March 14, 2014

Horse 1636 - Why Is There No Love For The Two Dollar Note... in America?

This is a question which as someone who doesn't live in America I don't understand; yet if we ask people on internet fora who do live in America, their answers are just as equally vague. 

- Just look at Mr Jefferson's sad sad puppy-dog eyes. He knows you don't love him

Australia (after it got rid of 1c and 2c coins) has:
- 5c, 10c, 20c, 50c, $1 and $2 in coin 
- $5, $10, $20, $50 and $100 in notes

The UK (if you disregard 1p and 2p coins) has 
- 5p, 10p, 20p, 50p, £1 and £2 in coin 
- £5, £10, £20, £50 in notes

But the United States (after they finally eliminate the penny) will have:
- 5c, 10c, 25c, 50c and $1 (which no one likes)
- $1, $2, $5, $10, $20, $50 and $100 in notes (though notes bigger than $100 have done).

Apart from the fact that as a traveller in the United States, I found small change somewhat jarring because it makes more logical sense to me that an amount like 30c should be 20c + 10c and not 25c + 5c, or that 45c should be 20c + 20c + 5c and not 25c + 10c+ 10c et cetera, I never understood why shopkeepers look at you blankly when you hand over a $2 note. 

Even if you look at the Two Dollar Note, it screams how American it is. I very much like the fact that American currency yells its mythos so loudly. If we look at the Australian Twenty Dollar Note for instance, it has John Flynn who was the founder of the Royal Flying Doctor Service (sort of). Now I have to admit, that I needed to look that up. However, I can tell you that Washington is on the $1, Jefferson the $2, Lincoln the $5, Hamilton the $10, Jackson the $20, Grant the $50 and Benjamin the $100.
Given the very existence of the $20, there's not really a good reason why the $2 is so unloved.

- How 'Murican is this? They can't hear you over the sound of their 'Freedom'

I wondered if anyone had written on this sort of subject before and in passing I found this short piece by Yutaka Nishiyama* at the Osaka University of Economics, entitled "Why ¥2000 Notes Are Unpopular"; from 2013 (link: http://www.osaka-ue.ac.jp/zemi/nishiyama/math2010/2000notes.pdf)

Nishiyama suggests that in Japan, there is a cultural tendency to suggest that odd numbers are "complete"; citing the 5-7-5 syllable structure of Haiku and 5-7-5-7-7 of Tanka poetry. This is different to European culture where odd numbered things are seen as odd. The word "impair" which means to damage in English, has a direct homonym in French which simply means "not even".

Japan has: 
- ¥1, ¥5, ¥10, ¥50, ¥100 and ¥500 in coin 
- ¥1000, ¥2000, ¥5000, ¥10,000 in notes

This leads us to a very interesting point here. The ¥2000 note was only introduced in the year 2000, to commemorate both the G8 Summit and the millennium. This would tend to suggest that it might be 'newness' which makes it unpopular. Does this apply to the American $2 note though? Not really.
The American $2 note was first issued in 1862 and apart from a ten year gap from 1966-1976 when they weren't issued, they've been used for more than 150 years; that hardly supports that theory.

The only reason that I can think of then (and it is a very big reason indeed) as to why the American $2 note is unloved and unpopular is that... the American $2 note is unloved and unpopular. That might be something of a tautology but it's worth examining a much broader question of just what money itself is in the first place.

Money after its all said and done is nothing really more than a measure the value of goods and services. When a supermarket states that Carrots are $2/kg it not only tells us that kilo of carrots is worth $2 but also that $2 is worth a kilo of carrots. Physical currency is little more than a token of the worth of stuff or services performed.
Even in the old days when money was backed by gold, that fact was still the same. Although gold is shiny, malleable and can be made into pretty jewellery and be put to electronics-type of uses, it is still intrinsically pointless. There's no good reason for instance why bronze or steel could have been used, or even platinum or palladium or conch shells or anything.
Ultimately every currency is backed by "good faith"; in fact the word "fiduciary" which is often used to describe floating currencies not backed by gold derives from the Latin word "fīduciarius" which means held in trust.

I think that the only real reason as to why is there no love for the Two Dollar Note in America, is down to suspicion and mistrust of it. The obvious answer to counter that would be to release more of them into circulation, so that people see more of them.
Then again as I've already said in Horse 1400, the argument for not getting rid of the One Dollar note is probably also only down to suspicion and mistrust, despite there being a decent economic argument for changing to a $1 coin; actually, that argument probably also works for changing to a $2 coin too.

Or better yet... issue a $3 coin. It's happened before...



*Mr Nishiyama's work is fun to read: http://plus.maths.org/content/os/issue38/features/nishiyama/index

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