Pierpaolo Barbieri: prediction

Transcript context

…Why in those countries and not others? In the US, currency per capita is rising. That may be held abroad, but still, currency is far from disappearing. Absolutely. I think the dollar is very particular because a lot of emerging markets — people want to save in US dollars. As you mentioned earlier, I grew up in Argentina. Argentines hold an amazing amount of physical dollars because they don’t trust their banking system after the implosion of 2001. I think that it’ll remain a constitutional right to hold cash if you want. Cash is anonymous in a way that a lot of people value. But I think that there are societies in which you basically don’t need a card. When I’m in New York — I don’t remember the last time I used cash in New York City. I think a cashless society is driven by the fact that the regulators want to see a lot of transactions, as in China. But it also could be driven by the fact that from a convenience perspective, you can create a better credit history without having to deal with the difficulties inherent in cash, which is dirty, expensive for the state, hard to manage, easy to steal, hard to save on. I think that in places like Sweden or Denmark, cash is going away very quickly. The problem is that there are certain regions in the world — and that’s why I do what I do — where 50 percent of adults have been completely left outside of the system. They don’t have a way to transact because the banking system gave accounts to the people they wanted to give accounts to, and they left everyone [else] out, which is why those banking systems are so damn profitable. The Mexican banking system, which serves only 30 percent of the population, is amazingly profitable. It has much better margins than a European banking system or an American banking system because they just said, “Well, I’m going to serve this stratum of society and leave everyone [else] out.” And it’s almost cartelized, right?…

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