Here's the bear witness from Tim Sablik inward "Is Cash Still King?" written for Econ Focus from the Federal Reserve Bank of Richmond (Second Quarter 2018, pp. 18-21). Back inward the 1990s in addition to into the kickoff decade of the 2000s, $1 bills were most common, amongst $20s inward minute place. (This ranking accurately represents my ain wallet, for what it's worth!). But $100s postulate keep increment steadily in addition to taken over kickoff place.
Indeed, the full value of USA currency inward circulation has been rising over time, exactly most of that arrive at inward value is due to the ascent inward $100 bills.
Clearly, in that location is a puzzle here. As Sablik points out, bear witness from consumer surveys finds that cash is used for well-nigh 27% of transactions inward the final decade or so, exactly to a greater extent than frequently than non for pocket-sized purchases. It seems unlikely that the release of $100 bills inward circulation is well-nigh typical consumers making typical purchases. In circular numbers, the 12 billion $100 bills inward circulation divided past times a USA population of 325 meg implies that on average, every somebody inward the USA has 37 $100 bills inward their possession. The full amount of USA cash inward circulation plant out to well-nigh $4,800 for every somebody inward the US. (This does non accurately stand upwards for the contents of my wallet.)
The measure explanation is that a considerable amount of USA currency is beingness used exterior the US, both every bit a medium of telephone substitution in addition to every bit a shop of value. Some proportion of that amount--no 1 actually knows how much--is for sure helping to facilitate illegal activities. There are ongoing proposals to eliminate large-denomination bills: Sablik points out that the EU ended production of 500-euro notes inward 2016.
For about previous posts on the subject, see:
- "Eliminate High-Denomination Bills?" (March 18, 2016)
- "The Soaring Number of $100 Bills" (June 10, 2013)
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