Publishers.

Parabola; the magazine of myth and tradition (1991) Money. New York: Society for Study of
Myth and Tradition.

Robertson, J. & Bunzl, J. (2003) Monetary Reform – Making it Happen! London: International
Simultaneous Policy Organisation.

Rothbard, M. N. (1983) The Mystery of Banking Richardson & Snyder. Available online:
http://www.mises.org/mysteryofbanking/mysteryofbanking.pdf [date accessed: 11 April 2006]
Rowbotham, M. (1998) The Grip of Death. Charlbury: Jon Carpenter Publishing.

Schumacher, E.F. (1974) Small is Beautiful. London: Abacus.

Twist, L. (2003) The Soul of Money. New York, London: W.W.Norton & Company, Inc.
Woodward, D. (2005) Rights-Based Economic Policies: Get ting There from Here. New
Economics Foundation paper.

Wikipedia, the online encyclopaedia. Available: www.wikipedia.org .

Zarlenga, S. (2000) [online] A Brief History of Interest. Available:
http://www.monetary.org/interest.htm [date accessed: 29 April 2006]

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Addendum 1: GOLD …
What is this mysterious substance; where does our fascination with gold come from?

Even nowadays, when the link with money has been broken for decades, many people still
find gold being the safest and most stable investment. Through any crisis or market collapse
gold will retain its value. One will always be able to find a buyer for it, if needed, and get the
same or even higher countervalue for it as the time passes.

The most obvious explanation for the high value of gold is its scarcity, combined with its
physical characteristics. Gold - with the chemical symbol Au from the Latin aurum - is a
good conductor of heat and electricity, it does not react with most chemicals, is not affected
by air and heat, moisture, oxygen, and most corrosive agents have very little chemical effect
on it. Gold is the most malleable (able to be hammered into very thin sheets) and ductile (able
to be drawn into a fine wire) of all metals.

Jewellery

It is known (or believed?) that various metals have particular effect on the human organism. They
have ability to destroy structures and can destroy negative information structures in people,
claims Russian newspaper Pravda23 . Gold is said to stimulate the energy flow, delivering energy
to the urogenital system. Silver has anti-inflammatory action, which is why it was used to make
cutlery, to be less open to infections.

The article explains that “every good acupuncture specialist has two sets of acupuncture needles
made of gold and silver. Acupuncture with silver needles relieves or localizes inflammation of
organs. In case some organ is weak to function normally, an acupuncture doctor will offer
performing acupuncture with a gold needle to stimulate the energy flow.”

In general, the article says, experts recommend wearing jewellery made of gold if you have
collapse or slackness. And silver jewellery will do better for those who are short of temper and
nervy.

But for an average person, gold itself has no useful value other than its exchange value. Still,
for most human beings gold represents wealth, security, status and prestige. The advertising
profession uses the prestige we associate with the image of gold to emphasize the prestige of
the goods they are trying to sell, for example gold credit cards – although the overuse of the
symbol already diminished its potency.

Bloom even states that a desire for material wealth is a warped reflection of our need for union
with our own souls and inner selves. In many mystical traditions the human soul s pictured as

23
http://english.pravda.ru/science/health/19-10-2005/9091-jewellery-0

93
golden, or as a chalice. In our daydreams of wealth, we forget the search for the true inner
gold and beddazle ourselves with material glitter. (Bloom, 1995)

Gold as Symbol

In The Dictionary of Symbols, gold is stated as the symbol of ‘the enduring and untarnishable
essence of life ’; whatever is of highest value. It is the whole Self, the conscious rational mind: not just
the thinking function, but rather those functions which have been brought into the light of
consciousness.

The relationship between gold and silver symbolises the conscious mind in contrast with its Shadow
(Sun/Moon). Like the Moon, silver turns black, and needs to be repolished; so it is a symbol of the
corruptible, changing side of nature, which needs to be transformed. Silver is the bride of gold and
those who seek it are often in need of the feminine forces of life. (Chetwynd, 1982)

Most people feel that there is much more to gold than just its physical qualities. Gold talks to
our psyche. It is beautiful, and shiny like the Sun, the source of energy and life. In Alchemy,
gold has the same symbol as the Sun. The process of transforming basic metals to gold was for
alchemists also the process of purifying themselves, reaching their own perfection.

