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P90
P90
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July 21st, 2012 at 4:51:28 PM permalink
Cashless economies. Talk about them or not, but the possibility of such is becoming real.
On the other hand, it's not like the technology wasn't there to go cashless - all checks and credit cards - decades ago already. It got a little bit better, but society's decision is the really important part.


There have been multiple threads here touching the subject. You can also find a lot of articles on it (though 7% mentioned is for $1k+ transactions), positive and concerned, more linked from there. But the overall conclusion, from the experience and the sentiment, is that the idea a cashless society is likely to start being pushed on the populace within our lifetimes.

How do you feel about this? Are you going to jump on such a change, or try and keep the privacy you have now?
There's still going to be cash even in a cashless economy without physical legal tender, of course, and it doesn't have to be something wacky like gun rounds. Most likely just foreign currency. A lot of countries de-facto use foreign money for most exchanges, US public can certainly follow suit when it feels the need.
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EvenBob
EvenBob
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July 21st, 2012 at 5:08:31 PM permalink
What country has a cashless economy now? What country uses no
money? I don't think we need to worry about it for a long long
time, if ever.
"It's not called gambling if the math is on your side."
Beardgoat
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July 21st, 2012 at 5:12:23 PM permalink
This sounds awful. Probably great for bums with no money, but terrible for anyone that likes the luxury of a nice house, nice car, fancy dinners, toys....and gambling!
AceCrAAckers
AceCrAAckers
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July 21st, 2012 at 5:28:16 PM permalink
We should all get an rfid chip implanted. Maybe we should have an invisible mark on the right hand or on the forehead to do all transactions. Those that resist should not be allowed to sell or buy anything. Central Banks, Federal Reserve create fiat money so this seems like the next step.

We are so removed from what is real money that we think that the Federal Reserve Note is real money. Wake up!!!

This all about control. Money transaction is transferring one tangible asset for another tangible asset. In this paradigm, we are trading real tangible asset for debt.
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buzzpaff
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July 21st, 2012 at 5:32:54 PM permalink
I am willing to buy dollars for pennies on the dollar. Thereby giving you a valuable asset ( copper ) for those useless pieces of green paper !
bigfoot66
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July 21st, 2012 at 5:55:09 PM permalink
Quote: buzzpaff

I am willing to buy dollars for pennies on the dollar. Thereby giving you a valuable asset ( copper ) for those useless pieces of green paper !



Dollars are valuable because you must pay taxes in dollars and courts will make judgements in dollars. If the government did not use the threat of physical violence against us in this manner, the market would tend towards commodity based money.
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24Bingo
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July 21st, 2012 at 6:03:01 PM permalink
Commodity? You mean gold? Gold is worthless. It's valuable because you pay taxes in it and courts will make judgments in it, because it's a useful representation of everything else. If the government did not use the threat of physical violence against us in this manner, in theory, the market would tend toward barter, or establish a fiat currency of its own, perhaps under the guise of some commodity for whom this use far outweighs the real one (like the cliché of cigarettes in prison), and likely find a way to use force in its defense.

In practice, the barter would be irrelevant, because if the government did not use the threat of physical violence against us in this manner, it would not exist, and the economy would go from barter to theft until communal measures evolved to stop it. The further evolution of these measures we have seen many times...
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MakingBook
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July 21st, 2012 at 6:38:02 PM permalink
In my line of work, cash is king.

No man's credit is worth his cash payment.
"I am a man devoured by the passion for gambling." --Dostoevsky, 1871
buzzpaff
buzzpaff
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July 21st, 2012 at 8:26:35 PM permalink
Don't you just love it when some stiff making $200 a week owes a bookie $40,00 in a movie or a tv show. Like everybody doesn't have a cut-off , win or lose. I once had to go pick up $10,000 that Henry G. was ahead of a bigger bookie. $10,000 was their number, win or lose. Henry could not bet a $200 baseball round-robin till I collected his winnings.

