From a Paper Clip to a House: Bartering on the Web

Kyle MacDonald, 27, traded a red paper clip on the Internet for a fish-shaped pen. He kept trading for something better and eventually got a house.

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On Mondays we focus on technology, and today, the ultimate Internet barter.

Kyle MacDonald, threw a huge party over the weekend. He was moving into his new house in Kipling, Saskatchewan. He didn't pay for the house, he traded for it. He started with one red paperclip and traded that for a pen. He offered to trade that for something else, and more than a dozen trades later, MacDonald reached his goal of a house.

The story of his amazing trades has captured the imagination of a lot of different media outlets, which is part of the story now told by NPR's Adam Davidson.

ADAM DAVIDSON reporting:

Kyle MacDonald says the best way to get his story is to go to his website.

Mr. KYLE MACDONALD (Saskatchewan): I will open a new window...

It's easy to find. Just search for one red paperclip. It started just over a year ago. MacDonald was sitting at his computer in his Montreal apartment. He was thinking about a game he'd played as a kid, where you trade things with your friends, competing for bigger and better loot.

He decided he wanted to trade up to something big from something small. He looked down at his desk and saw a red paperclip.

Mr. MACDONALD: That's the actual picture of the paperclip, um, sitting on my desk. And I decided I was going to try and trade that paperclip for a house.

DAVIDSON: He put a post on Craigslist. Two days later, two young women in Vancouver called him and said they'd trade a pen shaped like a fish for his clip. He traded the fish pen for a handmade doorknob, and that for an old camping stove, the stove for a generator. Within a few months, he graduated from basement junk to some surprising and hard to value items.

Mr. MACDONALD: Ah, this was an afternoon with Alice Cooper, the rocker. I traded that for a KISS snow globe, which I traded for, with Corbin Bernsen, a Hollywood actor guy, who collects snow globes, knows all about it.

DAVDISON: Corbin Bernsen so wanted to add the KISS snow globe to his collection that he traded a speaking role in a movie he's about to direct.

The tiny Canadian Rockies town of Kipling, Saskatchewan, took the right to cast that movie role, and in turn gave Kyle MacDonald the keys to a brand new, three-bedroom at 503 Main Street. So in one year, he started with that one red paperclip...

Mr. MACDONALD: And then now I've, we own a house.

Unidentified Woman: Let's get some makeup on your pretty little face.

Mr. MACDONALD: Sure.

DAVIDSON: MacDonald has become a media sensation. This day, he's in New York City to appear on New Morning, the Hallmark Channel's breakfast time show.

Mr. MACDONALD: At the hotel that I stayed at they didn't have soap. They had skin cleaner.

Unidentified Woman: Ooh! See? Well, now you're moisturized, so that's good.

DAVIDSON: Before the red paperclip project started, MacDonald had a part-time job selling a special kind of shim that keeps bar tables from wobbling. Now he's constantly being flown around the world for media appearances.

Mr. MACDONALD: It's been crazy. Like, I, my phone number and e-mail on the website, it's been ringing for the last seven months straight. My girlfriend and I got flown over by Fuji TV from Japan. The phone will ring in the middle of the night and it'll be someone from Australia or England that's, can you go live to air right now to do an interview? And I'm like, yeah, yeah, sure. No problem. And they're like, good, because you're already on. So...

DAVIDSON: He's been in countless newspaper articles and radio shows. He's been on Good Morning America three times, CNN has covered many of his developments, 20/20 did a big profile. Caroline Sprinkle(ph), a producer at New Morning, and MacDonald discuss why his story is just perfect for television news shows.

Ms. CAROLINE SPRINKLE (Producer, Television Show, New Morning, in New York): It's just such an incredible story, though.

Mr. MACDONALD: Yeah. Yeah. It's pretty simple.

Ms. SPRINKLE: A guy trades red paperclip for house.

Mr. MACDONALD: And then everyone was like, what? And then they were all...

Ms. SPRINKLE: Film at eight.

Mr. MACDONALD: ...they all want to hear about it. Yeah.

Ms. SPRINKLE: Right.

Mr. MACDONALD: Coming up after the break...

Ms. SPRINKLE: Right!

Mr. MACDONALD: Watch these commercials.

Ms. SPRINKLE: Right.

DAVIDSON: Just about every time MacDonald is featured on a show, the same word comes up: inspiring. 20/20 talked about how MacDonald has been able to grant wishes. Twice CNN aired its own original poem celebrating MacDonald's ability to touch lives.

Sprinkle, the New Morning producer, says there's something about MacDonald's project that reaches beyond the mundane - into the spiritual.

Ms. SPRINKLE: The big question, the philosophical question, which is what's your red paperclip. What's going to be that first step to take you towards your goal, your dream. Yeah. There's an inspiration - it's inspiring. It's just a great inspiring, funny, wonderful story.

DAVIDSON: Some shows say MacDonald teaches us to pursue our dreams. Others say he teaches the value of hard work, or the importance of starting small, even to achieve greatness, or the enrichment that comes from human interconnectedness. Almost no one talks about Kyle MacDonald's obvious talent for promoting himself.

But that is what most intrigues Tyler Cowen, an economics professor at George Mason University.

Professor TYLER COWEN (Economics, George Mason University): I think the main lesson is how much today someone with a clever idea and no assets, except a paperclip, how far they can get. And that's because of the Internet. That they will be found and they will be publicized, and they can do something with that.

So the lesson is the ability of smart, clever people to do more than they used to be able to do.

DAVIDSON: Cowen has written about MacDonald and the paperclip on his blog, Marginal Revolution. He points out that the house MacDonald got was not exactly free. Many of the people who he made trades with were clearly valuing the media attention more highly than whatever physical thing they were trading, and MacDonald worked very hard, more than full-time, for more than a year.

Prof. COWEN: So it really required quite a lot on his part, even though it just seems like he was trading a paperclip up to a house.

DAVIDSON: In fact, the weirdest thing about the story is that MacDonald might have gotten way too little for his red paperclip. He came up with this great idea that got the kind of attention companies would pay millions of dollars for, and the house he got, judging by the real estate market in Kipling, Saskatchewan, is worth around $50,000, Canadian.

Although to be fair, that's not all he got. MacDonald recently signed a book contract and a movie deal. And the town of Kipling? It's building the world's largest red paperclip, which, it hopes, will draw lots of tourists.

Adam Davidson, NPR News.

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