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It's Time To Kill the $100 Bill, Says Larry Summers
HughPickens.com writes: The NYT has an interesting editorial on why getting rid of big bills will make it harder for criminals to do business and make it easier for law enforcement to detect illicit activity. That's why officials in Europe and elsewhere are proposing to end the printing of high-denomination bills. According to a recent paper from Harvard's John F. Kennedy School of Government, a stack of 500-euro notes worth $1 million weighs just five pounds and can be carried in a small bag, whereas a pile of $20 bills worth $1 million would weigh 110 pounds and would be much more difficult to move around. Lawrence Summers, the former Treasury secretary and former adviser to President Obama, has argued that the United States should get rid of the $100 bill. "The fact that in certain circles the 500 euro note is known as the "Bin Laden" confirms the arguments against it," says Sanders. "Technology is obviating whatever need there may ever have been for high denomination notes in legal commerce."
Critics who oppose such changes say the big bills make it easier for people to keep their savings in cash, especially in countries with negative interest rates. Some people also prefer not to conduct transactions electronically because they fear security breaches. According to Sanders the idea of removing existing notes is a step too far but a moratorium on printing new high denomination notes would make the world a better place. "The United States stopped distributing $500, $1,000, $5,000 and $10,000 bills in 1969," concludes the NYT editorial. "There are now so many ways to pay for things, and eliminating big bills should create few problems."
Critics who oppose such changes say the big bills make it easier for people to keep their savings in cash, especially in countries with negative interest rates. Some people also prefer not to conduct transactions electronically because they fear security breaches. According to Sanders the idea of removing existing notes is a step too far but a moratorium on printing new high denomination notes would make the world a better place. "The United States stopped distributing $500, $1,000, $5,000 and $10,000 bills in 1969," concludes the NYT editorial. "There are now so many ways to pay for things, and eliminating big bills should create few problems."
As far as I'm concerned the true motive is to force larger transactions to use electronic transfers, allowing the government to track more transactions.
This is purely a push for more tracking. The government wants ALL your transactions to be electronic so that you cannot ever have a private monetary transaction.
Love sees no species.
*YES*
Exactly @#%ing that.
You are "charged" (taxed) for leaving your money with them. The idea is to force you to spend it (helping the economy) either through frivolous bullshit or investing in a business / house / something.
I am not joking, Japan just did this.
You literally lose money.
THEREFORE: everyone tries to take their money, in cash form out of the bank, hide it in the mattress, THAT's why they ban large denominations, because 100k under the bed in 100s is much easier than 100k under the bed in 50's
Greece or Cyprus did this recently, the article I read was not clear but it was so alarmingly written you would almost think that the $100 notes were not only no longer being printed for circulation but existing notes would be null and void after X date (I do not know if this is the case but if so, HOLY SHIT........... that's.... exceptionally evil)
Again, I restate, I don't have the data on that last paragraph so if anyone could clarify I'd appreciate the information.
But long story short, yes the bank STEALS your money for leaving it with them to 'promote growth"......... (anyone brought up with the discipline to save by good, honest parents / guardians has been getting fucked for the past 20 years, myself included)
The $100 is ideal for gifts to grandkids (I have 7). Impressively rare to them, crisp, clean. Two $50s just wouldn't be the same!
Get off my lawn, Summers!
It is about tighter control of the rest of population, not the criminals.
All those who keep contemplating that it is so easy to carry 500 Euro notes, are also of the opinion that the value embodied in the paper bill represents time and efforts, savings, work and sweat, of the people who worked to get 500 Euros. Yet assholes such as Larry Summers consider all that money to be owned "by society" which is only temporarily in the hands of the "criminally minded" individual.
Two hundred years ago farmers would have chased you out of the village with the pitchforks if you would try to pay with the pieces of paper. For several hundred years there was a statement on every paper note stating that every paper note is exchangeable to gold, no questions asked.
