We’ve seen the de-emphasis of cash in Scandinavian countries. There, almost everything is on plastic.
Elaine and I depart tomorrow morning at Oh-God-Thirty for our trip to marry off my youngest daughter and you know much of a role cash plays in trip planning these day? Almost – but not quite – none.
The only places where I plan to use cash are down to tipping and casino use.
Tipping because there is no other way to pay the people who get things done (try putting a valet tip on plastic…which I will – we like that kind of research). Casino use of cash is also a no-brainer. My whole “stake” is $100 and that begins each day of play – when it’s gone, that’s time to leave the casino.
It’s going to get a lot worse.
Cash has been slowly getting hammered. Since it is stock and trade in the drug world, police have been making assumptions that have led to a lot of innocent people having their cash seized under civil asset forfeiture laws, which are an abomination and affront to Constitutional law.
Now, looks like the Apple folks are upping their game in the cash-replacement world.
It seems to us that government may have “dirty hands” or “sticky fingers” in all this. Rather than be a country where a presumption of innocence was a foundational cornerstone of law, we have quickly moved into a world of presumed guilt. Unless you have money, in which case, there’s always court shopping…
Who am I to question a bright fellow like Tim Cook, right? So I did some research on how much coin in being produced by the U.S. mint:
If Cook is right about disappearing cash, we should see much smaller numbers if we pull the data from 10-years ago, right?
Turns out, in the easy data retrieval we can only get as far as 2011 data:
Hmmm…lots and lots more coin is around…
It may seem a bit quirky of us, but things like the U.S. Mint Annual Report (here) make for interesting reading. There, for example you can look at longer timeframes for coin production, but if you’re not careful, your thinking can be skewed.
In other words it may look in this chart like there is a lot of “noise” to coin production, but in reality – because so much of the Mint’s output is numismatic (collectable) coins – the demand varies a lot with disposable income. Notice how the chart above looks for 2008-2009 when we were making a good attempt at economic collapse.
The actual “cash” used involves a lot of paper, but that comes from the Bureau of Printing and Engraving, not the Mint. And it’s NOT U.S. Dollars, it’s Federal Reserve Notes.
Some distortion of the outlook for cash comes because of changes to how it is manufactured: You see, it wears out:
With a trip which will involve visiting four casinos on tap over the next couple of weeks, I can assure you that the use of cash in casinos is down: All the slots are paying off in bar codes, chips and cash are being exchanged at the cages, mostly, although you can still walk up to a blackjack table with a hundred dollar bill and play most places. But, not all.
So yeah, I suppose the outlook for cash is dimming.
The best news about its disappearance is that over time, we will likely see an end to annual income tax returns along with it. The overwhelming use of computerized accounting systems has already removed most of the pain from preparing stock and investment reports as part of the income tax process. You just download the trading data and toss it into the tax software. Wash sales…all those once-complicated items…all fading into the background. Five years ago, I purchased annual gain/loss calculation software. Last year? Three clicks and done.
Eventually this will come to everything you have: Your electronic checking account already makes seizure and theft a push-button crime. The final transition phrases to a cashless society should wipe out tax accounting…but we’ll see.
Government is pretty crooked, so no reason not to ensnare people in Accounting Traps. You report one level of income and if you’re not exactly right, you’ll get a letter, or worse, an audit. Government’s way of playing games with us so they can exert power over us. We is tax-chattle, after all…
And that’s one of the big attractants of Bitcoin. People don’t trust the government – now more than ever – at least for the past 41-years – says a story about Paul (who we also don’t care for) Ryan and his cronies.
The reason people like the crypto money?. It’s something we talk about all the time around here: Honest Money. Hard to steal, hard to impound, hard to forfeit.
If you can’t trust the government, who can you trust?
Well, the data seems to suggest “just about anyone else.”
Fed Parade Day
We have all kinds of FedSpeak coming our way…so brace for a round of Janet Sez’ing later on today. Markets are relatively calm, so far this morning (because news flows are down to stupidity, inane, and moribund items).
Maybe Janet can shake things up a bit.
Meanwhile, we have new jobless claims data…
In the week ending November 7, the advance figure for seasonally adjusted initial claims was 276,000, unchanged from the previous week’s unrevised level. The 4-week moving average was 267,750, an increase of 5,000 from the previous week’s unrevised average of 262,750.
Long-term trend is down so the world isn’t ending.
On the other hand, the Baltic Dry (shipping numbers) just dropped down under the 600 level, so that’s not a good look-ahead numbers.
What seems to be out there is a bigger problem we have talked about before: Capitalism is not designed to work well at the “stable, everyone happy” level. It works best with huge problems like massive growth or a world war to produce for.
When economics get stable and begin to look sustainable…things really go to hell for capitalists which is why corporations hate low rates: Means their one idol in the center of life (double digit growth) will have to come from new gotta-have-it products, not from much easier war, terrorism, security state, and world wars.
Minutia and Superwoman
Did I, or did I not, tell you the media was down to scraping the bottom of the barrel?
I can sit here and talk till I’m blue in the face about real items of concern that impact all Americans at some level – and no one cares.
For example, I tell you that the price according to Triple A of unleaded gas nationally this week is $2.20- and a year ago it was $2.93…and all I get are blank stares.
But comes this Hairlary Clinton story and FB and Twits explode about it.
That speaks to the core problems of America. I am now going to observe a moment of silence since the country formerly known as The United States no longer exists.
To prove it, let me ask you to point out an actual southern border… And by administrative fiat, how many young men of military age are we about to import?
It’s gotten to where the only person you can trust is the person in the mirror. Even that guy looked questionable this morning.