Sweden Moving Towards Cashless Economy

cold fjord writes "Sweden is rapidly moving towards a cashless economy. How will Sweden, and other countries in the future, balance efficiency, privacy, government control, and civil liberties? Or will they do all that technology allows? 'Bills and coins represent only 3 percent of Sweden's economy, compared to an average of 9 percent in the eurozone and 7 percent in the U.S. ... The Swedish Bankers' Association says the shrinkage of the cash economy is already making an impact in crime statistics. The number of bank robberies in Sweden plunged from 110 in 2008 to 16 in 2011 — the lowest level since it started keeping records 30 years ago. It says robberies of security transports are also down. The prevalence of electronic transactions — and the digital trail they generate — also helps explain why Sweden has less of a problem with graft than countries with a stronger cash culture, such as Italy or Greece, says economics professor Friedrich Schneider of the Johannes Kepler University in Austria. The flip side is the risk of cybercrimes. According to the Swedish National Council for Crime Prevention the number of computerized fraud cases, including skimming, surged to nearly 20,000 in 2011 from 3,304 in 2000.'"

Comments

Scary

[Hatta]

I don't care what sort of up sides it has. The government being able to track every last penny spent is far too frightening to even consider.

Re:Scary

[fuzzyfuzzyfungus]

We understand your concern, citizen.

Here in glorious America, we will naturally let Visa track every last penny spent, because the private sector is superior, and they will simply sell that data to law enforcement, among other interested stakeholders, as part of their process of 'monetizing consumer metrics'. Free as in 'Free Market'!

Re:Scary

[seven of five]

Don't worry... they're moving to Bitcoin.

Re:Scary

[Pieroxy]

I don't care what sort of up sides it has. The government being able to track every last penny spent is far too frightening to even consider.

Add to that the title of the previous story on Slashdot: The Risk of a Meltdown In the Cloud

Well. What could go wrong?

Re:Scary

[mooingyak]

We understand your concern, citizen.

Here in glorious America, we will naturally let Visa track every last penny spent, because the private sector is superior, and they will simply sell that data to law enforcement, among other interested stakeholders, as part of their process of 'monetizing consumer metrics'. Free as in 'Free Market'!

It's not like everyone's oblivious to the fact that when you use Visa your purchases can be tracked. I'm aware of it every single time. But right now I have a choice to use cash if I want some discretion.

Re:Scary

[judoguy]

VISA doesn't track every penny spent. I write credit card billing software. VISA, MC, et al just get a transaction total. Only the vendor knows what was charged. VISA can look at the vendor and make assumptions, however they don't know if I bought a lot of candy bars or gas or what mixture of transactions from a Mobil station.

Re:Scary

[wild_oscar]

I don't care what sort of up sides it has. The government being able to track every last penny spent is far too frightening to even consider.

Why is that any more or any less scary than a private company being able to do exactly the same thing?

Re:Scary

[SpeZek]

You know, it might be a completely alien thought to some (most?) Americans but some countries have citizens / subjects that trust their government to represent and protect their interests.

Re:Scary

[SpeZek]

Yes, because gulags are a real problem in countries like Sweden.

Re:Scary

[MyLongNickName]

Monetary lesson: Our economy is based on goods and services. Money is only a medium for the exchange of those items. What you are suggesting is really going back to a barter system.

Second lesson: The "devaluation" that you speak of is called inflation. Yes, over time an individual dollar is worth less. We also make more of these dollars for our time. This is not some giant conspiracy.

Third lesson: Gold and land do not have a constant value. That is complete lunacy. Like every other good and service its value is relative to other goods and services

Fourth lesson: If you want to use gold as a curency, go for it. It doesn't change the underlying issue that it only stands in for the goods and/or services you wish to buy/sell.

Re:Scary

[vlm]

VISA does not know how many candy bars you bought, retail corporate does. Even back in the very early 90s I know for a fact they did, as I was getting interested in IT and our food store did complete transaction uploads nightly. Its not as much data as you'd think, even at 2400 baud. We had to upload distinct sales data anyway, think about it, otherwise how would automated push-ordering work? There were cube dwellers at corporate who's entire lives revolved around how many hamburger buns were sold the saturday of labor day or whatever.

So you are correct that VISA does not sell transaction detail records, but that doesn't mean they're not sold, it means the detail record comes from the retailer. At least it did 20 years ago.

Re:Scary

[kilfarsnar]

You know, it might be a completely alien thought to some (most?) Americans but some countries have citizens / subjects that trust their government to represent and protect their interests.

