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Banks Preparing For The Oncoming Deflationary Depression?

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http://www.telegraph.co.uk/finance/finance...h-machines.html

The return of the fiver �€“ banks reintroducing £5 notes to cash machines

The fiver is making a return to the country's cash machines to help people manage their budgets during the recession.

By Chris Irvine

Published: 7:00AM BST 20 Aug 2009

The return of the fiver ? banks reintroducing £5 notes to cash machines

The Payments Council, the organisation responsible for ensuring payments systems and services work, says that while the majority of people still prefer to get £10 and £20 notes from cash machines, they are increasingly being given the £5 option

High street banks including Barclays and HSBC are stocking £5 notes at cash machines in lower income areas as well as university and college sites where they believe demand will be higher. They focus on areas where customers tend to withdraw £10 to £20 per visit, as opposed to the national average which is more than £60.

The Payments Council, the organisation responsible for ensuring payments systems and services work, says that while the majority of people still prefer to get £10 and £20 notes from cash machines, they are increasingly being given the £5 option.

Sandra Quinn, the council's director of communications, said that banks had been putting no-charge cash machines in lower income areas in the last few years and these machines tended to include fivers.

"These cash machines will be the ones where people take out the least money," she said. "They'll be taking out £10 or £20. If you're taking out £100 you don't want £5 from your cash machine, but if you're taking out £20, you might want a tenner and two fivers.

"The recession may well be playing a part. They might find the lower denominations a better way of managing their money."

A spokesman for Barclays said that two thirds of their on-site cash machines dispense £5 notes, while a handful of remote sites, mostly university campuses, stock them.

"We do take into account the local social demographic," she said. "It tends to be more in the North because people tend to have less money and there is a social inclusion factor as well. A handful of our remote sites tend to dispense them too. They tend to be university locations."

Inflation has meant that £5 notes have become increasingly uncommon at cash points in the last decade. Ron Delnevo, Managing Director of Bank Machine, who introduced £5-only cash machines last year, says Britain is "increasingly becoming a £20 note society", something he believes "causes problems for retailers and banks alike".

"For the consumer, having fivers in your wallet means less time at sales tills and less fiddly loose change," he said.

He added that a new machine, introduced at London Waterloo, was "particularly important given the economic situation, with many people turning away from plastic cards and back to cash in an attempt to manage their finances properly."

HSBC said they started trialing the stocking of fivers last month in the South-West and the Midlands, as part of a joint initiative with The Bank of England and other banks to "improve the quality of the notes". Mervyn King, governor of the Bank of England, has previously described many £5 notes looking "noticeably soiled and scruffy".

Edited by getdoon_weebobby

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Excellent. It all went wrong when they removed them.

You take care of a fiver and the change therein. You don't take care of tenners in quite the same way as the fiver becomes "change" and not a major denomination.

All a load of nonsense in the CGNAO world of hyperinflationary global holocaust though :lol:

We'll need £5000 notes if it comes to pass.

TFH

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Excellent. About time.

All a reflection of the increasing 'value' of money I reckon. Especially if swathes of job cuts ensue after the summer holidays.

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Preparing to limit withdrawals in the event of a general bank run?

Machines will hold less and be able to restrict high value withdrawals.

:ph34r:

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buying a house with fivers might mean wheelbarrow time, but other than that, i think that leaves wheelbarrows firmly in the 'garden implement' camp, and a long way from use as a wallet

(edited for spelling)

Edited by General Funk

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Real reason in the last para.

HSBC said they started trialing the stocking of fivers last month in the South-West and the Midlands, as part of a joint initiative with The Bank of England and other banks to "improve the quality of the notes". Mervyn King, governor of the Bank of England, has previously described many £5 notes looking "noticeably soiled and scruffy".

I can't work out why that bit is being underplayed though. It seems pretty harmless to me. Who wants a banknote that's falling to bits and smells?

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Does Zimbabwe have any coinage any more? :ph34r:

Mervyn King, governor of the Bank of England, has previously described many £5 notes looking "noticeably soiled and scruffy".

Very appropriate, following economic policy of the last decade.

