License to print money... BitCoin?

As I said earlier, Sweden has dropped the cash in circulation by -35.31% from 2012 to 2016.

But even more remarkable is that banks have dropped their cash by -80.18% over the same period. Commercial banks are holding less than US$20 per capita. Needless to say most of them don't handle cash at the teller windows, not even for deposits. If there is a run on the bank, then the ATM will simply run out of cash.

The dreaded bank run can't happen in Sweden. Future Swede's won't even understand the bank robber costume.



While most Swede's now function with credit cards and phone apps tied to their bank accounts, the government may introduce electronic currency next year.

Quote: AZDuffman

Bitcoin just hit $8,000! I look at this like the internet stock era of the late 1990s. The strong are the ones who will survive, in this case maybe 10 or so will make it. Lots of people are wasting money on the latest alt-coins hoping for a Bitcoin repeat. It will not happen.

While I agree with you about BTC as a store of value, efforts like Sweden to create a spendable electronic currency may push the development of alt coins that are more easily spendable. Instead of wild variations, their value may be tied to a basket of national currencies.

Quote: Pacomartin

If there is a run on the bank, then the ATM will simply run out of cash.
.

How many people even remember an
all cash society in the US. In the 60's
and 70's I paid cash for everything.
I didn't have checks, accounts cost
money and were a pain. I cashed my
paycheck at the local supermarket
like half of us did, when we checked
out after shopping. There were no
credit cards in grocery stores, I only
saw them in gas stations.

I had checks when I started paying
utilities, but that's just another form
of cash. Now when you write a check
at the local supermarket, they give
the cancelled check to you on the spot,
your bank already deducted the amount
from your account just like a debit card.

Quote: Evenbob

There were no credit cards in grocery stores, I only saw them in gas stations.

I remember that. I was kind of shocked initially by the idea of using a credit card to pay for groceries.

In the 21 months since European Central Bank announced that the €500 banknote would not be included in the new Europa series of banknotes. In that time there has been a 16% drop (49€ billion Euros) in circulation of the €500 banknote. But the smaller denomination banknotes were increased by more than that amount.
Change in value of circulating banknotes (billions of Euros) in 21 months.
-49€ €500
7€ €200
41€ €100
54€ €50
6€ small

Quote: Evenbob

Now when you write a check
at the local supermarket, they give
the cancelled check to you on the spot,
your bank already deducted the amount
from your account just like a debit card.

I was a cashier at a grocery in the late 1980s. I both hated people paying by check and at the same time was amazed how many did it. People were allowed to write for "$20 over" and did all the time. Some people several times a day. 90%+ of checks were written by women. Men rarely paid by check. Women could write a check so fast it was amazing.

I saw the flaw in the system of how they approved checks. A clerk could approve you for up to 5 stores at once, and bounced checks did not show for a few days. If a clerk was crooked they could approve a few cards for 5 stores and quit. Then a person could hit the stores starting on a Friday before a 3 day weekend. Hit each of 5 stores twice on each of the three days so different management and staff was on duty. Bang out $125 or so of cigarettes, razor blades, and other items you could resell. Take the $20 over each time. That is $600 in cash and all the resale value of the items. They would not know until Tuesday or even Wed, when the checks started bouncing. Not a bad score for the 1980s.

Only trusted clerks could approve and make the cards, but there was a pile of them just sitting there that I could have taken a few and never be missed. I forget exactly if they had to be activated or not, but the key was once it was good it did not flag until a check was bad.

This is the kind of scheme a small time wiseguy would love.

Quote: AZDuffman

This is the kind of scheme a small time wiseguy would love.

And many did prison time for it
because they didn't know when to quit.
I actually kited a few checks 30 years
ago. I went to IN weekly to sell at
the auction in Shipshewana. They
paid me with a check drawn on a
local bank. Because it was faster
to just stop at that bank on the way
home, I opened an account there.

So sometimes I would pay for things
in IN with checks from that bank.
Sometimes I would cover the checks
with a deposit from my home bank.
A few times there would be not enough
money in my home bank, but I knew
that by the time it cleared I would
have made a cash deposit.

This went on all summer until my bank
manager called me into her office
and explained that IF that's what I was
doing, it was against Fed law. I stopped
right then, I really had no idea. Seemed
like a good system to me, all those
checks floating around waiting to land.

Quote: Pacomartin

I remember that. I was kind of shocked initially by the idea of using a credit card to pay for groceries.

That's funny, I remember the same thing.
Credit was only used for serious things,
like buying a snow blower or a boat.
When I saw a guy charging a carton of
smokes, I was appalled. I thought he was
desperate and out of cash. lol

I remember the first time I saw a credit
card used at the pump. I thought the
guy was driving away without paying,
I had never seen anybody pay without
going inside to do it.

Quote: Evenbob

And many did prison time for it
because they didn't know when to quit.

I'm sure they did, and this would send you to the can, at least county jail. But I say a wiseguy would love it because it would be a perfect scam. It would take a local wiseguy to work it to efficiency since it would require an inside man at both the grocery store and bank. Plus 4-5 runners working all weekend. A beginner could not pull this all off.

I'm a rare type. I like to think how a scam could be pulled off, even if I never do it.

Quote:

This went on all summer until my bank
manager called me into her office
and explained that IF that's what I was
doing, it was against Fed law. I stopped
right then, I really had no idea. Seemed
like a good system to me, all those
checks floating around waiting to land.

IIRC, what you describe is what brought down E.F. Hutton.

Quote: AZDuffman

what you describe is what brought down E.F. Hutton.

I was so ignorant at the time, I
thought I was very original in
thinking it up. Seemed perfectly
logical and hurt nobody. lol

Quote: Evenbob

I was so ignorant at the time, I
thought I was very original in
thinking it up. Seemed perfectly
logical and hurt nobody. lol

It used to be a thing that some companies would have a few banks all over the country, then send checks for payment to correlate with the furthest bank away, or in the hardest place to get to. For example, paying a bill to a vendor in Upstate NY they would use the bank in California, better yet some small bank in Reno. Gave an extra day or two of float and to salami slice interest. This can't work today, but at one time gave days extra.

Quote: AZDuffman

This can't work today, but at one time gave days extra.

I would deposit a check in IN
on Thurs and it would hit my
bank next Tue. Out of state
and a weekend makes a huge
difference.