Home-safe sales are surging in Germany as savers seek a safe place to hold cash instead of at a bank that pays a tiny interest rate, according to a report in The Wall Street Journal.
"It doesn’t pay to keep money in the bank, and on top of that you’re being taxed on it,” Uwe Wiese, an 82-year-old pensioner who bought a home safe to stash $59,344, told the newspaper.
The European Central Bank has pushed interest rates into negative territory to discourage financial institutions from letting money sit idle. The policy is intended to push commercial banks to pump money into the economy to boost spending and borrowing.
Burg-Waechter KG, Germany’s biggest safe manufacturer, told that newspaper that sales jumped 25 percent from a year earlier, while competitors Format Tresorbau GmbH and Hartmann Tresore AG also saw big increases.
The ECB’s negative interest rate policy mostly affects financial institutions, but individuals with big accounts at one small Germany bank are now paying for the privilege of having their money stored in a vault.
Raiffeisenbank Gmund, a small cooperative bank in the Bavarian town of Gmund, today started charging customers 0.4 percent on deposits greater than 100,000 euros.
“Germany’s love of cash is driven largely by its anonymity,” according to the WSJ. “One legacy of the Nazis and East Germany’s Stasi secret police is a fear of government snooping, and many Germans are spooked by proposals of banning cash transactions that exceed €5,000. Many Germans think the ECB’s plan to phase out the €500 bill is only the beginning of getting rid of cash altogether.”
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