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Citigroup's Gold "Expert" Demands A Cash Ban

Tyler Durden's picture




 

Late last year, Grexit "expert" Willem Buiter decided that he was a greater expert on the topic of monetary metals than on geopolitics by stating that "Gold Is A 6,000 Year Old Bubble." Now, he has decided that after gold, it is best to just do away with any physical currency altogether and the time to ban cash has arrived.

Submitted by Pater Tenebrarum via Acting-Man blog,

Citigroup’s Chief Economist Joins the Cash Ban Bandwagon

We have discussed the views of Citigroup’s chief economist Willem Buiter previously in these pages (see “A Dose of Buiternomics” for details), on occasion of his coming out as a supporter of assorted monetary cranks, such as Silvio Gesell, to name one. Not to put too fine a point to it, Buiter is a monetary crank too.

Buiter is always shilling for more central bank intervention, and it seems no plan can ever be too silly or too extreme for him. In fact, he seems to have made the propagation of utterly crazy ideas his trademark.

Buiter has now joined one of his famous colleagues, Kenneth Rogoff, another intellectual enamored with central planning, in clamoring for a cash ban (for our discussion of Rogoff, see “Meet Kenneth Rogoff, Unreconstructed Statist”). Both Buiter and Rogoff want to make it impossible for citizens to escape the latest depredations of central bankers, such as the imposition of negative interest rates. This is to be done by forcing them to keep their money in accounts at fractionally reserved banks.

 

web1_WSOP-FINAL-TABLE_111114DB_020_6

If Buiter gets his way, there won’t be a WSOP final table with piles of cash anymore.

Photo credit: David Becker / Las Vegas Review-Journal

As Bloomberg reports:

“The world’s central banks have a problem. When economic conditions worsen, they react by reducing interest rates in order to stimulate the economy. But, as has happened across the world in recent years, there comes a point where those central banks run out of room to cut — they can bring interest rates to zero, but reducing them further below that is fraught with problems, the biggest of which is cash in the economy.

 

In a new piece, Citi’s Willem Buiter looks at this problem, which is known as the effective lower bound (ELB) on nominal interest rates. Fundamentally, the ELB problem comes down to cash. According to Buiter, the ELB only exists at all due to the existence of cash, which is a bearer instrument that pays zero nominal rates. Why have your money on deposit at a negative rate that reduces your wealth when you can have it in cash and suffer no reduction? Cash therefore gives people an easy and effective way of avoiding negative nominal rates. Buiter’s note suggests three ways to address this problem:

  1. Abolish currency.
  2. Tax currency.
  3. Remove the fixed exchange rate between currency and central bank reserves/deposits.

Yes, Buiter’s solution to cash’s ability to allow people to avoid negative deposit rates is to abolish cash altogether. (Note that he’s far from being the first to float this idea. Ken Rogoff has given his endorsement to the idea as well, as have others.)

 

Before looking at the practicalities of abolishing currency, we should first look at whether it could ever be necessary. Due to the costs of holding large amounts of cash, Buiter puts the actual nominal rate at which the move to cash makes sense as closer to -100bp. So, in order for a cash abolition to become necessary, central banks would need to be in a position where they wished to set nominal rates much lower than that.

 

Buiter does not have to go far to find an example of where a central bank may have wanted to set interest rates much lower to -100bp. He uses (a fairly aggressive) Taylor Rule to show that Federal Reserve rates should have been as low as -6 percent during the financial crisis.”

(emphasis added)

As mentioned above, no meddling by a central bank is ever too extreme or too crazy for Mr. Buiter. Here is his ridiculous “Taylor rule” chart (the conclusions of which by the way would be vehemently disputed by none other than Mr. Taylor himself).

 

Ridiculous Buiter chart

Buiter’s ridiculous chart asserting that a “negative interest rate of 6% would have been needed” in 2008-2010, via Citigroup, Bloomberg.

 

This nice gentlemen who wants to either “abolish cash” or “tax currency” for the good of us all, is a typical example of the modern-day viciously statist intellectual (h/t, Hans-Hermann Hoppe), who constantly pines for the authorities to implement social engineering on a grand scale. As long as they implement his plan, everything will be great.

 

Not Bothered by Concerns

Bloomberg tells us that “Buiter is aware that his idea may a bit controversial”. What a relief. He even lists the disadvantages of abolishing cash, only to dismiss them out of hand. With the exception of one crucial point, he is mainly erecting straw men.

 

“Buiter is aware that his idea may be somewhat controversial, so he goes to the effort of listing the disadvantages of abolishing cash.

  1. Abolishing currency will constitute a noticeable change in many people’s lives and change often tends to be resisted.
  2. Currency use remains high among the poor and some older people. (Buiter suggests that keeping low-denomination cash in circulation — nothing larger than $5 — might solve this.)
  3. Central banks and governments would lose seigniorage revenue.
  4. Abolishing currency would inevitably be associated with a loss of privacy and create risks of excessive intrusion by the government.
  5. Switching exclusively to electronic payments may create new security and operational risks.

Buiter dismisses each of these concerns in turn, finishing with: In summary, we therefore conclude that the arguments against abolishing currency seem rather weak.

Whatever the strength of the arguments, the chances of an administration taking the decision to abolish cash seem vanishingly small.

We are surprised by the optimism expressed by Bloomberg that “the chances of an administration taking the decision to abolish cash seem vanishingly small”. We believe that governments all over the so-called “free world” are working feverishly to make a ban of cash currency a reality.

Naturally, we couldn’t care less about the “seignorage” revenue of the State. In our opinion central banks shouldn’t even exist, and “seignorage” is nothing but a euphemism for outright theft. It’s a nice touch that Buiter also doesn’t want to “throw seniors under the bus” and gives a brief thought to the poor as well. Why would any of them ever need anything more than a $5 note?

That someone like Buiter doesn’t find it difficult to dismiss the concern that “abolishing currency would inevitably be associated with a loss of privacy and create risks of excessive intrusion by the government” is no surprise, but it is indeed a legitimate concern. Under the cover of the “war on drugs” and lately the even bigger government-sponsored racket known as the “war on terror”, financial privacy has been all but eradicated already.

