Born in 1954, I remember paying a nickel for a candy bar. At my last check several years ago a candy bar is now $1.50
The credit card has insinuated itself into the U.S. economy not merely as a line of credit (spending money one doesn't have), but also as a medium of exchange.
Card reader technology is advancing to the stage where the credit card need not be "swiped" through a slot, so the magnetic strip can be read, an offshoot of tape recorder technology.
RFID enables the card-holder to merely tap the card on the reader to complete the transaction. And it doesn't end there. The smartphone can replace the plastic card entirely.
- The banks that offer these services, often free to the retail purchaser, derive their revenue by skimming a share of the retail profit from the sale. Reportedly there have been times the credit card company earns a larger profit from the sale of a gallon of gasoline than the "brick & mortar" gasoline station.
The retail products price is often the same whether paid for by cash, check, or charge. BUT !!
The credit card user may get "cash back", the bank's reward for using their card. Customers paying cash do not receive this reward, plus are saddled with the inconvenience of handling cash and coin.
- It's expensive for government to maintain "M1", money in circulation. It prints "paper" bills (details of what U.S. currency is printed on is secret) and mints coins. Plus it also redesigns printed bills to make them more difficult to counterfeit.
Thus government benefits from banks (NGO's) reducing the burden on physical M1.
The U.S. $dollar may be here to stay. But are U.S. cash and coin being marginalized, destined for near vestigial status? If so, what then?
And in the context of the credit card "cash back" process, this results is a defacto surcharge to those paying in cash. How will the law courts handle that one?
Is all this just a great big "nothing-burger"? Or is it the profile of something more consequential?
The credit card has insinuated itself into the U.S. economy not merely as a line of credit (spending money one doesn't have), but also as a medium of exchange.
Card reader technology is advancing to the stage where the credit card need not be "swiped" through a slot, so the magnetic strip can be read, an offshoot of tape recorder technology.
RFID enables the card-holder to merely tap the card on the reader to complete the transaction. And it doesn't end there. The smartphone can replace the plastic card entirely.
- The banks that offer these services, often free to the retail purchaser, derive their revenue by skimming a share of the retail profit from the sale. Reportedly there have been times the credit card company earns a larger profit from the sale of a gallon of gasoline than the "brick & mortar" gasoline station.
The retail products price is often the same whether paid for by cash, check, or charge. BUT !!
The credit card user may get "cash back", the bank's reward for using their card. Customers paying cash do not receive this reward, plus are saddled with the inconvenience of handling cash and coin.
- It's expensive for government to maintain "M1", money in circulation. It prints "paper" bills (details of what U.S. currency is printed on is secret) and mints coins. Plus it also redesigns printed bills to make them more difficult to counterfeit.
Thus government benefits from banks (NGO's) reducing the burden on physical M1.
The U.S. $dollar may be here to stay. But are U.S. cash and coin being marginalized, destined for near vestigial status? If so, what then?
And in the context of the credit card "cash back" process, this results is a defacto surcharge to those paying in cash. How will the law courts handle that one?
Is all this just a great big "nothing-burger"? Or is it the profile of something more consequential?