Alchemical Gold

Gold is one of the seven metals of alchemy (gold, silver, mercury,

copper, lead, iron & tin). For the alchemist, gold represented the
perfection of all matter on any level. It also symbolizes
humank ind's goal to obtain perfection in mind and spirit.

The alchemists often talk about ‘ living gold’. The living gold is
pure consciousness, or pure awareness. The alchemists also say
that the elementary gold (pure consciousness) is the philosopher’s
stone made pure and perfect by the Great Work. Gerhard Dorn in
Alchemical Symbol of 16th century describes the alchemical gold as the divine, creative
Gold influence present in all matter. (Parabola, 1991)

Common belief for quite a long time was that alchemical attempts were due to the temptation
to get rich quickly by seeking to make gold and silver from the common metals. But in actual
fact, as explained in Parabola, the magazine for myth and tradition, the issue on Money, gold
and silver were already sacred metals before they became used as money. (Parabola 24 , 1991)

24
Article by Titus Burckhardt: Making Real Gold (Parabola, 1991)

94
“They are the earthly reflections of sun and moon and thus also of all realities of spirit and
soul which are related to the heavenly pair. Until well into the Middle Ages the relative values
of the two noble metals were determined by the relationship of the rotation times of the two
heavenly bodies.” The symbolism depends on the fact that things which differ from one
another can possess and exhibit the same essential quality. The magic of gold thus springs
from its sacred nature, its qualitative perfection.

Sometimes the alchemists talk about three kinds of gold 25 . The first one is an astral gold, the
center of which is in the Sun, it transfers this gold by its rays and with its light at the same
time to all the lower pla nets. It is a fiery substance and it is a constant emanation from the
stellar bodies, which permeates the entire universe. Space, the atmosphere on the planets, and
the planetary bodies themselves are completely filled with it. We constantly absorb this astral
gold by our breath. The astral gold particles then spread themselves all over our bodies. This
alchemical description corresponds very well with what is called ‘prana’ in the eastern
philosophies.

The second kind is the elementary gold. It is the purest and most fixated part of the elements,
and of all substances that are made thereof. All living beings of the three nature realms have
this priceless elementary gold within themselves. It is also called the central fire of the earth.

The third kind is the common metal gold.

… AND COWRIE SHELLS

One of the people I discussed the mystery of gold with argued that gold was such an important
means of exchange exactly because it did not have useful value. He compared it to cowrie
shells, which have been used as money for centuries. This suggestion took me on another
interesting journey, exploring the origins of cowries as money.

Cowrie shell is perhaps the most recognizable of African symbols,

used to make social, cultural, spiritual and political statements. The
intended symbolism of the cowrie depends on the context in which it
is used: they bear the message of conscious, spiritual and fighting for
the upliftment of Africans worldwide. But regardless of its use, the
cowrie always inspires admiration, respect and awe.

The cowrie shell was the first symbol of money and wealth known to mankind. It has been used
as money in many parts of the world , including China, Africa and Arabia. In Ancient Africa
(when the African civilization encompassed every land on Earth), the cowrie was used much
like the dollar is used today. They were wealth, and they were traded for goods and services.

25
http://www.soul-guidance.com/houseofthesun/alchemy_3.htm

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But why would humanity choose the cowrie shell over all other items that could be used for
the same purpose? Master Naba, Dogon Priest and Spiritual Master from Burkina Faso, which
is one of the centres for culture and spirituality in West Africa, explains 26 :

"There is a Goddess who lives in the water called Mote or more affectionately, the 'Mommy of
Water'. This Goddess lives in the sea, and she is accessible through any body of water. This is
a powerful Goddess who affects the lives of people on Earth as well as other Deities. The
Mommy of Water has the ability to reward those who please her and to punish those who do
not. The rewards that the Mommy of Water gives when she is pleased is the cowrie shell, and
this is where the notion of money comes from,"

Why was it so important for someone to have an object that was given by a God or Goddess?
Why would people travel hundreds of kilometres to trade goods for little shells? “The cowrie
shell comes as a token of recognition by the Goddess. When people pleased her, she made the
sea wash out cowrie shells on the beach that came from deep within her kingdom, the sea.
They came as a proof of being accepted by the Goddess and as a reward and gift from her.
Cowrie shells are a gift from a Deity. The best way to access a Deity is through the gifts
offered by that Deity.”

