The War on Cash is coming to an economy near you

Politics and religion.

Moderator: JasonNC

User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Thu Nov 19, 2015 1:37 am
“The cashless society is the IRS’s dream: total knowledge of, and control over, the finances of every single American.”

-Ron Paul

Central planners around the world are waging a War on Cash. In just the last few years:

- Italy made cash transactions over €1,000 illegal;
- Switzerland proposed banning cash payments in excess of 100,000 francs;
- Russia banned cash transactions over $10,000;
- Spain banned cash transactions over €2,500;
- Mexico made cash payments of more than 200,000 pesos illegal;
- Uruguay banned cash transactions over $5,000; and
- France made cash transactions over €1,000 illegal, down from the previous limit of €3,000.

The cashless society is coming. What are the real motives for limiting or eliminating physical cash transactions? It seems there are several, and none of them seem to be very good for us.
Last edited by Dorm on Thu Nov 19, 2015 1:41 am, edited 1 time in total.
Quote
User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Thu Nov 19, 2015 1:39 am
The bankers’ war on cash
http://www.wnd.com/2015/06/the-bankers-war-on-cash/


When JPMorgan Chase recently informed customers that the bank will no longer allow cash to be stored in safety deposit boxes, it capped off a frightening trend in banker restrictions on cash usage and storage internationally:

1. Citi’s Willem Buiter recently advocated abolishing cash altogether in order to “solve the world’s central banks’ problem with negative interest rates.”

2. Chase instituted a new policy which “restricts borrowers from using cash to make payments on credit cards, mortgages, equity lines, and auto loans.”

3. The Justice Department has ordered bank employees to consider calling the police on customers who withdraw $5,000 or more.

4. HSBC is now interrogating its account holders in the UK on how they earn and spend their money as well as restricting cash withdrawals for customers.

5. Banks in the U.S. are making it harder for customers to withdraw and deposit cash, with Chase imposing new capital controls that mandate identification for cash deposits and ban cash being deposited into another person’s account.

6. Chase banned international wire transfers while restricting cash activity for business customers (both deposits and withdrawals).
Quote
User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Thu Nov 19, 2015 1:47 am
Sweden first country to go cashless?
http://www.zerohedge.com/news/2015-11-1 ... -come-true

The Swedes were the first in Europe to issue paper currency. They may be the first to eliminate it too.

According to Credit Suisse, 80% of all purchases in Sweden are electronic and don’t involve cash.

Sweden’s supply of physical currency has dropped over 50% in the last six years. A couple of major Swedish banks no longer carry cash.

There's many different potential hazards with this kind of system. The first is that if the electronic money system goes down for any stretch of time, so do you.
Quote
User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Thu Nov 19, 2015 2:43 am
Call Cease-Fire in the War on Cash

http://www.bloombergview.com/articles/2 ... ar-on-cash
Quote
User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Wed Feb 10, 2016 11:58 pm
This is getting lots of people anxious. Abolishing cash and negative interest rates

Citi Economist Says It Might Be Time to Abolish Cash
http://www.bloomberg.com/news/articles/ ... olish-cash
The world's central banks have a problem.

When economic conditions worsen, they react by reducing interest rates in order to stimulate the economy. But, as has happened across the world in recent years, there comes a point where those central banks run out of room to cut — they can bring interest rates to zero, but reducing them further below that is fraught with problems, the biggest of which is cash in the economy.

In a new piece, Citi's Willem Buiter looks at this problem, which is known as the effective lower bound (ELB) on nominal interest rates.

Fundamentally, the ELB problem comes down to cash. According to Buiter, the ELB only exists at all due to the existence of cash, which is a bearer instrument that pays zero nominal rates. Why have your money on deposit at a negative rate that reduces your wealth when you can have it in cash and suffer no reduction?

Cash therefore gives people an easy and effective way of avoiding negative nominal rates.

Buiter's note suggests three ways to address this problem:

1. Abolish currency.

2. Tax currency.

3. Remove the fixed exchange rate between currency and central bank reserves/deposits.

Yes, Buiter's solution to cash's ability to allow people to avoid negative deposit rates is to abolish cash altogether. (Note that he's far from being the first to float this idea. Ken Rogoff has given his endorsement to the idea as well, as have others.)

Before looking at the practicalities of abolishing currency, we should first look at whether it could ever be necessary. Due to the costs of holding large amounts of cash, Buiter puts the actual nominal rate at which the move to cash makes sense as closer to -100bp. So, in order for a cash abolition to become necessary, central banks would need to be in a position where they wished to set nominal rates much lower than that.

Buiter does not have to go far to find an example of where a central bank may have wanted to set interest rates much lower to -100bp. He uses (a fairly aggressive) Taylor Rule to show that Federal Reserve rates should have been as low as -6 percent during the financial crisis.


