money

Ban $100 bills to tackle crime: Ex-bank chief

"He argued that high-denomination notes in high-value currencies were little used other than for crime, with people in most parts of the world favoring cash for small payments and electronic alternatives like credit cards or Paypal for bigger ones. As such, Sands called for the elimination of the 500 euro note, £50 bill and 1,000 Swiss franc bill and the $100 note. Depending on the country, tax evasion robs the public sector of anywhere between 6 percent and 70 percent of what authorities reckon they should collect, Sands added. He said that global financial crime flows amounted to $2 trillion per year, with corruption accounting for another $1 trillion." Continue reading →

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No Negative Rates Without Banning Cash, Says Former Fed Official

"I think it’s going to be hard to push the Fed Funds rate below negative 1. That’s going to be difficult. People can basically take out cash and put it in a vault and they get a zero return on it. This is supporting the ban on cash rhetoric. This is a huge social debate that we should start having. One way of doing it is to ban cash. Banning cash is a social and political debate, which is going to happen increasingly. As long as we have cash, we can’t have rates of much below negative 1 percent." Continue reading →

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Norway’s Biggest Bank Demands Cash Ban

rivacy advocates in Norway have expressed worries for years that, without cash, there would be no way for an individual to purchase something without being tracked. In 2014, Finans Norge, a financial industry organization in Norway, said the country was on pace to be a cashless society by 2020, Ice News reported. While DNB said its proposal will take time to complete, executives suggested the country start phasing out cash by discontinuing the 1,000 kroner note so it could focus on updating its banking system. Continue reading →

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Ron Paul Says to Watch the Petrodollar

"From 1972 to 1974, the U.S. government made a series of agreements with Saudi Arabia. These agreements created the petrodollar system. The U.S. government chose Saudi Arabia because of its vast petroleum reserves, its dominant position in OPEC, and the (correct) perception that the Saudi royal family was corruptible. In essence, the petrodollar system was an agreement that the U.S. would guarantee the survival of the House of Saud. It’s hard to overstate how much the petrodollar system benefits the U.S. dollar. It’s allowed the U.S. government and many Americans to live beyond their means for decades." Continue reading →

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JPMorgan: China’s Potential Capital Outflows ‘Practically Boundless’

"China has seen nearly $1 trillion in capital leave the nation since the second quarter of 2014, and according to analysts at JPMorgan Chase, the sky's the limit for outflows going forward. The causes of these massive capital outflows, which have prompted the People's Bank of China to tap the country's war chest of reserves to support the currency, have grown more numerous in the second half of 2015, argues a team led by managing director Nikolaos Panigirtzoglou. Amid the broadening of sources of downward pressure on the yuan, however, a major factor that may have restrained the central bank from devaluing the currency in a big way has vanished." Continue reading →

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China slaps cap on overseas UnionPay cash withdrawals

"The gatekeeper of China's foreign exchange has moved to plug a loophole in the capital account by capping the value of overseas withdrawals on bank cards, amid rising concerns over capital outflows and illicit money transfers. The State Administration of Foreign Exchange has slapped an annual cap on overseas cash withdrawals for UnionPay cardholders at 100,000 yuan or its equivalent per card. SAFE requires banks to add accounts that exceed the cap to a watch-list and forbid further cash withdrawals outside of China. Still, the withdrawal cap did not address another obvious escape route, the number of cards for which an individual can apply." Continue reading →

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IMF Approves Reserve-Currency Status for China’s Yuan

"The IMF will add the yuan to its basket of reserve currencies, an international stamp of approval of the strides China has made integrating into a global economic system dominated for decades by the U.S., Europe and Japan. It’s the first change in the SDR’s currency composition since 1999, when the euro replaced the deutsche mark and French franc. It’s also a milestone in a decades-long ascent toward international credibility for the yuan, which was created after World War II and for years could be used only domestically in the Communist-controlled nation. The IMF reviews the composition of the basket every five years and rejected the yuan during the last review, in 2010." Continue reading →

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Swiss bank breaks negative deposit rates taboo

"The Alternative Bank Schweiz (ABS) caused shockwaves with a letter sent to all clients informing them that it would begin imposing interest charges on deposits in 2016. For current accounts, the bank said it would impose a -0.125-percent rate, while slapping a -0.75-percent rate on client deposits higher than 100,000 Swiss francs. ABS, which grew out of the ideals the 1960's protest movement, justified the unprecedented development by saying it would provide manoeuvering room for financing 'meaningful projects'. The Swiss central bank introduced a negative deposit rate in January after it abruptly abandoned its three-year effort to hold down the franc's exchange rate to protect exports." Continue reading →

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The Secret Fed Paper That Advocated a “Carry Tax” on All Physical Cash

"Many commentators have noted that mainstream economists are calling to do away with cash entirely. It would be easy to scoff at these proposals as completely insane if the Fed hadn’t published a paper back in 1999 suggesting the implementation of a 'carry tax' or taxing actual physical cash using an expiration date if depositors aren’t willing to spend the money. The author of this lunacy is a visiting scholar with the ECB, the Fed, the IMF, and the Swiss National Bank. The fact that two of those groups have already imposed negative interest rates (ECB and SNB) should give warning that these sorts of ideas are actually taken very seriously by Central Banks." Continue reading →

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Bill Bonner: The First Shot in the War on Cash?

"Cash in hand is different. It is physical. Paper. You can do what you want with it. And you don’t pay a negative interest rate. Which is why the feds want to ban cash… They say it will make it easier for them to stimulate the economy. As long as you can hold physical cash, you have an easy way to escape negative interest rates: You just take the money out of the bank and put it in your home safe. But if physical cash is illegal, you have no choice. You have to keep 'your money' on deposit at the bank… and take whatever negative rate the bank imposes on you. Of course, the idea that taking away your money will stimulate economic growth is ridiculous." Continue reading →

Continue ReadingBill Bonner: The First Shot in the War on Cash?