New Bank of Canada Museum and the Yap stone as a stone currency…

On 20th July 2017,  Bank of Canada announced reopening of its museum on the 150th Canada day. The museum opened on the day amidst celebrations.

Though, what caught my eye was this post on yap stone.  This is a stone currency used by Micronesians. 

Yap is known for its stone money, known as Rai, or Fei,: large doughnut-shaped, carved disks of (usually) calcite, up to 4 m (12 ft) in diameter (most are much smaller). The smallest can be as little as 3.5 centimetres (1.4 in) in diameter.[12] Many of them were brought from other islands, as far as New Guinea, but most came in ancient times from Palau. Their value is based on both the stone’s size and its history. Historically the Yapese valued the disks because the material looks like quartz, and these were the shiniest objects available. Eventually the stones became legal tender and were even mandatory in some payments.[13]

The value of the stones was kept high due to the difficulty and hazards involved in obtaining them. To quarry the stones, Yapese adventurers had to sail to distant islands and deal with local inhabitants who were sometimes hostile. Once quarried, the disks had to be transported back to Yap on rafts towed behind sail-driven canoes. The scarcity of the disks, and the effort and peril required to get them, made them valuable to the Yapese.

In 1874, an enterprising Irish American sea captain named David O’Keefe hit upon the idea of employing the Yapese to import more “money” in the form of shiploads of large stones, also from Palau. O’Keefe then traded these stones with the Yapese for other commodities such as sea cucumbers and copra. The 1954 movie His Majesty O’Keefe cast Burt Lancaster in the captain’s role.[14]Although some of the O’Keefe stones are larger than the canoe-transported stones, they are less valuable than the earlier stones due to the comparative ease with which they were obtained.

As no more disks are being produced or imported, this money supply is fixed.[15] The islanders know who owns which piece but do not necessarily move them when ownership changes. Their size and weight (the largest ones require 20 adult men to carry) make them very difficult to move around. Although today the United States dollar is the currency used for everyday transactions in Yap, the stone disks are still used for more traditional or ceremonial exchange. The stone disks may change ownership during marriages, transfers of land title, or as compensation for damages suffered by an aggrieved party.

This is pretty much the essence of monetary economics as well. Keep supply of money limited to keep money valuable. And we build all kinds of models to prove something as basic as this.

Apparently Bank of Canada had one of these Yap stones which was till now placed in Central Bank office. Now it is moving to the BoC museum:

Until 2013, a large stone ring stood amongst the tropical foliage in the Garden Court of the Bank of Canada’s head office. It wasn’t a sculpture—it was a Yap stone, giant stone money from the island of Yap in the Federated States of Micronesia. Our Yap stone has been with the Bank for 38 years, longer than all but a handful of employees—12 at last count. I had been at the Currency Museum for barely three months myself before a flatbed truck, a huge crane and a dozen men in helmets and safety vests took the Yap stone away. For us, its removal from the Garden Court dramatically marked the Currency Museum’s closing. The big stone’s return now performs the opposite role for the new Bank of Canada Museum—heralding its opening.

stone ring on a stand

For nearly 40 years, our Yap stone stood in the Garden Court of the Bank’s Ottawa head office complex.

stone ring suspended by a crane

The stone is poised above the truck that would take it to Gatineau for its four-year sleep.

For those of you unfamiliar with our Yap stone, or for that matter, any Yap stone, below is the artifact’s exhibition label as it appears in the Museum.

This impressive stone disc is actually money from the Pacific island of Yap. “Rai,” as these stones are called, range from a few centimetres high to four metres high. This is the largest-known rai outside of Yap. It likely stood upright in the ground outside its first owner’s house. When traded, a rai did not move—it simply changed ownership. Raiwere quarried on the island of Palau and taken to Yap on rafts, crossing 500 kilometres of open water. The difficulties of this journey contributed to the rai’s value. Although rai are still occasionally used for culturally significant exchanges, the official currency of Yap is now the US dollar—a somewhat more portable currency.

The Museum’s Yap stone is one of the few rai that actually did move (several times, as it happens) and on 3 June 2017, made what we hope will be its last journey for a very long time. It came home to the Bank.




2 Responses to “New Bank of Canada Museum and the Yap stone as a stone currency…”

  1. derricodenise Says:

    Fascinating. Thank you

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