WEBVTT 00:00:00.000 --> 00:00:05.280 Right now in Australia, there is over $33 billion 00:00:05.280 --> 00:00:09.140 worth of $100 notes just out there in circulation. 00:00:09.220 --> 00:00:11.640 Yeah, which is just a massive number. Right. 00:00:11.919 --> 00:00:14.240 Mathematically, they make up nearly half the 00:00:14.240 --> 00:00:17.079 physical cash wealth of the entire country. And 00:00:17.079 --> 00:00:19.820 yet, if you live there or if you visit, almost 00:00:19.820 --> 00:00:22.440 no one ever actually sees them. No, you really 00:00:22.440 --> 00:00:23.940 don't. You don't get them in your change of the 00:00:23.940 --> 00:00:26.199 grocery store. You don't see people handing them 00:00:26.199 --> 00:00:29.500 over for a coffee. Even ATMs rarely dispense 00:00:29.500 --> 00:00:32.240 them. They're practically invisible. It is a 00:00:32.240 --> 00:00:35.520 massive statistical paradox, really. You have 00:00:35.520 --> 00:00:38.280 this object that is undeniably central to the 00:00:38.280 --> 00:00:41.020 nation's wealth, I mean, produced in the hundreds 00:00:41.020 --> 00:00:44.320 of millions, yet it completely avoids daily transactional 00:00:44.320 --> 00:00:46.810 velocity. Yeah. Exactly. It's just hiding in 00:00:46.810 --> 00:00:49.590 plain sight, you know. Functioning way less is 00:00:49.590 --> 00:00:51.649 walking around money and more as well a shadow 00:00:51.649 --> 00:00:54.829 asset. And that brings us to today's deep dive. 00:00:54.990 --> 00:00:57.130 We are so glad you are here with us. Today we're 00:00:57.130 --> 00:00:59.469 unpacking a really fascinating Wikipedia article 00:00:59.469 --> 00:01:02.310 all about the Australian $100 note. It's a great 00:01:02.310 --> 00:01:04.989 topic. It really is. Reading through the source 00:01:04.989 --> 00:01:07.469 material completely shattered my understanding 00:01:07.469 --> 00:01:11.030 of what cash actually is. We're looking at a 00:01:11.030 --> 00:01:15.349 physical object that functions as this masterclass 00:01:15.349 --> 00:01:18.030 in anti -counterfeiting technology, a canvas 00:01:18.030 --> 00:01:20.650 for national identity, and bizarrely enough, 00:01:20.769 --> 00:01:23.030 the center of a massive controversy regarding 00:01:23.030 --> 00:01:26.569 the underground economy. So okay, let's untack 00:01:26.569 --> 00:01:29.049 this. Sounds good. And our mission today is to 00:01:29.049 --> 00:01:31.930 look beyond the monetary value with a note. We 00:01:31.930 --> 00:01:34.269 want to decode what the physical evolution of 00:01:34.269 --> 00:01:37.310 this specific banknote reveals about much larger 00:01:37.310 --> 00:01:40.469 macroeconomic forces. Right. By tracing its history, 00:01:40.549 --> 00:01:42.569 we are essentially reading a physical record 00:01:42.569 --> 00:01:44.950 of inflation, tracking an arms race and optical 00:01:44.950 --> 00:01:47.489 engineering, and observing a real -time debate 00:01:47.489 --> 00:01:49.650 about, you know, the future of society's financial 00:01:49.650 --> 00:01:51.950 privacy. Which is wild for a piece of plastic. 00:01:52.290 --> 00:01:55.489 But to truly appreciate the high -tech futuristic 00:01:55.489 --> 00:01:58.209 present of the Australian $100 note, we actually 00:01:58.209 --> 00:01:59.810 have to start with the fact that it was Well, 00:01:59.810 --> 00:02:01.609 it was entirely missing from the original line 00:02:01.609 --> 00:02:04.430 up. Yeah, it didn't even exist. Right. When Australia 00:02:04.430 --> 00:02:07.069 modernized its currency and rolled out its decimal 00:02:07.069 --> 00:02:10.169 system in 1966, you know, leaving behind the 00:02:10.169 --> 00:02:12.729 old pounds and shillings and pence, there was 00:02:12.729 --> 00:02:15.090 no one hundred dollar note. They released this 00:02:15.090 --> 00:02:17.590 full suite of new decimal notes for the modern 00:02:17.590 --> 00:02:19.990 era, but they stopped short of one hundred. Why 00:02:19.990 --> 00:02:24.360 is that? Well, in 1966, $100 represented just 00:02:24.360 --> 00:02:27.099 a massive amount of purchasing power. The average 00:02:27.099 --> 00:02:29.460 citizen simply didn't need to carry that kind 00:02:29.460 --> 00:02:31.719 of concentrated wealth for daily transactions. 