Bank of England's Chief Economist: Abolish the Use of Cash

[Nat Algren]

SATURDAY, SEPTEMBER 19, 2015

Andy Haldane
The bankster tools continue to promote the end of cash.

In a speech to the Northern Ireland chamber of commerce, Andy Haldane, chief economist at BOE, said ending cash would help the bank to manage inflation by enabling it to bypass the current constraint against lowering rates below zero, reports FT.

Abolishing cash would remove the option for individuals to remove money from banks, if it ever instituted negative interest rates, he said.

He continued “perhaps central bank money is ripe for its own great technological leap forward, prompted by the pressing demands of the zero lower bound [on interest rates]”.

Halande is also thinking global. FT writes:

Highlighting the need for a government-backed electronic wallet, even if it no longer had the Queen’s head printed on notes or coins, he proposed a world without cash. “This would preserve the social convention of a state-issued unit of account and medium of exchange, albeit with currency now held in digital rather than physical wallets,” he said.In addition to Halande, FT has recently called for the abolishment of cash, as has Citi Group's top economist, Willem Buiter. And Bill Gates has dissed cash.
http://www.economicpolicyjournal.com/2015/09/bank-of-englands-chief-economist-end.html

 

[naturalmwa]

 

[Hawk and Awe]

I love the idea of getting rid of cash, because I hate having to carry it. But man that is evil

 

[Hawk in SEC Country]

New World Order staring us right in the face.

 

[lucas80]

Won't happen. The actual feel of money is reassuring. Forget that the whole plan would be unworkable. Announcing an end to currency would lead to a run on currency

 

[ottumwan in tx]

I'm all for getting rid of fake paper notes in lieu of coins made from gold and silver

 

[joelbc1]

New World Order staring us right in the face.

"No cash" would certainly make a lot of accounting a lot easier and simpler........It would be a huge step towards "the tax return on the back of a post card" reality.

 

[Hawk and Awe]

"No cash" would certainly make a lot of accounting a lot easier and simpler........It would be a huge step towards "the tax return on the back of a post card" reality.

How would removing cash have any impact on a tax return?

 

[torbee]

How would you buy street drugs?

 

[dbq hawk 32]

Abolishing cash would remove the option for individuals to remove money from banks, if it ever instituted negative interest rates, he said.

This is going to need an explanation.

 

[Nat Algren]

This is going to need an explanation.

These things don't always happen in a day. You cannot cook a frog by throwing it into a boiling pot of hot water. You have to place it in a cool pot and slowly turn up the heat.

By Robert Wenzel

Citi Group's top economist, Willem Buiter, sees a big problem with cash.

He is of the opinion that because interest rates are so low, the Federal Reserve is not able to pump sufficient quantities of money into the economy.

He holds this view despite the fact that the money supply has grown by near 50% , since the interest rate controlled by the Fed, the Fed Funds rate, has been near zero.

MONDAY, APRIL 13, 2015



Buiter somehow views this money growth as not sufficnt, despite the fact that sound economics teaches that it is increased production of goods and services, not increased money printing that grows an economy.

Part of this "problem" of Keynesian imagined slow money growth, in Buiter's views, is because of cash. For Buiter, when interest rates are extremely low he sees the potential for people to hold their funds as cash instead of putting it in the banking system, where banks can use it as reserves to increase the money supply even more.

So, according to Bloomberg, Buiter suggests three methods to address this "problem."

1. Abolish currency.
2. Tax currency.
3. Remove the fixed exchange between currency and central bank reserves/deposits.

The first two methods obviously drive cash out of people's hands and into the banking system. As Bloomberg notes, these are certainly controversial recommendations, but that hasn't stopped Buiter:
Buiter is aware that his idea may be somewhat controversial, so he goes to the effort of listing the disadvantages of abolishing cash.

1. Abolishing currency will constitute a noticeable change in many people’s lives and change often tends to be resisted.
2. Currency use remains high among the poor and some older people. (Buiter suggests that keeping low-denomination cash in circulation — nothing larger than $5 — might solve this.)
3. Central banks and governments would lose seigniorage revenue.
4. Abolishing currency would inevitably be associated with a loss of privacy and create risks of excessive intrusion by the government.
5. Switching exclusively to electronic payments may create new security and operational risks.

