What Happens If You Print Your Own Money?

In 1932 an Austrian town printed money that lost value if you held on to it. Within a year it had paved its streets and built a bridge, and two hundred other towns had written asking to copy it. Then the central bank made it illegal - and not because it had failed. This video is about what money actually is, and what happens to anyone who tries to make their own. Stone discs too heavy to carry, one of them lying on the sea floor and still counted as wealth. Notched sticks that carried England's debt for six centuries and burned down Parliament on their way out. A man the prosecution called a domestic terrorist for minting silver. None of it is a conspiracy. All of it is on the record. 0:00 - The town that printed money designed to rot 0:47 - A railwayman who had read one book 1:31 - Yap: the money that never moved 2:52 - Six hundred years of wooden money 3:48 - The night Parliament burned down 4:31 - The ninety-seven percent that is only a number 5:23 - Cantillon: who touches new money first 6:26 - Why the answer is never economic 7:16 - Ninety thousand hours WHAT YOU WILL LEARN Wörgl, 1932: a banknote that lost one percent of its value every month unless you bought a stamp and glued it to the back. Money that punished you for holding it. When the central bank shut it down, the argument was never that the money was bad. The argument was that issuing money at all was the crime. The island of Yap, where a family was counted as wealthy because of a stone that had sunk at sea generations earlier and that nobody alive had ever seen. English tally sticks: you kept the long half, called the stock - which is where the word stockholder comes from. Burning the old ones in 1834 took the Palace of Westminster with them. Physical cash is around three percent of the money supply. The other ninety-seven percent is typed into existence as debt, at interest. The Cantillon effect: new money enters at a point, and whoever touches it first spends it at yesterday's prices. Nobody steals anything. Distance from the source does the work. SOURCES Wörgl, 1932-33: Unterguggenberger Institut, "The Free Economy Experiment of Woergl"; Bernard Lietaer, "The Wörgl Experiment". The Institut records unemployment in the town falling 16% over the year while it rose 19% across Austria. Shut down by the Austrian National Bank on 1 September 1933. Yap: W. H. Furness III, "The Island of Stone Money", 1910, from his visit in 1903. Milton Friedman later built his own essay on it. Tally sticks and the 1834 fire: UK Parliament, "Tally Sticks" and "Destruction by fire, 1834", parliament.uk The Cantillon effect: Richard Cantillon, "Essai sur la Nature du Commerce en Général", published 1755, twenty-one years after his death. Executive Order 6102, signed 5 April 1933: US National Archives. e-gold: US Department of Justice press release 07-301, 2007. Liberty Dollar: United States v. von NotHaus, W.D.N.C. 5:09CR27, convicted March 2011. The "unique form of domestic terrorism" line is from US Attorney Anne Tompkins announcing the verdict.