Every now and then I will click on a link and find myself on Alex Jones’ website inforwars.com. I regard Alex Jones as so far to the right as to be an unreliable source of information. And so it was that when I found myself there today, I started to leave as quickly as I had arrived. But then I figured it wouldn’t hurt just to look. The article reports that JPMorgan Chase is sending out letters to those who have safe deposit boxes with that institution that they will no longer be allowed to keep cash or gold coins with no numismatic value in the box.
To explain why this troubles me, I must begin at the beginning. Back in the early 1990s, when gold was selling for around $350 an ounce, I began buying gold coins on a regular basis, and I continued to do so for the rest of the decade. At first, I just threw the coins in a jar. I used to love pulling them out from time to time to play with them. It reminded me of when I was five years old. Back then, if my father had a few pennies in his pocket at the end of the day, he would give them to me, and I would throw them in a jar too. And back then, I would pull them out and play with them. I could have used them to buy candy or a toy, but I never gave in to that temptation. As a result, I soon had about two dollars’ worth of pennies. Adjusted for inflation (this was 1951), my wealth was the equivalent of just over eighteen dollars today, not a bad hoard for a five-year-old child.
In other words, there is something special about making physical contact with one’s wealth. I have a lot of investments in the stock market, as well as cash in the bank, but there is something exhilarating about spreading coins out on the bed, be they pennies or Krugerrands, and picking them and dropping them back down. It is the difference between knowing you have a girlfriend and actually holding her in your arms. Needless to say, my favorite cartoon character as a child was Scrooge McDuck. I always understood the sensuous pleasure he must have felt as he swam around in his warehouse full of coins and currency.
After the turn of the century, gold started going up in price, and suddenly my jar full of coins was becoming too valuable to keep at home. So, with sadness in my heart, I took them to the bank and placed them in my safe deposit box, where they remain to this day. As to whether I shall be able to continue keeping the coins there remains to be seen. In any event, I still have cash that I can get physical with. At least, so I thought at first.
I have never used an ATM. I just go to the bank every two or three months, pull out two or three thousand dollars, take it home, and put it in a drawer. And I make a habit of keeping about four hundred dollars in my wallet. It makes me feel secure. There is nothing like a little ready cash to smooth out the rough edges of one’s life. I have a friend whose son was arrested for assault while she and her husband were out for the evening. When they got home, she got a call from the jail, and her son said it would cost a thousand dollars to bail him out. “Well,” she said, “we didn’t have a thousand dollars lying around, and they would not accept a check or credit card, so we told him we would be there in the morning.” By the next morning, the detective had scared her son so much that he signed a confession, making him a felon, even though it was a rap he could probably have beaten had he waited until he had a lawyer to defend him. And so, for want of a thousand dollars, her son now has a criminal record. I have never had anything happen to me in my life to compete with that, but on a smaller scale, I have often used to cash to get out of trouble as fast as I got into it.
And then there is the aesthetics of paying with cash. Although the series Mad Men no longer has the pizzazz it did in the first few seasons, I always loved the way Don Draper would pull out his fat money clip and start peeling off bills until he got what he wanted. And he never asked for change. Roger Sterling did not have a money clip, but he would pull out a big roll of bills for the same purpose and to the same effect. The aesthetics are different for a tough guy in a film noir. A tough guy, be he a gangster or a private detective, never uses a wallet or a money clip, nor does he keep his money in a roll. He just reaches into his pocket and pulls out a bunch of rumpled bills, carelessly tossing them on the table. Paying cash is manly, however you do it. Now, I read Don Quixote, and so I know the folly of trying to be like the characters I see in the movies, because I would just end up looking ridiculous. But I figure as long as I don’t go overboard, paying cash might let me get a little of that Mad Men or tough guy aura.
There are downsides to carrying a lot of cash, of course. For years I went dancing on a regular basis with a variety of dancing partners, and with each one it was on a Dutch treat basis. When there was a cover charge at a night club, being a gentleman, I always let the lady pay first. Then I would pull out my wallet. Because my bills were never in regular order, I would have to take the whole wad out so that I could sort through the bills to find the exact amount. All the while, my dancing partner would be standing there, arms folded and with a look of irritation on her face. It just ruined the whole Don Draper effect.
By this point, you may be wondering what this has to do with the safe deposit box restrictions. After all, I keep the cash in the drawer at home, not in a box at the bank. However, that same article referred to an earlier article, which reports that the Justice Department is ordering bank employees to consider calling law-enforcement authorities if a customer withdraws $5,000 or more from the bank, which could lead to a seizure of assets. Now, my first thought was that I could stay safe by withdrawing less than that amount. But then it occurred to me that they might accuse me of a new form of structuring.
Most of you have probably heard of this, but over twenty years ago, I learned that if you deposit or transfer more than $10,000, the bank must notify the authorities. As a result, some people will deposit or transfer amounts less than that number, so as to avoid such notification, which is called “structuring.” There was a case of a doctor who wanted to transfer $100,000 from a bank in one state to another bank in another state. On the advice of his accountant, who warned him that transferring all the money at once might precipitate an audit, he transferred the money on different days, in amounts of $9,500. He was accused of structuring, and the government took the whole $100,000, even though there was nothing illegal about the way he had earned that money. I read that story over twenty years ago, and ever since then, if I had a large sum to transfer, I made sure that it was at least $10,000 so as to avoid the charge of structuring. I’d rather be audited than robbed. And what they regularly do with deposits and transfers, I fear the Justice Department may do with withdrawals. If I routinely withdraw large amounts of cash, but less than $5,000, they may accuse me of structuring and take it all.
I have my safe deposit box with a local bank, not with JPMorgan, and I have not received any notification restricting me about the contents of that box. But if I do get such a notice, I guess I will have to sell my gold, because it would be too dangerous to keep at home. As for cash, I guess I will have to learn how to use an ATM, withdrawing amounts of a hundred dollars at a time, on a more frequent basis. And I guess I will have to get one of those iPhones or whatever, so that I can pay electronically.
Like Scrooge McDuck with a debit card, it just won’t be the same.