Buiter dismisses each of these concerns in turn, finishing with:In summary, we therefore conclude that the arguments against abolishing currency seem rather weak.There you have it. One of the top global bankster economists is calling for the abolishment of cash. This despite the fact that the Federal Reserve is quite capable of flooding the system with money, even if there is cash in the world. The only thing elimination of cash would do is result in every monetary transaction being tracked. That is a goal that certainly is considered an extremely dangerous goal by any person that considers government involvement in personal affairs excessive already. The last thing needed is the abolishment of cash, to be replaced with electronic cards that record every penny spent and earned.

Robert Wenzel is Editor & Publisher at EconomicPolicyJournal.com and at Target Liberty. He is also author of The Fed Flunks: My Speech at the New York Federal Reserve Bank. Follow him on twitter:@wenzeleconomics

http://www.economicpolicyjournal.com/2015/04/top-bankster-economist-issues-report.html

 

[dbq hawk 32]

These things don't always happen in a day. You cannot cook a frog by throwing it into a boiling pot of hot water. You have to place it in a cool pot and slowly turn up the heat.

By Robert Wenzel

Citi Group's top economist, Willem Buiter, sees a big problem with cash.

He is of the opinion that because interest rates are so low, the Federal Reserve is not able to pump sufficient quantities of money into the economy.

He holds this view despite the fact that the money supply has grown by near 50% , since the interest rate controlled by the Fed, the Fed Funds rate, has been near zero.

MONDAY, APRIL 13, 2015



Buiter somehow views this money growth as not sufficnt, despite the fact that sound economics teaches that it is increased production of goods and services, not increased money printing that grows an economy.

Part of this "problem" of Keynesian imagined slow money growth, in Buiter's views, is because of cash. For Buiter, when interest rates are extremely low he sees the potential for people to hold their funds as cash instead of putting it in the banking system, where banks can use it as reserves to increase the money supply even more.

So, according to Bloomberg, Buiter suggests three methods to address this "problem."

1. Abolish currency.
2. Tax currency.
3. Remove the fixed exchange between currency and central bank reserves/deposits.

The first two methods obviously drive cash out of people's hands and into the banking system. As Bloomberg notes, these are certainly controversial recommendations, but that hasn't stopped Buiter:
Buiter is aware that his idea may be somewhat controversial, so he goes to the effort of listing the disadvantages of abolishing cash.

1. Abolishing currency will constitute a noticeable change in many people’s lives and change often tends to be resisted.
2. Currency use remains high among the poor and some older people. (Buiter suggests that keeping low-denomination cash in circulation — nothing larger than $5 — might solve this.)
3. Central banks and governments would lose seigniorage revenue.
4. Abolishing currency would inevitably be associated with a loss of privacy and create risks of excessive intrusion by the government.
5. Switching exclusively to electronic payments may create new security and operational risks.

Buiter dismisses each of these concerns in turn, finishing with:In summary, we therefore conclude that the arguments against abolishing currency seem rather weak.There you have it. One of the top global bankster economists is calling for the abolishment of cash. This despite the fact that the Federal Reserve is quite capable of flooding the system with money, even if there is cash in the world. The only thing elimination of cash would do is result in every monetary transaction being tracked. That is a goal that certainly is considered an extremely dangerous goal by any person that considers government involvement in personal affairs excessive already. The last thing needed is the abolishment of cash, to be replaced with electronic cards that record every penny spent and earned.

Robert Wenzel is Editor & Publisher at EconomicPolicyJournal.com and at Target Liberty. He is also author of The Fed Flunks: My Speech at the New York Federal Reserve Bank. Follow him on twitter:@wenzeleconomics

http://www.economicpolicyjournal.com/2015/04/top-bankster-economist-issues-report.html

My thought was that people will simply move the vast majority of their money into other relatively liquid assets like stocks (aside from what they need from day to day purchases).

This is a terrible idea though.

 

[Nat Algren]

My thought was that people will simply move the vast majority of their money into other relatively liquid assets like stocks (aside from what they need from day to day purchases).

This is a terrible idea though.

The scary thing is that people in high places are contemplating it. The question is ...what will be the event/crisis that catapults it into being.

