Europe
7:28 pm
Sat February 11, 2012

Old Money Helps Spanish Village Stay Afloat

Originally published on Sun February 12, 2012 12:09 pm

Villamayor de Santiago, population 2,500, is a small village just south of Madrid, Spain.

It's famous for three Manchego cheese factories and a windmill that stopped turning decades ago. More than one-third of the town is unemployed.

After Christmas, shopkeepers decided to jump-start their economy.

"We realized there's no money here — well, no euros anyway — in the pockets of our customers," says Luis Miguel Campayo, head of the local merchants' association.

So, he floated an idea: Just for a month, do business in pesetas — a currency that hasn't been in use in 10 years. Campayo had a hunch the town's aging population might have some old currency squirreled away.

"People kept their pesetas because of this romantic attachment to the past," he says — and just in case the euro folds.

So 30 shopkeepers signed on to accept pesetas and hauled out their calculators. One of them was José María Caballero, who runs the local drugstore.

"A lot of people are coming in," he says. "Including people with big bills, for 1,000 or even 5,000 pesetas."

That's about $50 — a lot to keep stashed in your closet. Caballero says shopkeepers made the equivalent of about $8,000 in peseta sales in January, so they extended the campaign through February.

"When we finish our promotion later this month," he says, "we'll change the pesetas for euros, then hand out what everyone earned."

Unlike other eurozone countries, which set deadlines for turning in old money, the Bank of Spain in Madrid still accepts pesetas for euros — at the old 2002 rate. It estimates there are more than $2 billion worth of pesetas still out there somewhere — like in 94-year-old María Martinez's pocket.

She says the pesetas fell out of a pocket in an old skirt when she was packing up to move into the nursing home where she lives now.

The nurses there say some of their elderly residents don't realize pesetas disappeared 10 years ago, but Martinez has her wits about her.

Asked if she'll spend those pesetas now, in a shop around the corner, she says no, she'll just keep them as a souvenir.

"Nowadays things are different," she says, fumbling for some euros in her purse.

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Transcript

RACHEL MARTIN, HOST:

The European debt crisis has many worried that countries like Greece or Spain might have to abandon the euro. But reporter Lauren Frayer found a village south of Madrid that's already doing just that, at least for a while.

LAUREN FRAYER, BYLINE: Welcome to Villamayor de Santiago, population about 2,500. It's famous for three manchego cheese factories and a windmill that stopped turning decades ago. More than a third of the town is unemployed. And after Christmas, shopkeepers here decided to jumpstart their economy.

LUIS MIGUEL CAMPAYO: (Spanish spoken)

FRAYER: We realized there's no money here - well, no euros anyway - in the pockets of our customers, says Luis Miguel Campayo, head of the local merchants' association. So, he floated an idea: Just for a month, let's do business in pesetas, which haven't been used in 10 years. Campayo had a hunch that the town's aging population might have some old currency squirreled away.

CAMPAYO: (Spanish spoken)

FRAYER: People kept their pesetas because of this romantic attachment to the past, he says - and just in case the euro folds. So, 30 shopkeepers signed on to accept pesetas and hauled out their calculators. One of them was Jose Maria Caballero, who runs the local drugstore.

(SOUNDBITE OF CHIMES)

FRAYER: A lot of people are coming in, he says, including people with big bills, for a thousand, even 5,000 pesetas. That's about 50 bucks - a lot to keep stashed in your closet. Caballero says shopkeepers made the equivalent of about $8,000 in peseta sales in January, so they extended the campaign through February.

CAMPAYO: (Spanish spoken)

FRAYER: When we finish our promotion later this month, he says, we'll change the pesetas for euros and hand out what everyone earned. Unlike other eurozone countries, which set deadlines for changing in old money, the Bank of Spain up in Madrid still accepts pesetas for euros at the old 2002 exchange rate. And it estimates there are more than $2 billion worth of pesetas still out there somewhere. Like in 94-year-old Maria Martinez's pocket.

MARIA MARTINEZ: (Spanish spoken)

FRAYER: She says some pesetas fell out of a pocket in an old skirt, when she was packing up to move into a nursing home, where she lives now. The nurses say some of their elderly residents don't realize pesetas disappeared 10 years ago. But Martinez has her wits about her. I ask her if she'll spend those pesetas now, in a shop around the corner.

MARTINEZ: (Spanish spoken)

FRAYER: No, no. I'll keep them just as a souvenir, she says. Nowadays, things are different, she reminds me, and fumbles for some euros in her purse. For NPR News, I'm Lauren Frayer in Villamayor de Santiago, Spain. Transcript provided by NPR, Copyright NPR.