Originally posted by: USASoccer War on drugs = one of the biggest failures in the last 90 or so years. I couldn't agree with you for. Now back to somehow getting silver and platinum to go higher...
War on poverty, no child left behind. . .
Funding failing programs with printed money is good for the PMs.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
"The chart above shows is that if, and when, a run on physical cash begins, there will be roughly $1 dollar in physical to satisfy $10 dollars in savers' claims, a ratio which drops to 20 cents of "deliverable" cash if the $100 bill is taken out of circulation."
If customers are smart enough to withdraw even 15% of all bank deposits, there is nowhere near enough cash to give them. The only way a run on the banks caused by NIRP can be avoided is to first remove the cash option.
Start with the $100 bills.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
"The war on cash (if carried out and $100s and $50s are eliminated), will increase demand for physical gold and silver coins.
Best bet: XF/AU Franklin 50c. ASEs, and American Gold Eagles (probably 1 oz and 1/10 oz.)"
Just do it and keep some cash, 100 of each denomination of bills up to 20's. All it takes is a spark and the ATM's and banks are out of cash within a few hours.
Your cash will give you considerable leverage when the time comes. The easiest way to do this is to just put away the 5's and 10's from your pocket money till you get a hundred of them and throw a few 20's in the bag as you go along. the 1's are easy. It took me about a year and a half to get my pile put together. The nice part is you can dip into your stash if you need and just take your time rebuilding what you took out.
The xf/au frankies are very good (I went with the au's) as are the ase's and 1/10's. These should be the foundation of any stack. Was at the b&m last week and while I was there a guy walked in and plunked a tube of ozer age's on the counter and he was getting cash.
Originally posted by: ebaytrader The vast majority of Bens in circulation are for ex-USA transactions (they're overseas, and not here at home). Weird, eh?
Probably foreign central banks and individuals hoarding large amounts of dollars. If there was still a $1000 note it would be in higher demand there as well.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Originally posted by: TwoSides2aCoin Called another dealer for those National Parks Quarters today. This guys' sidekick is an A hole. Similar to a B whole. No relation to a buck or a stud. More like a rectum.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I think cash works way better when trying to stick to a budget. Make a budget for the month, take out cash every week or every two weeks for your budgeted expenses. Don't use a credit card. Don't take out loans. Pay for everything with cash and don't spend a dime more.
Digital currency and credit cards make it way too easy to spend more than you have. That includes debit cards and PayPal. Digital transactions are the reasons so many people live paycheck to paycheck.
I use cash for everything I can. The only time I use a debit card is to get cash from an ATM or in an emergency. The only time I use a credit card is when they don't accept PayPal and then I pay it immediately (That day). I have PayPal linked directly to my checking and I treat it like cash when it comes to budgeting.
I love the convenience of electronic currency. I hate electronic debt. Personally, I think it would be a personal finance disaster for many people if they eliminated cash.
I will be paying for a $1,700 transmission repair on Monday with $100 bills Does this make me suspicious? I live in a rural location. Nobody blinks an eye when I make a withdrawal and they don't seem to mind when I pay with $100's.
Not yet, but helps to put the EU on its own deathbead. LOL.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
". . . in a purely digital world it would be impossible to withdraw physical money should people believe that their bank (or the banking system as a whole) was at risk of collapse. This could potentially lock people on board a sinking ship, or at least remove the ability of people to make their own judgments and vote with their monetary feet."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
". . . in a purely digital world it would be impossible to withdraw physical money should people believe that their bank (or the banking system as a whole) was at risk of collapse. This could potentially lock people on board a sinking ship, or at least remove the ability of people to make their own judgments and vote with their monetary feet."
Making all transactions digital would make it possible for the quasi-governmental banking system to fund whatever idea or purpose that they wished, with no possibility of financial collapse and zero need for accountability.
I can't think of a more efficient way to run a totalitarian regime.
