As most of the world continues to attempt to extricate itself from economic recession, some people wonder how secure their savings are. For the past six centuries on the western Micronesian island of Yap, the biggest issues with money have usually involved how to move it without being crushed. After all, coins tend to be a bit unwieldy when they weigh up to four metric tons.
Rai stone on display in the lobby of the Bank of Canada building, Ottawa. Source: Beades, http://commons.wikimedia.org/wiki/File:Rai_stone_from_Yap_currency.jpg. Licensed under the Creative Commons Attribution-Share Alike 3.0 Unported licence.
Called rai stones, these giant limestone bagels hold value because of their composition: they are carved from limestone, which does not occur naturally in Yap. The value of the rai comes not just from its size or from the quality of the cut but from its history (e.g. extrinsic value generated by previous owners or transporters, or the amount of people who died transporting the stone). Legend has it that about 500 to 600 years ago, a Yapese sailor/warrior named Anagumang landed 450 kilometres away in Palau and was awestruck by the amount of limestone. He initiated a trading arrangement by which the Yapese could quarry Palauan limestone in exchange for items such as beads and copra. For ease of transport, Anagumang ordered his men to quarry the stones in a circular shape (the holes were added so that labourers would have an easier time carrying the stones).
As each rai was a rare and coveted item, they essentially because the main trading currency of Yap. Marriages, land swaps, political alliances, ransom for war dead: all of these could be traded for rai stones. Since the stones were so hard to quarry and transport by hand, the amount produced on a regular basis was low, keeping the value of each stone high. Alas, not even giant donut-shaped limestone rocks that took dozens of men to carry could escape devaluation once Western society discovered the island.
David Dean O’Keefe was an Irish seaman who knew how to work spinning a tale into making a buck. By the 1870s, he was making a fair living in the Pacific copra trade. Yap proved to be an optimal trade station. Whereas other traders had encountered some difficulty in dealing with the traditional ways of the Yapese (i.e. they weren’t impressed by the Western trinkets traders tried to give them for their copra), O’Keefe played into their need to quarry and transport rai stones. He offered his ships and tools to Yapese chiefs for use in quarrying and transporting the stones (the stones, of course, would only be released to the Yapese once O’Keefe was fully paid in copra. Eventually, O’Keefe installed himself as the veritable ‘king’ of the island of Tarang, complete with royal emblem, where he lived in opulence before dying at sea in 1901).
The sudden ability to quarry and transport stones more easily (the Yapese now access to iron tools thanks to O’Keefe) meant that there was a sudden flooding of rai stones into Yap. The value of the stones immediately plummeted (presumably there was no federal reserve chair in Yap during the 1870s to help regulate the Yapese rai). Over time, the colonial battle between Germany, Japan and the United States halted the production of rai, and the US dollar eventually took over as the everyday currency of use. The remaining stones still retain their value to this day, however, and are still used for large transactions. In order not to damage the rai, they remain in their current physical locations displayed along roads and paths around the island even though ownership of the stones may change. The state of Yap recognises the curiosity value of the stones and uses it as a state symbol, even putting it on license plates. Not even the playing cards of New France-era Canada can rival the rai stone as the world’s most unique currency.
Source: E. Guinther, http://en.wikipedia.org/wiki/File:Yap_Stone_Money.jpg. Licensed under the Creative Commons Attribution-Share Alike 3.0 Unported licence.
Atlas Obscura (2008). Rai Stones. Available at http://atlasobscura.com/place/rai-stones. Accessed 1 August 2010.
FSM Visitors Board (n.d.). Land of Stone Money: State of Yap. Available at http://www.visit-fsm.org/yap/. Accessed 1 August 2010.
Hezel, F.X. (1983). The First Taint of Civilization: A History of the Caroline and Marshall Islands. Honolulu: University of Hawaii Press.
Hezel, F.X.(2008). The Man Who Was Reputed to be King: David Dean O’Keefe. Journal of Pacific History 43(2): 239-252. Available at http://www.micsem.org/pubs/articles/historical/frames/O%27Keefefr.htm.
Pine, A. (1984). Hard Assets, or Why a Loan in Yap is Hard to Roll Over. The Wall Street Journal, 29 March 1984: 1.