 

Buiter

Willem Buiter, shill for statism and central planning, here seen at the Council for Foreign Relations. Did we mention that we believe he’s an atrocious economist?

Photo credit: Bloomberg

 

Needless to say, we dispute the idea that central banks should ever impose negative interest rates. This policy is revolting economic nonsense that greatly harms the economy. As we have previously pointed out, given that the natural rate of interest can never be zero or negative, it is an inescapable conclusion that any imposition of negative market rates will end up destroying scarce capital and leave society poorer.

Lastly, Buiter fails to list one counterargument that we believe is extremely important. Since he works for a charter member of the world’s most powerful banking cartel, this is no big surprise either. We will make up for his oversight.

The 2008 crisis has not shown that anyone needs “negative interest rates” as Buiter erroneously claims. It has mainly shown how rickety and de facto insolvent the fractionally reserved banking system really is. If not for the introduction of an accounting trick (under immense political pressure, the FASB allowed the banks to dispense with mark-to-market accounting, which suddenly made them “whole” again), a huge taxpayer bailout and money printing by the central bank on an unprecedented scale (in the post WW2 era), several of the biggest banks would have gone the way of Lehman.

It was a good reminder that although fiduciary media – deposit money that is not backed by standard money – are part of the money supply in the broader sense, their main characteristic is that they exist only in the form of accounting entries. Hence, fractionally reserved banks are at all times insolvent, since they cannot possibly pay all demand deposits on demand. This obvious violation of what once used to be a bailment contract has been sanctioned by the courts in the 19th century under the influence of banking interests. If one considers how deposit money is multiplied under this system, it should be obvious that the scheme is fundamentally fraudulent. It goes against the grain of legal traditions that have been well-established in Western culture since antiquity.

If cash were to be banned, people could no longer opt out from this system. Bank runs would no longer be possible at all. While a bank run these days only gives one government scrip that is itself an irredeemable liability of a central bank, it is at least slightly more “real” than the accounting entry known as deposit money. Most importantly, cash can insure one against a bank going under, or the breakdown of the entire banking system, which is always a potential danger. Banks would obviously love a cash ban – quite possibly they are the only ones who would love it even more than governments.

 

1212cash

 

Conclusion

We keep being bombarded by moves to restrict the use of cash and demands to ban it altogether. These demands seem to mainly revolve around two arguments: one is that “only criminals need cash”, which is on a par with the absurd assertion that we should all be fine with Stasi-like ubiquitous government surveillance “if we have nothing to hide”. The other one is that a cash ban would make life easier for the central planners who are actively undermining the economy with their policy of debasement. We would argue that central banking and fiat money have done more than enough harm already and that the eradication of financial privacy has gone way too far. Money and banking should be freed from the clutches of government-directed monopolization and cartelization and should be returned to the free market.

 

Addendum:

One of our readers has sent us a few links concerning recent examples of the war on cash waged by governments the world over, which we reproduce below. Indeed, there is little cause for optimism on this score. Given this increase in attempts to restrict the use of cash, the danger that possession of gold will one day be declared illegal again can no longer be so easily dismissed either.

 

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Thu, 04/16/2015 - 13:10 | 5999298 PirateOfBaltimore
PirateOfBaltimore's picture

Fuck you, banksters.  Ban cash, I go barter.

Thu, 04/16/2015 - 13:12 | 5999305 knukles
knukles's picture

Fuck Statism, Butier (betcha that Citi's not too happy about that attitude as in screws the very fabric banking business) and a cashless society.
How's about eliminating financial engineering?

Thu, 04/16/2015 - 13:14 | 5999313 jaap
jaap's picture

The question is, did he pay the presents and dinners for Heleen Mees with the family bank account?

Thu, 04/16/2015 - 13:20 | 5999341 nope-1004
nope-1004's picture

Stupid assed banker.  Wouldn't want monetary freedom amongst the people now would we?  Going all digital so they can track, trace, tax, and confiscate.

Much of this is happening already.  Go to your bank and ask to withrawal $1500.  "We don't have that" is what I was told.  A BANK!!!

lmao

Thu, 04/16/2015 - 13:21 | 5999361 Harbanger
Harbanger's picture

I can't wait for Govs like Iceland and others to Nationalize their Central Banks.  Maybe then people will see what their problem really is.

Thu, 04/16/2015 - 13:29 | 5999383 Captain Debtcrash
Captain Debtcrash's picture

Huh only 5 days after I wrote a piece bashing Buiters proposal: http://www.debtcrash.report/entry/economist-buiter-proposes-a-cashless-society

Thu, 04/16/2015 - 13:30 | 5999411 outamyeffinway
outamyeffinway's picture

If they banish cash, how will Harry Reid get paid?

Thu, 04/16/2015 - 13:35 | 5999443 Manthong
Manthong's picture

That Tree of Liberty looks to be getting awfully thirsty.

Thu, 04/16/2015 - 13:40 | 5999463 Xibalba
Xibalba's picture

What's wrong with a One World, Digital, Currency?  You can have an RFID chip implanted at birth, all of your records stored on it, and never have to worry about forgetting your drivers license or wallet again!  Wholla!  

Thu, 04/16/2015 - 13:45 | 5999489 SilverIsKing
SilverIsKing's picture

Voila!  or Hollaaaa!

Thu, 04/16/2015 - 13:47 | 5999500 Silky Johnson
Silky Johnson's picture

I have a better demand, bankers and economists should be required to pass an exam before being hired. Applicants are hung from a gallows for an hour, if they survive, they are hired.

Thu, 04/16/2015 - 13:57 | 5999546 SWRichmond
SWRichmond's picture

No private citizen should be allowed to own assault cash.  It is far too powerful.  Only the state should be allowed to own cash.  This is for your own protection.  Only criminals need semiautomatic assault cash.

If private citizens must be allowed to own cash, it must be only small magazine capacity cash (5$ or less).

Thu, 04/16/2015 - 13:59 | 5999556 El Vaquero
El Vaquero's picture

Fuck this crooked fuck.

Thu, 04/16/2015 - 14:05 | 5999577 Bay of Pigs
Bay of Pigs's picture

+1 Evil personified.

