Why Not Encourage Folks to Take Out Travelers' Checques?greenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
From: Y2K, ` la Carte by Dancr near Monterey, California
I know this wouldn't be a solution for those who want to be sure to have removed every last cent and have it already invested in useful gadgets and supplies, but for those last minute types who merely want to have several weeks of cash on hand until they FOF the electricity...
Shouldn't banks be recommending that they buy Travelers' Checques now? Just a few weeks worth, may be their line. Your mileage may vary. They should tell people to go ahead and get them now, to avoid the rush. Travelers Checques are accepted most everywhere, same as cash. With multiple endorsements, they could even serve as a substitute for cash for a while, in case problems lasted longer than anticipated. Or at least that could be the party line.
Having a nation full of homes with a few thousand dollars in Travelers' Checques would discourage gunpoint home robberies. Victims could show their stash of Checques, and even sign some over, if necessary, but both would know that the checks could be canceled if the victim manages somehow to contact the bank.
I'm thinking that this would give the banks some more flexibility regarding their reserve requirements. Of course, they do have to have cash on hand to back up your Travelers' Checques, but perhaps not 100% of it. Perhaps some lenience could be legislated in that regard.
In case of a drawn out catastrophe, these pieces of paper would soon lose their worth, but then again, so would greenbacks.
I plan on having some on hand as my explanation for why I don't have any money for people to steal. I usually have a few of them on hand anyway, in case I suddenly need to have a lot of cash on hand.
-- Dancr (email@example.com), August 25, 1999
No matter how you cut it, a checque by any other name is still a check -- a promise to pay. Don't get me wrong, better a Traveler's Check than a personal check (or a stock certificate!), but if you are looking to hedge your bets for absolute nearly guaranteed (at least initially) money in the event of Y2K problems, you simply will not do better than greenbacks and coins. No muss, no fuss.
The idea of keeping some Travelers Checks so that you can point to them if you are ever robbed, is certainly a good one. Of course, being able to point the business end of a 12 gauge shotgun at said robber is even better.
-- Jack (firstname.lastname@example.org), August 25, 1999.
Traveler's Cheques rely on an operating banking system in order for them to be accepted; they are not the same as cash, though they're much closer than other electronic investments. The safest way to protect your wealth from Y2K is to convert it into cash now while the opportunity still exists. Hide the cash somewhere close at hand (this is not difficult) and wait until next March. If things haven't gone to hell by then, it should be OK to reinvest the cash in stocks, bonds, money market funds or whatever.
If the economy has collapsed by then, or if it's in the process of doing so, then your cash will have enormous value. Think about it. People need things in order to live and they've always used money to get these things. In a major collapse there will be nothing else other than cash that can be used to facilitate trades, so this is what people will use.
In a hyper-deflationary collapse, which is what Y2K may well bring, a house that is currently worth $250,000 may be worth $25,000. If you have $100,000 in cash stashed away, you can buy (if you want to) such a house outright and still have $75,000 left. That $75,000 may have the buying power of $750,000 in today's money.
The only prudent and cautious response to Y2K banking concerns is to withdraw your money from the electronic system, sell stocks and bonds, close money market funds, cash in annuities, close out savings and checking accounts and sit on the sidelines until the smoke clears. Any other approach is foolhardy given what is known about Y2K.
-- cody varian (email@example.com), August 25, 1999.
Traveler's checks still have to be reedemed in cash at the end of the day. Granted, you have paid the cash up front. so if the recipient's bank can get it from your bank, fine.
If you use them to buy stuff, people give you cash as change. If they don't have it, well.............
-- Forrest Covington (firstname.lastname@example.org), August 25, 1999.
Nobody's getting my Charmin with a check. Shiny metals only please...
-- Gia (email@example.com), August 26, 1999.
Right Gia, LOL. We know how those traveler's cheques will eventually get used.
As an aside, I see a similar problem when people decide to close their banking account or at least withdraw a large portion of their money......The banks will simply issue a cashier check. It will be their policy, that any money over 1000 that is withdrawn will be issued as a cashier's check.
-- BB (firstname.lastname@example.org), August 26, 1999.
you have to have cash and CHANGE in order to use a check right? well one of the issues may be 1) there is no cash left, and 2) there may be big bills only because they only "printed" big bills (there are no coins and no small denominations). so if there was food and if there was electricity and if someone was working and if the mcdonalds were open--you would pay $50 for a millenium happy meal.
-- tt (email@example.com), August 26, 1999.
Traveller's checks are not as easy to cash as they used to. Before, all you had to do was countersign in front of the merchant when paying for something. Now, they want ID in addition. If system goes belly up, will the merchant have confidence in either the check or the ID?
Besides, as mentioned above, you will need to receive back some cash or coin change, depleting his supply of cash/coin for the trav check. Now, both are essentially worthless (and you may have an opportunity to experience that), but arguing with the merchant isn't gonna get you anywhere.
-- A (A@AisA.com), August 26, 1999.
Hold on folks. Certainly cash is king. However, the original premise was that you use Travelers checks in lieu of leaving it in the bank. Some people don't wish to take it all out for whatever reason. In the event of partial bank troubles, having your money in Travelers checks and then redepositing it when the dust settles a little is not that nutty. That way you don't have to worry about which bank is compliant. The risk: what if Travelers Group (or whatever fiscal organization we're talking about) falls apart.
-- Dave (firstname.lastname@example.org), August 26, 1999.
Use USPS Money Orders. Buy at any post office. You must pay cash. Denominations up to $700. There is space for your name and the name of the person who'll cash the MO (at any post office), but you can leave both blank, so the MO can be treated like a bank note and passed from person to person. They are good for 6mos from date of issue. The big drawback is that you have no protection if they are lost or stolen.
Aside: get a few rolls of dimes and quarters, $100 in ones, and so on as part of you cash stash. If you only have $20s you may find some purchases end up costing a LOT more than you anticipated: "I don't have change- but it for $20 or don't buy it."
-- Mr. Postal (US@P.S), August 26, 1999.
From: Y2K, ` la Carte by Dancr near Monterey, California
The big drawback is that you have no protection if they are lost or stolen.
The only advantage I can see for unsigned USPS checks over green cash is in case of an issuancce of a new currency. I wonder if these would be considered to be a part of the new currency.
-- Dancr (email@example.com), August 27, 1999.
Note that purchasers of several U.S. Postal Service money orders in large amounts are subject to scrutiny for potential "money laundering abuses." More and more post office branches are converting to the new computer issued (and tracked) versions of money orders (MO).
The old style had original and carbon copies, and you got one copy as a receipt, along with the original. They were hand cranked out, not computerized. The new ones are printed out on a special printer from data entered into a fancy console, with way too many keys just to enter the amount to be printed on the MO. I assume that one of the keys is labelled "Suspicious." When the MO is cashed, they then have the person cashing the MO, as well as you, through them.
Remember, as with the picture ID and rent/utility receipts requirements to verify your actual physical residence to use P.O. Boxes or Private Mail Boxes, "Big Brother is Watching You." ("1984" by George Orwell).
-- A (A@AisA.com), August 27, 1999.