Cashless Societies: How Realistic?
By Daily Bell Staff - December 28, 2015

In Sweden, a Cash-Free Future Nears … Parishioners text tithes to their churches. Homeless street vendors carry mobile credit-card readers. Even the Abba Museum, despite being a shrine to the 1970s pop group that wrote "Money, Money, Money," considers cash so last-century that it does not accept bills and coins. Few places are tilting toward a cashless future as quickly as Sweden, which has become hooked on the convenience of paying by app and plastic. – New York Times

Dominant Social Theme: Remove analog money ASAP.

Free-Market Analysis: Sweden is being touted as the wave of the future as regards money, but perhaps not.

When something is profiled in The New York Times, as the "new" cashless Sweden just was, we need to consider whether the trend is subject to change or is not so powerful as we are being led to believe.

One of the problems with seeing Sweden as a pioneer is that its population is fairly cohesive. In fact, Swedes constitute a good example of the tribes we often refer to in Europe. Europe is full of tribes. The French are notoriously tribal and it strikes us that the British fought two world wars to shatter Germanic tribal unity.

Years ago, we reported regularly on what would happen when "Europe" stopped being of benefit to the tribes. Because it has been disguised by rhetoric, people often don't understand why the tribes gave up so much including their ancient currencies to join Europe.

In fact, they were often bribed by pots of EU money that poured into the government to adjust unallowable deficits. The top elites pocketed this money and then went to work campaigning for EU unity. Once the EU agenda triumphed, those in power slipped away with the money and the larger population was stuck with an evolving authoritarian empire.

It was inevitable that the tribes, once lulled by good times and cash infusions, would begin to resent an era of "austerity" and impoverishment. What we didn't anticipate was that the European elites had an answer: Organize a mass Islamic migration (apparently this is what's going on) that would cause confusion within Europe's tribal countries and focus resentment away from Brussels and the monetary system and toward "Islamification."

It is true we didn't anticipate this breathtaking attempt at cultural reshaping but otherwise events are unfolding much as we expected. Sweden, though the Times article doesn't note it, is reacting much as we anticipated. While the Swedish intelligentsia has portrayed itself as shocked and dismayed, the "far right" has made enormous political strides in the country. Anti-immigration forces now reportedly support the country's third largest party.

The Times predictably ignores the political trends, however. It burbles on about Sweden's "tech forwardness" and the "personal safety" that a cashless society offers.

This tech-forward country, home to the music streaming service Spotify and the maker of the Candy Crush mobile games, has been lured by the innovations that make digital payments easier. It is also a practical matter, as many of the country's banks no longer accept or dispense cash. At the Abba Museum, "we don't want to be behind the times by taking cash while cash is dying out," said Bjorn Ulvaeus, a former Abba member …

Advocates like Mr. Ulvaeus cite personal safety as a reason that countries should go cash-free. He switched to using only card and electronic payments after his son's Stockholm apartment was burglarized twice several years ago. "There was such a feeling of insecurity," said Mr. Ulvaeus, who carries no cash at all. "It made me think: What would happen if this was a cashless society, and the robbers couldn't sell what they stole?"

Of course, this is hard to fathom. Ulvaeus may feel safer in his apartment but someday hackers may clean out his bank account or hijack one of his credit cards. Physical crime may drop even as cybercrime rises.

For some critics of the "cashless society," the reasons it is evolving are considerably more mundane than "progress" or "technology." It is the lower bound that is stiffening determination. As financial institutions are increasingly forced toward the "zero bound" by the failure of monopoly central banking, less-than-zero rates are being contemplated. And what's stopping the program is cash.

If you have the choice between storing your money at a bank – and losing a chunk of it every month to negative rates – and keeping your funds in cash … well, cash is bound to win. It's the reason Citibank's chief economist not so long ago called for a "ban" on cash.

Glenn Beck has been journeying in Sweden and through a third party is providing updates on his travels. A recent report contained the following information:

Glenn said Sweden is now at a tipping point where the Swedish people will be the minority within the next 10-12 years. "They're currently being taught that there is no Swedish culture — that's what they're teaching their students — there is no inherent Swedish culture," Glenn said … People are begging their governments, saying, "You don't understand, fascism is coming because you won't listen to the people."

This is exactly the point. One can speculate, as we have, that the social chaos and resultant authoritarian political movements are exactly what those in real power desire and expect. But such an evolution does not necessarily bode well for an evolving cashless society.

This is what the Times article misses. Restrict our observations to Sweden and we can surely suggest that if the political climate continues to fracture the current Swedish consensus, many Swedes may rethink their enthusiasm for government/corporate control over digital money.

In fact, while we don't expect Times writers to understand this, basic economics may cause the cashless society to founder. If one accepts that the zero-bound is a big reason for digital commerce, then people will gravitate toward cash simply to avoid negative interest rates.