Good for them. Really, if their government really does represent their interests, it is good for them. But that does not describe the United States government unless you are quite wealthy or a corporation.

Re:Scary

[gfreeman]

Wait - 20 years ago some corporate bod knew that Mr Smith of 23 Acacia Avenue bought hamburger buns? I think not.

Re:Scary

[s73v3r]

And not real money.

Gold is no more "real money" than anything else. The only value gold has is what people think it's worth, just like regular dollars.

We need to get back to sound money that "connects" to something of constant value, like gold or land.

No, we don't.

Re:Scary

[BlueParrot]

You know, it might be a completely alien thought to some (most?) Americans but some countries have citizens / subjects that trust their government to represent and protect their interests.

I can assure you Sweden is not among them. People here are fairly sceptical to politicians, and one of the massive headaches for our government right now is that people don't like the data-retention laws that EU directives require member states to implement. Basically most people here pretty much just wants government to do its job and not fuck it up. The American crusade-like political rallying you have before every US elections would just not work in Sweden, since such candidates would be perceived as crazy and unelectable. The current right wing government likely got to power precisely because their leader, Fredrik Reinfeldt, has a fairly calm and down to earth image. That doesn't mean we don't have people screaming at the top of their lungs about immigration and whatnot. They just don't get enough votes to define policy.

Re:Scary

[Kjella]

Well, there's the difference between mostly cashless and completely cashless. My salary is paid direct deposit, pretty much all my bills are paid electronically. I don't really care that the government knows I pay rent and insurance and electricity and broadband and groceries and that I purchase clothes and furniture and computer equipment and whatnot. But if I don't want the government to keep track of how much liquor I drink I can pay in cash at the liquor store. I can pay in cash when I'm out partying all night. Cash is for all those transactions which I don't think it's any of the damn government's business to know about.

Every so often people come up with the "now 9x% of all trade happens electronically, we should go cashless" but it's meaningless to measure it by volume. At work some 9x% I'm in the presence of coworkers, that doesn't mean I don't want privacy when I make a bathroom break. Same with all the shit people share on Facebook, even for those that share 9x% of their life there the rest matters. Yeah, it's annoying with the black market that doesn't pay taxes, but then put the effort into tracking those who make a living that way instead of taking everyone's privacy away. I don't know if I follow every detail of every paragraph in the tax code and I don't know if anyone could but it's 95%+ correct. And that damn well better be good enough.

Re:Scary

[zzsmirkzz]

Things cost more over time in dollar terms.

Yes, obviously but that wasn't the question. The question was why? Are the things bought with the dollar intrinsically worth more now? No. So if the value of the object has not changed but it's price in dollars has, then what changed? The value of the dollar obviously. It is now worth less and has been devalued.

Things cost more over time in dollar terms. But guess what. Income goes up in dollar terms as well.

Yes, but not as fast which is why the middle-class is shrinking and merging with the lower-class.

Now go take some economic classes and stop getting your education from conspiracy theory websites.

I suggest you get some information from somewhere other than past bankers. Also, remember what you studies was Economic theory not economic fact.

Re:Scary

[timeOday]

I don't know about "usually." It's like anything, too little is bad, and too much is bad. N. Korea and Somalia both suck hard. So there's no general answer, you just have to look at each issue on its merits.

Re:Scary

[vlm]

Wait - 20 years ago some corporate bod knew that Mr Smith of 23 Acacia Avenue bought hamburger buns? I think not.

Yes. 20 years ago is only 1992, not like the 60s or something. In 1990, 91, something like that our mid size grocery store in a mid size suburb of a mid size city got roughly 386 class machine (was it a 486?) in the managers office and it ran the dbms that read the upc from the scanner and told the register what to charge and its tax status. Also it kept a list of all loyalty cards who owed us money for bounced checks (at one point my job was keeping that list updated). We uploaded nightly at 1030 and woe to the assistant manager who couldn't "close out" before the upload began. Also we downloaded lists of bounced checks/loyalty cards from OTHER stores..

We made a big freaking deal about giving you coupons that reflected your previous purchases. Maybe, like 99% of the population, you just threw that out, but that doesn't mean we didn't print the coupons at the bottom of the register tape. You had a "check cashing/loyalty card", right? To at least some extent your coupons mailed to your door reflected your purchases... the presence or lack of baby formula and dog food tended to reflect your previous purchases... We didn't do individualized personalized coupon mailings, but we did classify them.

