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Banks, gangsters and the strange resurgence of cash

economist.com

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Re: Banks, gangsters and the strange resurgence of cash

#71

Post by inopinatus »

tristor wrote: post #68
inopinatus wrote: post #60

Earlier quoted context omitted.

> There is a lot of rumor and speculation about very benign things. There is certainly misrepresentation and rumour-mongering in these comments, but not in the article, and there's nothing benign about international money laundering, or more precisely, nothing benign about the people it enables. > $50 Billion in cash is basically nothing. It's like 2% of currency in circulation. This is very far from the numbers quot…

One thing that's also benign but not mentioned by the grandparent is that any economy which has considerable foreign travelers passing through will likely end up losing some cash. I have two pint glasses sitting on my desk, one for coins, the other for bills, they are literally packed full of money from my various travels. Last time I checked, I had almost 300 euros in there and I haven't been in the Eurozone in quit…

I too have a drawer of various currencies, some of them even since retired, or issued by governments/nations that no longer exist.

However, given that international travel took a nosedive in the last 18 months whilst banknote production continued to stampede, I'd have to suggest that hoarding by globetrotters doesn't account for any current discrepancy in production vs use in observable trade.

Re: Banks, gangsters and the strange resurgence of cash

#72

Post by TheBobinator »

rsj_hn wrote: post #6

There is a lot of rumor and speculation about very benign things. 1. Precautionary savings. In a low interest rate environment, there is not the same penalty for holding cash as getting interest in a savings account. A lot of people find it prudent to have a buffer of cash, say enough to cover 1 month of expenses. So cash withdrawn from an ATM but put into a piggybank or under the mattress will appear here as "missin…

Almost all US banks have had upside down Texas ratios since 2000. Used to be savings accounts paid the rate of inflation, but not paying inflation and driving investments into riskier classes is the way they are driving revenue to pay off their bad debts.

With covid, the likelihood of bank failures has risen considerably as the savings money is drying up or moving out of cities and investment risks have raised considerably. Historically, whenever banks got systemically over-levered and they try to avoid a systemic banking collapse, they come for the commoners assets. Last time around they did gold confisaction. I remember in 08 they were talking about confiscating 401k money into the stock market.

This is no different. This is a creepy article full of trite anecdotes and observational BS that demonizes anyone that uses cash as a drug dealer or sex trafficker and doesn't mention the root issue.

Re: Banks, gangsters and the strange resurgence of cash

#73

Post by joe_the_user »

eganist wrote: post #4
h2odragon wrote: post #2

They are circulating in places beyond the borders, I assume. We let North Korea print their own$100 bills for years as a form of off the books aid, but once that stopped the underworld needed someone to provide the currency. Remember the pallets of cash being sent to Iraq?

I had to Google the north korea thing. https://en.wikipedia.org/wiki/Superdollar TIL. Thanks!

I'd just note a full read of the article shows that the origin of the bills is apparently quite murky and North Korea is just one of several accused sources. Israel blames Syria, some US media blames the CIA. Nothing is proven and nothing is certain.

Re: Banks, gangsters and the strange resurgence of cash

#74

Post by dylan604 »

mandelbrotwurst wrote: post #64
dylan604 wrote: post #54

Earlier quoted context omitted.

I understand the rational thinking of gold exchanges. You missed the detail about this being confusion on preppers. If the world has gone to shit (nuclear war, zombies, etc), then gold just isn't that useful. If it was silver, you could at least melt it down and kill the vampires with it. You're attempting to use logic in a place where there is none.

Hyperinflation and concerning political instability worth relocating over can happen without quite reaching the level of a zombie apocalypse.

But is this what preppers are really prepping for? Maybe I'm just too far into the conspiracy theorists and what not, but my personal experience with preppers are way way way futher than fears of social unrest.

Re: Banks, gangsters and the strange resurgence of cash

#75

Post by joe_the_user »

smokelegend wrote: post #33
petilon wrote: post #11

Earlier quoted context omitted.

> We let North Korea print their own $100 bills for years as a form of off the books aid That's very hard to believe. Citation needed!

See previous "Super Bill" Wikipedia link comment. It happened/may still be happening for all we know.

The wikipedia article could in no way be summarized as "we let Korea print $100 bills". A first sentence is "A superdollar (also known as a superbill or supernote) is a very high quality counterfeit United States one hundred-dollar bill,[1] alleged by the U.S. Government to have been made by unknown organizations or governments". The body of article follows this. Only dubious allegation that North Korea (among several groups) print them and no allegations that the US allowed this.

Link if it gets lost: https://en.wikipedia.org/wiki/Superdollar

Re: Banks, gangsters and the strange resurgence of cash

#76

Post by fy20 »

eganist wrote: post #4
h2odragon wrote: post #2

They are circulating in places beyond the borders, I assume. We let North Korea print their own$100 bills for years as a form of off the books aid, but once that stopped the underworld needed someone to provide the currency. Remember the pallets of cash being sent to Iraq?

I had to Google the north korea thing. https://en.wikipedia.org/wiki/Superdollar TIL. Thanks!

The most interesting part of that article was this:

> On 21 December 2011, the Irish High Court dismissed the US application for Garland's extradition,[4][25] as the alleged offence took place in Ireland and was therefore not subject to extradition.

I wonder why the UK doesn't have that clause but Ireland does?

Re: Banks, gangsters and the strange resurgence of cash

#77

Post by anonporridge »

dghlsakjg wrote: post #67
Spooky23 wrote: post #43

Earlier quoted context omitted.

Depends on the bank. Most branches are really sales offices. Usually there’s a few that actually stock cash.

That’s wild. When I was a teller (15 years ago maybe) we would routinely keep around 7-10k in our drawers, and another 40k as ready money in the day safe. Granted, we were a drive up branch that dealt with commercial/retail so a lot of customers would routinely be dealing with 5k worth of cash. Other branches had similar amounts of cash though. Strange world

I've also been hit by not being able to withdraw more than about $5k cash as a retail customer without multi day notice. I do wonder if it's not all nefarious as cash has become drastically less common over the past couple decades.

Still, it's especially interesting because the numbers even 15 years ago are much higher in real terms than today.

This is another advantage of inflation.

You can set rules like, you have to declare more than $10k worth of assets traveling with you on flights, and every year, the plummeting value of that dollar metric includes more and more people and activities in the surveillance state.

Re: Banks, gangsters and the strange resurgence of cash

#79

Post by anonporridge »

vl wrote: post #56
anonporridge wrote: post #25

Earlier quoted context omitted.

Fire/water proof safes aren't terribly expense. Also, safe deposit boxes are an option, which have different security tradeoffs from a safe in your home.

Banks close first, for emergency supplies safe deposit boxes are basically useless.

Depends on the scenario.

If it's a societal event, then yes, you can't rely on safe deposit boxes, just like you can't rely on your bank account. You're better off shoving cash under your mattress and stacking brass and lead.

But if it's an individual event, then your home itself might be a target, and safe deposit boxes might mitigate your risk.

It's all about tradeoffs.

Re: Banks, gangsters and the strange resurgence of cash

#80

Post by onlyrealcuzzo »

StanislavPetrov wrote: post #78

I find it strange that people trust the banks with their money, given their history and their behavior.

Deposit insurance?

https://en.wikipedia.org/wiki/Deposit_insurance

It seems like most countries have an equivalent of FDIC.

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