
The War on Cash - known
https://www.corbettreport.com/the-war-on-cash-a-country-by-country-guide/
======
belorn
I would not mind the problem as much if Banks worked like banks of old rather
than opinionated service provides. Banks today limit how much cash is
withdrawn and for what purpose, and any transaction is added to a permanent
record. This record is then turned into precious customer data which can be
used for any internal purposes, shared with partners (like insurance
providers), and given to several government departments like tax collection,
social security, the local police, secret police, national spy agency, foreign
police and spy agencies, and so on. The customer has zero control and is
barely recognized to be a stake holder at all.

It is possible to create the cashless society without the above problems, but
no governments or banks are interested.

~~~
witty_username
Could you elaborate on how the "banks of old" were better?

~~~
belorn
They used to be custodian of money deposited in their care. Ownership was
clear, as was the role of the bank. At no point could they refuse a withdraw,
as doing so would ruin the precious trust they needed in order to be a bank.

The few times that trust was lost, we have a historical records of a bank
crisis where people rushed to the bank to get back _their_ deposited money. A
bank today can just declare a maximum withdraw limit and act as if it is
normal operation (most banks in Sweden have today a continuously maximum of
$1500 limit per week on cash withdraws).

~~~
vitd
> most banks in Sweden have today a continuously maximum of $1500 limit per
> week on cash withdraws

Wait, what? Are you seriously saying that if you want to pay cash for a $3,000
notebook computer, you have to make 2 different withdrawals a week apart to do
that? How is that workable? What happens when you have an emergency and need
more cash than that all at once? I mean, it doesn't come up frequently, but it
comes up from time to time. Does writing a large check count? Or only
physically withdrawing the money at a teller?

~~~
st3v3r
No, it means you go into the bank itself and explain your situation. The
limits are to stop someone who steals your bank card from going to an ATM and
draining your account.

~~~
belorn
Its not that easy. You have to physical go to a office that deal with cash.
Its not permitted to be done through the phone, and only a small subset of
bank offices deal with cash.

You also don't get the cash immediately, but have to wait a minimum of several
bank days. Also, as regulation against money laundry require, you must tell
the bank as to the purpose of the withdraw and they are permitted to deny it.

Its much more than just "stop someone who steals your bank card".

------
vaadu
Cyprus had bank account seizures and some eastern European nations seized
private pension accounts. You can't seize what you don't control.

No cash means no anonymity No cash allows banks to charge negative interest
rates

~~~
cesarb
Here in Brazil, we had the "Confisco da Poupança" in the 90s. According to
Wikipedia
([https://pt.wikipedia.org/wiki/Plano_Collor](https://pt.wikipedia.org/wiki/Plano_Collor)),
80% of every bank account above some value was frozen for 18 months.

Even nowadays, rumors of a new "confisco" are enough for some people to take
all their money out of their bank accounts (even though constitutional
amendment 32, written a decade later, contains a clause specifically designed
to prevent another "confisco").

~~~
dmichulke
At the current rate of inflation (12%?) the government taxes you even if you
don't have your money in the bank.

~~~
st3v3r
That claim makes absolutely no sense. Taxes are revenue the government brings
in. It can then use that money to do stuff. Inflation does not bring in
revenue, and does not make it possible for the government to do stuff.

~~~
cmsmith
Unless the inflation is caused by the government printing money.

If 10 citizens each have $10, then there are $100 in the money supply. Now the
government prints $10. If no actual value was created with that $10, then the
value of the dollar has to drop. Now all the citizens have $9.1 (real value)
and the government has $9.1 (real value). This is the same as a 10% tax on
wealth.

~~~
thaumasiotes
From the given numbers, it sounds like a 9% tax.

------
logfromblammo
I heard just this morning over the radio that some bureaucrat was floating the
idea of a moratorium on the printing of new US$100 and US$50 Fed notes.

The bit explicitly mentioned that US$1M fits neatly inside one briefcase when
using US$100 bills, but it would take three briefcases with US$20 bills.

This may be true, but I'm a little wary of the argument now, as the drug
trade, counterfeiting, and money laundering line was used when the US$1000 and
CAN$1000 notes were retired, and they are worth less now than they were then.
Loss of high denomination banknotes has not impeded the business of the
underworld, but loss of cash transactions means that everyone in legit
business now has to pay a tax to Visa and Mastercard for acting as an
intermediary in payments processing.

