| I think that using cash makes money expensive which adds some base load inflation - this will help reduces homelessness and other societal ills (such as wealth inequality). Electronic money is never lost, not like those pounds, pennies, dollars, quarters. Losing money, takes out of circulation. While not much is taken out, it might be enough to create a base load of inflation - money becomes more scarce and therefore more expensive. Low inflation leads to asset price bubbles - stock market and housing in particular. It also suppresses wage inflation. So housing becomes more expensive and wages do not keep up, making housing less affordable. A double punch. Low inflation leads to more financial speculation as people with access to capital look to diversify away from a limited pool of assets (Bonds and cash become less desirable in low inflation regimes). Buying housing and leasing it out is a good use of capital. However, this leads real-estate investors to drive increases in rent as they chase yield and airbnb-empires also drive rental prices - as this is one way of driving yield. High rents combined with low wage growth means that people's lives become priced for perfection and one small deviation can knock them out of equilibrium - losing their home / rental property when they lose their job. All because governments and technology are conspiring to keep inflation low. Using cash is the person-on-the-street's only weapon to fight it. |