Need opinions for essay

[Spencer Brown]

Pros and cons of the world switching from printed and coined money to strictly card swipes (debit, etc)?

Have to write an essay just wondered peoples' thoughts.

[Slick Rick]

Off the top of my head:
Printed/Coined(Pros):
-tangible asset.. it's in your hand.
-wear and tear pretty good for coins, although dollars are flammable.
-tangible assets can't be hacked.

Printed/Coined(Cons):
-Duplication and counterfeiting, and it'll take experts to know the real from fake. With every new print, they at least try to make the dollars less counterfeit-able. Trying to counterfeit coins would probably cost too much for what it's worth, as the alternative metal would probably be more expensive to use.
-Some extended families keep hard cash in their homes, as a way to hide income from the taxman. This promotes home invasions.

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debit/card swiping(pros):
less real estate means easy transportation.

debit/card swiping(cons):
-privacy: people will be able to see what you are purchasing and your purchasing patterns will be made available to others.
-hacking: if you get your ish hacked, you're funked unless you have a solid credit card company that backs you with their insurance services.
-but, what if the credit card companies are hacked? things can get screwy, really quick.
-viruses are out there. whenever software is involved, expect someone to be waiting to jack your numbers.
-stress comes from always wanting to be aware of tiny transactions on your account that you don't immediately recognize.

#GoldDoesn'tLie

[Paul McKeown]

Assuming that with only debit/credit cards then banks will have more money to loan out/invest since all money will be in them which will lead to economic growth.

Will also be alot handier to use only a card and not needing to carry around cash but like Slick Rick said, physical cash is a tangible asset which can be a good thing as of course cash isn't in any form illiquid.

Another con probably going back to the fact that all our money will be in banks and it will probably worsen the situation of how money is traded on, fractional reserves will most likely become even scary (ie. you lodge money in bank (say 100,000) and bank is only required to keep a set percentage of it in their bank and if all money is gone then it will just be a number on a screen so bank has to keep for example 5% will then it will keep only 5000 of it but this will only be a number on a screen so the other 99500 will be lent out and this person will lodge this in a bank as well, bank will keep 4975 of this as a number on a screen and lend out the other 94,525....see how big of a problem this is becoming, 100,000 so far has become 294,025 and yet all this will only exist has numbers on a screen, see how that can be a HUGE problem?....scary in my opinion!)

[Slick Rick]

Assuming that with only debit/credit cards then banks will have more money to loan out/invest since all money will be in them which will lead to economic growth.

Will also be alot handier to use only a card and not needing to carry around cash but like Slick Rick said, physical cash is a tangible asset which can be a good thing as of course cash isn't in any form illiquid.

Another con probably going back to the fact that all our money will be in banks and it will probably worsen the situation of how money is traded on, fractional reserves will most likely become even scary (ie. you lodge money in bank (say 100,000) and bank is only required to keep a set percentage of it in their bank and if all money is gone then it will just be a number on a screen so bank has to keep for example 5% will then it will keep only 5000 of it but this will only be a number on a screen so the other 99500 will be lent out and this person will lodge this in a bank as well, bank will keep 4975 of this as a number on a screen and lend out the other 94,525....see how big of a problem this is becoming, 100,000 so far has become 294,025 and yet all this will only exist has numbers on a screen, see how that can be a HUGE problem?....scary in my opinion!)

Paul, you bring up good points, which got my mind clicking.

Pros of credit/debit:
-National banks will know the credit worthiness of an individual person much better.
-World banks will know the credit worthiness of an individual country much better. The numbers are a lookup away.
-Drug cartels can have their assets frozen with relative ease, because they would be in electronic form.
-Governments would basically have a better hold on black market type activities.

[Paul McKeown]

Paul, you bring up good points, which got my mind clicking.

Pros of credit/debit:
-National banks will know the credit worthiness of an individual person much better.
-World banks will know the credit worthiness of an individual country much better. The numbers are a lookup away.
-Drug cartels can have their assets frozen with relative ease, because they would be in electronic form.
-Governments would basically have a better hold on black market type activities.

Good points bro!