Q: Are You Printing Money? Bernanke: Not Literally
@jmski52 said: ". . . in a purely digital world it would be impossible to withdraw physical money should people believe that their bank (or the banking system as a whole) was at risk of collapse. This could potentially lock people on board a sinking ship, or at least remove the ability of people to make their own judgments and vote with their monetary feet."
Making all transactions digital would make it possible for the quasi-governmental banking system to fund whatever idea or purpose that they wished, with no possibility of financial collapse and zero need for accountability.
I can't think of a more efficient way to run a totalitarian regime.
One of the hidden agendas: Force people to spend by taking interest rates negative. Controlling the interest paid (or lost) on the only money game in town provides control on whether people save or spend. "Should I leave it in the bank and lose money or spend it now before it's worth less?" I like it better having the option of storing it in my mattress.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
wings rule is correct , structuring the deposits is probably more detrimental than just depositing the whole thing. By doing this, you basically are admitting you know the law, but are avoiding it. trust me the banks have way of knowing this by overall activity. I try to buy large collections with check when possible, but sometimes families want cash . I just go over to the bank and get it out when needed. I have a legitimate business and everything is reportable, so its really not a problem. Honestly, sometimes I purposely break the 10k rule on getting cash out(even if the collection is say 9k) , just to keep the powers that be from even thinking I'm structuring, etc.
@cohodk said:
People dont spend with zero or low rates.
The FED has finally realized this. Euro is starting to come around also.
I didn't say zero or low rates. I said negative rates.
Take away the cash withdrawal option by abolishing cash and you have ONLY two choices when it comes to your money: pay the bank to hold your digital money (negative interest rates) or spend it. You gonna pay the bank to hold your digital money?
No more cash allows the FED to control spending with their control of interest rates paid on deposits. It will give them control of money velocity, something they desperately want in their "toolbox." Abolishing cash is all about control.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Negative rates also do not promote spending as the ECB is finally realizing.
When people see their nest egg shrinking due to negative rates or fees the reduce spending further to preserve what they have.
Yes, people would rather hold cash and have the bank take a portion than spend it on consumables, especially when they have all the consumables they want. The FED realized this several years ago but the ECB resisted. The FEDs hands were tied due to ECB ignorance, but finally the FED said enough is enough and has started to raise rates. The ECB will follow.
A slow and steady rise in rates will not harm the debt markets and will get the economy moving forward. I've been preaching this for years, but now "they" finally listen.
@cohodk said:
Negative rates also do not promote spending as the ECB is finally realizing.
Yes, people would rather hold cash and have the bank take a portion than spend it on consumables, especially when they have all the consumables they want. The FED realized this several years ago but the ECB resisted. The FEDs hands were tied due to ECB ignorance, but finally the FED said enough is enough and has started to raise rates. The ECB will follow.
BS. Next you're gonna claim rising/falling mortgage rates have no affect on the number of home buyers. LOL.
Current affect of negative rates on spending is irrelevant, savers still have the "cash under the mattress" option by freely withdrawing their savings. Different world when that is taken away and there is no longer such a thing as cash. Throwing "consumables" into the equation is just another one of your "distractions."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
It really shouldn't be a central bank's option as to whether to raise or lower rates. There isn't really a reason for a central bank to exist. They're just a middleman that we can do without.
Q: Are You Printing Money? Bernanke: Not Literally
@cohodk said:
Derryb, you know nothing about economics, fiscal policy and intermarket relationships. Your incessant desire to embarrass yourself is baffling.
You really have no idea how this works.
RT, is that you? LOL.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
"So Goodfriend comes up with a new concept called the “flexible market-determined deposit price of paper currency.” (Seriously, I’m not making this up; you can find it in Section 5B of his paper.) In plain English, this means the “money” in your bank account and the “money” in your purse or wallet would be like two different kinds of currency. There would be an exchange rate between the two, just as there is an exchange rate between dollars and euros. The Fed could set this exchange rate at whatever level it wanted and would not be obligated to “defend” that rate at any particular level.
