How to make your $$$$ lose value — randomly

Imagine that the Fed were to announce that, a year from today, it would pick a digit from zero to 9 out of a hat. All currency with a serial number ending in that digit would no longer be legal tender. Suddenly, the expected return to holding currency would become negative 10 percent.

This, was the suggestion put forward in 2009 by the economist N. Gregory Mankiw, chairman of the Council of Economic Advisers under President George W. Bush, to overcome the ‘problem’ that the dollar/pound/euro in your pocket could not be taxed when inflation falls below zero.

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