Guest views are now limited to 12 pages. If you get an "Error" message, just sign in! If you need to create an account, click here.

Jump to content
  • CRYPTO REWARDS!

    Full endorsement on this opportunity - but it's limited, so get in while you can!

This is the Real Reason for the War on Cash


RSTEFAN
 Share

Recommended Posts

http://www.zerohedge.com/news/2016-02-18/end-economic-liberty-war-cash-wont-end-well

This Is The Real Reason For The War On Cash
 
picture-5.jpg
Submitted by Tyler Durden on 02/18/2016 09:00 -0500
 
 

Originally posted Op-Ed via The Wall Street Journal,

These are strange monetary times, with negative interest rates and central bankers deemed to be masters of the universe. So maybe we shouldn’t be surprised that politicians and central bankers are now waging a war on cash. That’s right, policy makers in Europe and the U.S. want to make it harder for the hoi polloi to hold actual currency.

 

Mario Draghi fired the latest salvo on Monday when he said the European Central Bank would like to ban €500 notes. A day later Harvard economist and Democratic Party favorite Larry Summers declared that it’s time to kill the $100 bill, which would mean goodbye to Ben Franklin. Alexander Hamilton may soon—and shamefully—be replaced on the $10 bill, but at least the 10-spots would exist for a while longer. Ol’ Ben would be banished from the currency the way dead white males like him are banned from the history books.

 

Limits on cash transactions have been spreading in Europe since the 2008 financial panic, ostensibly to crack down on crime and tax avoidance. Italy has made it illegal to pay cash for anything worth more than €1,000 ($1,116), while France cut its limit to €1,000 from €3,000 last year. British merchants accepting more than €15,000 in cash per transaction must first register with the tax authorities. Fines for violators can run into the thousands of euros. Germany’s Deputy Finance Minister Michael Meister recently proposed a €5,000 cap on cash transactions. Deutsche Bank CEO John Cryan predicted last month that cash won’t survive another decade.

 

The enemies of cash claim that only crooks and cranks need large-denomination bills. They want large transactions to be made electronically so government can follow them. Yet these are some of the same European politicians who blew a gasket when they learned that U.S. counterterrorist officials were monitoring money through the Swift global system. Criminals will find a way, large bills or not.

 

 

The real reason the war on cash is gearing up now is political: Politicians and central bankers fear that holders of currency could undermine their brave new monetary world of negative interest rates. Japan and Europe are already deep into negative territory, and U.S. Federal Reserve Chair Janet Yellen said last week the U.S. should be prepared for the possibility. Translation: That’s where the Fed is going in the next recession.

 

 

Negative rates are a tax on deposits with banks, with the goal of prodding depositors to remove their cash and spend it to increase economic demand. But that goal will be undermined if citizens hoard cash. And hoarding cash is easier if you can take your deposits out in large-denomination bills you can stick in a safe. It’s harder to keep cash if you can only hold small bills.

 

So, presto, ban cash. This theme has been pushed by the likes of Bank of England chief economist Andrew Haldane and Harvard’s Kenneth Rogoff, who wrote in the Financial Times that eliminating paper currency would be “by far the simplest” way to “get around” the zero interest-rate bound “that has handcuffed central banks since the financial crisis.” If the benighted peasants won’t spend on their own, well, make it that much harder for them to save money even in their own mattresses.

 

All of which ignores the virtues of cash for law-abiding citizens. Cash allows legitimate transactions to be executed quickly, without either party paying fees to a bank or credit-card processor. Cash also lets millions of low-income people participate in the economy without maintaining a bank account, the costs of which are mounting as post-2008 regulations drop the ax on fee-free retail banking. While there’s always a risk of being mugged on the way to the store, digital transactions are subject to hacking and computer theft.

 

Cash is also the currency of gray markets—amounting to 20% or more of gross domestic product in some European countries—that governments would love to tax. But the reason gray markets exist is because high taxes and regulatory costs drive otherwise honest businesses off the books. Politicians may want to think twice about cracking down on the cash economy in a way that might destroy businesses and add millions to the jobless rolls. The Italian economy might shut down without cash.

 

By all means people should be able to go cashless if they like. But it’s hard to avoid the conclusion that the politicians want to bar cash as one more infringement on economic liberty. They may go after the big bills now, but does anyone think they’d stop there? Why wouldn’t they eventually ban all cash transactions much as they banned gold and silver as mediums of exchange?

 

Beware politicians trying to limit the ways you can conduct private economic business. It never turns out well.