What this means is if you go to the bank and withdraw $1,000, the bank might only give you $980 in cash because of the “exchange rate” between your bank account and cash. Or if you deposit $1,000 in cash, the bank might only credit your bank account $980 because of the same “exchange rate” between your cash and the bank account balance. In short, it’s a way to impose negative interest rates on physical cash."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Great idea derryb! Up to $1000, face for face, 1000-10000, pay a small percentage, say 0.2% "transaction fee"
Those fancy big shots with bundles and duffles of 100s, well, they gonna pay their own "security" fee of 1-5% or more, to have the authorities make sure they ain't stealing from someone, or doing some other crime that makes it necessary for them to deal in huge amounts of cash money. Think about it, why do they need to deal with millions in CASH? No good reason, dealing in 6 figures or more in cash, they're hiding something from someone for the purpose of cheating.
@Baley said:
Great idea derryb! Up to $1000, face for face, 1000-10000, pay a small percentage, say 0.2% "transaction fee"
Those fancy big shots with bundles and duffles of 100s, well, they gonna pay their own "security" fee of 1-5% or more, to have the authorities make sure they ain't stealing from someone, or doing some other crime that makes it necessary for them to deal in huge amounts of cash money. Think about it, why do they need to deal with millions in CASH? No good reason, dealing in 6 figures or more in cash, they're hiding something from someone for the purpose of cheating.
You forget that us little, honest guys will pay the same price. I personally like options when it comes to my money. If we do in fact get to continue using cash charging me a fee to deposit or withdraw reduces those options. The suggested transaction fee is nothing more than a tax on your money. . . that has already been taxed as income. And the good news is it gets taxed again when it goes into the bank, again when it comes out and again when it gets spent. Enjoy!
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
So pay the tax for the inconvenience you're causing everybody, or else pay electronically or with a certified check.
It's like the clown who insist on paying their $5000 in parking tickets using pennies. Sure, pay that way, make "your statement", but if you want to pay your bills in pennies, you should have to pay $6000 for being a jerk about it.
@Baley said:
So pay the tax for the inconvenience you're causing everybody, or else pay electronically or with a certified check.
It's like the clown who insist on paying their $5000 in parking tickets using pennies. Sure, pay that way, make "your statement", but if you want to pay your bills in pennies, you should have to pay $6000 for being a jerk about it.
And what about the penalty (transaction fee) when the money gets deposited? All federal checks and many employers require direct deposit. Since your so eager maybe they will devise a plan where you can volunteer to pay the "convenience" fee for the rest of us.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
"So Goodfriend comes up with a new concept called the “flexible market-determined deposit price of paper currency.” (Seriously, I’m not making this up; you can find it in Section 5B of his paper.) In plain English, this means the “money” in your bank account and the “money” in your purse or wallet would be like two different kinds of currency. There would be an exchange rate between the two, just as there is an exchange rate between dollars and euros. The Fed could set this exchange rate at whatever level it wanted and would not be obligated to “defend” that rate at any particular level.
What this means is if you go to the bank and withdraw $1,000, the bank might only give you $980 in cash because of the “exchange rate” between your bank account and cash. Or if you deposit $1,000 in cash, the bank might only credit your bank account $980 because of the same “exchange rate” between your cash and the bank account balance. In short, it’s a way to impose negative interest rates on physical cash."
Don't you think free market competition will eliminate this so called negative interest rate on physical cash? One thing I have seen in free market economies is that stupid ideas like this are eliminated by competition. The bank down the street needs deposits so it decides to increase the interest rate. Everyone rushes to deposit funds in the bank with more favorable rates. It's pretty much how the system operates now in my small town. One local credit union pays .5% higher than all the commercial banks and they are winning.
