managing a currency


[not fully resolved]


if you issue (create) a significnt volume of currency and give it away for free you'll generate inflation 
	(a general rise in prices and a reduction in the value of existing currency holdings)


if you create a significnt volume of currency and allocate the backing items against it it does not generate inflation


some attention should be given to preventing counterfeiting as this would reduce the value of the currency


the value falls somewhat the further that the location is from the source of issuance/exchange for backing


physical notes can be replaced with newly-printed notes without having any affect on inflation or other issues


some economic effects may lead to one person or a small number of people aquiring all the 

currency on issue. this would create the problem of no currency being available for business 

transactions. possible solutions 1% p.a. on currency holdings, banning interest etc.






price pressure

if a paper currency is pegged to several regulated prices, the prices should be consistent with the volume of money and goods.

value of notes = number of physical items / number of notes on issue (not measured exactly, in principle only)

may need prices to be altered or currency issued/cancelled to realign other prices.

for example check against other commodities/rates, and values in general.


to issue currency

small scale
	print and distribute new notes

large scale
	through salaries of govt. employees and social security payments, credit people's bank accounts while making no other changes



to cancel currency

small scale
	collect older notes and don't re-issue them

large scale
	collect taxes by debiting bank accounts (i.e. normal tax collection) and do not credit those amounts anywhere else


keep regulated and non-regulated prices for some pegging commodities to determined price pressure, i.e. if the floating

rate is much higher than the fixed rate, raise the fixed rate or cancel currency, 

if the floating rate is lower than the fixed rate, issue currency or update the fixed rates.





on-going issues

ensure that there is no theft in the banking system, by other customers or otherwise

be aware that due to natural effects it's likely that all the money will end up with one person or organisation, or a small number

	of entities, and it may be necessary to have some taxes, forced spending or investing, to return some money to circulation,


try to avoid excessively high prices for food items etc. through effective competition and possibly regulating prices


it is not intentional that people accumulate large amounts of physical cash (over $10M), large balances in bank accounts are ok 

however it's expensive to produce the notes, if this happens try to return these notes into circulation, 

(exchange for land, record a bank balance, etc). large amounts for the purposes of completing a transaction are ok.




