Cash is Dead

lol

I know in parts of the World that cabbies take debit and/or credit cards but here in the UK offering payment that way will result in a hard stare. The handling fees for credit/debit cards here for a taxi are ridiculous, running at about 10% per transaction and because of the taxi licensing we're not allowed to charge more than metered fare. I'd rather run the risk of getting robbed once in a while than swallow a 10% loss on each and every transaction. Also, with cash the passenger will nearly always tip you to some degree.

Oh and never try to fiddle your tax. They know all the scams and tricks people try. Keep the tax man happy. What was the old phrase, keep your friends close and your enemies closer

 

should 5% appear too small,
be thankful i don't take it all.

 

...declare the pennies on your eyes....

 

Digressing again but it's amazing to think that with all our moaning over here about the temporary 50% tax rate being reduced to 45%, that in the 1960's when the Beetles wrote "TaxMan" income tax for high earners was, wait for it....95%!?!?

Wth

[ame=http://en.wikipedia.org/wiki/Taxman]Taxman - Wikipedia, the free encyclopedia[/ame]

 

Here in Australia, we have two systems that allow cabbies to accept credit/debit cards. Both systems charge a 10% handling fee that is added onto the cab fare so that the driver gets the amount shown on the meter, and the customer pays extra for the ability to use a card. Visa, at one stage, tried to stop this charge as being against their charter, so the Cabcharge system dropped Visa as an acceptable card. (Cabcharge was, at that time, the only provider of in-cab card processing.) This happened at the time of the Sydney Olympics and Visa ended up getting all sorts of bad press as they were the card to use for the Olympics, except in cabs. They have now accepted the Cabcharge system's 10% extra charge.

Cabcharge is also operating in Singapore with the same deal - a 10% add on fee for paying by card, and they have also got some cabbies in London operating on the system.

We have a number of toll roads here in Sydney, and all of these are cashless - you need to setup an account with one of three or four toll operators who provide an electronic tag that registers each time you go through a toll collection point. But recently, there has been a spate of "news" items where people have been fighting these toll operators for charges made against their accounts for tolls that they could not have made. A classic example was a person who was charged for using a Melbourne toll road while their car was in a locked garage in Brisbane (over 2,000 kms away) and the driver was overseas.

It just highlights the problems of going cashless - you really need to check those accounts that you are using for your cashless transactions, be it credit card/electonic payment system, and then be prepared to fight if you find an incorrect entry. The cost to you may be more than you think.

 

and after al people are on virtual cash then ( and this is already proposed in the EU ) every transaction you make and have to make online will be taxed.....
no in that case i am back on real touchable money

 

Gosh.. Johnny was dead almost 9 years now!

 

Grumpy, I've always wondered how does a cabby protect his cash in the UK? Here in the US at least in Atlanta most cabbies have a weapon in the cab.


iPad ?

 

Ah, I've learned something. In Maine, although retailers can't add a credit or debit card surcharge, they can discount based on method of payment. I think I might have to start asking. We have 1% cash back on our credit cards so if they give me a 1% discount for cash I'll take that instead.

If a company wants people to pay with debit or credit cards the Frank-Dodd bill now prohibits differential charging based on the card issuer and I believe that also effectively bands card issuers from preventing the merchant from offering cash discounts.

 

When the U.K. had that 95% tax rate, how much did you have to earn before that rate kicked in, and was it a marginal rate (charged only on the amount above a certain income) or was it charged on the whole income?

Personally, I'd see nothing wrong with a marginal rate of 95% on everything over, say, ten million. Nobody, IMHO, is really "worth" more than half a million a year. Especially in 1960's British pounds sterling, which would probably be worth about five million 2012 U.S. dollars.

Anyway, anybody know what the actual numbers were?

 

Trade secret

I just hope any mugger can run faster than my car!

Seriously though, it's such a rare event that it's not really a concern. I don't carry lots of cash, drop off notes when passing home and keep some to hand and most hidden so if I am robbed, they just get £20 in notes and £30 in coins. You also have to be careful with a passenger who starts asking how your night has been and what time you started, especially if they look a bit dodgy. I just tell them I started an hour ago and that it's been a slow shift. Never tell them you've been busy.

Just common sense.

 

I did have a pretty big wad of bills - I didn't buy my Prius from a Toyota dealership. It's an excellent negotiating chip to dangle the money in front of the sales guy.

I admit to having a non-mainstream view of economics, primarily stemming from my degree in it. Government deliberately stoking inflation to fire up spending is an extremely cynical and short-sighted method of stimulating the economy - and completely ineffective in the long run.

In the short term, governments cannot control where the money goes - so those of us that are saving out of fear or uncertainty will simply move their money elsewhere. That's why gold and other precious metal prices are so high. There's millions of gallons of oil simply sitting offshore in tankers, held by investors because they are a far better store of value than the Fed-controlled dollar.

And for those of us who can't move our money - either through lack of knowledge or lack of wherewithal - are simply screwed.

