Beware any push by the banks to control all cash

THIS evening’s news (6.11.19) predicted the end of cash. People in the finance industry are saying how wonderful that will be.

My understanding is that the nation makes a profit from creating cash but makes substantial losses on the issue of plastic money.

When the Reserve Bank sees a need to increase the cash supply (for ATMs and so on), it pays a specialist minter or printer cost of production plus their profit margin, so the bank may pay 50c for a $100 note.

This cash is then sold on to the banks at face value (so they pay $100 to acquire a $100 note), which is called seigniorage and is obviously very profitable to the Reserve Bank. The amounts are small, amounting to 2% of money in circulation.

The remaining (98%) in the economy is your plastic card money, which gets into the economy only as a result of loans advanced mainly to mortgagees and includes interest from the loans.

They also make a profit on providing the eftpos machines to the retailers.

I have been told that the customer pays 1.6% surcharge on all bills, including cash purchases, which are therefore subsidising eftpos sales.

Beware of any attempts of the banks to get a money monopoly.

Dennis Dorney

Calton Hill

World Cup coverage

NOW that the Rugby World Cup has finally done its dash, I would like to know if TVNZ will give the same coverage rights to the Fifa World Cup when it comes around again.

Bill Swift

Dalmore

[TVNZ corporate communications general manager Rachel Howard replies:

‘‘Unfortunately, TVNZ does not have the rights for the Fifa World Cup. We are committed to showing more sport freetoair, and while football is with other broadcasters at the moment, we have the America’s Cup and select T20 and Super Smash cricket matches (men’s and women’s) coming up from 2020.’’] ......................................

BIBLE READING: For once you were darkness but now you are light in the Lord. — Ephesians 5.8.