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Fed Opens Negative Interest Rate Pandora's Box: What Happens Next

Tyler Durden's picture




 

As we already commented extensively, while the Fed's dovish non-hike was a violent surprise for the market, and has led to what may be the first thoroughly unanticipated (at least by the market) policy mistake by the Federal Reserve (judging by the market), the biggest news was the very symbolic, yet all too ominous, negative interest rate forecast in the Fed's projection materials by one FOMC member.

This was the first time in Fed history that an FOMC member has on the record predicted NIRP in the US.

Janey Yellen's subsequent non-denial during the press conference did not exactly inspire hope that the Fed was just "joking":

I don’t expect that we’re going to be in a path of providing additional accommodation. But if the outlook were to change in a way that most of my colleagues and I do not expect, and we found ourselves with a weak economy that needed additional stimulus, we would look at all of our available tools. And that would be something that we would evaluate in that kind of context.

Furthermore, when considering that virtually all of Europe is already flooded by NIRP, and earlier Bank of England's Andy Haldane, one of the otherwise more rational members of the central bank, advocated negative rates in the UK, one can be virtually certain that unless there is a dramatic rebound in the global economy, the next step by Yellen will not be a rate hike, but easing (just as Goldman predicted) right into negative interest rate territory.

What would NIRP in the US mean in practical terms?

For the answer we go straight to, drumroll, the Fed itself whose New York economists discussed precisely this topic just three years ago and issued a very stark warning (which apparently the Fed itself decided to ignore), saying "If Interest Rates Go Negative . . . Or, Be Careful What You Wish For."

This is what the New York Fed said in August 2012:

If Interest Rates Go Negative . . . Or, Be Careful What You Wish For

 

One way to push short-term rates negative would be to charge interest on excess bank reserves. The interest rate paid by the Fed on excess reserves, the so-called IOER, is a benchmark for a wide variety of short-term rates, including rates on Treasury bills, commercial paper, and interbank loans. If the Fed pushes the IOER below zero, other rates are likely to follow.

 

Without taking a position on either the merits of negative interest rates or the Fed's statutory authority to fix the IOER below zero, this post examines some of the possible consequences. We suggest that significantly negative rates—that is, rates below -50 basis points—may spawn a variety of financial innovations, such as special-purpose banks and the use of certified bank checks in large-value transactions, and novel preferences, such as a preference for making early and/or excess payments to creditworthy counterparties and a preference for receiving payments in forms that facilitate deferred collection. Such responses should be expected in a market-based economy but may nevertheless present new problems for financial service providers (when their products and services are used in ways not previously anticipated) and for regulators (if novel private sector behavior leads to new types of systemic risk). 

 

Cash and Cash-like Products 

 

The usual rejoinder to a proposal for negative interest rates is that negative rates are impossible; market participants will simply choose to hold cash. But cash is not a realistic alternative for corporations and state and local governments, or for wealthy individuals. The largest denomination bill available today is the $100 bill. It would take ten thousand such bills to make $1 million. Ten thousand bills take up a lot of space, are costly to transport, and present significant security problems. Nevertheless, if rates go negative, the U.S. Treasury Department’s Bureau of Engraving and Printing will likely be called upon to print a lot more currency as individuals and small businesses substitute cash for at least some of their bank balances.

 

If rates go negative, we should also expect to see financial innovations that emulate cash in more convenient forms. One obvious candidate is a special-purpose bank that offers conventional checking accounts (for a fee) and pledges to hold no asset other than cash (which it immobilizes in a very large vault). Checks written on accounts in a special-purpose bank would be tantamount to negotiable warehouse receipts on the bank’s cash. Special-purpose banks would probably not be viable for small accounts or if interest rates are only slightly below zero, say -25 or -50 basis points (because break-even account fees are likely to be larger), but might start to become attractive if rates go much lower.

 

Early Payments, Excess Payments, and Deferred Collections

 

Beyond cash and special-purpose banks, a variety of interest-avoidance strategies might emerge in connection with payments and collections. For example, a taxpayer might choose to make large excess payments on her quarterly estimated federal income tax filings, with the idea of recovering the excess payments the following April. Similarly, a credit card holder might choose to make a large advance payment and then run down his balance with subsequent expenditures, reversing the usual practice of making purchases first and payments later.

 

We might also see some relatively simple avoidance strategies in connection with conventional payments. If I receive a check from the federal government, or some other creditworthy enterprise, I might choose to put the check in a drawer for a few months rather than deposit it in a bank (which charges interest). In fact, I might even go to my bank and withdraw funds in the form of a certified check made payable to myself, and then put that check in a drawer.

 

Certified checks, which are liabilities of the certifying banks rather than individual depositors, might become a popular means of payment, as well as an attractive store of value, because they can be made payable to order and can be endorsed to subsequent payees. Commercial banks might find their liabilities shifting from deposits (on which they charge interest) to certified checks outstanding (where assessing interest charges could be more challenging). If bank liabilities shifted from deposits to certified checks to a significant degree, banks might be less willing to extend loans, because certified checks are likely to be less stable than deposits as a source of funding.

 

As interest rates go more negative, market participants will have increasing incentives to make payments quickly and to receive payments in forms that can be collected slowly. This is exactly the opposite of what happened when short-term interest rates skyrocketed in the late 1970s: people then wanted to delay making payments as long as possible and to collect payments as quickly as possible. Some corporations chose to write checks on remote banks (to delay collection as long as possible), and consumers learned to cash checks quickly, even if that meant more trips to the bank, and to demand direct deposits. However, if interest rates go negative, the incentives reverse: people receiving payments will prefer checks (which can be held back from collection) to electronic transfers. Such a reversal could impose novel burdens on payment systems that have evolved in an environment of positive interest rates.

 

Conclusion

 

The take-away from this post is that if interest rates go negative, we may see an epochal outburst of socially unproductive—even if individually beneficial—financial innovation. Financial service providers are likely to find their products and services being used in volumes and ways not previously anticipated, and regulators may find that private sector responses to negative interest rates have spawned new risks that are not fully priced by market participants.

Yes, the conclusion is staggering: the Fed itself previewed the complete debacle that the Fed itself is now preparing to unleash with NIRP which will lead to "an epochal outburst of socially unproductive—even if individually beneficial—financial innovation." Not only that but the Fed, in a moment of rare lucidity, admitted that "private sector responses to negative interest rates have spawned new risks that are not fully priced by market participants."

Tell that to Europe, Sweden, Switzerland where NIRP already reigns supreme, and all other countries where NIRP is coming.

But what may be missed between the lines is the Fed's explicit observation that in a world of NIRP, cash will reign supreme, as everyone rushes to withdraw their "taxed" bank deposits and keep the funds in the form of paper cash, hidden safely somewhere where the bank has no access, and where no bank can collect an interest rate for the "privilege" of being funded with a negative rate liability.

Furthermore, as the Fed correctly observes, "the usual rejoinder to a proposal for negative interest rates is that negative rates are impossible; market participants will simply choose to hold cash. But cash is not a realistic alternative for corporations and state and local governments, or for wealthy individuals."

So what is the alternative?

The answer was hinted during Andy Haldane's speech earlier today in which he not only urged the banning of cash but the implementation of negative rates, two concepts which, after reading the note above, should intuitively go hand in hand: as we commented "one idea, Haldane told an audience of business owners in Northern Ireland, could be to scrap cash and adopt a state-issued digital currency like Bitcoin. Although widely reviled as the currency for drug dealers and criminals, Haldane said Bitcoin’s distributed payment technology had ‘real potential’. Which may explain the Fed's sudden fascination in the virtual currency."

