Monday, July 9, 2012

Traveler's Checks

The Wikipedia Money supply table here lists traveler's checks as a component of M1 money.

You see it at FRED, too:

M1 includes funds that are readily accessible for spending. M1 consists of: (1) currency outside the U.S. Treasury, Federal Reserve Banks, and the vaults of depository institutions; (2) traveler's checks of nonbank issuers; (3) demand deposits; and (4) other checkable deposits...

I finally got tired of seeing traveler's checks listed as a component, and not knowing how significant a component it is. So I interrupted myself and graphed the thing:

Graph #1: Traveler's Checks as a Percent of M1 Money
Around 1980, traveler's checks peaked at less than one percent of M1 (money in circulation). Currently, less than twenty cents of every hundred dollars is in the form of traveler's checks.


Jazzbumpa said...

Killed by credit cards would be my guess.

Anonymous said...

This sort of tells the story:

Traveler's cheques established American Express as a truly international company.

Also: American Express executives discussed the possibility of launching a travel charge card as early as 1946, but it was not until Diners Club launched their card in March 1950 that American Express began to seriously consider the possibility. At the end of 1957, American Express CEO Ralph Reed decided to get into the card business, and by the launch date of October 1, 1958 public interest had become so significant that they issued 250,000 cards prior to the official launch date.