Thursday, January 12, 2006

American Money is a Mess

I just got back from a periodic visit to the ATM. As is usual, I withdrew $200... I figure this makes the $2 fee more-or-less reasonable. (I have a young friend who gets $20 out at a time, to help him control his spending habits. Sheesh!)

Of course, I got ten $20 bills. Since I got lucky enough to get brand-new bills, it took me a minute or so to get them separated enough so I could count them. Given that the dollar has lost 95% of its value over the last century or so, why the hell don't we use fifty and hundred-dollar bills? In Europe, the €50 note is the most used. Why not here? Besides ATMs never dispensing anything larger than a twenty, it seems like a lot of places I spend cash at get rather perturbed about having to deal with a $50 or $100 bill, if they accept them at all.

Also, I don't understand our obsessive attachment to the $1 bill (not to mention total rejection of the $2 bill). They're almost always grungy and grimy, especially when I need to feed one into a vending machine. Why can't we use $1 coins, like the rest of the world? That is, there's no such thing as a €1 (or even a €2) bill. But they do have €5, €10, €20, €50, and €100 bills, all of which are used routinely, and can be had from an ATM.

In Japan, once I found an ATM I could use (with English and connected to my bank somehow), I requested ¥10,000 (which is a little scary, but was about $85 at the time), and out popped a single ¥10,000 bill. Easy to count. As best as I can recall, the smallest bill is ¥1000, and the largest coin is ¥500. You get used to using ¥100 coins like quarters, even though they're worth close to a dollar now. Japan's not cheap.

Europeans deal with 1¢, 2¢, 5¢, 10¢, 20¢, 50¢, €1, and €2 coins, evidently without getting terribly confused. Americans have 1¢, 5¢, 10¢, 25¢ coins, and people think dollar coins will get mixed up with quarters. I don't know why we don't seem to have any 50¢ coins in circulation anymore, either (I've heard they are popular in Las Vegas).

One big difference is that American money is still based on traditional real money, that had inherent value. Up until 1964, a silver dollar had about 99¢ worth of silver in it. And a half (coin) had about half the silver of the dollar, a quarter likewise half of that, and of course dimes were a tenth. Since our money was converted to subway tokens in 1964, it hardly matters what size they are, and the Europeans, getting to start fresh with token coinage, got to make a nice sensible range of coins.

Now, I've gotten to verge of going on about fiat money vs. hard currency, so I've got to stop. Otherwise, this post will fill up my entire allocation of space at Blogspot.


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