And fascination it is. Below are some examples of recent Fed research on a topic which as recently as 2011 it held as a heretic taboo, and which the ECB considered a Ponzi scheme as recently as November 2012:

Last but not least:

Of course it does. Why? For two simple reasons:

  • First, as noted above, cash and NIRP simply do not mix as cash provides the general population a handy way of circumventing the intentionally punitive implications of negative rates, which as a tax on all savers, would force everyone to spend savings the moment these were created. The thinking here, of course, would be that with savings immediately converted to consumption, the velocity of money would surge and boost economic growth in the process even if it was conducted under punitive rate duress.
  • Second, and even more important, is the blockchain basis of bitcoin, which is precisely why the Fed is so fascinated by it. With a perpetual and current ledger of every single transaction in the monetary domain, a digital currency such as bitcoin provides the Fed something cash never would - a constant database (or ledger) of every single transaction everywhere and any given moment.

It is the second aspect of bitcoin that has led to such recent headlines as "Big banks consider using Bitcoin blockchain technology" and, of course, Bloomberg's piece from September 1 in which "Blythe Masters Tells Banks the Blockchain Changes Everything."

Yes it does, and especially in a world in which the Fed regulates all blockchain transactions under a negative interest rate regime: quite simply, the combination of blockchain and NIRP give the Fed supreme control over all transactions.

Simply said: bitcoin under NIRP is a Fed match made in heaven.

There is just one small hurdle - eliminating cash as a transaction medium entirely. However, considering the US experience with confiscating monetary intermediates most recently observed with Executive Order 6102 when FDR confiscated all US gold, will the Fed allow such a little "problem" as "sequestering" available cash stand in the way of NIRP dominance? Of course not, especially if the alternative is the complete loss of central bank credibility.

Which, in a nutshell, is what Kocherlakota's negative interest-rate dot unleashed: a world in which the existing cash/ZIRP paradigm becomes blockchain/NIRP (and where the Fed is aware of every single transaction).

And, before you ask, will there be substantial - and violent - opposition to the Fed's mandatory conversion of cash to bitcoin? Of course. But that too certainly not stop the Fed, which fighting for the survival of trillions in legacy "wealth" would simply steamroll over anyone and anything courtesy of the US government's armed backing (which has conclusively proven in recent years its function has metastasized to serve only the wealthiest corporations and Wall Street interests) to preserve such wealth, if only for a little longer.

 

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Fri, 09/18/2015 - 15:07 | 6566429 Budnacho
Budnacho's picture

Yeah....Once the Cash goes so will the Fed....at gunpoint.

Fri, 09/18/2015 - 15:10 | 6566444 Money Counterfeiter
Money Counterfeiter's picture

This will not end until the fascist are hanging at the end of a rope.

Fri, 09/18/2015 - 15:24 | 6566512 LawsofPhysics
LawsofPhysics's picture

^^^every single Fed governor and politician that facilitated this fraud.

nothing changes otherwise.

Fri, 09/18/2015 - 15:27 | 6566523 Deathrips
Deathrips's picture

The Fed removes the lube for the middle class...and exponential fuckings commence?

 

Just a guess.

Long Physical, Short WTI paper for fun.

RIPS

Fri, 09/18/2015 - 16:03 | 6566689 negative rates
negative rates's picture

Companys and countries go through bankruptcy, it's an ugly job, but somebodys got to do it.

Fri, 09/18/2015 - 17:06 | 6566975 realmoney2015
realmoney2015's picture

It's hard to believe people actually beileved that the fed was going to raise rates. They won't raise rates EVER! They will start a new money printing scheme, whether they title it QE4 or not, before they raise rates. At this point I think a movwe of 25 base points in the wrong direction is more likely.

Stack on ZHers!

Fri, 09/18/2015 - 17:57 | 6567144 Scooby Dooby Doo
Scooby Dooby Doo's picture

Hey Gang! It's Scooby time!

Lets start with a Scooby singalong, ok?

Scooby Dooby Doo where are you?
I'm down at the bank doing a HELOC!

And Scooby Dooby Doo why are you doing that?
It's time for 'merica to start spendin'.

Hey gang let's do this thing. Lever up you stoopid fin-dummies!

Fri, 09/18/2015 - 19:00 | 6567299 Mr. Ed
Mr. Ed's picture

Trial balloon? Staged neg interest rate question @ presser + FOMC hint at NIRP meant to trigger discussion and analysis in forums, news and social media... just so the Fed, Deep State and others could look for potential roadblocks to their plans?  And, to see what they could likely get away with.

Fri, 09/18/2015 - 17:08 | 6566987 messymerry
messymerry's picture

Oh!!!  PLeeze, pleeze let me be there when you 'perp' walk them in their chic little orange jumpsuits to the SLAM!!!

;-D  

Fri, 09/18/2015 - 22:25 | 6567902 ThroxxOfVron
ThroxxOfVron's picture

"The Fed removes the lube for the middle class...and exponential fuckings commence? "

 

As if lube would matter when the the evil bankster clydesdales are laying into you.

ZIRP on your deposits and your credit cards will still be compounding away @ 14.99%

...& You are dreaming if you think submarine variable interest rate mortgages are going to be handed out to anyone that doesn't already own skycrapers and rolling acres..

Fri, 09/18/2015 - 15:25 | 6566517 MANvsMACHINE
MANvsMACHINE's picture

Just a crazy thought here but how about precious metals as a store of wealth?

I know, I'm a bit of a loon but just sayin'.

Fri, 09/18/2015 - 18:47 | 6567293 gatorengineer
gatorengineer's picture

If you havent noticed they are trying hard to break that market.

Sun, 09/20/2015 - 15:18 | 6571983 Cadavre
Cadavre's picture

"This will not end until the fascist are hanging at the end of a rope."

 

Time for an honesty check. The "lost in the world of bling and empty vanity" dummies you call "fascist did not make this happen. We, the commons, allowed it to happen. The person to blame is the one who stares back at us with apothetic eyes from the mirror.

Be empathic. Fools are fools because their genetics failed them. The bad guys are the defense kapo running their games from the K-Street kiidie brohels. 

The logic of being civilized means ending capitol "ruse of law" cons, like the death penalty. We only need to restore the "rule of law". The weak edict slingers our apathy allowed to deliver the precarious moment we find ourselves in is our fault.

That being said, the imagery of Mussolini and his whore hanging by their heels is  appealing, but not very productive, helpful, or civil.

It's our fault this has happened. We allowed them to caste us into the feudal designation, "consumer", when, infact, the commons is the only producer of wealth. Presidents, senators, etc, etc, are not our leaders, or our rulers. They are our employees, and we got lazy, and forgot to ensure they read the corporate policy and corporate operations manuals.

I am not saying the politicos will not have to do time in a reducation center. But the ease with which we allowed capitol punishment to be the answer, the false logic that state revenge by murder is a useful tool of governance is a false failed logic.

Restoring the "rule of law" and ending the "ruse of law", and thus a rebirth of the United Staes of America, through aborting the malignant "United States of Defense Contractors" is the goal. Not vengeance (although the . mousolini hanging by his heels" does seem fun), we need to first accept that we caused/allowed this to happen. And then we just need to understand that there are 3 hundred million of us and just a pocket full of lint, by comparison, of them.

We are the empowered, the powerful, both by the rule of law, and physics of sheer mass.

Politicians are not rulers, they are employees hired to administrate the common's authorizations, meaning, the body politic known as the 'commons' is the only leadership.

Ww need a plan, a manifest, of sorts, that will convince the weak, operating under the blind logic of vanity we see on CSPAN, to surrender their assets, licenses and passports and accept house arrest while a provision government quickly reestablishes a threshold fot the nation to restore the rule of law.

Direct democracy is the only democracy that assure the commons' will will be done.

But behaving like those poor fools we apapthetically and vainly allowed to put their shorts on backwards for the Genocide Banks, is just repeating - recycling - the false logic that delivered this moment, looks like a bad idea. WE THE COMMONS, RULE AND OWN THIS SHIP OF STATE AND EVERY ASSET ON IT. AND WE CAN TAKE IT BACK AS SOON AS WE REALIZE HOW EASY THAT CAN BE DONE. 

Lets get smart. We've been in a stupor way too long.