Minus 100bp = -1%. Why would anyone have money in the bank if it's making -1% or, according to the theory, much worse? The answer is, if they abolish physical cash, and money is trapped inside digital banking system, they can set whatever interest rate they want. You pay them to mind your totally fictional money.
Last edited by Dorm on Thu Feb 11, 2016 12:32 am, edited 1 time in total.
Quote
User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Thu Feb 11, 2016 12:18 am
How the Cashless Society will benefit those in power

Here are some (but not all) benefits to banks and governments by eliminating cash:

*Every financial transaction can be taxed
*Every financial transaction can be charged a fee
*Every financial transaction is known by the government and the corporations involved
*Every financial transaction will involve less human oversight
*Any 'bad' person can have their access to buying and selling limited or turned off
*Any 'bad' person can have any amount of their money confiscated by government
*Not a cent can be hoarded, secreted overseas, or removed from the grid. No money under the mattress or in your wallet or hidden in a foreign account.
*No more cheating on taxes.
*No more private cash hand-outs to the poor. No more private cash gifts.
*No more black market transactions. All private selling could be taxed and regulated.
*Bank runs are eliminated.


Bank Runs
In fractional reserve systems such as ours, banks are only required to hold a fraction of their assets in cash. Thus a bank might only have 1 percent of its assets in cash. If customers fear the bank might be insolvent, they crowd the bank and demand their deposits in physical cash. The bank quickly runs out of physical cash and closes its doors, further fueling a panic.

The federal government began insuring deposits after the Great Depression triggered the collapse of hundreds of banks, and that guarantee limited bank runs, as depositors no longer needed to fear a bank closing would mean their money on deposit was lost.

But since people could conceivably sense a disturbance in the Financial Force and decide to turn digital cash into physical cash as a precaution, eliminating physical cash also eliminates the possibility of bank runs, as there will be no form of cash that isn’t controlled by banks.
Quote
User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Thu Feb 11, 2016 12:31 am
Norway's biggest bank DNB calls for the end of cash

http://www.independent.co.uk/news/world ... 28796.html

Norway's largest bank has called for the country to go totally cashless over fears of illegal activity.

DNB has said 60 per cent of Norwegian cash usage is out of government control and is being used in money laundering schemes and black market deals.

Executive vice president Trond Bentestuen told VG there is approximately 50 billion kroner in circulation with the central Norges Bank only being able to account for 40 per cent of its use.

He added:"That means that 60 per cent of money usage is outside of any control.

"We think much of it revolves around the black economy and money laundering.

"There are so many dangers and disadvantages associated with cash, we have concluded that it should be phased out."



That's how it starts. The big financial guys suggest that cash is evil. Dirty. It's being used for "the black economy" and money laundering. People are buying guns and dirty bombs. Drugs and hookers. Terrorists love cash and gold! They're OUTSIDE OF ANY CONTROL. Stop the terrorists and criminals. Surrender the cash.
Quote
User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Thu Feb 11, 2016 12:40 am
Negative interest rates could be necessary to protect UK economy, says Bank of England chief economist. And he suggests cash could need to be abolished

Andy Haldane, the Bank of England's chief economist explains:
http://www.telegraph.co.uk/finance/bank ... omist.html


We're going to get wiped out by these smiling technocrats who never did an honest day of labour in their lives. Negative rates. More monetary inflation (money-creation out of thin air). And a drastic switch from money in your hand to money existing only in a fictional digital world that is frighteningly outside the control of the proper owners.

The stupid smartphone generation is going to eat it up.
Quote
User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Thu Feb 11, 2016 12:44 am
Leading German Keynesian Economist Calls For Cash Ban
http://www.zerohedge.com/news/2015-05-1 ... s-obsolete
Quote
User avatar
AJ Research Dept
Posts: 2879
Joined: Fri Aug 06, 2010 1:14 am
PostPosted: Thu Feb 11, 2016 12:56 am
Larry Summers: put interest rates at zero or in the negative, and phase out physical cash

http://www.businessinsider.com/larry-su ... nd-2013-11

Larry Summers made this eerie speech 3 years ago. Remember his name. He is an extremely influential economist, friends with the highest of the financial elite, and he was a bigtime financial manager for the federal government and the Wall Street banks.
https://en.wikipedia.org/wiki/Lawrence_Summers

A close look at his work with government reveals that he was one of the instrumental 'wise men' recruited to take the USA apart, bit by bit, via economic policy. He helped shape Clinton economic policy and the whole globalization/offshoring thing, herding corporate infrastructure to China and Mexico, etc. Then he came back to help shape the Obama economic policy.

He has a chair at the big boy table where the Rockefellers sit.
Image
Image
Quote
Next

Return to It matters!

Who is online

Users browsing this forum: No registered users and 1 guest

cron