Thu, 04/16/2015 - 14:27 | 5999660 OpTwoMistic
OpTwoMistic's picture

This man and his ilk serve a demon. I avoid banks totally.

Thu, 04/16/2015 - 14:37 | 5999722 SumTing Wong
SumTing Wong's picture

This is called a trial balloon. When all of the sheeple are too busy watching American Idol, they will start banning cash. And then they will say, "Well, none of you objected."

I work on the underground economy. We'll keep working it, even if it involved trading PMs or ammunition or Tide detergent or whatever.

Thu, 04/16/2015 - 14:51 | 5999790 green sheen
green sheen's picture

Since when do rich people care about money? They own everything!

https://www.youtube.com/watch?v=68V1-2OGeYw

Thu, 04/16/2015 - 16:11 | 6000103 Haus-Targaryen
Haus-Targaryen's picture

I can't get into cash huh?  

How about I pop myself into my little car and drive into Switzerland a few times a year to "stock up?" Or are you going to ban the Swiss from having cash too?  

He has more problems in his theory than sliced cheese.  Oh, then there is Poland, the Czech Republic, Denmark, Norway, the UK, etc., etc., etc.,  And even if you did get all these countries to give you a reach-around -- there is still the Rusky Currency.  

Then again, sir, because of you I am stacking like a mother fucker. 

I will pay no "European Solidarity Contribution" or other such nonsense.  

Thu, 04/16/2015 - 18:29 | 6000612 Supernova Born
Supernova Born's picture

With the $100 bill worth a mere $14 in 1967 buying power?

All they have to do is leave the maximum denomination the $100 and inflation will take care of cash's utility.

 

 

Thu, 04/16/2015 - 17:19 | 6000367 Stuck on Zero
Stuck on Zero's picture

Please, someone, hack this guys bank codes and steal all his money.

Thu, 04/16/2015 - 15:02 | 5999847 Herd Redirectio...
Herd Redirection Committee's picture

Only criminals use cash, ergo criminals would have looked to take over the fiat creation/moneyprinting business, amiright?

It reminds me of currency debasement in the time of gold/silver standard.  Coins would get clipped, and the sovereign/central banks would call in all the old coins, and make 25% more coins by making them 25% copper!  Now, if you  or I did that, it would be highly illegal!

Thu, 04/16/2015 - 14:06 | 5999585 Colonel Klink
Colonel Klink's picture

I think the world needs to ban (read hang) Ivory tower assholes!  Especially those who run Central banks, attend Bilderberger conferences, and those who try to control others.

Thu, 04/16/2015 - 14:30 | 5999678 Thirst Mutilator
Thirst Mutilator's picture

Who runs BARTERTOWN?

Thu, 04/16/2015 - 19:04 | 6000758 turnoffthewater
turnoffthewater's picture

Taylor rule = a lot higher gold price

Thu, 04/16/2015 - 14:13 | 5999609 Ignatius
Ignatius's picture

How are they going to 'explain' the continuing existence of the profitable illicit drug trade after such a move as banning cash?

 

Thu, 04/16/2015 - 14:30 | 5999679 El Vaquero
El Vaquero's picture

I was wondering the same thing myself.  They would rely on the masses being sheepishly stoopid.  Unfortunately, more and more of us are waking up.  A lot don't understand why things suck, but they fully understand that things suck. 

Thu, 04/16/2015 - 14:32 | 5999689 cnmcdee
cnmcdee's picture

The Law - Frederick Bastiat

http://bastiat.org/en/the_law.html#SECTION_G015

 

But how is this legal plunder to be identified? Quite simply. See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime.

Then abolish this law without delay, for it is not only an evil itself, but also it is a fertile source for further evils because it invites reprisals. If such a law — which may be an isolated case — is not abolished immediately, it will spread, multiply, and develop into a system.

The person who profits from this law will complain bitterly, defending his acquired rights. He will claim that the state is obligated to protect and encourage his particular industry; that this procedure enriches the state because the protected industry is thus able to spend more and to pay higher wages to the poor workingmen.

Do not listen to this sophistry by vested interests. The acceptance of these arguments will build legal plunder into a whole system. In fact, this has already occurred. The present-day delusion is an attempt to enrich everyone at the expense of everyone else; to make plunder universal under the pretense of organizing it.

Thu, 04/16/2015 - 18:06 | 6000541 Hari_Seldon
Hari_Seldon's picture

Is this idiot not worried about ending up on the wrong end of a nailgun?

Thu, 04/16/2015 - 14:05 | 5999561 macholatte
macholatte's picture

 

Statist Modern day supporter of political slavery; A secular State-Worshiper; Member of the cult of the State; An irrational, immoral, collectivist parasite which leeches off the productive private sector at the point of a gun, while attempting to justify such behavior through invalid, unethical, altruistic arguments. Uses statist law (oppressive edicts backed by criminal violence) to intimidate and run the neo-slave racket. Typically found in government, politics, bureaucracy, police, military and law; aka Supporter of such; Governmentalist; Nationalist; A degenerate sub-human who makes your life a living hell; An accident just waiting to happen... / / Anarcho capitalist A person whose philosophy is based on the idea of individual sovereignty, and a prohibition against theft, coercion and fraud. It sees the only just basis for law as arising from private property norms and an unlimited right of contract between free and sovereign individuals. From this basis, anarcho-capitalism rejects the state as an unjustified monopolist and systematic aggressor against sovereign individuals, and embraces anti-statist laissez-faire capitalism. Anarcho-capitalists would aim to protect individual liberty and property by replacing government monopoly, which is involuntarily funded through theft by taxation, with private, competing businesses that use physical force only in defense of liberty and property against aggressors. Hence, they believe that all goods and services, including law, order, and security, should be supplied through the mechanism of a free market. Anarcho capitalists know that when you keep all of what you produce, you have an incentive to produce more, thus the whole of society benefits greatly from each individuals inherent greed.
Thu, 04/16/2015 - 14:13 | 5999610 ILLILLILLI
ILLILLILLI's picture

Replace the word 'greed' at the end there with 'enlightened self-interest' and you've got a winner.