Fri, 09/18/2015 - 15:13 | 6566463 tarsubil
tarsubil's picture

Exactly, how in the hell are they going to actually ban cash? That seems like just a little too much. I can see them doing NIRP until they see people emptying their savings accounts. Yellen commented about how she was surprised that slightly NIRP didn't lead to empty savings accounts. We really are in the twilight zone.

Fri, 09/18/2015 - 15:21 | 6566505 Hype Alert
Hype Alert's picture

There might be a run on gift cards.  Would work like a cashiers check.

Fri, 09/18/2015 - 18:30 | 6567249 Bernoulli
Bernoulli's picture

NIRP in Switzerland is reality and not so much has changed for the "normal" people.

But then once it changes, it could go quickly.

My guess is it starts at minus 1% or minus 2% that average Joe will move to cash.

Thank god in Switzerland there are thousand Franc bills. Not so much hassle with the big bundles of hundreds...

Fri, 09/18/2015 - 15:35 | 6566567 hannah
hannah's picture

ban cash...? who exactly has cash these days except the wealthy. i seem to wait in line at the bank behind idiots that have 2 cents in their accounts. find 10 people that actually have cash 3 days after they get paid....

Fri, 09/18/2015 - 17:11 | 6567000 Miffed Microbio...
Miffed Microbiologist's picture

I have a significant amount of cash relative to my income outside of the banking system that I have been stockpiling for years. Plus PMS and barterable items ( Mr has experience in construction, slaughtering and farming.) Believe me, I had to forgo a lot of things to do this.

Living off the grid for a month in 2002 woke us up. There is no way if disaster, economic or natural, were to happen there would be enough support for all. The window for preparations is closing.

Miffed

Fri, 09/18/2015 - 17:45 | 6567106 Implied Violins
Implied Violins's picture

Ummm I wouldn't capitalize p.m.'s there...otherwise, right on. This weekend or next could very well be the last great chance to stock up while our debit cards still work.

Fri, 09/18/2015 - 20:32 | 6567609 Bananamerican
Bananamerican's picture

"Living off the grid for a month in 2002 woke us up"

can you elaborate a little more on this Miffed?

are you saying it didn't go well?

Fri, 09/18/2015 - 22:05 | 6567851 Miffed Microbio...
Miffed Microbiologist's picture

In 2002 the Cedar fire ( largest in cali history) was started by a moron near our home. At 1 AM a wall of flames lipping the tops of the telephone polls came barreling down on us and we barely made it out alive ( several families burned to death west of us, they had no idea what was coming)

We managed to make it back in to our home ( the area was a smoldering moonscape) we had no power, heat, phone or water ( our well pump requires electricity) Looters were having a hayday taking advantage so we had to fend them off. Because we had a small generator we did better than most. My neighbor lost $400 worth of meat ( gave it away so it wouldn't go bad). Everyone in our area lost their hay except us. We had 5 tons. That became a precious bartering commodity but those who had nothing to trade, we gave some to them anyway. Funny how months later I'd come home to a stack of bales and never knew who gave them to me, I never asked for repayment.

Living without these things for a month was quite a personal as well as a societal education. You find out who your friends are quickly. I started prepping more in earnest after that event.

Miffed;-)

Sat, 09/19/2015 - 00:03 | 6568152 Bananamerican
Bananamerican's picture

Looters? east of Sandy Eggo?

Quien?

Were there surprises in the "find out who your friends are" Dept?

On a side note: I find it amazing we haven't had too bad a time of it yet relative to the drought....

Sat, 09/19/2015 - 09:32 | 6568760 fstwrtr
fstwrtr's picture

Thats actually an encouraging story. One whould assume you would come home to people attempting to liberate you from your stores, after hearing you had undamaged assets...Prepping should be part of everybodys program.

Fri, 09/18/2015 - 21:01 | 6567701 jerry_theking_lawler
jerry_theking_lawler's picture

Same here. Katrina woke me up. No 911 to save you, no fuel, no electricity, little water, no new food coming in.  Just you and your friends...all armed and protecting property(land, food, fuel, generators, etc)....with it being known to draw first ask questions second.  Really enlightening but not as much 'fun' as people think the chaos will be...

Fri, 09/18/2015 - 15:58 | 6566660 Chupacabra-322
Chupacabra-322's picture

Friday news dump. These Criminal Psychopaths are going to close shop in the future & the uneducated Zombies will starve for a solution from the very Elite Criminals who produced the calamity.

Fri, 09/18/2015 - 16:21 | 6566780 Implied Violins
Implied Violins's picture

I think the zombies will realize quickly how good lead-infused, rope-burned, drawn and quartered bankster/politician meat tastes, and (hopefully) develop an insatiable appetite for it (...but they *would* be missing out on brains).

Fri, 09/18/2015 - 17:12 | 6567005 messymerry
messymerry's picture

I disagree, too fatty.  ;-D   

Fri, 09/18/2015 - 18:38 | 6567272 Implied Violins
Implied Violins's picture

Ketogenic diets are the healthiest. In this case, though, lead poisoning could be an issue...

Fri, 09/18/2015 - 22:29 | 6567915 ultimate warrior
ultimate warrior's picture

Cash can not and will not be banned! Why do I know this? Because the government makes drugs/prostitution/gambling/etc illegal. How else will people be able to pay for these things? Either the government will have to  make everything legal so there is no black market or everyone in the world will have to stop using drugs or banging prostitutes for this cashless society to work. I just don't see either of these scenarios happening. 

Fri, 09/18/2015 - 15:07 | 6566432 ghostzapper
ghostzapper's picture

Wow - ZH throwing around the term "blockchain" like they're at an MIT kegger.  I like it.

Fri, 09/18/2015 - 15:20 | 6566498 Tinky
Tinky's picture

Very good horse, but Frankel was cheating.

Fri, 09/18/2015 - 15:26 | 6566520 ghostzapper
ghostzapper's picture

Not in a position to comment on that.  Won in brilliant fashion at multiple distances.  Injuries blocked a BC Sprint and back to back BC Classics.

Fed knows about bubbles - Bitcoin/Blockchain/Fintech are sitting there on the tee waiting to be inflated.  

Fri, 09/18/2015 - 16:17 | 6566761 Tinky
Tinky's picture

Unquestionably he had a ton of talent.

Fri, 09/18/2015 - 15:50 | 6566634 Seasmoke
Seasmoke's picture

And it looks like he passed it on to Chad Brown. 

Fri, 09/18/2015 - 15:07 | 6566433 I woke up
I woke up's picture

Be your own bank

Fri, 09/18/2015 - 15:41 | 6566596 robertocarlos
robertocarlos's picture

Back of Carlos. I love it. I'm gonna need an engraver and a printer and some linen paper. I don't want any assholes counterfeiting my bills. I promise not to print more than I need.

Fri, 09/18/2015 - 16:05 | 6566697 nyse
nyse's picture

I TRUST YOU!

Fri, 09/18/2015 - 17:50 | 6567120 mademesmile
mademesmile's picture

BYOB

Fri, 09/18/2015 - 15:09 | 6566442 NDXTrader
NDXTrader's picture

TPTB have probably shaken enough people today. As much as it pains me to say it - probably the buying opportunity of the year here. We are going much higher - more BOJ and ECB QE soon

Fri, 09/18/2015 - 15:10 | 6566446 dexter_morgan
dexter_morgan's picture

Maxine Waters is onboard, so you know it is good.

 

GOY LIVES MATTER

Fri, 09/18/2015 - 17:40 | 6567097 Ward cleaver
Ward cleaver's picture

U have to ask yourself why buffalo waters is so interested in ZIRP. Her constituents certainly r not active in the "markets" so what is her agenda?

>. She gets donations for her "community endeavors" paid for by the banksters

>. She is so stupid she has no idea what's going on but likes to hear herself talk

>. Husband has a rooting interest

>. She needs market to stay high thru elections

>. You don't give a shit

Fri, 09/18/2015 - 15:11 | 6566453 farmboy
farmboy's picture

For sure there will be unforseen consequences but.