00:02:32.280 --> 00:02:34.680 The physical notes available just matched the 00:02:34.680 --> 00:02:37.340 economic reality of the time. But economic realities 00:02:37.340 --> 00:02:39.919 don't stay frozen in time, right? Exactly. It 00:02:39.919 --> 00:02:43.439 wasn't until 18 years later in 1984 that the 00:02:43.439 --> 00:02:47.069 $100 note finally appeared. And the source material 00:02:47.069 --> 00:02:49.370 specifically points to inflation as the driving 00:02:49.370 --> 00:02:51.389 force there. Yep, inflation changes everything. 00:02:51.750 --> 00:02:54.430 Over almost two decades, the purchasing power 00:02:54.430 --> 00:02:57.009 of those existing denominations had shifted so 00:02:57.009 --> 00:02:59.270 drastically that carrying around large amounts 00:02:59.270 --> 00:03:02.069 of cash, you know, in smaller notes, had become 00:03:02.069 --> 00:03:05.050 highly impractical. And if we connect this to 00:03:05.050 --> 00:03:08.310 the bigger picture, physical currency acts as 00:03:08.310 --> 00:03:10.750 a historical receipt for those macroeconomic 00:03:10.750 --> 00:03:13.740 forces. The central bank doesn't just print larger 00:03:13.740 --> 00:03:15.740 denominations for fun. Right, they don't just 00:03:15.740 --> 00:03:18.199 wake up and say, let's make a bigger bill. No, 00:03:18.300 --> 00:03:20.439 they are forced to do so when the fundamental 00:03:20.439 --> 00:03:24.020 value of the currency changes. So the mere existence 00:03:24.020 --> 00:03:27.860 of that 1984 note is physical proof of the inflation 00:03:27.860 --> 00:03:30.759 that eroded the currency's value between 66 and 00:03:30.759 --> 00:03:32.719 84. You know, it makes me think of an analogy. 00:03:33.159 --> 00:03:36.520 Ah, let's hear it. So you know what a massive 00:03:36.520 --> 00:03:39.379 complex video game has released? The decimal 00:03:39.379 --> 00:03:42.300 system rollout in 1966 was kind of like the base 00:03:42.300 --> 00:03:43.919 game. It worked perfectly for the economy at 00:03:43.919 --> 00:03:46.939 launch. OK, I'm falling. But over 18 years, the 00:03:46.939 --> 00:03:49.939 in -game economy inflates. Suddenly, players 00:03:49.939 --> 00:03:52.479 are trying to buy high -value goods, but they're 00:03:52.479 --> 00:03:55.419 forced to carry around thousands of low -value 00:03:55.419 --> 00:03:58.259 gold coins. The inventory system just breaks 00:03:58.259 --> 00:04:00.319 down under the weight of it all. That's a really 00:04:00.319 --> 00:04:02.280 good way to put it. So the developers in this 00:04:02.280 --> 00:04:04.300 case, the Reserve Bank of Australia, are forced 00:04:04.300 --> 00:04:08.250 to issue a software patch. In 1984, they drop 00:04:08.250 --> 00:04:11.009 a brand new massive value item into the game 00:04:11.009 --> 00:04:14.009 environment just to stabilize the physical mechanics 00:04:14.009 --> 00:04:17.170 of buying and selling. The $100 note was basically 00:04:17.170 --> 00:04:19.850 that patch. And what a patch it was. The 1984 00:04:19.850 --> 00:04:22.509 version was a paper note, right? Printed in this 00:04:22.509 --> 00:04:25.449 very distinct light turquoise blue color. Yep, 00:04:25.889 --> 00:04:28.670 turquoise blue. And the design choices were incredibly 00:04:28.670 --> 00:04:31.180 deliberate. They focused heavily on scientific 00:04:31.180 --> 00:04:33.779 achievement and exploration. So on the front, 00:04:34.199 --> 00:04:36.319 the obverse, you had the Antarctic explorer, 00:04:36.399 --> 00:04:38.939 Sir Douglas Mawson. Oh, wow. Yeah, and he was 00:04:38.939 --> 00:04:40.720 set against a background of a mountain range 00:04:40.720 --> 00:04:43.319 rendered in geological strata, complete with 00:04:43.319 --> 00:04:45.480 this large diamond shape on the left. And then 00:04:45.480 --> 00:04:48.319 on the reverse, they featured John Tebbott. He 00:04:48.319 --> 00:04:50.879 was a pioneering Australian astronomer. They 00:04:50.879 --> 00:04:53.300 framed him with imagery of the observatory he 00:04:53.300 --> 00:04:56.089 built and a local church. That's pretty intricate. 