Demand For Big Bills Soars As Japan Stuffs Safes With 10,000-Yen Notes

• Negative interest rates mean legalized theft. The common sense thing to do is to take your money out of the bank. This is starting to happen in Europe and Japan. It implies bank runs and eventually banking system collapse. If governments adopt a ban on cash, then, the next logical move is to buy physical gold/silver and thus flee from cash in the bank. Smart money is already fleeing into physical gold/silver right now before the ban on cash is implemented.
  –
• When interest rates become increasingly negative banks will not be profitable. Banks will not offer new loans at zero or negative interest rates. They will go bust if they do. This implies economic contraction as the economy is fuelled by debt financing. Banks will also contract their existing loan portfolios ie. call back loans where interest rate is negative to stem losses. Customers with such loans will have to get refinancing or sell their assets. Again this is deflationary, because demand drops (as banks refuse to finance at NIRP) and supply increases as customers sell their assets.
  –
• Followed to its logical conclusion, NIRP (negative interest rate policy) implies economic/financial/banking system collapse. It will trigger a currency crisis as people abandon their currencies for physical gold/silver. Got physical gold/silver yet?
  –
• Demand For Big Bills Soars As Japan Stuffs Safes With 10,000-Yen Notes
  by Tyler Durden, www.zerohedge.com  
  Earlier this week, we were amused but not at all surprised to learn that Japanese citizens are buying safes like they’re going out of style.
  –
  The reason: negative rates and the incipient fear of a cash ban. “Look no further than Japan’s hardware stores for a worrying new sign that consumers are hoarding cash–the opposite of what the Bank of Japan had hoped when it recently introduced negative interest rates,” WSJ wrote. “Signs are emerging of higher demand for safes—a place where the interest rate on cash is always zero, no matter what the central bank does.”
  –
  Put simply, the public has suddenly become aware of what it means when central banks adopt negative rates. The NIRP discussion escaped polite circles of Keynesian PhD economists long ago, and now it’s migrated from financial news networks to Main Street.
  –
  read more.

end