WEBVTT - How Bartering Works 0:00:00.280 --> 0:00:02.840 Brought to you by the reinvented two thousand twelve camera. 0:00:03.160 --> 0:00:07.560 It's ready. Are you welcome to Stuff you should know 0:00:08.160 --> 0:00:16.479 from House Stuff Works dot Com? Hey, and welcome to 0:00:16.520 --> 0:00:20.159 the podcast. I'm Josh Clark with a barely awake Charles W. 0:00:20.320 --> 0:00:25.200 Chuck Bryant. Who's drowsy? I'm not drowsy. You look drowsy? Really, Yeah, 0:00:26.560 --> 0:00:28.680 that's totally different. When you get to be forty, you 0:00:28.720 --> 0:00:31.120 just you look drowsy all the time. Are you rested? 0:00:31.720 --> 0:00:34.960 I just woke up? Crud? Yeah, I got something to 0:00:35.000 --> 0:00:38.560 look forward to all downhill, buddy, I'll tell you something 0:00:38.640 --> 0:00:42.320 that the prisoners in Florida's state penal system have something 0:00:42.360 --> 0:00:47.440 to look forward to, springs off fall. In addition to that, okay, 0:00:48.120 --> 0:00:52.880 buying honey buns at the commissary? Is that? Is that 0:00:52.960 --> 0:00:55.720 the new guy on sub black Sea? You know what 0:00:55.840 --> 0:00:58.400 I wrote about this, and somebody had a funny comment 0:00:58.480 --> 0:01:02.640 like that honey buns joke? Yeah, uh no, which is 0:01:02.720 --> 0:01:05.800 really terrible joking. I think about it, but um no 0:01:06.160 --> 0:01:09.600 actual honeybuton you know, like the pastry dessert. It's the best. 0:01:09.680 --> 0:01:12.800 Love it, do you? It depends on which brand you're 0:01:12.800 --> 0:01:15.039 talking about. In my opinion, Krispy Kreme honey buns are 0:01:15.080 --> 0:01:19.360 pretty rocking. I never tried about are they frosted? Oh, 0:01:19.440 --> 0:01:23.440 I've got to try one of those. I had no idea. Yeah, wow, Okay, Well, 0:01:23.480 --> 0:01:26.440 the ones I'm talking about coming cellophane. They're sold for 0:01:26.440 --> 0:01:30.399 about a buck or so UM in prison, so you know, 0:01:30.480 --> 0:01:32.840 it's not the greatest brand on the planet probably probably 0:01:33.360 --> 0:01:37.240 um And apparently in Florida, I think around the country, 0:01:37.240 --> 0:01:40.560 but in Florida in particular, they're like the new prison currency. 0:01:40.640 --> 0:01:43.800 Honey buns are because it's a new product that people 0:01:43.840 --> 0:01:46.440 just crave. No, it's just been kind of quietly building 0:01:46.520 --> 0:01:48.960 up over time, and everybody's been making the cigarette joke 0:01:49.080 --> 0:01:52.840 for decades and didn't noticed that, actually tobacco is out 0:01:52.880 --> 0:01:55.680 sold in the in the Florida State penal system by 0:01:55.720 --> 0:02:00.000 honey buns. Everybody loves a honeybun. Yeah, so we're envelope. 0:02:01.240 --> 0:02:05.080 They're like the number one seller in state prisons in 0:02:05.120 --> 0:02:08.839 the county. In the county lock up, uh free dried 0:02:08.880 --> 0:02:12.800 coffee and ramen noodles still outsell honeybuts. But if you're up, 0:02:12.840 --> 0:02:16.120 if you're up the river in the state, honey buns 0:02:16.160 --> 0:02:18.640 are number one. Wow, and then envelopes because people are 0:02:18.680 --> 0:02:22.360 clearly like to write their letters, right, yes, or they 0:02:22.440 --> 0:02:25.760 use envelopes as napkins for hunting buns. It's just dumb 0:02:25.800 --> 0:02:28.080 if it seems like they would give them envelopes. Come on, 0:02:28.080 --> 0:02:30.520 if these guys are gonna take the time to write, somebody, 0:02:31.360 --> 0:02:34.320 give them an envelope. No, you gotta buy it, Yeah, 0:02:34.520 --> 0:02:41.359 with your thirty five cents an hour making license plates anyway. Um, 0:02:41.840 --> 0:02:47.280 so these honey buns are They're used as bribes for protection. Um. 0:02:47.320 --> 0:02:52.440 They're used in exchange for other food items, maybe some 0:02:52.560 --> 0:02:55.400 envelopes if you're running low. Right, they're used for bets 0:02:55.440 --> 0:02:59.519 as wagers. Seriously, there's a really cool article in St. 0:02:59.520 --> 0:03:01.920 Petersburg Times that was really well written about it. Right, 0:03:02.760 --> 0:03:05.080 but what these people are doing, Let's say in the 0:03:05.120 --> 0:03:09.840 case of a bribe, Let's say, um, Todd, the white 0:03:09.840 --> 0:03:13.640 collar criminal who somehow ended up in a state prison, 0:03:14.120 --> 0:03:18.200 is paying Tiny, the ironically named huge guy, for protection 0:03:18.440 --> 0:03:23.919 in honey buns. What's going on there is bartering. Todd 0:03:24.440 --> 0:03:31.640 is bartering a honey bun in exchange for Tiny's service protection, 0:03:32.480 --> 0:03:35.240 beating the tar out of guys who want to take 0:03:35.480 --> 0:03:39.720 Todd's honey buns or he himself not doing that with 0:03:39.840 --> 0:03:42.640 his own cronies. Now that's a racket, that's that's not 0:03:42.680 --> 0:03:47.080 necessarily the same thing. Oh yeah, still trading without money, 0:03:47.200 --> 0:03:50.560 I guess. So okay, So, so we've finally reached the 0:03:50.720 --> 0:03:54.040 end of that god awful intro and we're now talking 0:03:54.040 --> 0:03:59.160 about bartering, Chuck bartering new or old old old as 0:03:59.160 --> 0:04:03.640 the hills, Uh, the earliest civilizations. Josh bartered for stuff 0:04:03.680 --> 0:04:07.320 because there was no currency back in the day. So, 0:04:07.440 --> 0:04:11.200 I mean, you know, caveman took took that. We always 0:04:11.200 --> 0:04:14.880 talked about cooktok trades. Uh, you know animal pelt for 0:04:15.720 --> 0:04:19.520 spear made from rhino horn. Yeah, because he's he's like, 0:04:19.560 --> 0:04:20.960 I've never seen one of those, but I've got all 0:04:20.960 --> 0:04:23.440 these great pelts, and you look a little cold. So 0:04:23.520 --> 0:04:27.440 let's work out a deal here parting it is, And 0:04:27.680 --> 0:04:30.839 you're absolutely right, it is pretty old. Um. It really 0:04:30.839 --> 0:04:35.400 started to take off after we left our hunter gatherer roots, though. Yeah, 0:04:35.440 --> 0:04:37.760 once we settled down into communities. Yeah, it made a 0:04:37.760 --> 0:04:41.120 lot more sense. Um, you might be some sort of 0:04:41.160 --> 0:04:44.160 farmer and end up with a surplus. You've got all 0:04:44.279 --> 0:04:47.800 the grain you need, but you need some meat too, 0:04:48.560 --> 0:04:50.479 And this guy over here has some pigs that have 0:04:50.600 --> 0:04:53.240 been looking pretty delicious lately. So you trade them some 0:04:53.279 --> 0:04:55.600 of your surplus grain for a pig, and the guy 0:04:55.640 --> 0:04:58.320 who has pigs gets some of your grain, and he 0:04:58.360 --> 0:05:03.359 has pigs. You have pigs and grain to everybody's happy. Yeah, 0:05:03.560 --> 0:05:05.600 Jerry thinks this whole thing is funny for some reason. 0:05:06.960 --> 0:05:09.040 Uh yeah, I mean that's how it all started. I 0:05:09.120 --> 0:05:12.600 actually did a report in um elementary school. We had 0:05:12.640 --> 0:05:16.400 to social studies report where we had to devise a 0:05:16.440 --> 0:05:18.720 city of our own, like a town, and we had 0:05:18.720 --> 0:05:20.560 to construct you know, how it all looked at and 0:05:20.560 --> 0:05:22.520 what they did. And I was the only kid who 0:05:22.600 --> 0:05:26.080 had a barter system instead of money. The teacher thought 0:05:26.120 --> 0:05:28.000 at the time that that was very you know, a 0:05:28.080 --> 0:05:29.760 very smart kid for doing that, because I was, you know, 0:05:29.800 --> 0:05:32.159 like nine years old. Every once a while, you just 0:05:32.240 --> 0:05:35.479 kind of like drift off while you're taking a shower 0:05:35.720 --> 0:05:38.640 thinking about the congratulations the teacher gave you that day. 0:05:38.960 --> 0:05:43.120 That was my last one congratulations chuck. So that has 0:05:43.120 --> 0:05:45.000 stuck with me all these years though, that it's funny 0:05:45.000 --> 0:05:47.240 that as a little kid, I thought bartering was kind 0:05:47.279 --> 0:05:50.120 of a cool system, and it and it was and 0:05:50.160 --> 0:05:52.400 it still is. We'll find out. Yeah, um, there's a 0:05:52.480 --> 0:05:55.440 there's a lot of cool. Maybe cool is not the 0:05:55.520 --> 0:05:57.960 right word. I don't think cool is an economics term, 0:05:58.360 --> 0:06:02.159 but there's it has a lot of benefits and that uh, 0:06:02.400 --> 0:06:08.320 Bartering generally doesn't lead to surplus, right, it leads to 0:06:08.520 --> 0:06:11.320 um basically people just having what they need. Yeah, you're 0:06:11.320 --> 0:06:13.920 exchanging something you need or something you have that someone 0:06:13.960 --> 0:06:16.719 else needs for something that you need. And in most cases, 0:06:17.040 --> 0:06:19.640 most cases, you don't want a whole lot of leftovers. 