00:04:56.410 --> 00:04:58.810 It was. And it wasn't just decorative, you know. 00:04:59.050 --> 00:05:01.870 Intricate, detailed artwork is always the first 00:05:01.870 --> 00:05:04.610 line of defense against forgery. But beneath 00:05:04.610 --> 00:05:06.970 those portraits of scientists lay the actual 00:05:06.970 --> 00:05:09.649 security technology of the era. Right. The stuff 00:05:09.649 --> 00:05:11.930 that actually stops the counterfeiters. They 00:05:11.930 --> 00:05:15.610 relied on a watermark of Captain James Cook embedded 00:05:15.610 --> 00:05:18.310 in the white field of the note. Which by the 00:05:18.310 --> 00:05:20.589 way was actually a deliberate callback because 00:05:20.589 --> 00:05:23.850 that exact same watermark was used in the last 00:05:23.850 --> 00:05:26.250 issue of the pre -decimal banknotes. A nice little 00:05:26.250 --> 00:05:29.170 historical touch. Yeah, and alongside that they 00:05:29.170 --> 00:05:31.990 embedded a metallic strip directly into the paper 00:05:31.990 --> 00:05:34.220 on the left side of the obverse. Think about 00:05:34.220 --> 00:05:36.240 the mechanics of that metallic strip for a moment. 00:05:36.519 --> 00:05:38.560 You can't just print a piece of metal onto paper 00:05:38.560 --> 00:05:41.240 using standard ink. No, obviously not. The strip 00:05:41.240 --> 00:05:43.759 has to be physically woven into the cotton or 00:05:43.759 --> 00:05:46.180 paper pulp during the manufacturing process. 00:05:46.579 --> 00:05:49.180 It was designed to completely thwart anyone trying 00:05:49.180 --> 00:05:51.540 to replicate the note with surface -level printing 00:05:51.540 --> 00:05:54.759 presses. That was totally cutting edge in 1984. 00:05:55.839 --> 00:05:57.920 But the technological landscape was shifting 00:05:57.920 --> 00:06:01.029 rapidly. The late 80s and early 90s saw this 00:06:01.029 --> 00:06:05.370 massive leap in commercial printing and the invention 00:06:05.370 --> 00:06:08.410 of high quality color photocopiers. Which was 00:06:08.410 --> 00:06:10.610 a nightmare for central banks. I can imagine. 00:06:10.810 --> 00:06:12.810 Suddenly a physical paper note, even with a woven 00:06:12.810 --> 00:06:15.990 metallic strip, was incredibly vulnerable. The 00:06:15.990 --> 00:06:17.790 counterfeiters were catching up to the technology. 00:06:18.230 --> 00:06:20.819 It triggered a fundamental crisis for currency 00:06:20.819 --> 00:06:24.139 issuers worldwide. I mean, when anyone with access 00:06:24.139 --> 00:06:27.420 to a high -end office photocopier can potentially 00:06:27.420 --> 00:06:29.560 replicate the nation's highest denomination, 00:06:30.139 --> 00:06:32.220 you can no longer rely on paper. You just have 00:06:32.220 --> 00:06:34.439 to invent an entirely new media. Precisely. You 00:06:34.439 --> 00:06:36.500 have to change the game entirely. Which brings 00:06:36.500 --> 00:06:41.459 us to May 1996. Just 12 years after introducing 00:06:41.459 --> 00:06:45.100 the paper $100 note, Australia completely overhauled 00:06:45.100 --> 00:06:48.069 it. They released a brand new version designed 00:06:48.069 --> 00:06:50.490 by Bruce Stewart, and this one wasn't paper at 00:06:50.490 --> 00:06:52.689 all. Right, it was a green polymer note. They 00:06:52.689 --> 00:06:55.730 abandoned cotton and paper entirely for a specialized, 00:06:56.089 --> 00:06:58.550 durable plastic. And the shift to polymer is 00:06:58.550 --> 00:07:00.850 like one of the most significant engineering 00:07:00.850 --> 00:07:03.410 leaps in the history of physical money. Oh, absolutely. 00:07:04.089 --> 00:07:06.569 The brilliance of polymer is that it allows for 00:07:06.569 --> 00:07:08.870 security features that are physically impossible 00:07:08.870 --> 00:07:11.449 to achieve on traditional substrates. It completely 00:07:11.449 --> 00:07:13.769 changed the roles of engagement with counterfeiters. 