Sorry, Rogoff, it looks like your own country just proved you wrong! As it turns out, demand for cash in the United States is still growing. According to the Federal Reserve Bank of San Francisco (FRBSF), the 'demand for U.S. currency continues to grow with 89 percent of American consumers holding cash to some extent.'
One look at the Cash Product Office's latest infographic and anyone can see that cash continues to thrive, particularly within the USA. No wonder Visa's challenge seemed so desperate. Come what may, cash continues to be the most preferred payment option for a multitude of reasons. In official FRBSF speak:
'Demand for currency continues to grow domestically and internationally, reflecting U.S. currency’s wide-spread use and its essential function as a means of payment and store of value.'
This means that public demand for cash is driving banks to order more cash from central banks than they return for processing. Economic activity such as interest rates, GDP growth rates and international demand can impact the demand for American cash. Similarly,non-economic activity such as natural disasters and new currency can also impact said demand. Consequently, 'currency in circulation grows [as] banks order more currency from the Federal Reserve than they return for processing, based on public demand.'