In case of emergency, you should always have a solid chunk of cash on hand. These days, that isn’t much riskier than keeping your money in a bank.
There are stories of banks and governments suspending accounts for no legitimate reason. Furthermore, the interest rates at banks hardly give you much incentive to store your money there.
But as with anything that gives individuals more control over their lives, the government doesn’t like it. They want the ultimate control to cut you off from your economic power.
It’s bad enough that inflation robs you of the value of your money.
But Trump’s newest pick for the Federal Reserve board of governors wants to go even further. Marvin Goodfriend thinks there should be a robust negative interest rate placed on cash.
For example, if there was a -10% interest rate on cash, your $10 bill would actually be worth only $9. It is basically a penalty for using cash.
The excuse is that this will stabilize the economy by keeping more capital in the banks. It means banks, and by extension, the Federal Reserve, have more control over your money.
The Federal Reserve controls interest rates. Goodfriend claims that sticking to …read more