Sunday, August 20, 2017

Swedish Monetary Dicks

As you may know, the government of India recently took a large portion of its currency out of circulation. Now Sweden is doing something similar, albeit on a smaller scale:

About 1.6 billion kroner (converted $ 200 million) will soon be worthless in Sweden. The rally is a recall of the Swedish National Bank Riksbank, who wants to modernize their coins and make them smaller, lighter and more nimble, Bloomberg reports . The bank estimates that 30-50 per cent of the originally 2.6 billion crowns of outstanding coins are returned.

A spokeswoman for the Riksbank told Deutsche Wirtschaftsnachrichten that the coinholders have the option to pay the coins on their bank accounts, or to donate the sum to organizations that are working for children in need. The coins can also be handed over to the organizations so that they can hand over the money to the banks and then profit from their business accounts. The coins can not be exchanged at the central bank, according to the spokeswoman.

A press release from Riksbank states that citizens will be able to change 1, 2 and 5 crown coins by 31 August, so that the amounts are credited to their accounts. At present, 863 million coins are circulating to 1-crown coins, four million to 2-crown coins, and 151 million to 5-crown coins. After 31 August the coins will be worthless.

You can read the rest @ [translation required]

I don't see the rationale for this, as already-issued coins should not impose future expenses on the Swedish treasury.

As in India, this seems more an authoritarian exercise than a monetary imperative.

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