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Andrew Tobias
Andrew Tobias

Money and Other Subjects

Money Facts

September 24, 1997February 3, 2017

Thanks to Dave Davis for these facts about America’s money (from a book called The History of Money):

  • It’s printed on presses made by Germans and Italians.
  • The average life span of a bill varies from eighteen months for the one-dollar note to an ancient nine years for a one-hundred-dollar note. A bill can be folded four thousand times before it tears.
  • Nearly half the bills printed in a day are one-dollar notes, and 95 percent of the bills are used to replace worn-out bills. [Which, even if accurate and up to date, doesn’t necessarily mean our money supply is growing at 5% a year because . . . ]
  • Coin and paper account for only 8 percent of all the dollars in the world. The rest are merely numbers in a ledger or tiny blips on a computer chip.

The “money supply” used to be an easy concept back in the days when money was money. But how much money is there in circulation today? Just by whimsically taking out a cash advance on your credit card this afternoon (hey, don’t: the interest rate is ridiculous), YOU create money and balloon the money supply.

Actually, with more and more transactions going plastic or electronic, one might expect the supply of physical money in the U.S. to shrink a little each year. Especially if we could get you to turn in those pennies (don’t give me “what pennies” — you know what pennies). But in fact, a good chunk of the money we print, especially those great new Ben Franklin $100 bills, isn’t printed for the U.S. anyway. It winds up serving as the de facto currency in many countries around the world. This is a good deal for us, because it’s kind of like . . . well, printing money. We don’t just give the Russians, or whomever, this money. They have to buy it from us by exchanging something worth $100 for each one. With dollars more or less as good as gold in places like Russia, our printing $100 bills is kind of like our being able to turn paper into gold. Ah, alchemy.

It’s not fair, exactly, but the rich get — or in this case, the richest nation gets — richer.

Just don’t try printing any on your own.

 

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