This Is Where I Get Off by Jeff Thomas
We began writing on the War on Cash some time ago, when it was still just a theoretical ploy that we believed banks and governments were likely to employ as their economic adventurism continued to unravel.
But, in the last year, several countries have, as a part of the War on Cash, begun removing larger bank notes from circulation in order to force people to perform all economic transactions through the banking system, ensuring that the banks would gain total control over the movement of money.
Of course, the banks could not admit their true goal to the public. They instead used the governments to claim that the measure was being undertaken to restrict crime (money laundering, drug deals, black marketing, terrorism, etc.).
Recently, without any fanfare, ATMs in Mexico have ceased issuing the 500-peso note (US$24). The largest note is now the 200-peso note (US$10).
At about the same time, Citibank in Australia declared that it will no longer accept coins or banknotes.
India has joined those countries that have done away with larger notes. They did so quite suddenly, and the effects are already being felt by the Indian people. The elimination of the 500-rupee and 1,000-rupee notes has, of course, not limited the level of spending in India, but it has caused a sudden demand for considerably more smaller notes through which to accomplish the same transactions.
A problem with the removal surfaced immediately when people using ATMs were withdrawing far more notes than ever before in order to have enough cash to function normally. The ATMs were quickly being emptied of the smaller denominations. The people of India cried foul, as 86% of all money in circulation had vanished from the system overnight. The limit for withdrawal per day is 2,500 rupees (US$37) – which for some is sufficient to pay for daily expenses, but is most certainly not sufficient to carry on a business or facilitate larger transactions.
Although deliveries of notes to the ATMs has increased, the banks simply cannot make up for the sudden loss of 86% of the nation’s money. Not only can the delivery trucks not meet the demand, the machines cannot store the volume of notes needed.
The result has been a partial breakdown of commerce. With millions of people beginning each day with insufficient funds to function, one byproduct of the money shortage is that over 9.3 million trucks have simply been abandoned by their drivers. (Nearly two-thirds of all freight in India moves by road.)
In January of 2016, we published an article that made reference to the turning point of World War II on the Western Front. Although the German war machine was collapsing, a major last-ditch effort was made at the Battle of the Bulge to reverse the tide of the war. German tanks raced to the battle and might well have made the Germans the victors, but they ran out of gasoline along the way.