> for something like this we need to mint/print some physical object?
Ultra-large denomination bills are a relic. They preceded computerized records as an immutable record of interbank transfers.
For example, say someone in New York sends someone in San Francisco $100 million. Settlement-wise, the New York bank reduces the sender's deposit balance and moves reserves from its New York Fed reserve account to the New York Fed itself. The New York Fed moves these reserves into the San Francisco Fed’s account at the New York Fed. (These could, at the San Francisco Fed's option, then be couriered across the country.) The San Francisco bank, in turn, gets $100 million deposited into its reserve account at the San Francisco Fed and creates a deposit in the recipient's account.
Keeping track of all of the above is complicated. Physical settlement, in a country without the telegraph, reduced the risk of errors. Moving around tonnes of cash is inconvenient. Hence, super-large bills, used solely for the settlement layers above.
Until nixon axed the large bills as part of the drug war. With 1000$ being the new largest bill, gold bars/coins became a potentialy practical option once again. Krugerrands (sp?) tried to capture this market but never caught on.
$100 is the largest federal reserve note today. And even that is under pressure, mostly from the anti physical currency crowd.
Considering inflation a $100 note today is comparable to a $10 note from just a few decades ago. Thus currency denomination should shift in the opposite direction eliminating the cent and nickel, and adding larger notes.
Ultra-large denomination bills are a relic. They preceded computerized records as an immutable record of interbank transfers.
For example, say someone in New York sends someone in San Francisco $100 million. Settlement-wise, the New York bank reduces the sender's deposit balance and moves reserves from its New York Fed reserve account to the New York Fed itself. The New York Fed moves these reserves into the San Francisco Fed’s account at the New York Fed. (These could, at the San Francisco Fed's option, then be couriered across the country.) The San Francisco bank, in turn, gets $100 million deposited into its reserve account at the San Francisco Fed and creates a deposit in the recipient's account.
Keeping track of all of the above is complicated. Physical settlement, in a country without the telegraph, reduced the risk of errors. Moving around tonnes of cash is inconvenient. Hence, super-large bills, used solely for the settlement layers above.