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 Replies: 108 / Views: 18,262 |
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Pillar of the Community
Canada
3049 Posts |
I think it's the 3-5% charge the vendor incurs is the bread and butter of a CC business.
True there are people that don't pay off their CC in full.. as a result there are fees but there are also many risks and the CC companies have to write off some losses as some people simply go bankrupt.
I just had a look at my statements over the last 10 years I had one CC. Total interests fees I have paid less than $500. Yet the CC company has made well over $15K from point of sale fees charged to the vendor.
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Pillar of the Community
United States
4409 Posts |
True my mom who runs a small grocery store pays anywhere from $300 to $500 a month in processing fees to accept credit/debit cards and EBT cards.
When people use cash or write a check she keeps 100% of the money versus the processor taking a cut. To help keep the fees under control she has a sign posted "$5 minimum purchase if using a credit/debit card" and so far no one has complained.
-MV
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Bedrock of the Community
United States
94367 Posts |
AgCoin - good for you. The CC needs you, but you're not a prime customer, of course!
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Valued Member
United States
411 Posts |
Quote:
redlock
You know the ECB statistics regarding cash and banknotes . I can confirm that the €50 banknote is the ''backbone'' of cash here in Germany (and most of the Eurozone). While in Canada and the USA it is obviously the (CDN/US) $20 note. German ATMs usually dispense €10, €20 and €50 banknotes. Many also the €5, a few the €100 (instead of the €5). While ATMs in casinos in the USA dispense all denominations, most of them in banks dispense only $20. So Canada, USA, Euro-zone, Denmark, Iceland, United Kingdom, etc. all are characterized by increase of their cash in circulation (not necessarily in dollar equivalent, but in their own currency). Japan stays about even, but it already is awash in cash (nearly 20% of GDP). Norway stays about even for the last few years. But only Sweden is eliminating cash, and they were the lead in negative interest rates (as far back as 2009). Quote:In May 1976, an economist named James Henry published a wonderful essay in the Washington Monthly titled "Calling in the Big Bills." In it, he observed that "only two kinds of activities in the U.S." required the use of large-denomination currency. One was tax evasion, and the other was organized crime. Henry might also have added certain legal but morally dubious needs, like a compulsive gambler's need to hide his addiction from his family or a billionaire braggart's need to light his cigar with a flaming C-note (though the latter type is probably a creature of myth). In his 1976 piece, Henry proposed that the Treasury and Federal Reserve call in all bills of $50 or more and require holders to exchange them in banks for $10 and $20 bills. http://www.slate.com/articles/busin...njamins.html Circulating Cash per person in US dollar equivalent in 1978 was Canada $320 UK $326 Italy $394 USA $425 Netherlands $679 France $605 Germany $680 Japan $724 Sweden $772 Belgium $1,229 Switzerland $2,008 Keep in mind that USA decided to eliminate the $500 and $1000, $5000 and $10000 in 1969, Sweden the 10,000-kr in 1991, and Canada the $1000 in 2000. Is Sweden a harbinger of the future, or a special case? If we read an article in 1976 calling for the termination of the $100 bill, and another one in 2016, will there be another such article in thirty years? |
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Valued Member
United States
411 Posts |
Since Sweden took it's repo rate to 0.50% in 2009 and -0.50% as of Feb 2006, I thought a of interest rates of central banks would be useful.
