Simec: Profiled Debt Free Money

ByShaun Snapp

Executive Summary

  • The simec was an experimental debt-free money designed to prove the social credit or seigniorage theory of money.

Introduction

The Simec was an experimental debt free currency issued by one wealthy individual in named Giacinto Auriti. Auriti was able to prove that a debt free currency was workable and stimulated purchasing.

The Impact of the Simec

The impact of the Simec on the Italian town is described as follows.

“It all began last July, when Professor Auriti, whose family has been wealthy landowners hereabouts for generations, had Simecs printed at his own expense, then distributed them from his palazzo in exchange for Italian lire. He persuaded about 40 local merchants to honor them, promising to redeem each Simec for two lire. Achille Pica, a haberdasher on the main square, described the effect as electric. ”In one day,” he said, after the introduction of the Simec, ”I did the business of one month.” At a redemption rate of two-to-one, Mr. Pica’s shirts, suits and topcoats went for half price. About once a week, he and other merchants hauled their Simecs to Professor Auriti’s palazzo where they were exchanged for lire. Others, like Roberto Sciarretta, who runs a clothing store on the edge of town, said they used Simecs to buy shoes or jewelry. By mid-August, the professor reckons, about 2 billion Simecs, worth $1.9 million at the professor’s exchange rate, were in circulation. But the currency’s rapid spread unsettled local officials, who ordered the financial police to impound the Simecs in circulation. However, a court in Chieti, the provincial capital, soon restored them, arguing that Italian law proscribed counterfeiting the national currency but not printing money of one’s own. An appeal is pending. Today, Professor Auriti estimates that about 700 million Simecs are in circulation, though he says, without elaborating, that they have created liquidity worth 10 billion lire.”

Source: New York Times

https://www.nytimes.com/2001/01/30/business/a-legal-tender-of-one-s-own.html