A pile of $100 bills is $100/g, or $45400/lb. $50 bills are $50/g, or
$22700/lb. A $20 bill is about $20/g, or $9080/lb. Gold is $38.82/g, or
$17607.88/lb. Clearly, if you eliminate the US$100, cash movers switch to the
US$50. If you eliminate that, they switch to gold, not the US$20.

US$1M in $100 bills is 22 pounds (10 kg) of cash. In US$50 bills, it is 44
pounds (20 kg). In gold, it is 57 pounds (26 kg). In US$20 bills, it is 110
pounds (50 kg).

 _Someone_ in the monetary bureaucracy _might_ want to reconsider the
_unintended consequences_ of the black market drug trade switching to gold as
its preferred currency rather than paper money.

~~~
Symbiote
Gold is going to be somewhat harder to spend.

"The Serious Organised Crime Agency claimed that "90% of all €500 notes sold
in the UK are in the hands of organised crime", revealed during an eight-month
analysis." [1]

€500 weighs 1.12g, but is worth $1.11, so US$1M in €500s is 2kg. A very decent
saving.

Of course, the UK doesn't use the Euro, so it would be interesting to see the
same analysis done in several different Eurozone countries.

[1]
[http://news.bbc.co.uk/2/hi/uk_news/8678886.stm](http://news.bbc.co.uk/2/hi/uk_news/8678886.stm)

------
qq66
The actors who the government has the most legitimate interest in surveilling
(drug cartels, racketeers, corrupt officials, etc.) are the best-equipped to
switch from paper currency to alternate currencies (precious metals, gems,
etc).

~~~
flatline
They are also the best equipped to launder money _through the banking system_
regardless of its origin: that is what they already do!

------
dtornabene
Its 6 hours in and all but one of the subthreads have ignored (or simply don't
care?) that this guy and his various sites/media is either straight up crazy
or disinfo. This guy literally has an hour long youtube video on "Agenda 21".
A sibling comment notes that they "hope these sorts of blogs don't become
mainstream on hn". Its kind of important insofar as any sense of community is
involved to reiterate that. This is serious garbage, one can find any number
of discussions of money, utility and politics ranging from any ana-cap to
anti-cap. This is mindless tripe.

------
kazinator
As long as there are politicians, there will be cash.

You can't (or don't want to) accept bribes, buy votes or hire
hookers/strippers with traceable payment methods.

~~~
Kiro
I presume you've never been to Europe. I don't remember the last time I saw
real physical cash. It's very uncommon.

~~~
brightsize
In my most recent trips to Germany, 2013/14, the opposite was the case. Cash
seemed to be the most common way of paying for things. At food stores almost
everyone was paying with cash though there was some sort of card reader (debit
I assume ...?) that I saw people using occasionally. As someone from the US
where in my experience electronic transfers are the norm, I was pretty
astonished to find that the home of the EU central bank was still running on
cash.

~~~
thesimon
>At food stores almost everyone was paying with cash though there was some
sort of card reader (debit I assume ...?) that I saw people using
occasionally.

There is a popular domestic EFTPOS scheme used in Germany. A lot of small
shops (especially restaurants) don't use it though because it leaves a
papertrail (ie. you have to pay taxes on it). Often Maestro/VPay will be
accepted though.

In terms of card payments in general: A lot of people associate (credit) cards
with being poor, in debt and having no control on how you are spending your
money. Cash on the other hand is associated with having control on how much
you are spending. I've even seen people apologizing at the register, because
they are paying a "small amount" ($5+) with card.

Almost all big stores accept credit cards now though after the European union
cut the fees.

------
snarfy
"This note is legal tender for all debts, public and private"

Once services have been rendered, it's illegal for someone to not accept cash
as payment.

~~~
akgoel
Unless, of course, physical cash no longer exists, and all you have is some
sort of ephemeral digital cash in a financial institution that can be easily
subject to a negative interest rate policy. A bank balance can lose nominal
value with NIRP, but cash in-hand can't. Hence, the War on Cash.

~~~
Swizec
Physical cash CAN lose value. Very fast too.

My parents lived through the hyperinflation in Yugoslavia in the 90's. The
stories they tell are ... fun. Ideally you exchanged everything into deutsche
marks as soon as you got it.

New denominations were being printed every few weeks because the currency was
losing value etc.

Hell, even when we became Slovenia I remember that at first, the highest bill
was 1,000. Just ten years later, the highest had to be 10,000 because the
thousand one just wasn't cutting it anymore. It was too impractical for the
prices.

For a more drastic example: in pre-war Germany it was more common to get
mugged for bread than for cash. Wads of cash just weren't worth enough to
bother.

