It is no secret that banks in Greece have been losing deposits in recent months.
The question that is somewhat open, though, is where Greeks have been moving their deposits to. Have they been transferring the cash to other banks, or have they been squirreling it away under the mattress—and under bathroom tiles?
At first glance, data from the Bank of Greece seem to point to the deposit transfer option rather than the cash-under-mattress option as the "banknotes in circulation" line item on its balance sheet hasn't shown any big spike in recent months.
This, however, does not tell the full story.
The banknotes in circulation item on the Bank of Greece balance sheet only shows the amount of cash Greece has been allocated under its share of overall euro-area banknote circulation. Any extra cash needs of the Greek economy are accounted for elsewhere on the Bank of Greece balance sheet under the rather drab headline of "net liabilities related to the allocation of euro banknotes within the Eurosystem."
Charting that number, we can see a much more volatile series.
This extra cash was zero before the start of the Greek crisis in 2009, climbed above €22 billion in the months leading to the 2012 Greek political crisis, and had been falling steadily since. Until December of last year, that is, when the Greek political crisis reemerged following the collapse of the Samaras administration.
To get the actual amount of cash in Greece, we have to add together the totals in both of the above graphs, giving us this chart.
We can now clearly see there has been a €10 billion increase in cash in Greece in the three months to the end of February 2015.
That is a lot of mattresses.