0:06:19.960 --> 0:06:22.400 You just kind of you have something that you're willing 0:06:22.440 --> 0:06:26.159 to exchange for something else. Everybody's seeking an even trade, 0:06:26.480 --> 0:06:29.800 so nobody's giving anybody a lot more than they need 0:06:30.839 --> 0:06:33.720 or you know, conversely screwing the other person over and 0:06:34.120 --> 0:06:37.000 taking as much as possible because both parties have to 0:06:37.040 --> 0:06:39.839 be cool with it. Right, there's no trade, so there's 0:06:39.880 --> 0:06:42.200 not a lot of surplus. Not a lot of surplus. 0:06:42.440 --> 0:06:45.600 To anyone who's read Jared Diamonds, the greatest mistake in 0:06:45.640 --> 0:06:48.760 the history of the human race means that you don't 0:06:48.760 --> 0:06:52.320 necessarily have anybody who's in charge or has control over 0:06:52.360 --> 0:06:58.440 other people. By controlling the surplus interesting very well. When bartering, Josh, 0:06:58.480 --> 0:07:01.479 it's everything's relative obviously, because if you need if you 0:07:01.520 --> 0:07:06.600 live someplace where it's cold and you need more shelter blankets, 0:07:06.640 --> 0:07:09.360 let's say or whatever, or let's modernize and say heater, 0:07:09.440 --> 0:07:12.720 or then that's going to be pretty valuable to you. Right. Um, 0:07:12.840 --> 0:07:16.000 what you're talking about is the relative value of an item, 0:07:16.080 --> 0:07:19.600 right exactly. So like in a money system, like there's 0:07:19.600 --> 0:07:22.880 a fixed value to the dollar, and it fluctuates, you know, 0:07:22.920 --> 0:07:26.560 there's inflation and deflation and stag inflation. But ultimately, when 0:07:26.560 --> 0:07:29.680 you're coming to somebody with a dollar, you both have 0:07:29.760 --> 0:07:32.920 an agreed upon awareness of what that dollar's worth, which 0:07:32.960 --> 0:07:35.680 is a dollar, Like you were saying, with a heater, 0:07:36.320 --> 0:07:39.080 somebody who lives in a hot climate is going to 0:07:39.160 --> 0:07:41.240 value that thing less than somebody who lives in a 0:07:41.280 --> 0:07:44.040 cold climate. So the person in the cold climate would 0:07:44.040 --> 0:07:46.760 be willing to pay more or trade more for that 0:07:47.160 --> 0:07:51.560 relative value. It's the distinction between um, bartering and money, 0:07:51.920 --> 0:07:55.160 one of them, um, but the main one. It's my favorite. 0:07:56.200 --> 0:07:58.320 Timing is another big deal when it comes to bartering, 0:07:58.360 --> 0:08:01.280 because depending on when this is happening and what your 0:08:01.320 --> 0:08:04.320 situation is things canna have a different value. Uh. The 0:08:04.400 --> 0:08:07.040 article used an example of Richard the third my Kingdom 0:08:07.040 --> 0:08:10.320 for a horse when he was in a battle. Uh. 0:08:10.360 --> 0:08:12.040 I was on a hike in Utah one time where 0:08:12.080 --> 0:08:14.600 I would have paid a thousand dollars for a bottle 0:08:14.600 --> 0:08:18.760 of gatorade or lift down the hill and I wanted 0:08:18.800 --> 0:08:22.480 the gatorade? Was that hot and dehydrated? Yeah? It was bad? 0:08:22.600 --> 0:08:26.280 Did you were you hospitalized? Now? Now we we hiked 0:08:26.320 --> 0:08:27.960 out and made it to the spot and bought like 0:08:28.000 --> 0:08:30.720 five gatorades and drank them all. Your urine was just 0:08:30.800 --> 0:08:33.360 chunky style, A little bit came out, a little pebbles. 