Then there was WW1. Latin Monetary Union, established by Napoleon, has evaporated. Most of the promises pffft... and evaporated, except perhaps for Switzerland. Then, eventually, governments realized that many people are conditioned to accept paper money and it does not need to be backed with gold, and fiat currencies became widely used.
When electronic money has been invented, it has been realized that the money no longer needs to be printed. However few problems have remained: paper money is still a relatively convenient way to make a payment as it is not heavy and semi-anonymous. Also, it has been realized when negative interest rates were introduced, simple $100 bill would effectively become and interest bearing interest. Introduction of negative interest rates would IMMEDIATELY cause massive cash hoarding by the people and the bank runs.
Those who try to ban cash should be upfront with their thinking. They should state what they think:
1. We, the government people, do not like cash because it allows anonymity.
2. Anonymity allows people not to pay taxes
3. Cash makes it harder to introduce negative interest rate.
The hard cold reality is that 95% real tax evasion, crimes and corruption, measured at the dollar value and volume is not conducted in cash, and is mostly conducted by by the top 1% by corrupt politicians and their private sector partners.
It is not about petty crime. It is about control of the common people
Because everyone will take all of their money out of the bank robbing the bank and the monetary wizards their negative interest rate. In turn the banks collapse due to the negative interest rate inspired bank run.
Yeah, it's about control, and using "official" channels to purchase goods and services. I buy and sell vehicles and go to auctions where credit cards aren't taken, or are heavily surcharged-- as almost all forms of electronic transfer except debit mechanisms take tiny nibbles of your purchases. Screw that. Those tiny nibbles are MY tiny nibbles.
Add to the problems, devices like credit card skimmers, smoking hot security breaches at major organizations, the inability to police the Dark Web, and I'll stick to cash where it makes sense. This is all about control, folks. Make no mistake about it.
---- Teach Peace. It's Cheaper Than War.
When the globalist elite scumbags of the world recently met at the World Economic Forum in Davos, one of the decisions was apparently to begin a "War on Cash". Mario Draghi soon proposed eradication of the 500 Euro note and Summers is proposing an end to the 100 FRN. Central banks around the world have either implemented(Japan) or are entertaining the idea of negative interest rates. As of now, this only applies to deposits at central banks, but how long before this insanity filters down to the retail banking sector? i.e. rather than getting tiny positive interest on your bank deposits, you must PAY the bank to hold your funds. In order to prevent mass withdrawals and people hiding their money in the mattress, the banking cartel needs to outlaw cash.
There is another more insidious reason for the War on Cash. When the bankers get into financial trouble, like in 2008 (and again in the very near future), they want deposits to be treated as just another liability that can be restructured in bankruptcy. It's called a bank "bail in" which forces depositors to take a "haircut" on deposits. It already happened in Portugal. Think it can't happen here? The Bank of England and FDIC published a paper in 2012 called "Resolving Globally Active, Systemically Important Financial Institutions". Under the proposed strategy, the losses of a bankrupt bank could be apportioned to "unsecured creditors"(depositors are the banks creditors). In exchange for your confiscated deposits, you would receive stock in a new holding company that has been "recapitalized" (with your money).
Canada has also put forth a deposit confiscation proposal in the "Jobs, Growth and Long Term Prosperity: Economic Action Plan 2013". The plan states (in part) that an insolvent financial institution(a TBTF one)
"...can be recapitalized and returned to viability through the very rapid conversion of certain bank liabilities into regulatory capital."
The "certain bank liabilities" meaning the customers' deposits of course.
The "War on Cash" has very little to do with stopping illicit activity. The government and their masters in the banking cartel want control of all your liquid assets. That way they can skim a little more of your hard-earned wealth(negative interest) and confiscate what you have in the event of some TBTF bank getting in trouble. Also nice for them because they could record even more of your financial transactions and lock you out of the economy if you step out of line.
That is what central banks have been doing forever, with inflation. Now they are just getting bolder laughing at the peasants.
