Home Finance Negative Interest Rates Impacting a Cashless Society

Negative Interest Rates Impacting a Cashless Society

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Editor’s note: I interviewed Greg Buck this morning on descending interest rates and a cashless society. After discussing the lowering of interest rates, he suggests that the a cashless society is required when interest rates go negative. Once you have to pay the bank to have savings, one would prefer to have cash. But if there’s no cash, there can be no bank runs. He suggests this is one of the main incentives to remove cash.

UPDATE:

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31 COMMENTS

  1. Yep, go cash. By the way, gold is now over A$2,200 a troy ounce. Let’s see it in 6 months. You want to save for your future? What are you going to save your assets in?

    Like Greg said, gold and sliver are not PRESENTLY recognized as money. However, go back through history and it is easy to find many examples where the people quickly re-recognized it as money and precious metals became the money of choice.

    In the future, if someone offered you X amount of declining digital dollars or the equivalent in silver coins, which would you take?

    • Terry, just today on Ed Griffin’s blog (author of Creature from Jekyll Island) he said:

      Good money is something that is so stable in purchasing power over a long period of time that it can be used to measure the value of everything else. It’s like a yardstick. Because its length never changes, it can be used to measure things with different lengths.

      Throughout 5.000 years of history, the only yardsticks that have well served the purpose of measuring monetary value are gold and silver. There are reasons for that, such as the fact that these metals last forever, can be analyzed for purity, can be divided and recombined, and have other qualities of convenience,

      but the primary reason is that, in a free society, the value of gold and silver is not determined by political decree or bank policy. It is determined by the free-market forces of supply and demand.

      • My introduction to silver coil value was when my father was stationed in Germany back in 1954. We had to exchange all silver coins for ‘script’, that is, military paper money that said 10 cents, 25 cents, 50 cents.

        A few of the pilots figured out that the Germans would like to have REAL money to exchange goods for. So when they flew back to the States they would exchange $20 for four rolls of American dimes. Each roll was 50 coins and worth just $5 – but you had 200 dimes to work with. However, those silver dimes could be exchanged for all sorts of things.

        You want a liter of beer, just slide a silver dime across the bar.

  3. I’ve got a ONE HUNDRED TRILLION DOLLAR ZIMBABWEAN NOTE. Couldn’t have here in Oz. We’re sofistikated. We’ll just go cashless and use our sofisikated tecknology….digital economy.

    The banksters have gone full retard..

  4. It is further sinister manipulation of our free will choices by the criminal consortiums

    The Pros and Cons of Moving to a Cashless Society
    https://www.thebalance.com/pros-and-cons-of-moving-to-a-cashless-society-4160702

    Benefits
    Lower crime because there’s no tangible money to steal

    Less money laundering because there’s always a paper trail

    Less time and costs associated with handling paper money as well as storing and depositing it

    Easier currency exchange while traveling internationally

    Disadvantages
    Exposes your personal information to a possible data breach

    If hackers drain your bank account, you’ll have no alternative source of money

    Technology problems can leave you with no access to your money

    The poor and those without bank accounts will have difficulty paying and receiving payments

    Some may find it harder to control spending when they don’t see physical cash leaving their hands

    Banks may start charging fees to compensate for possible negative interest rates

    https://theconversation.com/why-a-cashless-society-would-hurt-the-poor-a-lesson-from-india-79735

  6. The Morrison government’s recent attempt to keep deposits in the banking system by imposing a $10,000 upper cash buying limit is just the first step to keep the money where it can be accessed for bail in.

  7. Cash already comes with a negative return for holding. Keynes said it was unnoticed by most. It’s called inflation and is built into the Ponzi scheme know as cash used today.
    The coins may counter some of these pressures but even the old coppers have a holding cost.

  8. Sadly, nothing new under the sun

    “The modern theory of the perpetuation of debt has drenched the earth with blood, and crushed its inhabitants under burdens ever accumulating.”

    Thomas Jefferson (1743-1826)
    Author of the Declaration of Independence 3rd President of the United States

  9. People, please get involved and sign the petition that is being circulated, to reject the ridiculous draft legislation to outlaw cash payments over $10,000.00. If you allow this to happen, next will be no cash transactions over $2,000.00, then no cash transactions at all.

    When there is no cash, as Greg says, banks will be able to charge any amount of negative interest on your money and because you will not be able to make any transaction outside the banking industry, banks will be able to charge any amount in fees for those transactions.

    So get with it and voice your concerns. If you let the politicians get away with this Bill, don’t complain after the damage is done. It will be too late and life will only get worse. You will really be trampled by a police-state after that.

    If you want to know more about the petition, visit The Citizens Electoral Council site at: http://www.cecaust.com.au This organisation is a minor political party.

  10. Apologies! It is too late to put in a submission regarding the draft legislation to do with cash transactions over $10,000.00. However the petition I referred to, is to put pressure on Canberra to reverse the legislation passed in February 2018, which allows the banks to confiscate your deposits in an attempt to keep those banks afloat, in the event of a financial collapse.