Thu, 04/16/2015 - 14:07 | 5999562 BaBaBouy
BaBaBouy's picture

Shyit... Where Is I Sis When You Need Em..?..

Thu, 04/16/2015 - 14:15 | 5999613 Ignatius
Ignatius's picture

Will the 'thong chick' attack this guy?

Thu, 04/16/2015 - 14:02 | 5999567 ILLILLILLI
ILLILLILLI's picture

They can have my cash when they pry it from my cold, dead fingers.

As if...

Thu, 04/16/2015 - 15:25 | 5999948 lehmen_sisters
lehmen_sisters's picture

You will also need to trade in your CCW for the new CCC , Carrying Concealed Cash permit.

Thu, 04/16/2015 - 22:22 | 6001522 Me.Grimlock
Me.Grimlock's picture

"Assault Cash" was the name of my band before we changed the name to "The Avocado Seizures".

Thu, 04/16/2015 - 14:05 | 5999552 BaBaBouy
BaBaBouy's picture

ALL HAIL The Keynster Bankers ...

Thu, 04/16/2015 - 13:48 | 5999509 I am more equal...
I am more equal than others's picture

 

 

 

Band stupidity. 

If that happens there would be a lot of politicians, bankers and corporate leaders digging ditches.

Ditches could be used for burial purposes too. 

Thu, 04/16/2015 - 14:02 | 5999563 El Vaquero
El Vaquero's picture

Exactly.  And if they were to actually go through with it, they would get a lot of mail warning them of as much before they finished the job too.  Not just the random death threat, they would be flooded with "we'll kill you and your banker backers, motherfuckers" type letters. 

Thu, 04/16/2015 - 14:27 | 5999663 Cannon Fodder
Cannon Fodder's picture

May I suggest you read your Bible, for a spoiler, skip to the end, the Book of Revelation.... something about the Mark of the Beast....

Thu, 04/16/2015 - 14:57 | 5999814 Bananamerican
Bananamerican's picture

I've never been big on "End Of Days"/Rapture/Armageddon talk but if they ban cash, ima start thinkin' about it....

Thu, 04/16/2015 - 15:35 | 5999996 El Vaquero
El Vaquero's picture

It will lead to the end of their days if they go through with something like that.  The criminal cocksuckers are getting desperate. 

Thu, 04/16/2015 - 13:48 | 5999508 fascismlover
fascismlover's picture

same as he does now, in transvestite hookers and blow

Thu, 04/16/2015 - 13:49 | 5999513 zhandax
zhandax's picture

Ban Birinyi rulers, instead.

Thu, 04/16/2015 - 14:22 | 5999623 bwh1214
bwh1214's picture

What a joke!

Thu, 04/16/2015 - 14:16 | 5999617 RaceToTheBottom
RaceToTheBottom's picture

I think banishing cash allows for more central banks shenanigans, not less.  

What presently gets delivered as bags of cash, held in congressman's freezers would be delivered directly to bank accounts of congressmen, disguised as whatever to whichever account they want it hidden in.

Thu, 04/16/2015 - 14:27 | 5999657 Captain Debtcrash
Captain Debtcrash's picture

Pater Tenebrarum took MY POST added a bunch of fluff waited a few days and posted it to his blog.

Thu, 04/16/2015 - 15:39 | 6000008 bwh1214
bwh1214's picture

Yep strait up stole that shit!!!

Thu, 04/16/2015 - 19:38 | 6000908 Thisson
Thisson's picture

You think you're the only one that thinks this?  That just because you posted first the idea is yours?  You can't copyright an idea.  You don't own it.

Thu, 04/16/2015 - 15:40 | 6000010 DavidC
DavidC's picture

outamyeffinway,
Easy, insider trading - it's not illegal for them.

DavidC

Thu, 04/16/2015 - 13:25 | 5999386 RU-GAY2
RU-GAY2's picture

They ban cash at their peril.  Because they're too stupid to understand the size and depth of the black markets which would immediately go to gold, silver, Bitcoin and other alternatives...

Thu, 04/16/2015 - 13:44 | 5999486 NotApplicable
NotApplicable's picture

But then they get to legally shoot all of those people (who are but a small percentage of the population).

That's a win-win, I'd say.

Thu, 04/16/2015 - 13:59 | 5999553 angel_of_joy
angel_of_joy's picture

Like that was ever a problem here...

Fri, 04/17/2015 - 06:21 | 6002192 Pseudonymous
Pseudonymous's picture

But then everyone would be in the right (morally) to shoot the shooters.

Thu, 04/16/2015 - 14:17 | 5999621 Bush Baby
Bush Baby's picture

A global digital currency structered similar to bitcoin, with zero possibility of creating more (no printing) , would probably be better than the shit show we have now.

Thu, 04/16/2015 - 14:54 | 5999398 SoilMyselfRotten
SoilMyselfRotten's picture

As the dearly departed Aaron Russo once said, 'they want to chip everybody and they will control the chips.' Hey BUTTler, FU and your Rothschild masters!

Thu, 04/16/2015 - 13:25 | 5999387 laomei
laomei's picture

Now go ahead and insist... demand your money.  It only gets funnier from there.

Thu, 04/16/2015 - 15:11 | 5999881 anonnn
anonnn's picture

Capitalism+escaping ravages of

 

Getting filthy rich is the favored way to escape the ravages of capitalism.

 

How's that for a fixed idea.

 

Having scruples would be counter-intention.

 

Much disparate information makes sense when viewed thru that lens.

 

Thu, 04/16/2015 - 13:15 | 5999324 KnuckleDragger-X
KnuckleDragger-X's picture

One nailgun accident at a time......

Thu, 04/16/2015 - 13:37 | 5999451 Manthong
Manthong's picture

Swan dives onto fence pikes have much greater dramatic flair.

Thu, 04/16/2015 - 13:14 | 5999317 insanelysane
insanelysane's picture

Gonna need to ban guns and ammo before banning cash.  Might need to ban nail guns and pitch forks as well.

Thu, 04/16/2015 - 13:18 | 5999349 Skateboarder
Skateboarder's picture

Ban everything: possession of any molecule at all is punishable by heavy fines and imprisonment.