Because it carried such a heavy spiritual meaning, people who did not live by the coast wished
to trade things with people for the cowrie shells. They wanted to have something from the
Goddess too.

Another source 27 is almost warning: “Your attraction for the cowries could mean that you are
a son of Yemaya, a Yoruba ocean spirit associated with wealth and mother earth. Your interest
in African drumming and culture is another sign. Do you feel drawn to the sea? Children of
Yemaya have been known to swim out into the sea and never return!”

I am drawn to the sea and to African drumming, having my own djembe drum stored at my
parent's place in Slovenia and another, borrowed one, in my room here in England. As I am
writing this, I am looking out the window at the sea– should I be worried? If I don't come back
and the only thing you find left behind is my computer, you will know that the sea has claimed
me back…

But Master Naba gives further explanations, which by the most unusual route take us back to
where we started from, offering yet another view on gold:

"Gods of the other three elements also give important gifts, that could have been used as
money but were not. Nwt, or fire, gives the holy fire, a purifying fire that is needed for a God
to reach the heavens, and Nwt gives the celeste rock as a gift. Shw (air) gives incense and
spices. Geb (Earth) gives gold. We do not see gold in the same materialistic way that others
do...gold is really a gift from the God Geb and is holy and spiritual."

26
http://www.theearthcenter.com/ff45benben.html
27
http://djembelfaq.drums.org/v6a.htm

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Addendum 2: PROACTIVE MONEY
I came across an interesting overview of money throughout history on Internet, written by
Flemming Funch28. He bears no title and is probably not a highly respected economist, but
what he is saying simply makes sense. Still, I sent the text to Bernard Lietaer, to see if there
was something that I overlooked. But Bernard confirmed the insight: “I agree with the
principle of what he is saying: information age economy will require new types of informatio n
age currency... A key domain where that is relevant is in the field of intellectual property
valuation...” (Lietaer, personal communication) Let me summarize the overview:

Before the arrival of agricultural societies money wasn't needed. Hunters and gatherers
would simply take what they needed or wanted, fight for it if necessary, and continuously
move on to where they could find the resources they were seeking.

In "first wave" agricultural societies the land would be worked to produce food and surpluses
would be stored up or traded. Trading would open the need for money as a means of exchange.
Suddenly it became important what you HAVE, what you own. If you have land you can grow
food and sell it. If you have produce you can sell it. Power and affluence is measured by how
much you currently own.

The "second wave", the industrial revolution, centralized production and machinery and
buildings needed to be in place BEFORE something valuable was produced. That brought
about the need for financing, having or borrowing money before you could create more. Then
the monetary value of what you produced is in part based on the need to recuperate the
investments made and the costs of the resources that had to be acquired to put into the product.
As opposed to agricultural production, industrial production requires that you get resources
from elsewhere that you can build your products of and with. Money comes to symbolize what
is OWED for the previously used resources that went into what you are paying for. Wealth is
based on how much you have produced in the past that you are now being owed for.

The "third wave", the information society, changes the equation again, even though the
change isn't fully realized yet. Information and knowledge can potentially be arrived at
instantly and they can in principle be replicated any number of times without any use of
resources. What becomes important is not what happened before, but what happens AFTER a
piece of information is generated or distributed. The value of an idea is in what it allows you
to do, not in the amount of trouble it took to arrive at it, nor in its value as a possession of
yours.

But our economic system is still based on second wave principles. Our currencies are still
defined by the amount of debt they represent. Our financial institutions are based on the
financing of production that then is owed for and needs to be repaid with interest by the
proceeds from trading with the production.