Now I donno if they stored all the data, or how long. Now a days you'd assume they keep it all forever. Back then I would assume they wiped whatever they thought appropriate when they needed space. At that time (err, 93 or so) I was using a 40 meg drive and a 386/40 with 5 megs ram to run SLS linux.. Can't store everything forever with that tech.

Didn't you notice that if you bought something with a CC and returned it with a receipt, we credited your card without asking to see it again? We had all that stored.

I suppose it depends on location, blah blah blah, but I was at a unnoteworthy little grocery store most nights while going to tech school in the day.

Re:Scary

[Anonymous Coward]

So Swedes have an expectation that the government should do its job and not fuck up. That is already an immense amount of trust put in the government compared to what you see in the US. Over here you'll see many people who assume that if the government is doing something, then that thing must be done badly just by a law of nature. That they do not vote for crazy/stupid/belligerent people is probably one of the reasons that Swedes get to have expectations like that government should just work.

Re:Scary

[Sponge Bath]

Of course it's more efficient to have corporations track and control you directly. Government is a middle man used to give these practices a veneer of legitimacy. That costs corporations money that could be better spent on executive bonuses, so it's best (for corporations) that the unwashed masses embrace their overlord status without the illusion of a government for the people.

Re:Scary

[guanxi]

That's what the useful idiots always say. I'm sure that Germans in 1920 didn't expect to see mass extermination camps in their country either.

Sweden in 2012 is like Germany in 1920?

I agree, anything is possible, but I'm going to focus on the things that might actually happen.

Re:Scary

[Bill, Shooter of Bul]

If you have a non zero population growth, there is no such thing as a constant value for any thing.

Re:Scary

[Sir_Sri]

It's not. I use cash whenever I can.

As per the article: so do the greeks and italians (and outside the euro zone, indians, arabs, bangladeshi's, pakistani's etc).

Cash sounds like a wonderful privacy tool. It's so wonderful that you can use it to dodge tax. http://www.indianexpress.com/news/goa-education-minister-detained-with-10-mn/770712/ For example.

That's kind of the thrust of the article, cash based societies are more corrupt than electronic ones, because with electronic ones you can actually track where the money is going to and from.

From TFA:

"If people use more cards, they are less involved in shadow economy activities," says Schneider, an expert on underground economies.

In Italy — where cash has been a common means of avoiding value-added tax and hiding profits from the taxman — Prime Minister Mario Monti in December put forward measures to limit cash transactions to payments under euro1,000 ($1,300), down from euro2,500 before.

.
.
.
Oscar Swartz, the founder of Sweden's first Internet provider, Banhof, says a digital economy also raises privacy issues because of the electronic trail of transactions. He supports the idea of phasing out cash, but says other anonymous payment methods need to be introduced instead.

"One should be able to send money and donate money to different organizations without being traced every time," he says."

So fair enough, you think your privacy is being invaded by using electronic payments. But the government thinks you're using cash to dodge legally required taxes. And if you're both right who wins? The only way this is going to play out is asking for privacy rules surrounding the record keeping on transactions, because it's not fair to anyone when people dodge taxes, and if there's a way to track that, governments will (as they should).

Re:Scary

[Aryden]

When I worked for Kroger Food stores in the 90's, we uploaded that data every single night. We had to take any online register off, close their drawers out and then begin the process of batch totaling and upload of the days sales figures as well as a transaction by transaction record. We could pull up any transaction for the day from the register or from prior dates via logging into the central database.

Re:Scary

[JustSomeProgrammer]

How do you define naturally? Is natural due to natural course of advances in technology and civilization? I'm pretty positive oil is worth more now than it was when the dollar was first printed. If the supply of some good decreases due to dwindling resources a source of natural inflation or a new source located a source of deflation? If the amount of people in a population increases, universally creating more demand for every item, is this a natural source of inflation since every good is now able to be sold at a higher price thus resulting in a "weaker" dollar. If this is not the definition of naturally fluctuating prices then I don't think speaking about prices naturally changing is even relevant since it doesn't apply to the real world.

Over time the values of different goods DO change. Buggy Whips aren't the same value as they were back in the day and the value for different resources increases or decreases as we discover new uses or better resources over time or due to increases or decreases in supply or demand.

Re:Scary

[cayenne8]

Why is that any more or any less scary than a private company being able to do exactly the same thing?

Err, I'm not sure how they connect or track me with the cash I use for local purchases.

That's the point...if you use cash, it makes it very difficult for the govt. or private industry to track your expenditures.