-0.75 Jan 2015 Switzerland
-0.50 Feb 2016 Sweden
-0.10 Jan 2016 Japan
0.01 Jul 2015 Bulgaria
0.05 Nov 2012 Czech Republic
0.05 Jan 2015 Denmark
0.05 Sep 2014 Eurozone
0.10 Feb 2015 Israel
0.50 Sep 2009 Bahrain
0.50 Jul 2015 Canada
0.50 Nov 2011 Fiji
0.50 Mar 2009 United Kingdom
0.50 Dec 2015 United States
0.75 Dec 2015 Hong Kong
0.75 Sep 2015 Norway
1.00 Jan 2009 UAE
1.35 Jul 2015 Hungary
1.50 Mar 2015 Poland
1.50 Jun 2015 South Korea
1.50 Apr 2015 Thailand
1.63 Dec 2015 Taiwan
1.75 May 2015 Romania
2.00 Jan 2015 Albania
2.00 May 2015 Australia
2.00 Oct 2012 Kuwait
2.00 Jan 2009 Saudi Arabia
2.50 Dec 2014 Morocco
2.50 Dec 2015 New Zealand
3.00 Jul 2015 Azerbaijan
3.00 Jun 2014 Mexico
3.25 Jul 2013 Macedonia
3.25 Jul 2014 Malaysia
3.50 Feb 2015 Cape Verde
3.50 Dec 2015 Chile
3.50 Sep 2015 Peru
3.75 Jul 2015 Jordan
4.00 Sep 2014 Philippines
4.35 Oct 2015 China
4.50 Bahamas
4.50 Aug 2011 Qatar
4.50 Oct 2015 Serbia
4.50 Sep 2015 Trinidad and Tobago
4.50 Dec 2013 Tunisia
4.65 Jun 2013 Mauritius
4.75 Sep 2015 Colombia
5.00 Nov 2013 Croatia
5.00 May 2015 Dominican Republic
5.00 Jan 2009 Samoa
5.25 Aug 2015 Jamaica
6.00 Aug 2015 Botswana
6.00 Sep 2012 DRC
6.00 Sep 2015 Pakistan
6.00 Jul 2015 South Africa
6.00 Apr 2015 Sri Lanka
6.25 Aug 2015 Iceland
6.50 Jun 2015 Namibia
6.50 Mar 2014 Vietnam
6.75 Sep 2015 India
7.00 Sep 2015 Georgia
7.50 Feb 2015 Indonesia
7.50 Feb 2015 Turkey
7.75 Jan 2012 Bangladesh
7.75 Oct 2015 Mozambique
8.00 Dec 2014 Tajikistan
8.75 Jan 2015 Egypt
9.00 Jan 2015 Uzbekistan
9.25 Dec 2012 Uruguay
9.50 Mar 2015 Sierra Leone
10.00 Sep 2015 Kyrgyzstan
10.25 Aug 2015 Armenia
10.50 Aug 2015 Angola
11.00 Jul 2015 Russia
11.50 Jul 2015 Kenya
11.50 Apr 2013 Mongolia
12.50 Nov 2014 Zambia
13.00 Aug 2014 Argentina
13.00 Nov 2014 Nigeria
14.25 Jul 2015 Brazil
16.00 Oct 2015 Kazakhstan
17.00 Oct 2015 Uganda
19.50 Aug 2015 Moldova
22.00 Sep 2015 Ukraine
25.00 Jan 2015 Belarus
25.00 Sep 2015 Ghana
25.00 Oct 2014 Malawi
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Pillar of the Community
United States
2168 Posts |
I read over the weekend that Greece is charging to exchange a 500 euro bill for smaller bills. Haven't read or heard much more about taking $100 out of circulation
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Pillar of the Community
United States
2168 Posts |
I sometimes wonder how Sweden is basically cashless. Wonder if they ever have power issues during a storm or just a computer 'glitch' as all computer issues are portrayed as!
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Valued Member
United States
411 Posts |
When Richard Nixon took us off the Gold Standard in 1971, the US government went on what was then a binge printing of $100 bills. By 1976 of the roughly $80 billion in paper currency now outstanding in the United States, over $21 billion is in $100 bills. This means that there is one $100 bill for every man, woman, and child in the country - James Henry. The US government had passively retired the $500,$1000, $5000 and $10000 banknotes in 1969 and instituted the Bank Secrecy Act in Nixon's second year. James Henry wrote his proposal to kill the $100 bill (and possibly the $50) in 1976. The reasons are the same as given today, and now there are over 33 c-notes for every man, woman and child in the country. A funny anachronism is that he opened his article by asking people if they knew who was on the $100 bill. Forty years later "it's all about the Benjamins" is a phrase that is widely known. The government didn't kill the $100 banknote in 1976 and they certainly aren't going to kill it in 2016 when it is worth less than a $20 banknote in 1976. Quote:
Calling in the Big Bills by James Henry-The Washington Monthly, May 1976, pp. 26-33
A monetary detective finds a painless way to catch the tax evaders and cripple organized crime
James Henry is a Danforth Fellow in economics and law at Harvard University.
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There are only two kinds of activity in the U. S. which depend almost exclusively upon large, untraceable, non-credit transactions. The first is profit-motivated crime : illegal gambling, drugs, prostitution, loan sharking, protection, the fencing of stolen merchandise, etc. The second is tax evasion by people who arrange to receive cash incomeand don't report it. It also happens that both of these activities have experienced growth which coincides with the turnaround in currency demand since the 1930s.