1. It will lead to bankruns depleting capital for the banks and shorten balance sheets as everybody pays down debt as much as possibile = banking crises

2. Insurance companies/banks/pension plans go bancrupt = banking crises.

We are doomed if they raise rates and doomed if they lower rates and doomed if it stays the same. Good job there are no good outcomes must be a Ph D to come with this.

Fri, 09/18/2015 - 15:12 | 6566456 WTFRLY
WTFRLY's picture

They are just working it for the big nut, downward motion first before they hike deeznuts.

Fri, 09/18/2015 - 15:13 | 6566462 Gunga
Gunga's picture

They won't stop of their own free will. We have to defend ourselves.

Fri, 09/18/2015 - 15:14 | 6566464 WTFRLY
WTFRLY's picture

If the Fed doesn't play "politics", it's going to be a long 12 months until the election.

Fri, 09/18/2015 - 15:14 | 6566466 N57Mike
N57Mike's picture

"Pandora was a woman who lived with her husband in a paradise and was given a beautiful box for safekeeping with the caution that she ought not to ever, ever open it. For a time she remembered and kept her promise to not open the box but eventually succumbed to the temptation and decided to have a peek. The lid flew open as soon as she raised it and a swarm of imprisoned evils flew up and out into the world inflicting pain, greed, envy and manner of suffering on all they found."

"Pandora and her husband Epimetheus were also the victims of all these ills, knew they were responsible for the suffering and were grieving their part in it while sitting near the box. In the midst of their lamenting, they heard a small voice crying out from the box, "Open, open, and I will heal your wounds! Please let me out!" and while at first they were afraid to open it and possibly release even more troubles, they eventually decided to see who the plaintive voice came from. They fearfully opened the box and found a small bright-winged beautiful creature. It was well for Pandora that she opened the box a second thim, for the gods, with a sudden impulse of compassion, had concealed among the evil spirits one kindly creature, Hope, whose mission was to heal the wounds inflicted by her fellow prisoners"

Fri, 09/18/2015 - 15:21 | 6566502 Tinky
Tinky's picture

You somehow neglected to mention that it was also the name of my first cat.

Fri, 09/18/2015 - 15:27 | 6566524 MANvsMACHINE
MANvsMACHINE's picture

I don't get it.  Was the box some sort of radio device that played music?

Fri, 09/18/2015 - 15:45 | 6566611 crazybob369
crazybob369's picture

And my first girlfriend. Wonder whatever happened to her.

Fri, 09/18/2015 - 15:27 | 6566519 Sorry_about_Dresden
Sorry_about_Dresden's picture

Interesting qoute!!!!

The source???? I do not remember hearing about 

one kindly creature among the evil spirits

Fri, 09/18/2015 - 15:46 | 6566615 DollarMenu
DollarMenu's picture

Hope can be as toxic a demon as the others.

That is why it was imprisioned in the box with them.

Fri, 09/18/2015 - 20:58 | 6567692 Lurk Skywatcher
Lurk Skywatcher's picture

Should be renamed "Obama's" box... hope and all that shit.

Fri, 09/18/2015 - 15:42 | 6566602 JRobby
JRobby's picture

Oh, she opened it in 1913? I thought it was long before that?

Federal Reserve Act does not work effectively without the Internal Revenue Act. You need to extract taxes from the "citizens" if you want to issue GOVT DEBT 

Sat, 09/19/2015 - 04:49 | 6568516 The Merovingian
The Merovingian's picture

But then Hope met Change, a gangly, delusional,half-breed spirit filled with derision and deceit. Change corrupted Hope into a twisted, gnarly and toothless meth-wracked whore that became totally dependent on the system and absolutely incapable of ever recovering her lost virtues.

In the end Hope's lost twin Vengeance took Change down to the corner where he publicly flogged and beat Change senseless before stringing him up with a freshly made, well soaked hemp rope.

Oh shit, sorry .... I hate it when my inner voice just pops out like that.

Fri, 09/18/2015 - 15:14 | 6566468 Sorry_about_Dresden
Sorry_about_Dresden's picture

Is it just me or does anyone else suspect Yellen's choice of attire might send a  subliminal, or even overt, signal, message for those fortunate enough to be in the know??????

I mean come on!!!!! Jet Black dark SITH suit with 24 carat gold accessories!!!!!!!???????

Her outfit was screaming "LIQUIDATE EQUITIES AND BUY HARD ASSETS HAIRCUT IMMINENT!!!!!!".

It is more than interesting that ZH is not throwing 100 stories at the sell off???????? WTF!!!!!!!

I would love to hear any readers comments on Janet's wardrobe choice.

Do you think the wardrobe said more than all the words of her press conference??????? Was her outfit the main signal to her PRIMARY DEALERS?????

I google imaged Janet and the suit looks similar to outfits she has before but, come on!!!!!; something about what she wore during her press conference was particularly disturbing to me!!!!! 

Did anyone else get that vibe?????

Anyone?........anyone?.....Beuller????

Here is a portent from December 2014. Nothing new to see here folks! Move along!

http://conservativehideout.com/2014/12/10/thank-you-janet-yellen-new-fed...

Fri, 09/18/2015 - 15:19 | 6566491 Eyeroller
Eyeroller's picture

Every time I see the Ponzi Munchkin, I picture her cutting her own hair with a bowl on top of her head.

Fri, 09/18/2015 - 16:48 | 6566907 delacroix
delacroix's picture

I wonder if the phrase "lipstick on a pig" ever crosses her mind, when she's doing her makeup?

Fri, 09/18/2015 - 16:53 | 6566915 813kml
Fri, 09/18/2015 - 16:11 | 6566727 mademesmile
mademesmile's picture

I thnk its just you, but hey, that's OK

When she comes out wrapped in a tunic made in $100 bills then I might think she's sending a signal.

For sure if she's wrapped in bond certs.

Fri, 09/18/2015 - 17:07 | 6566947 pFXTim
pFXTim's picture

.

Fri, 09/18/2015 - 18:08 | 6567186 BadDog
BadDog's picture

I noticed it too.  She looked appropriately dressed for the cocktail hour just before the child sacrifice in the lower chambers of the grand estate.  All hail...

Prostrate yourselfs before negative interest rates, ban on cash and the chip.

Fri, 09/18/2015 - 15:14 | 6566470 SgtShaftoe
SgtShaftoe's picture

Many of the largest and profitable US corporations are looking more like a self-liquidating trust than a business these days.  Stock repurchases turned to stock options for the execs will continue to increase fueled by cheap debt.  The US productive sector will be hollowed out further until there is nothing left.  The middle class will collapse and at some point people will reach a breaking point.  Then all hell will break loose.  Good times.

Fri, 09/18/2015 - 15:17 | 6566477 QQQBall
QQQBall's picture

The real rate is what matters. If you can vulture up good deals, then the spread will be really juicy. But if you gonna run out and pay market prices competing against people who cannot stay in cash and wait for prices to normailze, whcih will require a dip well below the mean, then you lose regardless.

Fri, 09/18/2015 - 15:18 | 6566482 QQQBall
QQQBall's picture

when can we ask Ben - Are we better off than 2007-2008?

Fri, 09/18/2015 - 15:18 | 6566485 lordbyroniv
lordbyroniv's picture

Hulk head hurtz

 

:(

Fri, 09/18/2015 - 15:19 | 6566493 the grateful un...
the grateful unemployed's picture

all bond auctions are conducted at par or higher

Fri, 09/18/2015 - 15:22 | 6566496 falak pema
falak pema's picture

what happens next?

The Cbs have now become partners in proposing "bail ins" to the TBTF banks WHO WANTED THE FED TO RAISE INTEREST RATES BY 1% SO AS TO EARN MONEY BY DEPOSITING THEIR MONEY WITH THE FED! Easy pickings!

