--- begin forwarded text From: "Michael Alexander" <mfa@alpha.univie.ac.at> To: <dcsb@ai.mit.edu> Subject: Re: DBS, Privacy, Money Laundering nonsense. Date: Sat, 14 Nov 1998 20:52:53 +0100 MIME-Version: 1.0 X-Priority: 3 X-MSMail-Priority: Normal X-MimeOLE: Produced By Microsoft MimeOLE V5.00.0810.800 Sender: bounce-dcsb@ai.mit.edu Precedence: bulk Reply-To: "Michael Alexander" <mfa@alpha.univie.ac.at>
From: "Black Unicorn" <unicorn@schloss.li> That's on the order of $600 trillion per year, just in SWIFT. (Add another $1.3 billion for CHIPS and $989 million for Fedwire daily. Oh, don't forget the foreign exchange
as a minor correction, SWIFT 's main service is to exchange payment messages to feed into e.g. Fedwire or CHIPS so that would be double counting
The payment system today eats up over 1.5% of the GNP primarily because of nonsense regulations like CTR's and other transaction reporting ... 1% of the GNP. Instant 1% growth for changing a system of clearing. Think about that for awhile.
slowly on that: payment systems costs represent what economists call 'specific taxes' that is they inflict deadweight losses on the economy. More efficient payment instruments such as some being based on bearer certificates would per se lower GDP but lead to higher demand in theory. Its effect would be as instant as a cut in other broad ones such as income or capital gains that is it involves lag. On the actual percentage of payment systems costs as % of GDP my estimates are way higher. By simply taking clearing float days of the major retail, business and interbank instruments, the figure is more like >2% with current (low) interest for the U.S. and even higher for Europe. This does not take into account that a more efficient payment system with a higher money velocity would lower the demand for transaction money among other effects. Michael For help on using this list (especially unsubscribing), send a message to "dcsb-request@ai.mit.edu" with one line of text: "help". --- end forwarded text ----------------- Robert A. Hettinga <mailto: rah@philodox.com> Philodox Financial Technology Evangelism <http://www.philodox.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'