 

[joelbc1]

How would removing cash have any impact on a tax return?

Punch a button and everyone would know in short time how much money you made (legitimately) and your taxes owed would be honestly arrived at in short time. Folks who currently for with cash wouldn't be able to hide it. Waiters,waitresses, mechanics, small business owners and the like would hate it.

 

[dbq hawk 32]

Punch a button and everyone would know in short time how much money you made (legitimately) and your taxes owed would be honestly arrived at in short time. Folks who currently for with cash wouldn't be able to hide it. Waiters,waitresses, mechanics, small business owners and the like would hate it.

/everyone/ would hate it. It would kill profit margins of small businesses.

 

[joelbc1]

/everyone/ would hate it. It would kill profit margins of small businesses.

"Profit margins" should not be based on unreported/stolen money. Should they?

 

[dbq hawk 32]

"Profit margins" should not be based on unreported/stolen money. Should they?

Do you know how credit cards work?

 

[joelbc1]

Do you know how credit cards work?

Cash leaves no record. Credit/debit cards always leave a paper trail. No more cash, no more hidden transactions.

 

[dbq hawk 32]

Cash leaves no record. Credit/debit cards always leave a paper trail. No more cash, no more hidden transactions.

That's not my point...

 

[Hawk in SEC Country]

"No cash" would certainly make a lot of accounting a lot easier and simpler........It would be a huge step towards "the tax return on the back of a post card" reality.

Did you even read "why" this guy wants to go with "no cash"?

So you cannot withdraw money from your bank account if the bank ever starts to fail..............so you fail with it. You are no longer able to save yourself from being wiped out.

You really want that? Because it's convenient?

 

[Hawk in SEC Country]

Cash leaves no record. Credit/debit cards always leave a paper trail. No more cash, no more hidden transactions.

So I can no longer pay someone out of my pocket for providing a service for me. And I can no longer receive the same.

You are seriously advocating this...........that's sad and scary at the same time.

 

[Hawk in SEC Country]

Won't happen. The actual feel of money is reassuring. Forget that the whole plan would be unworkable. Announcing an end to currency would lead to a run on currency

You're leaving out that the people who want this.......don't give a shit about how money "feels" to any of us.

 

[L. Wade Childress]

the concept of banks charging for deposits has never seemed crazy to me. where else is everyone going to put large amounts of money? now, if you can make enough money and a traditional rate spread then basic economics would prevent it from happening as people will switch to banks that don't charge them. but if all institutions decided to move that direction then there wouldn't be much the consumer could do.

 

[joelbc1]

So I can no longer pay someone out of my pocket for providing a service for me. And I can no longer receive the same.

You are seriously advocating this...........that's sad and scary at the same time.

Show me where I advocated this idea. I do know there are some serious reasons for folks advocating a "cashless" society and this is one of the reasons frequently given.(the taxability angle).
Remember hawk, you can always barter services.
But please show me where I advocated this "cashless" idea.

 

[Hawk and Awe]

Punch a button and everyone would know in short time how much money you made (legitimately) and your taxes owed would be honestly arrived at in short time. Folks who currently for with cash wouldn't be able to hide it. Waiters,waitresses, mechanics, small business owners and the like would hate it.

But how does that do anything to shorten or simplify the return? Its just one number. A below average accounting system can do that today. What makes a return long and complicated is the credits and deductions which would continue to be challenging in a cashless world.

Not trying to be difficult - I get where you're coming from and the impact on unreported income would be huge. But To me its just like saying removing the progressive system will simplify the process when that's actually the easiest part of a return.

 

[naturalmwa]

How would you buy street drugs?

Blow jobs

 

[torbee]

Blow jobs

That would be a steep learning curve for me.

 

[naturalmwa]

That would be a steep learning curve for me.

I'm sure the entrepreneurial markets would find a solution for this situation. I'm entertaining myself imagining several options.

 

[CeMar_Clone]

SATURDAY, SEPTEMBER 19, 2015

Andy Haldane
The bankster tools continue to promote the end of cash.

In a speech to the Northern Ireland chamber of commerce, Andy Haldane, chief economist at BOE, said ending cash would help the bank to manage inflation by enabling it to bypass the current constraint against lowering rates below zero, reports FT.