Read this :http://www.nakedcapitalism.com/2015/09/wolf-richter-bankers-threaten-fed...

Wolf Richter that ZH knows well wrote that.

Its time for block chains to cut off the TBTF from the money chain; before the TBTF take over the block chains themselves!

Fri, 09/18/2015 - 16:17 | 6566760 LawsofPhysics
LawsofPhysics's picture

too late!  Fuck, I knew a smart individual who went to work for JPM on cryptocurrenices back in 2001.  They knew what was coming, cashless bitchez..

fuck that.  restore the rule of law first motherfuckers.  Show me the legers first and mandate GAAP for everyone's books, including the Fed's.  Make certain financial crimes punishable by death and THEN I might be willing to play again.  Fuck em.

Fri, 09/18/2015 - 18:03 | 6567167 Hankster
Hankster's picture

GAAP for the Fed? Hell NO!
first order of business in restoring the rule of law is to END the FED!

central bank = central planning = FAIL

Fri, 09/18/2015 - 23:02 | 6568006 TheReplacement
TheReplacement's picture

The Fed is private.  He said Feds, as in Treasury and such.

Sat, 09/19/2015 - 02:42 | 6568405 StychoKiller
StychoKiller's picture

Apparently, you don't know how apostrophes work.

Fri, 09/18/2015 - 15:21 | 6566504 polo007
polo007's picture

http://news.goldseek.com/GoldSeek/1442494200.php

Try making up for a past mistake and make another? That’s playing from behind, if you will, and it’s not out of the question if you know the Fed’s history:

1. Not a single post-war recession has been predicted by the Fed a year in advance, according to former U.S. Treasury Secretary Lawrence Summers; and

2. Neither of the last three recessions were recognized until they were already under way.

Incompetent or ulterior motives for policy?

Regardless, here we are with expectations ramped up for a rate hike, as the rest of the world is easing.

What’s notable for investors is that since the 2008 crash, we have not been able to achieve new market highs without central bank stimulus. Full stop.

But it’s only a quarter point…

According to a study released by McKinsey Global Institute in February of this year, global debt has increased by $57 trillion USD since 2008. With such an enormous amount liquidity in the system (M1 money supply near lifetime highs) financial markets are increasingly becoming nothing more than a currency game; and the currency game is a relative one. I print, you print, they print, but who’s printing more and where is capital flowing in and out of? Within this context, a quarter-point rate hike would be much more than simply symbolic.

As we have seen since late 2012, the rise in the U.S. dollar has had major implications on global markets, whether it be currencies, commodities or interest rates. A rate hike would equate to further USD strength and will accelerate the deflationary spiral we have witnessed over the past few years. Raising rates into a slowdown could also place the U.S. firmly on a path to recession in 2016.

Conversely, no rate increase does not meet the expectations set by the Fed and will re-inflate commodities in the immediate term. Arguably, it pulls forward the possibility of QE4 as well.

So it seems the Fed finds itself in a self-imposed conundrum here: make a policy error and raise into a slowdown, don’t raise and openly recognize growth is slowing. Which brings me back to my previous point: since 2008, no new market highs have been achieved without central bank stimulus.

As always, government remains the No. 1 risk to financial markets, and I will change my views as the facts change.

“The Federal Reserve is not currently forecasting a recession.” – Ben Bernanke (January 2008)

Fri, 09/18/2015 - 15:34 | 6566561 Sudden Debt
Sudden Debt's picture

They do print a shitload indeed but like Mike Maloney once explained in one of his vids of the creation of money or something, money is created when people take out loans.

And that was where our society got wealthy from the 90's on.

But once people can't take out more loans... that system goes into reverce and money is destroyed, it vanishes into thin air.

And the printing presses isn't just to fund the banks but to prevent the entire money system from imploding.

And what we're seeing now is that countries are now also, like average joe, up to their necks in debt.

So now we're stuck. They're stuck.

And what we'll see happening now if there isn't a QE4 soon, is that defaltion will get really bad for a short time and the money system implodes.

A credit crisis of epic proportions!

And to counter it, they'll need to print and print at hyperspeed because once the implosion starts, it's like a black hole.

And they'll print so extremely, that eventually, they'll hyperinflate. 

 

Fri, 09/18/2015 - 17:05 | 6566971 Kayman
Kayman's picture

Printing money and punching up credit through fractional reserve banking is a delicate conjuring trick. It is an immediate claim to existing assets, but the repayment (with interest) requires the creation of new assets (growth in the economy) or inflation of old assets.

To the extent that new credit/new money exceeds the capacity of the economy to grow or the willingness of all participants in the economy to "buy in" to the spending of money "for the sake of spending" then the conjuring game fizzles.

Many of us are refusing to play the rigged game.  I have extinguished all my debt and refuse to borrow again.  I watch friends lighting one cigarette from the end of another worrying themselves over borrowing money for ideas that turn to shit, or buying crap they never needed in the first place.  

The game is rigged. Big Business, Big Government, and criminal bankers can print/ conjure and borrow until this game ends. In the meantime, I will do as little as I can to help the economy.  And whenever anyone asks, I tell to shrink their footprint, fight the feeling and go lay down for awhile.

By the way, why don't our overlords stop calling it a "Credit" rating when it is a "Debt" rating. 

 

Fri, 09/18/2015 - 17:58 | 6567146 OC Sure
OC Sure's picture

You are almost close. However, the acceptance of a false premise has misdirected you to an incorrect analysis. 

Banking is banking. Fractional Reserve [Banking] is not banking. Banking is honest, productive, and just. Fractional Reserve Counterfeiting is not honest, productive, or just. 

That productive work must be performed in order to return the currency plus interest is true. However, if the currency loaned is counterfeit, the imitation of productive work (i.e., it does not already exist), then its return  is the facilitation of theft. If the currency loaned is money, the representation that productive work has already been performed (i.e., it already exists), then its return is the facilitation of investment. 

Counterfeiting is not the imitation of the currency. 

Counterfeiting is the imitation of the productive work required to make the existence of any currency necessary at all. 

 

(Furthermore, that conjured currency can be allocated into any direction possible causes it to be allocated into any direction possible, and not necessarily the most appropriate direction. Theft cares not of investment.)

Fri, 09/18/2015 - 18:37 | 6567267 Bernoulli
Bernoulli's picture

Hence the 2% inflation HAS. TO. BE. ACHIEVED.

To keep the ponzi going.

In a deflationary environment, this sucker will go down.

Fri, 09/18/2015 - 15:24 | 6566514 coast
coast's picture

I wanted to post a moment on this shemitah thing.  I will try to brief (yeah right)....911 for instance, yes thousands died and I feel for their loved ones much, my 17 year old step daughter died a couple of years ago, and I know the pain.  Let me put that aside for a moment, altho with tears in my eyes.  Lets just look at what happened.  After 911, hundreds of thousand if not millions died in the middle east, many women and children.  911 was used an excuse to destoy Iraq, Libya, etc and now Syria.  It was used to start the NDAA, arrest with no warrant and no bail etc. etc.  Are you getting my point now?  Just because the world did not come to an end after 911, or after 2007/2008 crisis, look what was the outcome.  What I am wondering now, is what will be the outcome from this shemitah....Are you understanding this now?  love you all...(well not all of you, but most of you, and I really have a crush on honestann)  :-)

Fri, 09/18/2015 - 16:03 | 6566688 Sorry_about_Dresden
Sorry_about_Dresden's picture

Is this what you are talking about?

America was consciously, intentionally and specifically founded after the pattern of ancient Israel. Its Founders saw it as a new Israel, the Israel of the New World. The New World was their new promised land, and the Massachusetts Bay was their New Jerusalem. Jonathan also says the legal system, the mountains of America, and the Hebrew language taught in school are all things that are linked to the nation of Israel and its foundations.

http://www.charismanews.com/opinion/52065-the-end-of-the-present-2015-sh...

