Well, they’ve done it. The European Central Bank will phase out the €500 note favored by cash hoarders and others who want to store economic value in a tangible place. The move ought to have a long-term effect on the broader tangible asset market. Paintings, Cars, furniture and design objects are also good stores of value and readily exchangeable.

The New York Times has a clever chart (above) showing the weight and volume of $1m in various denominations. From the chart you can see that one can move $5m in a single standard briefcase using €500 bills.

The one brake on this pressure is the fact that the EU will not end the bills’ status as legal tender:

Getting rid of the €500 bill “will make life harder for criminals, raising their costs and increasing their detection risks,” Peter Sands, the lead author of the Harvard study and a former chief executive of the British bank Standard Chartered, wrote in an email on Wednesday.

The European Central Bank said it would not take the more radical step of declaring that €500 bills are no longer legal tender. Such a move would have meant the notes could no longer be legally used for transactions. People with €500 notes would have had to bring them back to a central bank to be exchanged for smaller denominations.

Mr. Sands said the central bank could take steps to discourage use of the notes still in circulation, for example, by requiring banks to ask questions when customers present €500 bills for deposit.

Europe to Remove 500-Euro Bill, the ‘Bin Laden’ Bank Note Criminals Love (The New York Times)