Summary: In a commentary prepared for RCW Financial, economist Dr. Scott Sumner explains why governments and banks are eager to discourage the use of cash, and the resulting potential loss of anonymity and future negative interest rates. IRVINE, Calif., Sept. 29, 2016 /PRNewswire/ — Governments and banks are discouraging the use of cash, but a problem with a cashless society is a loss of privacy, explains Dr. Scott Sumner, Professor Emeritus of Economics at Bentley University. He points out that Sweden already is moving toward eliminating all coins and paper money, and Italy and Canada are beginning to discourage the use of cash. Dr. Sumner predicts the elimination of cash would make it easier for governments to impose negative interest rates and could lead to increases in values for gold and alternative currency, such as the Bitcoin. In a commentary prepared on behalf of RCW Financial of Irvine, California ( www.rcwfinancial.com ) and entitled, "Why Governments & Banks Want To Eliminate Your Cash," Dr. Sumner wrote about the irony of the push for a cashless society at a time when there are billions of U.S. dollars in circulation. "Surprisingly, despite the increasing use of credit cards, cash holdings are about 8% of Gross Domestic Product, which is actually a larger share of the US economy than a decade ago, indeed even larger than 90 years ago. The amount of cash in circulation (paper currency and coins) is roughly $4500 for every man, women and child in America. It is believed that roughly half that total is held overseas, but even $2000 per person would be a surprisingly large figure, far higher than people admit to in government surveys. Ironically, it is this increasing popularity of cash holdings that helps explain why governments are so anxious to discourage the use […]