I assume you operate in a similar manner ?
pacomartin
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July 22nd, 2012 at 3:58:54 AM permalink
Quote: EvenBob

What country has a cashless economy now? What country uses no money? I don't think we need to worry about it for a long long time, if ever.



Iceland, a country growing in wealth for many decades, and having on 300,000 people probably came the closest. There banknotes and coins his 1% of the GDP in the early 1980's and stayed there until all the banks crashed and the currency was devalued. The national bank had to begin printing banknotes because people were so afraid.


As Iceland has given serious consideration to unilaterally adopting someone else's currency (Canada for instance), they might benefit from going completely cashless. That way they can make the switch without the huge cost of purchasing Canadian banknotes and importing them for the purposes of everyday trade. But being so close to the European Union and Britain, with a large number of Americans there, the underground use of Dollars, Euros, and Pound sterlings will take care of the need for private transactions.

Sweden has a strong grass-roots movement to go cashless, and indeed the quantity of cash in circulation has been dropping in the last few years. The Swedish government is making plans to issue a new set of currency in the next few years. They are not eliminating any denominations as the top banknote is still worth about US$145. In fact they are adding a new denomination which will be more convenient for use by ATM's. The current denominations make a US$2.89, US$7.23, US$14.47 to US$72.34 and US$144.68 . The denominations are poorly matched to ATM use, as either too small or too large. The new denomination will be worth US$30 .

Limited cash transactions are considered a burden on small business who has to spend a disproportionate expense guarding money. Canada is trying to make it so that restaurants and possibly street vendors or small stores can confidently operate with "no cash" and not lose too much business. Without the need to worry about being robbed of money, the operation of these businesses will be much safer. I tell Canadians that they have 9 CA$100 banknotes in circulation per capita (including children), and many are shocked. They so rarely use them, that they thought the number was much lower.

The situation in Asia is different. Fear of counterfeiting prevents the countries from printing large denominations. But cash is a high percentage of transactions. Japan has about the equivalent amount of currency circulating as the USA, yet Japan has only 40% of the population of USA, and the majority of American cash is circulating in other countries. The Bank of Japan seriously considered going cashless to try and reign in some of the massive "tax cheating".
pacomartin
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July 22nd, 2012 at 6:14:24 AM permalink
It's a little off track, but my father asked me for $50,000 about a decade ago. He wanted to purchase an investment property, and he was interested in paying family members interest instead of a bank. I called my bank, and asked them if I needed to pre-authorize a $50K check. They said no, just write it the same as you would a $50 check. I was rather surprised, and I asked them if they would contact me if someone cashed $50K on my account to make sure it was OK. They laughed and said that they couldn't go around authorizing every check that was written. I was angry, and I said that I didn't expect them to authorize every check, just huge ones. It might be fraud. At the time I had given them the authority to withdraw money from my savings to cover any overages on my checking account. Needless to say, I was more careful about that authorization in the future. I didn't want someone writing over a check I had written, and taking all my money.

At the same time, supermarkets and drug stores were checking ID in California when you used a credit card to buy $20 in goods. Naturally, it was to cut down on the use of stolen credit cards. I asked several clerks how many people steal credit cards and buy bread and shaving cream. They didn't seem to understand the question.

In 2009 there were just 670 ATMS in Britain the dispensed £5 banknotes. By March 2012, because of a special program there are now over 5,000 ATMs dispensing £5's. The Bank of England made the amazing discovery that poor people use cash as a way to micro manage their spending. So no matter what the overall cost to business, it is one way to aid the poor.

So in answer to your question, I don't think any country will attempt to achieve a true cashless society. The only exception will probably be Iceland, since there currency is severely devalued, and a cashless society will make it easier to use someone else's currency. But a lot has to do with their small size. Most countries that size do not have an independent free-floating currency. A Bahamian dollar or a Bermudan dollar is set $1 to US$1, and their currency is completely backed by US treasury bonds. Same with Belize dollars, East Caribbean dollars, and Arubian currency.
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