Has "electronic money" made us lose sight of value?

ntg said:
The rate changes every few minutes as they follow the market rate plus some %.

So will the rate Mastercard give you. The rate on Mastercard's site is a daily indicative rate. If the rate plunges at noon Mastercard won't give you the morning rate if you happened to check their website in the morning. Mastercard will also 'round' their rate, meaning that they'll clip you a bit on the conversion.
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Yes, I'm fully aware that exchange rates change and they change much more frequently than every few minutes.
The fact of the matter is the site you posted has a much larger spread than the Mastercard rates and gives you a worse deal.

You have the option of fixing your rate up front by drawing cash out, or being exposed the currency risk by using whatever the spot rate is when you use your card, but I'll wager than the average consumer isn't in a position to decide on which way will give them a better deal so they should use the option with smaller spreads.
 
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I remember when I bought my laptop with cash a few years ago, £640 didn't sound too bad, I had budgeted for it, and I had done extensive research into the model, I planned to keep it for a number of years (and I did) and was all set to go, until I held £640 in a mixture of 20's and 10's in my hand. It took me another week to get my head around the idea of spending that much money then.

Same again when I bought my car.

Seeing £1400 laid out on the desk in mostly 20's with a few 50's made it seem like a horrific amount of money, even though a £1400 car is a dirt cheap car, and I needed a car.
 
Haircut said:
Yes, I'm fully aware that exchange rates change and they change much more frequently than every few minutes.
The fact of the matter is the site you posted has a much larger spread than the Mastercard rates and gives you a worse deal.

You have the option of fixing your rate up front by drawing cash out, or being exposed the currency risk by using whatever the spot rate is when you use your card, but I'll wager than the average consumer isn't in a position to decide on which way will give them a better deal so they should use the option with smaller spreads.
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Oh I agree, I don't think there is a material difference between the rate Mastercard offers and any other option at the moment, given that their rate is so low.

EDIT: Btw, about the FX rates changing per minute I meant the ones quoted on the webpage of the shop

The mastercard site has the following statement:
"The displayed rates are derived from the buy and sell rates included in the MasterCard daily rate setting process and do not include any charges or markups applied by the Issuer. "

who is the issuer here? the credit card issuer? halifax clarity points to the mastercard index site with regard to their rate, so does that mean they don't apply markups? hmmm
 
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ntg said:
What? what are you own about?

The Bank of England is under the authority of the Treasury and is an independent public institution.

The Fed is independent and receives its authority by the US constitution and it is subject to congressions supervision.

ohhh i get it, you're trolling..ok.
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The Fed is a private bank....about as federal as Federal Express
 
acme15 said:
I remember when I bought my laptop with cash a few years ago, £640 didn't sound too bad, I had budgeted for it, and I had done extensive research into the model, I planned to keep it for a number of years (and I did) and was all set to go, until I held £640 in a mixture of 20's and 10's in my hand. It took me another week to get my head around the idea of spending that much money then.

Same again when I bought my car.

Seeing £1400 laid out on the desk in mostly 20's with a few 50's made it seem like a horrific amount of money, even though a £1400 car is a dirt cheap car, and I needed a car.
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That's pretty much where I'm at. Using cards and DD and paypal and the like has almost made me forget how much money is worth if you have it in a physical paper form, you "think" it's more valuable.
 
If people still had to take a big portion of their take home pay from an envelope they received each week from the finance office at their employers, then pay that in as their mortgage payment at their local bank branch, houses would be priced at a quarter or less of what they are now.

We are so abstracted from reality and risk now-a-days - just how the spivs and corporations want us.

When the spinning plates all come crashing down it will take generations to adjust.


subbytna said:
I went to get some holiday cash changed and had 2.5k GBP cash in my hand and I thought to myself, that's a Titan Z wad of money there, but actually having that amount of physical paper money in my hand somehow made the amount seem to be "more" that it was actually worth...in my head anyway.

Yes we all know £100 is £100 but when it's on a screen, or £2500 on a screen, but does it really register properly just how much cash that is?...unless you have a thick wad of notes worth that amount, in your hand.

Transferring the 2.5k via online banking I didn't really think too much about it but then having the same 2.5k wad of notes in my hand made me think that perhaps, with electronic money use, are we losing sight of just how much money is worth in your head comparing electronic cash values with actual paper wads of cash.

Might be a bit of a mish mash of a post and perhaps I'm not getting my point across properly but for me anyway, it boils down to having the actual paper amount of the money made it seem "more valuable" to me than when I did the cash transfer electronically....even though it was the same amount of money.