    • Thanks Mal,
      My guess would be that they had to slow the march to “the world credit”, because it is widely known to fall back to barter. Some have been swapping for a long time and the daily park meeting markets will have to be contained or outlawed.
      I think NZ has legislation pending or law that makes offence for a neighbour to give another vegatables from their home garden. Meat is only to be consumed on property of origin without meat inspection mark.
      These bartering outlaws must be crushed before the pin is pulled on the current nation currency system. Sorry money changes, you might have to get some skills(ur welcome ‘arvard gleeners).

        • Excellent thinking outside the usual, although a good neighbour would never.
          I suggest 3 bell chimes(or flushes be they close) to signal the lettuce is ready and then report the disappearance of item as taken by unknown.
          The bullet proofed constabulary can the help plow the next crop looking for evidence.
          Crazy but we on the cusp.

    • Aussiemal
      Thanks I sent info out to many of my friends and contacts and they did not act 🙁
      Petitions are begging and the criminal syndicates called the banksters and the government will proceed regardless with their world-wide agenda with their incremental Fabian approach. to use My will is a better approach but that will not succeed either unfortunately.
      https://mywillaustralia.com/

      You cannot have any government incessantly borrowing money and paying back over $1,000,000,000,000.00 a month just on the interest.
      https://www.abc.net.au/news/2014-06-12/joe-hockey-one-billion-a-month-interest-fact-check/5478480

      Then you have the futures and derivatives which is simply gambling which is making food expensive in third world countries creating starvation. Did you know they even bet on the weather after they have released particulates in the air by aircraft?

  12. Yesterday, I pulled the plastic stopper out of a bottle of Parsnip Wine I made 21 years ago and the first whiff of it was incredible. In Hampshire, UK its nickname was ‘Tanglefoot’. I’ve filtered it into a fresh bottle and have another one to do today. Cheers, Kevin.

  13. Governments still have power to help even if interest rates are zero. They could (shock! horror!) reduce taxation. Not just a small percentage drop here & there, but some rather large scale reductions to the people, and start taxing those multinationals who pay only 1-2% tax on their profits.
    Some services no doubt will need to be reduced, but I’m sure many services within the government could be cut with no real affect on the people.

    Fiat money (that in use in australia since the introduction of decimal currency in1966) only has value fully dependent on people’s confidence in it. Once that confidence goes, it is a quick fall to no value.

  15. Submissions to Treasury on the Currency(Restrictions on Cash) Bill 2019 began with ‘black economy’.
    I had not come across this word till now.

    Somewhat aside to this Bill, I found this link quite compelling reading.
    The link talks of the Russian black economy – “The Judeo-Russian Mafia: From the Gulag to Brooklyn to World Dominion”
    https://www.veteranstoday.com/2019/08/18/khazarian-mafia-rules-israel-put-trump-in-the-white-house-the-khazarian-mafia-keeps-him-there/

  16. Low interest rates screw everything up by allowing zombie investments and businesses to survive and clutter up the landscape at the expense of good ones. Negative rates will destroy the money system as we know it. The clowns running the central banks believe that when something is not working, one needs only to do more of it!

    See https://www.abc.net.au/news/2019-08-26/cash-ban-so-you-pay-the-bank-to-hold-your-money-what-imf-wants/11443646

    and

    https://wolfstreet.com/2019/08/25/the-wolf-street-report-how-even-low-interest-rates-screw-up-the-economy/

  19. Trump’s Brilliant Strategy to Dismember U.S. Dollar Hegemony
    https://www.counterpunch.org/2019/02/01/trumps-brilliant-strategy-to-dismember-u-s-dollar-hegemony/

    Calling the U.S. coup being sponsored in Venezuela a defense of democracy reveals the Doublethink underlying U.S. foreign policy. It defines “democracy” to mean supporting U.S. foreign policy, pursuing neoliberal privatization of public infrastructure, dismantling government regulation and following the direction of U.S.-dominated global institutions, from the IMF and World Bank to NATO. For decades, the resulting foreign wars, domestic austerity programs and military interventions have brought more violence, not democracy.

    In the Devil’s Dictionary that U.S. diplomats are taught to use as their “Elements of Style” guidelines for Doublethink, a “democratic” country is one that follows U.S. leadership and opens its economy to U.S. investment, and IMF- and World Bank-sponsored privatization. The Ukraine is deemed democratic, along with Saudi Arabia, Israel and other countries that act as U.S. financial and military protectorates and are willing to treat America’s enemies are theirs too.

    A point had to come where this policy collided with the self-interest of other nations, finally breaking through the public relations rhetoric of empire. Other countries are proceeding to de-dollarize and replace what U.S. diplomacy calls “internationalism” (meaning U.S. nationalism imposed on the rest of the world) with their own national self-interest.

  23. joke?? are they getting desperate for our cash? https://www.zerohedge.com/health/aussie-cops-now-confiscate-loose-coins-cars-because-safety I honestly thought this was a joke!! Inspector Paul Markson says this Random Coin Testing is “similar to RBT” so they’ll be pulling over cars & searching for loose change! & confiscating it. It will commence on Oct 11 on “undisclosed NSW roads”. (drivers are urged to keep all coins contained securely within the vehicle’s sealed compartments)

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