 

 

  • Upvote 4
Link to comment
Share on other sites

http://www.acting-man.com/?p=43321

you will have to go to the link to see the pictures

When Cash Is Outlawed… Only Outlaws Will Have Cash February 18, 2016 | Author Bill Bonner

inShare.0

Control, Tax, Confiscate

BALTIMORE – Harvard economist Larry Summers is a reliable source of claptrap. And a frequent spokesman for the Deep State.

To bring new readers up to speed, voters don’t get a say in who runs the country. Instead, a “shadow government” of elites, cronies, lobbyists, bureaucrats, politicians, and zombies – aka the Deep State – is permanently in power.

Larry Summers – the man with a plan for everyone. An economist whose economic theorizing is truly abominable crap (more on this in an upcoming post), a reliable, crypto-fascist, bought and paid for evil intellectual in the service of the Deep State. His “policy proposals” all have one thing in common: they are apodictically certain to restrict economic progress and individual liberty.

Photo credit: Fabrice Coffrini / AFP / Getty Images

Put simply, it doesn’t matter which party is in power; the Deep State rules. Want to know what the Deep State is up to now? Read Larry Summers.

“It’s time to kill the $100 bill,” he wrote in the Washington Post (another reliable source of claptrap).

The Deep State wants you to use money it can easily control, tax, and confiscate. And paper currency is getting in its way.

France has already banned residents from making cash transactions of €1,000 ($1,114) or more. Norway and Sweden’s biggest banks urge the outright abolition of cash. And there are plans at the highest levels of government in Israel, India, and China to remove cash from circulation.

Deutsche Bank CEO John Cryan predicts that cash “probably won’t exist” 10 years from now. And here is Mr. Summers in the Washington Post:

“Illicit activities are facilitated when a million dollars weighs 2.2 pounds as with the 500 euro note rather than more than 50 pounds, as would be the case if the $20 bill was the high denomination note.”

He proposes “a global agreement to stop issuing notes worth more than say $50 or $100. Such an agreement would be as significant as anything else the G7 or G20 has done in years.”

What makes Mr. Summers so confident that a ban on Ben Franklins would be a good thing? It turns out that a research paper – presented by Peter Sands, the former CEO of British bank Standard Chartered, and published for the Harvard Kennedy School of Government – says so.

Idiotic Ideas

“High denomination notes,” said the report, “play little role in the functioning of the legitimate economy, yet a crucial role in the underground economy.”

Mr. Sands should know about hiding money. While he was CEO, New York’s top financial regulator threatened to strip Standard Chartered of its banking license. It claimed the bank “schemed” with the Iranian government to hide at least 60,000 illegal transactions – involving at least $250 billion.

If the Benjamin is killed, it will “deter illicit activities” they say, apparently taking us all for complete idiots. Very organized criminals all over the world could be heard rolling on the floor laughing their heads off at this pronouncement. Here’s another idea: if we lock all the peasants up in a small room without doors and windows, they will no longer have to suffer the indignities and dangers inflicted by bad weather! Never again will they be made wet and uncomfortable by rain, and the threat of skin cancer due to excessive exposure to sunlight (as recently highlighted by Hugh Jackman’s withering nose) will soon be but a distant memory. Isn’t such a comprehensive level of security well worth whatever small trade-offs it involves?

Here at the Diary, we don’t pretend to know how to improve the world. We just know what we like. And we don’t like other people telling us what to do. Last year, we traveled all around the world. We went where we wanted to go. We did more or less what we wanted to do. Rarely did we feel that someone was bossing us around. But back in the USA…

“Take your belt off. Take your shoes off. Anything in your pockets? Take it out…”

“Turn on lights. Fasten seat belts. Turn on windshield wipers.”

This morning, walking through the park, we found this sign:

Curb Your Pets

Not just a courtesy to your neighbors

IT’S THE LAW

The unspoken threat behind the “law”, made explicit.

Image credit: Francesco Francavilla

People who insist you follow their ideas are always the same people whose ideas are idiotic.

“Always do the opposite of what they tell you do,” said a friend in France whose father was mayor of a small town during World War II.

“There had been ‘an incident.’” he explained. “I think the Resistance had killed a German soldier in the area. It was that time, late in the war, when the Nazis were retaliating against civilians.

“So, they told my father to get everyone in town to assemble in the town square. Instead, my father told everyone to run for the woods. They all did. They were lucky. They survived the war.”

Electronic Dollars

And now, Mr. Summers wants us to bring our cash to the town square. Instead of $100 bills, he wants to force us to use electronic notations faithfully recorded in a federally regulated bank. Have you ever seen one of these “electronic dollars,” dear reader?

