What they didn't expect or intend was that it would cause a run on safes. In a WSJ piece, excerpted here, we read:
Signs are emerging of higher demand for safes—a place where the interest rate on cash is always zero, no matter what the central bank does. Cash languishing in safes could thwart the Bank of Japan’s move to get money circulating more vigorously in the economy.The banks of Sealy or Liberty, may not pay any interest but once the cost of the safe is justified, the money doesn't evaporate.
Shimachu Co., which operates a chain of stores selling hardware and home products, said Monday that sales of safes in the week that ended Sunday were 2½ times higher than in the same period a year earlier.
One safe that costs about $700 is now out of stock and won’t be available for a month, the chain said.
“I am a bit worried about what will happen next,” said Kazuo Matsumoto, a customer at one of the Shimachu stores in Tokyo. While he didn’t buy a safe, the 64-year-old said he might turn some of his cash into gold and keep it inside a safe-deposit box he rents.
As an aside, Japan is a genuine economic mess. We learn that Japanese pensions are so low that retirees are turning to crime to stay alive. If they steal a sandwich and get away, they get a sandwich; if they get caught, they get two years in prison, "three hots and a cot" (at a cost of Y8.4 Million to the state) - no mention if they get to save their pension while they're in jail. As always, it's blamed on everyone and everything, but the fact is that despite efforts of the Bank of Japan for more than 25 years to stimulate the economy, it doesn't work. Despite efforts to encourage spending, people are saving more. This doesn't surprise me a bit, although I'm sure it's an unintended consequence to the Bank of Japan, because as I wrote here last June:
As Jim Rickards put it: "As a result, many citizens are saving even more from retirement checks and paychecks to make up for the lack of a market interest rate. So a Fed manipulation designed to discourage savings actually increases savings, on a precautionary basis, to make up for lost interest. This is a behavioral response not taught in textbooks or included in models used by the Fed."I'm not saying that as a bunch of gun owners we probably already have a perfectly usable safe, and are therefore one step ahead of everyone else when interest rates here go negative, but I'm not NOT saying it either.
When I read this statement "the tax will discourage savings the way all taxes disincentivize whatever is being taxed" something became perfectly clear to me. The income tax is a tax on work.
ReplyDeleteTerry
Fla.
When they claim they want you to spend more money, remind them of the sales taxes; which is a tax on spending money!
DeleteWhich is why the flat tax is a bad idea and I hate to say it, abuses low income people more than those who are in a higher bracket. Low income people by definition spend most of their income on food, housing and necessities, thus are punished more than someone who has the breathing room to decide not to spend their extra money.
DeleteFor pure extraction of taxes from the population, the .gov has devised an ingenious plan wherein the majority of the population doesn't pay attention to the amount being taken from their paycheck and I bet most don't realize a similar amount is being extorted from their employer, which ultimately is an amount that could be used to further compensate the employee for their time. It's all very slick due to the "out of sight out of mind" nature of it all...
And make certain your safe is 'properly' installed! This means bolted to the foundation and the studs.
ReplyDeleteI's an 800 pound Fort Knox that went missing because I thought the weight was enough!
:-(
gfa
And make certain your safe is 'properly' installed! This means bolted to the foundation and the studs.
ReplyDeleteI's an 800 pound Fort Knox that went missing because I thought the weight was enough!
:-(
gfa
Ever seen those circular saw blades that will cut steel? I've seen a pic of a safe that a guy did really good job of installing that was cut open with one of those.
DeleteIt wasn't just bolted to the floors, he built walls around it so that there'd be no way to tilt it and get a dolly under it. The bad guys cut it open with a circular saw and took what they wanted.