Ideas like the one proposed may work in countries with less free market capitalism but I don't think it would fly in the U.S. Some entity would step in to pay depositors a fair amount for the use of their funds and banks would have to change to compete. It happened to banks when mutual funds came on the scene in the late 70's and early 80's. Everyone stopped depositing money in the banks and banks were forced to come up with competitive products with higher rates.
Only one problem with the free market competition argument - the proposal for a bank account/cash exchange rate is based on "The FED could set this exchange rate at whatever level it wanted." This removes the "vote with your feet, and your mind, and your hands, and your dollars" option.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Well, someone could just not use it, and not pay it. Of course, not everyone is Entitled to any SS checks or Pension checks or "off he books" PM profits, nor any other Entitlements licit or illicit, so it would be very easy for them to just pack up their stuff and move to where the conditions are better for them, once they find a better 'ville to live and prosper in.
Problem for most is, they want to get the benefits that they feel entitled to (many will claim "they earned it") and keep the roots they've established, without paying the costs associated with maintining their collective behavior, and the costs associated with enforcing the laws against all the crime and other system gaming that those same folks insist on conducting.
@derryb said:
Only one problem with the free market competition argument - the proposal for a bank account/cash exchange rate is based on "The FED could set this exchange rate at whatever level it wanted." This removes the "vote with your feet, and your mind, and your hands, and your dollars" option.
The FED does not control other financial markets or intermediaries outside of the banking system. Another firm will step in to make a profit and banks will get the FED to reverse negative interest rates so they can compete. The FED does not regulate or control the mutual fund industry, the bond market or insurance companies to name a few. They would love for the FED to make a negative interest rate so they could step in and take some of that cheap money that banks have a strangle hold on. It won't work in a free market economy. They have already tried and it always leads to banks wiggling around the rules to try and compete.
Well, someone could just not use it, and not pay it. Of course, not everyone is Entitled to any SS checks or Pension checks or "off he books" PM profits, nor any other Entitlements licit or illicit, so it would be very easy for them to just pack up their stuff and move to where the conditions are better for them, once they find a better 'ville to live and prosper in.
Problem for most is, they want to get the benefits that they feel entitled to (many will claim "they earned it") and keep the roots they've established, without paying the costs associated with maintining their collective behavior, and the costs associated with enforcing the laws against all the crime and other system gaming that those same folks insist on conducting.
So, I'll take that to mean you have no problem with depositing $1000 in the bank but only getting credit for $980 of it. Personally, I feel that if I deposit $1000 into my bank account I should be able to get the full $1000 back when I want it. . . but that's just me.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
@derryb said:
Only one problem with the free market competition argument - the proposal for a bank account/cash exchange rate is based on "The FED could set this exchange rate at whatever level it wanted." This removes the "vote with your feet, and your mind, and your hands, and your dollars" option.
The FED does not control other financial markets or intermediaries outside of the banking system. Another firm will step in to make a profit and banks will get the FED to reverse negative interest rates so they can compete. The FED does not regulate or control the mutual fund industry, the bond market or insurance companies to name a few. They would love for the FED to make a negative interest rate so they could step in and take some of that cheap money that banks have a strangle hold on. It won't work in a free market economy. They have already tried and it always leads to banks wiggling around the rules to try and compete.
Only one problem. When non banks become banks they fall under FED regulatory control.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I guess I don't understand your statement. If the FED regulated my commercial bank to charge me $20 to deposit $1,000 or charge me interest to keep my money in the bank, I would put my savings in a money market mutual fund and say goodbye to the FDIC insured bank. This is just one example of how I can choose what to invest my cash/money in. The possibilities are endless.
The FED does not control money market mutual funds yet they serve the same purpose. The beauty of the free market economy is that the government cannot stop the market. Funds naturally go to the places that pay the most return for the given level of risk. This does not happen in other "controlled" economies and that's why negative interest rates work in those countries differently than the U.S.
Free market capitalism not only gives everyone the opportunity to generate wealth, it also limits what the government can control. It's kind of like that game at Chuck E Cheese where you try and smash a mole only to have them pop up somewhere else. The government can't stop the free market unless they eliminate the free market.
