Mon. Dec 6th, 2021


Wallets like suits and high heels continue to collect dust in the epidemic. Sale With billfolds dropping by a fifth last year, buyers are withdrawing cash in favor of non-contact transactions. Demand for digital payments has more than doubled the market value of platforms such as Adian, PayPal and Square.

Yet maliciously, there is a demand for notes Growing Even their use in retail transactions is declining. From February to February, the physical euro was up 12 percent, the sterling was up 13 percent and the dollar was up 17 percent.

Much of this has been driven by fears of disaster, a familiar theme of previous crises. Millennials ago, fears of a computer sphere pushed the dollar supply by more than a fifth. This kind of behavior is quite reasonable. Even Sweden, which is considered the poster child of the Cashless Society, has suggested giving people some cash at home in the event of a cyber attack or other emergency.

In the financial crisis, high demand for cash was accompanied by the transfer of financial deposits away from banks. The epidemic did not happen that way. The balance of domestic banks has increased Fast In almost all industrialized countries, spending opportunities have declined over the past five years.

Such trends are expected to return to pre-epidemic norms. But growing demand for cash predicts the epidemic. According to Deutsche Bank, the current currency has almost doubled in the last 20 years. This is almost entirely due to large notes, such as $ 100 notes, 10,000 10,000 notes, and 50 50 notes.

The Lex chart shows the value of the common currency

Central banks estimate that about a quarter of sterling and euro notes are used for legitimate transactions. The rest is kept as a repository of values ​​at home and abroad and as fuel in the shadow economy. Kenneth Rogoff, a professor of economics at Harvard, says more than half of most countries are accustomed to currency. Hide Transactions

Canceling large denomination notes may obscure the use of cash for illegal purposes. One of the reasons for the rapid decline in the use of cash is Sweden’s efforts to regulate the informal sector. However, the role of cash as a constant source of price savings will be reduced and this will have a greater impact. The only real incentive to move away from interest rates below the rock would be to move cash from under the mattress.

If you are a subscriber and would like to take precautions when the Lex article is published, just click the “Add to MyFT” button, which will appear at the top of this page above the title



Source link

By admin

Leave a Reply

Your email address will not be published. Required fields are marked *