Where Benjamin Franklin rules!

As Plastic Reigns, the Treasury Slows Its Printing Presses

Excerpt:

For two decades, since the fall of the Soviet Union, demand has exploded for the $100 bill, which is hoarded like gold in unstable places. Last year Treasury printed more $100 bills than dollar bills for the first time. There are now more than seven billion pictures of Benjamin Franklin in circulation — and the Federal Reserve’s best guess is that two-thirds are held by foreigners. American soldiers searching one of Saddam Hussein’s palaces in 2003 found about $650 million in fresh $100 bills.

This is very profitable for the United States. Currency is printed by the Treasury and issued by the Federal Reserve. The central bank pays the Treasury for the cost of production — about 10 cents a note — then exchanges the notes at face value for securities that pay interest. The more money it issues, the more interest it earns. And each year the Fed returns to the Treasury a windfall called a seigniorage payment, which last year exceeded $20 billion.

To meet foreign demand, the Fed has licensed banks to operate currency distribution warehouses in London, Frankfurt, Singapore and other financial centers.

In March, largely because of the boom in $100 notes, the value of all American notes in circulation topped $1 trillion for the first time.

Comment: NYTimes graphic: Denominations in Decline

A couple of times a year I might have a $ 50 bill. My dear neighbor to the North (a widow woman) gives me a $ 50 twice a year (I mow her grass and plow her driveway). I can't think of the last time I've seen a $100 ... I think years. No ... I got a $ 100 this year from the bank and gave it to my niece as a wedding gift. My demonination of choice is the $ 20. Every couple of weeks we get $ 80 out of the ATM and divide it up for petty cash.

I would like to see the penny and the dollar bill eliminated.