As another example, look at the governments war on drugs. They have regulated and criminalized the marijuana industry but the money keeps flowing because it is profitable. No matter how hard the government tries to control the market, the market always wins. The best the government can hope for is to slow the market through regulation much like trying to stop your car on an icy road. Just because the government or FED makes a law or a regulation does not mean it will actually work.
As Baley has stated, I vote with my feet and my dollars.
Well, someone could just not use it, and not pay it. Of course, not everyone is Entitled to any SS checks or Pension checks or "off he books" PM profits, nor any other Entitlements licit or illicit, so it would be very easy for them to just pack up their stuff and move to where the conditions are better for them, once they find a better 'ville to live and prosper in.
Problem for most is, they want to get the benefits that they feel entitled to (many will claim "they earned it") and keep the roots they've established, without paying the costs associated with maintining their collective behavior, and the costs associated with enforcing the laws against all the crime and other system gaming that those same folks insist on conducting.
So, I'll take that to mean you have no problem with depositing $1000 in the bank but only getting credit for $980 of it. Personally, I feel that if I deposit $1000 into my bank account I should be able to get the full $1000 back when I want it. . . but that's just me.
I would definitely have a problem with that, if and when it happens. And as I've said, it wouldn't happen to me because I'd have alternatives. Right now, I have no problem at all, because it ain't happening, all that's happening is you saying it may.
@cohodk said:
Is buying an ounce of gold for 1200, then trying to sell it back to the dealer for 1180, the same thing?
Maybe. Is the government now setting the daily price of gold? LOL
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Comments
War on drugs = one of the biggest failures in the last 90 or so years. I couldn't agree with you for. Now back to somehow getting silver and platinum to go higher...
War on poverty, no child left behind. . .
Funding failing programs with printed money is good for the PMs.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
"The chart above shows is that if, and when, a run on physical cash begins, there will be roughly $1 dollar in physical to satisfy $10 dollars in savers' claims, a ratio which drops to 20 cents of "deliverable" cash if the $100 bill is taken out of circulation."
If customers are smart enough to withdraw even 15% of all bank deposits, there is nowhere near enough cash to give them. The only way a run on the banks caused by NIRP can be avoided is to first remove the cash option.
Start with the $100 bills.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
will increase demand for physical gold and silver coins.
Best bet: XF/AU Franklin 50c. ASEs, and American Gold Eagles (probably 1 oz and 1/10 oz.)
will increase demand for physical gold and silver coins.
Best bet: XF/AU Franklin 50c. ASEs, and American Gold Eagles (probably 1 oz and 1/10 oz.)"
Just do it and keep some cash, 100 of each denomination of bills up to 20's. All it takes is a spark and the ATM's and banks are out of cash within a few hours.
Your cash will give you considerable leverage when the time comes. The easiest way to do this is to just put away the 5's and 10's from your pocket money till you get a hundred of them and throw a few 20's in the bag as you go along. the 1's are easy. It took me about a year and a half to get my pile put together. The nice part is you can dip into your stash if you need and just take your time rebuilding what you took out.
The xf/au frankies are very good (I went with the au's) as are the ase's and 1/10's. These should be the foundation of any stack. Was at the b&m last week and while I was there a guy walked in and plunked a tube of ozer age's on the counter and he was getting cash.
Hey Buddy, can you spare an ASE?
The vast majority of Bens in circulation are for ex-USA transactions (they're overseas, and not here at home). Weird, eh?
Probably foreign central banks and individuals hoarding large amounts of dollars. If there was still a $1000 note it would be in higher demand there as well.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Called another dealer for those National Parks Quarters today. This guys' sidekick is an A hole. Similar to a B whole. No relation to a buck or a stud. More like a rectum.
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"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Cash is the currency of freedom
I really liked this article!
Cash is the currency of freedom
I really liked this article!
Me too!
