DO not know if this is a global thing. I don’t know if that’s true only for this country or for this city. I can speak about my own area, and only my own area, for now… (based firsthand and direct experience)

When banks started to collapse about two weeks ago (about 4 banks so far, mostly in the US) it sort of started a ‘chain reaction’ and the ripples aren’t over yet. It’s a ‘domino effect’ and there’s latency, just like there was a large latency in 2008. It can take weeks or months to fully unfold. Governments intervene. Bailouts become bigger and bigger. It’s impossible to justify these. The public rebels. There’s revolt. What’s left of the media ‘changes side’ to appease angry readers. Journalists would rather not defend the rescue of thieves.

On the very same day it started (SVB, late Friday) we decided to ensure we have physical cash, just in case.

In 2020 when the lockdowns started the media kept mentioning that toilet paper was running out (of stock, at least in store). Such media reports initiated growing levels of unrest/panic. It’s a case of self-feeding loops and a self-fulfilling prophecy. It didn’t take long for people to hoard (inside their home) what was left, so stores everywhere had no toilet paper left or only very expensive brands (that fewer people were willing or capable of buying).

It seems safe to assume that right about now the maintream media would cooperate with the state to prevent runs on the banks or runs on ATMs (“cash machines” here). It’s not easy to even withdraw large amounts from one’s account in the high street branches (many branches have also shut down and repeatedly pressure people to use “apps”, i.e. do all the work for themselves). They added barriers.

Yesterday, for the first time ever, we received marketing spam/mail in the post (‘snail mail’) from a company asking if we wish to sell our home with their help. That’s rather strange if not a rude thing to be asking. One day earlier I stumbled upon an article stating that home sales have generally plunged (or people wishing to sell cannot find a buyer… not for the desired price anyway).

So one can generally see where the economy is heading…

A week ago I read that in Russia, more so after the war, many Russians hoarded physical cash. They could not trust the banking system, so they probably just wished to diversify their holdings as a failsafe mechanism (not putting all eggs in one basket). With sanctions and all, who can blame them?

I assume the media here won’t report the ATM situation, but this is a personal blog. I’ve long assumed that changing all the banknotes and coins (several years ago at relatively short notice) was about invalidating old ones to reduce the money in circulation, making it harder for people to pay with cash or even find cash (ATMs are not so easy to find anymore and those that exist are barely or poorly maintained/attended).

So here is my experience.

With the collapse of SVB I started taking money out every day or every other day. I always took it out from the ATM nearest to me. This was OK for just over a week. Then, at the start of this week, the machine ran out of 10 pound notes, so it could only dispense ’20s’ (twenties, 20 pounds). It wasn’t going to last so long and it seemed improbable they would restock it. Today, or maybe a bit earlier, the machine was already “temporarily out of order” (which means it ran out of cash; it only deals with tens and twenties). As a result I went to other machines near to me. I found 3 more of them, but 2 of them had already run out of 10 pound notes. It won’t be long until they run out of notes and basically become “out of order”. Then, the fourth machine would bear the brunt of those other 3 machines (nearest to us) not dispensing cash to people desperate to obtain some. It too would run out of cash. And fast. Maybe by tomorrow all those 4 machines (nearest to us) would have no cash left in them. Is there a plan to replenish? Maybe the government does not even want to.

And the financial crisis isn’t even over yet. It’s still young. Business transactions have been slow lately, there are many layoffs (today it’s Microsoft again), and small businesses struggle to raise funds. Some won’t be able to process payroll and issue salaries this month. They will go out of business. Nobody will come to work.

The media is trying to pacify people and one must be “ahead of the game” to react early enough; by the time the issues become widely recognised it’s already “too late” to respond to them.

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This entry was posted on Wednesday, March 22nd, 2023 at 11:31 am and is filed under Personal. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.