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German banks are hoarding so many euros they need more vaults

bloomberg.com

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Re: German banks are hoarding so many euros they need more vaults

#31

Post by njarboe »

H8crilA wrote: post #5
njarboe wrote: post #2

This problem has probably been exacerbated by the fact the the $500 euro note has not been issued since 27 April 2019[1]. I wonder if making storing euros in cash 2.5 times harder (500 versus 200 euro notes) was part of the reason the 500 euro was retired. [Edit] The legal storing of cash. The stated reason was the criminal use of cash. [1] https://en.wikipedia.org/wiki/500_euro_note

500 euro was (and is) essentially not used for any day to day payments - i.e. the most important reason for having printed paper as money.

True. But it is nice to have large bills when buying something that costs a lot, like a used car. I recently did that in the US and if I had some $500 or $1000 bill things would have went a bit smoother at that nervous time in the transaction when you are handing over to a person a big chunk of money.

Re: German banks are hoarding so many euros they need more vaults

#32

Post by wefarrell »

aazaa wrote: post #23
Despegar wrote: post #3

The crazy thing is that Germany is killing their own banks. They refuse to run fiscal deficits while at the same time they criticize the ECB for lowering rates and hurting the German Saver, when the German Saver is who would benefit if they decided tomorrow to run deficits for the next 10 years.

> ... when the German Saver is who would benefit if they decided tomorrow to run deficits for the next 10 years. The German Saver knows better than most that inflation destroys savings. Inflation benefits debtors by allowing them to pay back their loans in depreciated currency. Germany isn't exactly a nation of debtors, although most of Europe is. This is a looming political issue that's only just beginning.

What good is the EU if its wealthier members are unwilling to subsidize the poorer ones? Germans want the benefits of federation without the drawbacks.

Re: German banks are hoarding so many euros they need more vaults

#33

Post by njarboe »

TremendousJudge wrote: post #13
njarboe wrote: post #2

This problem has probably been exacerbated by the fact the the $500 euro note has not been issued since 27 April 2019[1]. I wonder if making storing euros in cash 2.5 times harder (500 versus 200 euro notes) was part of the reason the 500 euro was retired. [Edit] The legal storing of cash. The stated reason was the criminal use of cash. [1] https://en.wikipedia.org/wiki/500_euro_note

According to that same article, the reason for retiring the note was because the people who benefited the most from its existence are criminals, who need to do their business in cash -- the fewer notes, the easier for them. That includes storage, I guess. Still, I'm personally not in the eurozone, but in general terms for the end user high-denomination notes are not very useful unless you're gonna store them under yo…

Interesting, I don't see any mention retiring the note because of criminal use or anything about the 500 note at all. Is Bloomberb A/B testing the content of articles now? Would not be surprised, but it would be a disturbing trend.

Re: German banks are hoarding so many euros they need more vaults

#34

Post by MrRadar »

njarboe wrote: post #31
H8crilA wrote: post #5

Earlier quoted context omitted.

500 euro was (and is) essentially not used for any day to day payments - i.e. the most important reason for having printed paper as money.

True. But it is nice to have large bills when buying something that costs a lot, like a used car. I recently did that in the US and if I had some $500 or $1000 bill things would have went a bit smoother at that nervous time in the transaction when you are handing over to a person a big chunk of money.

Why couldn't you use a cashier's check?

Re: German banks are hoarding so many euros they need more vaults

#35

Post by bilekas »

Despegar wrote: post #20
cwperkins wrote: post #10

Earlier quoted context omitted.