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When added to the estimate for tax evasion hoarding, these figures suggest that well over half of the $50, $100, $1,000 and higher-denomination bills are held for illegal purposes.
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This nation spends about $15 billion a year on police, prisons, and courts. We know from bitter experience that there is no simple relation between more dollars and less crime. Most of this $15 billion, by far, is spent on attempts to reduce street crime. Comparatively little attention is paid to white-collar crime, whose economic effects, at least, are far more serious. Currency reform would be a simple, inexpensive way to identify white-collar criminals, and to make their continued operation more difficult. Edited by PacoMartin
03/21/2016 8:06 pm
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Pillar of the Community
United States
2168 Posts |
I agree, but it seems the powers that be are pushing toward a cashless society. The more that use debit/credit cards by choice the easier it will be to do so.
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Valued Member
United States
411 Posts |
It is not clear what "the powers that be" are pushing towards. In some ways they are making cash much more difficult to use, but they keep increasing circulation of cash at a rate far higher than population growth, inflation or GDP growth. Sweden is currently the only exception as a country which is a leader in negative interest rates, and also one which is rapidly eliminating it's currency stock and removing the requirements that banks keep a minimum amount of banknotes and coins. They are currently under 2% of GDP for cash and might be headed to 1% GDP. The USA had abandoned it's historic levels of 4%-5% of GDP is headed upwards towards 8% of GDP.
Switzerland also has negative interest rates, but unlike Sweden has very high amounts of cash in circulation.
Edited by PacoMartin
03/22/2016 10:09 am
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Pillar of the Community
United States
2168 Posts |
Not clear, but it seems if cashless all can be watched or traced back-no privacy. And if power out what then?
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Moderator
 United States
189340 Posts |
Quote:
And if power out what then? Stores close their doors when the power goes out here. If the power is out for a long time, then you will have bigger concerns than who is going to take your money. |
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Pillar of the Community
United States
2168 Posts |
I just recall when shopping at even our local grocery store, cash only. I know bigger issues than getting $$ from an ATM or bank but cash is king even when computers go down. Our stores sell for cash only then. Of course doesn't happen often but when it does all should have some cash available.
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Moderator
United States
189340 Posts |
Last time I was in a store when the power went out I was asked to leave. "But I have cash!" "Sorry, our registers cannot be opened when the power is out." I left. I survived. Another time, I was in a restaurant when the power went out and they were able to take my card the old way...  I am not saying cash is going away any time soon, just that it is possible to survive without it. |
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Valued Member
United States
411 Posts |
I don't think you realize that so far no country has tried to eliminate all small value banknotes. Part of the problem is that children cannot use the smart phone apps in Sweden. Banknotes in circulation per capita for USA
35.4 $1
3.6 $2
8.5 $5
5.9 $10
26.6 $20
5.0 $50
33.6 $100
Banknotes in circulation per capita for Sweden
9.1 20 kr = $2.42
2.2 50 kr = $6.05
7.2 100 kr = $12.10
0.8 200 kr = $24.20
9.3 500 kr = $60.50
0.4 1000kr = $121.00
Banknotes in circulation per capita for United Kingdom
4.9 £5
11.3 £10
29.9 £20
3.6 £50
Banknotes in circulation per capita for Euro-zone
5.0 €5
6.5 €10
9.5 €20
24.1 €50
6.3 €100
0.6 €200
1.8 €500
Cash as a:
% Narrow Money - % of GDP
4.11% Sweden 2.12%
4.38% United Kingdom 3.62%
17.58% Euro area 10.33%
45.11% United States 7.74%
In 1991 Sweden declared it's 10,000SEK banknote invalid. It would be worth $1210 today, even more than the 1000CHF banknote from Switzerland. At one time (2001) there were about five 1000-krone banknotes per capita in Sweden. The 200 kr banknote is a new denomination as of 1 Oct 2015. That is why there is less than 1 banknote per capita. The big question is how far is Sweden going to go with this downsizing? Are they going to reduce the number of 500SEK banknotes to only a few per capita? If they do then cash will be strictly for children and for tiny transactions. It will have almost no ability to function as a "store of value". Edited by PacoMartin
03/24/2016 04:24 am
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Replies: 108 / Views: 18,262 |
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Posted 03/07/2016 6:02 pm
