I LOVE the smell of money.

I am being 100% serious here. Have you ever held a brand new bill in your hand? Rubbing it between your thumb and forefinger and feeling the intricate texture on it? Taking in a deep breath of the intoxicating smell that is so much better than the new car smell?

My love for the feel and smell of brand new bills stemmed from all the wonderful memories during Chinese New Year and the money we were given inside those good-luck red envelops. It is important to use only GOOD CLEAN CRISP, preferably brand spanking new, bills in the red envelops. Every year right before Chinese New Year, the government would print out new notes in anticipation of people waiting in line at banks to exchange their old notes for NEW and CRISP bills. As I am typing this, I can remember seeing my dad coming home with a big fat envelop filled with the CRISP NEW bills he just exchanged from the bank,  and I can also vividly recall the feeling of rubbing a $NTD 1000 bill between my fingers and my heart starts a-fluttering. The smell of new money wafts in from nowhere. Kinetic memories FTW.

The first time I tried to celebrate Chinese New Year with my children here I walked in and asked to withdraw $100 in $1’s. The bank teller was not amused but she obliged. I stared at the pile of old and dirty dollar bills in dismay.

“Don’t you have NEW dollar bills?”

“Hm. No.”

“But it’s Chinese New Year!”

I was baffled by how she was baffled by all this.

Because of my childhood, I could understand when Mr. Monk first started receiving allowances, he asked for actual, physical money and not some “virtual money” registered in our family Quicken account the way his older brother does. Every Saturday, he goes to the family change jar and takes out 8 quarters ($1 for each grade you are in). He counts them. He rearranges them. He puts them in his wallet, takes them out again and then puts them all back in. He would beg me to walk to Walgreens across the street with him so he could buy something with his own, actual, money in all its physical glory.

The idea that money in the modern world, for the most part, is virtual not only sounds  ridiculous to him but seems to insult his intelligence.

“So you mean your money is just numbers inside your bank’s computer?!”

Nowadays, like many people, I do not carry a lot of cash nor do I pay with cash unless absolutely necessary. I use my credit card for everything and for any amount. Yes, I stopped feeling guilty a long time ago for using my VISA to pay for a small soda. Hey, I figure, at least I am not using my AmEx which would cost the retailer at least 2% more in processing fee. So I am actually being nice. But I miss being awed by the sight, smell and feel of crisp new bills which, in my experience, are extremely hard to come by in the U.S.

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Despite my nostalgia for the smell of crisp new bills and my persistent discomfort with the idea of virtual money (Think: Stocks. Think: Bernie Madoff. Think: Facebook valued at $50 Billion), I listened to a story on NPR, twice, of how a “magical” idea of virtual currency by four economists fixed the inflation problem in Brazil and saved the country. I was flabbergasted and can’t stop thinking about it since.

Long story short: Brazil suffered inflation since the 1950s when the government decided to print more money in order to fund the building of a new capital. They had not been able to get out of the vicious cycle and things got so bad in the 1980s that the inflation rate was 80% per month. Can you imagine that? Per month!

In 1992, the new minister of finance as well as the president asked for help from a group of four economists and what’s more, they promised the economists that the government would go along with whatever crazy idea they came up with and the economists would have total reign. The plan was not only to slow down the printing of money but more importantly, to change people’s behaviors and mentality. For the plan to work, the Brazilians needed to have faith in the stable value of the currency, after suffering years of crazy inflation rates. “People have to be tricked into thinking money will hold its value.”

What followed was nothing short of brilliant and fantastical, and the plan, however insane it may sound at first, actually made sense in theory and worked in real life.

The four economists wanted to create a new currency that was stable, dependable and trustworthy.  The only catch: This currency would not be real.  No coins, no bills.  It was fake. [It was] called it a Unit of Real Value — URV… It was virtual; it didn’t exist in fact.

People would still have and use the existing currency, the cruzeiro.  But everything would be listed in URVs, the fake currency.   Their wages would be listed in URVs.  Taxes were in URVs.  All prices were listed in URVs.  And URVs were kept stable. What changed was how many cruzeiros each URV was worth…  after a few months, [people] began to see that prices in URVs were stable. Once that happened, [the four economists] could declare that the virtual currency would become the country’s actual currency. It would be called the real. — NPR Abridged Transcript or Full-length Podcast

Imagine that: economists as national heroes. Virtual money that saved an entire country from inflating itself out of oblivion.

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Speaking of those who are in the business of money printing aka the Federal Reserve in the U.S., of course you know who Alexander Hamilton is. The dude on the $10 dollar bill. Yes! He who had the good fortune of being the first U.S. Secretary of the Treasury. But I did NOT know that he was born and grew up in the West Indies, an illegitimate child whose father abandoned them early on and whose mother died of a fever when he was 13.

Who’d have thought that Alexander Hamilton would make a great subject for Hip Hop and Rap and jam poetry? The Tony Award winner, Lin-Manuel Miranda did. Watch him do his Alexander Hamilton Mixtape at the White House. Really, history has never been so hip. Andrea, this one is especially for you, you High School teacher and Economics Geek you. 🙂

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