Thu, 04/16/2015 - 13:39 | 5999459 PTR
PTR's picture

Or maybe they just bring out the deathstills.

Thu, 04/16/2015 - 13:20 | 5999357 Fun Facts
Fun Facts's picture

Stanley Fischer [the real head of the Federal Reserve Corporation] was the first central banker to float the idea of banning cash back when he was the head of the Bank of Israel.

Thu, 04/16/2015 - 17:04 | 6000305 JuliaS
JuliaS's picture

Why ban guns? When guns are allowed, any suspect can be presumed to be armed and dangerous. Shoot first and sort through the body parts later. "Oh, so there was a banana in his pocket!"

With all the guns one might think we'd be more prosperous and free than anyone else in the world? Well, no such luck. The only people who seem to actually know how to use theirs are Icelanders.

Thu, 04/16/2015 - 13:14 | 5999320 Harbanger
Harbanger's picture

It's actually Governments that want to ban cash so they can squeeze every last tax out of the plebs.  Bankers just want their interest payments from the Govs. they don't really care how it's collected.

Thu, 04/16/2015 - 13:28 | 5999399 agstacks
agstacks's picture

Harbanger-

 

How do you reply to people who say, "The Fed returns the money it collects as interest back to the Treasury."  I need help with this one.  Aside from the 6% dividend Fed members are guaranteed in section 7 of the fed reserve act, I'm trying to understand this point better. Thanks to anyone who can elaborate here. 

Thu, 04/16/2015 - 13:44 | 5999483 Buzz Fuzzel
Buzz Fuzzel's picture

The Fed started with nothing, produces nothing and has no authority to tax.  The better question in how did the fed get the resources to buy all those assets on their balance sheet?  An even better question, why does the Fed not forgive all the loans represented by assets on their balance sheet.  The American tax payers debt would drop $4 trillion over night and who would be hurt?

 

Thu, 04/16/2015 - 13:53 | 5999527 Harbanger
Harbanger's picture

The Fed is required to turn over its profits to the Treasury each year, but it also has the ability to monitize or print money.
The Fed is a private bank and the largest investor in Government debt, so it receives interest on it's Govt issued investments.
 ie It buys bonds, treasuries, mortgage backed securities etc.  The money flowing into the Fed comes from taxpayers to pay interest on Government debt.  It's a net loss for the country as most of the money collected is simply paying interest on the debt.  The rude awakening will come when people realize that their Govs are broke from decades of overspending.

Thu, 04/16/2015 - 13:59 | 5999554 overmedicatedun...
overmedicatedundersexed's picture

remember worthless paper debt is well worthless, such a hard concept for the EU and it seems many here.

Fri, 04/17/2015 - 11:58 | 6003160 Buzz Fuzzel
Buzz Fuzzel's picture

Just answer me this, where did the Fed get it's first dollar to buy it's first bond which is now paying inteest to the Treasury?  Money is, among other things a store of wealth.  Wealth is created by productive effort on the part of some person or organization.  The Fed started with nothing, produces nothing and has no authority to tax.  All of the assets on the Fed balance sheet have zero value as money.  Eventually Mother Nature is going to reassert her authority and this shell game will end with much pain and suffering.

 

Thu, 04/16/2015 - 14:20 | 5999630 Immortal Flatulence
Immortal Flatulence's picture

Money is just a means to an end. The end it control.

(and no, i was not the one who gave you a minus)

Thu, 04/16/2015 - 15:12 | 5999894 wendigo
wendigo's picture

What are you doing with headbanger's avatar? 

Thu, 04/16/2015 - 14:22 | 5999637 Bush Baby
Bush Baby's picture

I would love to able to say that the tax cheats force legitimate taxpayors to pay a higher tax rate, and a cashless system would eliminate the tax evaders, I really would.

 

Thu, 04/16/2015 - 13:21 | 5999336 Kirk2NCC1701
Kirk2NCC1701's picture

"Fuck you, banksters. Ban cash, I go barter."

You should be able to figure out that if they actually succeeded in banning cash, that they'd also ban barter or any mechanism the seeks to create a Parallel Economy/System.

To the point... Barter? What's with the passive response? No revolting or storming the barricades, the way they do it in other countries?

Prediction: When assholes like him "ban cash" they forfeit the PROBABILITY of a long an healthy life. My bet is they will swing from the rafters, or benefit from a similar Exit Strategy.

Thu, 04/16/2015 - 13:24 | 5999375 Harbanger
Harbanger's picture

Bankers don't write laws.  Their puppets, our elected leaders do.

Thu, 04/16/2015 - 13:34 | 5999431 Kirk2NCC1701
Kirk2NCC1701's picture

Of course. Please see my post 5999413 below: "The day will arrive..."

Thu, 04/16/2015 - 13:22 | 5999368 ZH Snob
ZH Snob's picture

if we have no cash how will all the corrupted in our govt. get paid? 

but I might be a bit naive.  if and when such a policy is adopted, all the payoffs will probably just be included in their salary.  or, maybe they will get paid with the oldest money in existence:

GOLD

Thu, 04/16/2015 - 13:25 | 5999388 indygo55
indygo55's picture

Then how would I buy my heroin?

Thu, 04/16/2015 - 13:33 | 5999429 msmith9962
msmith9962's picture

Strip clubs for that matter.

Thu, 04/16/2015 - 13:50 | 5999523 raywolf
raywolf's picture

Do away with taxes as well, then we can crank the negative interest rates up to 50%..... that should stimulate the econonmy to the wazzoo... And while that's in progress give out free cocaine to help people work longer hours...

Thu, 04/16/2015 - 14:12 | 5999604 Immortal Flatulence
Immortal Flatulence's picture

Next it will be to RFID eveything (or damn near everything). It's all about control. We are owned already.

