Posted by: scribe9 | November 5, 2009

Money matters

Today our New Zealand bank informed us that our application for a Visa card had been held up. Why? We’re here on one-year visas (the government-issued kind, not plastic), and the bankers are worried that we might leave the country owing them money. What can we do to get a Visa card? Simply deposit the amount of money we want as our credit limit in a certificate of deposit for the year. When I recall my dealings with bankers in the misty past, I realize that I shouldn’t have been surprised. As a bank’s lawyer once informed me during complex mortgage negotiations, “We’re the bank and we get first dibs on everything.” Not always, and they don’t usually use that terminology, but that’s their goal.

My New Zealand banker also informed me that down here virtually no one writes checks, except possibly to the plumber or the lawn guy; virtually all payments are done in cash or electronically. Then I learned that on the few instances when checks are written, they are to be crossed—one draws vertical lines through them—and then they can only be deposited into the account of the payee, not cashed or endorsed to a third party. It turns out that that’s common in Great Britain and many other countries in the Commonwealth (but not Canada, where checks are cheques).

In the United States, checks are virtually always negotiable. There are certain requirements one must meet, all set out in Article 3 of the Uniform Commercial Code, which I have studied and you needn’t, to make an instrument negotiable. Famously, one can write a valid check on the side of a cow (or, I suppose any other animal that will hold still for the writing and then allow you to deliver it to the payee who can then take it to the bank), or in frosting on a cake, or with paint on a shirt. Of course, the bank may balk at cashing it, and these days many banks won’t take third-party checks because they’re worried that the person who wrote the check may not have funds to pay it, but that’s not because the check isn’t technically negotiable.

In New Zealand cash, the copper coins the size of an American penny aren’t pennies—they’re ten-cent pieces. (There are also twenty- and fifty-cent pieces which are silver-colored, and one- and two-dollar coins which are gold-colored. Yes, New Zealanders have faced the fact that one-cent and five-cent pieces weren’t worth the trouble of minting or handling, and one- and two-dollar bills get worn out too fast.) Lots of prices still have a digit other than zero in the cents column—merchants still want you to think that $7.99 is substantially cheaper than $8.00—but if you pay in cash, the final digit will be rounded up or down. If you pay by credit card, it won’t—there are still plenty of virtual one-cent and five-cent pieces out there in the ether. The real coins aren’t dimes or fifths or half-dollars—maybe people here just aren’t fond enough of their metal money (or their bills) to give them nicknames.

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Responses

  1. Marian just sent me your blog site. This is great. It is going to be so educational for all of us. Thanks for doing this.


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