The document discusses the importance of cash during the COVID-19 pandemic. It notes that the pandemic has caused economic recession around the world and increased demand for essential items. Studies of past disasters, like earthquakes in New Zealand, show that cash is more reliable when systems are disrupted and helps stimulate local economies. The pandemic has also led many businesses and individuals to draw from credit lines to have more cash on hand. Cash provides financial security during times of crisis when technology may be compromised.

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Why Cash is King
WHY CASH IS KING: HOW THE IMPORTANCE OF CASH HAS SHOWN ITSELF IN THE TIME OF COVID-19
As at the 26th of May, the worldhas recorded more than 5.5 million cases of the coronavirus. The pandemic has led to
the deathsof 348,000 individualsacrossthe world.Lockdownmeasureshave beenreviewed,travelinghasbeenbanned
fromselectedcountries,small andlarge businesseshave beenforced to shut down since the emergence of the virus in
Wuhan,China.It isonlylogical toconclude thatthe economiesof the world,andseveral nations have suffered a drastic
recession.
It isin thispandemicthatthe discussionsaroundthe importance of cashhave gained more prominence. More than any
time inthe last few years, several individuals now see the relative importance of possessing cash in the long run. The
worldisplaguedwithuncertainty,anditis almost impossible to accurately predict the next moment; who would have
thought the whole world will be on lockdown in 2020? With the uncertainty of our existence comes the need to be
prepared at all times, hence the need to possess cash at hand.
Since the coronavirus gripped the world by the throat, the need to buy emergency items by family have increased
extensively. Ron Delnevo, the executive Director in Europe of the ATMIndustry Association says, "In such cases, cash
offersresidentsawayto purchase itemstomeettheirurgentneeds.Italsogiveslocal businesses a way to recover from
the impact of the disaster."
To cite a majorexample,adevastatingearthquake occuredinNew Zealandinthe years2010 and 2011. Financial experts
noticed that a spike arose in the need for cash, as the demand for essential items such as water, fuel, and food also
increased quickly. To make matters even worse, electronic retail payment systems began having glitches, due to the
impactof the earthquake.Withinafewdays,commercial banksorderedformore cashfromthe Central Bank.According
to RNBZ (Reserve Bank of New Zealand), there was an increase in the demand for cash all across the country.
Drawingfromcase studiesinHaiti,Australiaandthe Philippines,the OECD(Organization for Economic Cooperation and
Development) released a report that showed policies were needed to put cash at the centre of coming pandemics, or
natural disasters.If usedinthe rightcontext,cashis more reliable,ischeapertohold at hand, more efficient, and could
even boost the local economy.
Today, cash is the most trusted and fastest means of payment. Also, in a time like this, where technology is being
crippled by a lack of maintenance caused by lockdown measures as a result of the coronavirus, having cash at hand
provides financial security. Hence, to avoid a repetition of this economic mistake again, it is important that
governments,central and commercial banks, come up with cash policies which will cater for the needs of households
and even businesses in the emergence of a pandemic or a natural disaster.
The need for cash isn't a subject that affects only families, the availability of cash also has a direct influence on large,
medium and small businesses. In the early days of March, 2020, Boeing, who has suffered a grounding of one of its
airplanes, the 737 Max Aircraft, tapped a credit line of $13.8 billion which had been made available to it a month ago.
Otherreputable companiesinthe UnitedStatessuchasthe WynnResorts,SeaWorld Entertainment and Hilton have all
drewon theircreditlines,asthe economicimpactof the novel coronaviruskeepshitting.There are severalunconfirmed
reportsthat suggestthatevenprivate equityfirmsare makingplanstodraw from their credit lines. Also, a bank branch
for Chase in the Hamptons submitted a request for cash of $30,000, all in a bid to possess cash at hand.

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Banks in the United States are also doing everything within their powers to conserve cash; banks like Citigroup and
JPMorgan Chase have suspended the stock repurchasing program in a bid to save cash. The need for cash has even
shownitself atwithdrawal pointsin some locations in the United States; in early March, The New York Times reported
that a branch of the Bank of AmericainManhattan ran out of $100 bills.Thiswasbecause customers were withdrawing
thousands of funds every minute.
Perhaps Warren Buffet saw this pandemic coming, because the principle explained in a
meeting in the University of Maryland in 2013 offers an answer:
"BRK (Berkshire) always has $20 billion or more in cash. It sounds crazy, never need anything like it, but some day in the
next 100 years when the world stops again, we will be ready. There will be some incident, it could be tomorrow. At that
time, you need cash. Cash at that time is like oxygen.
"When you don't need it, you don't notice it. When you do need it, it's the only thing you need. We operate from a level
of liquidity that no one else does. We don't want to operate on bank lines.
"Something like thatwill happen maybea coupleof times in yourlifetime. Two thingswhen it happens again - don't let it
ruin you, and if you have money/guts, you'll have an opportunity to buy things at prices that don't make sense. Fear
spreads fast, it is contagious. It doesn't have anything to do with IQ. Confidence only comes back one at a time, not en
masse. There are periods when fear paralyzes the investment world. You don't want to owe money at that time, and if
you have money, then you want to buy at those times. Be greedy when others are fearful and fearful when others are
greedy."
Today,in the tryingtimesof COVID-19,cash isfreedom, securityandspeedinbuyingessential products. With a vaccine
for the virusstill outof sight, the need for cash for businesses, investors and households will increase, and only those
who have prepared accordingly will be safe.
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