Re:Scary

[snowbored]

VISA sure as heck does know. How do you think you get double points for gas, or hotel stays, or whatever? Depending on the card, up to the first 19 items you purchase get sent back to VISA. So if you don't want a record that you bought something, make it your 20th item (and don't buy 20 oranges, I wrote the software smart enough to group the same items). They do only know generic things (you purchased a food item, not that your purchased a specific candy bar), but the generic list is broken down into things like alcohol, tobacco, so they do have information you might not want them to know like that last Friday you bought a six pack and some smokes from the corner gas station.

Re:Scary

[vijayiyer]

Why not just track us all, because it's not fair to anyone when people commit crimes? Once we lose an underlying presumption of innocence, any invasion of our privacy or erosion of personal liberties seems to make sense.
It's not my job to help the government do theirs. They can catch tax cheats with good, old fashioned detective work. To presume that my heavy use of cash is somehow illegal or fraudulent is ridiculous.

Re:Scary

[cpu6502]

>>>Things cost more over time in dollar terms

They didn't cost more in the 1800s when the dollar held its value (pre-federal reserve). Inflation is not a given, and in fact there's no good reason for it to exist. The dollar and prices should hold constant.

BTW who is Ron Apul?

And where does it say in the Constitution that a private bank (the Fed) should be given an exclusive monopoly by the Congress? There's nothing that I can find. I see Congress has the power to create an army and a navy and a post office, but nothing about creating a private bank & giving it monopoly power.

Re:Scary

[delt0r]

What? Bitcoin is not completely anonymous (and neither is cash for that matter). But its not far off cash either if you manage your wallet properly. Of course nodes can see IP numbers, but are not logged typically. Of course they could be, but again it is quite possible to send transactions via tor for example.

However every transaction is public and without some proper wallet management you would not be so anonymous.

Re:Scary

[delt0r]

This is true. However current economies are set up to always grow, and right now i don't think we can get another century of that. For example population sizes of a lot of countries is now stabilizing or even going slightly negative.

Re:Scary

[NeutronCowboy]

but gold and land do have a constant scarcity,

They don't. Gold definitely undergoes supply changes (what do you think happens when a company finds and opens a new gold mine?), and even land undergoes supply changes: land is lost and gained from the sea, becomes unusable due to natural and man-made disasters, and has its use changed due to social and regulatory changes. And finally, the challenges you refer to in your parenthesis are the reason we aren't on the gold standard anymore.

I agree that an all-digital economy makes electronic robbery of various forms much easier and much more invisible. But that's where regulations and laws can help. The question is: are we willing to support the laws necessary to have a smoothly running digital economy, or are we going to throw our hands up, say "government is evil" , and have the worst of both worlds?

Re:Scary

[Bob the Super Hamste]

Just to clarify the parents last point what Nixon did was close the international gold window thus removing the last tie between the US Dollar and gold. At the time the ratio was fixed at $35 to an ounce of gold. Previous to this, during the depression, the value of the dollar was devalued as the exchange rate was $20.67 per ounce to gold to $35 per ounce of gold. Additionally the government nationalized the gold holdings of the federal reserve and issued them gold certificates. To further move from the gold standard individual US citizens' gold was also take (exceptions made for collectible or ornamental pieces) and individual US citizens couldn't exchange their paper currency for gold coinage. Thus leaving only international gold window open for foreign countries to exchange their dollar holdings for US treasury gold. It was however possible to redeem paper currency for real silver dollars, later silver certificates only, but that ended 1964 when they could only be redeemed for uncoined silver which then ended in 1968. It wasn't until 1986 the individual US citizens could own gold coins or gold bullion again, although many individuals did when it was illegal. Also of note the last currency to not be backed by gold was the Swiss Franc and that ended on May 1, 2000, but even then only 40% of the currency was backed by gold.

Re:Scary

[AnalogDiehard]

I once had a business trip to Germany and bought a cuckoo clock there with my credit card to have shipped home. When I got back to the US there was a voicemail at home from my credit union regarding a suspicious transaction in Germany and they were putting it on hold. I confirmed the transaction and they released it. Apparently this was caught by their theft detection system.

Credit card companies CAN collect what you purchased and where. If your card is stolen, they can track purchase patterns against your history and the system will flag an abrupt discrepancy as card theft and alert the owner.

Re:Scary

[peragrin]

At my previous employer we had digital live records of every transaction of every item our customers bought since 1989 when the system first went online.