00:07:13.930 --> 00:07:15.829 And along with the new material came a massive 00:07:15.829 --> 00:07:18.490 aesthetic pivot. They moved away from the scientific 00:07:18.490 --> 00:07:21.269 explorers of the 84 note and shifted to the arts 00:07:21.269 --> 00:07:24.819 and military history. Yes, the 1996 note features 00:07:24.819 --> 00:07:27.800 portraits of the world -renowned soprano Dame 00:07:27.800 --> 00:07:30.740 Nellie Melba and the brilliant engineer and First 00:07:30.740 --> 00:07:33.480 World War general Sir John Monash. And accompanying 00:07:33.480 --> 00:07:36.279 Monash is vivid imagery from the First World 00:07:36.279 --> 00:07:38.819 War, right? Including that famous depiction of 00:07:38.819 --> 00:07:41.420 John Simpson Kirkpatrick and his donkey. It's 00:07:41.420 --> 00:07:43.800 this sweeping dramatic narrative of national 00:07:43.800 --> 00:07:47.279 identity. But the art, beautiful as it is, is 00:07:47.279 --> 00:07:49.600 entirely secondary to the optical physics at 00:07:49.600 --> 00:07:51.920 play. Oh, for sure. The most famous innovation 00:07:51.920 --> 00:07:54.480 is the clear, transparent window built right 00:07:54.480 --> 00:07:57.120 into the plastic. Inside that window, there is 00:07:57.120 --> 00:08:00.160 a raised, embossed image of the number 100 and 00:08:00.160 --> 00:08:03.220 a printed lyrebird. Let's break down why that 00:08:03.220 --> 00:08:05.740 window is such a big deal. When you're printing 00:08:05.740 --> 00:08:07.819 on polymer, you're essentially starting with 00:08:07.819 --> 00:08:10.420 a sheet of clear plastic. Right. You then apply 00:08:10.420 --> 00:08:13.160 layers of opaque ink everywhere except where 00:08:13.160 --> 00:08:16.199 you want the window to be. If a counterfeiter 00:08:16.199 --> 00:08:18.180 tries to replicate this on paper, what are they 00:08:18.180 --> 00:08:20.100 going to do? Like, cut a hole in the paper and 00:08:20.100 --> 00:08:22.079 tape a piece of clear plastic over it? They could 00:08:22.079 --> 00:08:25.339 try, but it wouldn't work. Exactly. The moment 00:08:25.339 --> 00:08:27.759 someone touches that fake note, they would instantly 00:08:27.759 --> 00:08:31.519 feel the tape in the seams. The tactile nature 00:08:31.519 --> 00:08:33.960 of the polymer itself becomes a massive security 00:08:33.960 --> 00:08:36.860 wall. And beyond the window, they layered in 00:08:36.860 --> 00:08:40.340 multiple covert features. They incorporated fluorescent 00:08:40.340 --> 00:08:43.299 coloring into the serial numbers and a specific 00:08:43.299 --> 00:08:45.980 value patch that remains completely invisible 00:08:45.980 --> 00:08:48.740 until the banknote is placed under ultraviolet 00:08:48.740 --> 00:08:51.220 light. Oh wow, that's so cool. Yeah, and they 00:08:51.220 --> 00:08:54.600 heavily utilized microprinting. That's text so 00:08:54.600 --> 00:08:56.799 miniscule it registers to the naked eye as a 00:08:56.799 --> 00:08:59.879 solid line, but reveals actual words under a 00:08:59.879 --> 00:09:02.200 magnifying glass. And I'm guessing normal printers 00:09:02.200 --> 00:09:04.799 couldn't do that. Not at all. Standard commercial 00:09:04.799 --> 00:09:07.080 printers of the era simply lacked the resolution 00:09:07.080 --> 00:09:09.360 to replicate that text without it blurring into 00:09:09.360 --> 00:09:11.580 a smudge. Here's where it gets really interesting. 00:09:12.000 --> 00:09:14.399 My absolute favorite feature is the Federation 00:09:14.399 --> 00:09:16.940 Star Trick. Oh, that's a brilliant piece of engineering. 00:09:17.059 --> 00:09:19.279 It is. So on the front of the note, they print 00:09:19.279 --> 00:09:22.240 four points of a star. On the back of the note, 00:09:22.259 --> 00:09:23.860 in the exact same spot, they print the other 00:09:23.860 --> 00:09:26.120 three points. Yep. If you hold the note flat 00:09:26.120 --> 00:09:27.860 and look at it, it just looks like a bunch of 00:09:27.860 --> 00:09:31.000 weird, disconnected geometric shapes. But the 00:09:31.000 --> 00:09:33.429 moment you hold that note up to the light, The 00:09:33.429 --> 00:09:35.809 translucent nature of the polymer allows the 00:09:35.809 --> 00:09:38.750 front and back to combine. They form a flawless, 00:09:39.450 --> 00:09:42.629 seamless, seven -pointed federation star. The 00:09:42.629 --> 00:09:45.279 precision required for that is staggering. In 00:09:45.279 --> 00:09:46.980 the printing industry, it's called registration. 00:09:47.600 --> 00:09:49.919 To make that star align, the printing plates 00:09:49.919 --> 00:09:51.860 on the front of the polymer sheet and the printing 00:09:51.860 --> 00:09:54.440 plates on the back have to strike the plastic 00:09:54.440 --> 00:09:57.679 with micrometer accuracy. Micrometers? That's 00:09:57.679 --> 00:10:00.639 insane. It really is. If the alignment is off 00:10:00.639 --> 00:10:03.139 by even a fraction of a millimeter, the star 00:10:03.139 --> 00:10:05.539 looks jagged and broken when held to the light. 