0:08:34.679 --> 0:08:36.400 Uh So Yeah, timing has a lot to do with 0:08:36.440 --> 0:08:38.880 the value of something as far as how much you 0:08:38.960 --> 0:08:43.040 might need that item. Yeah. And Jane McGrath wrote this one. Jane, 0:08:43.200 --> 0:08:45.560 she did a good job to remember Jane. Yeah, let 0:08:45.600 --> 0:08:49.680 me ask you this, what about when it's not just 0:08:49.720 --> 0:08:52.880 a one to one deal, Like you've got corn and 0:08:53.080 --> 0:08:57.040 your friend, uh, Ralph next to your farm has cows. 0:08:58.040 --> 0:09:01.160 But Ralph doesn't want corn, he wants wheat. But your buddy, 0:09:01.520 --> 0:09:04.560 your Yeah, your buddy Pete has wheat, so you want 0:09:04.600 --> 0:09:07.199 you can arrange a little three way trade there if 0:09:07.240 --> 0:09:10.880 you're an innovative guy, and it's called a triangular barter. 0:09:11.640 --> 0:09:14.679 And NBA teams do this. Any sports team can, but 0:09:14.720 --> 0:09:18.600 it happens more than NBA than anywhere else and stuff, 0:09:18.679 --> 0:09:20.920 well just trading players like you know, I want your center, 0:09:21.440 --> 0:09:23.360 but you don't want my point guard. You want there forward, 0:09:23.679 --> 0:09:25.880 but I'll take their forward and package it in such 0:09:25.880 --> 0:09:29.600 a way that it's accommodates everybody. Huh. So that's a 0:09:29.600 --> 0:09:33.720 triangular barter, which so you you you are pointing something 0:09:33.720 --> 0:09:37.040 out and that it's not necessarily the most common thing 0:09:37.080 --> 0:09:40.920 in a barter economy where you have something that I 0:09:41.000 --> 0:09:43.199 need and I have something that you need at that 0:09:43.280 --> 0:09:45.280 moment too. That well, that's what works because we talked 0:09:45.280 --> 0:09:48.319 about timing and relative value, right, that's one of the 0:09:48.360 --> 0:09:50.880 downsides of the barter. And it gets even more complex 0:09:50.920 --> 0:09:53.240 than a triangular barter. That's a lot of work, you know, 0:09:53.400 --> 0:09:57.800 that's a lot of walking. You know, Um, if you 0:09:57.840 --> 0:10:01.600 find that third person and so, um Ralph has that 0:10:01.679 --> 0:10:05.040 cow you want, Pete has wheat, You have corn, but 0:10:05.120 --> 0:10:07.520 Pete doesn't want your corn. You're gonna have to go 0:10:07.559 --> 0:10:10.760 find somebody who wants your corn who has something that 0:10:11.160 --> 0:10:16.000 Pete would want, yes or more, which is called the 0:10:16.040 --> 0:10:19.080 multilateral trade. You can see it gets kind of convoluted 0:10:19.120 --> 0:10:22.120 as well. You know, well, and when it gets convoluted, 0:10:22.280 --> 0:10:25.600 there's a greater risk for making a bad deal just 0:10:25.679 --> 0:10:27.640 to get it over with, just because you really need 0:10:27.720 --> 0:10:30.640 that cow. And that's one of the you know, we'll 0:10:30.640 --> 0:10:33.560 talk about the downside. It is certainly one of them. Yeah, well, 0:10:33.640 --> 0:10:36.640 well I think we kind of are all are we 0:10:36.679 --> 0:10:39.720 already there? Okay? Well, that's one of the downsides is 0:10:39.760 --> 0:10:41.640 that a lot of work goes into this, and in 0:10:41.679 --> 0:10:43.840 the end you might settle for less than a great 0:10:43.880 --> 0:10:47.000 deal because it's there's so much work involved. Um, there's 0:10:47.040 --> 0:10:49.720 some other factors that might force you to settle for 0:10:50.280 --> 0:10:55.480 poo poo deal, and that is um, time works against you. 0:10:56.280 --> 0:10:59.000 You remember we kind of used the example of you 0:10:59.120 --> 0:11:03.679 with the gatorade. Yeah, yeah, right, Um, were you somebody 0:11:03.720 --> 0:11:05.960 who had something to trade for that gatorade at that 0:11:06.040 --> 0:11:08.720 moment and somebody came along with gatorade and gouged you? 0:11:09.360 --> 0:11:13.120 Say you had tomatoes to trade, right, You kind of 0:11:13.160 --> 0:11:15.640 need to trade your tomatoes because they're a perishable item. 0:11:16.240 --> 0:11:18.640 So time is working against you, so you might take 0:11:18.640 --> 0:11:21.079 a bad trade. It's just to get rid of these tomatoes, 0:11:21.200 --> 0:11:23.920 right right, or in the article example is a great one. 0:11:23.960 --> 0:11:27.880 Let's say you're a craftsman. You build these great banquet tables. 