No matter what proponents of the cashless society mandate, competition between negative interest rates and neutral physical currency (and perhaps precious metals) will make sustaining such a system difficult.

But even if such a society avoids negative rates, it is very likely that there will continue to be a significant demand for cash. With little restraining it from hiking taxes and passing more onerous legislation, governments will gradually make gray and black market activities more attractive.

People such as those that read publications like The Daily Bell will be the first to adopt private solutions that combat government invasiveness. It is inevitable.

After Thoughts

In other words, be careful what you wish for.

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  • Bruce C.

    The irony is that cash is going to be needed for the “migrants.” It’s not like they’re going to get jobs and set up automatic deposits of their paychecks. Here in sunny South Florida cash is essential for keeping houses clean, kids taken care of, and lawns (and toes and fingers) manicured. Money laundering through the construction industry is a boon too. And what about future politicians who need to hide compensation, like the EU “elites” do?

    • dave jr

      Maybe organized crime moved through the higher echelons of construction some time ago, I think they have moved on to more profitable things. That being said, I don’t deny that learned predators have been left in the wake. Being a servant to the construction industry in Michigan, I can say a 20 million dollar capital outlay, an iron gut for uncertainty, and an ability to sustain months and sometimes years of unprofitability is the qualification to play my game. Boon or no boon, it is still hard work where price, reliability, safety and excellence in performance that gets the job; as it should be.

      • Bruce C.

        Yeah, I was just trying to cite various situations where cash is used – sort of tongue in cheek – but used by both customers and businesses.

        The more I thought about this though the more examples I came up with.

        Cash is also an easy way to subvert things even more by issuing it (unbacked) to the “masses”. Since only about 1-2% of transactions are in cash and at least half of those are “grey” market, it would be hard to detect at first, and it would create both price inflation and more government dependency. It’s nauseating.

  • PatrickHenry1789

    ” At the Abba Museum, “we don’t want to be behind the times by taking cash while cash is dying out,” said Bjorn Ulvaeus, a former Abba member …”

    Where in the world did the NY Slimes dig this guy up from? They’ve been irrelevant for so long that I thought they were dead.

    • Bruce C.

      It could be that out of all the pop-culturalists they interviewed he was the only one who liked the idea.

  • Danny B

    Dear Bell, I found an excellent article that IS related to today’s edition here. It takes some time to digest.
    ““Capitalism,” says Saviano, “needs the criminal syndicates and criminal
    markets… This is the most difficult thing to communicate. People – even
    people observing organised crime – tend to overlook this, insisting upon
    a separation between the black market and the legal market. It’s the
    mentality that leads people in Europe and the USA to think of a mafioso
    who goes to jail as a mobster, a gangster. But he’s not, he’s a
    businessman, and his business, the black market, has become the biggest
    market in the world.””
    ” Narco cartels like Guzman’s are not adversaries of global capitalism,
    nor even pastiches of it; they are integral to – and pioneers of – the
    free market. They are its role model.”
    “Here it is, the lie of any dividing line between legal and illegal. Here
    it is, laid bare: cartel as corporation, corporation as cartel; cocaine
    as pure capitalism, capitalism as cocaine, known in its purest form as
    zero-zero-zero – a wry reference to the name of the best grade of flour,
    ideal for pasta.”

    “For some reason, he says, the Anglo-Saxon world is slower to understand
    the innate criminality of the “legal” system than Latin societies. “I
    think the Anglo-Saxon, Anglo-American world is infused by a kind of
    Calvinist positivism; people want to believe in the health of their
    society,” says Saviano, even though “what this all means is that, for
    instance, the City of London is a far more important centre for
    laundering criminal money than the Cayman Islands”.”

  • esqualido

    The Times also studiously avoids talking about Germany, with a vibrant economy, where cash is king, and the use of plastic avoided. Having to actually come up with the money when you want to buy something does reinforce thrifty habits, but this is not in the interest of the bankers taking out full page ads.

  • Me Again

    Interesting. Sweden may even be the first EU country to implode under the weight of PC guff that is wallowing around in it. The rape capital of the world bar one piece of Lesotho in south Africa. Sweden has surged to the top of the European rape leagues by the clever introduction of hundreds of thousands of men who do not believe that women -unless Muslim- have the right to even speak let alone say no to gang rape. After all, because they wear clothes instead of bin liners, they are of course asking for such manly treatment -clearly.
    I think one of the big mistakes the media make [or deliberately ply] is to assume that people who want to retain their culture and country, people who don’t feel obligated to take in thousands and tens of thousands of ‘chancers’ from alien cultures, people who value their women and see them as equals are not actually right wing. They are in fact displaying large amounts of common sense.
    This commonsense stuff is an alien substance as far as the power elites and general government are concerned and probably would be a class A drug if they could work out where it comes from.

