Don't look to bent regimes like the UK's to sort out the problems. The Iceland option is favourite but any solution that doesn't come from the banks or their governments is to be applauded.
Zero Hedge carried this
More and More Outlets Are Suggesting a Carry Tax on Physical Cash
Submitted by Phoenix Capital Research on 05/28/2015 13:26 -0400
A carry tax… or tax on physical currency… is coming.
The Fed and other Central Banks literally took the nuclear option in dealing with the 2008 bust. Collectively, they’ve printed over $11 trillion and have cut interest rates to zero for nearly six years.
All of these efforts were focused on driving in trashing cash and forcing investors/ depositors into risk assets.
But these policies have failed to generate growth.
Rather than admit they are completely wrong, Central Banks are reverting to more and more extreme measures to destroy cash and force investors to move into risk against their will.
Things went into hyperdrive last June when the ECB cut interest rates to negative, thereby CHARGING depositors to keep their money in cash.
Since that time, Denmark, Switzerland and other nations have followed suit.
The banks are following in their footsteps. Julius Baer, JP Morgan, and other firms have begun to charge large account holders for parking in cash. JP Morgan openly stated it wanted to LOSE $100 billion in deposits.
This is just the beginning. More and more we’re seeing hints that Central banks are planning on charging individuals who sit on cash… or possibly even banning physical cash entirely.
Now comes the interesting part. There are signs of an innovation war over negative interest rates. There’s a surge of creativity around ways to drive interest rates deeper into negative territory, possibly by abolishing cash or making it depreciable…
As long as paper money is available as an alternative for customers who want to withdraw their deposits, there’s a limit to how low central banks can push rates.
The old adage says “you can lead a horse to water, but you cannot make him drink.” The Fed and other Central Bankers lead the horse to the water. The horse wouldn’t drink. So now they’re talking about holding the horse’s head underwater until he does.
Again… a carry tax is coming. The Fed and other Central Banks are going to do everything they can to incinerate cash going forward. In Europe over 40% of sovereign bonds are NEGATIVE in nominal terms (meaning investors are paying to own these bonds).
This is just the beginning.
It sounds like absolute insanity, but we can assure you that Central Banks take these sorts of proposals very seriously. QE sounded completely insane back in 1999 and we’ve already seen three rounds of it amounting to over $3 trillion.
No one would have believed the Fed could get away with printing $3 trillion for QE in 1999, but it has happened already. And given that it has failed to boost consumer spending/ economic growth, we wouldn’t at all surprised to see the Fed float one of the other ideas in the coming months.
Indeed, we've uncovered a secret document outlining how the Fed plans to incinerate savings.
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Phoenix Capital Research