It's cute how you assume that data about what exactly you bought, and when, is not stored anyway. Sure it might be technically illegal to do that: until TTIP passes, at least. But how exactly are you going to prove that they do not analyse the data regardless? Most large retail operations are multi-nationals anyway, who might have their data centres in a different jurisdiction to begin with.
Nah, if you pay with plastic, you get tracked. Anywhere, anytime. Period.
A .5% negative interest rate right now would cost me $1000 a year.
Meanwhile some sack of pig shit who purchased 11 homes in Australia speculating on "ever increasing house prices, indefinitely and rapidly"* would actually be sent a cheque each fucking month as a reward for going into debt
God.Damned.Madness
* They would ALSO be getting tax back from the government due to one of the most insane taxation / financial policies of all times, designed PURELY to reward those with 'spare money' and punishing those without
https://en.wikipedia.org/wiki/Negative_gearing
Those who saved money, responsibly are being EXCEEDINGLY punished in the West over the last couple of decades.
NOTE: I realise it's not your policy and some VERY small bank fees are ..... somewhat reasonable, but anything as a % of the persons money is a goddamn disgrace.
You're right tax avoidance can be easy with a cash transaction. If you want 100% electronic transactions at your businesses you need to eliminate the electronic transfer fees. You fucked that little store out of their profits if you used your debit or credit card for that carton of milk. Cash is better for all but the government and the banks. For instance a business doesn't get charged anything for all of the money the deposit or withdraw from the bank. Well they might get charged a small fee if they need a lot of coinage because the banks have realized there is a lot more work to transport $200 of coin vs several $1000s of paper. If a business is doing tax avoidance then let the government come down on them but don't penalize the other legitimate small businesses. Which btw the small businesses are the real backbone of the economy. Together they drastically out weigh all other parts of economy.
There are considerations other than your day-to-day convenience.
Ever buy or sell something used from the classified ads or CraigsList? How's that going to work without cash? Every single person must be set up with the capability to make electronic transactions or pay a fee to an intermediary?
Do some web searches about Negative Interest Rates. It's happening at central banks and if the government forces us to go cashless, it's going to happen at your bank. How would you like to be charged a 5% fee on your deposits simply for the privilege of having your money deposited in a bank. Isn't loss of purchasing power to inflation bad enough?
What happens when your bank gets in financial trouble, like in 2008? There are proposals floating around in Europe and North America suggesting that in the future, TBTF banks should be rescued by allowing them to "recapitalize" by seizing their customers' deposits. They take your cash and give you some stock in the new, restructured bank.
Be careful of what you wish for.
Translation: "I am going to ignore your points, dress them up with conjecture, and then go about believing what I did before, evidence be damned".
That's your opinion, but it really is just that.
I'm going on vacation soon, and I want to have cash money so that I can lock in the exchange rate, and know how much money I have. If I had to have $20s instead of $100s it would be pretty much impossible to carry without a fat wad of bills. As it is, I have my envelope full of cash which will be my spending money so I know how much I start with and how much I have left.
When I go out to a restaurant I prefer to pay in cash. Same for a bar.
Why would I want everything I ever do to be tracked, analyzed, reported on, correlated, sold, and provided to any entity who wants it? Even if I'm not doing anything illegal, that is nobody's fucking business. You think tracking is bad on the internet? Try having everything you do in the real world correlated to everything you do on the internet, and the entire picture of your life becomes part of Big Data. Fuck that.
You may have a desire to live in a surveillance society in which everything you do it monitored and tied directly to you, but I sure as hell don't.
It would mean everything you ever buy and the location and time you bought it is tracked and recorded. Which means law enforcement, insurance companies, divorce lawyers, ad companies, marketing companies, and every other asshole in the world who wants more information about what you do will likely have it ... it would be pretty much a total erosion of privacy and your right to do something without reporting it to the nanny state and whatever corporations have access to it.
Sorry, I think getting rid of paper notes is a stupid fucking idea, and would so fundamentally change some aspects of society as to be a terrible idea.
