The Worse the Economy, the Better the Barter

When you can’t pay with cash

A few weeks ago, I was trying to find a way to take a short vacation I’d planned more than a year before. The problem was that I’d been unemployed for most of that year and had just started back to work. I was scratching the bottom of the barrel, financially.

I could get time off from work without pay, but that would take such a bite out of my next paycheck that I wouldn’t be able to pay a pet sitter to take care of my elderly dog. I considered getting a payday loan, but I knew that borrowing would only make the situation worse and I didn’t want to end up in need of credit repair or a debt relief program.

Ask a friend for a favor

I was lamenting this state of affairs to a friend I had worked with at the company where I had been laid off. My friend was in no better financial shape that I was, but she immediately offered to take care of my dog so that I could take my vacation. Read With a Little Help from Our Friends.

And be ready to offer something in return

My friend wouldn’t let me pay her, but she told me I could help her move to her new condominium about a month down the road. A bargain was struck, and pretty soon it snowballed. I was trading services with friends and neighbors and we were all getting deals we couldn’t afford to buy with cash.

Bartering is the new universal currency

Some time later, I came across an article in the Moscow Times that let me know I wasn’t alone in my new bartering lifestyle. Apparently it’s boom time for the barter system in Russia, too. Russian companies are short of cash because of the network of nonpayment brought on by the global financial crisis. As a result, special websites have sprung up to facilitate bartering deals.

Milk for a bulldozer in Russia

For instance, a dairy in Russia paid for renovations by giving a construction company several tons of canned condensed milk; the construction company then traded the milk for a bulldozer from a tractor plant. The tractor company, in turn, traded the milk for other food to stock its company cafeteria.

So far, barter makes up just two percent of the overall Russian economy; still, it amounts to billions of rubles. And the barter industry is practically the only sector of the Russian economy that’s actively hiring.

The Russian bartering company Rusbarter is recruiting potential franchisers, encouraging them to set up regional barter offices with promises of profits after just one month. “The worse the situation is in the economy,” said Anatoly Abadzhan, head of Rusbarter, “the better it is for us.”

Bartering is like money in the bank

I had nothing to lose from the economic crisis except my job. So for me, the financial downturn kind of leveled the playing field. I’ve never had much financial flex, but now, just about everyone I know is pressed financially and willing to barter.

Next time you find yourself daydreaming about low interest loans or looking at junk emails that violate approved patterns of speaking or writing (“payday loans no faxing,” “money loans,” and “mycashnow” are some of my favorites), remember: the worse the situation in your bank account, the better bartering is for you.