28
Source: http://www.newciv.org/essay/proactivemoney.html

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Information products fit poorly into this scheme and it creates friction and unnecessary
hindrances to their use that they are treated by the old industrial model. For example, the
concept of intellectual property is an attempt to treat information as material products.

If a factory produces a car, a certain amount of materials go into it and it is in itself a very
tangible product. It will always be worth something in that there is a limited number of cars
and raw materials and there is a need for both. It is quite workable for the car factory to expect
to get back what they' ve spent on making the car, and then some, in exchange for granting
somebody the privilege to take possession of the car. That person would after all be able to
trade further with the car, as it has value in itself.

A knowledge product, such as a software program, works quite differently. It can be

reproduced with no incremental cost and without any resources required by its original
manufacturer. Potential users will of course quickly discover that they themselves can
manufacture a fresh instance of a software product.

A car manufacturer couldn’t probably care less if you went home and constructed a copy of
his car in your garage, because he knows that he gets paid for the resources and work he puts
into the production of his car. A knowledge worker can not have the same assurance and
might have impossible difficulties ensuring that he will get his investments in time and
resources back, because he has nothing tangible to show for it. Somebody might help him
installing some kind of police state methods of monitoring how people use his product so he
can be paid, but that is really only stalling the inevitable conclusion.

Information providers, such as copyright owners, software producers, or artists running

around angrily trying to stop people from using their information without paying for their
past work, is a sign of the economics no longer being in tune with the methods of
production and distribution.

The fact of the matter is that information inherently can be reproduced infinitely and there
is no inherent value in simply owning it, or in having worked hard at it. There is only value
in using it.

If instances of information in themselves had value, all one needed to do to be rich would be
to duplicate them a zillion times. It is nonsense of course. Making repeated copies of a
software program on your hard-disk doesn't produce any wealth.

We can not measure the worth of information by the resources that went into producing it
earlier. An idea that it took a second to generate might revolutionize the world. A 50 million
dollar movie might be an unwatchable flop.

The concept of having to be paid for what one did earlier is no longer valid in the natural
3rd wave economy.

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"Pay me if you want my property" is 1st wave thinking. The most appropriate currency for that
is one that converts into tangible property in a predictable manner, such as gold.

"How do I get back my investment?" is 2nd wave thinking. Dollars, defined inherently as debts
to the banks, are likewise 2nd wave currency, destined for obsolescence.

"What can I do with my knowledge?" is 3rd wave thinking. It is no longer about being paid
for what you have or what you spent. It is how you can spend the resources you have in the
most productive way.

Existing information is free and infinitely reproducible so there is no need to ration it and
charge money for it or own it. The most valuable services in an information society is to
produce/invent something NEW or to show people the way to what is already there.
Information itself will be without inherent value in an advanced information society. Getting
new information that you need when you need it is what is valuable.

So how do we account for new useful information and services being made available? Do we
need to account for it at all?

There is really no big need to account for existing information, as it isn't limited and is
impossible to quantify. The same with creativity. What we can quantify and account for is
anything that is in a limited supply.

As more and more resources get transformed into an unlimited supply they will no longer need
to be accounted for. For example, since sunlight is for our purposes inexhaustible, we don't
have to account for it.

For a 3rd wave economy we need a currency that doesn't reflect ownership or past work,
but that stimulates future creative work.

We could regard that kind of money as a voting system for what one finds of value.
Information and benefits are potentially unlimited. It therefore doesn't make sense to match
them up with a scarce, limited medium of assigning value. The valued currency should be able
to expand to match the value of the benefits that are experienced, rather than the estimated
values having to be shrunk to the supply of currency available.

How exactly to do that, I don't know. But, it is apparently to me that the current money
systems are not very helpful in creating a better future where all of our needs are met, and it is
not very practical as a measure for what is actually valuable in our lives.

We probably need a system where anybody who creates or perceives value also creates
money, and the money is not a loan to be paid back, but a gift to be passed on.

That is not possible with scarcity money, but only with money that people can freely give
without experiencing a personal loss from doing so. Money that gains value from being
used on something desirable, and that retains no value from being kept.

