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In the age of corporate and government surveillance, cash has many advantages: * It can be accepted without the help of technology * It can be stowed away in

In the age of corporate and government surveillance, cash has many advantages: * It can be accepted without the help of technology * It can be stowed away in a secure place (in contrast to money on bank accounts, which can "evaporate" in case of a bank failure) * It is very hard to trace and provides a good level of anonymity * It can be sent through the mail or transported physically form one place to another And on the less serious side: * It can be piled up into a giant mountain and burned * It can be rolled into nice wads and used as props in ganster movies (ever seen a gangster wave around his black Amex in a film?)

organsnyder 11y ago
You're missing the most significant advantage to most merchants (in the US, at least): It can be exchanged without incurring any transaction fees. While large businesses see cash management as a not-insignificant expense, small businesses—especially sole proprietors—often don't see the additional effort and risk of handling cash as worse than the 3% they'd lose to transaction fees.
- ThePhysicist 11y ago
  Very good point, how could I have missed that!
- m3rc 11y ago
  Yeah I used to never carry cash, until I started eating at a couple local restaurants that only accept cash
frobozz 11y ago
I agree with your other points, but: > It can be stowed away in a secure place (in contrast to money on bank accounts, which can "evaporate" in case of a bank failure) Only the amount above €100000 (EU) or $250000 (USA) per bank. Personally, I'd rather trust the combined resources of a bank, their insurers, an insolvency practitioner, and the government with that kind of money, than any safe I could install in my house, or even any safety deposit box provider. I'd also rather not pay the premiums on home contents insurance that would cover a loss of that scale.
- GFischer 11y ago
  That's because you trust the institutions in your country (or USA and the EU). In both Argentina and my home country Uruguay, money HAS evaporated from ALL banks due to a systemic failure, see: https://en.wikipedia.org/wiki/Corralito https://en.wikipedia.org/wiki/Corralito So far I've had more money stolen from banks (with aid of the government), than from myself or my house (and I've been robbed several times), but I've never had much money to start with. If you have more than 250.000 in liquid assets, I hope you have many orders of magnitude more invested, I wouldn't store it in cash or in a bank, I'd try to have other assets - I do understand that any kind of assets have risks, in my country housing is very popular because government can't will it away, even if the housing bubble crashes you don't lose everything.
  - spacecowboy_lon 11y ago
    And ask the residents of Cyprus how they feel about that or the UK pensioners who lost money in the Icelandic bank crash.
    - frobozz 11y ago
      IIRC, The UK FSCS covered individuals in the case of the Icelandic bank crash. Only people who didn't claim it would have lost money (up to the guarantee, which was lower back then). Not only that, but back then, interest rates on current accounts being at least 3% (and savings accounts being around 4-6%). Nowadays, the difference in interest between stuffing cash in your mattress and putting it in a bank account is negligible. I don't know what happened to individuals' money in Cyprus. I know there have been problems accessing money held in bank accounts, and the economy is broken after the collapse, but are you sure that money has actually evaporated?
      - spacecowboy_lon 11y ago
        FSCS only covers UK Banks the Uk and Dutch Government steped in to cover the shortfall when Iceland defaulted on their own protection scheme.
happyscrappy 11y ago
It is also hard to verify cash sales at tax time.
vijayr 11y ago
It can be rolled into nice wads and used as props in ganster movie Apparently Escobar kept most of his money in cash. He had warehouses of cash (!!!!) and was spending a few thousand dollars on rubber bands a week to wrap the cash. Plus he was writing off 10% a year because "rats ate them". Criminals lead very interesting lives :p https://en.wikipedia.org/wiki/Pablo_Escobar#Criminal_career https://en.wikipedia.org/wiki/Pablo_Escobar#Criminal_career

organsnyder 11y ago

You're missing the most significant advantage to most merchants (in the US, at least): It can be exchanged without incurring any transaction fees. While large businesses see cash management as a not-insignificant expense, small businesses—especially sole proprietors—often don't see the additional effort and risk of handling cash as worse than the 3% they'd lose to transaction fees.

ThePhysicist 11y ago
Very good point, how could I have missed that!
m3rc 11y ago
Yeah I used to never carry cash, until I started eating at a couple local restaurants that only accept cash

frobozz 11y ago

I agree with your other points, but: > It can be stowed away in a secure place (in contrast to money on bank accounts, which can "evaporate" in case of a bank failure) Only the amount above €100000 (EU) or $250000 (USA) per bank. Personally, I'd rather trust the combined resources of a bank, their insurers, an insolvency practitioner, and the government with that kind of money, than any safe I could install in my house, or even any safety deposit box provider. I'd also rather not pay the premiums on home contents insurance that would cover a loss of that scale.

GFischer 11y ago
That's because you trust the institutions in your country (or USA and the EU). In both Argentina and my home country Uruguay, money HAS evaporated from ALL banks due to a systemic failure, see: https://en.wikipedia.org/wiki/Corralito https://en.wikipedia.org/wiki/Corralito So far I've had more money stolen from banks (with aid of the government), than from myself or my house (and I've been robbed several times), but I've never had much money to start with. If you have more than 250.000 in liquid assets, I hope you have many orders of magnitude more invested, I wouldn't store it in cash or in a bank, I'd try to have other assets - I do understand that any kind of assets have risks, in my country housing is very popular because government can't will it away, even if the housing bubble crashes you don't lose everything.
- spacecowboy_lon 11y ago
  And ask the residents of Cyprus how they feel about that or the UK pensioners who lost money in the Icelandic bank crash.
  - frobozz 11y ago
    IIRC, The UK FSCS covered individuals in the case of the Icelandic bank crash. Only people who didn't claim it would have lost money (up to the guarantee, which was lower back then). Not only that, but back then, interest rates on current accounts being at least 3% (and savings accounts being around 4-6%). Nowadays, the difference in interest between stuffing cash in your mattress and putting it in a bank account is negligible. I don't know what happened to individuals' money in Cyprus. I know there have been problems accessing money held in bank accounts, and the economy is broken after the collapse, but are you sure that money has actually evaporated?
    - spacecowboy_lon 11y ago
      FSCS only covers UK Banks the Uk and Dutch Government steped in to cover the shortfall when Iceland defaulted on their own protection scheme.

happyscrappy 11y ago

It is also hard to verify cash sales at tax time.

vijayr 11y ago

It can be rolled into nice wads and used as props in ganster movie Apparently Escobar kept most of his money in cash. He had warehouses of cash (!!!!) and was spending a few thousand dollars on rubber bands a week to wrap the cash. Plus he was writing off 10% a year because "rats ate them". Criminals lead very interesting lives :p https://en.wikipedia.org/wiki/Pablo_Escobar#Criminal_career https://en.wikipedia.org/wiki/Pablo_Escobar#Criminal_career