Thu, 04/16/2015 - 14:23 | 5999644 JRobby
JRobby's picture

Just another madman/banker

Thu, 04/16/2015 - 14:55 | 5999801 BrosephStiglitz
BrosephStiglitz's picture

These morons are going to destroy the market.. It is obvious (at least to me) and people who have a clue, that QE has been quite deflationary, driving people into physical assets and paper cash, rather than into investment or loans as the KrugPals would like. Unfortunately for these dildos, if they do away with gold and electronic currency, it will drive people into other tangible "assets", like rice, or flour, or something else.  Maybe ammunition (something I think could actually substitute for currency) in the US.

These people are lunatics. Truly.  No respect for capitalism, no respect for the individual, and no respect for the market mechanism. 

Thu, 04/16/2015 - 17:32 | 6000417 golden torch
golden torch's picture

I'm making over $7k a month working part time. I kept hearing other people tell me how much money they can make online so I decided to look into it. Well, it was all true and has totally changed my life. This is what I do... www.globe-report.com

Thu, 04/16/2015 - 18:17 | 6000577 Jumbotron
Jumbotron's picture

Cashless economy means total control.  We know the elite have always wanted total control since time began.  So this is just the next logical step.  Since money is the lifeblood of all we do, is the source of power here on earth....now you begin to realize the full depth of the addage..."For the LOVE of money is the root if ALL EVIL"

 

Why?  For who creates and controls money controls all things on earth....including the behavior of individuals as well as countries.

 

In effect....those that create and control money are gods on earth.

 

Between the cashless economy, personal boimetrics, and the simultaneous push by the elites to extend life by hundreds if not a thousand years....I feel God is about to move and shake up our apple cart but good.

 

His first move may just be to reveal a guy whose P.I.N. number to his account is 666.

 

 

 

 

Thu, 04/16/2015 - 13:13 | 5999315 KnuckleDragger-X
KnuckleDragger-X's picture

Physical money, even if its fiat, gives the proles too much power and if your a member of the self-proclaimed elite, any freedom other than your own cannot be allowed......

Thu, 04/16/2015 - 13:14 | 5999316 Fun Facts
Fun Facts's picture

The soldiers put 10kv to the gonads of the wrong people.

Thu, 04/16/2015 - 13:14 | 5999319 WTFRLY
WTFRLY's picture

They won't stop until they start riots and at that point, may the unwashed hordes drag them into the streets. Death to the New World Order.

Thu, 04/16/2015 - 13:16 | 5999337 KnuckleDragger-X
KnuckleDragger-X's picture

The riots are coming when the bread and circuses no longer are freely available......

Thu, 04/16/2015 - 13:33 | 5999424 Fun Facts
Fun Facts's picture

EBT system going down for 24 hours would be all it takes to have the windows of every Wal Mart in America smashed in.

A ferguson for every city.

Consequences of central bank wanton destruction of the middle class.

Thu, 04/16/2015 - 13:55 | 5999540 KnuckleDragger-X
KnuckleDragger-X's picture

To do it right, it should go down on the first Monday of the month.....

Thu, 04/16/2015 - 13:16 | 5999335 Skateboarder
Skateboarder's picture

Coming up with that disadvantages list for these types of fuckers is like coming up with a list of personal weaknesses in an interview: "I work too many hours and am too punctual."

Thu, 04/16/2015 - 13:17 | 5999340 Usurious
Usurious's picture

Willem Buiter speaks on behalf of the Rockefellers and the Rothschilds tribe, fuck em and feed em beans........

Thu, 04/16/2015 - 13:18 | 5999351 Al Huxley
Al Huxley's picture

Hey, and then after people can't save outside the bank system, we could take the next logical step where nobody has ANY money and everybody just gets whatever food, shelter and clothing the banks deem necessary and warranted based on each individual's perceived contribution to the banking system's well being. 

 

Where are the nailguns when they're really needed?

Thu, 04/16/2015 - 13:20 | 5999352 One Eyed Jack
One Eyed Jack's picture

I think that it is time to ban bankers from having pulses.

Thu, 04/16/2015 - 13:19 | 5999354 Kaiser Sousa
Kaiser Sousa's picture

u've been warned...

REPEATEDLY!

there r only 2 forms of real money - Physical Gold and Silver....

FUCKING PERIOD.

Thu, 04/16/2015 - 13:20 | 5999356 Urban Redneck
Urban Redneck's picture

How did this brain dead cocksucker ever get a bankster membership card?  Seriously, exactly who at Citibank did be actually blow?

If you abolish USD, you abolish a huge chunk of overseas demand for USD and effectively kill USD hegemony and the US economy overnight.  All the fucking central banks have digital printing presses, only the FRBNY can load up 747's with cotton-linen blend and not sink their "product's" valuation in the process.

Thu, 04/16/2015 - 13:35 | 5999440 oddjob
oddjob's picture

No doubt, the first red flag was the cum stains on his neck tie.

Thu, 04/16/2015 - 13:21 | 5999366 reader2010
reader2010's picture

In a cashless future society of a sci-fi novel that was written in 1960s,  people are implanted with a microchip at birth, which contains all your ID data and banking data. They can credit and deduct money stored there wireless. 

Thu, 04/16/2015 - 13:56 | 5999545 overmedicatedun...
overmedicatedundersexed's picture

if they ban cash, only criminals will have cash! digital money is so much more easy to control and tax, and not allow you to buy things that are not good for you..and well any excess digits will be in your safe digital accounts at any international bank you choose. I think humans will not tolerate this, but sheep will never even notice. the virtual world is where so many spend much of life - why not keep your money there as well?

Thu, 04/16/2015 - 14:27 | 5999661 Immortal Flatulence
Immortal Flatulence's picture

Yeah, and the 1960's book go the idea from and even older book... the bible. Revelation 13:16-17

Thu, 04/16/2015 - 13:21 | 5999369 rlouis
rlouis's picture

He is a threat to the peaceful coexistence of human beings everywhere and should be evaluated for mental illness.

Thu, 04/16/2015 - 13:24 | 5999378 lasvegaspersona
lasvegaspersona's picture

Saving outside the monetary system will be thesalvation of the individual. The message we are getting with NIRP and bail-ins is this: DO NOT SAVE CURRENCY. I don't think it is intentional but it is clear if you think it through.

