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What is money anyways?
| March 3rd, 2017 at 5:26:12 PM permalink | |
| Nareed Member since: Oct 24, 2012 Threads: 346 Posts: 12545 |
Maybe when the minimum wage hits like $10,000 an hour and one dollar is worth what a lira used to, they'll consider replacing the paper note with a polymer one (*) (*) Just kidding. Of course they won't consider any such thing. Donald Trump is a one-term LOSER |
| March 3rd, 2017 at 8:12:52 PM permalink | |
| Pacomartin Member since: Oct 24, 2012 Threads: 1068 Posts: 12569 | I think more and more countries will try and emulate South Korea (possibly even Mexico). South Korea has declared that all coins will no longer be legal tender as of 2020. I think a natural consequence will be that the use of the smallest banknote will also diminish radically. Almost all cash transactions will consist of two denominations only. Circulation per capita in number of notes or coins (31 December 2015) BANKNOTES 25.4 KRW 50,000 34.0 KRW 10,000 ---- US$8.68 5.2 KRW 5,000 29.4 KRW 1,000 COINS 45 KRW 500 185 KRW 100 41 KRW 50 165 KRW 10 South Korean Won↔Mexican Peso 1 MXN = 59 KRW |
| March 3rd, 2017 at 8:37:03 PM permalink | |
| petroglyph Member since: Aug 3, 2014 Threads: 25 Posts: 6227 | https://aeon.co/essays/if-plastic-replaces-cash-much-that-is-good-will-be-lost It is about control The last official act of any government is to loot the treasury. GW |
| March 3rd, 2017 at 10:07:49 PM permalink | |
| Pacomartin Member since: Oct 24, 2012 Threads: 1068 Posts: 12569 |
Which is why the South Korean experiment is unique. Most people who write about eliminating cash want to start with the highest denomination banknotes. The world governments have more or less agreed that the really big bills, the US$500,$1000, $5000, $100000, the Canadian $1000, the Swedish 10,000-kronor, the SGD$10,000 and the 500 Euro note are all on or headed for the chopping block. But more and more aim is being taken at the mid level bills like the British 50 pound note. South Korea simply notes that the greatest efficiency will occur if there is no legal coins. But even in a pinch you would only lose a maximum of US 86 cents if you didn't want to pay electronically and simply passed on taking your change. But the bigger bills are no immediately affected. It may well turn out that they are simply laying the framework for abolishing all cash, and just starting with the coins as an easy way to force every single person to adopt an electronic payment system. But Sweden is considering adopting a digital currency that has no credit risk like commercial bank money. In many ways it would be similar to banknotes. But the soda machine in the article still might not work. |
| March 4th, 2017 at 12:05:29 AM permalink | |
| petroglyph Member since: Aug 3, 2014 Threads: 25 Posts: 6227 | How about inflation protected? The last official act of any government is to loot the treasury. GW |
| March 4th, 2017 at 5:47:42 AM permalink | |
| AZDuffman Member since: Oct 24, 2012 Threads: 135 Posts: 18204 |
Absolutely. Eventually you could freeze a person out of the system. Or the courts could let their creditors take every last cent from their "wallet" not even leaving enough for food. The next generation will embrace it. The President is a fink. |
| March 4th, 2017 at 8:22:04 AM permalink | |
| Pacomartin Member since: Oct 24, 2012 Threads: 1068 Posts: 12569 |
It's an interesting question. It is one of the questions that Sweden is wrestling with in their discussion of a digital currency (the e-krona). They seem unsure if the interest rate should be zero, positive or negative. No commercial bank in the world has actually advertises a "negative interest rate". Usually the loss of a customer's money is a result of fees. A few central banks (like Sweden) charge negative interest rates to commercial banks, but that practice only began in the last five years.
