My 7 Month Cashless Experiment

Now, I am not saying that we should eliminate money. At this time, there are simply too many political, logistical, and social issues that will stand in the way of that Utopia. However, I am suggesting that we go Cashless. There is a difference. Money is what we use to trade for goods and services. Cash is the physical representation of money. Since January of 2014, I have conducted a small experiment. I decided to discover the impact and consequences of going cashless. I am the type that wants to be as unbiased as possible, and if I am going to complain about something, I am going to know what I am complaining about, and bring up realistic solutions to whatever my gripe is.

So, what did I rely on, and what happens when someone gave me cash? Well, what I would always carry will be my photo ID, my Google Wallet card which has all of my discretionary money, and if needed – I could transfer money from a credit card to my Wallet account. Last I had my Public Transit card. The ID had nothing to do with going cashless. However, to ride the public transit system, I used the Public Transit Card. When I needed to refill the card, I used a credit card, or my Wallet Card. So what happens when someone handed me cash? Well, I placed it in an envelope and would take that money down with me the next time I would be close to my bank. Once a month, I will take $10 of that cash to do laundry. This is because the Laundromat in Troy Hill supports only cash. Once my money was deposited into my bank account, I can then pay bills, or transfer to my wallet. Also, the shoe repair shop will require a minimum of $10 for cashless transactions. If need be, I will get cash – but will be spent within 15 minutes to address the shoe repair. The only other instance in where there is some form of physical representation will be my Landlord and sending him a check. However, I pay my landlord through the bank’s site and they mail him a check with no additional cost to me. However if my Landlord would take Google Wallet, he could get his money in minutes on the first rather than maybe the 3rd – 5th of the month, only to have to take time to deposit it.

Again, let’s go into the difference between cash and money. Cash is a physical thing. You can touch it, and put it in your pocket. It can be stolen, lost or given away rather freely. Money is the backing of a government and promise to honor a means of trade without having to rely on goods. At one time, cash and money was one and the same. Then came the banking system, and computer transactions. Think about it. If a Millionaire went an bought a $400,000 car – do you really think he is going to bring a briefcase with $400,000 in the dealership? No, he is going to write a check. That check is a promissory note of $400,000 that authorizes the bank to take that money and give it to the dealership. Now, do you really think that banks send large sums of money to each other? In a time before computers – yes. There would even be $100,000 US Notes that could be used to purchase something. These were typically used between banks. Now, it is a simple modification of a computer system and databases. Already – most of the money that transfers and used in commerce is digital. So what are the reasons for not going cashless? Well continue reading

Religious

In Christianity, and I am sure a few other religions, one of the assurance of the apocalypse is the mark of the beast, and how no one can do commerce without the mark. Now, let’s look at this period of  time. Think of a time when all of the world’s authority forces you to have a micro-chip embedded in your hand, or forehead. Once that starts happening – then one might want to be concerned. Yes, going cashless can be a prelude to this, but there could be more imperative indicators of such that would help push on the apocalypse further. While I am no expert, I will think there has to be a number of other events that will have to occur.

Legal

One may call on legal and privacy issues as a reason to not go cashless. If you use any loyalty cards, an ATM card, gift cards, or credit cards – you have already given up that privacy. Sorry to say, but all of those transactions are trackable. And if you think you are going to “Stick it to the Man” by using your loyalty card to get discounts, and paying with cash, then think again. While the exact serial number may not be traced, that doesn’t matter.

However, let’s look at another legal issue. No matter what you may think of the immigration laws in your country, there is still a legality issue of immigration. So, when an illegal alien comes into the country, and uses cash – that illegal alien can live years if not decades in the country. All the meantime, they also consume resources of your country without paying into it. With a cashless system, his money has to be tied to him In a country with very strict immigration laws, he may not even be able to get a bank account to hold his money. This means all illegal aliens will have to barter the very old fashion way to get the things they need. A country with a cashless system will very likely never have an illegal alien problem.

And what about black market. When has the local crack or heroin dealer take your credit card. It’s not that hard to accept credit cards. A simple $19 device that plugs into the headphone jack of your smart phone, and you pay about 3.5%, and anyone can take credit cards. So, why not the heroin dealer. Because cash is much harder to link to illegal trade. What will happen if the heroin money gets into the banking system without being laundered? Well, you can guess. This means that the Black Market trade in any cashless country will be almost eliminated.

Cost

An ATM, Credit Card, or other card will cost about $2.50 per card. A secured card with embedded encryption such as in Europe will be about $5.00 per card. If you have a bank account, and you will if you had a cashless society, the bank will give you a card for free, and eat the $5.00 cost. The United States Federal Reserve has set aside $827 Million dollars just for the production of paper cash for 2014. Paper notes rarely last more than 24 months. So, how much will it cost next year, or 5 years from now. And that money adds up. Imagine what the United States Government can do for its citizens with an extra $827 Million +? Now, a card can last 4 or 5 years. That now becomes an average of $1 per year. And the value of that card – well the value of the bank account. In the end, the card, even at the premium will be much cheaper than the cost of your cash in a single month.

Economics

There might be some people saying what about when you go to another country, and when people come to a country with a cashless system? Well let’s look at a person that is going to a country with a cash system. Most of those retails will have Point of Sale Systems where they can support cashless payments. And the places that don’t, one would use their money card at an ATM, and pull out the cash they may need. And the people entering a cashless system? Well if they are visiting, they will likely use their credit card. This means cashless. And in most cases, one has to convert their cash to the money the country uses. It is just the process of doing such. If the person is going to live in the country, they are going to get a bank account where their money and income enters.

Social

How can one gift money to another, or loan money? Well, here is a thought. I have a Google Wallet account. My brother has a Google Wallet Account. He would sometimes hand me $5 so I can send him $5 to his Wallet so he can make an in-app purchase. So, this means I just have to have his email address, and he can get money from me. Now, 40% of the people in the United States has a cellular device. As prices of smart phones decrease, their availability should increase. I know someone who was able to get a relatively competent smart phone for $100 (no contract). Even without that into consideration, a simple change in the country’s banking system can assure that everyone can receive money from anyone. This could be done through a deposit only number. This will allow people to freely give this number out and not worry about people taking money out because it is a deposit only number. Anyone can go to an ATM or to their bank’s secured account site, and send money to another person just by knowing this deposit only number. And of course, we can (if we must) rely on legacy and obsolete checks.

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