00:10:06.220 --> 00:10:08.340 counterfeiters trying to print the front, flip 00:10:08.340 --> 00:10:10.960 the material, and print the back almost always 00:10:10.960 --> 00:10:13.419 fail the registration test. It's literally the 00:10:13.419 --> 00:10:16.639 1990s physical analog version of two -factor 00:10:16.639 --> 00:10:18.779 authentication. That's a great way to frame it. 00:10:18.779 --> 00:10:20.659 You have two independent pieces of information, 00:10:20.759 --> 00:10:22.740 the front pattern and the back pattern. Right. 00:10:22.740 --> 00:10:24.759 You can't just copy the front and you can't just 00:10:24.759 --> 00:10:27.279 copy the back. You have to perfectly align both 00:10:27.279 --> 00:10:29.960 separate factors through a translucent medium 00:10:29.960 --> 00:10:33.159 to verify that the item is genuine. If the star 00:10:33.159 --> 00:10:35.720 doesn't line up, Access is denied. It forces 00:10:35.720 --> 00:10:38.500 the counterfeiter to master not just the visual 00:10:38.500 --> 00:10:41.740 reproduction of the art, but the industrial manufacturing 00:10:41.740 --> 00:10:44.419 tolerances of a central bank. Yeah. Which is 00:10:44.419 --> 00:10:46.720 nearly impossible. But the race against financial 00:10:46.720 --> 00:10:49.519 crime never stops, does it? Never. Counterfeiters 00:10:49.519 --> 00:10:51.500 eventually get their hands on better technology, 00:10:51.740 --> 00:10:53.580 which means the central bank has to basically 00:10:53.580 --> 00:10:55.519 tear it all down and start over again. Yeah. 00:10:56.000 --> 00:10:57.700 According to our source material, in September 00:10:57.700 --> 00:11:00.679 2012, the Reserve Bank of Australia announced 00:11:00.679 --> 00:11:04.350 the Next Generation Bank Note program. They had 00:11:04.350 --> 00:11:07.529 to upgrade every single denomination to stay 00:11:07.529 --> 00:11:10.389 ahead of modern threats. And developing currency 00:11:10.389 --> 00:11:13.950 at this level of security is an exhaustive, painstaking 00:11:13.950 --> 00:11:16.610 process. They announced the program in 2012, 00:11:16.929 --> 00:11:19.769 but the new $100 note wasn't actually unveiled 00:11:19.769 --> 00:11:22.250 and released into circulation until late 2020. 00:11:22.450 --> 00:11:25.230 Eight years. Yeah. That is an eight -year development 00:11:25.230 --> 00:11:27.590 cycle for a single piece of physical currency. 00:11:27.879 --> 00:11:31.340 For this 2020 iteration, they kept the core historical 00:11:31.340 --> 00:11:34.580 portraits of Melba and Monash, but they completely 00:11:34.580 --> 00:11:37.480 shifted the supporting imagery to focus on Australian 00:11:37.480 --> 00:11:41.139 flora and fauna. The new note features the Australian 00:11:41.139 --> 00:11:44.419 masked owl and the golden wattle, which is Australia's 00:11:44.419 --> 00:11:47.220 national floral emblem. And alongside the visual 00:11:47.220 --> 00:11:50.220 overhaul, they introduced a profound functional 00:11:50.220 --> 00:11:53.799 change. The 2020 Note includes a brand new tactile 00:11:53.799 --> 00:11:56.539 feature, specifically engineered physical bumps 00:11:56.539 --> 00:11:59.360 designed to help people who are blind or have 00:11:59.360 --> 00:12:02.360 low vision to independently distinguish the $100 00:12:02.360 --> 00:12:04.639 Note from other denominations just by touching 00:12:04.639 --> 00:12:06.620 it. But wait, I want to push back on this a little 00:12:06.620 --> 00:12:09.340 bit. We live in an era where everyone just taps 00:12:09.340 --> 00:12:11.299 their phone or their smartwatch to pay for everything, 00:12:11.559 --> 00:12:14.169 right? Digital transactions are completely dominating 00:12:14.169 --> 00:12:16.669 our daily lives. They are. Why on earth did the 00:12:16.669 --> 00:12:18.769 government spend eight years and millions of 00:12:18.769 --> 00:12:21.169 dollars engineering physical bumps onto a piece 00:12:21.169 --> 00:12:24.289 of plastic when physical cash usage seems to 00:12:24.289 --> 00:12:26.649 be plummeting across the board? This raises an 00:12:26.649 --> 00:12:28.889 important question, and it strikes at the philosophical 00:12:28.889 --> 00:12:31.309 core of what public money actually is. Okay, 00:12:31.389 --> 00:12:34.110 how so? Well, a national currency is not a private 00:12:34.110 --> 00:12:37.129 tech product. It is a fundamental public utility. 