Cash is tricky stuff.

First of all, it's sure to lose value, unless we go into a deflationary economic situation, which is very very bad.

Secondly, if you lose it, it's gone and there's no getting it back.

Third, you have basically no consumer protections with cash purchases.

Fourth, it's getting harder to use cash to conduct certain kinds of transactions (like buying a plane ticket).

That said, I know that there are a few limited scenarios where cash would be preferable. Blackouts are one, and a widespread failure of the telecommunications infrastructure is another. The former has happened. The latter has only happened in limited area and for limited time.

For example, did you know that there was a cable cut last week that knocked out lines for Verizon and AT&T? http://online.wsj.com/article/BT-CO-20100726-713152.html

I can't even find a record of a national telecommunications infrastructure outage in the last 10 years. There's been portions, but never the whole thing. So the credit card networks will stay up, even if parts go down.

So yeah, you might need some cash. Fuel purchases seem to be the big need, but if the power is out, the pumps are out, and no cash is going to help with that.

Food might be a concern, but you don't need a lot to eat.

I'd love to open this topic up in another thread...Bug Out to WHERE and WHY and can someone, anyone, please please please give me case history in the last 40 years where we had a "Bug Out" situation that was not related to a weather incident?

I can think of only two in the USA:

Centralia PA - fire burning in coal seam under town slowly eats it. "Bug Out" consists of packing up trucks and moving away.

Love Canal, NY - chemicals dumped turn town into hazmat site.
"Bug Out" consists of packing up trucks and moving away.

And of course, there's the all-time great example of Bug Out, Chernobyl, but that's a whole different situation, we don't have plants like that here, we don't have the same concerns and the effects of even a meltdown here would be bad, but not like there.