![\"They\u2019re](\"http:\/\/www.nestmann.com\/images\/assets\/articles\/yourcash.jpg\")
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It might sound like a conspiracy theory spun by right-wing crazies. But judging by the increasing desperation of governments to reboot the world economy, it just might happen.<\/p>\n
\u201cIt\u201d is the recall or confiscation of cash, i.e., dollars, euros, pounds, etc., in physical form. And a key justification that those calling for this radical measure cite is that it reinforces the ability of central banks to impose negative interest rates.<\/p>\n
Negative rates mean that lenders literally pay businesses and consumers to borrow money. They also penalize savers for hoarding it. The Danish and Swiss national banks have gone the farthest into negative territory, with interest rates of -0.75%. That means \u20ac100,000 in a euro-denominated account in Switzerland would be worth only \u20ac99,250 after one year. While these rates apply only to \u201cexcess reserves\u201d banks maintain at the central bank, nothing stops banks from requiring depositors to share the pain.<\/p>\n
But that\u2019s not enough, according to some economists. Citicorp\u2019s chief economist, a technocrat named Willem Buiter, thinks the US needs much lower interest rates to push the economy out of the doldrums. He thinks negative interest rates around -6% would do the job. But there\u2019s one condition: For his plan to work, he says, the government must abolish cash.<\/p>\n
It\u2019s easy to understand why Buiter might not have warm and fuzzy thoughts about cash. After all, if your bank is\u00a0taking<\/em>\u00a06% from your savings, $100 in your account would be worth only $94 at the end of one year, $88.36 after two years, and $83.06 after three years. On the other hand, a $100 bill with Ben Franklin\u2019s picture on it would still be worth\u2026 well, $100. Buiter understands that as long as cash exists, no one will voluntarily keep their savings in accounts with negative interest rates.<\/p>\n …click on the above link to read the rest of the article…<\/p>\n","protected":false},"excerpt":{"rendered":" They\u2019re coming for your cash It might sound like a conspiracy theory spun by right-wing crazies. But judging by the increasing desperation of governments to reboot the world economy, it just might happen. \u201cIt\u201d is the recall or confiscation of cash, i.e., dollars, euros, pounds, etc., in physical form. And a key justification that those […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,6],"tags":[10623,1035,1034,124,175,195,534,536,558,1389],"class_list":["post-14448","post","type-post","status-publish","format-standard","hentry","category-economics","category-liberty","tag-ban-on-cash","tag-cash","tag-cashless-society","tag-central-banks","tag-credit","tag-debt","tag-monetary-policy","tag-money","tag-negative-interest-rates","tag-nirp"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14448","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14448"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14448\/revisions"}],"predecessor-version":[{"id":14449,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14448\/revisions\/14449"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14448"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14448"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14448"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}