You can tell a lot about a Country by its money and how it is used. In the USA for example, you hardly every see real money. That country is basically a cashless society with everyone paying for everything by credit card, even a latte at Starbucks. It is changing a little with the severe economic situation currently but Americans still rely on debt to pay most of the bills. In Japan, cash is used for most basic purchases like a latte at Starbucks, a trip to the convenience store or an evening meal. Japanese really do not like debt very much. You do notice however, how clean the money is when you get it. Usually very crisp bills handed over to a customer at a retail store or Bank on a tray so the staff need not get their own hands dirty handling the cash. In Japan, it is really considered downright rude to handle money by hand especially in a commercial transaction with a customer.

Now in China things are a bit different. For one, the money is extremely dirty and torn when you get it. I mean really “dirty” and “torn up.” After a day of handling money in China your hands are definitely in need of a good washing with soap. Sometimes the money you get from taxi drivers is so dirty and torn up that you really need to spend time to carefully repair the bills before using them again. In fact if you get extremely clean money then you need to be extra careful because many times it will be counterfeit. It happened to me just last week in the small city of Zhuhai near Macau. I was in a hurry to get out of a taxi with a group of Japanese businessmen and did not seek to count the change which I am in the habit of doing. Sure enough the cleanest bill was a 10 Rmb counterfeit. When I told some Chinese friends later that night that I finally got a counterfeit bill, they all laughed and told me I was stupid for not checking each bill but even they were surprised to see that the criminal gangs were now going to far as to counterfeit even 10 Rmb notes.

What this all tell us of course it that China is very much a fast growing cash society with little time for the Central Bank to replace torn up dirty notes with fresh clean ones. In fact if the Government really did flood the country with clean bills it would definitely slow down commerce because all merchants would be on guard for counterfeits and would therefore be obliged to run all these bills through those machines everyone has to test for fakes. A second key point is that China is just so big and difficult to control that the Government really cannot stop all the fake notes in circulation no matter how hard they try. Third, we can visit cities like Shanghai or Beijing and feel that China is becoming so prosperous but for the average Mr. Wang on the street, 10 Rmb is a lot of money and he is careful how he spends it.

McDonald’s China recently lowered menu prices by as much as 30% in some cases and is aggressively promoting its 10 Rmb sets. You can now get a double cheeseburger and a medium coke for one bill or 10 Rmb all day every day. That is a pretty good deal for Mr. Wang since a bowl of noodles in a clean air conditioned restaurant costs about the same. And it is no secret that many restaurants try to price their menus around the most popular coins and bills to communicate value.

I recently tried to put my counterfeit 10 Rmb note back into circulation but the taxi driver, the noodle shop, the counterfeit DVD seller and even the McDonald’s counter staff said “no.” So I guess I am stuck with it and will frame the bill as a memory of my times in China.


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