Following the denial in February that this action is in any way about reducing cash, The ECB has made its decision on the EUR500 Bill:
- *ECB ENDS PRODUCTION AND ISSUANCE OF €500 BANKNOTE
- *ECB SAYS ISSUANCE OF EU500 NOTE TO STOP AROUND THE END OF 2018
- *ECB SAYS OTHER EURO BANKNOTES WILL STAY IN PLACE
- *ECB: EU500 CAN BE EXCHANGED AT CEN BANKS FOR UNLIMITED TIME
And just like that the second highest denominated European bank note in circulation (after the CHF1000 Bill) is dead...
And so now, everyone rushes into the CHF 1000 note.
So what, big deal, eliminate it. The people will still have 5, 10, 20, 50, 100 and 200 euro bills right.
As we wrote previously, the answer is not that simple at all. Recall that the €500 note is the second highest currency denomination in G10, after the CHF1,000 note. More importantly, the total value of €500 notes in circulation amounts to €306.8bn and has been rising as shown in this BofA chart:
Read more at http://www.zerohedge.com/news/2016-05-04/war-paper-currency-officially-begins-ecb-ends-productionissuance-eu500-bill