Are we now blasé with money due to using electronics to control it?
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ntg said:
who is the issuer here? the credit card issuer? halifax clarity points to the mastercard index site with regard to their rate, so does that mean they don't apply markups? hmmm
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yes

and its better value than getting from a some specialist FX shop in that case... looking at your link the spreads are tighter with the mastercard rate
 
BunnyKillBot said:
Recall that the bank of england, and the USA's federal reserve are private banking institutions, not state machines. Their names are a deliberate con to imply they are more public than they actually are.
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LOL - 'private banking institutions' of course they are 'state machines' - the idea that there is some deliberate con revolving around ownership is pure conspiracy theory nonsense

The Bank of England is not a private banking institutions and is very much as state institution, it wasn't when it started out but that is irrelevant today - its owned by the Treasury Solicitor on behalf of the Govt - the Bank of England's Governor is appointed by the Queen.

The Fed causes some confusion (and sparks the usual CT nonsense) as members are said to be stock holders. No one actually owns the Fed, member banks holding stock is more symbolic - the system was set up by an act of Congress - various banks are said to 'own' stock in their local Federal Reserve bank but this is part of their requirement to join the system. They were not paid interest on the reserves they are required to deposit(until a few years ago) but as partial compensation recieved dividends as a result of the stock they are said to own. They get to vote on the local directors however the board of Govenors, the Chair etc.. are appointed by the US President. Its very much a state machine and it is quite deliberately (and rather sensibly) kept fairly independent from both the executive and legislative branches of govt.
 
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Completely agree. I remember my dad having a deposit in cash for a house (around 90k) which was just insane.

He buys all cars in cash as well, which always piques my curiosity.


Certainly I find it easier to spend on chip and pin, but I'm still pretty grounded.

My room consists of a bed and table, laptop, and a wardrobe with a few clothes. I'm not a very materialistic person. :p
 
sports_brah said:
He buys all cars in cash as well, which always piques my curiosity.
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Mine too - dealers generally refuse to accept cash unless the car is lower value. think they might even be legally prevented from doing so. You need to use a debit card to pay cash for a car really unless its sub £10k.
 
I find electronic money, paypal, online banking, debit cards brilliant. Hardly ever use cash these days.

My spending habits have changed quite a bit. I'm able to spend a lot more than I used to. I've been spending money like crazy over the years. I'm always checking the banks website and I have tons of money left, in fact it seems to be going up not down!!!

Have to change my web browser soon though as I think I've got some kind of HTML formatting bug or something. There's this annoying - sign in front of the numbers.
 
dowie said:
LOL - 'private banking institutions' of course they are 'state machines' - the idea that there is some deliberate con revolving around ownership ,...
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Ill just park this here


Oh and
http://www.bankofengland.co.uk/about/Pages/default.aspx

The Bank of England’s purpose today reflects that vision first articulated by our founders. Our mission: to promote the good of the people of the United Kingdom by maintaining monetary and financial stability.

Originally established as a privately-owned institution, the Bank of England was nationalised after the Second World War, but retained its broad – but largely informal – public service mission.

This changed in 1997, when Parliament voted to give the Bank operational independence with a clear remit to pursue price stability, which had been the most significant challenge facing macroeconomic policymaking for the previous two decades.

However, the financial crisis demonstrated the need for a new approach to financial regulation in the UK. This has resulted in a major expansion in the Bank’s responsibilities, which came into force in April 2013.

In some respects, this represents a return to the broader role that the Bank exercised in the past. However, while the Bank’s commitment to serving the public good would be recognisable to its seventeenth century founders, its responsibilities are now clearly defined by Parliament.
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Founded privately with a non-elected 'public service mission', publically owned after the war, and now back to being operationally independent. You scratch my back, I'll scratch yours ;)
 
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BunnyKillBot said:
Ill just park this here

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And I'll again accuse you of posting retarded conspiracy theory nonsense...

http://rationalwiki.org/wiki/The_American_Dream_(film)

The American Dream is a 2011 animated film produced and written by Tad Lumpkin and Harold Uhl. At first glance, the movie seems to explain rather accurately what concepts such as money and debt mean, while being complete arse at explaining how the Federal Reserve and fractional reserve banking work. At around half way through the film however, it deteriorates into a vast conspiracy theory, claiming, among other things, that the Rothschild family (called "Red-Shields" in the film) are controlling the Federal Reserve and that they were responsible for the Assassination of JFK.
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BunnyKillBot said:
Founded privately with a non-elected 'public service mission', publically owned after the war, and now back to being operationally independent. You scratch my back, I'll scratch yours ;)
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The BBC is also operationally independent... its not a sinister plot - the MPC sets our interest rates rather than leaving them in control of the chancellor as was the situation prior to 97.
 
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