Quite disturbing!!!!!! it is obvious that Israel considers America as one of her provinces.

Fri, 09/18/2015 - 16:30 | 6566816 coast
coast's picture

I am tired of hearing about isreal and the jews...The rothchilds planned this long before all of that. I dont know if the rothchilds are jews or not, but whatever they are, I know they are the seed of satan....Lucifer took Jesus to the mountain and told Him that He could control all the nations...Jesus said no...the rothchilds said "pick me, pick me!"    Then you have to research khazars, then see how the book of revelations said "they call themselves jews but are not jews".   I dont have all the answers, and that is exactly why I am not a jew hater...I dont even have a clue what they are..I look at the rothchild zionists, that is something I can see and understand. Check out david icke and the rothchild zionists..he gives names, pictures, history all in perfect form.  I still give you an up dresden because you are close to the truth...

Fri, 09/18/2015 - 21:08 | 6567202 Sorry_about_Dresden
Sorry_about_Dresden's picture

"they call themselves jews but are not jews

But the jews are the jews my friend!

If there were some evidence of differentiaton between the groups you mentioned I am sure the actual representatives would vocalize their opposition against the imposter? I see no such evidence.

ergo a ligonem a ligonem est

sarc/on

Fri, 09/18/2015 - 17:09 | 6566989 Kayman
Kayman's picture

coast

honestann ?

leave her alone, she's my gal.

Fri, 09/18/2015 - 17:22 | 6567043 coast
coast's picture

maybe we should step outside and handle this like gentlemen...

lol.... he who posts the best gets the prize.. I am gonna beat your ass :-)   Actually I think you will win because I talk about Jesus too much...nobody likes that....

Fri, 09/18/2015 - 15:24 | 6566516 Sudden Debt
Sudden Debt's picture

There is a problem with a cashless society.

Card transactions still cost way to much. 2% up to 5% of the amount.

It's not just the people it's the merchants who don't always want it especially the small amounts.

So if you want to go cashless, you need to break the banks and turn it way cheaper as a incentive to do so.

And that won't happen because they're greedy so they'll fail.

Fri, 09/18/2015 - 15:37 | 6566576 agent default
agent default's picture

The real problem is that people will not like this sort of restriction, especially now that the intentions are becoming clear.  The second problem is the deepening mistrust of government at all levels.  The third and biggest problem is the adoption of regional and private currencies which may eventually be adopted at state level.  But the biggest problem is that IF they ban cash, the moment negative interest rates are implemented, it will be shotgun time.  Not rifles, shotguns.  Much more colorful results.

Fri, 09/18/2015 - 15:45 | 6566613 BernankeHasHemo...
BernankeHasHemorrhoids's picture

So you say.

Fri, 09/18/2015 - 16:00 | 6566679 Sudden Debt
Sudden Debt's picture

I was in the city today passing a primark store... if you see the people comming out of that store with bags of crap, who all know it's produced by children in Indian sweatshops, nasty shit, they don't care. They smiled.

People are sheep. They never give a fuck about anything if everybody else is doing it.

Society has turned us all into following sheep where anybody who dares to walk next to the line, loses his job, becomes a outcast....

I myself am 2 different people. The part people see of me and how I think. I rarely show my true self. I used to, but it isolated me and I changed it.

On the outside, I can blend in society and you'd never notice it.

Don't give people to much credit. As a individual, most can be smart, but in a group, people always act like sheep.

Fri, 09/18/2015 - 16:24 | 6566793 Bemused Observer
Bemused Observer's picture

Has it occurred to you that many of those 'sheep' are in fact, people just like you? Maybe you are just seeing the face they want you to see as well.

You are blending in, at the moment. I have a feeling many of these seeming 'sheep' are doing the same thing.

If that IS the case, well then, I guess we are all just waiting for the spark...

But don't be surprised if, after TSHTF, many of those quiet blenders toss off the sheepskins, and you see the wolves beneath...they were there all along...just waiting for the right moment to reveal themselves.

Fri, 09/18/2015 - 18:52 | 6567303 MSimon
MSimon's picture

Soviet society worked like that. The public and the private.

 

It crashed their system because honesty was no longer a virtue.

 

China operates like that.

Fri, 09/18/2015 - 18:55 | 6567315 agent default
agent default's picture

You have made your own counterargument in the first paragraph.  Exactly, they don't give a fuck about anything AS LONG AS THEIR STANDARD OF LIVING IS PRESERVED.  Negative interest rates will lower their standard of living.  Now people act like sheep when every one is pursuing an individual goal and is willing to make compromises against higher more idealistic and broader concepts.  Screw them collectively out of their money and see that, I don't give a fuck, mentality loose on the streets.

Fri, 09/18/2015 - 15:26 | 6566521 Joebloinvestor
Joebloinvestor's picture

You have been warned.

Cyprus was the test case and don't forget it.

Fri, 09/18/2015 - 15:26 | 6566522 Albertarocks
Albertarocks's picture

"Ten thousand bills take up a lot of space."

No they don't... not even close.

 


Fri, 09/18/2015 - 15:27 | 6566527 TeethVillage88s
TeethVillage88s's picture

You put all of those fuckers in the Docket and Try them for Treason, Sedition, and Racketeering.

The FED is an Inbreed Cartel of Bankers, but the responsibility for the destruction of the American Idea, the American Dream, and the American Middle Class falls on Congress, the Lawyers, the Lobbyist, the Politicians and the Bankers behind them.

- Shut down the US Congress this coming year, let our Defense Department, Emergency Services, and and the various agencies run on their own, Make that a two year shut down of US CON-gress

Total Savings Deposits at all Depository Institutions
2015-09-07: 8,164.3 Billions of Dollars (+ see more)
Weekly, Ending Monday, Not Seasonally Adjusted, WSAVNS,
https://research.stlouisfed.org/fred2/series/WSAVNS

Yep.

But look at the Graph, doesn't even dip in 2007-2010, the rich get richer even in Recession and Financial Crisis.

Just like Carib Banking Centers US Treasury Holdings, sky rocket from 2002 which was broken out as Bermuda and Cayman Islands till it because Obvious the money was flowing there.

http://www.treasury.gov/ticdata/Publish/shl2002r.pdf
http://www.treasury.gov/ticdata/Publish/shla2013r.pdf
(http://www.treasury.gov/ticdata/Publish/mfh.txt)
http://www.bea.gov/newsreleases/international/intinv/iip_glance.htm

Bermuda 2002 = $14 B, then 2013 = $94 B, Today ??
Cayman Islands 2002 = $10.7 B, then 2013 = $66 B, Today ??
Carib Bkg Ctrs, $324.5 Billion USD

Bankers controlling the Federal Government is both RICO, Racketeering, and Treason.

18 U.S. Code Chapter 115 - TREASON, SEDITION, AND SUBVERSIVE ACTIVITIES

§?2381. Treason
§?2382. Misprision of treason
§?2383. Rebellion or insurrection
§?2384. Seditious conspiracy
§?2385. Advocating overthrow of Government
§?2386. Registration of certain organizations

- 1994, Fast Track Authority for WTO Approval
- 1994, NAFTA Treaty,
- 1995, Sub-prime mortgages started
- 1995, Community Reinvestment Act, the Clinton Admin urged flexibility,
- 1995, HUD advocated greater involvement of state and local organizations
- 1996, Start of a Period of Accounting Fraud in USA which continues today
- 1997, M2 Money Velocity Top
- 1998, Brooksly Born Rejected on her concerns on OTC Derivatives
- 1998, Derivatives expanded and were not regulated
- 1998, Clinton's Kosovo War
- 1998, Citicorp & Travelers Insurance Merger
- 1999, Gramm–Leach–Bliley Act (GLBA), End of Glass Steagal Act
- 2001, 911, Hijacked Airplanes flown into buildings, bld 7 federal records and banking data lost
- 2001, US-Afghan War
- 2002, McCain–Feingold Act (G.W. Bush, Campaign Finance, soft money unlimited)
- 2003, US-Iraq War

GINI Index for the United States
2010: 41.12 Index (+ see more)
Annual, Not Seasonally Adjusted, SIPOVGINIUSA,

Income Gini Ratio of Families by Race of Householder, All Races, 2013: 0.448 Ratio (+ see more)
Annual, Not Seasonally Adjusted, GINIALLRF,

Fri, 09/18/2015 - 15:32 | 6566546 stock ene
stock ene's picture
September 23 Asteroid Attack? Sign Up For Email Alerts! Really There is a new telescope system in Hawaii launched in 2015 that is specially set to scan for these type of space rocks.

