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Let's Play Hot Potato
March 24, 2008

Tom Snyder in Waukesha, Wis., gets the credit for being the first person to report to me his receipt of one of the new $5 Federal Reserve Notes.

As he reports by e-mail, "It was spent by the customer ahead of me at McDonalds and the clerk was having a problem accepting it when the guy told her it was a new one. I, the next customer, agreed and so she accepted the note, but quickly paid it back out to me in my change."

This raises the usual questions about the lack of awareness of many of Americans of their money. Fortunately for the clerk's peace of mind, she could treat the new bill like a hot potato and quickly pass it to Tom, who could report it to me and the rest of the collecting community.

That got me thinking along historical channels about the economy. During the Depression of the 1930s there were many unorthodox thoughts about how to get the economy moving again.

One method was to spend into circulation pieces of paper that weren't money but passed as money. The technical term is scrip. The kicker, though, was this scrip expired, so the point was to spend it as quickly as possible. It was thought that these quick expenditures would help jump start demand much like the recently enacted stimulus package that will be paid out in May.

This was before John Maynard Keynes formalized the Keynesian economic theory of demand management through public expenditure to keep economies going.

Perhaps we can get the rest of the public to treat the new notes like hot potatoes and spend them more quickly.

No? Well, that's the best I can do on a Monday morning this week.

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About the Author
David C. Harper has been a coin collector since 1963. He joined the Krause Publications editorial staff in 1978 and is currently editor of Numismatic News and World Coin News. He also edits two books annually, North American Coins & Prices and Coin Digest. He is the author of the Class of '63 column that runs each week in Numismatic News. His first bylined numismatic article appeared in the June 1971 issue of Coins Magazine and his various Krause Publications assignments included a stint as editor of the magazine 1980-1983. Harper received a bachelor of science degree from the University of Wisconsin-Oshkosh in 1977. He had a double major of journalism and economics.

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