Would it however using my example mean that the credit worthiness/accounts of banks would become ridiculously inflated from what is actually meant to be owned by each person....the concept of money would become even more fickle due to it all becoming only numbers on a screen?

[Slick Rick]

Good points bro!

Would it however using my example mean that the credit worthiness/accounts of banks would become ridiculously inflated from what is actually meant to be owned by each person....the concept of money would become even more fickle due to it all becoming only numbers on a screen?

I see your points. Hmmm, I'm here sipping wine and my mind is spinning. The first bank with not get an initial deposit of money, but digital currency. All money loaned out after this can be divvied with x mount of digital dollars residing in the bank of origin, for safe measure- this is probably the way it occurs now. And as you said, it'll go on and on from person to bank, to bank to bank, etc. Maybe for now that number is 10%, but let's say to kickstart a stagnant economy, the government decides to lax that number to 1%. Sure, the economy will get a boost, but eventually, may go stagnant once again. Or let's say the government floods the economy with digital dollars. At any time, the government would know exactly how many digital dollars are in the market place, and could pretty easily find out the digital net worth of the nation(in digital dollars), as everything is electronic. With hard currency, you really couldn't find the true net worth of the nation, since it's hard to track by its very nature. You could make estimates, but it would never really be exact. Maybe I'm just talking in circles. I'll nap after this and see what I dream up.

In the end, the US would have to have a Central Bank, per se, for digital currency. There would need to be a Central World Bank for digital currencies as well. I think the true digital currency value of any nation would be a math formula away. Assuming coins weren't of value, you'd still have the gold. And all this brings me back to hard currency or digital currency don't mean anything if not backed by some sort of standard like the gold standard. Otherwise, countries would be giving out infinite digital currency. Something has to keep that in check.

[Kurzy]

No currency has intrinsic value other than gold/silver.
So imo there is no difference between paper or plastic, OTHER than the annonymity that paper purchases can offer. (Everything electronic can be tracked)

[Daniel D.]

electronic money:

pros:
shit's fast and easy to access

cons:
can't wipe your ass with electronic money, or use it to clean yourself up after intercoursing someone.

[Chad Clark]

Cash is king. It is alot easier to stick to a budget and not be drowning in debt if you exclusively use paper money. If you only go shopping with money you have in your pocket at that moment, you will never be able to spend money you don't have. Something that is absolutely essential is a written budget. The only way you can get into trouble if you have a budget (and enough cash flow to cover absolute essentials) is if you don't stick to it.

As far as online purchases, debit cards linked to bank accounts I think are the best options. Again, you won't be able to spend money you don't have. Just make sure to budget. It is your gameplan with money. You wouldn't go into a tournament without a gameplan, why would you not have one for your bank account?

[Jarett Smith]

A strictly digital currency:

Pros:

-Ease of transportation

-No more currency conversion when traveling

-General convenience

-Would create a large problem for organized crime outfits who depend on laundered cash. There would be a record of every transaction.

-Theft, even with a surge in hacking, would be more difficult. Forensic banking could trace where your stolen money was wired to and reverse it.


Cons:
-Implementing the new system would place a large economic strain on the "little man" like food truck operators, very small businesses, street vendors, and any other business that depends mostly on cash transactions.

-No more ability to make confidential purchases. Government would be able to track every penny you spend. IRS would be able to audit people with even greater ferocity. This would particularly suck for people in the food service industry who depend on cash tips and underreport tips to the IRS in order to prevent having even more of their earnings stolen.

-Pain in the butt for certain occasions. Scenarios like "Hey man, I forgot I owe you $5. Here you go." or leaving a cash tip would no longer be possible. Unless we developed an RFID based system that interacted with smart phones so I could just tap my card to my buddies iPhone and instantly wire over $5.

-No more gum ball machines dispensing crappy candies and toys at then exits of large stores.

-No more dollar bill origami.

-Would likely result in a massive surge of hacking attacks.

-One step closer to implantable microchips, the completion of the global control grid, and a New World Order.

Tangent:
It doesn't really matter either way, because the current Keynesian powers-that-be will continue to devalue the currency either way until we're brought to Weimar Republic Papiermark status. Diversify your savings among gold, silver, and foreign currencies while you still have the chance.