ATLAS can provide one day's warning for a 30-kiloton "town killer," a week for a 5-megaton "city killer," and three weeks for a 100-megaton "county killer".

 http://www.fallingstar.com/home.php

I suggest that you sign up for alerts, directly from the astronomers.

Also, here is my really cool Asteroid Mass and Energy Calculator, as a download

https://app.box.com/s/ocdlggvieo93cxmw304i 

Using the NASA NEO list you can see a 53 Meter object flew by Sept 15, 2015 at 8500 m/s and less than 3 lunar distances from the earth.    

Using my Asteroid calculator above, it would have had the energy impact of 13 atomic bombs.

Elon Musk ain't that smart.    If he wants to terraform Mars, you need to send comets, not atom bombs, duh!

- See more at: http://nukeprofessional.blogspot.com/2015/09/september-23-asteroid-attac...

Fri, 09/18/2015 - 15:33 | 6566550 K_BX
K_BX's picture

well if they pay me to take their money...

Fri, 09/18/2015 - 15:33 | 6566553 Goldbugger
Goldbugger's picture

Now i know why JadeHelm was setup. There will be such a shit storm of riots.

Fri, 09/18/2015 - 15:43 | 6566607 BernankeHasHemo...
BernankeHasHemorrhoids's picture

Riots? You gotta be kidding me. As long as their satellite dish or cable is working the sheeple do not care about any of this. Just give them more meth and food stamps! You actually believe the nonsense served up by conservative talk radio? There are no hordes of libertarian revolutionaries ready to redeem the blood of their patriot ancestors! The US is a nation of worthless losers.

Fri, 09/18/2015 - 15:56 | 6566647 rejected
rejected's picture

Sad,,,,, but true.

I'm not sure "worthless losers" describes them adequately. 

Fri, 09/18/2015 - 15:58 | 6566673 optimator
optimator's picture

Russia managed 'till the grocery stores had nothing but empty shelves.

Fri, 09/18/2015 - 16:10 | 6566702 10mm
10mm's picture

Bingo,patriot is term used for wars overseas.Here in US, never happen.It should of occured yrs ago, but it's the die on the vine. Enough lamp post talk, off with heads. You have owners, they own everything. And besides, it's football and wings baby.

Fri, 09/18/2015 - 16:41 | 6566867 tarabel
tarabel's picture

 

 

I like football and wings. Great game last night (unless you're from Missouri).

Just because I enjoy the benefits of life in a civilized nation doesn't mean that I'm doing nothing to prepare for the time when all the gears seize up. And I do my civic and moral duty to warn others as much as I can.

But I'm not going to be one of those desperate apparatchiks whose entire life revolves around what the party decides. I'm living my life and enjoying it as much as possible as long as it is possible to do so.

God bless the USA and go Packers. Broncos too.

Fri, 09/18/2015 - 20:31 | 6567606 Hugh G Rection
Hugh G Rection's picture

Word.  

Seahawks to cover and the over.

Fri, 09/18/2015 - 16:14 | 6566743 Bemused Observer
Bemused Observer's picture

A lot will, no doubt. But a lot more will NOT go along, and the unrest they create will negate any supposed positive effects to them of a NIRP.

And don't forget something very important...A large group of conservative Christian types will NEVER take what they see as 'the Mark of the Beast'. The pols who cater to them will make sure they are exempted on religious grounds. Watch for a "Christian revival" as multitudes rush to get their religious exemption, just so they can keep their cash. Do you have any idea how many years it would take for these cases to work their way through the system? And there is also the little matter of the Constitution, which does NOT make any provisions for such a thing. SCOTUS will be working round the clock, for decades, before anything is even close to being settled...A NIRP will NOT last that long if large groups of people are allowed to keep their cash, because those not exempted will see their religious neighbors getting a benefit they aren't.

NIRP only works if EVERYONE is cashless. And they can't eliminate cash quickly enough to make it work.

NIRP will not be a sign of the coming NWO. It will be the unmistakeable sign that the NWO is about to assume room temperature. Hang onto your cash and PM's, because the experiment will be brief, if painful.

Fri, 09/18/2015 - 16:35 | 6566853 tarabel
tarabel's picture

 

 

I think there are just as many people, if not more, who would be upset to have their internet connection severed. You and me included, much as I hate to admit it.

And that goes for every nation everywhere.

 

Sat, 09/19/2015 - 02:52 | 6568413 StychoKiller
StychoKiller's picture

WHY would a libertarian revolutionary need to riot?  Check yer premises.

Fri, 09/18/2015 - 15:37 | 6566573 Bay Area Guy
Bay Area Guy's picture

ZIRP would certainly show that the fecal material had hit the air circulation device.

Fri, 09/18/2015 - 15:38 | 6566583 California Nigh...
California Nightmare-ing's picture

So this time bad news really is bad news.  Surprised it took this long.

Fri, 09/18/2015 - 15:40 | 6566587 debtor of last ...
debtor of last resort's picture

For the first time ever, filling out my tax forms this year, i was asked if i had €1000,- or more cash at hand. Motherfuckers are working on something.

Fri, 09/18/2015 - 15:55 | 6566656 khakuda
khakuda's picture

What country?

Fri, 09/18/2015 - 16:10 | 6566718 debtor of last ...
debtor of last resort's picture

Netherlands.

Fri, 09/18/2015 - 16:12 | 6566733 khakuda
khakuda's picture

Thanks.  And, sorry.  It seems we are all in the same (sinking) boat.

Fri, 09/18/2015 - 16:59 | 6566941 debtor of last ...
debtor of last resort's picture

Hey, you fuck my wife, and i'll bake you some cookies.

Fri, 09/18/2015 - 16:20 | 6566772 LawsofPhysics
LawsofPhysics's picture

Bank ATMs in most American banks were limited to $1,000 per day withdrawals a long time ago.  Dumbasses will let you order as much physical as you want thought using that same debit card.  Well, for now anyway...

Fri, 09/18/2015 - 17:11 | 6567001 debtor of last ...
debtor of last resort's picture

Limited withdrawals came in many years ago over here too. Our irs wants to know wether i spend it or not imo.

Sat, 09/19/2015 - 02:55 | 6568418 StychoKiller
StychoKiller's picture

What was your answer?  HOW could the taxman possibly verify whether you wrote down the Truth?

Fri, 09/18/2015 - 15:40 | 6566589 Latitude25
Latitude25's picture

Paging fonestar.  Your precious is going to be FED controlled.

Also with low savings deposit rates savers are already in negative territory compared to REAL inflation.

Fri, 09/18/2015 - 15:52 | 6566644 crazybob369
crazybob369's picture

I can just see it now. The government's war on cash. Complete with the anti-cash Czar and the Department of Noncash (DON). Should work, after all those other wars are going so well: war on poverty, war on drugs and of course, the war on terror. We should have clear victories any day now. Any day now, any day now,...

 

Look squirrel!!!

Fri, 09/18/2015 - 15:58 | 6566650 khakuda
khakuda's picture

All this because they refused to allow asset prices, education costs, housing costs, etc. to fall to levels in line with flailing average incomes so they would be affordable without needing to go into a lifetime's worth of debt to afford to live.  They had to keep the bank debt whole and are willing to steal, lie, cheat and destroying property rights, freedom and liberty to make that happen.

