Production of the $100 bill is up 100 percent since the collapse of the U.S. economy began in 2007 and is 50 percent more than the total number of $1 bills printed in the same time period. These numbers suggest that there is a healthy demand for $100 bills in both the regular economy and the shadow economy and the demand is still continuing to grow.
Colas explained that $100 bills are the preferred denomination among those in the underground economy’s illegal activities, such as the drug trade, illegal arms transactions and even tax evasion deals. He explained that since the U.S. dollar is in danger of losing its world reserve currency status, the statistics show that it’s sort of an endorsement by the underground entities.
Also, the increase in use of $100 bills could be because there have been delays of a newer version of the note, which has had technical difficulties and the newly printed currency has not yet been in circulation.
Meanwhile, when it comes to smaller denominations, the demand isn’t there. One of the reasons is that many consumers are turning to credit and debit cards to purchase items that are relatively cheaper. The innovation in credit technology has become transparent in recent years as a Visa card can simply tap a machine to purchase a $1.50 coffee or a $0.50 bottle of water. Read more....