Abolishing cash would remove the option for individuals to remove money from banks, if it ever instituted negative interest rates, he said.

He continued “perhaps central bank money is ripe for its own great technological leap forward, prompted by the pressing demands of the zero lower bound [on interest rates]”.

Halande is also thinking global. FT writes:

Highlighting the need for a government-backed electronic wallet, even if it no longer had the Queen’s head printed on notes or coins, he proposed a world without cash. “This would preserve the social convention of a state-issued unit of account and medium of exchange, albeit with currency now held in digital rather than physical wallets,” he said.In addition to Halande, FT has recently called for the abolishment of cash, as has Citi Group's top economist, Willem Buiter. And Bill Gates has dissed cash.
http://www.economicpolicyjournal.com/2015/09/bank-of-englands-chief-economist-end.html

And people wonder why other hate the FED and the New World Order. No wonder the world is so f#cked.

 

[Pepperman]

Won't happen. The actual feel of money is reassuring. Forget that the whole plan would be unworkable. Announcing an end to currency would lead to a run on currency

Yes it would, but not the "currency" you have in mind.

 

[Hawk in SEC Country]

Show me where I advocated this idea. I do know there are some serious reasons for folks advocating a "cashless" society and this is one of the reasons frequently given.(the taxability angle).
Remember hawk, you can always barter services.
But please show me where I advocated this "cashless" idea.

So let me get this straight........ You are "OK" with banks doing away with "cash"....removing the ability for people who hold cash assets in their banks, to pull that money out if the bank starts to fail....so they don't lose their personal savings in the process. Because that is exactly why this British minister wants a cashless society...so that you lose that ability.....so that the bank can take you down with them if they tank and start losing money.

you're advocating it by posting that you think it's good. You agree that it should happen.

And what if my idea of bartering is giving someone $100 for watching my house for the a period of time while I"m out of town? That's my business. Not the bank's....and certainly not the gov't's

 

[joelbc1]

So let me get this straight........ You are "OK" with banks doing away with "cash"....removing the ability for people who hold cash assets in their banks, to pull that money out if the bank starts to fail....so they don't lose their personal savings in the process. Because that is exactly why this British minister wants a cashless society...so that you lose that ability.....so that the bank can take you down with them if they tank and start losing money.

you're advocating it by posting that you think it's good. You agree that it should happen.

And what if my idea of bartering is giving someone $100 for watching my house for the a period of time while I"m out of town? That's my business. Not the bank's....and certainly not the gov't's

SEC.....I did NONE of the above. I did mention that this is certainly NOT a new idea. I remember talking with a local banker when I first moved to DSM (40 years ago). he told me that their would be no real need for money in 30 years. At that time he was hawking "MasterCard".....He was telling my about the future use of money /debit cards and how that would eliminate the need for "cash" transactions.
I really haven't thought much about it since.....but this banker was correct. I am using my debit card over here in Europe with no issues. It's all pretty seamless.
I don't quite understands how cash. your argument for cash as a way of preventing bad banking decisions....God knows we have had enough of those when the country is awash with cash.
I guess I don't see things as sinister. You SEC. But to relieve you, I am not advocating a no cash society but I can certainly see why/how it might be viable.

 

[dandh]

I hope this never comes to pass, because it would mean the government could literally know about, and thereby control, almost every decision every person in the country makes. Horrible, horrible idea, IMO. Maybe the big government types like it, but I hate it.

 

[ottumwan in tx]

I hope this never comes to pass, because it would mean the government could literally know about, and thereby control, almost every decision every person in the country makes. Horrible, horrible idea, IMO. Maybe the big government types like it, but I hate it.

it's close to being this way now in America. the feds have control of healthcare dollars now, or at least the they think they do, they have taken all of welfare and social security and put it on atm cards and on direct deposit, all they gotta do is now take control of the cash businesses like lawn mowing and stripping. they have come pretty close to making retail outlets see the inconvenience of cash. they have made banks not carry much cash on hand. the ironic thing is that check writing is wayyyy down, I bet they wish more people would write checks, to have said paper trail, and use less cash, but the atm card took over for the checks.