"Ever seen those circular saw blades that will cut steel?" I've USED them to cut steel, albeit on a radial-arm saw. I'm not sure I'd want to even attempt to cut steel with one on a hand-held saw, especially the kind of plunge cut getting into a built-in safe would likely require. I'd just use an angle grinder with an abrasive cut-off disc. Which brings up the point that, given enough time and enough tools, ANYTHING that isn't actively defended can be gotten into, another reason that anon @ 4/9 1119a is right (as, sadly, is anon @ 4/10 401a). One more is that the decoy / hide approach will be much more effective against the kind of criminals which will become, if present trends continue, even more of a threat than the ordinary ones - the criminals with permits, i.e. badges. And that reminds me - as does the other topic of your OP - of an account I once read of an interview with Ludwig von Mises, late in his life, wherein, after a somewhat extended discourse on the inevitable bad consequences of the nearly universally held bad ideas he opposed, was asked, in effect: "So what's your personal strategy for dealing with all this?" His answer was one word: "Age." I'm really beginning to understand how he felt.
DeleteExcellent and important point! Safes are rated by how much they slow down attempts to break them. Given enough time, anything can be broken into, and there is, sadly (as you say) anon 1119's idea of what the criminals who break in would do. The XKCD cartoon on breaking an encrypted password comes to mind ("Give him $5 worth of drugs and beat him with this wrench until he gives it up").
DeleteHere's the problem. Some safes are really good and some, like cheap gun safes, are not adequate. BUT the bad guy simply has to hold your family hostage and cut off your child's fingers one by one to get into the best safe made. A safe, IMHO is a mistake. Or better yet have a cheapo safe put a few things of value in it and if a bad guy breaks in he will take the crap and leave. Hide your money where no one will look for it.
ReplyDeleteHere is a suggestion for something I used. In my kitchen there are corners where the lower cabinets don't butt up against the wall. Picture two cabinets pushed against a corner from both sides. But if the side that is blocked by one of those cabinets extends all the way back to the wall it is lost space. You can't reach it easily and you can't see into it easily. So the installers pull that blind cabinet out from the wall 6-8 inches. When finished you don't even notice it. That blind area is till there just smaller and slightly easier to get to. But behind the cabinet there is a space about 6" wide, 18" deep and 30" high that is inaccessible and invisible (not to mention hard to get to. But for most people's houses there is a adjoining space; mine was in the laundry room. I could cut a 6"x6" piece of wallboard out and see the wallboard of the kitchen wall 3 1/2" away. Cut that out with a 6"x6" hole and you have access to that lost space behind your kitchen cabinet. You can put a gun, precious metals, paper money, whatever in their and repair the outer wall and it is safe (unless your house burns down). It's not simple to get into it on a regular basis so it is intended for hiding something not for a piggy bank or temp storage.
Really good stuff, anon. You can enlarge that idea and find all sorts of places in a house to store things that you want well hidden.
DeleteAnyone who would cut off a child's fingers will go on to kill all of you as witnesses after he gets into the safe. There is no win from complying because you can't trust him to keep his bargains.
DeleteSome of us have already anticipated negative interest rates - along with other reasons for keeping cash and precious metals. I'll make an easy prediction: when the government decides it _still_ isn't getting enough (or controlling enough) of your income, it will make cash either worthless or illegal. They will force everyone who doesn't participate in the "underground economy" (there is a better term, but I can't recall it) to have all their monetary assets in electronic form by making cash unacceptable for any transactions.
ReplyDeleteThey started it with government employees (like us nurses at the VA) by stopping the issuance of paper paychecks, and forcing us to use direct deposit. Also, they have already begun the process of legislating the "nationalization" our IRA/401k accounts, forcing all but very high-end investors to use government accounts for all investments and retirement modalities. (WSJ: They Want Your IRA http://www.wsj.com/articles/they-want-your-ira-1459985170)
Terry's comment above reiterates why people in this country haven't had a hemp-party on the boulevard leading to the washington monument with lampposts and the higher treebranches playing a key role... people have forgotten that money is a denomination/storehouse of their work - ie someone pays you a certain amount of dollars in exhange for an hour of your life. Taxes represent the theft of some portion of your life and labor. That's the no-shi# truth.
ReplyDeleteAbsolutely. I think people are so conditioned to pay taxes that the vast majority is incapable of seeing it that way.
DeleteI was talking with a 40-something guy the other day. When I suggested that, he said something like, "taxes are for the government to take care of poor people". It was just a given to him.
Boy, do they have that guy indoctrinated, or what....
Delete