~~~
CompelTechnic
Nominal value was the important term in the parent, i.e. a 100 dollar bill
can't become a 99 dollar bill.

~~~
Swizec
Sure, but nominal value is not what you use to buy things. The nominal value
in my bank account won't just go down on its own either. But what I can do
with it will.

Or is there a mechanism I don't know about that can lower nominal numbers in
untouched bank accounts?

~~~
dragonwriter
> The nominal value in my bank account won't just go down on its own either.

It would with negative interest rates.

~~~
gegtik
presumably to reduce the inflation of prices. 6 of one, right?

------
bertil
As someone who had to carry large amounts of cash regularly, I feel like the
author is neglecting many of the costs of cash. Personal security is one of
them, and certainly one that local government care a lot more about than
controlling drug traffic.

As someone who lived in Northern Sweden, freezing your fingers off is another
— albeit negligible.

More seriously, I doubt that rampant inflation was the tool Argentinian
government used to force a technologically unimaginable solution on its
citizen.

~~~
bertil
Fake money is probably the bigger issue overall though.

------
danbolt
I found the bit of this article on the Canadian penny a bit irrelevant, and
perhaps misleading. Or, I'm under the impression that it was discontinued due
to the fact that one or two cents were a fraction of the average purchase,
rather than some sort of initiative to discourage cash usage.

I'm not very interested in using Bitcoin at the moment, but I like how its
design could enable me to have some representation of electronic currency that
could give some of the decentralized flexibility of cash. Perhaps a cashless
society could employ structures such as those.

~~~
soperj
Yeah, the Canadian penny was discontinued because it actually cost more than a
penny to make. Also pennies are useless.

~~~
Afton
I don't think this is true. Coins are multi-use. Obviously the government
wants to pay as little as possible in production costs, but there isn't any
reason that the production cost has to be strictly less than the unit-cost of
the money.

~~~
hluska
A relevant quote from the Royal Canadian Mint:

 _In Economic Action Plan 2012, the Government announced it would phase out
the penny from Canada 's coinage system. The decision to phase out the penny
was due to its excessive and rising cost of production relative to face value,
the increased accumulation of pennies by Canadians in their households,
environmental considerations, and the significant handling costs the penny
imposes on retailers, financial institutions and the economy in general._

(Source - [http://www.mint.ca/store/mint/about-the-mint/phasing-out-
the...](http://www.mint.ca/store/mint/about-the-mint/phasing-out-the-
penny-6900002#.VsTJNkXOfv4))

~~~
Afton
Huh, they do say 'relative to face value'. I still think that reasoning is
flawed, but I'm not going to argue with the RCM.

Thanks for the link!

------
Johnie
Larry Summers, former Treasury Secretary, recommends that the US eliminate any
denomination over $20 to reduce illicit activities.

[http://www.marketwatch.com/story/why-larry-summers-wants-
to-...](http://www.marketwatch.com/story/why-larry-summers-wants-to-take-away-
the-100-bill-2016-02-16)

------
waterlesscloud
My stepdad operates a network of privately owned ATMs. You wouldn't believe
the hoops he's had to jump through with banks to keep them stocked up with his
own money.

~~~
joering2
+1 and seriously interested. Can you elaborate??

------
entwife
I use cash (or check) to avoid the "Visa/MasterCard" tax -a few percent on
each transaction. If there was a zero cost way for ordinary US citizens to
move smallish sums ($1-500) electronically I'd use that instead.

~~~
droffel
Wouldn't it be cool if there was some sort of "electronic money", so to speak,
that could be send between people at low cost over the internet?

~~~
thescriptkiddie
I'm not sure if you're being facetious, or if you've never heard of Bitcoin.

~~~
dtparr
Having no personal experience with Bitcoin, do the exchanges not take a cut
(either directly, or by adjusting exchange rates such that $X -> Y BTC -> $Z
where Z < X)?

~~~
droffel
There are fees for conversion between BTC <-> USD. So long as you stay in BTC,
the cost is ~$0.03 (at the moment) per transaction, regardless of size.
Eventually, the goal is for a "closed loop" to form between suppliers,
manufacturers, and retailers, to avoid the currency conversion costs. When you
aren't paying a middleman a cut to convert between currencies, Bitcoin is
extremely cost efficient.

Also, on volatility: As market cap rises, the volatility will necessarily
decrease. The "wild 10% swings in a day" phase is just a phase, I wouldn't
expect BTC to be more volatile in the future than, say, gold, or any national
currency like the Yen (which itself has swung 10% in value in the past 2
weeks). This is because as the market cap rises, it takes more and more
capital to influence the price significantly. Right now, any random person
with $10,000,000 can cause a swing, whereas if the market cap was 10x higher,
it would require ~$100,000,000 to have the same effect in terms of percentage.