I could track the entire history of your purchases of that item how much the price changed, etc.

My new company doesn't keep the active records that long only 5 years worth. but right now I have a P2 HP notebook from the previous company with the Netware networked database on it.

if you want scary look at your amazon account sometime. you can see your entire purchasing history that you ever made through amazon.com. I literally have 12 years worth of data there.

Re:Scary

[tacarat]

Hookers.

Re:Scary

[TheRaven64]

and even land undergoes supply changes: land is lost and gained from the sea, becomes unusable due to natural and man-made disasters, and has its use changed due to social and regulatory changes

Add to that: scarcity isn't just about supply, it's about the ability of supply to meet demand. With the global population doubling every n years, the ability of the supply of land to meet demand is obviously dropping because the amount of land per capita is dropping.

Re:Scary

[fahrbot-bot]

VISA does not know how many candy bars you bought, retail corporate does.

Target certainly knows this - and more. See this NYT article: How Companies Learn Your Secrets. From page 7 of 8:

About a year after Pole created his pregnancy-prediction model, a man walked into a Target outside Minneapolis and demanded to see the manager. He was clutching coupons that had been sent to his daughter, and he was angry, according to an employee who participated in the conversation.

“My daughter got this in the mail!” he said. “She’s still in high school, and you’re sending her coupons for baby clothes and cribs? Are you trying to encourage her to get pregnant?”

The manager didn’t have any idea what the man was talking about. He looked at the mailer. Sure enough, it was addressed to the man’s daughter and contained advertisements for maternity clothing, nursery furniture and pictures of smiling infants. The manager apologized and then called a few days later to apologize again.

On the phone, though, the father was somewhat abashed. “I had a talk with my daughter,” he said. “It turns out there’s been some activities in my house I haven’t been completely aware of. She’s due in August. I owe you an apology.”

Re:Scary

[Bill, Shooter of Bul]

The supply of solar energy is fixed. The sun only puts out so much power. If you have a non zero population growth, you'll eventually reach a limit where you need more energy from the sun, than the sun gives out.

Of course the costs associated with getting the solar energy will also increase as population increases ( all the easy sunny spots will be taken,leaving spots like the rainforest, and england.) Then you've got your volcanic eruptions that will block the sun, causing the value of the stored solar to skyrocket.

And of course, the demand per capita of energy isn't constant either making it even more difficult.

And of course, you need materials to capture the sun's rays, those have a value that will be determined by their supply.

Its just not going to work. Nothing has a fixed value.

Re:Scary

[Firehed]

For me, the convenience of being able to track my own spending far outweighs my ability to care if the government can subpoena where I buy my morning coffee from. I understand (and agree with) your concern, but using payment cards offers a huge number of incentives that cash does not and can not.

And FYI, plenty of criminal transactions occur in the plastic world - and the red tape imposed by the government in trying to prevent that makes my job a lot more painful (and risky) than it needs to be. Criminals are always going to ruin things for everyone else; doubly so when it comes to getting paid. Sorry, that's just reality. Blame stupid law enforcement (see also: war on photography)

Re:Scary

[Nom du Keyboard]

I don't care what sort of up sides it has. The government being able to track every last penny spent is far too frightening to even consider.

Even worse -- or at least as bad -- is the $0.80 transaction fee for every such transaction. And the law that says that you cannot recover this fee from the customer. What the hell is a merchant supposed to in that situation? This is The Banks Make Billions Society now.

Re:Scary

[Lennie]

Some also do mobile phone tracking which means they look where you walk through the store, some even have software which figures out the ID of the phone. So they can combine that data with that of previous visits. Maybe they can even combine that with what you bought.

I haven't looked at NFC to see to see if that would make it easier to do that.

A few years ago

[AliasMarlowe]

Finland was even ahead of Denmark and Sweden on this front. Anyone with an up-to-date comparison between different countries?

Re:A few years ago

[vipw]

I also wonder about the Netherlands. In many places cash isn't accepted, and you can't even use physical currency in banks.

Re:A few years ago

[rufty_tufty]

"So... what does a bank office do"
They charge you money to look after your money for you and handle the transfer of that money to others.
In other words they charge you £10 a month for (I exaggerate here but) a very simple script someone wrote many years ago and a small amount of database space. In return they also get the inconvenience of having your money in their hands.

In this free market I wonder if I could start my own bank?

Re:A few years ago

[myth24601]

Finland was even ahead of Denmark and Sweden on this front. Anyone with an up-to-date comparison between different countries?

