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For some, change in money doesn't add up

Money is causing a problem here. There is too much of it.

Since January, when Mexico decided to slice three zeros from all its denominations and issue new coins and bills, the country has been operating with two different systems of money, old pesos and new pesos. If the 11 bills and 13 coins in circulation were not enough, a new 20-peso coin, worth about $6.60, is being introduced.

The handsome new coin, with a traditional center of 0.925 pure Mexican silver surrounded by an alloy of bronze and aluminum, is _ like a new 20-peso bill _ the equivalent of the old 20,000-peso bill still in circulation.

That is not equivalent to the old 200-peso coin _ now worth the same as the new 20-centavo coin _ or the 2-peso coin, which like the old 2,000-peso bill, is just about enough to pay for a newspaper.

The old bills and coins will eventually be withdrawn. But for now the dual system demands constant vigilance because many prices are still stated in old pesos, and making change can involve a hodgepodge of new and old currency.

"People will give me 1 peso and think it's 5 pesos," said Griselda Recillas, a 15-year-old who sells nail polish and hair spray at a stand in Chapultepec Park. "But I always look. I make sure."

Even at the Bank of Mexico, officials acknowledge confusion when faced with handling the button-sized 5- and 10-centavo coins that people have been known to throw away.

Few things in life pack such emotional punch as money, and here the peso is almost revered as a symbol of sovereignty. Jose Lopez Portillo, a former president, once vowed that he would "defend the peso like a dog." Later, toward the end of his administration, it was devalued, and people still bark and howl at him.

Mexican newspapers are constantly filled with dire predictions of another peso devaluation because of the nation's growing trade deficit, but for most people, the bigger worry is making sure not to confuse a new 10-peso bill with an old 2,000-peso bill because both are the same shade of green.

Neftali Gutierrez, a cab driver in Mexico City, keeps a wooden box under his dashboard filled with at least two of every kind of new and old coin as well as several of each bill in circulation. He even keeps some currency that is no longer in circulation, like the 1,000-peso bills, which look like the 5,000-peso bills that still circulate.

The other big worry _ a constant of life here _ is finding change. The most common bills are 50,000 pesos, worth about $16 at the current exchange rate. They are slowly being overtaken by 50-peso bills _ not to be confused with the old 50-peso coins, which are now worth 5 centavos, or about 1.6 American pennies.

The old 50,000-peso bills and their new 50-peso replacements are uniformly rejected by the newspaper stands and candy vendors that clog many street corners, a clear sign of the disparity between the formal and informal economies of this nation.

Even in a fast-food restaurant or taco place, a 50,000-peso bill can draw scowls. Worse yet is someone who cannot pay a bill that comes to less than an even peso denomination, say 17,850 old pesos, which would be rounded off in new pesos to 17.80, or 17.90 or, more commonly, 18 pesos even. The idea is that eventually the bills that are rounded up will be balanced by those for 17.20 new pesos that are rounded down.

It all makes for a pretty loose sense of money and a constant fear that something is going to go wrong.

In truth, the new system was supposed to keep salaries, rents and the real price of a taco constant while making the whole system simpler by slicing off all those zeros. In the long run, it could also allow the government to issue higher denominations, like a 1,000-new-peso bill ($330) without losing face.

Under the old system, such a bill would have carried a 1-million-peso denomination.

The new 20-peso coin is a big step for Mexico in symbolic terms because it puts to rest some old worries about inflation that led to adding those zeros in the first place.

By minting a coin of pure silver, Mexico is banking on the fact that inflation _ which government officials announced last week had, for the first time, slipped below 10 percent for a 12-month period _ was under control and that the coins would not be melted down rather than spent in stores.

But just in case, the mint has surrounded them with the aluminum alloy, which makes melting them unprofitable.