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It's Time To Kill the $100 Bill, Says Larry Summers
HughPickens.com writes: The NYT has an interesting editorial on why getting rid of big bills will make it harder for criminals to do business and make it easier for law enforcement to detect illicit activity. That's why officials in Europe and elsewhere are proposing to end the printing of high-denomination bills. According to a recent paper from Harvard's John F. Kennedy School of Government, a stack of 500-euro notes worth $1 million weighs just five pounds and can be carried in a small bag, whereas a pile of $20 bills worth $1 million would weigh 110 pounds and would be much more difficult to move around. Lawrence Summers, the former Treasury secretary and former adviser to President Obama, has argued that the United States should get rid of the $100 bill. "The fact that in certain circles the 500 euro note is known as the "Bin Laden" confirms the arguments against it," says Sanders. "Technology is obviating whatever need there may ever have been for high denomination notes in legal commerce."
Critics who oppose such changes say the big bills make it easier for people to keep their savings in cash, especially in countries with negative interest rates. Some people also prefer not to conduct transactions electronically because they fear security breaches. According to Sanders the idea of removing existing notes is a step too far but a moratorium on printing new high denomination notes would make the world a better place. "The United States stopped distributing $500, $1,000, $5,000 and $10,000 bills in 1969," concludes the NYT editorial. "There are now so many ways to pay for things, and eliminating big bills should create few problems."
Critics who oppose such changes say the big bills make it easier for people to keep their savings in cash, especially in countries with negative interest rates. Some people also prefer not to conduct transactions electronically because they fear security breaches. According to Sanders the idea of removing existing notes is a step too far but a moratorium on printing new high denomination notes would make the world a better place. "The United States stopped distributing $500, $1,000, $5,000 and $10,000 bills in 1969," concludes the NYT editorial. "There are now so many ways to pay for things, and eliminating big bills should create few problems."
The summary here cites someone named "Sanders" but there is no sanders in the WashPo article. There is someone in there named Sands (note no "er" in the name) but nobody named Sanders.
Damn_registrars has no butt-hole. Damn_registrars has no use for a butt-hole.
It's basically bigger banks or the central government charging smaller banks to keep their money. The idea is to encourage lending and spur the economy. No personal checking/savings account has negative interest that I've heard of (yet?).
http://www.nytimes.com/2016/01... - Japan this year
Morphing Software
What exactly is a negative interest rate?
It's a euphemism for theft of your money by a bank.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
Individuals don't get b charged. Banks get charged for hoarding and not lending
During deflationary periods, people tend to hoard their money. This gives the hoarding populace an incentive to spend, thus helping the economy out of the deflationary spiral.
Happiness in intelligent people is the rarest thing I know.
Ernest Hemingway
Why is the rationale for getting rid of the $100 bill explained by making an example with a different currency worth significantly more?
There's a perfectly good rationale: spin. It makes the contrast in numbers look bigger, it makes the figures harder to check, and lazy readers will mis-remember it as if it were comparing like with like. (I didn't say it was an honest rationale, did I?)
While I prefer to assume cock-up before reaching for conspiracy, the "unit soup" gambit is so common in journalism that I do wonder...
In a survey of 100 programmers, 111111 thought that duck-typing was a good idea.
This cynical yet short response is sadly very correct and should be moderated up.
If I had $100,000 AUD in a bank here 10 years ago and I collected the interest on it, compounded and never touched the money, the remaining figure of money (I dunno, $120k? shrug) would have _LESS_ buying power than it initially did, 10 years ago.
We ARE being screwed by inflation, (money printing) and general price rises in things. The financial system is messy and few people can see this.
NOTE: we had / have fairly high interest rates here in Australia, in the US, Japan, my understanding is the interest rates are significantly lower, $100,000 US 10 years ago would have increased less than my Aussie $100k and it too would have less buying power than it did 10 years ago.
You either buy into / speculate on the latest bubble / fad which is returning silly profits or you're boned.
The gold and silver hoarders are starting to not sound so crazy.
Guilty as accused, at least up to a point.
However, it is certainly not conjecture that most large retail outfits are actually multi-nationals. Which, by and large, centralise their IT, purchase and logistics operations across countries to some degree. It is also pretty much both logical and normal that said multi-nationals routinely store and analyse data about customer behaviour.
Do you really think that the likes of Rewe and Tesco would bother to exempt Belgium from these analyses?
Considering that Belgium happens to be in Europe, and the considerable penalty for breaching European privacy laws, I would say yes, they would bother to exempt Belgium, since the cost of not doing so can potentially be HUGE, if caught.
You're completely ignoring the cost of cash. For a small store, it typically takes at least half an hour per to balance the register at the end of the day if most people have used cash. That's three hours of employee time per register that you have to pay (or do yourself, if you don't want minimum-ways employees to be in a position where they can easily defraud you). You don't have to pay to deposit the cash, but you do have to pay for someone's time to transport the cash to the bank, stand in the queue, and get the receipt, and for the fuel that they consume doing so. If they're carrying large amounts of cash, you also have to pay for the security and you have to pay elevated insurance premiums for having a lot of cash on the premises.
Cash is better for small shops, but only for very small shops. Most moderately successful small shops would find it cheaper if everyone used credit cards.
No it doesn't take a half hour. as some one that is currently working one part time as suplimental income it takes 5 to 7 minutes to balance a till less time yet for the back office as they use a machine to count bills and change.
---Saying gnome 3 is better than windows 8 not so much a compliment as it is damning with light praise.
The man is described as always being the smartest guy in the room yet nearly every major position he's taken on the economy has been wrong, like 180 degrees wrong. The most recent and damaging was his staunch support and very active role in the deregulation of financial derivatives.
Apparently, Summers doesn't understand how inflation works.
$500 of 1969 dollars would be worth: $3,267.97 in 2015
$500 of 2015 dollars would be worth $76.50 in 1969
$100 of 1969 dollars would be worth: $653.59 in 2015
$100 of 2015 dollars would be worth $15.30 in 1969
Source: Inflation Calculator.
The Federal Reserve has been working hard for the last 100 years to reduce the value of U.S. currency. It is not necessary for Congress and the Department of Treasury to aid them any further in the endeavor as they seem to be getting along just fine.
I once took an excursion to Reddit, and later HN. Unlimited up/down voting sucks when dealing with a hive-mind.