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Why the Swiss Still Love Cash (bbc.com)
gollum123 shares a report from the BBC: Last month, the Swiss unveiled a smart new banknote to stash in their wallets. The purple 1,000 franc bill was the latest in the Swiss National Bank (SNB) series to undergo a revamp. But this revamp comes as other nations are phasing out their high-value notes and as cash usage declines in European nations, albeit at greatly differing rates. In Switzerland, cash remains the dominant payment method. Here, there's an assumption everyone carries cash, even in an increasingly digital economy. Most don't get caught out buying a sandwich or paying for a haircut when the card payment machine is out of order. If you have to pay for a coffee with a 100 franc note, no need to apologize -- no one will ask if you have something smaller. And for those big-ticket items, some banks even allow you to withdraw up to 5,000 francs per day (or 10,000 a month) at the cash machine without advance notice. Buying a car that costs tens of thousands with cash is also not that unusual.
Why then do the Swiss prefer cash? Two simple reasons are that cash is widely considered to be part of their culture and people believe that using it allows them to track their spending more easily. In Basel, 53-year-old Chris Troiani confirmed this, saying many people she knows still prefer the reassurance of carrying big bills in their wallet. There's also the identity factor: the Swiss identify with cash in part because of how they see themselves. This is a nation which values privacy and doesn't like being told what to do. They see themselves as different to their European neighbors and closely guard those traditions which set them apart, such as languages, political system and currency.
Why then do the Swiss prefer cash? Two simple reasons are that cash is widely considered to be part of their culture and people believe that using it allows them to track their spending more easily. In Basel, 53-year-old Chris Troiani confirmed this, saying many people she knows still prefer the reassurance of carrying big bills in their wallet. There's also the identity factor: the Swiss identify with cash in part because of how they see themselves. This is a nation which values privacy and doesn't like being told what to do. They see themselves as different to their European neighbors and closely guard those traditions which set them apart, such as languages, political system and currency.
Ever tried coming to a local branch and withdrawing more than 5K? In Canada, where I am they will tell you that they don't have that much and that you have to call them in advance next time. So much for it being "your money". The truth is those rules are not made for your protection. The protect the bank from (a) robberies, (b) bank runs.
You could be right, but I don't get this whole 'everything bad is because of money laundering' argument. I have no doubt money laundering is widespread, but has it become any more widespread now compared to the days when drug dealers were hiding suitcases of cash around the place? The world did not fall apart then, as it will apparently do now if we don't crack down on all these money launderers.
The thing that has changed over the last couple of decades is that people are working/living internationally. It is not at all uncommon these days for a rich american to buy a holiday apartment in Paris or London, or a rich hong kong person to buy a flat in NYC as a 'safe place' for some of their savings - and so leave it empty. Or for a bunch of chinese speculators to buy a whole block of flats in London on credit and leave them empty so they can benefit from rampant price increases. It is really just a product of globalisation and low interest rates. But that is not money laundering. Even chinese people evading capital controls in China and buying in the west is not money laundering (of the drug dealer kind). If they have made the money from a legitimate business trade, then since when did the west care about enforcing domestic CCP capital control laws?
It has become ridiculously hard to deal with even smallish (10's thousand) sums of money internationally these days. I run an international business and have to regularly justify to my bank what I'm doing. Every time I deal with a professional or financial service I have to prove where my funds have come from. The whole system seems to be based on guity until you can prove innocence (they could easily spend 10 mins googling my business and figure out it is legitimate). I find it hard to believe this is not more about the govt putting in place future capital controls and wanting to track everything I do rather than a sudden moral panic causing govts to crack down on evil launderers.
The same argument goes with the move to cashless. In my view this will just enable them to continue their monetary policy games once we get to the point where real interest rates are negative 3% or more.
You could be right, but I don't get this whole 'everything bad is because of money laundering' argument.
That's because you probably are a nice person who doesn't really spend much time thinking about how to screw your fellow human beings for monetary gain. Unfortunately enough people do spend time doing this that it's a VERY serious problem.
I have no doubt money laundering is widespread, but has it become any more widespread now compared to the days when drug dealers were hiding suitcases of cash around the place?
Accountant speaking here. TLDR version is yes it has become more common because technology has made it easier that ever. Why do you think technology like bitcoin is so popular for illegal goods transactions? Money laundering is nothing more than any series of transactions that makes it difficult to trace the origin of the cash. Think of it a bit like encryption - you can often crack it with enough time and resources but the point is to make it so much work that it isn't worth the bother in most cases. Cryptocurrencies are almost a wet dream for people wanting to launder money. You don't have to have untraceable transactions to launder money - you just need enough transactions of the right type to make tracing cash flows challenging.
The world did not fall apart then, as it will apparently do now if we don't crack down on all these money launderers.
I think you don't really understand the scope of the problems money laundering facilitates. Money laundering is critical to financing, among other things drug dealers, terrorist organizations, dictatorships, illegal trade, circumvention of sanctions, human trafficking (slavery), theft, fraud, extortion, racketeering, and the list goes on for some time. The drug dealers you use as an example are merely one case among many. It's quite clear that lack of controls for money laundering would result in substantially worse world to live in.
If they have made the money from a legitimate business trade, then since when did the west care about enforcing domestic CCP capital control laws?
Those statements have nothing to do with each other. First, there is a LOT of trade that looks like legitimate honest trade on the surface but really isn't. Ever heard of a front organization? Those are super common and they rarely exist for reasons positive to society as a whole. No the west doesn't care about Chinese capital controls except insofar as they affect the west but they don't need to to have a legitimate interest in combating money laundering. You can't stop money laundering completely but like many things it's not a good idea to just sit back and ignore it altogether either.
It has become ridiculously hard to deal with even smallish (10's thousand) sums of money internationally these days. I run an international business and have to regularly justify to my bank what I'm doing. Every time I deal with a professional or financial service I have to prove where my funds have come from.
Assuming for the sake of argument that that is true, then you are probably doing it wrong. Yes banks are required by law under know your customers laws to understand the nature of the transactions banking customers are conducting and this is entirely reasonable. That said, I'm among other things a certified accountant and I do a lot of international trade for the manufacturing company I work for today. It's not nearly as challenging as you are making it out to be. If you are being asked a lot about your business then you need to get a better relationship with your bank and learn how to actually do things properly. When I hear people complaining about it, it's almost always because they don't understand what they are doing adequately.
The 1000 Frank note has some geographical info in silvery micro font. Yes, I have one, got it from a regular ATM last week.
The 10 Frank note has swiss tunnels with their length.
The 20 has distance in light seconds to heavenly bodies, Luna, mercury, venus, Sol, etc, ending with CMB at 430 000 000 000 000 000 s.
The 50 has Swiss mountains, just listing them.
Coolest/nerdiest is the micro writing on the 200 Frank note, it has the events after the big bang in scientific time notation. Planck epoch from t=0 until ~10^-43s, then inflationary epoch until "?", then Electroweak Symmetry Breaking until 10^-11s, then the quark epoch until 10^-6s,... It ends with 13.8x10^9 y Now.
Unfortunately, I can't seem to find any link that shows it.
aRTee