{"id":18276,"date":"2016-02-25T19:57:18","date_gmt":"2016-02-26T00:57:18","guid":{"rendered":"http:\/\/olduvai.ca\/?p=18276"},"modified":"2016-02-25T19:57:18","modified_gmt":"2016-02-26T00:57:18","slug":"demand-for-big-bills-soars-as-nirp-fearing-japanese-stuff-safes-with-10000-yen-notes","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=18276","title":{"rendered":"Demand For Big Bills Soars As NIRP-Fearing Japanese Stuff Safes With 10,000-Yen Notes"},"content":{"rendered":"

Demand For Big Bills Soars As NIRP-Fearing Japanese Stuff Safes With 10,000-Yen Notes<\/a><\/h3>\n

Earlier this week, we were amused but not at all surprised to learn that Japanese citizens are buying safes like they\u2019re going out of style.<\/p>\n

The reason: negative rates and the incipient fear of a cash ban. \u201cLook no further than Japan\u2019s hardware stores for a worrying new sign that consumers are hoarding cash–the opposite of what the Bank of Japan had hoped when it recently introduced negative interest rates,\u201d WSJ wrote. \u201cSigns are emerging of higher demand for safes\u2014a place where the interest rate on cash is always zero, no matter what the central bank does.\u201d<\/p>\n

Put simply, the public has suddenly become aware of what it means when central banks adopt negative rates. The NIRP discussion escaped polite circles of Keynesian PhD economists long ago, and now it\u2019s migrated from financial news networks to Main Street.<\/p>\n

Although banks have thus far been able to largely avoid passing on negative rates to savers, there\u2019s only so long their resilience can last. At some point, NIM will simply flatline and if that happens just as a global recession and the attendant writedowns a downturn would entail occurs, then banks are going to need to offset some of the pain. That could mean taxing deposits.<\/p>\n

As we noted on Monday, circulation of the 1,000 franc note soared 17% last year in Switzerland in the wake of the SNB\u2019s plunge into the NIRP Twilight Zone. As it turns out, demand for big bills is soaring in Japan as well.<\/p>\n

\u201cDemand for 10,000-yen bills is steadily rising in Japan, even as the nation\u2019s population falls and the use of credit cards and other forms of electronic payment increases,\u201d Bloomberg writes.<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n","protected":false},"excerpt":{"rendered":"

Demand For Big Bills Soars As NIRP-Fearing Japanese Stuff Safes With 10,000-Yen Notes Earlier this week, we were amused but not at all surprised to learn that Japanese citizens are buying safes like they\u2019re going out of style. The reason: negative rates and the incipient fear of a cash ban. \u201cLook no further than Japan\u2019s […]<\/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],"tags":[57,124,452,6040,534,10045,10141,1389,1264,775],"class_list":["post-18276","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bank-of-japan","tag-central-banks","tag-japan","tag-main-street","tag-monetary-policy","tag-negative-interest-rate","tag-nim","tag-nirp","tag-recession","tag-switzerland"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18276","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=18276"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18276\/revisions"}],"predecessor-version":[{"id":18277,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/18276\/revisions\/18277"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=18276"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=18276"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=18276"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}