They do fold easily, but trying to flatten them again is not really as simple, especially after they've been folded in your wallet for a while. Not my problem, if it is out of the wallet, I'm spending it so flattening it isn't my problem.
To answer Leto's question. We replaced $1 and $2 with coins about the same time the plastic money came in (15 years or more ago). With inflation, they *are* pocket change anyway. My daily train ticket costs (7 stations and return) costs more than $7 (AU). They days of giving yourself sugar poisoning with 20c worth of lollies are long gone.
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who hid my keyboard's PANIC button?
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