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Europe Proposes Restrictions On Payments In Cash
(conspiracy theory unfolding)
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I enjoyed re-reading this thread.
I think cash works way better when trying to stick to a budget. Make a budget for the month, take out cash every week or every two weeks for your budgeted expenses. Don't use a credit card. Don't take out loans. Pay for everything with cash and don't spend a dime more.
Digital currency and credit cards make it way too easy to spend more than you have. That includes debit cards and PayPal. Digital transactions are the reasons so many people live paycheck to paycheck.
I use cash for everything I can. The only time I use a debit card is to get cash from an ATM or in an emergency. The only time I use a credit card is when they don't accept PayPal and then I pay it immediately (That day). I have PayPal linked directly to my checking and I treat it like cash when it comes to budgeting.
I love the convenience of electronic currency. I hate electronic debt. Personally, I think it would be a personal finance disaster for many people if they eliminated cash.
I will be paying for a $1,700 transmission repair on Monday with $100 bills
Does this make me suspicious? I live in a rural location. Nobody blinks an eye when I make a withdrawal and they don't seem to mind when I pay with $100's.
No, they will blink an eye with suspicion, though, if you were to buy the whole transmission shop with $100 bills.
Agree, fun thread. We all used to so much more loquacious in the old days..
Liberty: Parent of Science & Industry
Is it dead yet?
Knowledge is the enemy of fear
Not yet, but helps to put the EU on its own deathbead. LOL.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
It will be right to rid us of cash. Put the real money back in the people's hands. Silver and gold, baby.
Should Cash Be Abolished?
". . . in a purely digital world it would be impossible to withdraw physical money should people believe that their bank (or the banking system as a whole) was at risk of collapse. This could potentially lock people on board a sinking ship, or at least remove the ability of people to make their own judgments and vote with their monetary feet."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
very good thread, will need to spend more time reading through it.
Many members on this forum that now it cannot fit in my signature. Please ask for entire list.
". . . in a purely digital world it would be impossible to withdraw physical money should people believe that their bank (or the banking system as a whole) was at risk of collapse. This could potentially lock people on board a sinking ship, or at least remove the ability of people to make their own judgments and vote with their monetary feet."
Making all transactions digital would make it possible for the quasi-governmental banking system to fund whatever idea or purpose that they wished, with no possibility of financial collapse and zero need for accountability.
I can't think of a more efficient way to run a totalitarian regime.
I knew it would happen.
One of the hidden agendas: Force people to spend by taking interest rates negative. Controlling the interest paid (or lost) on the only money game in town provides control on whether people save or spend. "Should I leave it in the bank and lose money or spend it now before it's worth less?" I like it better having the option of storing it in my mattress.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
People dont spend with zero or low rates.
The FED has finally realized this. Euro is starting to come around also.
Knowledge is the enemy of fear
wings rule is correct , structuring the deposits is probably more detrimental than just depositing the whole thing. By doing this, you basically are admitting you know the law, but are avoiding it. trust me the banks have way of knowing this by overall activity. I try to buy large collections with check when possible, but sometimes families want cash . I just go over to the bank and get it out when needed. I have a legitimate business and everything is reportable, so its really not a problem. Honestly, sometimes I purposely break the 10k rule on getting cash out(even if the collection is say 9k) , just to keep the powers that be from even thinking I'm structuring, etc.
I didn't say zero or low rates. I said negative rates.
Take away the cash withdrawal option by abolishing cash and you have ONLY two choices when it comes to your money: pay the bank to hold your digital money (negative interest rates) or spend it. You gonna pay the bank to hold your digital money?
No more cash allows the FED to control spending with their control of interest rates paid on deposits. It will give them control of money velocity, something they desperately want in their "toolbox." Abolishing cash is all about control.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Negative rates also do not promote spending as the ECB is finally realizing.
When people see their nest egg shrinking due to negative rates or fees the reduce spending further to preserve what they have.
