The Mainstream Media Goes "All In" On Promoting a Cash Ban

Phoenix Capital Research's picture

In the last 12 months, the editorial boards at three of the biggest mainstream media outlets (Bloomberg, The Financial Times, and The New York Times) have all penned articles supporting the banning of physical cash.

In every circumstance, the argument has been that doing this would

A)   Help stop crime such as money laundering or drug dealing.

B)   Generate major economic growth.

Regarding #1, we know this claim is complete bunk. Consider the case in India where the Government recently banned ALL currency denominations above 500 Rupees.

The argument from the Government was that doing this would quickly reveal that most of the money would stay in circulation as part of the “Black Market”… thereby justifying the move (those using cash were criminals).

Instead, physical cash has poured into India banks. As we write this, 82% of ALL physical cash in the denominations that were banned has been deposited… and that was in less than THREE weeks.

I want to emphasize here that 500 rupees comes to roughly $7. And these denominations represent roughly 86% of ALL of India’s cash.

Put another way, India effectively banned ALL physical cash claiming that the money would remain in the economy because it was being used illegally. And instead, the money poured into banks.

So… we know that cash bans aren’t really about cracking down on crime. India has proved this to be total bunk.

But what about #2: the claim that banning cash would generate major economic growth?

This is the argument being proposed in the West, particularly amongst financial elites such as Ken Rogoff

The problem with this claim however is that a cash ban simply represent yet another attempt to go below the “zero bound” or ZIRP. The view here is that as long as Central Banks can force interest rates low enough, the economy will come roaring back.

The only problem is that there is ZERO evidence of this. The US maintained ZIRP for seven years, spent over $3.5 TRILLION in QE and generated the weakest recovery in the last 80 years.

In Europe, FOUR NIRP cuts (going well below the zero bound) and $1 TRILLION in QE failed to generate significant growth.

And in Japan 16 YEARS of ZIRP combined with QE programs equal to 50% of GDP failed to generate a sustained recovery.

So the idea that somehow getting rid of cash will prove to be the lucky charm at which point growth will come roaring back is misguided at best.

But will this stop the elite from banning cash in the US?

No way.

Indeed, we've uncovered a secret document outlining how the Fed plans to incinerate savings in the coming months.

We detail this paper and outline three investment strategies you can implement

right now to protect your capital from the Fed's 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

Graham Summers

Chief Market Strategist

Phoenix Capital Research

 

 

 

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fellatio is not fattening's picture

This is absolutely true, 

A)   Help stop crime such as money laundering or drug dealing.

same as I believe it would stop crimes such as purse snatchings and robberies if cash weren't useable.  Please tell me why I'm wrong??

Joebloinvestor's picture

It isn't going to be a big fucking surprise when the government seizes some of those bank deposits.

smoke em if you got em's picture

keep in mind the moment you put 'your' money in the bank it is no longer your money ... you are a creditor, a low ranked one at that. In essence we are being told that we must all be come lenders to the bank .... no choice .... who's money is it?... and what right does anyone have to demand it be put in banks .... everyone should get the word out that the money in the bank you think is yours IS NOT!

TeaClipper's picture

In the UK, both NatWest, and RBS banks have adverts running, showing children playing with money, with the message, teach your children about money now because in the future there may not be any coins. The brainwashing process has started and they are quite happy to wait a generation to get what they want

VWAndy's picture

 Must keep those plates spinning or else.

sosoome's picture

The masses will go for it enthusiastically...just scan the phone and everything done; no fuss no bother.

Central control of education a wonderful thing. 

Conax's picture

The media went 'all in' for hillary, too.

Fuck em

The Most Interesting Frog in the World's picture

I think we're missing the biggest points.

1) What citizens do with their money is their own damn business.  Not the business of government or their shill economists.  

2) It doesn't matter if confiscating the citizen's money creates growth, or it doesn't.  Should we confiscate land that is not being used the way government officials deem appropriate?  I think not.

In any event, India is way behind the US.  This is the same thing that POS FDR did with gold in 1933.

One-Eyed-Thong's picture

I read this book once

it said  "and no one could buy or sell unless they have the mark"

 

it was a popular book back in the olden days 

but i can't remember the title of the book

or the author

 

i think it was animal farm

Billy the Poet's picture

There was an animal farm in the first chapter run by a guy named Adam.

Citxmech's picture

Didn't some guy named Noah have the animal farm?

I am more equal than others's picture

 

 

And Hillary was a pig on a pale horse. 

Akzed's picture

I love ZH - even ads have comments!

 

"We're all gonna die! Buy my shit!"

Clock Crasher's picture

goldmoney debit cards

bring on your cash ban its already here in the west

as long as you have a bank account and a goldmoney account and on a personal gold standard you have no problem interacting with merchants who accept digital USD and merchants who accept precious metals

take your cash ban and go fuck yourself

 

FIAT CON's picture

People need to wake the f**k up and realize that having a monetary sytem that's based on the fact " if you don't hold it you don't own it" whether it's cash or PM's.

adanata's picture

 

People need to wake up regarding the monetary system? LOL. In my experience the population at large cannot grasp these concepts even when you explain it to them very slowly and simply. They're not taught when they are young and are thoroughly conditioned to believe it's too complicated to cope with. They await their instructions from the TV.

Citxmech's picture

"Five thousand quatloos that the newcomers will have to be destroyed. . . "

lakecity55's picture

The same as everywhere else: Full Totalitarianism!

Countrybunkererd's picture

Cash ban coupled with biometric ID's and all.  A cash ban would do nothing without that because cash is for CONVENIENCE of trade, not trade itself.

It is that mark of the beast thing from Animal Farm or something listed below by O-E-T.

lostintheflood's picture

i'm not sure this article makes any sense...

Citxmech's picture

It reads like an introductory paragraph. . . 

Where's the rest of the story?

Billy the Poet's picture

Paul Harvey, where are you?

East Indian's picture

Modi wins Time Person of the Year - for abolishing cash. 

Trump has achieved the impossible - he won the President post solely on his own. And Modi is the Person of the Year?

You know where this is going. 

sister tika's picture

Do you live in India, East Indian? If so, could you tell me what you see there firsthand? What's going on?

dark fiber's picture

You know Time is a shitrag right?

One-Eyed-Thong's picture

what if they just legalize all drugs and tax them?

ThanksChump's picture

How about we declare open season on bank employees?

 

We know where they hang out and when, so it's easier than deer. Anyone know a good taxidermist? A few animatronics and Billy Banker will be flapping and singing on my wall.