On Monday, during a trip to Japan, Apple CEO Tim Cook vented his spleen once more against physical currency, telling the Nikkei that “we don’t think the consumer particularly likes cash.”
It’s a bizarre conclusion to reach, especially in Japan where cash is still the undisputed king. At ¥90 trillion ($885 billion), or about a fifth of gross domestic product, the value of banknotes in circulation is the highest in the world as a proportion of the economy. Many small businesses, including many restaurants, don’t even take plastic. Yet, the country was also the first to popularize mobile wallets and smartphones.
“We would like to be a catalyst for taking cash out of the system,” Cook said, his mind fixed on Apple Pay, which takes a cut on every transaction it processes.
Yet Apple Pay isn’t generating substantial revenue for the company, as Fortune points out. The service — as with just about everything Apple ever produced — is only compatible with Apple’s own products, leaving the more than a billion people worldwide who use Android-based smartphones out of the loop. Not to mention the billions more who don’t use a smart phone at all.
But cash’s days are numbered, as technological advances and changes in generational priorities dampen its allure. The world is brimming with individuals and institutions determined to put it out of its misery.
The Usual Suspects
Top of the list are the world’s central banks, which have the perfect motive for whacking cash: i.e. to make negative interest rates an eternal — or at least, more enduring — reality. And the only way to do that is to stop depositors from cashing out, as the Bank of England chief economist Andrew Hadlaine all but admitted in 2014.
Japan and Europe are already deep into negative territory, and Fed Chair Janet Yellen has already said that the U.S. should be prepared for the same outcome. But as long as cash exists, there’s no way of preventing depositors from doing the logical thing – i.e. taking their money out of the bank and parking it where the erosive effects of NIRP can’t reach it.
Central banks are not the only ones who dream of a cash-free world. For credit card companies, cash is the ultimate rival. As such, it’s no surprise that the likes of Visa and MasterCard are among those pushing the hardest for a cashless economy. For banks, the benefits are no less obvious, including cost cuts, greater control over the flow of customer funds, and larger fees.
As for politicians, Eurocrats and global plutocrats, including the senior servants of the IMF, World Bank and United Nations, they will enjoy even greater access to and dominion over the people’s funds. What better way of controlling the people than by controlling their access to the money they need to survive? It would amount to what Martin Armstrong calls “totalitarian control over the economy.”
These powerful agents have already created a perfect platform for achieving their dream: The Better Than Cash Alliance (BTCA), a UN-hosted partnership of governments, companies and international organizations. Its purpose, in its own words, is “to accelerate the transition from cash to digital payments globally through excellence in advocacy, knowledge and services to members.”...MUCH MORE
Thursday, October 20, 2016
"Who’s Powering the War on Cash?" (AAPL)
From Wolf Street: