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The War on Cash is Real
Stocks have rallied over the last 10 days in part by ECB President Mario Draghi’s statement that if push comes to shove, the ECB will push interest rates even further into negative territory (NIRP).
This represents just another round in the War on Cash, first implemented by the Central Banks in 2008.
It’s a little known fact that the cause for the gut-wrenching collapsing in late September-October 2008 was due to a significant portion of investors trying to move their money out of money market funds.
A money market fund takes investors’ cash and plunks it into short-term highly liquid debt and credit securities. These funds are meant to offer investors a return on their cash, while being extremely liquid (meaning investors can pull their money at any time).
This works great in theory… but when $500 billion in money was being pulled (roughly 24% of the entire market) in the span of four weeks, the truth of the financial system was quickly laid bare: that digital money is not in fact safe.
Remember, the bulk of money in the financial system is digital.
1) The total currency (actual cash in the form of bills and coins) in the US financial system is a little over $1.36 trillion.
2) When you include digital money sitting in short-term accounts and long-term accounts then you’re talking about roughly $10 trillion in “money” in the financial system.
3) In contrast, the money in the US stock market (equity shares in publicly traded companies) is over $20 trillion in size.
4) The US bond market (money that has been lent to corporations, municipal Governments, State Governments, and the Federal Government) is almost twice this at $38 trillion.
5) Total Credit Market Instruments (mortgages, collateralized debt obligations, junk bonds, commercial paper and other digitally-based “money” that is based on debt) is even larger $58.7 trillion.
6) Unregulated over the counter derivatives traded between the big banks and corporations is north of $220 trillion.
The Central Banks like it this way because they can regulate and control digital money much more easily than physical money. Moreover, as the 2008 money market fund collapse revealed, if a significant percentage of investors ever moved to shift their wealth into physical cash it could implode the financial system.
For this reason, the Central Banks are slowly pushing to implement reforms that will either tax physical cash or ban it all together.
The first round of this involved implementing NIRP (negative interest rate policy), which is a form of stealth tax as it charges depositors for sitting in cash.
However, things are getting more aggressive. France just banned any transaction over €1,000 Euros from using physical cash. Spain has already banned transactions over €2,500. Uruguay has banned transactions over $5,000.
Aside from actually banning physical cash, some public services are no longer accepting cash as payments.
Last summer, London buses stopped accepting money. To pay your fare, you now have to wave either a prepaid Transport for London Oyster card or a contactless payment bank card at a receiver. For some, not having to dig out a handful of coins is a welcome relief.
Source: Bloomberg View
Make no mistake, the War on Cash is very real. And it’s unfolding before our very eyes.
Indeed, we've uncovered a secret document outlining how the Feds plan to take hold of savings during the next round of the crisis to stop individuals from getting their money out.
We detail this paper and outline three investment strategies you can implement right now to protect your capital from this sinister plan in our Special Report
Survive the Fed's War on Cash.
We are making 1,000 copies available for FREE the general public.
To pick up yours, swing by….
http://www.phoenixcapitalmarketing.com/cash.html
Best Regards
Phoenix Capital Research
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In the event of a bank holiday or bank failure, what happen to possesions in safe deposit?
When the real SHTF toilet paper will be HUGE!
That's all you need is a giant Raiders of the Lost Ark size warehouse of the stuff and you can be king, have harems of women, control peoples lives, live like an Oligarch of old.
:)
banning cash will kill a lot of homeless people
you could be forgiven for thinking that Ireland is a testing ground for the war on cash. Just yesterday our largest bank (Bank of Ireland ironically) announced that its essentially banning transactions in cash. It's an incremental implementation policy, first all cash lodgements below €3,000 must be lodged at an ATM machine and cash withdrawals of €700 or less at atm only. While today they did a bit of a climb down and extend the implementation date due to the huge public outcry the policy in general remains the same.. reduce and ultimately eliminate cash.
This is why I do what I do... I educate and highlight to people the absolute necessity of owning physical gold. (even physical cash is unsafe over the long term) Many people are beginning to understand and this is manifesting in increased gold sales. If you are reading this and you understand the absolute necessity of owning gold, and want to make a difference in your community or even protect your family and friends - get in touch with me.
www.teamramgold.com/about-us
But wait, act now on your free pamphlet and we will throw in a "Guide To Turning Your Money Over To Us Before The Government Takes It". Hurry, this is an unlimited offer!
Just received notice from Central Bancorp of Missouri about the charges that will be applied starting Dec 1 on withdrawals of money from my account.
?????????
do tell
I used to think it said Gain Spains Capital - silly me.
I went to withdraw some money from savings account to keep in my safe. Not a huge sum. The teller kept saying, "what are you buying?", "what are you using the money for?". They know the haircuts are coming and are fishing for how much the general population suspects the same. JMHO.
I went to withdraw some money from savings account to keep in my safe. Not a huge sum. The teller kept saying, "what are you buying?", "what are you using the money for?".
I told her that there was a two-for-one sale on paper towels at Dollar Central, and I wanted to stock up. She told me to try again tomorrow. Then I went home and found police cars outside my home. They wanted to know what I needed so many paper towels for.
Toilet paper for paper towels? hummm
i don't think that's the reason, you give the banks too much credit (pardon the pun) believing they are gathering intelligence.
they are probably just hassling you to discourage people from withdrawing cash, it adds cost and risk to have cash delivered to them, and no profit in it for them.
i pull out 40-50k per week total in cash out of 3 banks that i use, business accounts though, they dont give me any trouble or ask any questions as long as i keep it under 10k at a time, and they are used to me.
good call on taking some cash out to set aside for the coming "banking holidays", anyone who has cash then will be king.
so, what did you tell them when they asked, did you say, how is it any of your business what i do with my money?
I doubt the bank teller is that smart. She's just nosy and bored and her mama didn't teach her any manners.
Last time I withdrew a sizable stack of FSRs, the teller was visibly aroused as she counted out what probably amounted to 3 months pay for herself.
+1 I answer that I'm going to buy an oldtimer. depending from the amount it's a motorcycle or a car. shuts them up quite nicely
the "War on Cash" does exist, but as you write it's a diffuse number of reasons behind that. part of it is tax-evasion, part of it is bank profits, and so on
I suspect cash in the bank is not the issue (that cash remains in play) - its cash under the mattress that worries them. As in bank run or other draining of liquidity.
1000 copies, oh better hurry.
Its like FRNs. No matter how many are taken, more seem to appear from nowhere.
I hear FRNs are 50% Tribble.
RFID technology is very hackable in a bus queue.
Which is why it will be on your hand or forehead in the future
I'm joining the Free Pamphlet Army, are you?
Lets all barter stomp the banksters.