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100
Addendum 3: MONEY TYPE TEST29

1. List of Characteristics

Circle each word or phrase that describes how you are around money or that, in general,
reflects the nature of your personality.

Anxious Prone to blame Highly emotional

Lives in past Financially irresponsible Seeks rescue
Trusting Feels powerless Unforgiving
Addictive Self- fulfilling prophecy Powerful
Driven Disciplined Goal-oriented
Feels betrayed Confident Calculating
Highly critical Judgmental Secretive
Rescuer Aggressive Generous
Loving Conscious Open to Flow
Manipulative Happy-go- lucky Discerning
Controlling Long-suffering Caretaker
Self-sacrificing Resentful Passive-aggressive
Compassionate Wise Restless
Undisciplined Fearful Financially successful
Impetuous Optimistic Overly generous
Adventurous Lives in the present Internally motivated
Detached Highly materialistic Loner
Seeker Tells the truth Non-materialistic
Financially balanced Vibrant Indecisive
Passive Seeks security Financially dependent
Secretive Represses feelings and beliefs Non-confrontational
Artistic Obsessive/compulsive Competitive
Transforms reality Lives for the future Harbors resentment
Spiritual Rigid Loyal
Oppressive Prone to rage or violence Cautious

29
Source: http://www.money-therapy.com/content/view/18/43/

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2. Key to the Money Type Exercise

Write down all the characteristics that you have checked on this list. The following page lists
all the characteristics with a number beside each. This number represents the type or types
each characteristic is associated with.

1 Anxious 2 Prone to blame 2 Highly emotional

2 Lives in past 2&5 Financially irresponsible 2 Seeks rescue
1&8 Trusting 1&2 Feels powerless 2&7 Unforgiving
2 Addictive 2 Self- fulfilling prophecy 3&8 Powerful
3 Driven 3 Disciplined 3 Goal-oriented
4 Feels betrayed 8 Confident 3&7 Calculating
4&7 Highly critical 4 Judgmental 4&7 Secretive
3&4 Rescuer 7 Aggressive 3&8 Generous
8 Loving 8 Conscious 8 Open to Flow
4&7 Manipulative 1&5 Happy-go- lucky 3 Discerning
4&7 Controlling 2&4 Long-suffering 4 Caretaker
4 Self-sacrificing 2 Resentful 2&4 Passive-aggressive
4&8 Compassionate 3&8 Wise 5 Restless
5 Undisciplined 1,2&7 Fearful 3&7 Financially successful
5 Impetuous 5&8 Optimistic 5 Overly generous
5 Adventurous 8 Lives in the present 6 Internally motivated
6&8 Detached 7 Highly materialistic 6 Loner
6 Seeker 6&8 Tells the truth 6 Non-materialistic
8 Financially balanced 8 Vibrant 1 Indecisive
6 Passive 1 Seeks security 1 Financially dependent
7 Secretive 1 Represses feelings and beliefs 1&6 Non-confrontational
6 Artistic 7 Obsessive/compulsive 3 Competitive
8 Transforms reality 5 Lives for the future 4 Harbors resentment
6&8 Spiritual 7 Rigid 3 Loyal
7 Oppressive 7 Prone to rage or violence 3 Cautious

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3. Money Types Defined

Add up the number of characteristics you have in each category. The category that you have
the most number of is your primary money type. If you have more than three in any other
category, this is an indication that this money type remains active in your life. You have work
to complete with this type as well.

1 = Innocent
2 = Victim
3 = Warrior
4 = Martyr
5 = Fool
6 = Creator/Artist
7 = Tyrant
8 = Magician

A score of 4 or less is a passive money type

A score of 5 or greater is an active money type

1. The Innocent

The Innocent takes the ostrich approach to money matters. Innocents often live in denial, burying their heads in
the sand so they won't have to see what is going on around them. The Innocent is easily overwhelmed by financial
information and relies heavily on the advice and opinions of others. Innocents are perhaps the most trusting of all
the money archetypes because they do not see people or situations for what they are.

They are not unlike small children in the sense that they have not yet learned to judge or discern other's motives or
behavior. While this trait can be very endearing, it is also precarious for an adult trying to cope in the real world.