Yes, people would rather hold cash and have the bank take a portion than spend it on consumables, especially when they have all the consumables they want. The FED realized this several years ago but the ECB resisted. The FEDs hands were tied due to ECB ignorance, but finally the FED said enough is enough and has started to raise rates. The ECB will follow.
A slow and steady rise in rates will not harm the debt markets and will get the economy moving forward. I've been preaching this for years, but now "they" finally listen.
Knowledge is the enemy of fear
BS. Next you're gonna claim rising/falling mortgage rates have no affect on the number of home buyers. LOL.
Current affect of negative rates on spending is irrelevant, savers still have the "cash under the mattress" option by freely withdrawing their savings. Different world when that is taken away and there is no longer such a thing as cash. Throwing "consumables" into the equation is just another one of your "distractions."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Derryb, you know nothing about economics, fiscal policy and intermarket relationships. Your incessant desire to embarrass yourself is baffling.
You really have no idea how this works.
Knowledge is the enemy of fear
It really shouldn't be a central bank's option as to whether to raise or lower rates. There isn't really a reason for a central bank to exist. They're just a middleman that we can do without.
I knew it would happen.
RT, is that you? LOL.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Fortunately I never have to question your identity. Lol
Knowledge is the enemy of fear
Here's a new proposal exposed by Jim Rickards.
"So Goodfriend comes up with a new concept called the “flexible market-determined deposit price of paper currency.” (Seriously, I’m not making this up; you can find it in Section 5B of his paper.) In plain English, this means the “money” in your bank account and the “money” in your purse or wallet would be like two different kinds of currency. There would be an exchange rate between the two, just as there is an exchange rate between dollars and euros. The Fed could set this exchange rate at whatever level it wanted and would not be obligated to “defend” that rate at any particular level.
What this means is if you go to the bank and withdraw $1,000, the bank might only give you $980 in cash because of the “exchange rate” between your bank account and cash. Or if you deposit $1,000 in cash, the bank might only credit your bank account $980 because of the same “exchange rate” between your cash and the bank account balance. In short, it’s a way to impose negative interest rates on physical cash."
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Great idea derryb! Up to $1000, face for face, 1000-10000, pay a small percentage, say 0.2% "transaction fee"
Those fancy big shots with bundles and duffles of 100s, well, they gonna pay their own "security" fee of 1-5% or more, to have the authorities make sure they ain't stealing from someone, or doing some other crime that makes it necessary for them to deal in huge amounts of cash money. Think about it, why do they need to deal with millions in CASH? No good reason, dealing in 6 figures or more in cash, they're hiding something from someone for the purpose of cheating.
Liberty: Parent of Science & Industry
You forget that us little, honest guys will pay the same price. I personally like options when it comes to my money. If we do in fact get to continue using cash charging me a fee to deposit or withdraw reduces those options. The suggested transaction fee is nothing more than a tax on your money. . . that has already been taxed as income. And the good news is it gets taxed again when it goes into the bank, again when it comes out and again when it gets spent. Enjoy!
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
So pay the tax for the inconvenience you're causing everybody, or else pay electronically or with a certified check.
It's like the clown who insist on paying their $5000 in parking tickets using pennies. Sure, pay that way, make "your statement", but if you want to pay your bills in pennies, you should have to pay $6000 for being a jerk about it.
Liberty: Parent of Science & Industry
And what about the penalty (transaction fee) when the money gets deposited? All federal checks and many employers require direct deposit. Since your so eager maybe they will devise a plan where you can volunteer to pay the "convenience" fee for the rest of us.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Don't you think free market competition will eliminate this so called negative interest rate on physical cash? One thing I have seen in free market economies is that stupid ideas like this are eliminated by competition. The bank down the street needs deposits so it decides to increase the interest rate. Everyone rushes to deposit funds in the bank with more favorable rates. It's pretty much how the system operates now in my small town. One local credit union pays .5% higher than all the commercial banks and they are winning.