0:11:28.480 --> 0:11:31.360 Banquet tables are big and heavy. You go to trade 0:11:31.360 --> 0:11:34.000 for tomatoes because you really need those tomatoes. And the 0:11:34.040 --> 0:11:37.160 guy was like, hey, you know, I mean, I'll give 0:11:37.200 --> 0:11:39.599 you fifteen tomatoes, and I was like, no, this is 0:11:39.600 --> 0:11:41.360 worth like three hundred tomatoes. But what are you gonna 0:11:41.360 --> 0:11:44.320 do with three hundred tomatoes. So it's when you don't 0:11:44.360 --> 0:11:47.800 have equal You've got a lot of small things, you 0:11:47.880 --> 0:11:49.959 have one large thing. You're kind of in trouble. I 0:11:49.960 --> 0:11:52.760 don't know if you pick the right business model. Yeah, 0:11:52.880 --> 0:11:55.000 as a craftsman, and even if you even if you 0:11:55.040 --> 0:11:59.080 did take, uh, three hundred tomatoes, you're gonna run around, 0:11:59.080 --> 0:12:03.160 you know, trying to trade those surplus tomatoes for you know, 0:12:03.360 --> 0:12:06.360 um other stuff you may or may not need, which 0:12:06.480 --> 0:12:08.920 when you could be building tables. You should be building tables. 0:12:08.920 --> 0:12:12.640 It's what you do, it's what you're good at. Yeah, exactly. 0:12:12.679 --> 0:12:15.760 So that's because you know, bartering initially sounds like, oh 0:12:15.760 --> 0:12:18.760 that's so great. You just trade things and there's no money, 0:12:18.800 --> 0:12:22.120 and money leads to badness. But it's not that simple. 0:12:22.840 --> 0:12:25.480 It's rare that you just find that perfect match and 0:12:25.600 --> 0:12:28.160 perfect timing to work out in a wonder one trade 0:12:28.640 --> 0:12:33.080 and then establishing that that value considering that everything in 0:12:33.120 --> 0:12:36.960 a barter system has a relative value. You know, there's 0:12:37.400 --> 0:12:40.160 as Jane put it, you know, comparing apples to oranges 0:12:40.880 --> 0:12:44.560 is still comparing you know, fruit of roughly the same 0:12:44.559 --> 0:12:48.719 shape and size. She yeah, she points out that it's 0:12:48.720 --> 0:12:50.760 a terrible thing. It's like the low man on the 0:12:50.760 --> 0:12:53.040 totem pole. Yeah. I gonna start saying, Uh, that's like 0:12:53.080 --> 0:12:56.920 comparing cows to table legs exactly. People like, what the 0:12:56.960 --> 0:12:58.520 heck are you talking about? You just be like, listen 0:12:58.520 --> 0:13:04.040 to the podcast exactly. So chuck Um. Because our ancestors 0:13:04.080 --> 0:13:09.000 are four people, UM ran into these problems where they 0:13:09.000 --> 0:13:12.760 couldn't figure out how many tomatoes equal the table, and 0:13:12.800 --> 0:13:15.800 when they did, it just was way too much. They 0:13:15.800 --> 0:13:19.240 got tired of lugging tables around. Um. They came up 0:13:19.280 --> 0:13:22.520 with something that we call money currency and it solved 0:13:22.520 --> 0:13:25.360 a lot of problems for all of its drawbacks and 0:13:25.440 --> 0:13:29.359 ills and evils. Uh, money solved a lot of problems. 0:13:30.040 --> 0:13:33.760 It's easier to carry money around than a table, for one. Yeah, 0:13:33.880 --> 0:13:36.360 think about how much a hundred dollar bill ways. Not much, 0:13:36.960 --> 0:13:39.240 not very much. It sits heavy in my pocket, though, 0:13:39.280 --> 0:13:43.920 my friend, it burns mine, It burns all. It can 0:13:43.960 --> 0:13:47.720 also be divided pretty easily. Sure, you know a hundred 0:13:47.800 --> 0:13:53.240 one dollar bills still isn't as heavy as a table, right, Yeah, well, 0:13:53.240 --> 0:13:55.240 and it levels of playing field, like you said said, 0:13:55.240 --> 0:13:58.960 then you don't have to compare tomatoes to tables. It's 0:13:59.120 --> 0:14:00.960 pretty easy to set your price. If people want to 0:14:00.960 --> 0:14:03.040 buy it, great, then you got your dough and you 0:14:03.040 --> 0:14:05.200 can just buy your two tomatoes for dinner that night. 0:14:06.360 --> 0:14:11.920 But a cool, that's uh, that's money. You I'm sensing something. 0:14:11.920 --> 0:14:14.400 Are you cool with this one? Or you like the 0:14:14.400 --> 0:14:17.360 barter system? No, it's fine. Which would you prefer money 0:14:17.440 --> 0:14:21.520 or barter? Uh? Well, I mean as a nine year old, 0:14:21.520 --> 0:14:23.720 I thought bartering was kind of neat, and I still 0:14:23.760 --> 0:14:27.360 like the concept of trading, like the musical instruments section 0:14:27.400 --> 0:14:31.160 on Craigslist is is lousy with dudes like I'll trade 0:14:31.200 --> 0:14:33.920 my list Paul for your Martin acoustic. Right, so you've 0:14:34.080 --> 0:14:38.920 you've hit upon a the modern revival of bartering. It's 0:14:38.920 --> 0:14:41.720 all over the place. Actually, yeah, I think Craigslist has 0:14:42.120 --> 0:14:47.200 an entire section for each city dedicated to bartering, specifically 0:14:47.280 --> 0:14:51.720 right sub sections in the I don't know this, you know, 0:14:52.360 --> 0:14:55.240 I think Craigslist does have a section. But on like 0:14:55.320 --> 0:14:58.360 the music Instruments board, there's people trading just because that's 0:14:58.360 --> 0:15:01.760 where they seek trades. But um, there's whole sites dedicated 0:15:01.840 --> 0:15:06.400 just to bartering and bartering services. That's got to be included. Yeah, 0:15:06.520 --> 0:15:10.680 Emily actually does that. I didn't know that. Yeah, she'll trade. Uh, 0:15:10.880 --> 0:15:13.880 she's been getting her hair done in exchange for soap. 0:15:14.960 --> 0:15:17.640 And actually the craft scene, the indycraft scene, this like 0:15:17.800 --> 0:15:20.520 that's all they do is trade, Like you know, I'll 0:15:20.520 --> 0:15:23.400 give you this kid's jumper for a bottle of lotion 0:15:24.000 --> 0:15:26.920 and this is uh, you know, bartering is pretty old, 0:15:26.960 --> 0:15:30.120 but a resurgence and bartering isn't new. Um. There was 0:15:30.160 --> 0:15:33.560 actually an explosion in the late seventies of barter clubs. 0:15:34.120 --> 0:15:37.360 Not to be confused with racquetball clubs or swingers clubs, 0:15:37.360 --> 0:15:40.200 which were both also huge in the late seventies. These 0:15:40.200 --> 0:15:42.840 were barter clubs really. Yeah, they were around for a 0:15:42.920 --> 0:15:46.840 little while so people meet and swap things. Um, I 0:15:46.880 --> 0:15:51.080 think it was mail order. Oh yeah, okay, but when 0:15:51.080 --> 0:15:53.880 you take a look at these clubs then and today, 0:15:54.200 --> 0:15:57.960 what you described Emily doing is is pure bartering. Um. 0:15:58.080 --> 0:16:00.800 But you know one of the big limitations of bartering, well, 0:16:00.800 --> 0:16:04.760 two of the big limitations are geographic boundaries, right, which 0:16:04.960 --> 0:16:07.920 which the Internet overcomes because you know, some guy in 0:16:07.960 --> 0:16:10.680 Tacoma has something you need is willing to ship it, 0:16:10.800 --> 0:16:14.080 and you have something he needs. Geographic boundaries gone, right, 0:16:15.280 --> 0:16:18.720 But the timing thing is still a problem. So what 0:16:19.000 --> 0:16:22.960 barter clubs and barter websites have come up with is, um, 0:16:23.000 --> 0:16:26.880 if if the person doesn't have anything to give you, right, 0:16:26.920 --> 0:16:30.080 then they can trade you in credits. Yeah. I didn't 0:16:30.080 --> 0:16:33.360 know that was going on. That's kind of cool. That's money, 0:16:34.040 --> 0:16:36.680 Uh yeah, in a way. No, that's currency. That's it. 0:16:36.840 --> 0:16:39.000 Think about a dollar bill. It's a it's a credit, 0:16:39.040 --> 0:16:42.400 it's a promissory note. It doesn't hold any inherent value. Yeah, 0:16:42.400 --> 0:16:45.280 but only within that network is a currency. Like it's 0:16:45.280 --> 0:16:47.440 not like you can take those credits out to McDonald 0:16:47.600 --> 0:16:51.680 still say, no, totally, you can't, but it's still currency. Yeah, right, 0:16:51.720 --> 0:16:54.440 So like within that barter network. It's still they're still 0:16:54.560 --> 0:16:58.040 using currency. It's just so difficult to get past, you know, 0:16:58.120 --> 0:17:01.760 the necessity for currency. That's a good point. Yeah, it's 0:17:01.800 --> 0:17:06.160 