    I recently read that eight Swedish men raped a woman on the ferry across to Kalinin. Looking closer into this you find that actually non of them were Swedish citizens, seven were Somali and one was Turkish, all were asylum seekers of some kind. When the paper was asked why they published an article which wasn’t in the least factual regarding the origin of these men the paper would not accept they’d misled anyone.
    The thought police -gestapo branch- operate in all levels of Swedish life and even MPs can be arrested and charged with hate crimes if they suggest that part of the problem -just part of it- stems from non integrated immigration.

    How did the noble Norseman sink so low?

  • Ernie Hopkins

    Excellent article!!!! US private economic activity today is VERY cash oriented. Kill it and kill the last vestiges of survival for the former middle class. The banksters love this idea as it gives them supreme power over everyone’s daily bread. They can now siphon to their hearts content. Their lap dogs in the political process will go along as long as they keep getting unlimited spending.

  • dave jr

    Whether money is digital (cashless) or analog (physical) is beside the point. If a free market developed ‘cashless’ transactions because of efficiency and reliability, then so be it. The nexus of contagion is the fact that the definition of money has been taken away from free market proponents (those invested in blood, sweat and tears) through democratic and liberal authoritarian force du jour, cooked up by deceptive monopolist interests. Every time the authoritarian approach defaults, which it does regularly because it is not a source of wealth; ‘they’ need to have more regulation written, to make business, finance and investment more complicated than need be, to stay ahead of the curve, to keep up a deception as a shield to conceal corruption from up ‘high’. The issue is not what form of ‘money’ is accepted, it is the fact that the form being used is coerced, as all other options have intentionally been cut off; the default form is supported because it allows for greater opportunity of corrupt practices. Corruption and widespread ignorance of it, then is the main issue. So who is to blame? Is it deceptive authoritarian backed monopolistic cabal(s)? Or is it the blind and unaware sheople? That question is not pondered because the corruptors wisely use the first proceeds of monetary hi-jacking to contribute to MSM, education and scientific outlets, so as to write fractured policies and fund dividing cultural distractions, in order to maintain control. And when it plays out (the sheople, after one hundred years, can only support so much), it is designed to crash and burn where a new high tech paradigm is rolled out. Will the remaining sheople run to it? Probably. Oh well. Such is the wonderment, amazement and awe of life on this earth.

  • Praetor

    Want to destroy the ‘NWO’ go cashless! Cashless societies rely on electricity to function. So called immigrants and the poor rely on cash to live, a billion Chinese poor will tell you cash is king. Take their cash and see what happens. Maybe the reason the ‘bricks’ want their own bank, so as to continue to issue paper money. In colonial America there were hundreds of different currencies, beaver fur, wampum, tobacco, hemp, and then there were the foreign money (coins) used as a money ‘exchange’ medium or what ever individuals agreed to exchange for value. In other words everything is money ‘currency’ and everything can be used as money ‘currency’. If the NWO wants a cashless society, than there be no need for the NWO, because they were the ones who gave us fiat money in the first place. No more money, no more need of ‘them’. Gresham’s Law, bad money pushes out good money, problem for the NWO, people start using good money and stop using the bad money, and the control they seek is lost. Yep life will be different with out cash. We all give these fools to much credit. Getting control and maintaining control are to separate issues. The zombie fearful sheep will be the ones to parish. Natural Law and Human Action in a real Free Market will begin to function again. Go head ban cash!!!

    • 45clive

      There is no rule that says digital money is not fiat money. Indeed, all fiat money starts out as digital…the paper is the evidence. Get rid of the evidence and how can you prove you own any digital money? As the war on drugs winds down, perhaps a war on money will emerge. Police break into your house with a warrant looking for money and finding none when they search, notice a purse containing money on your coffee table or under your mattress just before they leave.

      • lulu

        I was thinking something similar myself.

  • Len Mullen

    I have spent more cash in the last eight months than I did in the last eight years. Everyone from Ford Motor Company to the guy who paved my driveway to my local grocer to the least expensive gas station in my state all offer steep discounts for cash customers. Given the rash of data breaches, I am reluctant to hand a credit card or even my license to one off vendors. Once again, cash is king!

  • Demonocracy

    Also, the Bill and Melinda Gates Foundation is teaming up with the World Bank and the Better Than Cash Alliance group to facilitate this worldwide control of everything you do. Everyone will be taxed at the source and taxes will not go down. This is digital electronic surveillance and enslavement even if it doesn’t mean getting a microchip.

  • Steven

    It is highly likely that white and blue collar crime will persist and even grow in multi ethnic and cashless societies. The social and economic order hs been disrupted by the revolutionary elitists who fear living and operating in all white nations that traditionally use physical cash both paper and coin. There are consequences for going against what is normal and natural.