Once upon a time I was one of a group of young turks asked to advise the central bank of a newly independent country on a cost effective model for the ordering of new bank notes.
It was fascinating to learn so much about the system for producing, storing, handling, managing & paying for those bits of paper which, as long as we have some in our purse or wallet, we take so much for granted, but in the end we were unable to come up with a suitable model – not one which was capable of yielding solutions with the methods available to those without the kind of modern computer resources of which we could not even dream, or outperform the abilities of the experienced bankers who had been dealing with these issues for a lifetime (not that there were so many of them in a world which had so many fewer nations & currencies).
Not that these problems are necessarily any easier to solve in the world which is blessed with such a choice of mathematical models & computing power as is available to the modern central banker.
I was chatting with the young man in the bank about the surprising difference the ready availability of £5 notes is making. As shoppers or bus passengers we are not constantly asked Haven’t you got anything less? & those who serve us are not having constantly to respond by handing over of a handful of £1 coins with an apologetic or surly ‘We haven’t got any fivers’
He had noticed that – but then he said that, funnily enough, they weren’t seeing nearly so many £10 notes these days – not that there was any shortage, they just hardly ever see any new ones.
I am still trying to work out whether that means that the Bank of England is concentrating on producing new £5s at the expense of £10s, or whether the useful life expectancy of a £10 has increased so that, until the system again comes into equilibrium the old ones just do not need to be replaced.
Bit like human population really – the birth rate goes down when the death rate goes down.
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