There is a fascinating few paragraphs on the amazing (and largely unknown) story of the six-month bank strike that took place in Ireland in 1970, which quickly took a great deal of cash out of circulation. The few paragraphs are part of a longer article on bitcoin, which I'm not so keen on, but you can check it out here: https://cointelegraph.com/news/do-we-even-need-banks-ireland-didnt-for-most-of-1970
In any case, I've copied and pasted the bit about how people in Ireland coped with no banks for six months, below.
Quote:
Irish banking strike
In 1970 all banks in Ireland closed during a strike lasting six and a half months, which at the time was predicted to have a similar catastrophic forecast to that which occurred in Greece.
This strike began on the May 1 and lasted until Nov. 17, 1970.
The facts are contrary to what was expected and it had very little impact on the Irish people. Instead of panicking, the people of Ireland used their survival instinct and very rapidly discovered other ways for carrying out the functions previously performed by the banking industry.
Economist Michael Fogarty, who wrote the official report on the bank dispute, was quoted by the Irish Independent as saying that: “the services of the clearing banks proved by no means as indispensable as would have been expected before the dispute.”
Others take the example of the Irish bank strike as evidence that much of what banks do is a “socially useless activity.”
Undated cheques often endorsed over to others but never cashed, became a form of currency. When the supply of cheques dried up people wrote new ones on any available piece of paper, sometimes adding a postage stamp to give it an official appearance. There were even stories of cheques being written on toilet paper and beer mats.
Ireland had a population of 3 mln at the time and their 11,000 pubs and 12,000 shops became the substitutes for the banks.
The system worked because it was based on local knowledge and trust. Those who were exchanging checks and IOUs knew each other well.
Antoin E Murphy, who carried out a study on the strike’s effect, found the public’s ability to assess risk “was based on a vast pool of information available to transactors on the credit-worthiness of other transactors.”
The accuracy of their judgment was demonstrated when the strike ended with most pieces of paper turning out to be worth the value that was written on them. There were few insolvencies, and overall, imports, which were expected to be badly hit, were largely unaffected.
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branchandroot
Re: Here Come "Programmable Dollars": New York Fed And 12 Banking Giants Launch Digital Dollar Test
Date: 2022-11-18 02:19 pm (UTC)In any case, I've copied and pasted the bit about how people in Ireland coped with no banks for six months, below.
Quote:
Irish banking strike
In 1970 all banks in Ireland closed during a strike lasting six and a half months, which at the time was predicted to have a similar catastrophic forecast to that which occurred in Greece.
This strike began on the May 1 and lasted until Nov. 17, 1970.
The facts are contrary to what was expected and it had very little impact on the Irish people. Instead of panicking, the people of Ireland used their survival instinct and very rapidly discovered other ways for carrying out the functions previously performed by the banking industry.
Economist Michael Fogarty, who wrote the official report on the bank dispute, was quoted by the Irish Independent as saying that: “the services of the clearing banks proved by no means as indispensable as would have been expected before the dispute.”
Others take the example of the Irish bank strike as evidence that much of what banks do is a “socially useless activity.”
Undated cheques often endorsed over to others but never cashed, became a form of currency. When the supply of cheques dried up people wrote new ones on any available piece of paper, sometimes adding a postage stamp to give it an official appearance. There were even stories of cheques being written on toilet paper and beer mats.
Ireland had a population of 3 mln at the time and their 11,000 pubs and 12,000 shops became the substitutes for the banks.
The system worked because it was based on local knowledge and trust. Those who were exchanging checks and IOUs knew each other well.
Antoin E Murphy, who carried out a study on the strike’s effect, found the public’s ability to assess risk “was based on a vast pool of information available to transactors on the credit-worthiness of other transactors.”
The accuracy of their judgment was demonstrated when the strike ended with most pieces of paper turning out to be worth the value that was written on them. There were few insolvencies, and overall, imports, which were expected to be badly hit, were largely unaffected.
End quote