Money and a Crap Book

I'm delighted and saddened at once to realise that I'm at a level of readership that allows me to read half a book, turn to the nearest person and say: 'This, this book is crap. Not only is it crap, but it's wrong.'  And so it was with a book that I was actually quite excited to get my hands on.

David Wolman is a contributing editor at WIRED, just about the only magazine I read. He also writes for the New Yorker and the New Scientist, just about the only other two magazines that I've ever read. I squealed giddily (in my head) at his slightly polemic-y article on a universal currency and was highly compelled by the original article from a few years ago that spurred this book: The End of Money

Wolman's hypothesis is simple: we don't need physical money. In fact, not only do we not need it, but it's bad for us, the economy and the planet.

He dwells early on with the argument about germs and cash being handed around. I'm immediately mentally countering with the idea that we probably have infinitely more physical public contact in other arenas - public transport, bars and clubs... hospitals. I'm hoping that this isn't the basis of the entire book. 

He puts that argument aside for the first few chapters. If you don't know much about the history of money - what it is, and more importantly what it actually means then there's some succinct and valuable information here. But this information is punctuated by poor proof-reading and editing. For example, he mentions 25p pieces twice - whatever they are - and keeps referring to 'The Covent Gardens.'  He's American, and I have a first printing so I decide to let it slide. 

US' new $100 bill video - check out the music.

The next chapter delves into the murky world of counterfeiting and the technology involved. Again, there's some absolutely fascinating hard fact and great stories in here: The existence of the supernote phenomena that plagues the US economy - apparently an economic attack by North Korea to weaken the dollar by introducing super high-quality $100 bill forgeries forced the US Mint to redesign it for the first time in a hundred years or so.  The questions of who owns the paper money, the tax breaks it grants and its use by criminals and foreign governments is examined - apparently a third of US paper resides in the vaults of dictators. 

Then it starts to get really interesting. We delve into the psychology of cash, the studies that show how illogically we value it above electronic money. How the physicality gives it a sense of worth and enshrines a reluctance to spend it. Here lies the crux of the argument for the economy; not only is paper money expensive to make and control but we don't like spending it. We count out pennies and cherish twenties but wouldn't think twice about buying a book for £19.99 on Amazon through Paypal.

What's missing with electronic money, Wolman argues, is the sense of value that  goes into the design of paper money - the legacy and power of cash. His solution? We need to design interfaces that evoke feelings of value when transacting. And this is where I stopped and turned to the person nearest to me. 

Who is this 'we' that would design interfaces to make us think twice about instantaneously and effortlessly paying for a meal and a healthy tip? What profit-minded credit card company, bank or transfer service would pay for or endorse software that would make transacting slower and more thoughtful? The easier we can spend and the more disconnected we are from that process, the more money they make. I can easily imagine some sort of iPhone app coming out of a garage somewhere that sends out reminders when we spend over a certain amount a day. But to make transacting electronically like using cash, you essentially


Bernie Madoff used complex ponzi schemes and false electronic reports to cheat investors out of $36 billion. Michael Anthony Fuller tried to break a fake $1 million note in Walmart.

Let's be logical here. He states that about 1% of cash is counterfeit. Wolman himself points out how well-buffered and insulated the markets are against these forgeries. If you get a counterfeit £20 note, the chances are you won't even know. They're so good that you can take into a shop, spend it and never see it again. Eventually it makes it's way to a central bank, they find it, test it, tell shops to look out for it and then it's over. The only way you lose is if you spot it, take it to a bank and hand it over in exchange for a hearty 'thanks mate.'

The physicality of cash makes it difficult to counterfeit in colossal amounts anyway and easy to trace. I admire a couple of kids who can print out a passable £100,000 in fivers more than, for instance, Vodafone, Philip Green, Amazon or Google who use intractable and complex methods enabled by electronic banking to hide inconceivably gargantuan amounts of money from the public purse. And what about the Bernie Madoff's of the world who use similar means to criminally cheat the world out of billions, cause a collapse of confidence in the markets and eventually, the trebling of university fees?

I could go on. The whole thing is riddled with theoretical failings and flat-out wrong monetary theory. He appears to have made his mind up before he started based on the simple idea that cash is for nostalgic patriotic idiots and everyone else is behind him on this one.  Save your pennies and don't read it.