Has cash met it's match?
I recently came across an article making a case for a cash-less society. One of their main arguments is that in today's society, cash is mainly used for illegal activity.
What do high-stakes robbery, tax evasion, bribery, and drug dealing all have in common? One word: cash. So, should we get rid of cash? In the U.S. at least, it won’t be easy, in part, because the Federal government is one of its biggest boosters.
The article also mentions that $100 bills make up around 80% of todays cash and most of those bills are held in border states. With that said... as with any major change to monetary policy, there will be some(many) consequences to any cash free plan.
Cold, hard cash may allow criminals anonymity, but it also affords honest, law abiding people the freedom to live their lives outside a shaky and corrupt bank system… Beyond that, why should honest people not be allowed anonymity? The day we go cashless, the government will be able to track your ‘every move.’ … This is nothing more than sheer propaganda to enable the money powers to steal from ‘the little people'.
Aside from privacy issues, I'm sure there are a million other possible issues with a cash-less society. My questions for you... Is this a possibility for future generations? If not, what would be the major drawback preventing it?
Via: Freakonomics
In today's world everything is revolving around money and to make a society that is cash-less is highly impossible and never feasible.
I agree that today's society revolves around money but with credit cards, apple pay, and apps like venmo it seems like we could function without the use of cash. It's unlikely, but an interesting idea nevertheless.
Cash is king.
While I get the premise, even I'm not ready to move to a cash-less society (and ~95% of my transactions are cash-less). The true lack of security scares me, and there's a safety in knowing i can walk to the nearest ATM and withdraw cash if I really needed/wanted to. Plus, I know more people than I can count on both hands who still primarily deal in cash for their everyday transactions.
There have been other ideas floated like eliminating the Benjamin, which would be a better first test than eliminating hard currency altogether.
Don't get me wrong...I think blockchain is the future. But change like that will take awhile and be rather politically challenging.
It's pretty comical that these guys are advocating getting rid of cash when half the population still would rather wait in enormous lines than take 5 min online and register for EZ Pass.
Half the population is total mongoloids. They're not going to be able to use bank cards and venmo. Something like 10% of the US population doesn't even have a bank account of any sort.
Total ivory tower thinking here, although I wouldn't necessarily mind it.
Valid point... But it seems a little ironic considering your username is "adapt or die"
Hahahaha. I used to live in the Mid Atlantic. It amazed me when I saw NY, PA, DE, NJ, etc. plates on a car and that same car waiting in a 20-car line in the non-EZ Pass toll lane.
Having looked at investing along this theme, it's a long way off. Particularly in the US, you lads are very backward with your retail banking
Many parts of the world still use only cash. And this isn't just third world countries, it's first world, technologically-advanced countries too.
Germany, for example, is a largely cash-based consumer economy. I remember a few years ago, I tried buying a CD at a store in Frankfurt with a credit card and got this strange look as if my credit card was a foreign object. This does present an issue, though, that many people do not think about. Germans depend heavily on ATMs to be able to withdraw cash. Imagine this: you need cash to pay a bill, buy groceries, or fill up your car's tank, but the ATMs are not working. And, since you live in a cash-based consumer economy, you have no credit card. Sounds like a nightmare, right? Well, about a year ago this happened. The bank employees who drive around the city to fill the ATMs with cash went on strike. Have you seen those pictures of food lines in Venezuela? Imagine those same lines behind an ATM. NPR did a program on this and interviewed affected people. These weren't just paycheck-to-paycheck employees, but doctors, professors, and other professionals too.
The main reason, though, that I would advocate for a cashless society or at least one where ATMs are available, but everyone pays with a credit card is because paying in cash offers no benefit, only detriments. You lose cash, it's gone. You buy a lemon TV, you are at the mercy of the store. You get the point. Furthermore, with the way some cards have their cashback set up, depending on where you purchase your products at, you could save 5% or more on pretty much anything you purchase. So, by using cash, you are not only taking the risk of losing the cash or not having a credit card company to back you up should your purchase break, but you are actually paying a premium...and you're not being rewarded for any of that.
For my experience with Germany: Things like rent and utilities are paid by direct debit from your bank account. Cash is used for smaller things like groceries and consumer goods. People seem to avoid using credit cards at least partially because it takes like 20 seconds for the card to be approved for some reason. A little weird for someone who was all about the credit card rewards, but when in Rome...
I hardly ever use cash and in fact find it annoying, especially when you start accumulating change. However, I wouldn't be keen on getting rid of it. Although we've come along way in technological advancements, our technology is still pretty vulnerable and isn't secure enough these days and in recent years, in an effort to curb spiralling costs, some banks are starting to hold out on covering the costs of fraud:
http://www.bbc.co.uk/programmes/articles/1KD40dVs0FmtnRv4ByszLr8/bank-f…
https://www.theguardian.com/money/2012/may/04/banks-pin-card-fraud
http://www.telegraph.co.uk/finance/personalfinance/bank-accounts/109454…
Bitcoin and other blockchain technology is no better, with numerous incidents where hackers have stolen from major exchanges and consumers are left with zero chance of recovering anything.
With these factors to consider, It may be necessary to hold onto some physical cash.
I avoid using cash. Credit card points for everything. Cant remember who said it, but you get some great deals with cash back. - That being said, wouldn't get rid of cash completely. It is still a great tool to have to tip people and show some appreciation.
I was just thinking... if we were able to hypothetically get rid of cash currency wouldn't that raise the price of gold to some degree since it would become the next closest thing to a physical currency? People could produce very small gold "coins" to be used as a cash substitute for the occasion it would be helpful to a party.
Just kinda thinking out loud on this.
It's likely that the price of gold would go up. The real question is whether we would create our own currency (such as gold) to replace cash. Would we buy and sell drugs with gold?
If there is a market for it, someone will create it. There is def a market. Drugs is the obvious big item, but I'm sure there are countless others.
The push for a cashless society is for two reasons and only two
1) taxation / govt control
2) federal Reserve / treasury / manipulation
Govt hates not being able to gobble up every penny you earn and they hate not being able to fully manipulate the value of the few dollars you have.
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