Be careful what you wish for. I agree with Stieglitz that the Troika has historically not chosen the best path for crisis countries by implementing austerity. My fear with using Fiscal Policy and running deficits is that it is hard for a politician to win a campaign fighting for austerity if and when the debt binge becomes to great. From my own understanding, that is why monetary policy is strongly preferred because…

This is absurd in the context of Germany. They have a fetish with "fiscal responsibility". It'd be the natural inclination of every politician to cut back on deficits (and I imagine within a few years there'd be pressure to). Germany is a country with a broken military and infrastructure. They should spend money on that. They should cut taxes for workers. There's plenty of shit for Germany to spend money on, and it w…

I really hate this idea that everyone needs to just constantly be spending. It's useful but there is nothing wrong with having a slow stable fincal conscious ecconomy.

Re: German banks are hoarding so many euros they need more vaults

#36

Post by VBprogrammer »

njarboe wrote: post #31
H8crilA wrote: post #5

Earlier quoted context omitted.

500 euro was (and is) essentially not used for any day to day payments - i.e. the most important reason for having printed paper as money.

True. But it is nice to have large bills when buying something that costs a lot, like a used car. I recently did that in the US and if I had some $500 or $1000 bill things would have went a bit smoother at that nervous time in the transaction when you are handing over to a person a big chunk of money.

You tend to run into the problem that forging large notes has a much greater return on investment. People get nervous about accepting them. In the UK this definitely kicks in around the £50 mark.

Re: German banks are hoarding so many euros they need more vaults

#37

Post by brokensegue »

mrsun wrote: post #17
metalliqaz wrote: post #9

Earlier quoted context omitted.

why would banks care if it is anonymous?

banks don't care but the cash owners do. If you have 10.000 euros in cash and buy gold (in order to save space in the vault) the transaction will be registered. The government gets all details (name, date, amount etc). Instead if you put the 10.000 euros directly in the vault nothing will be tracked.

you seem confused, did you read the article? I don't know about German laws but if you deposit $10k in a US bank you are definitely tracked and not anonymous. Also, no "cash owner" would buy gold to save vault space. The incentives don't make sense.

Re: German banks are hoarding so many euros they need more vaults

#38

Post by kfichter »

njarboe wrote: post #33
TremendousJudge wrote: post #13

Earlier quoted context omitted.

According to that same article, the reason for retiring the note was because the people who benefited the most from its existence are criminals, who need to do their business in cash -- the fewer notes, the easier for them. That includes storage, I guess. Still, I'm personally not in the eurozone, but in general terms for the end user high-denomination notes are not very useful unless you're gonna store them under yo…

Interesting, I don't see any mention retiring the note because of criminal use or anything about the 500 note at all. Is Bloomberb A/B testing the content of articles now? Would not be surprised, but it would be a disturbing trend.

Commenter was referring to the Wikipedia article, their wording was a little confusing though.

Re: German banks are hoarding so many euros they need more vaults

#39

Post by [deleted] »

njarboe wrote: post #33
TremendousJudge wrote: post #13

Earlier quoted context omitted.

According to that same article, the reason for retiring the note was because the people who benefited the most from its existence are criminals, who need to do their business in cash -- the fewer notes, the easier for them. That includes storage, I guess. Still, I'm personally not in the eurozone, but in general terms for the end user high-denomination notes are not very useful unless you're gonna store them under yo…

Interesting, I don't see any mention retiring the note because of criminal use or anything about the 500 note at all. Is Bloomberb A/B testing the content of articles now? Would not be surprised, but it would be a disturbing trend.

[deleted]

Re: German banks are hoarding so many euros they need more vaults

#40

Post by rusk »

wefarrell wrote: post #32
aazaa wrote: post #23

Earlier quoted context omitted.

> ... when the German Saver is who would benefit if they decided tomorrow to run deficits for the next 10 years. The German Saver knows better than most that inflation destroys savings. Inflation benefits debtors by allowing them to pay back their loans in depreciated currency. Germany isn't exactly a nation of debtors, although most of Europe is. This is a looming political issue that's only just beginning.

What good is the EU if its wealthier members are unwilling to subsidize the poorer ones? Germans want the benefits of federation without the drawbacks.

It allows DE to have an artificially devalued currency which benefits their exports.
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