a big shamnon. You were talking about the craft scene 0:17:06.200 --> 0:17:09.680 being like huge and bartering, right, they love it. Marketing 0:17:09.760 --> 0:17:12.560 is as well, like business barters, way more than I 0:17:12.600 --> 0:17:15.200 ever realized. Yeah, I have a stat for you if 0:17:15.240 --> 0:17:19.680 I may. Yeah. Yeah. In two thousand and eight, North 0:17:19.720 --> 0:17:24.200 American companies, not even internationally, but North American companies bartered 0:17:24.320 --> 0:17:28.800 twelve billion dollars in goods and services. Yeah, and apparently 0:17:28.840 --> 0:17:31.600 that was partially a result of the recession, because in 0:17:31.640 --> 0:17:34.439 two thousand one they did like seven point seven five billion. 0:17:34.880 --> 0:17:39.360 But still it's a substantial amount of stuff that was traded, 0:17:40.160 --> 0:17:42.440 either in the form of goods or services. Right, people 0:17:42.480 --> 0:17:46.520 striking a deal like Chicos bail bonds will sponsor your 0:17:46.560 --> 0:17:49.560 baseball team and they'll pay for your jerseys if you 0:17:49.600 --> 0:17:53.240 put Chicos bail bonds on the back. Yes, you will eventually. 0:17:53.280 --> 0:17:55.080 In the case of the yankees't you remember who their 0:17:55.119 --> 0:18:00.040 sponsor was? In bad Newspayers Denny's. Was it really? I 0:18:00.080 --> 0:18:02.240 just saw the other day and I'm like, huh Denny's. 0:18:02.400 --> 0:18:04.399 They were a high profile team. Oh well, they got 0:18:04.440 --> 0:18:08.359 a high profile sponsor. UM. We were talking about the recession, 0:18:09.080 --> 0:18:12.520 UM accounting for an increase among businesses. One of the 0:18:12.560 --> 0:18:15.760 great things about bartering is you it says you're cash 0:18:15.800 --> 0:18:18.280 to pay down debt or to keep workers on the 0:18:18.320 --> 0:18:21.280 payroll or the cash is always good for business. Yeah, Um, 0:18:21.359 --> 0:18:24.080 So that's why corporations do it. People do it in 0:18:24.119 --> 0:18:26.760 times of crisis, which was the case. Well, it's part 0:18:26.800 --> 0:18:29.359 of the case right now. There's been a huge resurgence 0:18:29.400 --> 0:18:33.680 in UM consumer bartering, right because of the economy. Yeah, 0:18:33.720 --> 0:18:37.880 but UM in Argentina and I think two two thou nine, 0:18:38.119 --> 0:18:42.280 their economy was really in shambles and they were bartering 0:18:42.280 --> 0:18:46.520 clubs everywhere. Well. Yeah, in in places where there's natural disasters, 0:18:46.800 --> 0:18:48.400 a lot of times, the first thing they will turn 0:18:48.480 --> 0:18:51.200 to was bartering, at least in a in a temporary 0:18:51.240 --> 0:18:54.879 sense until they can kind of get things restored, because 0:18:55.000 --> 0:18:57.160 I don't know the end of the world. What's what's 0:18:57.280 --> 0:18:59.080 that dollar bill going to do for you? You know? 0:18:59.200 --> 0:19:04.240 I read almost that same phrase on a post collapse 0:19:04.359 --> 0:19:07.680 blog of survival blog and the guy was rambling off 0:19:08.200 --> 0:19:11.520 items that will be good for bartering. Dollar bill is 0:19:11.560 --> 0:19:16.000 not among them, of course not. I R S. Josh. 0:19:16.440 --> 0:19:19.280 Let's let's talk about that, because if you think, hey, 0:19:19.320 --> 0:19:21.760 this is a great way to skirt taxes, I can 0:19:21.800 --> 0:19:25.520 trade my haircut for my homemade soap all day long? 0:19:26.359 --> 0:19:30.280 Am I outing myself? Now? Ask an auditors? Now? Yeah, 0:19:30.280 --> 0:19:33.520 because you know you're supposed to report this stuff. Yeah. Um, 0:19:33.560 --> 0:19:36.679 those barter clubs from the late seventies actually ruined it 0:19:36.720 --> 0:19:42.119 for everybody. Um. Time was you could barter everything and 0:19:42.280 --> 0:19:45.400 not pay a cent of taxes on it. But the 0:19:45.440 --> 0:19:48.960 barter club that the artificial economy created by the barter 0:19:49.119 --> 0:19:53.240 clubs reached about an estimated two hundred million dollars um 0:19:53.240 --> 0:19:55.600 in size, and I R. S went, we want some 0:19:55.680 --> 0:20:00.239 