It would be interesting to compare the individual US states. The summary says the US has a 7% cash economy, I wonder if some states are higher and some lower.

Woe Be The Day Cash Becomes Illegal

[Bananatree3]

Cashless means dangerous should our electronic web collapse. As long as cash currency is accepted it's always best to keep something on hand. Woe be the day we loose our paper or coin currency completely.

Re:Woe Be The Day Cash Becomes Illegal

[Quiet_Desperation]

That's why I always carry around a few small gold nuggets in case I need to pick up a bag of rice or a horse or something.

Re:Woe Be The Day Cash Becomes Illegal

[Zorque]

Not only that, but what do you do if an emergency (severe weather, flooding, etc) knocks the power out and you need to buy supplies? I don't think debit or credit are very useful in that sort of situation.

Re:Woe Be The Day Cash Becomes Illegal

[Quiet_Desperation]

real gold or fools gold?

There's little difference given a sufficient population of fools. ;-)

Re:Woe Be The Day Cash Becomes Illegal

[CubicleZombie]

But no store is ever going to do that if they can't verify that your account is in good standing. Same with checks. The few stores that still accept checks always verify them electronically first. And a credit card wouldn't be nearly as safe as a check, considering writing a bad check is still a criminal offense (in the U.S.).

Re:Woe Be The Day Cash Becomes Illegal

[Nadaka]

Gold is a terrible currency, the most overvalued material on earth. It has almost no real value. Its only practical use is as a corrosion resistant connector in basic electronics.

The currency that has had the most steady value in terms of a laborers wage over the last 4 thousand years is beer.

Re:Woe Be The Day Cash Becomes Illegal

[SirWhoopass]

The currency that has had the most steady value in terms of a laborers wage over the last 4 thousand years is beer.

Beer is difficult to transport (bulky compared to its value) and spoils rather quickly. Distilling it to whiskey is a better option. The Scotch-Irish figured that out a few centuries ago.

Re:Woe Be The Day Cash Becomes Illegal

[vlm]

None of that has anything to do with being a good or terrible currency.

A good currency is more or less constant quantity, hard to make more on demand. Doesn't tarnish or rot or otherwise disappear over time. Infinitely divisible (unlike, say, seashells or cows). High volumetric value density and high mass value density. Basically the opposite of beer.

Re:Woe Be The Day Cash Becomes Illegal

[jonamous]

I'll give you a chicken and three ears of corn. Look for my smoke signals.

Re:Woe Be The Day Cash Becomes Illegal

[Sycraft-fu]

No, actually, consistent quantity is a big problem for currency because it leads to deflation and you really don't want that, it can hamstring an economy badly.

Simple example:

Suppose you and 3 friends decide to create your own little currency of sorts. You have favour tokens. Each time you do a favour for someone, they pay you in a token, and likewise you pay them when you want them to do a favour for you. Makes sure everyone is contributing. So you each start with 2 tokens.

Things work well, your little economy burgeons as you all do favours for each other and the tokens move around quickly. Other people notice this and want in. So you let them, however new joiners don't get any tokens to start, they have to earn it. Soon you have 8 people. Now there's only one token per person total. So if someone does a favour, someone else is left with no tokens. The economy start to get hamstrung. You have cases where someone wants to do a favour for someone else, but can't because that person has no token and nobody needs a favour from them at the moment.

Then it grows larger, you get 12 people. Now at best there will be 4 people without tokens at all times, and there can be more. Your economy is stalling in a bad way. People have to wait around until the person who wants them to do a favour can do one for someone else and get a token so they can do their favour.

Now all this could be solved simply be expanding the amount of currency. If as the economy grew, more currency was added, this problem would be avoided. This might not only happen when new people join, but just when more is being done. You start doing so much for each other that 2 tokens per person just isn't enough, you need more to keep things flowing quickly.

Money is just something to facilitate trade, no more no less. It needs to do so well and for that, it does need to grow, at least until your economy stops growing.

Re:Woe Be The Day Cash Becomes Illegal

[Stormtrooper42]

Apparently, the main problem with your tokens is that you can't pay a fraction of a token.

Re:Woe Be The Day Cash Becomes Illegal

[gmhowell]

The currency that has had the most steady value in terms of a laborers wage over the last 4 thousand years is beer.

Beer is difficult to transport (bulky compared to its value) and spoils rather quickly. Distilling it to whiskey is a better option. The Scotch-Irish figured that out a few centuries ago.

And if they could avoid liquidating their profits, they'd be the richest countries on earth.