Edited by OnlyMe

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Real reason in the last para.

I can't work out why that bit is being underplayed though. It seems pretty harmless to me. Who wants a banknote that's falling to bits and smells?

You believe what comes from the mouth of a bankster?

I'm shocked. :ph34r:

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I suspect that this is a recognition from high street banks that we are all going to become poorer for a while in both real and nominal terms.

Irrespective of the outcome of the inflation / deflation / biflation debate, we are all going to have less money in our accounts in the next two to seven years so it makes sense to have smaller denominations available in cash points.

In 5 to 10 years, we will either require £0.50 notes or £ 5,000 notes. No-one knows the outcome yet so it is probably a good idea to prepare yourselves for either outcome.

Scary times ......

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Preparing to limit withdrawals in the event of a general bank run?

Machines will hold less and be able to restrict high value withdrawals.

:ph34r:

spot on me thinks.

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I don't see what difference it makes really, 2x£5 or a tenner. All spends quickly enough.

A trueism for to-day.

In 10 years, a 50p note or a £5,000 note could buy the same as a £5 note to-day.

If I knew which one of the two alternatives would be true in 10 years' time, I could approach Warren Buffet levels of wealth.

Getting it wrong could result in current NW African levels of poverty.

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A trueism for to-day.

In 10 years, a 50p note or a £5,000 note could buy the same as a £5 note to-day.

If I knew which one of the two alternatives would be true in 10 years' time, I could approach Warren Buffet levels of wealth.

Getting it wrong could result in current NW African levels of poverty.

Deflation is a myth, we are more likely to see a £50 coin than a 50p note.

Edited by richyc

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Real reason in the last para.

I can't work out why that bit is being underplayed though. It seems pretty harmless to me. Who wants a banknote that's falling to bits and smells?

I remember seeing that Mervyn King in the sandwich shop outside the BOE with one of the aforementioned scruffy fivers. Not.

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For some strange reason I prefer having £5 notes over £10 or £20 notes. So welcome news for me.

I wil be happy to swap my fivers for your £20s. There is almost no limit to my generosity on this.

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Deflation is a myth, we are more likely to see a £50 coin than a 50p note.

On balance, I agree with you. I am just not yet ready to make a definitive bet that will impact my family over the next two generations or more.

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I'm quite pleased about this.

I once tried to get on a bus with a 20 quid note on the way to work, the only denomination the machine would give me. Conductor refused to take it, and stopped the bus when I refused to get off. P1ssed me off no end, as I needed to get to work on time to do a code release. The other passengers thought I was being unreasonable.

Quite often I used to find that shops would resent taking 20 pound notes, one guy even accused me of lying when I said I had nothing smaller.

Why do shops resent dealing in money? Don't they realise that people don't carry around cash tills with lots of denominations around? That's their frigging job.

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On balance, I agree with you. I am just not yet ready to make a definitive bet that will impact my family over the next two generations or more.

being wrong means your kids will have to do it on their own, maybe as you have. Being right means that you will be able to pass them something useful. There are few things that can be passed on of value that keep up with inflation and the taxman won't know about.

There is no doubt in my mind about inflation, I am now taking a longer term view, and planning as much for what I can pass on.

If you understand money, the history of money and how it works then there is no question of what to do. I don't pretend to understand a lot but know enough to place my bet.

What is it that stops you deciding either way? Am not being a smart ****, genuinely interested.

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I'm quite pleased about this.

I once tried to get on a bus with a 20 quid note on the way to work, the only denomination the machine would give me. Conductor refused to take it, and stopped the bus when I refused to get off. P1ssed me off no end, as I needed to get to work on time to do a code release. The other passengers thought I was being unreasonable.

Quite often I used to find that shops would resent taking 20 pound notes, one guy even accused me of lying when I said I had nothing smaller.

Why do shops resent dealing in money? Don't they realise that people don't carry around cash tills with lots of denominations around? That's their frigging job.

Shops don't like cash because they get charged to deposit it, never wondered why they all ask "cash back?". It is because recycling their cash saves them money. Quite a coup of the system really.

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