John Mauldin Warns of the Efforts Pushing Cashless Society

John Mauldin posted an astounding column opposing the coming cashless society and negative and low interest rates:  http://www.talkmarkets.com/content/economics--politics/monetary-mountain-madness?post=105833&uid=4798

He posted Fed vice Chairman Stanley Fischer's flippant comments:

DR. FISCHER: Well, clearly there are different responses to negative rates. If you’re a saver, they’re very difficult to deal with and to accept, although typically they go along with quite decent equity prices. But we consider all that, and we have to make trade-offs in economics all the time, and the idea is, the lower the interest rate the better it is for investors.

 And Mauldin's response was as follows:

I have to say, reading that last part made my blood boil. For the vast majority of people with savings all over the world, zero or negative rates are not just “very difficult to deal with.” They are in many cases the difference between living with a modicum of dignity and living in abject poverty. Or, if you’re slightly better off, you may feel forced to take too much risk in your portfolio at the very time of your life when you should be taking few risks. But that’s okay with Dr. Fischer, because negative rates also bring “quite decent equity prices.” [Emphasis mine]

After showing that the Fed is sacrificing mom and pop America, the retirement system and the insurance system, he goes on to warn that the Fed was seriously talking about negative rates at its Jackson Hole annual meeting:

Having established that it has legal authority to use NIRP, the Fed can now develop specific plans for doing so.
What better way to learn the NIRP ropes than by huddling with fellow central bankers who have actually taken the plunge? Jackson Hole gave them the chance. And sure enough, high on the agenda was that session on “Negative Nominal Interest Rates.”
The lead presenter in that session, Marvin Goodfriend of Carnegie Mellon University, is an unabashed cheerleader for NIRP. In the first paragraph of the first section of his paper, he says that he “… makes the case for unencumbering interest rate policy so that negative nominal interest rates can be made freely available and fully effective as a realistic policy option in a future crisis.”

 Then Mr Mauldin made this astonishing statement:

Again, remember that Jackson Hole is not a summer-long retreat. Whatever makes it onto the agenda is there for good reason. The attendees didn’t discuss NIRP for its entertainment value. They were carefully considering its effects and mulling over the practical aspects of implementing it. They also had the Group of Thirty leader in the room, ready to inform the big banks what was brewing.
Obviously this is all conjecture on my part, but I think it fits. I believe the Fed wants to have NIRP in its toolbox when the next recession hits. Having NIRP at the ready doesn’t mean they will actually use it, but it does mean they could. The previously unthinkable is now fully thinkable.

Wake up America, the previously unthinkable is now thinkable. 

Negative Interest Rates And The War On Cash (Part 2)

http://www.talkmarkets.com/content/global-markets/negative-interest-rates-and-the-war-on-cash-part-2?post=105362&uid=4798


From Talkmarkets is an article that will anger you and make you aware of the dangers of totalitarian banking. If this doesn't get under your skin, nothing will about this globalist cabal and what they want.

From the site:


Even in relatively untroubled countries, like the UK, it is becoming more difficult to access physical cash in a bank account or to use it for larger purchases. Notice of intent to withdraw may be required, and withdrawal limits may be imposed ‘for your own protection’. Reasonsfor the withdrawal may be required, ostensibly to combat money laundering and the black economy:

It’s one thing to be required by law to ask bank customers or parties in a cash transaction to explain where their money came from; it’s quite another to ask them how they intend to use the money they wish to withdraw from their own bank accounts. As one Mr Cotton, a HSBC customer, complained to the BBC’s Money Box programme: “I’ve been banking in that bank for 28 years. They all know me in there. You shouldn’t have to explain to your bank why you want that money. It’s not theirs, it’s yours.”