~~~
dtparr
Right, I understand that if you stay in BTC, things are better, and that long-
term, the idea is that everyone accepts it and pays out with it so you don't
have to keep converting and your point on volatility is a good one.

But as of today, I don't get paid in BTC, I can't pay for any of my 'standard'
expenses (mortgage, utilities, etc.) in BTC, so if I owe my friend $50 and
want to cover that electronically, if I use BTC, it's likely he'll end up with
something more like $48 (or whatever) if he wants to actually buy something
with it, which seems to be approximately the same situation as a "Visa tax",
but with less predictability. Your Yen example is a good analog, actually. I
also don't pay him in Yen for the same reasons. I don't get paid in it, he
can't buy most things with it, and doing so would effectively reduce the
amount of money due to conversions.

Frankly, when I'm owed money in the $0-100 range, I generally just ask for an
electronic Amazon gift card. It's basically instant, there's no fee or
conversion penalty, and we buy enough there that in those sorts of amounts,
it's about as liquid an asset as there is. I understand this doesn't further
any sort of advance, and perhaps even reverses it, but it's certainly pretty
painless. That being said, it's not something I'd want to accept large amounts
of with any frequency.

~~~
droffel
Adoption is a process, not an event. These things take time. Sure, its
inconvenient at the moment to do things on the bleeding edge, but things are
rapidly improving.

------
recursive
How are people going to buy drugs in the cashless future? I can't see it
working.

~~~
dragonwriter
> How are people going to buy drugs in the cashless future?

Barter (including exchange of services as well as goods).

~~~
ericras
Tide detergent: [http://nymag.com/news/features/tide-detergent-
drugs-2013-1/](http://nymag.com/news/features/tide-detergent-drugs-2013-1/)

------
carsongross
This is about NIRP, which is fundamentally about the bankruptcy of the current
monetary/banking system.

The crime talk is just a distraction.

------
MikeNomad
I'm not seeing an article about a war on cash. Rather, I'm seeing an article
about the elimination of instruments that are not Global Reserve Currencies.

The idea that the US would do away with FRNs has so many outcomes/levels
associated with it, I can't get my head around it.

------
jcfrei
I really hope that these types of blogs don't become mainstream on HN.

~~~
utrex
It's not just the alarmist tone or the jittery pacing that makes this listicle
unworthy of broad attention, it's the rhetorical errors as well. The author
attributes this change to a war on cash rather than a global trend in response
to common pressures and doesn't provide any strong evidence that governments
themselves are driving these forces.

The selected links contain plenty of anecdotes but few balanced studies or
statistics about why these changes are happening.

There's an interesting element of truth here: the world is moving to new
systems of payment and cash use is declining, but the author is trying to
frame this as dangerous without deriving a strong argument and is not clearly
framing the status of cash. 1 stars for an interesting premise and a weak
execution.

~~~
ihavedna
I think the upvotes are coming from an interest in this particular subject
more than the source. I would like better material collected on the subject.
Anyone have an alternative choice for research or discussion on this subject?

------
hobarrera
Data on the article is quite outdated by a couple of years, at least for
Argentina. Most noticeably, tax for purchases outside the country are 35%, not
15%. "Blue dollars" are no longer a thing, since the government has not
allowed people to buy dollars legally again.

------
jakobegger
At the risk of getting a few downvotes, I'm going to state that I'm all for
outlawing cash payments for amounts larger than a few thousand dollar/euro.

Corruption and tax evasion are a big problem in Austria (as presumably in most
parts of the world), and cash payments make them so much easier.

I just don't see a legal reason why I'd want to pay for a large purchase in
cash. Almost all large purchases require some kind of paper trail anyway, so
it's not like giving up cash means giving up your anonymity.

Am I missing something obvious?

~~~
Swizec
In Slovenia it is illegal to use cash for [business] transactions bigger than
100 or so euro. I moved out soon after that happened for unrelated reasons,
but I haven't heard anyone non-shady complain.

I haven't heard of any definitive results in driving down corruption and the
grey market either though.

~~~
tempodox
The fact that people don't understand the risks they're exposed to doesn't
make those risks go away. And once the data is exploited it'll be too late.