We have not. We don’t know what they look like. And we’re deeply suspicious of the whole thing. The European Central Bank and the Bank of Japan – along with central banks in Denmark, Sweden, and Switzerland have already imposed a negative interest rate “tax” on the accounts commercial banks hold with them (known as “reserve accounts”).

Negative yielding government bonds in Europe as of December 2015 – a monument to the decline of Western civilization

These central banks are hoping banks will pass on this new tax to their customers. This has already happened in Switzerland…

As colleague Chris Lowe told Bonner & Partners Family Office members at our recent annual meeting in Rancho Santana in Nicaragua, Alternative Bank Schweiz (ABS) will begin charging a negative interest rate on customers’ deposits this year.

ABS will levy an annual penalty of 0.125% on deposits of less than 100,000 Swiss francs ($101,173) and an annual penalty of 0.75% on deposits of more than 100,000 Swiss francs. Essentially, ABS is charging its customers to keep their money on deposit.

If you put $1 million in the bank, at 0.75% negative interest, you come back a year later, and you have $992,500 left. The bank has confiscated the other $7,500. At a negative rate of, say, 3%… you pay $30,000 a year just to keep your money on deposit. It sounds like a scam…

Governments abolish cash. You have no choice but to leave your savings on deposit. And you’re forced to pay banks for storing your money.

Cash Outlaw

But wait. Banks are not really storing “your” money at all. A bank deposit is an IOU from your bank. There is no vault cash backing it up… just 1s and 0s on a database somewhere. If the bank decides not to give you “your” money, you’re out of luck.

It’s as though someone offers to store your cherry pie. Then he goes and eats the pie, promising to give you one just like it when you want it. He then has the cheek to charge you every month for “storing” the pie. And when you want it, he won’t be able to give it to you.

The precedent – no-one can say they weren’t warned.

Cartoon by Harm Bengen

“I don’t have any baking powder. You’ll have to come back tomorrow,” he says. Or, “I’m sorry. But the federal government has declared cherries an endangered species. I’m not allowed to give you your pie back. It was very tasty, though.”

How much could this electronic pie be worth anyway… if you have to pay someone to eat it for you? Imagine the automobile you have to pay someone to drive away. Or the rental unit you have to pay someone to live in.

When you have to pay someone to take it off your hands, you can imagine how much your money is really worth. And when your bank – or the Deep State – wants to confiscate your money, who will stop it?

At least if you have your money in cold, hard cash, they will have to come and physically get it from you. When it is “in the bank” – existing as nothing but electronic account balances – all they have to do is push a button.

Once it’s all numbers in a computer, they won’t even have to point their guns at you anymore. Then it will be possible to rub out your money savings by simply pushing a button on a computer keyboard. At that juncture you’d better not be too uppity, citizen.

Cartoon by Chappatte

That’s what happened in Cyprus. The banks were going to the wall. So, they confiscated deposits to help make themselves whole again. Who will stop the same thing from happening in America?

The judge the Deep State appointed? The police on the Deep State’s payroll? The politicians the Deep State bought and paid for?

When cash is outlawed… only outlaws will have cash. And we intend to be among them.

Chart by: Deutsche Bank

Chart and image captions by PT

The above article originally appeared at the Diary of a Rogue Economist, written for Bonner & Partners. Bill Bonner founded Agora, Inc in 1978. It has since grown into one of the largest independent newsletter publishing companies in the world. He has also written three New York Times bestselling books, Financial Reckoning Day, Empire of Debt and Mobs, Messiahs and Markets.

  • Upvote 1
Link to comment
Share on other sites

http://wolfstreet.com/2016/02/18/war-on-cash-escalates-cash-lovers-fight-back-germany-japan/

good comments after the article

As War on Cash Escalates, Cash Lovers Fight Back

by Don Quijones • February 18, 2016

“It would be fatal if citizens got the impression that cash is gradually taken away from them”: Bundesbank President Weidman.

By Don Quijones, Spain & Mexico, editor at WOLF STREET.

Over the last couple of days, bureaucrats at the European Commission and European Central Bank have expressed a keen interest in withdrawing the €500-note from circulation – barely a week after former Standard Chartered CEO Peter Sands published a report calling for the exact same measure. Allegedly the currency of choice for organized crime outfits around the world, the so-called “Bin Laden bill,” accounts for close to a third of the total amount of cash in existence in the Eurozone.

Then on Tuesday, Larry Summers, in an effort to keep his name in the media by hook or crook, called for the death of the $100 bill, though he lamented that removing existing notes was probably “a step too far”:

But a moratorium on printing new high denomination notes would make the world a better place. In terms of unilateral steps, the most important actor by far is the European Union. The €500 is almost six times as valuable as the $100. Some actors in Europe, notably the European Commission, have shown sympathy for the idea and European Central Bank chief Mario Draghi has shown interest as well.

