The Cashless Society Is Going to Backfire for the Establishment

…the black market goes by another name: the free market. And the free market can’t be stifled in the long run. It will always produce an alternative to any law or regulation…by removing cash and creative negative interest rates, they’re placing a tax on every day life. And if the black market does what the black market does best, it will create an underground alternative to everything we want and need.

Unless, of course, they decide to do what Joseph Stalin did. He starved millions of Ukrainians to death by simply declaring the hording of food to be a crime punishable by death–execution on the spot. — jtl, 419

By Joshua Krause via Activist Post

There is nothing the banks would love more than to ban paper currency, though not for the same reason most gold bugs might like to do the same. If there were no cash, The Essence of Liberty: Volume I: Liberty and History: The Rise and Fall of the Noble Experiment with Constitutionally Limited Government (Liberty and ... Limited Government) (Volume 1)   then the banks would have absolute control over our savings, and we would all have to keep our money “in the system.” Governments would probably enjoy this as well. It would make it so much easier for them to track our purchases and profits, and tax them accordingly.

Environmental & Natural Resource Economics: The Austrian ViewThe desires of the banking cartel became perfectly clear two weeks ago when Willem Buiter, the chief economist for Citigroup, advocated banning cash to supposedly save the global economy.

The world’s central banks have a problem.

When economic conditions worsen, they react by reducing interest rates in order to stimulate the economy. But, as has happened across the world in recent years, there comes a point where those central banks run out of room to cut — they can bring interest rates to zero, but reducing them further below that is fraught with problems, the biggest of which is cash in the economy.

In a new piece, Citi’s Willem Buiter looks at this problem, which is known as the effective lower bound (ELB) on nominal interest rates.

Fundamentally, the ELB problem comes down to cash. According to Buiter, the ELB only exists at all due to the existence of cash, which is a bearer instrument that pays zero nominal rates. Why have your money on deposit at a negative rate that reduces your wealth when you can have it in cash and suffer no reduction?

Cash therefore gives people an easy and effective way of avoiding negative nominal rates.

The Essence of Liberty: Volume II: The Economics of Liberty (Volume 2)So basically what he’s suggesting is that by eliminating cash, it will make it easier for the banks to take your money. Right now it’s difficult for them to enforce a negative interest rate (which would ostensibly fuel the economy by making people spend money instead of saving it) because people will just take the cash out of their accounts. You can’t place a negative interest rate on money that’s hiding under your mattress.

The Essence of Liberty: Volume III: A Universal Philosophy of Political Economy (Liberty: A Universal Political Ethic) (Volume 3)They really just want to make it expensive for you to save money. They want you to spend it all on frivolous crap (to keep the global economic bubble going), which means that at some point it will return to the banking system, where they will be able to charge you even more than they already do, just for Combat Shooter's HandbookReconnaissance Marine MCI 03.32f: Marine Corps Institutethe privilege of keeping it there. Rinse and repeat until we’re all debt slaves.However, these bankers really haven’t thought this through. They probably believe that a cashless society will work, because of success stories like Sweden, where four out of five purchases are done electronically. What they’re not taking The Betrayed: On Warriors, Cowboys and Other Misfitsinto account is that Sweden has a successful economy despite going cashless, not because of it. They have a cohesive society with low crime rates, good schools, and an excellent infrastructure. They would have been successful either way.

A Handbook for Ranch Managers Planned Grazing: A Study Guide and Reference Manual But if they try going cashless in some basket case nation, they’re in for a rude awakening. I can already tell you what would happen in America. Unlike Sweden, it’s not going to stifle the black market, which is the biggest reason why governments want to go cashless.

It’s going to strengthen it.

The black market in the United States is a multibillion dollar economy. It’s been estimated that our black market may comprise at least 10 percent of our GDP. That’s a force to be reckoned with. That’s larger than the economies of most nations and corporations, and it consists of everything from drug cartels to babysitters. Do they really think that this powerful force will stand idly by as their wealth is forced into the light of day by an edict?

Eliminating cash won’t remove the desire to save money, and people who work in the black market already don’t like to deal with banks. This will only serve to push them even further away from the legitimate economy. Instead of cash, they will just find new ways to preserve their wealth.

In the years that followed the crash of 2008, what did fearful Americans buy to preserve their wealth? They bought everything the government doesn’t want us to own. Gold, silver, guns, storable food, cryptocurrencies, etc. These all went up in value. If this comes to pass, members of the black market will just put their money in real-world commodities and untraceable currencies, because there will be no other options if they want to stay away from the prying eyes of corporations and governments.

And unlike cash, which will occasionally find its way back into the banking system since people still need to write checks for their gas, electric, insurance, and water bills; many of these resources will never see the light of day again.

They should also consider what will happen if every single transaction causes you to lose money. If just having money means losing money. This will make it profitable for the black market to reach into every facet of the economy. Think prohibition, but applied to buying groceries and paying your rent. Everything that can be done informally, will be. This will, in time, pave the way for an economy that is separate from the one we currently operate in. It will create a viable alternative to the system we’ve been forced to endure.

Perhaps, this is difficult for us imagine because we’ve never experienced it. But in most cases the black market always finds a way, because the black market goes by another name: the free market. And the free market can’t be stifled in the long run. It will always produce an alternative to any law or regulation.

Money has become intrinsically connected to everything we want, need, and do, so by removing cash and creative negative interest rates, they’re placing a tax on every day life. And if the black market does what the black market does best, it will create an underground alternative to everything we want and need. And I mean everything.

The same situation occurred in the final days of the Soviet Union. Their dysfunctional system produced one of the most virulent and extensive black markets in history, and one could find just about any product or service there. There’s no reason why it can’t happen here. If they succeed in eliminating cash, their system will fade while the black market thrives. They’re too stupid and hubristic to realize that they’re fueling alternatives to their vision of the world, and sealing their own doom.

Joshua Krause is a reporter, writer and researcher at The Daily Sheeple, where this article first appeared. He was born and raised in the Bay Area and is a freelance writer and author. You can follow Joshua’s reports at Facebook or on his personal Twitter. Joshua’s website is Strange Danger.


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The Essence of Liberty: Volume II (The Economics of Liberty)The Essence of Liberty Volume II: The Economics of Liberty Volume II will introduce the reader to the fundamental principles of the Austrian School of Economics. The Austrian School traces its origins back to the Scholastics of Medieval Spain. But its lineage actually began with Carl Menger and continued on through Adam Smith, Ludwig von Mises, Murray Rothbard and many others. It is the one and only true private property based, free market line of economic thought. Available in both paperback and Kindle versions.

You might be interested in the other two volumes of this three volume set: The Essence of Liberty Volume I: Liberty and History  and The Essence of Liberty Volume III: Liberty: A Universal Political Ethic.

About Land & Livestock Interntional, Inc.

Land and Livestock International, Inc. is a leading agribusiness management firm providing a complete line of services to the range livestock industry. We believe that private property is the foundation of America. Private property and free markets go hand in hand—without property there is no freedom. We also believe that free markets, not government intervention, hold the key to natural resource conservation and environmental preservation. No government bureaucrat can (or will) understand and treat the land with as much respect as its owner. The bureaucrat simply does not have the same motives as does the owner of a capital interest in the property. Our specialty is the working livestock ranch simply because there are so many very good reasons for owning such a property. We provide educational, management and consulting services with a focus on ecologically and financially sustainable land management that will enhance natural processes (water and mineral cycles, energy flow and community dynamics) while enhancing profits and steadily building wealth.
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