We will have to wait for the current system to fail (and the paper gold system with it) but coming out the other side it will be clear that currency is for medium of exchange function only. Savings should be in gold (or other real world assets) that do not disrupt the medium of exchange function of currency.

When we hoard currency we decrease its purpose of lubricating commerce but more importantly we allow the printers of currency to print way more than is needed. This leads to a build up until it reaches a pinacle at which time the entire system fails as folks realize just how many paper promises have been printed....and how much power the printer has stolen.

I'm not blaming banks, they are stuck in the current paradigm just like all of us. It has gone on wway too long and the manifestatons of it's scandalous construction flaws are showing.

Rueff saw this early on but the decisions had been made and we have lived with it for 70 years.

Thu, 04/16/2015 - 13:24 | 5999380 Dekyus
Dekyus's picture

yeah cash ban, don't use money anymore ! the god of men

Thu, 04/16/2015 - 13:24 | 5999381 Dekyus
Dekyus's picture

yeah cash ban, don't use money anymore ! the god of men

Thu, 04/16/2015 - 13:24 | 5999382 Clowns on Acid
Clowns on Acid's picture

Buiter suffers from the same problem as Krugman... Buiter has never been punched in the face. But I think that the probability is increasing.

Thu, 04/16/2015 - 13:26 | 5999390 Joebloinvestor
Joebloinvestor's picture

A cashless system is called BARTER.

Thu, 04/16/2015 - 13:39 | 5999460 Kirk2NCC1701
Kirk2NCC1701's picture

Technically, No. Barter is only ONE form of a cashless system. ETF (Electronic Transfer of Funds) is another, as are Crypto-Currencies.

The ETF is their Goal, so they'll have complete control (to track and trace financial transactions, and your location).

Thu, 04/16/2015 - 13:43 | 5999461 Kirk2NCC1701
Kirk2NCC1701's picture

deleted duplicate.

Thu, 04/16/2015 - 13:42 | 5999464 Kirk2NCC1701
Kirk2NCC1701's picture

deleted excess post

Thu, 04/16/2015 - 15:29 | 5999393 TalkToLind
TalkToLind's picture

GOLD MOTHER FUCKERS! Turn off DWTS and get some gold before it's too late. And if you don't have enough fiat/credit for gold then at least get some silver.  

Thu, 04/16/2015 - 13:28 | 5999397 Conax
Conax's picture

There is a better solution than banning cash. We instead Ban Mr Buiter to North Korea where his intellectual cohorts are in charge and he can tax currency, force savers into bank accounts at a loss and generally suck commie dick to his heart's content.

Thu, 04/16/2015 - 13:29 | 5999404 CuttingEdge
CuttingEdge's picture

Someone do the 99.9% a favour and just put a bullet in this cunt's brainpan. Pretty please.

Thu, 04/16/2015 - 13:37 | 5999449 Jethro
Jethro's picture

You'd be adding mass that way.

Thu, 04/16/2015 - 13:29 | 5999405 Quinvarius
Quinvarius's picture

It is interesting how even a child can see how this would friggen wreak havoc on the real economy and return the majority of the real system to barter within a couple years, but this expert dipshit can't figure it out.  Are we all going to walk around with POS systems to conduct all of our basic transaction?  Here is your money lawn mowing, kid.  Here is your allowance, son.  Can I borrow $50 to buy a dinner?  Sure!  Let me just ring that up with Visa terminal connection.  Friggen retarded.   Money does not exist to server bankers or governments.  It exists to serve trade.  If you limit it, it is no longer useful in trade and no longer serves a purpose. 

Thu, 04/16/2015 - 13:30 | 5999410 pakled
pakled's picture

I'm not going to even say anything.

Thu, 04/16/2015 - 13:31 | 5999413 Kirk2NCC1701
Kirk2NCC1701's picture

The day will arrive when Banksters and Politicians will learn that 'The People' will react 3 ways to their Central Ponzi and Central Control -- which violate all Natural laws, the Constitution and Common Sense:

1. Cash + Barter
2. Lobbying + Votes
3. Protesting + Revolting

TPTB just do NOT have the Bandwidth in personnel to attain and MAINTAIN the level of control they seek and dream of.

Thu, 04/16/2015 - 13:42 | 5999470 lakecity55
lakecity55's picture

Sorry, but the day will arrive when nuclear war, nerve gas, and Ebola are allowed to run rampant. The few remaining humans will serve as slaves, their children raped and murdered by the PTB, their blood consumed for its vitality, and all of civilization will collapse.

Thu, 04/16/2015 - 13:53 | 5999534 Kirk2NCC1701
Kirk2NCC1701's picture

I agree that this is a very likely outcome, if People in the West don't get off their butts, and start getting (1) informed, (2) active and (3) organized. Anything short of that will not be enough, and amounts to "civic escapism".

ZH is a great place for Step 1 (to get informed), but we all need to take the next steps also. Remember my saying:

"Freedom is not for the uninformed, dumb, lazy, scared, or disorganized". Because those who are obsessed with power and control over others, espouse the very opposite attributes.

Thu, 04/16/2015 - 13:31 | 5999414 joego1
joego1's picture

They won't be happy until every human has a World Bank Butt Coin implanted in their ass.

Thu, 04/16/2015 - 13:31 | 5999417 debtor of last ...
debtor of last resort's picture

He's Dutch. Send his head back.

Thu, 04/16/2015 - 13:32 | 5999418 rsnoble
rsnoble's picture

More like only the mega-criminals use digital zeros.

Thu, 04/16/2015 - 13:32 | 5999419 buzzsaw99
buzzsaw99's picture

who cares? it's only clownbux

Thu, 04/16/2015 - 13:34 | 5999422 Jethro
Jethro's picture

Dear Willem, go eat a bag of dicks. OK?  Thanks....

Thu, 04/16/2015 - 18:03 | 6000521 Dickweed Wang
Dickweed Wang's picture

Dearest Jethro,

Where can you get a bag of zee dicks?  I'm fresh out.

Danka,

Willem

Thu, 04/16/2015 - 13:32 | 5999423 youngman
youngman's picture

John Dillinger and Bonnie and Clyde would be pissed.....it would ruin their whole economy....what do you do run into the bank and scream hands up and give me your pin number?????  lol

Thu, 04/16/2015 - 13:33 | 5999426 katchum
katchum's picture

If gold is included in SDR, it cannot be illegal. Currencies would be illegal too.

