Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

The War on Cash: Bye-Bye 500-Euro Note

  by    1   1

Well, that didn’t take long.

In February, we reported that a former Obama economic adviser/ex-Treasury Secretary had floated the idea of eliminating the $100 bill and the 500-euro note in the escalating war on cash.

euro-note-1205315_960_720

On Wednesday, the European Central bank announced it will stop producing and issuing 500-euro notes around the end of 2018. Once the bank stops issuing the notes, those remaining in circulation will remain legal tender – at least for the time being.

In a press release, the EBC said it made the decision to eliminate the 500-euro note due to “concerns that this banknote could facilitate illicit activities.”

Virtually all of the mainstream reporting went with this “we’re doing it to fight crime” spin. Take this opening paragraph from the New York Times:

A suitcase stuffed full of cash may soon be worth a lot less. In a move aimed at hampering cash transactions by terrorists, drug dealers and money launderers, the European Central Bank on Wednesday announced an end to the 500-euro bank note, worth roughly $575.”

Subscribe to Peter Schiff’s Gold Videocast

But buried deep in the Times story, the reporter swerves into the truth. There is another, more fundamental reason central banks want to eliminate large bills:

One leading German economist also accused the European Central Bank of ulterior motives. With fewer large bills, it will be easier for the central bank to push interest rates to new lows, said Clemens Fuest, president of the Ifo economic research institute in Munich, which has been critical of the central bank’s cheap money policies. That is because for almost two years the European Central Bank has been charging lenders a so-called negative interest rate to keep money in its virtual vaults, which are considered the ultimate safe haven…In theory, banks can avoid this de facto rent on their deposits by holding cash in their own vaults. But in practice it is expensive to store large amounts of bills safely — and it would become even more so if the denominations were smaller.”

And there you have the crux of the war on cash. It’s not really about controlling “criminals.” It’s about controlling you.

Get Peter Schiff’s latest gold market analysis – click here for a free subscription to his exclusive monthly Gold Videocast.
Interested in learning more about physical gold and silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!


Related Posts

Peter Schiff: We Won the Trade War We Never Fought

Just like that, it appears the trade war is over. Although, as Peter Schiff pointed out in his latest podcast, it wasn’t really much of a war. I don’t think I should call it a ceasefire because nobody actually fired a shot, and it’s been more of a war of words than a real conventional […]

READ MORE →

Our Great-Grandchildren Are Already Broke

Your great grandchildren are broke. They may not even be born yet, but they are still broke. The government has spent us, our children, our grandchildren and even our great-grandchildren into a black hole of debt. The world is drowning in debt. At some point, somebody will have to pay for it – one way […]

READ MORE →

Warren Buffet Misses the Point: Gold Is Money

Warren Buffett has never been a fan of gold and has publicly disparaged the yellow metal on more than one occasion.  During his annual shareholders meeting earlier this month, he compared investing in gold and stocks, arguing that over the long term gold is an “unproductive asset” that “doesn’t produce anything.” So, why have it, unless […]

READ MORE →

Golden Years or Retirement Nightmare?

Do you dream of retirement? Sitting on a beach sipping cocktails? Leisurely afternoon rounds of golf? Spending hours playing with grandchildren? Well, for a lot of Americans, that retirement dream may turn into a nightmare. Instead of reclining poolside, they may find themselves greeting customers at Walmart. According to data recently released by Northwestern Mutual, […]

READ MORE →

The Chinese Dumped Billions in US Treasuries in March

china flagLast month, we reported the Chinese had an ace up their sleeve they could play in an escalating trade war with the United States. They could start dumping US Treasuries. Well, guess what? China sold $2.5 billion of Treasuries in March. Related

READ MORE →

One thought on “The War on Cash: Bye-Bye 500-Euro Note

  1. IMissLiberty says:

    I don’t like being punished for the sins of others. That’s why I’m a Libertarian: I have confidence that we, as individuals, can do better than the-powers-that-be. Taken at face value, they’re saying they want to punish good people along with the bad because somebody might use cash illegally–it would make more sense to make drug sales legal and sue those who do harm with them–less illegality and less crime. By their logic, all denominations in all currencies should be abandoned. But, I tend to agree that this is not about crimes committed by bank depositors. A one-dollar bill is only worth a penny or two (less, really), already, and the collapse was set up in 1913. End the Fed.

Leave a Reply

Your email address will not be published. Required fields are marked *

Call Now