And Now, A Crackdown On Cash

Within hours of the stunning announcement, massive lines had formed in the bitter, early-morning cold, waiting for banks to open. "People are afraid," says Vladimir Kuzmichov, a retired engineer nervously fingering his cash notes outside a Moscow bank. The Soviet state bank had just proclaimed that all 50- and 100-ruble notes would be banned and saving accounts would be partly frozen. Each person could exchange up to 1,000 rubles, the equivalent of less than four months' average pay, for small-denomination notes. Although the move was supposed to be aimed at dealing a blow to black-market operators, who hold huge sums of cash, its real effect will be to wipe out the savings of millions of ordinary Soviets such as Kuzmichov, who have stashed away billions of rubles in mattresses and coffee cans. Many of the wily black-market operators had converted their rubles into dollars long before.

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