00:12:37.720 --> 00:12:40.940 As long as it exists in a physical form, it must 00:12:40.940 --> 00:12:43.460 remain universally accessible to every single 00:12:43.460 --> 00:12:46.019 citizen, regardless of their physical abilities 00:12:46.019 --> 00:12:48.639 or their access to digital banking infrastructure. 00:12:48.960 --> 00:12:52.080 So if you just let physical cash degrade or you 00:12:52.080 --> 00:12:54.340 don't make it accessible, you're basically locking 00:12:54.340 --> 00:12:57.059 people out of the economy. Exactly the opposite 00:12:57.059 --> 00:12:59.509 of what a central bank is supposed to do. If 00:12:59.509 --> 00:13:02.009 you only focus on digital payment rails, you 00:13:02.009 --> 00:13:05.429 risk entirely excluding the most vulnerable populations, 00:13:05.690 --> 00:13:07.990 the elderly, the unbanked, and those with visual 00:13:07.990 --> 00:13:10.129 impairments. That makes a lot of sense. Imagine 00:13:10.129 --> 00:13:12.909 trying to navigate a physical cash economy where 00:13:12.909 --> 00:13:15.009 you can't see the value of the notes you're being 00:13:15.009 --> 00:13:18.009 handed in change. Upgrading the tactile accessibility 00:13:18.009 --> 00:13:20.909 isn't just a nice design choice. It is a strict 00:13:20.909 --> 00:13:23.879 mandate of financial inclusion. Okay, so we've 00:13:23.879 --> 00:13:26.000 tracked this intense evolution from a note that 00:13:26.000 --> 00:13:29.279 was deemed completely unnecessary in 1966, to 00:13:29.279 --> 00:13:32.320 a paper inflation fix with woven metal in 1984, 00:13:33.019 --> 00:13:36.840 to a high tech polymer 2FA system in 1996, to 00:13:36.840 --> 00:13:39.899 an inclusive tactile powerhouse in 2020. It's 00:13:39.899 --> 00:13:42.879 been quite the journey. It really has. But despite 00:13:42.879 --> 00:13:45.480 all of this massive investment in design and 00:13:45.480 --> 00:13:49.440 accessibility, the actual usage of the $100 note 00:13:49.440 --> 00:13:51.899 presents this bizarre paradox we talked about 00:13:51.899 --> 00:13:53.940 at the very start of the show. Oh, the circulation 00:13:53.940 --> 00:13:56.279 statistics provided in the source are just incredible 00:13:56.279 --> 00:13:59.399 to look at. In June 2005, there were roughly 00:13:59.399 --> 00:14:03.500 149 million of these $100 notes in circulation. 00:14:04.320 --> 00:14:07.120 At that time, they accounted for about 18 .5 00:14:07.120 --> 00:14:10.179 % of all notes out there. The cash value of those 00:14:10.250 --> 00:14:14.230 149 million notes was nearly $15 billion, which 00:14:14.230 --> 00:14:17.850 made up 41 .9 % of the total value of all denominations. 00:14:18.190 --> 00:14:21.669 So back in 2005, the $50 note was still the undisputed 00:14:21.669 --> 00:14:24.269 king in terms of total cash value. But then watch 00:14:24.269 --> 00:14:26.990 what happens over the next decade. By June 2017, 00:14:27.210 --> 00:14:29.090 the number of $100 notes had more than doubled. 00:14:29.289 --> 00:14:32.289 It jumped to an astonishing 337 million notes 00:14:32.289 --> 00:14:34.970 in circulation. Staggering increase. By 2017, 00:14:35.049 --> 00:14:37.870 they made up 22 % of the total physical notes, 00:14:37.909 --> 00:14:41.529 and their combined value hit 33. That means in 00:14:41.529 --> 00:14:45.870 2017, the $100 note accounted for 46 % of the 00:14:45.870 --> 00:14:48.409 total value of all cash in the Australian economy. 00:14:49.090 --> 00:14:51.070 Nearly half of the nation's physical wealth was 00:14:51.070 --> 00:14:53.990 tied up in this single high -value denomination. 00:14:54.190 --> 00:14:56.570 So what does this all mean? We have a denomination 00:14:56.570 --> 00:14:58.730 that holds nearly half the physical cash value 00:14:58.730 --> 00:15:01.490 in the country, yet you almost never see one. 00:15:01.809 --> 00:15:04.009 If I go to buy a sandwich, I'm tapping a card 00:15:04.009 --> 00:15:07.490 or handing over a 20. No one is carrying around 00:15:07.490 --> 00:15:10.570 a stack of hundreds. for daily errands. No, definitely 00:15:10.570 --> 00:15:13.809 not. The $100 note is the dark matter of the 00:15:13.809 --> 00:15:16.429 Australian economy. Oh, the astrophysics concept. 