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The following movie shows the real evolution of money and its flaws.
Similarities with real persons and circumstances are deliberate and not a coincidence.
Neue Impulse e.V. presents:
with kind support of following:
A Michael Kent production
The story of Fabian, the goldsmith
Why is money always missing?
Give me the world or 5 % –
Based on a story from Larry Hannigan
Drawings: Ralf Alex Fichtner
Voice: Kai Taschner
Director and animation: Christoph Lehmann
Fabian was excited as he once more rehearsed his speech
for the crowd certain to turn up tomorrow.
He had always wanted prestige and power
and now his dreams were going to come true.
He was a craftsman
working with silver and gold, making jewelry and ornaments,
but he became dissatisfied
with working for a living.
He needed excitement, a challenge,
and now his plan was ready to begin.
For generations the people
used the barter system.
A man supported his own family
by providing all their needs
by his own farms,
or else he specialised in a particular trade.
Whatever surpluses he might have from his own production,
he exchanged or swapped for the surplus of others.
Market day was always noisy and dusty,
yet people looked forward to the shouting and waving,
and especially the companionship.
It used to be a happy place, but now
there were too many people, too much arguing.
There was no time for chatting –
a better system was needed.
Generally, the people had been happy,
and enjoyed the fruits of their work.
Government was very simple:
In each community a simple Government
had been formed to make sure
that each person's freedoms and rights were protected
and that no man was forced to do anything
to do anything against his will by any other man,
or any group of men.
This was the Government's one and only purpose
and each Governor was voluntarily supported
by the local community who elected him.
However, market day was the one problem
they could not solve.
Was a knife worth
one or two baskets of corn?
Was a cow worth more than a wagon …
and so on.
No one could think of a better system.
Fabian had advertised,
"I have the solution to our bartering problems,
and I invite everyone to a public meeting tomorrow."
The next day there was a great assembly in the town square
and Fabian explained all about the new system
which he called "money".
It sounded good.
"How are we to start?"
the people asked.
"The gold which I fashion into
ornaments and jewelry is an excellent metal.
It does not tarnish or rust,
and will last a long time.
I will make some gold into coins
and we shall call each coin a dollar."
He explained how values would work,
and that "money" would be really
a medium for exchange –
a much better system than bartering.
One of the Governors questioned,
"Some people can dig gold and make coins for themselves"
he said, "This would be most unfair".
Fabian was ready with the answer.
"That shall be illegal!
Only those coins approved
by the Government can be used,
and these will have special markings stamped on them."
This seemed reasonable
and it was proposed that each man
be given an equal number.
"But I deserve the most,"
said the candle-maker.
"Everyone uses my candles."
"No", said the farmer,
"without food there is no life,
surely we should get the most."
And so the bickering continued.
Fabian let them argue for a while
and finally he said,
"Since none of you can agree,
I suggest you obtain
the number you require from me.
There will be no limit,
except for your ability to repay.
The more you obtain,
the more you must repay in one year's time.
"And what will you receive?"
the people asked.
"Since I am providing a service,
that is, the money supply,
I am entitled to payment for my work.
Let us say that for every
100 pieces you obtain,
you repay me 105 for every year
that you owe the debt.
The 5 will be my charge,
and I shall call this charge interest."
There seemed to be no other way,
and besides, 5% seemed little enough charge.
"Come back next Friday and we will begin."
Fabian wasted no time. He made coins
day and night, and at the end of the week he was ready.
The people were queued up at his shop,
and after the coins were inspected and approved by the Governors
the system commenced.
Some borrowed only a few
and they went off to try the new system.
They found money to be marvellous,
and they soon valued everything
in gold coins or dollars.
The value they placed on everything was called a "price",
and the price mainly depended on the amount of work
required to produce it.
If it took a lot of work
the price was high, but if it
was produced with little effort it was quite inexpensive.
In one town lived Alan,
who was the only watchmaker.
His prices were high because the customers
were willing to pay just to own one of his watches.
Then another man began making watches
and offered them at a lower price in order to get sales.
Alan was forced to lower his prices,
and in no time at all prices came down,
so that both men were striving
to give the best quality at the lowest price.
This was genuine free competition.
It was the same with builders, transport operators,
accountants, farmers, in fact,
in every endeavour.
he customers always chose what they felt was the best deal –
they had freedom of choice.
There was no artificial protection
such as licences or tariffs
to prevent other people from going into business.
The standard of living rose, and before long the people
wondered how they had ever done without money.
At the end of the year, Fabian left his shop and visited
all the people who owed him money.
Some had more than they borrowed,
but this meant that others had less, since there were only
a certain number of coins issued in the first place.
Those who had more than they borrowed
paid back each 100 plus the extra 5,