of that. So they reformed the tax code in and 0:20:00.359 --> 0:20:04.760 came up with the ten B form Proceeds from broker 0:20:04.760 --> 0:20:08.000 and barter exchange transactions and if you're bartering, you have 0:20:08.119 --> 0:20:10.440 to both parties have to fill one of these out, 0:20:11.040 --> 0:20:14.439 create like a an estimated market value of the goods 0:20:14.520 --> 0:20:18.280 or services and pay it. Hey, you know when Emily 0:20:18.320 --> 0:20:20.280 first brought that form home filled it out of it? 0:20:20.840 --> 0:20:23.640 What is this you had another form. She said, Yeah, 0:20:23.640 --> 0:20:26.919 you can't trade. You gotta pay the piper. And the 0:20:27.000 --> 0:20:31.840 piper is the I R S. Yeah, it certainly is, Josh, 0:20:31.840 --> 0:20:36.000 but that's not necessarily well that that's a bad thing. 0:20:36.359 --> 0:20:38.240 But the I R S. You can also write stuff 0:20:38.280 --> 0:20:41.800 off that you you have traded. Yeah, so it goes 0:20:41.840 --> 0:20:43.880 the other way a little bit too, And we would 0:20:43.880 --> 0:20:46.800 be remiss to not mention that. Yeah, um, you you 0:20:46.880 --> 0:20:51.240 can right off as an expense something you trade because 0:20:51.240 --> 0:20:54.280 it's value and it's lost and you didn't get any 0:20:54.359 --> 0:20:56.800 money for it, which is how the tax systems set up. 0:20:57.560 --> 0:20:59.760 If you're not getting any money for it, it's different 0:21:00.040 --> 0:21:02.800 and stuff that you're getting money for. Well, and they 0:21:02.800 --> 0:21:04.840 point out that if you get one of those trade credits, 0:21:05.240 --> 0:21:08.840 you could donate that trade credit to a charity and 0:21:08.880 --> 0:21:12.520 write that off if that charity will accept trade credit. Yeah, 0:21:12.560 --> 0:21:14.439 I've never heard these trade credits. I can look into that. 0:21:14.920 --> 0:21:18.639 It's money. I mean, is it a point value they 0:21:18.640 --> 0:21:23.359 assign a wonder. Yeah, there's actually day it's worth this 0:21:23.480 --> 0:21:26.919 many dollars. Well, one that I came across, dib space 0:21:27.359 --> 0:21:32.000 um had something called Dibbitts and their trade credits, and 0:21:32.320 --> 0:21:36.119 there were one dibots worth a dollar, So it's money 0:21:36.160 --> 0:21:40.919 based on money in a bartering network. Well money, Did 0:21:40.960 --> 0:21:43.000 we ever say that money inflation? That's one of the 0:21:43.440 --> 0:21:47.280 downsides of of currency. We didn't say it, but go ahead, 0:21:47.440 --> 0:21:49.000 Well yeah, I mean that's the big deal. Like you 0:21:49.119 --> 0:21:53.240 buy a peck a bushel of peaches one year for 0:21:53.359 --> 0:21:56.240 ten bucks, and the next year that might buy ten peaches. 0:21:56.800 --> 0:21:58.920 That's the downside of money. Although I suppose I could 0:21:58.960 --> 0:22:01.720 happen bartering too. They could just say, rough, peach crop 0:22:01.800 --> 0:22:04.280 this year now, will only trade you this many for 0:22:04.359 --> 0:22:07.280 your core. Yeah. That I would think relative value would 0:22:07.280 --> 0:22:10.160 be affected by supplying demand. Yeah, I mean that makes sense. 0:22:10.200 --> 0:22:15.320 I would think it wouldn't happen on such a widespread level, though. 0:22:15.320 --> 0:22:17.399 I mean, think about how many people are affected by 0:22:17.400 --> 0:22:20.600 the dollar bill and its fluctuations, right, Think about how 0:22:20.600 --> 0:22:23.840 many people are affected by a local peach crop. And 0:22:23.880 --> 0:22:26.400 that's actually one of the things that barter systems are 0:22:26.600 --> 0:22:29.359 um so appealing to people these days. There's such a 0:22:29.400 --> 0:22:33.640 movement towards local economies. Barter system can't be sustained by 0:22:33.680 --> 0:22:38.520 a country of three million people, so basically everybody has 0:22:38.560 --> 0:22:41.680 to split up. I read an essay about how um 0:22:41.800 --> 0:22:44.440 secessionism could save the US and that if we don't 0:22:44.480 --> 0:22:48.080 break up, we're in big trouble. Yeah, that any any 0:22:48.160 --> 0:22:53.400