00:15:16.529 --> 00:15:18.730 I like that. Yeah. Think about how dark matter 00:15:18.730 --> 00:15:21.529 works in space. Scientists mathematically know 00:15:21.529 --> 00:15:23.669 that dark matter makes up the vast majority of 00:15:23.669 --> 00:15:25.730 the universe's mass because they can see its 00:15:25.730 --> 00:15:28.730 gravitational pull on other objects. The math 00:15:28.730 --> 00:15:31.350 absolutely proves it's there. Right, but you 00:15:31.350 --> 00:15:33.750 can't actually observe it directly. Exactly. 00:15:33.850 --> 00:15:35.629 It doesn't interact with light, so it's practically 00:15:35.629 --> 00:15:38.330 invisible to us. That is exactly what is happening 00:15:38.330 --> 00:15:41.470 with this banknote. The Reserve Bank's statistics 00:15:41.470 --> 00:15:45.830 mathematically prove that 337 million of these 00:15:45.830 --> 00:15:49.049 notes exist. The math shows the masses there, 00:15:49.490 --> 00:15:52.330 but in everyday observable transactional life, 00:15:52.990 --> 00:15:55.100 they are invisible. Because they aren't being 00:15:55.100 --> 00:15:57.659 used for transactions, they are being used as 00:15:57.659 --> 00:16:00.340 a dense store of value. When you want to hoard 00:16:00.340 --> 00:16:03.799 cash, physically storing $20 notes takes up five 00:16:03.799 --> 00:16:06.299 times as much physical volume as storing $100 00:16:06.299 --> 00:16:08.620 notes. That makes physical storage way easier. 00:16:08.840 --> 00:16:11.519 Exactly. A lot of this dark matter is sitting 00:16:11.519 --> 00:16:14.259 in legitimate safes or under mattresses held 00:16:14.259 --> 00:16:16.919 by people who simply distrust banks or want emergency 00:16:16.919 --> 00:16:20.279 reserves. But, as the source material heavily 00:16:20.279 --> 00:16:22.340 implies, this density of value makes the note 00:16:22.340 --> 00:16:24.879 incredibly useful for the black economy. Right, 00:16:24.980 --> 00:16:27.279 the underground economy, the untaxed, unregulated, 00:16:27.379 --> 00:16:29.940 cash -only transactions that completely bypass 00:16:29.940 --> 00:16:32.259 the official financial system. If you are trying 00:16:32.259 --> 00:16:35.269 to move large sums of money, without leaving 00:16:35.269 --> 00:16:38.490 a digital footprint, whether that's for tax evasion, 00:16:38.769 --> 00:16:41.570 paying off the books, labor, or funding illicit 00:16:41.570 --> 00:16:44.590 markets, you want the highest denomination possible. 00:16:44.769 --> 00:16:47.629 And this brings us to a major institutional controversy. 00:16:48.289 --> 00:16:51.190 In December 2016, reports surfaced suggesting 00:16:51.190 --> 00:16:53.909 that the Australian government was actively considering 00:16:53.909 --> 00:16:57.299 abolishing the $100 note entirely. Wow. just 00:16:57.299 --> 00:16:59.120 getting rid of it. The rationale was simple. 00:16:59.639 --> 00:17:01.659 By getting rid of the largest denomination, you 00:17:01.659 --> 00:17:03.519 essentially disrupt the logistics of the black 00:17:03.519 --> 00:17:06.920 economy. You make it physically harder, heavier, 00:17:07.200 --> 00:17:09.980 and more conspicuous to transport and hide large 00:17:09.980 --> 00:17:13.059 amounts of untaxed cash. And to be clear to you 00:17:13.059 --> 00:17:15.579 listening, we aren't taking a side here on whether 00:17:15.579 --> 00:17:18.700 demonetizing a national currency is good or bad 00:17:18.700 --> 00:17:21.970 fiscal policy. We are simply looking at the incredible 00:17:21.970 --> 00:17:24.150 paradox playing out in the facts we have. Right, 00:17:24.250 --> 00:17:26.710 we're just looking at the facts. In 2016, you 00:17:26.710 --> 00:17:29.269 have government reports openly debating whether 00:17:29.269 --> 00:17:31.849 to kill the note off entirely to choke the black 00:17:31.849 --> 00:17:35.410 economy. But at the exact same time, the Reserve 00:17:35.410 --> 00:17:38.829 Bank of Australia officially pushed back. They 00:17:38.829 --> 00:17:41.250 stated clearly they had no plans to abolish the 00:17:41.250 --> 00:17:43.130 note. And in fact, they were right in the middle 00:17:43.130 --> 00:17:46.630 of that massive eight year multimillion dollar 00:17:46.630 --> 00:17:49.490 next gen program to upgrade the note's security 00:17:49.490 --> 00:17:52.009 and tactile features for its grand release in 00:17:52.009 --> 00:17:54.710 2020. What's fascinating here is the stark tension 00:17:54.710 --> 00:17:57.069 between different arms of institutional planning. 