[quote=“Schnitte, post:80, topic:720569”]
Just to ask for clarification to get your point: Are you suggesting the dollar should (analogous to a reverse stock split) be consolidated so that 10 old dollars become a new dollar, and the old dollar becomes a new dime? I don’t quite get the supposed benefit of this. You seem to suggest that this move will eventually be inevitable, but I have two problems with this argument:
[ul]
[li]There’s no need for it. Suppose inflation continues at a rate of, on average, 2 % per year. So what? It would mean that a hundred years from now, what is now a dollar in terms of purchasing power would be $7.20. What would be the advantage of calling that sum $0.72, as it would be called under your scheme, rather than $7.20, as it would in the absence of your reform? It’s just a figure, after all.[/li][li]To reach the objective of your scheme in the long run, it would require periodic readjustments to keep up with inflation. Say one reverse split every 50 or 100 years. Is that really worth it?[/li][li][/ul][/li][/QUOTE]
When the dollar is 1/7th what it is now, the penny will be 1/7th what it is now and the dime will be 1/7th what it is now. The penny is already useless, as the thread has agreed. At 1/7th value, the dime will be pretty close to what the penny is currently worth and subsequently useless. Realistically speaking, cents as a whole would be pretty darn near useless by this point, so you might as well just abandon cents entirely and call it $7 rather than $7.00, since the two zeros would be there in the price of everything and, basically, just amount to wasted space.
There’s nothing wrong with getting rid of the cent entirely. In Japan, as mentioned, they only have the yen. There is no partial yen bill nor coin. Their “dollar” is 100 yen.
But 200 years past that, the smallest reasonable denomination will be $10. That will be equivalent to something like a quarter. 400 years from now, the smallest reasonable denomination will be $100. Every price will end with a couple of useless zeros or be filled in with some useless digits that no one really cares about, except the miserliest scrooge, that are just taking up space.
The thing is, we’re currently at the 200 year mark and we really have no intent of getting rid of cents, as a concept. Yes, we can be lazy or say, “Oh, well it’s not a problem for centuries.” But why say that? Why not just deal with the problem? Inflation ain’t stopping. 600 years from now, 800 years from now, 1000 years from now, and continuing on, the lower digits of the currency will become useless. Are we going to write out our prices with a set of 6 trailing zeros for everything? No, we’re going to slide the decimal point to the left because anything else would be stupid.
Every 200 years, like mowing the lawn, we’re going to have to adjust how we write and talk about our money (yes, like a stock split). Because of the delineation between dollars and cents, for another ~200 years we can be lazy and just accept the loss of the cent as a concept. If that’s what we want, then sure, I have no complaint. But I don’t actually see anyone advocating that. I only see people advocating kicking the can down the road, because “hard”.
If people want to retain the concept of “dollars” and “cents” then now is the time to act. By the time this becomes an issue again, when the $1 becomes worth something like the value of a dime, the clear decision will be to kill off cents and to make the dollar the smallest unit of money. Again, there’s nothing inherently wrong with that, but 200 years after that we’re going to slide the decimal point to the left. 200 years later, we’re going to slide the decimal point to the left. 200 years after that, we’re going to slide the decimal point to the left. For the rest of time, after the death of cents, we’re going to be adjusting the position of the decimal point. There’s no reason not to get into the habit now unless we really don’t like having dollars and cents.
