Finance & economics | Buttonwood

The appeal, and the flaws, of cash-based accounting

Earnings are fiction and cash is supposedly fact. But what is the truth?

EVERY NEW form of payment, from cheques to contactless cards, is heralded as the end of cash. Your friend, the one with the fat wad of banknotes, like an old-school bookmaker, knows different. Cash has unique attributes, he says. It leaves no trace so transactions stay private. It requires no fragile infrastructure to process payments. You can pay for groceries in a power cut or get a drink at the bar when the card machine fails. Cash is non-negotiable. It is why it is readily accepted.

This article appeared in the Finance & economics section of the print edition under the headline “The cash bug”

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From the February 22nd 2020 edition

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