A world without cash seems wonderful at first glance since it is convenient and fast. You don’t need to withdraw dollars or euros ahead of time. You don’t have to worry about money being lost or stolen. Paying for things with your phone is a breeze.
Many countries around the world are steadily shifting away from cash. Canada, the United Kingdom and Sweden have already largely embraced a cashless society. The U.S. is also steadily making the move, with people holding smaller amounts of cash.
However, the recent string of natural disasters and security breaches at major financial entities exposes a huge flaw in this trend: When the power goes out, telephone lines shut down or account information is stolen, it is impossible to use ATMs, credit or debit cards or mobile payments – no matter how rich you are.
In other words, giving up cash increases the chance of the kind of economic catastrophe that results when people can no longer easily trade for the goods they need and want. The solution to this national security issue is simple: bring back the currently maligned large denomination bills like the $500, which was discontinued in 1969. Continue reading
There has been a growing war on cash in an attempt to curb terrorism and tax evasion. Much of the focus has been on abolishing large bills, such as the decision to eliminate the €500 note from circulation. However, politicians are also targeting smaller forms of money for elimination. U.S. Senators John McCain and Mike Enzi introduced legislation in March 2017 to eliminate minting of pennies and switch the dollar from paper to a coin only. Continue reading
How much hard currency is held in the Iraq Central Bank? This is a very important question because the news is currently filled with stories about the dramatic takeover of large amounts of Iraqi territory by the Islamic State of Iraq and al-Sham, called ISIS. There are pictures of mass executions and of the Iraqi army abandoning cities. ISIS only came into existence three or four years ago. Standard US policy is to fight extremist groups by a two-pronged approach. One is to physically fight the groups (either directly with troops or indirectly by arming opponents). The second approach is to starve the groups financially. Knowing the amount of hard currency is important because if the Iraq Central bank has a lot of hard currency and ISIS can take it, then the approach of starving the group financially will not work and the only option is a military one.