Larry Summers: Time to scrap $100 bill

Jessica Hartogs, special to CNBC
Larry Summers says it's time to scrap $100 bill

Veteran U.S. economist Larry Summers says that "it's time to go after big money," in his latest column for The Washington Post.

But rather than going after the top 1 percent, the former chief economist of the World Bank is backing calls for removing the 500 euro and $100 bills from circulation.

Summers argues that the fact that "in certain circles the 500 euro note is known as the 'Bin Laden,'" is exactly the reason why it should no longer be printed; pointing to the illicit activities associated with the bill to give it such a nickname.

"A moratorium on printing new high denomination notes would make the world a better place. In terms of unilateral steps, the most important actor by far is the European Union. The €500 is almost six times as valuable as the $100," writes Summers.

This may be the next money laundering capital

Last week Peter Sands, the former head of Standard Chartered Bank and now senior fellow at the Harvard Kennedy School, published a paper stating that eliminating high-value notes that are rarely used would help deter tax evasion, financial crime, terrorism financing and corruption.

In his column, Summers calls for a ban on printing notes worth more than $50 or $100 USD.

"Such an agreement would be as significant as anything else the G7 or G20 has done in years," states Summers.

To read more of Larry Summer's column, please click here.

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