I put the rate of growth of cash for 2011-2015 in different countries in a wikipedia page https://en.wikipedia.org/wiki/Cashless_society#Amount_of_cash_in_circulation Avg. year Country 12.1% Turkey 11.9% Korea 8.0% Mexico 7.9% India 6.0% Brazil 6.0% Hong Kong SAR 5.5% Singapore 5.4% Saudi Arabia 5.1% United States 4.4% Switzerland 3.8% Russia 3.8% Australia 3.2% Canada 3.2% Japan 3.2% United Kingdom -3.7% South Africa -6.9% Sweden Of course Mexico's increase in cash is in the peso. Relative to the USD it would be a lot less. South Africa is showing overall negative change, but it is also very unstable rocketing up and down from year to year. Only Sweden is steadily losing cash. United States is increasing cash at a rate (5%) which is considerably higher than any population or GDP growth. It has been doing that for nearly a century. |
| March 5th, 2017 at 4:52:48 PM permalink | |
| Fleastiff Member since: Oct 27, 2012 Threads: 62 Posts: 7831 | Although often thought that coins develop as a quick, easy means of barter, it seems that sociologists and historians tell us that unlike in Adam Smith's fanciful world, real world societies do NOT form a barter system based on equalizing value, the barter systems are social barter systems lacking any enforcement: sort of a I'll mow my lawn to protect teh value of your land. It is thought by some that coinage developed to pay soldiers who otherwise could be paid only in conquored females. Sort of a hire soldiers, have them fight a war and bring home slaves to work the fields, then pay the soldiers with coins. So its either society with only social bartering or its societies with wars, conquests and coins. If we have sustained periods of no enslavement, no wars, no need for a medium of exchange... does coinage have to maintain its value? Can coinage find its own value internally within a country's borders? The Chinese invented the paper currency and also invented the practice of running the presses day and night to produce them. In China it is said 'The Emporer is Far Away' but in the modern world all governments are near. So perhaps we should have no need for an electronic currency to have any index to inflation or deflation. |
| March 5th, 2017 at 6:04:14 PM permalink | |
| Pacomartin Member since: Oct 24, 2012 Threads: 1068 Posts: 12569 | Well right now central bank interest rates are very low or negative in Europe and Japan in order to keep money expansionary. Swiss interest rate SNB Switzerland -0.750 % Swedish interest rate Riksbank Sweden -0.500 % European interest rate ECB Europe 0.000 % Japanese interest rate BoJ Japan 0.000 % Danish interest rate Nationalbanken Denmark 0.050 % Czech interest rate CNB Czech Republic 0.050 % Israeli interest rate BOI Israel 0.100 % British interest rate BoE Great Britain 0.250 % Norwegian interest rate Norway 0.500 % Canadian interest rate BOC Canada 0.500 % American interest rate FED United States 0.750 % Norway has pretty much held its currency in circulation steady for the last decade. Additional spending because of GDP growth is covered by electronic means. Population is fairly steady, but increasing very slightly. One would think that would be the norm Instead, every country is furiously increasing their currency supply at a rate much faster than GDP growth. USA is on a 12-14 year doubling cycle. The only exceptions are Sweden and to some extent South Africa (which is more unstable than anything else). |
| March 5th, 2017 at 8:00:59 PM permalink | |
| Fleastiff Member since: Oct 27, 2012 Threads: 62 Posts: 7831 | Politically unstable I would think, ultra high crime rate, private guards and walled enclaves abound... land reform by coercion or murder is, I've heard, common. So I don't think the South African currency would be stable. Life there is too cheap for there to be stability in the economy. I have respect for teh various Scandinavian countries though their problems are slowly climbing regarding crime and cultural identity. Scandinavian Noir literature notwithstanding, I think their fundamental stability is fine but they soon must address crime and border protections. I wonder what Fukishima did to the Japanese economy or what a few eruptions in quick succession might do to Iceland's economy and I hear French agriculture is lacking in diversity, so might become subject to some pest. Wrecking the economy can wreck confidence in the currency. |