Drew Sowersby

graduate school-biochemistry,

This conversation is closed.

Should physical money be a fundamental part of society in the future?

With over 90% of liquidity existing as digits, or credit, it is time to shut down the printing press.

Closing Statement from Drew Sowersby

Money is unnecessary as digits rule the day

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    Feb 19 2011: A more fundamental question is "who controls the money". Physical money is usually issued by governments, who may be representative of the people or not. And typically they get no benefit from each transaction. Most digital payments are controlled by some financial institution and in many cases there is a charge for every payment they mediate. If governments did that there would be a huge outcry against new taxes. If private companies make a profit out of it, we don't seem to care. And governments use the money supply as one lever to manage the economy. Their ability to do so is increasingly in private hands when we use digital money. Governments can pull the levers only indirectly through their ability to limit the credit-granting power of the private financial institutions.
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    Feb 19 2011: I think that physical money wont be around in about then years from now. Sweden already thinks about switching to digital payments. It is safer and more convenient, but it is also better for the state since all e-payments are easy to track. So i think that Tax Offices around the wold just can't wait for that t happen. ;)
    I also doubt if that would take longer in underdeveloped countries. In some countries of Africa SMS-banking is becoming very popular.
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      Feb 19 2011: as well as an exchange on the basics of pay-as-you-go top-ups. Nonetheless I believe that although probably physical money flow will constantly be dissolving, the currencies strictly connected to the gold standard will remain as a safe deposit of capital.
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    Feb 19 2011: My background is in electronic transaction systems. We did multiple experiments in biometric based exchange systems. There is no need for physical money in my opinion. We found that some people feel safer holding physical money, but I believe that is due to their lack of understanding of fiat currency.
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    Feb 18 2011: Probably physical money, especially in underdeveloped and developing countries, will be around for some more time. However, eventually I think it will become obsolete. I see that from my point of view. Even today, most of my transactions are done without the use of physical money.