The Zombies 2015 - 2017 Part 4

5.  The Financial 3-Way Trap Facing The West - PART 2 
TRAP 1:  Negative Interest Rates - Uncharted Territory 1  

 
1.   What does that mean..?  It means YOU pay the bank to hold your money for you.  The bank does NOT pay you interest on your deposits.

2.   At the moment, Negative Interest is being charged to commerical banks who have cash on deposit via reserves at the Central Banks. As at 7 February 2016 the following central banks are charging Negative Interest to the commercial banks:

• European Central Bank;
• Swiss National Bank;
• Riksbank of Sweden;
• Nationalbank of Denmark;
• Bank of Japan;

That this may spread to retail customers holding cash at their banks, has not been ruled out.

3.   Western economies are stagnating. Officially they wish to stimulate the economy to get banks and people to spend and avoid Deflation.  Negative Interest Rates are effectively a tax to stop the hoarding of cash and force people to spend it NOW.  At the moment, people in the West are attempting to save more, reduce their expenses and get out of debt.

4.   The stupidity of Negative Interest becomes obvious:  If the bank is taxing people who keep their deposits at the bank, in order to force them to spend their cash NOW, that means whatever you might have spent IN THE FUTURE, IS BEING SPENT NOW - THEREBY DESTROYING YOUR FUTURE CAPITAL.

That means your cash will run out sooner and your spending will decline sooner - totally destroying the purpose of Negative Interest Rates.

Further, if the bank is taxing you on your deposits, it means you will have to save more to offset those charges.  You won't be spending more.  You'll be spending less - totally destroying the purpose of Negative Interest Rates.

5.   Human nature is such that if their bank savings are taxed at Negative Interest rates, they will remove their cash from the bank and either put it into tangible assets or hoard their cash outside the banking system e.g. under their mattress.  That would further slow Western economies and would be regarded as a sign of protest against banking policies.  Negative Interest Rates mean your bank balance shrinks every day.

6.   So....the bankers prepared a second trap to work simultaneously......


TRAP 2: Outlawing Cash: Negative Interest Rates In A Cashless Society - Uncharted Territory 2

1.   It started innocently enough in the West - but actually by stealth....

• Why carry coins when you can store digital coins in an electronic wallet..?
• Why not use your mobile phone for everyday cash transactions..? (Scandanavia and spreading)
• Why not use a stored value card that's been prepaid..?
• Why not make public transport accept digital currency..?
• Why not do little experiments with shops to see if consumers accept digital currency..? (United Kingdom)
• Why not put actual limits on physical cash that can be used for shop transactions..? (France, Greece)
• Why not get people more used to debit cards..?
• Why not use terrorism and money laundering as excuses to limit or ban cash..?

 Get the picture....??

2.   And now...not just in the West, but around the world, here is a list of countries taking steps to restrict cash payments:

• Argentina
• Australia
• Belgium
• Canada
• China
• Denmark
• Ecuador
• France
• Germany
• Hong Kong
• India
• Ireland
• Israel
• Italy
• Kenya
• Mexico
• Netherlands
• Norway
• Philippines
• Saudi Arabia
• Spain
• Sweden
• Uruguay
• United Kingdom

"The War on Cash: A Country by Country Guide", The Corbett Report, 27 January 2016

3.   Putting it simply when you have cold hard cash in your hands, it is outside the banking system and within your complete control. But when currency is electronic / digital, it is completely outside your control and in the control of bankers and politicians.  It allows endless funding for the banks.

4.   The ramifications of this are sobering.  A faceless bureaucrat or tame politician can freeze your digital currency, wipe you out in a keystroke, decide how much you can digitally spend per week, effectively putting you on welfare, scrutinize every transaction, debit money from your account.......and what can you do about it......??

5.  Nothing. 


TRAP 3: Bank Bail-In Legislation In Every Western Country - Uncharted Territory 3

1.   Australia, New Zealand, Europe, United Kingdom, United States and Canada now have almost identical Bank Bail-In laws that were swiftly enacted over the last 2 years.

2.   In simple terms, if your bank goes belly-up, your deposits are confiscated to bail out the banks.  And that's on top of the Negative Interest Rates.  It's now clear why there is a move to ban cash.  As mentioned above, digital currency allows bankers and politicians absolute control.

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