The URA: Our own Fixed Value currency

Logo URA CurrencyBefore giving more details about the URA, we would like to explain the principle and the value of money. When we make this clear,  we can explain how we plan to implement the URA. If you only want to know how the URA works, please click on: The way the URA works in practice.

The value of money
We are the only ones who can attribute value to something. Products will only have value when it has passed through our hands. Take gold for example. Gold is worth nothing when it is buried in the ground, only after hours of labour extracting it, it becomes valuable. Through time and labour, we produce items for ourselves and for each other. Then, we express the time and labour spent to produce these items by the means of exchange called money.

The value of a pot of jam
Equally, in the case of a pot of jam, the value is determined by the hours and labour needed to produce it. Fruits are harvested, and its cost is measured in hours and labour. The machines needed to produce the jam also have a value that can be expressed in hours and labour. This value (investment) is divided over all the individual jars. The commodities needed to produce the machines have a value as well because it took hours and labour to mine them.

Yet this jar of jam is subject to price increases. Every year the jar, produced with the same hours and (labour, the hours and labour we put into it), becomes more expensive. However, the prices don’t increase because they need more hours and labour, but because our money decrease in value due to inflation. When we zoom in on price increases, we see that companies have to pay interest upon interest on their loans. The example below will show the current system in a simplified way.

Example on an (almost) uninhabited island
Our current monetary system is based on debt and interest. Without debt creation there would be no money in circulation. In the following simplified story, our current system is explained. The island has 10 inhabitants. At a certain moment a banker, who is passing by, introduces money as a very convenient way of exchange to the islanders. He then loans 100 units to every person, so there will be 1000 units in circulation in total. In order to use the money, the islanders have to pay the banker a 5% interest per year. So, at the end of the first year, everybody must pay back 5 units to him.

Because there are only 1000 units in circulation, and the banker receives 50 units back in interest, at the end of the first year there are only 950 units left in circulation. Now, for the first time, there is a shortage created in the number of circulating units. To get the total back to 1000 units the banker makes another loan of 50 units. Thus, he is constantly loaning money. Consequently, the 10 islanders are constantly taking on debt upon debt and interest upon interest. This will continue for a while without any problems, but it will create bubbles and crises, as we now see happening in our current system.

The currency that we are going to use in a closed and cooperative circle, will be called URA. One might even expect it to become a global umbrella currency. It is our new gold, which will be stable and have a fixed value. The URA will, in fact, be tied to hours and labour (Uren en ARbeid = URA, in Dutch). One hour of labour produced today will still be one hour of labour in 10 years’ time. The URA will, therefore, have a more stable and fixed value than gold. This will happen because all the investments made under and with the URA will benefit the Real Economy and will yield Financial, Ecological, Emotional and Social (F.E.E.S.) returns on the capital.

That means investments in raw materials/commodities, fair business practices, biological foods, natural energy resources, real estate, clean water, and people. These investments will be beneficial to mankind who will continue to use them. In the first stage, incoming euros can be exchanged based on one for one against URA's. In this way, the URA will be invested in a fair and sustainable investment programmes that, due to euro inflation, will yield (F.E.E.S.) return on capital. B of Joy members can pay everywhere in euros and URAs, via internet, mobile phone, debit card or chip card.

The way the URA works in practice

If people so wish, the local currency URA will eventually become a global umbrella currency. In practice, this means that the URA will pass through different stages of implementation, so it can develop into a fully established currency.

First Stage
In the first stage, the euros received will be exchanged without any charge on a 1 to 1 basis for URAs. These URAs can be used in the closed cooperative circuit.  The euros received will be invested, among other things, in raw materials, natural energy sources, fair and just entrepreneurship, and people. At that point, an underlying value is created (coverage) for the URA’s. All the circulating URAs in the circuit are, therefore, covered by an underlying value which, in the end, is related to Hours of Labour (Uren ARbeid, in Dutch). The entire URA’s system is interest-free.

People find value in things that command mutual trust. Therefore we choose to give the URA this underlying value. People will always have a use for these underlying values and they are interest-free. The sun is the sun and cotton are cotton. This is also why we use the term “fixed value” regarding the URA. If in the future, more than 1 euro is needed to obtain 1 URA, this will be due to the inflation and interest on the euro. More info.

The members of the closed cooperative circuit will exchange their products and services directly, or otherwise, via a business directory, Marketplace, and collective purchasing. Through a central administration system, all URAs will be credited and debited. Members can also offer the supply and demand of their products outside the closed circuit. When making a purchase outside of the circuit, URAs can be exchanged for euros. In this case, the cost of exchange is 1%. For amounts of 250 euro and above, the exchange period is comparable with purchasing on invoice, 1 to 4 weeks. This is the time needed to exchange the underlying value of the URA into euros again.

Second Stage
As the turnover from euros to URAs increases, so will the collective investment programmes in the underlying valuables grow. The basket of investments in raw materials, natural energy sources, just and fair entrepreneurship and people not only has a stable value but will also produce returns. For the URA that is stage 2. The value of the URA will rise against the euro. At that point, the 1 to 1 exchange rate between euros and URA will be let loose. From this moment on, there will be a “real time” exchange rates calculated, on the grounds of the basket of underlying value against the euro. The advantages are:

• When making digital payments in euros there will be increasingly less URAs debited;
• The euros, created from thin air and based on debt, will obtain some real value via the URA.

Third Stage
As soon as the euro falls into hyperinflation or a total crash, (almost) nobody will want to exchange their URAs for euros. At that point, the URA will be fully independent of the euro and we will enter stage 3. Money creation can take place based on production (hours of labour) instead of debt, our current system. This can take place within a national cooperative that operates under the complete control and management of the society itself. More info.

The size and growth of the money's stock would be monitored and held in balance in relation to Gross Domestic Product (GDP). In this way, the optimal stock of money needed will be present, as means of exchange for everything that we, as a society, wish to trade in products and services. Money would circulate interest-free. We will then make the full transition to a circular economy if that isn’t already the case.

In the Annual General Meeting of the national cooperative, we will redefine the value of URA (hours of labour) in agreement with all the members involved. How many URA would a gardener or an airline pilot earn? How much should a garbage collector earn? A doctor? That will be decided together, to achieve a suitable evaluation for the URA value of each profession. When you peel off all layers it comes down to this:

The URA’s value is based on the production we deliver in hours and labour. In the 12 points of change: 3, 4, 5, 6 and 11, you can read in a broader context what we will do locally via the cooperative. In addition to a re-evaluation of hours of labour for each profession, there will be also a general sharing of the yield, returns on capital, for all the member who holds a certificate. In this way, everybody involved has an interest to see that the cooperative functions optimally in every aspect. The URA is not the ultimate answer but brings the possibility to build a bridge towards a new system where cash becomes commonplace once again.