Meanwhile...

[Guppy06]

Visa and MasterCard couldn't be happier.

I've been "cashless" for ~5 years

[GodfatherofSoul]

I never carry it, just by debit cards. An additional benefit is that all your expenses are right there on paper via bank statements so you can evaluate your spending habits. I'd say that 95-99% of the time it's not a problem for my lifestyle, but I do have to hit up an ATM occasionally for the car wash. Now, when it sucks is when you don't realize you'll need cash (cover charge at a door), vending machine snacks, etc.

I can see it not working for younger people and their more dynamic, partying lifestyles but it works well at the micro level.

Re:I've been "cashless" for ~5 years

[harl]

I actually view that as a downside. Why should I pay visa 2-5% of every transaction for the privilege of selling my spending habits to others. Of which I see no profit.

So how do they intend to handle...

[NorthWestFLNative]

Small transactions, power failures, and computer and network outages. Not every business will accept a check.

Re:So how do they intend to handle...

[slartibartfastatp]

Here in Brasil, I've heard that the card companies take ~1% of each transaction. So it's common that stores won't accept anything but cash for cigarrettes (as their margin of profit is thin, so they say).

Also, uptime is a major problem. When I used to go out at saturday nights, systems were always "timing out".

Still better than carrying money around, if you ask me

Re:So how do they intend to handle...

[Oswald McWeany]

OK- you've got 1 hour to get money to the bad guys. They're holding your kitty cat hostage for $20 - or Krona - or Simoleans- whatever they use.

What would you do? A suitcase full of penny coins... OR wire them.... ... oh and the internet is down.

No cash- your kitty cat gets it.

If you love cats you'll be against getting rid of currency.

Re:So how do they intend to handle...

[0123456]

Well you know... waiting an hour or even 8 is not really the end of the world.

So basically your argument is: 'yeah, if we eliminate cash you might have to wait a day before you can buy anything, but who cares? It's not like you need to eat or anything, is it?'

Some disadvantages as well...

[CODiNE]

I agree there are many advantages to a cashless society but one weakness has bothered me for a while. I've personally gone mostly cashless over the last few years and have several times been unable to give anything to a homeless person. At times in the past I've offered food or bought someone a hamburger but there's not always the time or access to nearby vendors, cash is the easiest way to give a little help.

Also just yesterday I met a kid selling candy bars for his school fundraiser and wasn't able to help out there. It's almost like you have to give them card readers these days.

Re:Some disadvantages as well...

[s73v3r]

1). A lot of these fundraiser things are outside grocery stores and such. And most places like that will allow you to get cash back after using a debit card.

2). That's what the Square credit card reader is for.

Re:Some disadvantages as well...

[zzsmirkzz]

I agree there are many advantages to a cashless society but one weakness has bothered me for a while.

It's not the only weakness. Try paying some kid to mow your lawn, shovel your driveway, dig a ditch without cash. Not to mention the real reasons Citizens want cash (easily accessible, accepted everywhere and untrackable) - so they can loan money, barter/trade goods without tax burden (yard sales, craigslist, etc), gamble/wager or anything else you can imagine.

What about WOW gold?

[Quiet_Desperation]

Bills and coins represent only 3 percent of Sweden's economy, compared to an average of 9 percent in the eurozone and 7 percent in the U.S

Sooo... it's more like *everybody* is moving toward a cashless economy, and Sweden is just closest? Um, yay, I guess? Maybe?

From the title I thought they were moving toward the Star Trek utopia with no money at all, and the economy is based on, um, well, I guess that's in one of the tech manuals somewhere.

What about weed?

[TheTruthIs]

How will we buy weed in a cashless society where marijuana is illegal?

explains why they have less trouble with graft

[Attila Dimedici]

No, it does not explain why they have less trouble with graft. Scandinavian countries had less trouble with graft than Italy or Greece before there was even a concept of a cashless economy. It is a cultural thing. It is even possible that the same cultural factors that led them to have less trouble with graft also contribute to them moving so easily towards a cashless economy.

Re:explains why they have less trouble with graft

[Securityemo]

"... The pronounced Swedish inclination to keep order bore strange fruit. A German refugee who stayed in Norway in the 1930s, fled to Sweden when Norway was occupied in 1940. He was arrested in Sweden and the encounter with the police there differed a lot from what he was used to from the Norwegian police. "What I supposed was meant to be a routine series of questions and answers, ended with my being arrested. My declarations did not seem to satisfy the officers. The examination was repeated during the following days. (...) The cell was so clean, it shined. It literally smelled as if it had been sterilized..."

