IMF Tells Governments How to Subvert Public Resistance Against Elimination of Cash

By Norbert Häring and cross-posted from his blog

(DQ: This is a really important [and worrying] development that passed me by when it was originally reported, in April this year)

The International Monetary Fund (IMF) in Washington has published a Working Paper on “de-cashing”. It gives advice to governments who want to abolish cash against the will of their citizenry. Move slowly, starting with seemingly harmless measures, is part of that advice.

In “The Macroeconomics of De-Cashing”, IMF-Analyst Alexei Kireyev recommends in his conclusions:

Although some countries most likely will de-cash in a few years, going completely cashless should be phased in steps. The de-cashing process could build on the initial and largely uncontested steps, such as the phasing out of large denomination bills, the placement of ceilings on cash transactions, and the reporting of cash moves across the borders. Further steps could include creating economic incentives to reduce the use of cash in transactions, simplifying the opening and use of transferrable deposits, and further computerizing the financial system. 

The private-sector-led de-cashing seems preferable to the public-sector-led decashing. The former seems almost entirely benign (e.g., more use of mobile phones to pay for coffee), but still needs policy adaptation. The latter seems more questionable, and people may have valid objections to it. De-cashing of either kind leaves both individuals and states more vulnerable to disruptions, ranging from power outages to hacks to cyberwarfare. In any case, the tempting attempts to impose de-cashing by a decree should be avoided, given the popular personal attachment to cash. A targeted outreach program is needed to alleviate suspicions related to de-cashing; in particular, that by de-cashing the authorities are trying to control all aspects of peoples’ lives, including their use of money, or push personal savings into banks. The de-cashing process would acquire more traction if it were based on individual consumer choice and cost-benefits considerations.

Note, that the author is not talking about unreasonable objections and imagined disadvantages: He does count it among the advantages of de-cashing in the very next paragraph that personal savings are pushed into banks and he also does count total control of all aspects of financial life under the pros, as in the last sentence of the last quote below:

 

“As de-cashing gives incentives to economies’ agents toconvert their currency in bank deposits, the deposit base of the banking system will increase, which can help reduce the lending rates and expand credit.”

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6 thoughts on “IMF Tells Governments How to Subvert Public Resistance Against Elimination of Cash

  1. At least there is one positive to old age; the time remaining to the aged individual to be controlled by politicians and unelected officials is diminishing!

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  2. People will barter , use gold and silver, and create local script money.
    Russian philosopher Fyodor Dostoevsky in the 1800s said, “Money is coined liberty.”
    “Cash” is your PRIVATE PROPERTY. It is the physical representation of your time at work or your intellectual output.
    “The desire of gold is not for gold. It is for the means of freedom.” — Ralph Waldo Emerson
    To ban cash is to steal your PRIVATE PROPERTY. People will resort to barter, gold & silver and creating local scripts.
    Plus it is truly “THE Mark of the BEAST” since every tiny transaction will be recorded and a FEE skimmed off by the BANKERS, which is why the BANKERS push it.

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  3. You mean like V the so called gorilla economist. With his sidekick CJ or Bix Weir pushing crypto currency. While talking about how bad fiat currency is? All the while pushing something that is only based on technocrat philosophy.
    You know I just love it when the Cj says he absolutely sees no cash is his everyday activities.
    Yet, I do remember when the atms and debit cards came around claiming that the transaction fee would always be small. Say like the first time I used one and the fee was .35c. Now I encounter fees as high as $5.. So much for the small fee.
    So when they get what they ultimately want. How long do you think it will take for them to turn your account off. When THEY decide YOU are not COMPLYING with everything THEY will DEMAND from YOU. How Long? Warning: They will never stop demanding more.
    So can someone show me where liberty and freedom will be. When you make YOURSELF totally DEPENDENT on them. This is the PANOPTICON of Bentham.
    What seems to be harmless is the trap. NO matter how easy your life may seem to be.

    noman
    Arizona

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