Yap is a state of the Federated States of Micronesia that’s part of the Carolina Island Group and also part of Oceania. Complicated? Not compared to their monetary system.
Yap was just some local folks for unknown thousands of years until the the Spanish took charge in the 16th century. Then in 1898, they sold the joint to the Germans who envisioned Yap as a pivotal facility in their Pacific arm of a communication network spanning the globe, years before such a thing was possible. Then the Japanese took over, followed by the Americans, and then the FSM finally gained independence. This, despite the fact that islanders were loaded with money.
One form of currency was the lava-lava, which was cloth made from coconut palm fibers that was used for loin cloths. You better have a good poker hand at the end of the night or you might have to skittle on home bare-nekid. They also monetized Gau, which was a 10-foot shell necklace; these shells were rare, as they were from a distant island. Another kind of money was Reng, which is ground turmeric that’s been formed into a hard ball. So far, typical island antics.
The Spanish never even noticed that the Yapese had evolved an enigmatic, highly complex monetary system because the BIG money, called rai or fei, was made of stone—and the Spanish thought they were just yard ornaments. Some of this capital was in the form of small coins like silver dollars, but some coins were up to 12 feet across, a foot thick, and weighing four and half tons. Very unlike like the old $100,000 U.S. bill.
The stone used to make this money wasn’t from Yap and it was a tough get. The Yapese had to sail to Palau 250 mils away, smooth-talk their neighbors out of the stone, sit there and carve the money using stone and shell tools—all the while pretending it was no biggie, just a fun dining room table. But the neighbors were no dummies and began to tax the stone. This led inevitably to inflation.
Once the stones were carved, the Yapese build rafts and floated the money home-to-papa, cuz ‘baby needs a new paira shoes.’ The value of a given coin was determined by its luster, size, age, who used to own it, and how many islanders lost their lives in the getting (which was generally a good number).
Then in the 1871, a typhoon spit a shipwrecked American onto the beach. This enterprising fellow saw a good opportunity after landing on Yap. By using modern tools, he began to fabricate stone coins and flood the market. Counterfeit? Maybe. But it was the Japese who did the work and everyone knew who made the money, so it did have some value. O’Keefe became a rich trader in the region, as he bought copra (dried coconut used for oil) with the coins he manufactured.
David O’Keefe has his own amazing story. Despite the fact he made the currency wobble, he brought wondrous things to Yap, provided employment and was fair in his dealings. He built an imposing New England style house on an island in the middle of the lagoon, complete with a substantial library. The Yapese declared him to be their ‘king.’ This was really an expedient to unify the many factions on the island. Unlike some ‘island kings’, O’Keefe and the islanders weren’t entirely serious about him being a real king as his position was essentially economic and he was widely admired. He entertained the islanders in his home as equals, even marrying a couple of the local women to add to his collection of wives in other places. Marlon Brando took a page from this book, or movie, as there is the rather good Burt Lancaster film: His Majesty O’Keefe (1954). The movie trailer gets Yap entangled with the 2,800 mile distant Fiji, where they actually filmed the movie.
The O’Keefe bubble burst in 1901 when his ship was lost with him in it and things returned to normal with the original money—the only currency considered to have much value.
The ownership of the coins is recorded through oral history. Everyone knows where the 6,000-some stone coins are and who owns them and why. They do relocate the small change, but most of the coins are too big to move so they stay put—even when the money changes hands.
One very large stone was lost at sea over 150 years ago when it was being transported, though it still retains full value because the ownership is still being tracked. Some rai are collectively owned as shares in this distributed system, which is based on trust and memory. Humm, blockchain, but with real blocks.
Although they use the US dollar for everyday exchanges, the stone money is still carefully valued depending on the status of the previous owners as well as its age and the size. Because tourists like to take pictures of the larger O’Keefe coins, they are steadily increasing in value.
The Yapese have also evolved an elaborate caste system, and it is so definitive that it has been said that you could gather all the islanders in a long line and they could sort themselves into their respective social rank in just a few minutes.
That would be a perfect time to grab some of those coins. O’Keefe has nothing on me.