In France, in the aftermath of terrorist attacks there, several anti-cash measures were passed, restricting the use of cash once obtained:

French Finance Minister Michel Sapin brazenly stated that it was necessary to “fight against the use of cash and anonymity in the French economy.” He then announced extreme and despotic measures to further restrict the use of cash by French residents and to spy on and pry into their financial affairs.
These measures…..include prohibiting French residents from making cash payments of more than 1,000 euros, down from the current limit of 3,000 euros….The threshold below which a French resident is free to convert euros into other currencies without having to show an identity card will be slashed from the current level of 8,000 euros to 1,000 euros. In addition any cash deposit or withdrawal of more than 10,000 euros during a single month will be reported to the French anti-fraud and money laundering agency Tracfin.

Tourists in France may also be caught in the net:

France passed another new Draconian law; from the summer of 2015, it will now impose cash requirements dramatically trying to eliminate cash by force. French citizens and tourists will only be allowed a limited amount of physical money. They have financial police searching people on trains just passing through France to see if they are transporting cash, which they will now seize.

I would suggest that anyone who cares about privacy and freedom seek to understand the issues behind the article and read the entire 4 pages. 

Riksbank: Cash Must Be A Protected Legal Right For Good Reason

http://www.talkmarkets.com/content/currenciesforex/riksbank-cash-must-be-a-protected-legal-right-for-good-reason?post=94939&uid=4798

From the article:

Sweden's Riksbank says that cash must be a protected legal right. The central bank of Sweden fears that people will be locked out of the banking system, something I have warned could happen. It is nice to hear it from a central bank, though. A discussion of the shadow economy follows at the end of this article. I am sure that the contribution to GDP by the shadow economy, both legal and illegal, is massive. I am sure that this fact is not lost on central bankers.
Now I can point to the Riksbank as my friends and relatives scoff, and say, see, I told you so. I have been telling them that the existence of cash is important and the talk of banishing it is dangerous and cannot be ignored!
And I have been speaking to the subject of privacy, as all transactions will be tracked in a cashless society. Apparently that is a concern of the Riksbank as well.
Considering that the central bank of Sweden is at the forefront of negative interest on bank reserves, pushing inflation higher for the last three months in a row, it is astounding to me that it wants to protect cash. Most bankers who advocate negative interest on reserves also advocate a cashless society, fearing bank runs. And that could happen if the plunge into negativity is deep enough to be passed on to consumers, and if those consumers believe that those costs are harder to bear than the loss of convenience in maintaining the account.
So, this is a significant political statement on the part of the Riksbank, to seek protection for cash.

 Like the Pay Cash Only Movement page:  https://www.facebook.com/Pay-Cash-Only-Movement-1486591244977682/

The War On Paper Currency Officially Begins: ECB Ends Production Of €500 Bill

http://www.talkmarkets.com/content/news/the-war-on-paper-currency-officially-begins-ecb-ends-production-of-500-bill?post=93498&uid=4798


From the link:

In other words, if overnight the €307 billion worth of €500 bills were eliminated, the notional value of the entire amount of European physical currency in circulation would decline by 30% to €700 billion!

And there you have it: while it may not be banning all European cash outright, we are confident the ECB would be delighted if one third of it was to start, while pretending to be fighting financial crime, terrorism, corruption and drug dealers. 

Of course, what Europe would be truly doing is setting the scene for ever more aggressive NIRP, and by removing the highest denomination bank notes, it would make evading negative that much more difficult and costly (albeit would certainly favor gold).

The ECB is failing. Fight Cashlessness in Europe so it won't come here!


 Like the Pay Cash Only Movement page:  https://www.facebook.com/Pay-Cash-Only-Movement-1486591244977682/

Real Helicopter Money, Defined Precisely, Can Overcome a Cashless Society

http://www.talkmarkets.com/content/bonds/eric-lonergan-precisely-defines-helicopter-money?post=92811&uid=4798

This is my article. From the site:

...Helicopter money has been called QE for the people but that is not quite right. I will list some important points I have found from reading Lonergan regarding this subject. Turns out, HM is the opposite of QE. It has been called QE for the people, but is quite superior to QE...
...I hope this love affair with negative is not a sinister plan on the part of some in central banking. If it is sinister, we will have to all shout louder in our commitment to helicopter money, but understand clearly what it is and what it does...

 Like the Pay Cash Only Movement page:  https://www.facebook.com/Pay-Cash-Only-Movement-1486591244977682/

Against Currency Prohibitionism - Alt-M

Against Currency Prohibitionism - Alt-M



Even this CATO author, Larry White, though pretty much against getting rid of cash, is mamby pamby about the large denominations. That is disappointing!



Like the Pay Cash Only Movement page:  https://www.facebook.com/Pay-Cash-Only-Movement-1486591244977682/

Relentless Slide Toward Deflation And Negative Nominal Rates

http://www.talkmarkets.com/content/us-markets/preserve-capital-relentless-slide-toward-deflation-and-negative-nominal-rates?post=84564&uid=4798


From my article:

America is potentially vulnerable to negative nominal rates just like the rest of the world, because the US is reliant on foreign holdings of the dollar to keep it strong and in reserve status. If the dollar is to remain the reserve currency, people will need to want to hold dollars and US bonds will continue to exist in high demand.
And one of the main reasons they would want to hold dollars is because they know America has never defaulted on its bonds. They need that safety. The bonds are not only gold as collateral in derivatives markets, but they are like gold in the backing of the base currency which was once known as the high powered money, not the same as the larger money supply. The discussion below should clarify how little power high powered money, base money, has become these days.
Gold bugs believe that gold is better than treasuries at backing the US dollar, but that treasuries do indeed at least back base money. But they could live and die before their view of gold versus treasuries is verified! And there isn't enough gold to back the currency anyway. Going to a gold standard for base money or especially for all money, would limit dollars and make trade with other nations impossible.

and:

The march toward negative is proving to be the main flaw in the otherwise almost foolproof system designed to protect the banks and treasury bond demand (engineered at least in part by Alan Greenspan). The propensity toward a deflationary scenario seems relentless, in Europe, in Japan and even spoken of by the Fed.
Dr Werners' plan to end the long bond may not work, but a return to a normal economy would be welcome news. Wouldn't it be nice if we had government banks that bypassed the issuance of bonds by the treasury. These banks would offer loans to our government, at positive interest rates. Bonds could be issued for special programs, like for infrastructure as was done with war bonds in World War 2.
And regular treasuries would still back the base money. They would carry higher interest rates, reflecting diminished demand, and return the economy to more normal times. The 1 percent would be forced to pay taxes, so that the deficits would not be so large. But the bonds would not be in demand as collateral, so that would take some of the pressure off demand for them.
That way, when the Fed raises interest rates on the short end, there would be half a chance for long bond rates to go up so banks would lend into the real economy and profit. They certainly are not doing much of that now. We have a little inflation in the US, but in Europe, inflation is negative, meaning real interest rates are going up. Economists want to stimulate with negative nominal rates (real rates + inflation) to offset the rise in real rates.

and:

We are clearly entering a worldwide deflationary cycle, with the slowing of China and US slow growth and the drop for the Baltic Dry Index. If the experiments of the Japanese and Scandinavian nations fail to stimulate, through their negative rates, it will certainly be back to the drawing board. And eliminating cash is not the answer, with too many unknowns being the result.
For me, there are more questions than answers regarding this march toward negativity. In a deflationary scenario, the banking system wants to reward recklessness and punish frugality. But they brought on the frugality along with globalization and lower wages that resulted.
There is nothing wrong with frugality. Only, if everyone is frugal at the same time there are deflationary pressures and slow growth. The Japanese, and US millennials and boomers, and Europeans are frugal. Banker abuse and globalization caused this frugality in most cases. Easy money followed by credit tightening (which is different than money tightening by the Fed) is not good banker PR!

Like the Pay Cash Only Movement page:  https://www.facebook.com/Pay-Cash-Only-Movement-1486591244977682/