NEW YORK (Reuters) — America's little-used $2 bill, which occasionally turns up in birthday cards and souvenir drawers, is on a roll. From mom-and-pop stores to strip clubs, the bill is shedding its play-money image and turning up in more wallets.
In 2005, banks and savings institutions ordered $122 million in $2 notes, according to the Federal Reserve System. That is more than double the average amount ordered from 1991 to 2000.
"We noticed the increase in demand beginning in 2001," says Michael Lambert, an assistant director for bank operations and payment systems at the Federal Reserve. That year, banks ordered $92 million in $2 notes. Ever since, orders have grown.
The $1 bill remains far more popular, even though it's twice as likely to overstuff a wallet.
At the end of 2005, there were 8.6 billion $1 notes in circulation and 3.26 billion in $1 coins.
Still, $2 bill use is increasing, and banking and currency experts are not exactly sure why. The surge coincides with inflation, the introduction of the $1 Sacagawea coin in 2000 and rising immigration.
Vendors say people are getting more comfortable with $2 bills.
One group that has embraced the note is the exotic dancing industry. Strip clubs hand out $2 bills when they give customers their change, and the bills end up in dancers' garters and bartenders' tip jars.
"The entertainers love it because it doubles their tip money," says Angelina Spencer, a former stripper who is executive director of the Association of Club Executives, an adult nightclub trade group.
Wine store owner Bruce Gibson is also a big fan of the $2 note. The rarity of getting one helps new customers remember his place, he says, and helps market the shop when customers spend them later.
"The government actually pays for my advertising. Where else can I find that?" Gibson says at his store, the Harwich Spirits Shoppe in Harwich Port, Mass. When customers ask him where he gets the bills, Gibson jokes that he prints them in the back of the shop.
As a currency unit the bill dates to 1776, with various reprintings along the way. Since 1928 it has featured a picture of Thomas Jefferson on the front.
In addition to the inflation factor, Robert Hoge, curator of North American coins and currency at the
American Numismatic Society, thinks demand for $2 bills may be getting help from immigration, particularly from Canada and Europe, where currency denominated in twos is common.
Peter Morici, professor at the Robert H. Smith School of Business at the University of Maryland, says that with the introduction of the SaSacagawea, named for a famous Indian woman, people are beginning to realize the inconvenience of $1 bills.
"In order to have a successful $2 bill, you have to have a successful $1 coin," he says.
Posted 11/07/2006 6:23 pm