We have warned for over two years (here, here, here and here) that a loose, albeit powerful, coalition of governments, central banks, big banks, credit card companies, fintech firms, NGOs, and large corporations seeks to pull the plug on cash, for their own disparate motives.

Those motives include sustaining and even intensifying the central banks’ nightmarish experiment with negative interest rates, increasing public dependence on big banks, destroying the last vestiges of personal financial freedom and anonymity, expanding government surveillance of and control over the economy, and in the case of credit card companies and fintech firms, doing away with their biggest competitor, physical currency.

The powers that want to kill off cash already have vital technological and generational trends firmly on their side, as a result of which cash’s days as a commonly used payment method may well be numbered anyway. They also have the added bonus of widespread public ignorance, apathy, and disinterest.

Yet despite all the factors stacked in the favor of cash’s would-be executioners, there is a danger of overstating their prospects. All too often we hear about the countries in Europe and elsewhere that are furthest along the path toward a completely cashless existence — countries with high levels of public trust in public institutions such as Denmark, Sweden, Australia and Singapore. By contrast, we hardly ever hear about countries where public trust is low in government and financial institutions and physical cash is still revered. They include many of the nations of the Global South as well as two of the world’s biggest, most advanced economies, Germany and Japan.

In Germany, recent government proposals to ban cash payments above €5,000 have triggered a fierce public backlash, reports The Guardian. The country’s bestselling newspaper, The Bild, published a scathing open letter on Monday titled “Hands Off Our Cash,” while a broad spectrum of political parties has condemned the proposed measures as an attack on data protection and privacy.

“Cash allows us to remain anonymous during day-to-day transactions. In a constitutional democracy, that is a freedom that has to be defended,” tweeted the Green MP Konstantin von Notz. Even the head of the Bunderbank, Jens Weidmann, criticized the government’s proposals, telling Bild (emphasis added): “It would be fatal if citizens got the impression that cash is being gradually taken away from them.”

According to a recent Bundesbank study, approximately 80% of payments in Germany are made in cash. Even among millennials, two-thirds say they prefer paying in cash to electronic means.

Germany’s neighbor to the south, Austria, has similar reservations about the EU’s plans to suppress cash. The Deputy Economy Minister Harald Mahrer recently said that Austrians should have the constitutional right to protect their privacy.

“We don’t want someone to be able to track digitally what we buy, eat and drink, what books we read and what movies we watch,” Mahrer said on Austrian public radio station Oe1. “We will fight everywhere against rules” including caps on cash purchases, he said.

Meanwhile, in tech-obsessed Japan, the country that first popularized mobile wallets and smartphones, cash is king. It is offered and excepted reverentially even when paying for groceries. Every ¥10,000-note is treated with utmost care. As a rule, they’re pristine. Demand for cash remains solid, to the increasing consternation of global credit card companies. In a 2013 report, MasterCard estimated that 38% of the total value of the country’s retail transactions were in cash. That’s almost twice the rate in the U.S. and five times the rate in France.

At ¥90 trillion ($885 billion), or about a fifth of gross domestic product, the value of banknotes in circulation is the highest in the world as a proportion of the economy. Indeed, many small businesses — including two of Tokyo’s 13 restaurants with the highest rating of three stars in the famed Michelin guide — don’t even take plastic, the Wall Street Journal reported a couple of years ago.

It’s impossible to identify, at least with any great precision, the exact reasons for two of the world’s most advanced economies’ continued love affair with cash. In Japan safety appears to play an important role, claims the FT. Given that muggings are rare, people feel quite safe carrying around the equivalent of hundreds of dollars in their pockets or handbags. According to a recent survey in Germany, many people believe that using cash is a better way of keeping track of their personal finances as well as protecting their privacy and anonymity.

As the survey points out, the real point isn’t so much that Germans love cash. It’s that they loathe consumer debt. This is one thing that the people of Japan and Germany both have in common, as is their relatively fresh memory of economic crises and brutally repressive political dictatorships. Perhaps this partly explains their reluctance to embrace some of the more dystopian implications of a cashless society.

But at the very least it may serve as a rallying call for cash lovers around the world as well as a timely reminder that the global technocratic dream of a cashless nirvana is by no means a foregone conclusion. By Don Quijones, Raging Bull-****.

