JAK Interest-free Banking in Sweden

Part 1 - Ethics

This part introduces the JAK bank in a very simple way, and then mostly makes an argument (which we already understand) about why our virtual (exponential, interest-based, debt-based) economy is unethical and ultimately unsustainable.
"Money is produced as a loan, mostly. In the OCD countries, only 3% of the money is produced as coins and notes. The rest of it is debt. And debt has to be repaid with interest. To avoid getting inflation, everything you use money for also has to grow at the same pace as you increase the money. And money has to be increased, because you need to repay the earlier years' debt with interest.

What are the problems linked with and interest based-economy?
The main problem is that it forces people to borrow more money each year in order to pay the interest on the loans they already have. If you dn't do that you have to cut your other expenses in order to pay thie interest, and this means you have to choose between exponential debt growth or a rapid increasing unemployment.

Now in September (2007) the ECB is going to raise again the interest rate on moeny, they say to counteract inflation. But this is quite wrong. I've done some statistical researches that analyze Swedish society over a perioud of 20 years. It very clearly shows that about 4 months after you have raised the interest, you get an increase in invlation, a price increas. And then between 8 and 9 months after a raise of interest, you get an increase in unemployement. And this will ahve an impact on the prices downward, but this downward is not so big as the initial rise of the prices. if you rise the interest by 1%, you will get an increase in inflation about 0.5%."

Part 2 Techniques

0:45 Begins the explanation of the bank. I would like to discuss this, why it works out equivalent to a 2.5% interest rate on the loan.
2:06 Post-saving, or after-saving: The member pays back the loan, and then is allowed to withdraw the resulting savings. It seems that in a way, she gets the money twice.
3:11 Savings are not the same as savings points.

Since there is no interest given to members, won't a member who only saves and doesn't borrow lose money?
Answer at 4:22. The point is supporting the community. When the community is wealthy and stable, everyone benefits. So saving your money in this way is not about individual profit, it's about profiting the whole group, and making the community viable. The JAK bank is mostly staffed by volunteers.
"Loaning as a mutual service among people, that is the financial heresy of JAK bank."

The Basis of Trust

Last week's conversation, Ants, Control and Hierarchy, ended with a short discussion about trust:
-Trust? Why is it hard for people to trust each other?
-Is it natural? Is a genetic thing? Is it about education? Is it culture and subroutines?

Since people wanted to explore this further, today's question is:
What is the basis of trust between human beings?
Here are some answers gleaned from the internet, let's see where this takes us! Click on the headlines to find the article from which the quote or synopsis was taken.

A Definition of Trust
Rousseau and her colleagues offer the following definition: "Trust is a psychological state comprising the intention to accept vulnerability based upon positive expectations of the intentions or behavior of another."[1] Similarly, Lewicki and his colleagues describe trust as "an individual's belief in, and willingness to act on the basis of, the words, actions, and decisions of another."[2]

討論逐字稿 Ants, Control and Hierarchy

This is the transcript from our Ants, Control and Hierarchy discussion.

So can someone summarise our article today?
It talks about ants and human beings.
Okay, the story is about an experiment about how ants' networks work, and compare it to human beings' society.
The first part, the short story is, if Argentinian ants eat the same things as other ants, they think they're friends.
I think what they eat matters so much because they communicate by touch and smell. So maybe for some human beings, they focus on how people dress, in that case what you wear and how you carry yourself is more important than what you eat.

Ants, Control, and Hierarchy

Last week we we spoke about control, and people wanted to continue this discussion. Since some of what we touched on was control within society or a social group, I thought we might look at this article in the Boston Review on ants. Ants are often held up as an example of good social organization, they're thought to be hard workers, and often what we perceive as the organization of ant colonies is used for exploring ideas about human societies, so it might be fun to look at organization and control through this lens.
Here's the transcript from the discussion.

Whether ants fight is determined by whether they share food.
In the early 1990s a group of scientists at the University of California, San Diego introduced the notion that Argentine ants form a super-colony, one enormous colony stretching throughout California. … The force of the idea of the super-colony came from the observation that Argentine ants from different nests rarely fight with each other. The super-colony evoked an image of huge numbers of small brown ants pouring into California from Latin America. The fact that the ants didn’t fight with each other suggested that somehow they were all linked together, and that united they could defeat all the native ants in their path.

But the lack of fighting among Argentine ants does not reveal a collective purpose. Like all ants, the experience of an Argentine ant is largely olfactory and tactile; most of the 11,000 species of ants have very poor vision. An ant is coated with a layer of grease (cuticular hydrocarbons) that carry its colony’s odor, and ants of some species react aggressively to the odor of a different colony. Argentine ants, like some other ant species, are not very sensitive to small differences in odor.

However, scientists recently have discovered that, with sufficient differences, Argentine ants will fight after all. In a laboratory working to develop pesticides, a technician fed some Argentine ants a German cockroach. The result was both unintended and exciting: the cockroach’s odor was incorporated into the ants that ate it, and they were attacked by other Argentine ants that had not eaten the cockroach. When it comes to fighting among Argentine ants, what matters may be whether they have been sharing the remains of Big Macs, not their genetic origins.