Thu, 04/16/2015 - 13:34 | 5999436 unplugged
unplugged's picture

Hey dickhead, I've got some bans for you:

 

Ban bankers

Ban govt

Ban fiat currency

 

take those and shove them up your ass Willem

(dude can't even spell William right)

Thu, 04/16/2015 - 13:37 | 5999438 JohnGaltsChild
JohnGaltsChild's picture

Just when you thought collectivist reasoning couldn't get any worse....and we thought fiat was a bad idea.

Thu, 04/16/2015 - 13:37 | 5999450 kchrisc
kchrisc's picture

It is not "reasoning," but mendacity.

The banksters need to repay us.

 

Let the guillotines do the "reasoning."

Thu, 04/16/2015 - 13:45 | 5999491 JohnGaltsChild
JohnGaltsChild's picture

Ok, I looked it up. You're right.

Thu, 04/16/2015 - 13:51 | 5999518 NotApplicable
NotApplicable's picture

I was initially at a loss trying to come up with the rationale any economist could possibly have to promote a cash ban.

I should've guessed it would be "Won't someone think of those poor, innocent banks?"

Thu, 04/16/2015 - 13:34 | 5999439 brucyy
brucyy's picture

Already there in much of europe

france plan to ban cash payment above eur1000 in a few month.

because quote  : "terrorists used cash for their last attack". I wish i was joking.

Thu, 04/16/2015 - 13:39 | 5999456 lakecity55
lakecity55's picture

CFR: "We must institute International Fascism. It is the only way we can quantify and track the numbers of humans we must Liquidate."

"Bring Forth The Man of Perdition."

Thu, 04/16/2015 - 15:14 | 5999900 tarabel
tarabel's picture

 

 

In the event of an actual crisis, I don't have much of a problem with culling the herd.

But I do have a different idea regarding which cattle need to go to market.

Thu, 04/16/2015 - 13:45 | 5999488 kchrisc
kchrisc's picture

"terrorists used cash for their last attack"

"Never waste a crisis." Especially a fake one.

The banksters need to repay us.

 

What's the word for "guillotine" in French? ;-)

Thu, 04/16/2015 - 15:12 | 5999889 tarabel
tarabel's picture

 

 

Relique Barbarie

Thu, 04/16/2015 - 13:50 | 5999519 walküre
walküre's picture

France has a vibrant cash based underground economy which will only grow bigger.

Fucking economists and politicians cannot see real growth in these cash driven economies to save their lives. There is growth but it is not being taxed or tracked.

Thu, 04/16/2015 - 15:41 | 6000016 agent default
agent default's picture

In order to enforce this total tax compliance, you will have to create a system that will make Stalin puke.  It is not worth the effort, it is not worth the social cost, it is just pursued for the sake of it, because avoidance is an affront to the ego of any statist and any politician out there . 

We are dealing with seriously disturbed people who belong in a mental institution.  Either that or a wax slug in the groin.

Thu, 04/16/2015 - 16:39 | 6000221 HopefulCynical
HopefulCynical's picture

We are dealing with outright psychopaths, whose only true drug is POWER: over the whole of the Earth and everything - and everyone - on it.

There is no cure for psychopathy, either. It's genetic. The neural pathways for empathy simply do not exist in the brain structure of a psychopath.

And they instinctively recognize and flock together with their own kind. They tell themselves they are the next step in evolution; unburdened by conscience and empathy, they are GODS.

They are filth, vermin and parasites; they must be eradicated. Pure and simple.

Thu, 04/16/2015 - 13:35 | 5999441 kchrisc
kchrisc's picture

What a Zionist wrench. Or is he a ratchet?

The banksters need to repay us.

 

A ratchet for their rackets.

Thu, 04/16/2015 - 13:35 | 5999444 lakecity55
lakecity55's picture

"We must institue The Mark.

"Your existance depends only on your slavery to the NWO."

"You are meat bags, nothing more. Submit or be decapitated by ISIS."

Thu, 04/16/2015 - 13:40 | 5999452 Thomas Aquinas
Thomas Aquinas's picture

It's clearly one of his new CFR assignments in preparation to abolish cash and microchip everyone, as Nicholas Rockefeller testified to Aaron Russo; see;

https://www.youtube.com/watch?v=f81VPiVyMJg

 

Antichrist rising!!

Apocalypse 13:17

"And that no man might buy or sell, but he that hath the character, or the name of the beast, or the number of his name."

Thu, 04/16/2015 - 13:59 | 5999555 Kirk2NCC1701
Kirk2NCC1701's picture

It's worse than that... The BioChip will also let them TRACK you -- in REAL time.

Thu, 04/16/2015 - 13:38 | 5999454 DonFromWyoming
DonFromWyoming's picture

I say bring it on.  Go ahead and ban cash.  The USSA would cease to exist in 24 months, breaking up into several more manageable nation states using gold and silver as money.

Idiots like Buiter don't have a clue that banning cash would cause the immediate demise of their bankster-controlled empire.  And +100 for the comment that the smarter tyrants understand that they would have to ban guns and ammo before they ban cash.

Thu, 04/16/2015 - 13:40 | 5999462 shadowboxer
shadowboxer's picture

...just another banker that needs a good suicide

Thu, 04/16/2015 - 13:41 | 5999466 basho
basho's picture

isn't it time to just start putting these guys into cages -mccain style.

Thu, 04/16/2015 - 13:41 | 5999468 Mike Masr
Mike Masr's picture

This guy should get the dead gerbal out of his ass!!

Thu, 04/16/2015 - 13:43 | 5999474 WTFUD
WTFUD's picture

Spit roast this Dutch Pig

Thu, 04/16/2015 - 13:43 | 5999475 ...out of space
...out of space's picture

just think about how much the tangele asset will be worth if this criminal idea get realization.

tax on cash WTF

and if you have cash in hand you will actual avoiding tax. 

 

I wonder what kine of drog they use to get this idea?

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