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“Panic-Driven Hoarding Of Bank Notes”: People Aren’t Abandoning Cash During The Pandemic, They’re Socking It Away
“Panic-Driven Hoarding Of Bank Notes”: People Aren’t Abandoning Cash During The Pandemic, They’re Socking It Away
Habits change in the midst of a global recession, not to mention a global pandemic. We have already looked at how the pandemic has caused seismic shifts in many industries, but it is also causing a shift in how people think about, handle and (in this case) hoard cash.
While we have been told non-stop that the pandemic is going to prompt the demise of paper currency and the words “digital dollar” continue to make appearances in government white papers and studies, the Bank of England found that there was actually a marked increase in bills in circulation in places like the U.S., Canada, Italy, Spain, Germany, France, Australia and Russia.
And while we continue to hear arguments about a cashless society being more efficient and less virus-friendly, it would still pose a major challenge to implement and would – in the case of this study – directly contradict how people are handing their cash during the global pandemic, according to Bloomberg.
Charles Goodhart and co-author Jonathan Ashworth wrote in their study: “While the economic shutdowns and increased use of online retailing are currently diminishing cash’s traditional function as a medium of exchange, it seems that this is being more than offset by panic driven hoarding of banknotes.”
“Cash in circulation has actually been growing strongly,” they continued. And while it may just be a small portion of a percentage of the cash that Central Banks have printed, the velocity of money can’t be ignore for inflationary purposes.
The research stands at odds with President Donald Trump’s former economic adviser Gary Cohn, who recently advocated for the disappearance of cash. Up until now, cash use has been on the decline due to credit cards and electronic transferring of money.
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RFID-Chipped Banknotes Fit For “Remote Cancellation”
RFID-Chipped Banknotes Fit For “Remote Cancellation”
RFID Technology fur Use in Currency Becomes More Sophisticated
The 500 euro banknote barely circulates in Europe – this is to say, it is rarely seen in everyday commerce. However, it does exist, and makes the handling of large amounts of cash easier. Not surprisingly, it is said to be highly popular with various criminal organizations, although as far as we are aware, there is no hard evidence of this. Rather, it seems to be an assumption, if a sensible one.
Hitherto, the ECB was mainly interested in the possibility of employing RFID tags in banknotes for security reasons (to make forging them more difficult), and as passive tracking devices, ostensibly in order to be able to track money used by organized crime so as to prevent money laundering.
10 euro bill after 10 secs of microwave treatment
Image via dvd-svcd-forum.de
Work on this ‘feature’ started in 2001 already:
“In 2001, the European Central Bank started working with technology partners on a hush-hush project to embed radio frequency identification tags into the very fibers of euro banknotes by 2005.The ECB was deeply concerned about counterfeiting and money laundering. Counterfeiting of euro notes has been a problem in Greece and there have been cases in the new member countries too. In 2003, Greek authorities were confronted with of 2,411 counterfeiting cases and seized 4,776 counterfeit banknotes while authorities in Poland nabbed a gang suspected of making and putting over a million fake euros into circulation. Money laundering was also an issue of increasing concern, and that was probably one of the reasons that the higher denominations were considered for tagging (€200 and €500 notes).
…click on the above link to read the rest of the article…