(Disclosure: I have about 20% invested in "alternative" stores of value.)


Here's a bit more on the problems of inflation:

 

High top rates came from a combination of three taxes:
- Income tax
- Surtax on income over a certain level, levied on top of income tax. Like AMT but "additional" instead of "Alternative".
- Investment income tax on unearned income.

Of course that was on income that wasn't protected by tax-protected reinvestment. In the 1970s there was a lot of investment in forests because forestry management was fully tax-deductible.

Taxation in the United Kingdom - Wikipedia, the free encyclopedia

HM Revenue & Customs: Taxation: Income tax today

Just like the USA, gradually the top rates of income tax have fallen. In the austerity some taxation has increased.

High-rate tax payers have never really paid that much in taxes since they would always take action to cut their paid taxes and keep their incomes. The effect of high taxes on the wealthy is more about government directing investment. It was the lessez-faire '80s that saw the current low rates.

 

In this USA we also have the issue that the number of people paying ZERO has also risen. Smaller base equals less money taken in. While the top rates have decreased we have also eliminated or limited the deductions.


iPad ?

 

i heard that in vegas, people using debit/credit were gambling twice as much money as people using cash.

 

Just telling him you'll write a check for the full amount has the same effect, without the questions regarding where the cash came from.

So because you have a degree in economics, you know better than 95% of the other people who also have degrees in it?

I specifically referred to a SMALL and CONSTANT rate of inflation. Just enough that people don't keep their savings in the mattress. Governments "deliberately" "stoking up" inflation is another matter entirely. As for more reasoned and rational adjustment of the money supply, there are always legitimate disagreements on the details, but relying on metals alone, without any regulation, has been disastrous in the past. We went off the gold standard because it just does not work in a large modern industrial economy.

That's fine. It's your choice. Some advisors feel that a smal portion of your portfolio in such things is a good hedge. I prefer to invest in things that pay interest or dividends, or, to a much lesser degree, companies that offer the promise of growth. But there's nothing wrong with holding alternative stores of value. The problem with unproductive investments like metals is that it's nothing but gambling on a market for a commodity that has no intrinsic worth, but only the price that people are willing to pay, because they think that others also will pay it.

Doesn't surprise me in the least. People use cards to spend money they can't afford or don't have. So sure, when they're gambling with cards, they'll gamble money they can't afford or don't have.

 

Hi daniel--

I'll try to address each reply as you've typed it.

I certainly believe I'm right - but I, like everyone else out there, am entitled to an opinion. And my research concluded some very different results than many mainstream economists.

In theory, that works great - and is a reasonable public policy goal, because stuffing money under the mattress isn't doing anyone much good. The problem is that government has an excessively poor track record of controlling the money supply. Every single fiat currency has failed in the history of the world. Every single time a government debased its currency in an attempt to pay its bills (see: Diocletian, the Spanish, the Germans, Zimbabwe) it resulted in economic chaos (and sometimes real chaos, as the Roman Empire collapsed and the Germans elected Hitler).

The problem with today's inflation statistics is that the Fed changed the definition of CPI in 1982 - ostensibly to have it more accurately reflect modern times, but they also removed food and fuel from the equation - and gave housing a 40% weight. Meaning, that while the housing market has gone bust, it's also completely masking the true inflation of food and fuel prices.

ShadowStats.com explains it much better than I can, though: Shadow Government Statistics : Home Page

To sum up, government simply can't be trusted to manage the money supply - and the United States government is no exception. Hence why there needs to be some form of hard currency to which the government is bound.

 

You make some very good points. The problem is that "hard" currencies have failed even worse than most modern "fiat" currencies. Yes, some bad governments have driven their currencies to nothing. But there are good reasons why the gold standard has been abandoned by every country in the world. And it's not because every government in the world is crooked and wants to screw their people with a "fiat" currency.

The gold standard was a failure. In part because a totally unregulated money supply causes boom and bust cycles that make our present economic fiasco seem like paradise by comparison, and in part because there is not enough gold in the world to mediate our modern industrial economy.

What's your suggestion to replace the present system?

Remember that nothing that's ever been used as money has any intrinsic value. Gold has some industrial uses, but mostly people just like it because it's pretty, and then they bid up the value on the raw speculation that maybe tomorrow someone else will pay more. It's high now, and some folks think it wil always be high (just as people before 2008 insisted that property values can only go up!!!). But if you're on the gold standard when the bubble bursts, you have an economic catastrophe. And if you try to hold the value of gold to a set exchange rate, you can't. But if you let it float you have no control at all over the value of money.

So, again, what's your alternative?

I think a moneyless society would be nice. "From each according to his ability; to each according to his needs." Problem is, that doesn't work either.

 

I hope so. Because in the hard sciences, like physics, the 1% (Newton, Einstein, Heisenberg, Dirac) that departed from the mainstream were the ones that were right, not the other 99%.

 

I dropped cash use years ago. It's just so much easier using the CC everywhere.