Can't get $2s

On Wed, Padraic Brown wrote:

Um. HELLO? I just proposed a broad based survey to research this
issue! I specified those segments that handle cash regularly and in
great quantity; but have also suggested including the "common spender"
in the past.

I am having trouble finding facts that agree with what I see
in the quantity of cents and the dates of dollar bills.
There are definitely enough cents in circulation, it
is time for the FRB to suggest that banks try to find a way
to recirculate cent surpluses amongst themselves.

I see no reason at all for a bank to stock $2 bills unless
a race track is a customer, or enough merchants want them
to use in making change, to warrant stocking the minimum
shipment.

But the bigger issue is how much truth there is in the
numbers of dollar bills printed in direct replacement of
destroyed bills.
I could support dollar coins more forcefully if I
were to see good evidence that it actually costs a lot
more to use dollar bills than dollar coins (I do not think
the present alloy sandwich faces are what will keep the
SAC looking good for 30 years).

What I have done on a small scale is to check dates
of dollar bills that I have, and it turns out that 10 out of 12
were 1999 series bills (this was from 12 bills I received
from the same source, change for a $20 bill).

For a bill to only last 18 months there should only
be about 2 or 3 out of ten older than 2001 series, as the
published numbers for dollar bills in circulation are just
passing 8 Billion.

And it would be helpful to know how many bills
are still actually in circulation, there are a number of
cases where dollar bills are used that dollar coins would
never be used, and many ways that dollar bills will be
lost forever (but probably not collected to the extent
that coins are).
Many merchants place the first dollar bill received
in a frame with their business license, so that could
account for several million bills.


Tracking the dates of worn bills being destroyed
does not tell the average lifetime, but a survey of the
dates of bills in circulation should as long as the survey
is not of direct bank withdrawals that may contain all
new bills.

And somthing that might sway my opinion and
whether I care or not is knowing who benefits from
the bills that are lost or placed where they will never
be redeemed.
This is important even for dollar bills, but more
important for larger denomination bills, if government
costs or profit is the driving issue, then the governemt
must be the entity to lose or gain from any changes.

If it turns out the FRB pays for all printing and
keeps all issued bills listed as possibly redeemable,
then the government would not even be involved
in the issue, and all support for doing away with
dollar bills is misguided.

It is certain that many millions, if not Billions,
of bills of all denominations will never be redeemed,
and whomever it is that benefits from that fact can
apply the gain from lost bills to the printing costs.

The government seems to definitely receive
the "profit" from the mint, but the "profit" from
printing bills can vary according to how the bookkeeping
is done, either it shows up in excess revenues of the FRB,
or just stays on the books as a redeemable debit forever,
with possibly no benefit to any entity ever realized in
a way that shows up on the books.

As it is, claims that the government would gain
by the use of dollar coins instead of bills are suspect,
I have been assuming the treasury received the benefit
of lost bills, but now I am not sure.
And if the treasury does not receive the "profit"
from printing paper money, then the government does
not pay for the printing, and it seems to be a non-issue
in either case.

Joe Fischer