The war on cash has been escalating. But now there’s the first major offensive. Read… It’s Official: Cash is Now Public Enemy Number One

16 comments for “As War on Cash Escalates, Cash Lovers Fight Back”

Michael February 18, 2016 at 9:38 am

Because cash works when the stupid computers do not. I love it because the bankers do not get a slice of the transaction like lamprey. When I shop at mom and pop stores I always pay cash. Cash in your pocket will always trump a credit card that may or may not be accepted.

Reply Spencer February 18, 2016 at 10:29 am

Who the hell are these zombies to tell us how to live our lives. Faceless bastards run our country, and we let them. Screw them and their useless plan for us! Cash is king.

Reply no bull February 18, 2016 at 2:00 pm

Well said. Electronic payment leaves a complete trail from time of purchase to where and what. They already control us forcing public repayments to arms dealers only necessary because the elite start wars. The fed reserve and bank of england even allow private individuals to print out of freshair public money to enslave its people. Bull **** from start to finish!

Reply no bull February 18, 2016 at 2:07 pm

And has anyone noticed that shops dont supply half the stuff available online. Then when they give you change of your £20 its often in coins to further inconvenience the customer. They always say sorry we are out of £1 coins! This is no accident.

Reply Louis February 18, 2016 at 10:29 am

The biggest problem with eliminating cash might not be privacy, though it is nonetheless a valid concern, but the costs–does anyone really think that there wouldn’t be fees involved?

go to the link to read more

  • Upvote 1
Link to comment
Share on other sites

Next, in order to do these cashless transactions, one will have to have the mark.

You've already got it: cell phone and chipped cards..

i was gonna suggest all following this thread research the Rocky Mountain Hour, but it seems to be wiped from the net.

Edited by flatdawg
  • Upvote 1
Link to comment
Share on other sites

http://investmentresearchdynamics.com/the-war-on-cash-is-irrelevant-if-you-own-gold-and-silver/

 

The War On Cash Is Irrelevant If You Own Gold And Silver
 

The fear porn headlines are beginning to flood the alternative media blogs.  Everyone is warning about the growing “war on cash” and negative interest rates.  Yes, it’s inevitable and all the reasons why Governments prefer a digital currency to cash are obvious.  First foremost is that it is the bridesmaid to the Totalitarian creep engulfing our system.

But lost in this fog of fear is the obvious alternative:  gold and silver.  Worried about the elimination of $100 bills because it makes it harder to accumulate and safekeep meaningful amounts of cash?  An ounce of gold stores a lot more wealth than a $100 bill. Currently one roll of silver eagles is worth more than three $100 bills.

Negative interest rates?  Big deal.  Over long periods of time the relative value of gold accelerates vs. all other currencies when real rates are negative.  When the Fed takes nominal rates negative the price of gold/silver will begin to go parabolic.  Will that happen immediately?  Of course not.  The Fed will try to cap the price movement of gold with B-52 payloads full of paper gold.  When this happens, take as much cash out of the banking system as possible and convert it into physical gold and silver bullion coins.

Will the Government try to confiscate gold and silver?  The promoters of this hypothesis have glaringly failed to study the facts.   Yes, the Government decreed it to be illegal to use gold bullion coins as currency but it never embarked on an effort to “confiscate” private gold holdings.  In fact, other than a few idiots who took their gold to the bank and turned it in for cash, the only gold the Government “confiscated” was gold that had been found in abandoned safe deposit boxes.

FURTHERMORE, the possession and use of silver as a currency was never outlawed.  Please study the facts on what happened before you promote or buy into highly misleading or false tales about gold “confiscation.”

Whether or not the Government ever revives a moratorium on the use of gold as a currency or on its outright ownership is, quite frankly, irrelevant.  There will ALWAYS be a private market in which gold will freely exchange hands for like value.  Gold and silver have endured over 5,000 years as legitimate currencies.   The  United States has been in existence for roughly 240 years.  I think I know which of the two has a better probability of surviving the economic and geopolitical hurricane that is approaching.

The rampant proliferation of “war on cash / negative interest rate” warnings are little more than the childish rants of alternative media propaganda artists.   It’s like a repetitive announcement that the earth is round and circles the sun.  Yes, we know that the Government is going to digitize the currency system and take interest rates negative in an attempt to channel bank balances into consumption or the stock market or Treasury bonds.

But whatever measures the Government takes to implement capital controls and increasingly exert more control over your life can be offset if you move as much cash as possible out of the system now and into precious metals.

 

There is a Silver Lining

  • Upvote 1
Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
 Share

  • Recently Browsing   0 members

    • No registered users viewing this page.


  • Testing the Rocker Badge!

  • Live Exchange Rate

×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.