Economy
Related: About this forumWealth Confiscation for the Digital Age: the New “Cash Tax”
Wealth Confiscation for the Digital Age: the New Cash Tax
by Brian Hunt May 10, 2016
[font color="blue"]Directly from your bank account.[/font]
From Brian Hunt, director, Casey Research:
Negative interest rates have become a phenomenon with economists and the media. But Im writing to tell you something about negative interest rates you havent heard. You certainly wont hear about it in the mainstream press.
Whats coming at you is a historic event. Its something our grandchildren will hear stories about, much like the Great Depression or the Cold War. It could send the price of gold much higher in the coming years.
If you know whats coming, it could mean the difference between having lots of free cash in retirement and barely getting by. And please remember this warning: Social Security will help even less than you think.
To understand the gravity of this moment, lets cover one of the most bizarre ideas in the world
Negative Interest Rates.
In a normal world, your bank pays you interest on your savings. It takes your money, pools it with other peoples money, and loans it out. The bank makes money by paying out less in interest on your deposit than it earns in interest from borrowers. For example, it might pay out 3% to depositors while earning 6% from borrowers. This is how it has worked for decades. ............(more)
http://wolfstreet.com/2016/05/10/wealth-confiscation-for-the-digital-age-the-new-cash-tax/
cheapdate
(3,811 posts)DetlefK
(16,423 posts)"Oh Noes, the banks charge us negative interest rates! If only I could withdraw my money from this bank-account and move to a new bank and a new bank-account without negative interest-rates... Except banks hate attracting customers that give them money. Woe is me."
And nobody is phasing out cash as part of a big plan. It's getting phased out because electronic cash is more convenient for the users and costs less in maintenance for the printers.
snot
(10,481 posts)This source is not my favorite, but his basic points are accurate. Negative rates have already been imposed in Japan, and US Fed Reserve Chair Janet Yellen has stated that negative rates could soon be "on the table."
And there is a serious push here and elsewhere to eliminate larger-denomination bills. The excuse given is that they're mostly used by criminals because they're harder to trace; but the move is also needed if you're thinking of imposing negative rates.
The Fed has nowhere else to go, other than to actually deliver stimulus where it would actually do some good to the individuals who need it most and will spend rather than hoard it and that they cannot do without action from Congress, which is not forthcoming.