Isn't it odd that we had FDIC insurance to prevent bank runs and keep money in the banks and now they are contemplating the opposite - encouraging money to move to the mattress.

Fri, 09/18/2015 - 15:57 | 6566664 Legal_US_Immigr...
Legal_US_Immigrant_Citizen's picture

Kocherlakota --> he has never met a QE he didn't like. I wonder what his basis is to think rates will be back to normal after the 2016 elections...

Fri, 09/18/2015 - 16:01 | 6566671 wizteknet
wizteknet's picture

Damn the ants going to get crazy, just had my power turned off then on... U watch! buying a generator... 2

Fri, 09/18/2015 - 15:58 | 6566672 debtor of last ...
debtor of last resort's picture

Better put your money in the bank. Deposits will be CONverted into BlytheCoin, all cash will become null & void.

Fri, 09/18/2015 - 16:00 | 6566677 jakesdad
jakesdad's picture

I don't see how they could ever outright ban cash but capital controls can be implemented w/a keystroke & effectively already are:  the atm already won't let me get more than $500/day from an account w/oughly 100x that in it.  yeah, in theory I can walk into a brick & mortar branch & cash a check for $50k but stopping that only takes about 2 min longer than the atm(s) (not to mention notification to dea, irs & risk of robber... er "civil asset forfeiture" on the drive home).

 

I have little doubt we will see nirp before we see +1% but going to have to ponder this one over the weekend...

Fri, 09/18/2015 - 16:06 | 6566700 PoasterToaster
PoasterToaster's picture

They've lost their fucking minds.  That's all it is.

Fri, 09/18/2015 - 16:08 | 6566707 Mick Shrimpton
Mick Shrimpton's picture

Forget banning cash, NIRP alone would cause Armageddon. Once the average idiot realized what that meant, there would be hell to pay.  If the Republicans were in charge at the time, they would have the excuse to finally abolish the Fed.  If the Democrats were in charge, they would probably do nothing and be banished to the political wilderness for decades.

Fri, 09/18/2015 - 16:09 | 6566716 reader2010
reader2010's picture

The real rate has been negative since 9/11.

Sat, 09/19/2015 - 02:58 | 6568423 StychoKiller
StychoKiller's picture

WHICH year?

Fri, 09/18/2015 - 16:10 | 6566719 kotfare17
kotfare17's picture

USD dies as world currency the moment negative rates are introduced.

USA dies few days later. 

WW4 ensues, since WW3 is under way right now

 

CONCLUSION:

 

Negative rates are never gonna happen

Fri, 09/18/2015 - 16:22 | 6566781 LawsofPhysics
LawsofPhysics's picture

Math is not your strong suit I take it.  In REAL terms, rates have been negative for quite a while.

Fri, 09/18/2015 - 16:34 | 6566846 kotfare17
kotfare17's picture

Banking lives in a nominal world

Fri, 09/18/2015 - 17:36 | 6567083 Kayman
Kayman's picture

Laws

In real terms rates on savings accounts have been negative, likely forever.

In nominal terms negative rates will simply signal to the average joe that the jig is up. Forget endless fees, the bankers are telling you that they are doing you a favor to store your electronic digits; why don't you take your lousy money and get the hell out.

 

Fri, 09/18/2015 - 16:13 | 6566737 Secret Weapon
Secret Weapon's picture

Maybe the state of Texas will set up it's own bank.

Fri, 09/18/2015 - 17:14 | 6567019 wendigo
wendigo's picture

North Dakota does. 

Fri, 09/18/2015 - 16:14 | 6566744 wizteknet
wizteknet's picture

torrent keyword prepper, survival, bushcraft, & solar power?!

Fri, 09/18/2015 - 16:17 | 6566752 TAALR Swift
TAALR Swift's picture

To mitigate Bank runs, TPTB will play the Procedure Game:
E.g. they will sugar-coat the turd by charging ever larger Banking FEES, packaged in a variety of Products and marketed accordingly.

What was that saying again about "No one ever went broke, underestimating..."?

p.s. Since I think I'm learning faster than People, expect AI to be used ever more by TPTB. You have been warned: "Adapt swiftly, or suffer the consequences."

Fri, 09/18/2015 - 16:31 | 6566837 wet_nurse
wet_nurse's picture

Debt jubilee then ban usury. 

Fri, 09/18/2015 - 16:49 | 6566895 wizteknet
wizteknet's picture

should I go to titty bar? tonight hell ye fk u all see u there

Fri, 09/18/2015 - 17:39 | 6567093 Kayman
Kayman's picture

titty bar ?

Friend tells me yesterday that his wife hasn't come across for 2 years- told him to rent one, it's cheaper anyway.

Fri, 09/18/2015 - 16:48 | 6566905 world_debt_slave
world_debt_slave's picture

My question, will Credit Unions be able to not follow banks into NIRP?

Fri, 09/18/2015 - 17:40 | 6567095 Clowns on Acid
Clowns on Acid's picture

How about the Bank of North Dakota?

Fri, 09/18/2015 - 18:09 | 6567188 world_debt_slave
world_debt_slave's picture

Interesting, as ND did not follow the collapse of the regular banking system.

Fri, 09/18/2015 - 16:59 | 6566942 Womb Service
Womb Service's picture

I'm confused. How is the Fed going to control Bitcoin, or apply usury to it? The blockchain doesn't support fractional reserve anything, or phony warehouse receipts. I'm not that tech saavy. Someone explain.

It sounds like Bitcoin is actually a great way to escape NIRP.

Fri, 09/18/2015 - 17:13 | 6567013 TheFutureReset
TheFutureReset's picture

You are correct. The author is the one confused about it. 

Fri, 09/18/2015 - 17:22 | 6567046 In.Sip.ient
In.Sip.ient's picture

The FED is interested in Bitcoin "like",

not actual BitCoin per se...

 

The block chain concept from the FEDs point of view

is a central currency database THEY control.  The BitCoin

block chain is a "distributed" entity.  A small but critical

difference.

 

Of course the article also ignores, real BitCoin, base metals

( nickel and copper for eg ) and of course silver and gold

on the theory they can suppress the price of "resources"

forever... lets see that one... LOL

 

And something I learned in Italy... BARTER!

Thats was the primary vehicle Italians used

VERY EFFECTIVELY to circumvent the idiot

politicians and the constant devaluation of

the Lire.

 

 

Fri, 09/18/2015 - 17:01 | 6566950 numapepi
numapepi's picture

What's next?

When that fails the FED will force everyone to get a mark on their forehead or wrist else not be able to buy or sell...

Fri, 09/18/2015 - 17:29 | 6567069 enloe creek
enloe creek's picture

That mark is your cell phone.

Fri, 09/18/2015 - 17:10 | 6566995 TheFutureReset
TheFutureReset's picture

This author obviously doesn't understand bitcoin, or the Fed's comments. They aren't interested in bitcoin itself, only copying the tech for their own uses. There are over 600 copies today, all with their own blockchains.

Bitcoin can't be taken over by them. If they use the tech, it will only boost bitcoin's legitimacy in the eyes of big money. 

Fri, 09/18/2015 - 17:13 | 6567006 Youri Carma
Youri Carma's picture

Everybody who asks this question will be laughed at now: “Will the FED raise rates in December?”

Fri, 09/18/2015 - 17:18 | 6567028 blindman
blindman's picture

the answer is no, laughter or not.
the stealing will continue until the
the world is sufficiently conquered and
controlled and that will never be.

Fri, 09/18/2015 - 17:14 | 6567020 blindman
blindman's picture

"this note is good for all debts public and private"
hilarious , send them to the irs and they will
audit your ass. the pool of insane nonsense is
our breeding ground round here.

Fri, 09/18/2015 - 17:15 | 6567024 Fenix
Fenix's picture

Fed's mandatory conversion of cash to bitcoin

===

How much bitcoin would be worth then? $1 000 000? $10 000 000?

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