Coins and Notes of the Month - July 2013

Art and money at the Venice Biennale

The links between art and money are multiple, sometimes obvious, sometimes more subtle. In this year's Biennale of contemporary art in Venice, the artists' interest in the exploration of contemporary social problems in times of financial crisis led them to engage in tales about currencies. The search for alternative points of view on money produced a circular process with several national pavilions examining other nations' unconventional money but typically not their own. This is an interesting process for a monetary historian because it highlights the loss of legitimacy of the traditional state monopoly of monetary issue after six years of economic and financial crisis in Europe, both at the popular level and with artistic elites.

The Greek pavilion exhibited British alternative currencies to official money, the British pavilion built a narrative on Russian plutocrats' accumulation of wealth through the appropriation of firms in the post-Soviet Union privatization process, while the Russian pavilion reinterpreted the Greek myth of Danae, showering with gold coins all female visitors.

The Greek choice to review all sorts of money was not surprising, given the unhappy experience with the Euro, overindebtedness, and harsh austerity imposed by foreign lenders. The dissatisfaction with the social results of money managed by governments and banks led the Greek artist Stefanos Tsivopoulos to search for new approaches. In addition to artistic videos, he reviewed traditional alternative currencies, from Robert Owen's fair exchange notes in hours of work, (already discussed in the November 2012 note of the month on this website) to shell money or eighteenth-century British tokens. He also addressed some of the most recent experiments, including the Lewes pound (illustrated here), a local parallel currency with a temporary value, meant to revitalise local producers, reduce transportation and the carbon footprint, and protected from the fluctuations of the financial cycle.

The Bitcoin was also described, a peer to peer electronic cash system based on an open source cryptographic protocol, not managed by a central authority and conceived in opposition to national governments. The bitcoin has been discussed widely in recent months after a boom in transactions and a bubble effect on its price followed the Cyprus crisis (when bank accounts were forcibly blocked to pay for part of the bailout) and new users were attracted by the anonymous and untrackable nature of this alternative private electronic money.

The British pavilion, conceived by Jeremy Deller, recalled the hard game played by oligarchs in capturing large sectors of the Russian economy during the transition to a market economy, using a variety of forms of private subsidiary money, such as goods tokens, share certificates, workers' paper tokens and stock certificates. It included the Ponzi scheme developed in the 1990's by Sergei Mavrodi with his MMM firm. It was a pyramid scheme issuing certificates (illustrated in this picture) and promising investors extremely high returns, initially paid using the contributions of new subscribers. Mavrodi was later sentenced and jailed for tax evasion and fraud, but while conducting a campaign accusing the government of having caused his financial difficulties he was elected to the Duma. He is still actively promoting schemes in India and elsewhere around the world.

The conceptual Russian artist Vadim Zakharov turned to Greek mythology to stigmatise "Rudeness, Lust, Narcissism, Demagoguery, Falsehood, Banality and… Greed." Interpreting the golden shower through which Zeus made Danae pregnant as a shower of gold coins (not a novelty, given that Titian and Klimt among others had already depicted it), the artist had "One Danae" coins minted for the performance, mocking the traditional State guarantee of value through the caption "the artist guarantees the value with his honor".

Alternative forms of money oscillate between the idealistic utopia and pure scams, but regardless of the true motives of their inventors, they expose their users at some point to total or partial losses on their holdings of the special currency, just as was the case in previous centuries with private banknotes.