Ideas like the one proposed may work in countries with less free market capitalism but I don't think it would fly in the U.S. Some entity would step in to pay depositors a fair amount for the use of their funds and banks would have to change to compete. It happened to banks when mutual funds came on the scene in the late 70's and early 80's. Everyone stopped depositing money in the banks and banks were forced to come up with competitive products with higher rates.
Ever hear of regulation Q and DIDMCA?
Regulation_Q
my point exactly, hch.
don't like "the new rule"? vote with your feet, and your mind, and your hands, and your dollars.
or feel entitled and go ahead and bch and moan about 'them'. Either way, make your choices and own 'em.
Liberty: Parent of Science & Industry
Only one problem with the free market competition argument - the proposal for a bank account/cash exchange rate is based on "The FED could set this exchange rate at whatever level it wanted." This removes the "vote with your feet, and your mind, and your hands, and your dollars" option.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Well, someone could just not use it, and not pay it. Of course, not everyone is Entitled to any SS checks or Pension checks or "off he books" PM profits, nor any other Entitlements licit or illicit, so it would be very easy for them to just pack up their stuff and move to where the conditions are better for them, once they find a better 'ville to live and prosper in.
Problem for most is, they want to get the benefits that they feel entitled to (many will claim "they earned it") and keep the roots they've established, without paying the costs associated with maintining their collective behavior, and the costs associated with enforcing the laws against all the crime and other system gaming that those same folks insist on conducting.
Liberty: Parent of Science & Industry
The FED does not control other financial markets or intermediaries outside of the banking system. Another firm will step in to make a profit and banks will get the FED to reverse negative interest rates so they can compete. The FED does not regulate or control the mutual fund industry, the bond market or insurance companies to name a few. They would love for the FED to make a negative interest rate so they could step in and take some of that cheap money that banks have a strangle hold on. It won't work in a free market economy. They have already tried and it always leads to banks wiggling around the rules to try and compete.
@Baley said:
So, I'll take that to mean you have no problem with depositing $1000 in the bank but only getting credit for $980 of it. Personally, I feel that if I deposit $1000 into my bank account I should be able to get the full $1000 back when I want it. . . but that's just me.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Only one problem. When non banks become banks they fall under FED regulatory control.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I guess I don't understand your statement. If the FED regulated my commercial bank to charge me $20 to deposit $1,000 or charge me interest to keep my money in the bank, I would put my savings in a money market mutual fund and say goodbye to the FDIC insured bank. This is just one example of how I can choose what to invest my cash/money in. The possibilities are endless.
The FED does not control money market mutual funds yet they serve the same purpose. The beauty of the free market economy is that the government cannot stop the market. Funds naturally go to the places that pay the most return for the given level of risk. This does not happen in other "controlled" economies and that's why negative interest rates work in those countries differently than the U.S.
Free market capitalism not only gives everyone the opportunity to generate wealth, it also limits what the government can control. It's kind of like that game at Chuck E Cheese where you try and smash a mole only to have them pop up somewhere else. The government can't stop the free market unless they eliminate the free market.
As another example, look at the governments war on drugs. They have regulated and criminalized the marijuana industry but the money keeps flowing because it is profitable. No matter how hard the government tries to control the market, the market always wins. The best the government can hope for is to slow the market through regulation much like trying to stop your car on an icy road. Just because the government or FED makes a law or a regulation does not mean it will actually work.
As Baley has stated, I vote with my feet and my dollars.
I would definitely have a problem with that, if and when it happens. And as I've said, it wouldn't happen to me because I'd have alternatives. Right now, I have no problem at all, because it ain't happening, all that's happening is you saying it may.
Liberty: Parent of Science & Industry
Is buying an ounce of gold for 1200, then trying to sell it back to the dealer for 1180, the same thing?
Knowledge is the enemy of fear
That's a good analogy
Maybe. Is the government now setting the daily price of gold? LOL
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey