Macro Voices Discussion Forum

The investment world is full of scam artists and con men, and one of their favorite tricks is to join an investment-related forum like this one, warm up to other users on that forum, then try to run some kind of scam on them. While we do our best to remove any posts we feel are inappropriate we recommend extreme caution when considering investment advice posted by other guests on this, or any other public forum. Read More...

Welcome, Guest
Username: Password: Remember me
Welcome to the Macro Voices Podcast Forum!

Post you comments and questions about specific podcasts here.

TOPIC: The War on Cash

The War on Cash 3 months 1 week ago #1

  • Pepe le Moko
  • Pepe le Moko's Avatar
  • Offline
  • Senior Boarder
  • Posts: 49
  • Thank you received: 4
  • Karma: 4
A new article discussing the war on cash and its implications for privacy.
thelongandshort.org/society/war-on-cash
The UK government does not plan to maintain that right, and is siding with the payments industry. Their position is summed up by economist Kenneth Rogoff in his new book The Curse of Cash. He argues that, apart from facilitating crime and tax evasion, cash hampers central banks from setting negative interest rates. In the absence of cash, everyone must keep their money in the form of digital bank deposits. During recessions central banks could then use the banking system to deliberately corrode people's deposits via negative charges, 'inspiring' them to spend rather than hoard.

My spin is that the war on cash may be aimed at forcing people to spend via negative interest rates for the time being, but it's real long range purpose is to facilitate hyperinflation. Hyperinflation is a deliberate policy of central banks whose intent is to restore "competitiveness" by reducing wages and inflating away debt. Central banks are limited in the amount of money they can print by the physicality of cash. In a cashless society adding zeros to the price of bread or medicine is much easier.

The concept of hording is interesting. The very idea of savings has been recast here as an societal evil that must be wiped out. I remember when a piggy bank was a tool to teach children the value of thrift.
The administrator has disabled public write access.

The War on Cash 3 months 1 week ago #2

  • imaginary numbers
  • imaginary numbers's Avatar
  • Offline
  • Fresh Boarder
  • Posts: 1
  • Karma: 0
The trend is your friend, until it breaks. More oversight (a la Snowdens revelations) more tax, more dependence, less freedom, less independent thought. My hope is for the trend to reverse immediately, but as it stands, I'd be betting that it'll extend for a few more years yet.
The administrator has disabled public write access.

The War on Cash 3 months 1 week ago #3

  • Michael Gebhart
    Michael Gebhart
  • Michael Gebhart's Avatar
  • Offline
  • Junior Boarder
  • Posts: 29
  • Karma: 2
Another Keynesian scheme. Authority is self-serving so the plan favors the political class. It could be used to facilitate helicopter money as the central bank could inject reserves directly into bank accounts if everyone would have to have them. QE isn't going to work in a 5% increase in unemployment rate recession, according to the Fed, without a $4 trillion injection so helicopter money could be on the table.
snip.ly/b9aja#http://powerandmarket.com/...t-an-economic-shock/
Last Edit: 3 months 1 week ago by Michael Gebhart.
The administrator has disabled public write access.

The War on Cash 3 months 1 week ago #4

  • Pepe le Moko
  • Pepe le Moko's Avatar
  • Offline
  • Senior Boarder
  • Posts: 49
  • Thank you received: 4
  • Karma: 4
www.cnbc.com/2015/09/20/fed-raises-possi...-interest-rates.html
Solving the cash problem

Recently, the European Central Bank, as well as Switzerland, Denmark and Sweden, have all enacted negative policy rates. Cutting the federal funds rate below the zero mark would be similar. But even if the Fed choose to do that, businesses and consumers would not be coaxed into making investments rather than hoarding their cash, and interest rates would simply go to exactly zero.

In order to truly enact a negative rate, the Fed would have to go further.

Kimball proposes that central banks effectively make the rate of return on cash negative, by adjusting the conversion rate between paper money and electronic money.

Right now, when a $100 bill is deposited into an account, $100 is added to that account. However, a central bank could create a situation whereby that $100 deposit only led to a $98 increase in the account. That would mean paper currency would have a rate of interest of negative 2 percent, rather than its current 0 percent.


At the same time, the government could not require that businesses accept cash as legal tender. In the service of reducing the overall value of money, the parallel linkage between the two kinds of currency—paper and electronic—would be broken.
The administrator has disabled public write access.
Moderators: MikeRonayne, NathanEgger, amkc
Time to create page: 0.167 seconds

MACRO VOICES is presented for informational and entertainment purposes only. The information presented in MACRO VOICES should NOT be construed as investment advice. Always consult a licensed investment professional before making important investment decisions. The opinions expressed on MACRO VOICES are those of the participants. MACRO VOICES, its producers, and hosts Erik Townsend and Nathan Egger shall NOT be liable for losses resulting from investment decisions based on information or viewpoints presented on MACRO VOICES.

Go to top