The right to do some things anonymously is not one you want to lose. So, you go ahead and plastic, the rest of us wish to remain the choice to not be constantly fucking spied on for everything we do.
Don't give me any of that "if you have nothing to hide you have nothing to fear" bullshit, either. It's my fucking privacy, I'll decide on its value.
Lost at C:>. Found at C.
Yeah, let's ban all cash, drive interest rates negative (except for top tier savings accounts with balances greater than $100k or so), force everyone to either invest in the stock market or continually buy stuff in order to try to maintain the value of their earnings. Real estate prices will skyrocket because that will be one of the places people will want to stash their earnings.
The top 1% will become the top 0.1%, the bottom 99.9% will be reduced to a half-assed barter economy, no personal savings, and mortgage and loan debt beyond belief.
Left MS Windows for Linux Mint and never looked back!
Vote for Bernie in 2016!
I don't think there is any conspiracy going on. It is just that the central banks cannot do anything other than manipulate interest rates to attempt to stimulate the economy. So if there is another crash with interest rates already at zero, what do they do? Perhaps they will sit by and let the whole thing collapse, hoping that the bottom is reached before people turn up in the streets with pitchforks. However, ask yourself this - who is most likely to want to turn the system on its head: a bunch of people with zero asset, and now no job, house, hopes, or ability to feed their families? Or a bunch of middle class savers who are pissed off that their savings are being raided by the central bank? The reality is that savers have skin in the game, so will complain bitterly but get on with it. Those who have nothing might just decide the game needs changing by any means necessary if nothing is done for them.
Personally I don't think there are any simple ways out of our present mess. A lot of stuff has been proposed: UBI, people's QE, central bank infrastructure funding. However all of them have potential problems either from a practical point of view, or politically. In the end it may be that just continuing to beat the economy with interest rates is all that central banks can do until we can see how things like UBI experiments and the AI jobs armageddon work out. I mean, the reality is that if you were paying 10% on cash trapped in your account, you would more than likely just go out each week and spend all your money, even if you don't really want anything you are buying. The stimulatory effects of this occurring in aggregate should not be underestimated. Of course the massive asset bubble and the destruction of the planet from rampant zombie consumerism will likely catch up with us eventually, but I guess Yellen and Carney figure they will be long retired by then.
Every government, since the dawn of civilization, has craved power.
Too much is never enough. The nature of government -- all government -- is to attempt to increase control at the expense of Liberty. It's what governments do. And it's why the framers of the US Constitution said that the ONLY legal tender would be gold and silver coin. They wrote that because they *knew* that money was one of the most important mechanisms of control -- and tyranny.
Government already pulled a fast one on the American people by gold standard. But even that massive sleight of hand is not enough for the ravenous, power hungry beast at government is: They want even more power.
They want to control every transaction, every penny, every measure of your wealth. This is indeed a war. But it isn't just a "war on cash" as many in the blogosphere call it. It's a war for complete and absolute control over your life. It's the very thing the framers of the Constitution feared most: Tyrrany.
The thing is, we are the boiling frog. We don't notice how hot the water has become. We think it's normal to have fiat currency. We think it's normal to have undeclared wars. We think it's normal to have unplayable debt.
We are so far down the road to serfdom that we won't notice the water getting a few degrees warmer, as the techno-pundits herald the wonderful new simplicity of our all-digital currency.
Yeah... I must be a wingbat, old-timer. I just don't get how awesome this new cashless future is.
All I can say is, resist this. If you don't your grandchildren will be slaves.
I know, I know... It sounds so fringe.
It's not unavoidable, with $100 bills you can take a decent vacation and pay cash as you go... with $20s, not so much.
What irks me is that the $100 bill is already worth roughly what a $10 bill used to be in the 1960s... why do we need to make paper currency ever more worth-less? It's not as if there wasn't criminal activity in the previous 100 years when cash was worth far more than it is today.
We could make life much harder on criminals by requiring everybody to get an RFID implant and placing readers all over, too... do we really need to go there to "stay safe"?