One of the good features of cash is the fact that it can be used anonymously. It's no surprise that the government hates that, but would you ever expect the government to actually outlaw the use of cash? Down in Louisiana, a recently passed law completely outlaws the use of cash in transactions for secondhand goods. When I read the story, I thought it was so crazy that it had to be a misunderstanding. I looked up the bill, and the original version of the bill actually does not have this clause. Instead, it requires that anyone selling secondhand goods make a detailed recording of any cash transaction. But somewhere along the way, that bill was amended, and the final version (embedded below) does, in fact, appear to ban cash transactions:

A secondhand dealer shall not enter into any cash transactions in payment for the purchase of junk or used or secondhand property. Payment shall be made in the form of check, electronic transfers, or money order issued to the seller of the junk or used or secondhand property and made payable to the name and address of the seller. All payments made by check, electronic transfers, or money order shall be reported separately in the daily reports required by R.S. 37:1866.

I do wonder if that's even legal. Our cash clearly says that "This note is legal tender for all debts, public and private." While businesses may have the right to refuse cash, can a government outlaw the use of cash? That seems pretty extreme.

The state representative behind the bill, Rickey Hardy, seems to think it's no big deal, admitting that this is purely to make life easier for law enforcement in response to criminals who steal stuff and then sell it off:

"It's a mechanism to be used so the police department has something to go on and have a lead," explains Hardy.

You can understand why law enforcement wants that, but just because law enforcement wants details of your private transactions, it doesn't mean you should be blocked from using cash. And people wonder why there was so much interest in Bitcoin (even if Bitcoin itself is rather flawed).

It seems that there's a fun, but stupid, game that the press has picked up on in this whole debt ceiling debate (egged on by some in the government) that, thanks to the debt ceiling, Apple has more cash than the US government. As we get closer to the debt ceiling cut off, other mile markers are being highlighted as well, including the claim that Bill Gates has more money than the US government.

This is wrong. And it is stupid. Please stop repeating it.

The US government can print cash. It does not run out of cash. The numbers being talked about concerning the debt ceiling represent an artificial limit, set by the government, on how much the US can borrow (debt) in order to finance its operations (set in a budget by the federal government itself). What the Apple comparison treats as government "cash" is just the difference between what the government is (artificially) permitted to borrow and what it has borrowed already.

None of this has anything to do with how much cash the government has on hand. Comparing the distance to the debt ceiling with the amount of cash anyone has is comparing two totally different things, and while it sounds nice, it's a silly political ploy and it makes you look silly. A more accurate comparison would be of something like how much money I have in my wallet right now to how much money Bill Gates' arbitrarily promised his wife he would take out of the bank this year. The comparison is totally meaningless and stupid. Please stop making it.

There's a lot of money in the world, but the vast majority of it is not cash. Digital bits accounting for vast sums are the intangible fabric of our economy now. Still, people like to use cash -- and here are some interesting articles on physical currency.

• Printing US currency is getting greener -- using renewable energy and recycled textile fibers. Money doesn't grow on trees, but it does grow on cotton plants. [url]
• A billion dollars in unused $1 coins is sitting around in a vault, honoring past presidents..? Come on. At least let people throw them into a well and make a wish, folks. [url]
• The use of cash is in decline, as more and more people pay with plastic. The US Treasury didn't print any $10 bills last year?! [url]
• Canada has taken the "pay with plastic" phrase literally as it introduces plastic bills. Actually, other countries have had plastic bills for a while... [url]
• Dutch coins are being minted with QR codes on them. And the QR code reveals an online game? [url]
• To discover more stuff on economics, check out what's currently floating around the StumbleUpon universe. [url]  

As always, StumbleUpon can also recommend some good Techdirt articles, too.

In our recent post about musician Joe Pug and other artists looking to get away from ridiculous service fees on tickets, commenter berick pointed out that Bob Dylan has come up with an interesting strategy to not just get around service fees, but scalpers as well: no pre-bought tickets to the show, just pay cash at the door:

When Bob Dylan says his just-announced, surprise show at the Warfield in San Francisco next Wednesday, August 25 costs $60, he means it costs $60 -- no service charges. No scalpers. No secondary market. In fact, perhaps as an effort to combat all complaints about the ticketing industry at large, there simply won't be any advance tickets to the show. Fans will pay $60 -- cash only -- on their way inside the venue, and that's that.

Of course, the downside to this is that if too many people show up (a decent possibility) you might not get in at all... Still, it's interesting to see how musicians are trying to get around activities that are seen as anti-consumer when it comes to pricing live shows.

In one of my posts about the financial crisis, I noted two important things: that if banks really did stop lending money, there would be opportunities for others to start lending (though, the question was whether or not widespread fear would stop that process) and that non-bank businesses might start adjusting their own "loans" in the form of changing the terms on deals. Of course, what we were talking about there was businesses decreasing the amount of credit they offer customers by doing things like shrinking the terms on a deal from payable at net 60 days to net 30 days.

What we didn't necessarily count on was that cash rich tech companies might go in the other direction -- and look to fill that opportunity to lend where banks had failed. Apparently vendor financing is suddenly a very hot business, with various tech companies suddenly finding a lot more interest in their leasing and vendor financing programs. Effectively, what's happening is that these tech firms with money are taking over the role of lenders from the banks. Assuming the loan risks are low, this could actually work out quite well for these tech companies in the long run. It's at least something worth watching. Valleywag worries that these sorts of deals almost always end badly -- but that's not necessarily true. It really depends on how the programs are run, and how well they measure the risk associated with certain companies.

With reports of huge numbers of iPhones being purchased to be unlocked and resold, it looks like Apple trying to clamp down a bit on the process by changing the rules for purchasers: requiring credit cards for purchases and limiting order to only 2 iPhones at a time. This is similar to what the original "launch day" limitations were. The credit cards let Apple track purchases more carefully (though, you have to wonder what good that really does) and the two person limit makes life harder for unlocker/resellers -- but also makes it more likely that parents will be able to pick up iPhones for their kids this holiday season. As for whether or not it's legal to turn down someone handing over the requisite amount of cash, we'll just let the US Treasury Department explain that it's perfectly fine. The whole "legal tender" bit doesn't mean anyone has to accept your cash.

A bigger question, though, is why Apple would bother? The resellers are likely to figure out ways around these limitations anyway, and it just seems more likely to cause problems for legitimate purchasers (especially younger ones who might not have a credit card yet). And, while it is true that Apple makes money from every iPhone with AT&T service, it's silly to completely shut off unlockers, who still are giving Apple plenty of money that they might not hand over if they were forced to go with AT&T service (especially those from foreign countries where iPhone service is not offered). This really seems like an unnecessary restriction that isn't likely to help Apple very much.