A record number of $50 bills were printed last year. That’s not why you think

A record number of $50 bills were printed last year.  That’s not why you think

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United States fifty dollar ($50) bills seen on display in 2020.

New York

Unless you’re a coin collector, an employee of the Bureau of Engraving and Printing, or work for the Federal Reserve, you probably didn’t know that a record number of $50 bills were printed last year.

Last year, the government printed 756,096,000 of those notes — the highest total of denominations printed in a single year in more than 40 years. If you add all those 50s together, you have about $37.8 billion. That’s enough to provide Yum Brands, Inc., Taco Bell’s parent company, with a market cap of $35.3 billion.

The $50 bill is typically uncommon, and somewhat unpopular. There are even many superstitions that it is unlucky. (More about that later.) In 2019, only 3.5% of all banknotes printed in the United States were worth $50. In 2022, that rises to 8.5%, according to the BEP.

So why are you seeing more $50s? Surprisingly, it has nothing to do with inflation – even if it sometimes seems these days that an item that used to cost $20 now costs $50. (Fortunately, inflation growth slowed to 3.2% in October after peaking at 9.1% last June.)

Instead, it all started with the pandemic. The Fed discovered that people were starting to hoard cash. It is easier to get rid of large bills.

and Cedeno/Keck USA/AP

Marriner S. Eccles Federal Reserve Building on May 14, 2023 in Washington, DC.

In July 2021, the Fed noted that “2022 printing demand is severely impacted by the COVID-19 pandemic…and the Fed continues to face unprecedented currency demand.”

A subsequent report from the Federal Reserve Bank of San Francisco confirmed that after 2020, Americans began carrying more cash in their wallets, cars, homes and elsewhere.

Therefore, the Fed ordered a significant increase in the value of the fifty dollars. Until the pandemic, the $50 bill was one of the rarest bills that had been in demand for years, with the exception of the $2 bill. But for 2021 and 2022, the Fed has requested more than $50 of the $10 and $5 bills.

To understand why so many $50 bills were printed, it is important to know how the money printing system works. The Fed does not print any physical money itself; It estimates the expected demand for currency and the rate of decay of banknotes actually in circulation. It then requests money from the Bureau of Engraving and Printing, the government agency that prints paper money. The United States Mint produces coins.

Few people really like the $50. There is an old myth that because President Ulysses S. Grant is about to receive $50, and, famously bankrupt, the bills are a jinx. (The $50 bill dates from 1862, but Grant’s face was not added until 1914.)

Back in 2010, North Carolina Republican Representative Patrick McHenry attempted to introduce a measure to Congress to replace the 18th President Grant with the 40th President Ronald Reagan. These efforts received some support, but ultimately achieved no results.

Professional gamblers and casinos reportedly don’t like carrying bills, considering it a jinx, partly due to rumors that Las Vegas casino investor and gangster Bugsy Siegel died with only $50 in his pocket.

But, more likely, and more realistically, people tend to avoid using $50 bills due to confusion with $5 or $20 bills, and many stores do not accept bills larger than $20.

White House

Ulysses S. Grant, 18th President of the United States from 1869 to 1877.

The sudden surge in demand for physical money amid the lockdown may not make sense at first glance. Especially since with the emergence of the Coronavirus, businesses across the United States have temporarily closed their customer-facing storefronts and the Centers for Disease Control and Prevention Discourage the use of cash.

But demand for physical cash and actually paying in cash are two separate things, according to analysts at the Federal Reserve Bank of San Francisco. The researchers concluded that economic and geopolitical uncertainty naturally causes unease, leading many people to hold on to money they may not immediately try to spend.

Their data also shows that Americans are using cash less for everyday purchases, and that the amount held by consumers is still high compared to before the pandemic.

Printing different denominations It has returned to normal levels this year, as shown in the Fed’s 2023 and 2024 print orders. The main driver now in currency orders is the need to replace damaged bills (50-dollar bills last 12.2 years on average, according to the Fed; dollar bills last about half), the Fed said in its 2023 order.

The Fed placed its 2024 currency order in July, with an expected volume of $50 bills in the range of 99,200,000 to 211,200,000 notes, less than a third of 2022 printing.

But the cash holdings of American households They remain high compared to pre-pandemic times, the San Francisco Fed report showed, noting that consumers “continue to hold a significant amount of cash that may be less likely to be used for everyday purchases.”

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