Forget Greece … China Is the Real Threat
When the ATMs Went Dark …
There’s a time for calm, rational behavior … and a time to panic. On Tuesday, investors in U.S. stocks decided not to panic. Monday’s sell-off halted. But it did not reverse.
And it left the street with its worst half-year performance since 2010. Gain for 2015 so far? Zilch. But have we seen the top? We will have to wait to find out.
Fox News reports that Greeks are eyeing Bitcoin to protect their savings. At midnight Tuesday night, the Greek government defaulted on a €1.5-billion loan repayment to the IMF. And it has imposed a 60-euro-a-day limit on cash withdrawals.
As of today, depositors reportedly only get 50 euro per day, because the banks have run out of 10s and 20s.
This leaves many Greeks short and looking for alternatives. Pity those who were last in line at the ATMs before they went dark. Says a restaurant owner in Athens, quoted by the Associated Press:
“You don’t know what can happen. In my case, I have money, and I don’t have money in a sense. I have it in the bank, but I can’t get it in my hands. It’s crazy.”
As we’ve been pointing out, money in the bank is not the same as money in hand. The first is just a loan to what could be a bankrupt institution. It could be worth nothing. The second is cash – ready, handy, and extremely useful.
In a financial emergency, there won’t be a liquor store in town that won’t welcome you as a customer. A Greek butcher… also to Associated Press:
“I have no cash to pay for meat supplies for next week because of the capital controls. Sooner or later, probably in this month, I’ll have to let 10 people go.
The people are buying with cash, not credit cards, and the problem is the customers don’t have cash.”
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