00:17:57.210 --> 00:17:59.349 Yeah, there are total odds. The government is 00:17:59.349 --> 00:18:01.549 looking at the note as a loophole for financial 00:18:01.549 --> 00:18:04.289 crime that needs to be closed. But the Reserve 00:18:04.289 --> 00:18:06.630 Bank is looking at the note as a vital public 00:18:06.630 --> 00:18:09.799 utility that must be defended, upgraded, and 00:18:09.799 --> 00:18:12.039 made more accessible for legitimate users. It's 00:18:12.039 --> 00:18:14.420 a crazy dual nature. It highlights the dual nature 00:18:14.420 --> 00:18:17.539 of high value cash perfectly. It is simultaneously 00:18:17.539 --> 00:18:19.920 a lifeline for financial inclusion and privacy, 00:18:20.380 --> 00:18:22.660 and a preferred tool for operating outside the 00:18:22.660 --> 00:18:25.299 visible economy. The Reserve Bank ultimately 00:18:25.299 --> 00:18:28.200 chose to defend the utility of the note, investing 00:18:28.200 --> 00:18:30.599 heavily in its future rather than abandoning 00:18:30.599 --> 00:18:34.039 it. It is genuinely wild to think about how much 00:18:34.039 --> 00:18:37.279 history, engineering, and institutional controversy 00:18:37.279 --> 00:18:40.380 is folded up inside a single piece of polymer. 00:18:40.599 --> 00:18:43.519 It really is. We started this deep dive looking 00:18:43.519 --> 00:18:46.779 at a missing piece of the 1966 decimal rollout. 00:18:47.339 --> 00:18:49.279 We realized that inflation forced a physical 00:18:49.279 --> 00:18:52.869 paper patch in 1984. We watched the technological 00:18:52.869 --> 00:18:55.109 marvel of polymer and optical physics emerge 00:18:55.109 --> 00:18:57.829 in the 90s to fight off counterfeiters, and we 00:18:57.829 --> 00:19:00.569 ended up navigating the dark matter of the modern 00:19:00.569 --> 00:19:02.950 underground economy. It absolutely proves that 00:19:02.950 --> 00:19:05.609 a banknote is never just a static piece of money. 00:19:06.190 --> 00:19:08.589 It is an active reflection of the society that 00:19:08.589 --> 00:19:11.109 prints it. It maps out a country's scientific 00:19:11.109 --> 00:19:14.329 achievements, its historical figures, its economic 00:19:14.329 --> 00:19:17.329 struggles with inflation, and its ongoing technological 00:19:17.329 --> 00:19:19.450 ingenuity. Which leaves us with a really compelling 00:19:19.450 --> 00:19:21.490 thought to end on. The Reserve Bank officially 00:19:21.490 --> 00:19:24.470 refused to abolish the $100 note to fight the 00:19:24.470 --> 00:19:27.150 black economy back in 2016, choosing instead 00:19:27.150 --> 00:19:29.829 to upgrade it. But as digital payments and tap 00:19:29.829 --> 00:19:31.890 -to -pay infrastructure continue to naturally 00:19:31.890 --> 00:19:35.150 rise around the world, will the $100 note eventually 00:19:35.150 --> 00:19:38.230 disappear anyway? Not because a government mandated 00:19:38.230 --> 00:19:40.769 its destruction, but simply because the dark 00:19:40.769 --> 00:19:44.230 matter of physical cash naturally evaporates 00:19:44.230 --> 00:19:46.990 as society moves entirely online. A physical 00:19:46.990 --> 00:19:49.849 tool, no matter how brilliantly engineered, is 00:19:49.849 --> 00:19:52.490 only as permanent as our societal need to use 00:19:52.490 --> 00:19:55.130 it. The next time you manage to actually spot 00:19:55.130 --> 00:19:57.329 one of these elusive notes in the wild, take 00:19:57.329 --> 00:19:59.299 a second to hold it to the light. look at that 00:19:59.299 --> 00:20:02.019 Federation Star perfectly aligned, feel the tactile 00:20:02.019 --> 00:20:04.579 bumps on the plastic, and appreciate the absolute 00:20:04.579 --> 00:20:07.059 master class in engineering resting in the palm 00:20:07.059 --> 00:20:08.880 of your hand. Thank you so much for joining us 00:20:08.880 --> 00:20:10.279 on this deep dive. We'll catch you next time.