When central banks like the European Central Bank (ECB), Bank of Japan (BOJ), and the sovereign one in Switzerland entered into the vast unknown of negative interest rates earlier this year, the primary purpose behind it was to encourage banks to both borrow themselves, and lend out that money in the attempt to grow the economy through the stimulation of business and consumer spending.
However, this move has resulted in an adverse and even opposite affect to what the central banks desired when they chose to implement this policy. And as we saw beginning in January when investors, pension funds, and even hedge fund managers summarily fled the bond markets and began buying both paper and physical gold, the results of NIRP have completely invalidated all fundamentals in asset pricing, and have led even the wealthiest to ditch the markets out of fear of a coming collapse.
Interestingly, if the effects of negative interest rates had remained only within the banking and market mechanisms, people as a whole may have simply continued to act in accordance to the way they always have, since most of the 99% have little to do with stocks, bonds, and real estate eight years after the Credit Crisis and taxpayer funded bailouts. But on Aug. 12, an announcement out of Germany is changing the game entirely for those who still hold money in a savings or checking account.
That is because beginning in September, the first commercial bank will begin charging a fee which will effect any bank account holder who has €100,000 in a savings, checking, or business account.
The significance of this is that charging account holders fees simply for holding their money in the financial institution is both a recipe for an immediate run on that bank, and the potential for individuals with less money in their own accounts to soon be charged this fee as well sometime in the future.
For years members of the alternative media have been warning that holding your money in a bank is a potential for disaster, and for a complete loss of your wealth if governments or central banks choose to devalue it, confiscate it through a bail-in, or usher in capital controls like those we are seeing now in Greece. And the days where one can move their wealth into alternative and protected forms of money such as gold, silver, and bitcoin are quickly coming to an end because when the next global financial crisis hits, the powers that be will not give individuals even a moments notice to be able to move their money to safe havens outside of one of their already established bail-in platforms.