How Feasible is a Cash-Less Society? 617
"Think about this: if the cumulative value of everything in the world were expressed in measures of gold, which theoretically backs the majority of world currencies, does enough gold physically exist to back the paper money value, or has the paper money itself become valuable?
And what about this: how is it that the people who depend upon cash are usually in the middle of the financial spectrum, neither the poorest nor the richest? In most extreme poverty situations, transactions are based on barter. For most middle class people and above, transactions involve checks, credit, and electronic fund transfers. For the working poor, most transactions are done in cash. How does all of this add up to the trend toward a cash-less society, where money is nothing more than numbers in a computer transferred from one account to another, to another? How far off is that future?"
..right with a paper-less office (Score:3, Insightful)
When it comes right down to it - there are a lot of intangibles that using cash provides - plus, is it really faster to swipe, enter a PIN and wait for authorization, than it is to get $2.15 change from a 5?
Me thinks not.
Not possible, lower class vices need cash (Score:5, Insightful)
Remember, just becuase you live online and buy porn online doesn't mean Joe Sixpack does.
Privacy is the issue... (Score:5, Insightful)
For all other purposes I withdraw cash - from as many random ATM's as I can manage.
I'll continue to do so until I receive an absolute guarantee from my bank that my purchasing habits are completly private.
And, of course, there are some things that plastic just can't buy...
Promisory Notes and Bank Scrip (Score:3, Insightful)
no less theft proof? (Score:4, Insightful)
That's like saying steel is no less melt-proof than butter; it just takes a different temperature to pull it off.
Well, if you enjoy being tracked... (Score:3, Insightful)
I like cash because I don't care to receive any more spam in my snail-mail inbox than I already do. I particularly like cash for black market purchases...kinda difficult with credit cards. Also, if you like avoiding all the troubling paperwork of paying income taxes on that $20 that you got for mowing the neigbor's lawn, cash is good.
Can any of you imagine having to set up a paypal account when you are 13 years old just so you can get paid by the guy down the street for mowing his lawn?
Cash ain't goin nowhere...
"Money will always be paper...but gold will always be gold..." -- Hudson Hawk...Mayflower...
big brother =:-( (Score:5, Insightful)
Also that means that if they _suspect_ you of selling/using drugs, they can freeze your finances completely. It gives _way_ too much control to somebody else, based on politics, purchasing habits, etc... It makes my skin crawl.
P.S.
I don't think many (any?) major economic powers even _pretend_ to back their currency with anything real anymore, let alone gold.
Get the government out of the printing business. (Score:3, Insightful)
While it is worthwhile for the government to regulate the amount of money available through monetary instruments and fiscal policy, it seems pointless in our day and age for the government to continue to track the quality of trillions of pieces of paper.
Note that this is not simply a domestic issue - numerous other nations use the greenback for their currency, so this creates a huge bloated government apparatus that is completely unnecessary.
Re:Privacy is the issue... (Score:2, Insightful)
I used to spend significantly more with cash (Score:3, Insightful)
Re:Privacy is the issue... (Score:2, Insightful)
Does cash from an ATM (or bank) really guarantee that your purchasing remains private?
Consider this: The ATM knows which bank account to debit (obviously). The $20 bills you get our of the ATM have serial numbers. The stores you go to will at some point return those $20 bills to a bank. From there it's just a matter of scanning the serial numbers and putting the information into a database.
It's still _possible_ to track your purchases via cash. There's not a lot of detail: timestamp information smaller than a day may be lost, and the bank may not even know which cash register was used. But where you make purchases isn't private.
The data might not necessarily be accurate -- money can be lent, given, or stolen. But how often do you give people (outside your household) $20 bills, and how often do you get a $20 in change when you're shopping??
(Am I paranoid? Nope... I keep on using my debit card and ATMs. Just food for thought.)
Re:Not possible, lower class vices need cash (Score:3, Insightful)
Two advantages to Cash. (Score:3, Insightful)
- Cash is really the only means that we have for anonymous/semiprivate transactions. Everything can and is tracked. Big brother is watching you.</paranoia>
- People with poor planning skills. To many many many people in this world (although perhaps the interection of slashdot readers and this particular group of people is not very large), money that you can't hold in your hand isn't really money: this means that it can and is spent on a whim with not "plan". This is why people get so down in credit card debt that they can't seem to pull themselves out of...
