If tracking cash transactions were as easy as you make them out to be, every illegal laundering from drugs to arms would have been long shut down.
a unique serial number is not personally identifiable by itself. Cash is far more anonymous than bitcoin, yes people can theoretically track it, with bitcoin EVERY transaction is by definition recorded. With cash some transactions maybe recorded, retailers do not necessarily record the serial number of every bill of each transaction, while that is certainly possible it is still not common place. Even if all were tracked in the U.S. there are still plenty of holes in your graph, making it difficult to every get anywhere near full picture, primarily due to the nature of U.S. currency. Plenty of people in the world use $ as their medium of exchange, these people who feds have very little control over and can do little to track either.