A matter of Trust and No Interest

The latest bankster grab is a negative interest rate on savings above 250,000 euro (Coming soon to a town near you, whilst you laugh at the rich caught in the maws of the bank, remember, this is but the start –  the entry barrier shall be lowered to include you shortly).

A negative interest rate is when you pay the banks to store your money. The rich are an easy target for broke Governments and a worthwhile source of time spent. After all, you don’t rob poor people and expect to get a worthwhile return.

Watch for a rise in Bitcoin, gold and other untraceable stores of value as the rich seek to retain their wealth. Watch too for a financial war as capital takes flight to safe havens that pay interest instead of charging storage fees. Countries offering such havens will face a double edged sword as they are annexed by the big powers of Europe and the United States (FATCA for Europe anyone?) and the influx of capital looking for an investment.

A rise in well funded criminal enterprises is a certainty as the wealthy seek to keep themselves off the radar by investing in the cash economy.

With a desire to retain and grow wealth will come opportunity for places that are currently off the radar but not tax hungry.

The value of a handshake will return as reputation becomes everything. This is the Asian system of ‘Face’ that Asians rely upon throughout a life that pays scant attention to Government rules, tax and paperwork. The Chinese version of Western Union uses this brilliantly – Want to send $500 to Uncle overseas? – head for the nearest Chinese restaurant, hand over the $ and a fee, call Uncle and tell him to collect at his nearest Chinese restaurant. Done, no paperwork, untraceable, all done on trust.

Interesting times ahead as those we trusted pay no interest and our new allies require complete trust to have interest.