If people are allowed to spend "insubstantial" money that they can't feel slip through their fingers... then many people could have a problem with their personal finances...IOW, credit cards are not for everyone. :)
-Chris
Re:Living in a cash economy (Score:1, Insightful)
It's not always a high-tech solution (Score:2, Insightful)
E.g., every workday I walk down to the cafe [crccafe.com] on the first floor where the staff and I greet each other by name. I order my food, they give it to me, and I walk out. Money is never mentioned. At the end of each month, they snail-mail me a bill and I pay it.
Obviously this won't work for every cafe in the world, but the point is that no PDA's, debit cards, or passwords are involved. It's an old-fashioned tab and sometimes those old-fashioned things work quite well.
Why would we? (Score:3, Insightful)
Still, even though it's plausible to go without cash, in order to eliminate it, you'd have to get the sellers to stop accepting it. How would you do that? The only way would be if the government eliminated cash completely, for example, if they offered to redeem it for credit up to a certain date, and refused to back it thereafter.
For starters, the implications for personal privacy would be substantial, and there would likely be widespread public outcry. But more to the point, cash is a simple method of anonymous exchange that allows economic activity to take place at a very low level. Eliminating it would impact many transactions, as some have observed. Some are illegal, such as drug deals, but others are benign... flea markets and garage sales, poker games, tipping, lemonade stands, and a lot of everyday economic activity among poorer people.
So I just don't see how it's possible, no matter how close we come, to being able to eliminate cash entirely, nor should we want to. We will be pretty close, in fact, we already are pretty close... if we choose to, we can live with minimal cash. But I don't want to go without it completely, and I don't think many others will either. Anonymous paper cash is a pretty profound invention, and electronic transactions will only replace it for transactions that offer substantial improvement in convenience or that require some sort of accountability.
Re:Car rentals require credit cards, not debit car (Score:2, Insightful)
Re:Postmodernism (Score:4, Insightful)
I'm not sure that this was the case. It wasn't that the valued goods became scarce, so much as it was impossible to wield $100,000 around in your pocket. Within a given country, the government provided security as for the value of coin, and in the worst case, that coin had some value if melted down. Later as coutries trusted this sort of exchange fiat money (or completely worthless) was used.
This required the trust that you could get something valuable back if you wanted (say to trade internationally).
In the US at least, it was eventually determined that the economy need to grow and shring, and that fixing equity on stocked goods was innefficient. If we had inflation, for example, we would have liked to have introduced new cash into society to compensate since the price of gold (the US's former standard) didn't directly vary with the rate of inflation.
Things were still safe because you could regulate the printing/coining of fiat monies. But then checking became very popular. Now you had the concept of float. One bank would honor a check (and allow accumulation of credit/cash) before the debited bank could deduct.
Later we have the concept of equity-based loans. I percieve that your good is valued such that I'll lend you most of the money for it. You take that money and spend it (via checks), but more goods and take loans out on them..
All in all, checkable money develops a velocity (the rate at which the same virtual or physical dollar is spent per year) such that our net assets are multiple times the physical printed fiat dollars total value.
In a booming economy, that multiplier increases. The problem is that that rate of boom has to be maintained or there will be a dramatic credit crunch. A recession after a boom is devistating because trillions of dollars can up and dissapear (after all checks are registered).
This would have happened even with a gold standard due to virtual assets and value.
The issue has always been one of efficiency. Yes we're more at risk now that a single number can render our bank-account empty. But we have a much greater ability to refill that bank-account than we did when someone with TNT could "blow the safe" and bring you back to square one. You can be insured, bring out new mortages so you don't starve, and most importantly be paid a heck of a lot more than days of old due to incredible industry efficiencies.
-Michael
Re:Privacy is the issue... (Score:1, Insightful)
The only thing your bank really knows about your spending habits is where you spend it. The stores know what you spend it on.
If you take $$$ out of ATM, they know where you got it, but they have no clue as to where you spend it or for what.
If you buy it with a check at Zany Brainy, they instead get you to authorize an EFT from your acct. Hmm... me does not like that.
Banks, and some retailers, very much want to rid the Untermenschen (us) of "Float".
Re:A cash coincidence? (Score:2, Insightful)
Okay, lets talk about disposable income. Everytime I get paid a certain amount of that paycheck goes to the usual places, taxes, food, rent, gas, etc. Most of these are essentially fixed costs. What is left over is money that I can dispach at my choosing. It will not significantly degrade my economic situation to go out and buy several CD's. Or to go out for coffe 3-5 time a week now and again. Personally I find it much easier to budget my expenses when I can see cash in my wallet, and I can watch it disappear. This is a whole lot easier than trying to keep track of totals in my head 4.85 + 12.34 + 22.15 +
Bottom line: It is easier for some (many?) people to keep track of their money when they have actual bills in their hands. People with credit cards and poor memories (like myself) can sometimes get themselves into trouble. Cash always sets a hard limit, and your friends are much less eager to give you free credit than Visa is to give it to you at 19%
HARD to use cash in some situations (Score:3, Insightful)
Has anyone else noticed that it's actually hard to use cash in some situations? For the most part, I'm totally cashless. I have a central checking account and a debit card w/ the Visa logo. So rather than go to the ATM, withdraw some 20s, and spend them. I just go to a place of business and they withdraw the exact amount for me.