We all start out our journey in life as innocents. However, as we grow and develop, the veil of innocence is lifted
and replaced by our experience with the outer world.

2. The Victim

Victims are prone to living in the past and blaming their financial woes on external factors. Passive-aggressive
(prone to acting out their feelings in passive ways rather than through direct action) in nature, Victims often appear
disguised as Innocents, because they seem so powerless and appear to want others to take care of them.
However, this appearance is often either a conscious or subconscious ploy to get others to do for them what they
refuse to do for themselves. Victims generally have a litany of excuses for why they are not more successful, and
they are all based on their historical mythology. That is not to say that bad things haven't actually happened to the
Victim.

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More often than not, Victims have been abused, betrayed, or have suffered some great loss. The problem is that
they have never processed faced their pain, and so it has turned on them. Victims are always looking for someone
to rescue them, because they believe they have suffered enough. They carry a sense of entitlement: "I paid my
dues, look at my battle scars, where's my due"?

3. The Warrior

The Warrior sets out to conquer the money world and is generally seen as successful in the business and financial
worlds. Warriors are adept investors ? focused, decisive, and in control. Although Warriors will listen to advisors,
they make their own decisions and rely on their own instincts and resources to guide them. Warriors often have
difficulty recognizing the difference between what appears to be an adversary and a worthy opponent. A worthy
opponent should be embraced as an opportunity to put down the sword and recognize the potential for growth and
transformation being offered in disguise.

Worthy opponents are most easily recognized as the person with whom you have the greatest conflict. When we
are willing to step back and recognize the lesson and truth this person has to teach, even when it is disguised as
conflict, their presence is worthy of our attention. When we recognize the conflict as an opportunity for growth, our
"opponent" has, in fact, served us. The world is filled with Warrior types, who run the gamut from enjoying the
sport of business and the skillful art of negotiating to those whose single-minded intent is simply to win at any cost.

4. The Martyr

Martyrs are so busy taking care of others' needs that they often neglect their own. Financially speaking, Martyrs
generally do more for others than they do for themselves. They often rescue others (a child, spouse, friend,
partner) from some circumstance or other. However, Martyrs do not always let go of what they give and are
repeatedly let down when others fail to meet up to their expectations. They have formed an unconscious
attachment to their own suffering.

The Martyr moves between two distinctly different energies: one that seeks to be in control and control others and
the other being the wounded, often very needy, child. Martyrs tend to be perfectionists and have high expectations
of themselves and of others, which makes them quite capable of realizing their dreams because they put so much
energy into needing to be right.

Like Victims, Martyrs often live in high drama, experience a lot of highs and lows, and struggle with their
attachment to negative experience. They see the glass as half empty instead of half full. Their focus on the
negative often keeps them from realizing the deep wisdom that lies within their experience. Martyrs who are willing
to do their own work to heal their woundedness have the capacity to become gifted healers and powerful
manifestors -- money Magicians.

5. The Fool

The Fool plays by a different set of rules altogether. A gambler by nature, the Fool is always looking for a windfall
of money by taking financial shortcuts. Even though the familiar adage "a fool and his money are soon parted"

104
often comes true, Fools often win because they are willing to throw the dice; th ey are willing to take chances.

The Fool is really a combination of the Innocent and the Warrior. Like the Innocent, the Fool is often judgment
impaired and has difficulty seeing the truth about things. An adventurer, the Fool gets caught up in the enthusiasm
of the moment, caring little for the details.

The primary difference between Fools and Innocents is that Fools are relatively fearless in their endeavors and
remain eternal optimists regardless of the circumstances. In this manner, Fools are like Warriors in that they seem
to always land on their feet and are not easily defeated. The Fool also sets out to conquer the world but is easily
distracted and lacks the discipline of the Warrior. The Fool is much more interested in money making as a sport or
form of recreation than as a serious endeavor. Fools would happily give the shirt off their backs only to realize later
that it wasn't their shirt or that it was their last.

