Thursday, July 2, 2009

Negative Interest Rates on Bank Deposits in Sweden

Finally, the stupidity and bizarre nature of a fiat currency system is being laid out in obvious detail and easy to understand terms thanks to Sweden's central bank. This is big, big news for holders of Gold. Sweden's central banksters announced a 0.25% repo rate but a -0.25% (that's negative 0.25%) interest rate on bank deposits. In other words, member banks will now have to pay the central bank to store their money in Sweden.

This is what both Gold bugs and Ben Bernanke have been screaming about since this crisis began. With a fiat system, a "determined" central banksta can always create inflation, or so the story goes. And in a way, it is theoretically true. If the US government decided to pass out $1 million to each of its citizens tomorrow, you can bet that some inflation would be created.

If such a policy change were transmitted to individuals, a run on the bank would occur. This comes on the heels of the Japanese banskstas thinking about banning paper money and forcing people to get on a digital-only monetary system. These are the potential end-game type moves that will not only send Gold to the stratosphere, but will finally make a critical mass number of people wake up and begin to question the ultimate bezzle.

Such policies also open the door to re-instating Gold confiscation and/or harsh penalties/taxes for buying and/or selling Gold (i.e. worse than the current obscene and unfair capital gains tax on Gold). Just in case any apparatchiks are reading this, I have already given my Gold away to the poor - I swear!

This is a strong central banksta salvo to force inflation and/or tells you how much risk is truly out there when a central bank doesn't want its member banks depositing money. It may or may not work to force inflation but it's very bullish for Gold and very bullish for waking up a few more members of the public from their stupor. It's also very bearish for banking system stability and very bearish for trust in the government.

Even if you believe (like I do) that deflation will trump inflation for at least another year, buy Gold and sleep well. As someone determined to spread the word about the true causes of our current economic crisis, this is a major step towards shining light into a very dark hole of deceit. Paper is only as reliable as the people backing it and those people aren't 1/100th as reliable as a shiny piece of yellow metal.

EDIT: Post has been altered since original posting due to the nature of the negative interest rate being charged to banks - I misunderstood the press release when I first read it. My apologies for the error.

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