But what about the people that prefer to exclusively use cash?
I worked in a computer retail store for a while. And when people came in and bought a high-high-end PC or laptop with just cash, you'd better believe we noticed it. When someone peels 20-30 $100 bills off a stack, everyone in the store craned in for a better look. And we checked all that money verrry carefully.
A similar story was told to me by a friend who worked at a candy factory. The janitor at the place had just bought a brand-new car, but was complaining that the dealership almost wouldn't sell it to him. Why not? Because he had paid in CASH. $26,000 in cash. He actually brought the stacks of bills to the dealership in a briefcase, all ready to go. And, of course, the dealer was a little suspicious about someone carrying that much cash.
So you see my point? How is it that we have come to trust pieces of plastic or signed pieces of paper as opposed to cold, hard, cash? Somehow America has embraced a further level of abstraction from specie to the point of almost rejecting other forms of payment. It just seems like curious situation to me. I'm not sure if I like it or not, though. Like I said, I'm almost totally cashless. But I'd like to believe that if I wanted to switch to cash-only, I'd be able to use that money for whatever I want. Now I'm not so sure I could.
Re:Privacy is the issue... (Score:2, Insightful)
The good things about a cashless soceity (Score:3, Insightful)
However, the more I think about it, I realize that with some careful consideration and common sense legislation, both could be a great boon to us.
If the government is able to receive real time, compleatly accurate consumer and business spending information (in the aggregate, of course), it suddenly has access up-to-the-second and 100% reliable data for forming economic indicators, which are at best currently formed quarterly.
At that point, the governments economists can catch onto economic trends quickly and react before any major problem begins to occur. From an economic standpoint, it would be wonderful.
The other issue surrounds marketers collecting information. I can't seem to understand the danger in this. I for one really want marketers to know what I'm interested in; We have a real chance to change the role of advertising from a broadbased attack on our senses to facilitate brand reconition for products and services we don't need or want (current) to a tool that educates us to the availibility of products and services we genuinanly would like to know about.
The only key to making this work is a continued diligance in making sure our lawmakers are very specific in the drafting of legislation so information does'nt belong in the wrong hands: For example, governments can only collect data in the aggregate and cannot submit individual information to law inforcement. Or Advertisers can only collect the most basic of demographic information (zip code, income range) about us.
Re:Not possible, lower class vices need cash (Score:3, Insightful)
First off all, your cash purchases *can* be tracked, reglardless of the existence of a mechanism for tracking them. For instance, if prior to committing a crime, you purchased a knife, which was used as the murder weapon, from a local store. Suppose the knife you bought from that store was only sold in your area at the store you bought it from. It is a simple matter for the police to track you down. They simply ask the store personnel to describe the person or persons who bought a similar knife in the last few days... it helps if they already have a picture of you, of course.
Now, secondly, it could be possible to use your credit or debit card to purchase a "smart card" that just contains a certain dollar amount and no identifying characteristics...such cards in widespread use in Europe.
Re:Fake US$ (Score:2, Insightful)
Also, it has to get the moire pattern right and print finely enough to reproduce the state names on the back of the 5 dollar bill. ----> In theory.
In practice, how many store clerks, gasoline-pump jockeys and bar waitresses will check a bill that you hand them very closely? It's usually just "Thank you sir" and put it into the drawer. If a counterfeit ten (for example) is included in a stack of three or four genuine tens, what "normal person" is going to notice?
I think the difficulty of counterfeiting is overstated. A while ago there was a warning issued to our local Chamber of Commerce (I run a small business) about counterfeit $20 bills being passed in our community. They were detectable if you held them up to a light and checked them closely. I asked how many of the business people planned to tell their clerks to start holding all $20 bills up to the light to check them when they were handed in, and everyone(!) looked at me as though I was nuts. Silly question - the answer was "Nobody".
I suspect that in counterfeiting close-enough is good-enough, as it were.
Having said that, I have never (knowingly, anyway) seen a counterfeit bill so I don't know how obvious they really are....