Wednesday, June 24, 2009

Weird Japan to elimate cash to fight deflation!

So says the Times Online. Well, it isn't certain yet, but the journalist got some folks to (jokingly?) comment on the idea of eliminating cash in favor of electronic money to fight deflation.

With recovery elusive, a population doddering into old age and perhaps a decade of deflation in prospect, Japan may start mulling the most radical monetary policy of all — the abolition of cash.

Unorthodox, untried and, said one Bank of Tokyo Mitsubishi strategist, “in the realms of economic science fiction”....

Several MPs* in the ruling Liberal Democratic Party believe the abolition of cash, though politically radioactive, might be technically feasible...

In theory, many Japanese could easily make the leap into a cashless world...

...the country remains a wholeheartedly cash-based consumer society. TimesOnline. (All emphasis added.)

That must be some good dope that the Asia Business Correspondent is smoking. What are the odds of any of this actually happening? What are the odds that any of it will be seriously considered in the near future?

1225PM: It [The BOJ] is unlikely... to brook anything as radical as abolishing cash. (From the same report.)

There is a point to the story somewhere.

4:10PM Originally linked to via the NYT freakonomics blog. "In Japan where the future comes early..."

*Well, that changes everything. A few unidentified politicians believe something may be technically feasible which means.......what?

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