The Fool does possess some rather remarkable qualities that if mastered make her quite capable of becoming a
Magician. The Fool lives very much in the moment and is quite unattached to future outcome. Most of what Fools
pursue is for the simple pleasure of doing it. Most of us could learn from this characteristic of the Fool.

However, until the Fool becomes enlightened he will continue to attract money easily, only to have it quickly slip
through his fingers because he's simply not paying attention.

6. Creator/Artist

Creator/Artists are on a spiritual or artistic path. They often find living in the material world difficult and frequently
have a conflicted love/hate relationship with money. They love money for the freedom it buys them but have little
or no desire to participate in the material world. The Creator/Artist often overly identifies with the interior world and
may even despise those who live in the material world. Their negative beliefs about materialism only create a
block to the very key to the freedom they so desire.

Creator/artists most fear being inauthentic or not being true to themselves. The Creator/Artist is constantly
struggling for financial survival. This is not because they lack talent or ambition. Rather, they are stuck in a belief
system that disempowers their ability to manifest money. Too many people on the creative or artistic path feel that
money is bad or lacking in spirituality. This is only true to the extent that one believes it is true. And to the extent
that Creator/Artists maintain this belief system, they are limiting themselves and creating a block to the flow of
money.

The Creators/Artists who work to integrate the spiritual with the material world will find an end their struggles.
Since they have often spent much of their time and paid much attention to their inner journeys and creative
potential, Creators/Artists already possesses many of the qualities necessary to become Magicians. This type
most needs to accept the world she lives in and embrace in all its many dimensions.

To stop suffering from the tension we feel between the spiritual and material worlds, we must learn to embrace
both worlds as part of our own duality.

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7. The Tyrant

Tyrants use money to control people, events, and circumstances. The Tyrant hoards money, using it to manipulate
and control others. Although Tyrants may have everything they need or desire, they never feel complete,
comfortable, or at peace.

The Tyrant's greatest fear is loss of control. Tyrants are often overdeveloped Warriors who have become highly
invested in their need for control and dominance. While Warriors are often heroic in their true concern for others'
welfare, Tyrants are purely self interested. This type is interested in power and control for its own sake and will
forsake other people if necessary to gain more of it. Throughout history, the Tyrant has emerged as the ruler who
dominates and destroys with no sign of remorse.

Today Tyrants are the political leaders, businesspeople, or family figureheads who use whatever means
necessary to win at all costs. The Tyrant is a master manipulator of both people and money. Perhaps it's because
the Tyrant type is often the most financially successful image we have in our society that so many of us believe
that money is the root of all evil.

Television and the media do their part to further convince us that although we may think we want more money, we
just need to look at what's become of those who actually have it. It's enough to make anyone hesitate. Tyrants,
however, are not as rich as they appear. Sure, they have everything money can buy (which often does include
beautiful people) and never have to worry about paying the phone bill, but they lack many things that money
cannot buy. They are often, in spite of their apparent success, very fearful and rarely feel any sense of fulfilment.
The Tyrant suffers from a condition I call "chronic-not-enoughness."

8. The Magician

The Magician is the ideal money type. Using a new and ever-changing set of dynamics both in the material world
and in the world of the Spirit, Magicians know how to transform and manifest their own financial reality. At our
best, when we are willing to claim our own power, we are all Magicians. The archetype that is active in your life
now is the place you need to grow from. By understanding your own personal mythology and the history behind
your current money type, you will become conscious of patterns and behavior that are preventing you from having
the relationship with money you desire.

When you have reached the point of understanding and have become aware of all that you need to know at this
point on your journey, you will be ready to transform your newly acquired consciousness into the reality of your life.

The Magician is fully awake and aware of herself and the world around her. The Magician is armed with the
knowledge of the past, has made peace with his personal history, and understands that his source of power exists
within in his ability to see and live the truth of who he is. Magicians know the source of power to manifest lies in
their ability to tap into their Higher Power. With faith, love, and patience, the Magician simply waits in certainty with
the knowledge that all our needs are met all the time.

Magicians embrace the inner life as the place of spiritual wealth and the outer life as the expression of
enlightenment in the material world. They are infinitely connected.

106