"... The aim of internment was to assimilate these people into a pattern that fit in with the ideal conception of a typical Swede, from the perspective of the Swedish authorities. There were two camps, the one at Långmora and another at Smedsbo, where different categories of deviates were placed. As Jörg Lindner (1994) has underscored in a path breaking article, the Swedish authorities were less concerned about the internee’s political viewpoint. What made internment necessary was that these people were homosexuals, kleptomaniacs, alcoholics, fathers who did not pay alimony and child support, or people who seemed to shy away from the work-world, etc. In addition to these deviances, many were either social democrats or communists. In fact, both camps were reformatories and the people who were interned in them were disciplined in order to adopt the Swedish norms and values. The camps were almost what Erving Goffman (1961) and Michel Foucault (1977) referred to as total institutions. They made use of four techniques in their efforts to change individual behaviour: 1. The rules of order in the camps deprived the internees of all distinguishing personal marks of identity. The individuality of internees was simply not allowed. As in all total institutions, the inmates had to wear uniforms and cut their hair to prescribed lengths and styles, etc. The German refugees who were interned in the Swedish camps felt that they were being treated unjustly by Swedish authorities. "We are punished, but we have not been informed about what we are accused of (). This is a form of treatment that even criminals are able to avoid." German refugees were systematically degraded, discriminated against, disciplined and punished. There were body searches, a ban on correspondence and visits, and the routine subjection to a degrading regimen. In addition to the camp leader and his staff, there were uniformed and armed guards patrolling the camp grounds. 2. Rigorous time schedules were enforced. The internees were to learn how to live an ordered life that was synchronised to ideal Swedish time patterns. 3. A work regime was established in order to habituate the internees to the (supposed) expectations found in the Swedish work-world. What we might identify as German eggheads were to be transformed into hard-working lumbermen, and this sometimes meant being required to cut wood at – 30oC. 4. Work behaviour and work results were keenly monitored and reported. The idea was to document the individual internee’s progression according to prescribed plans, and to correct unintended deviations from those plans by systematic observation and record-keeping. The internee’s progress in cutting wood was written down on paper designed for logarithmic calculations..."

A Comparative Look at Scandinavian Cultures: Denmark, Norway and Sweden and Their Encounters with German Refugees, 1933-1940

Why is crime rate even mentioned?

[MailtoDelete]

Whenever you hear of someone pushing to get rid of hard currency, they mention the decrease in crime... Yet the numbers here don't show me anything compelling. They show an 85.5% decrease in reported crimes relating to hard currency, and then gloss over a 505% increase in digital monetary crime. That's such a poor point to argue, why even mention it?

Re:Why is crime rate even mentioned?

[0123456]

That's such a poor point to argue, why even mention it?

Because there's no legitimate reason for eliminating cash, so they have to make something up.

If not for patents we would probably be using anonymous digital cash right now, but they delayed the introduction so long that credit cards ended up being the primary means of purchasing online.

Re:Why is crime rate even mentioned?

[chill]

Are you kidding?

"Stick 'em up. Bang! Bang! Someone call 911!" versus "Damn, someone spoofed my credit card. I'm out $50. Let me call my bank."

What part of violent crime is much, much worse than financial crime aren't you understanding?

Crime moves if currency moves

[mapuche]

Here in Mexico the banks started to increase the number of debit cards, less people with cash means less robery, but an increase in "fast kidnappings". Basically they kidnap anyone randomly using any vehicle, being a taxi the most usual and in 3-4 hours visiting banks they empty you bank accounts.

Black Market trade

[dutchwhizzman]

Will still be using cash, even when forced to use a foreign currency or plain gold. Maybe the "official economy" will become cashless, but unless you can make a direct barter deal, some form of currency will still be used to exchange goods or services.

Maiden?

[KingAlanI]

did you mean to reference the Iron Maiden song 22 Acacia Avenue with your sample address?

anyway, I don't see how people knowing that you bought hamburger buns is a big deal.

It's not the government ....

[DogDude]

Forget the tin foil hat government paranoia. The HUGE problem that most people overlook is that you're handing 3% of all retail sales to Visa/MC. The problem is that this is out of sight and out of mind for 99% of the population that doesn't have a merchant account, and that people don't think that every time they use a card, Visa/MC is getting 2-3%. That's an absurd amount of a country's GNP to pay into one organization for what boils down to a convenience.