18 May 2011

Y Me?

Or, what are the chances of that?
I've just come back from Euroland (Holland): instead of converting euros back to pounds I decided to hold onto them with a view to spending them at a later date.

Nothing unusual in that, except I began to think about the Greek debt crisis. As we should all be aware the single currency isn't really a single currency: each of the nation states of Euroland still has a central bank and it is these central banks that issue their allocated proportion of notes. If the central bank cannot support its currency then - theoretically - that part of the currency will collapse forcing it out of the euro. In order to trace the issuing bank each of the notes has a letter at the beginning of its serial number.

The country code for Greece is Y.

So, what are the chances of getting a €10 note?

Notes in circulation and notes issued by Greek Central Bank
DateTotal€500€200€100€50€20€10€5Notes
Mar 20118242883615326952197ECB in billions. 1
Mar 201122,058-----508.6-Greek Central Bank millions. 2

Notes: 1, total value used (table 2). 2 the proportions of notes in circulation were not available from the Greek Central Bank; the same proportion for the rest of europe was used.

We can now work out what percentage of €10 notes in circulation originate from the Greek central bank.

100*(508.6/19000) = 3 %

I had a three percent chance of getting a single Greek €10 yet I get two (a nine in ten thousand chance). Stats is a tricky business but I'm suspicious that there is a hugely disproportionate number of Greek euros in circulation with other notes being hoarded.

(I don't know how bank accounts work with respect to allocation of risk: perhaps every euro bank account is subject to the same proportionate risk, perhaps not? Watch this space.)

Is this the beginning of the fracture of the single currency? When are you going to stop taking them in your change? I'm going to try and palm those off onto someone else and I'm going to avoid taking Greek denominated euros when I can. How about you?

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