Re: Nifty secret bank system
At 06:30 PM 10/3/2001 +0100, CDR Anonymizer wrote:
http://archives.nytimes.com/2001/10/03/international/03LAUN.html
lo-tech, trust-based, stable and fully functional since antiquity. I like it :-)
You'll notice the cost of money transfers using this private system are well below international bank wires. If governments want to reduce/eliminate this "illicit" competition they should fully underwrite the cost of international wires below a certain threshold (say $10,000). steve
on Wed, Oct 03, 2001 at 03:25:33PM -0700, Steve Schear (schear@lvcm.com) wrote:
At 06:30 PM 10/3/2001 +0100, CDR Anonymizer wrote:
http://archives.nytimes.com/2001/10/03/international/03LAUN.html
lo-tech, trust-based, stable and fully functional since antiquity. I like it :-)
You'll notice the cost of money transfers using this private system are well below international bank wires. If governments want to reduce/eliminate this "illicit" competition they should fully underwrite the cost of international wires below a certain threshold (say $10,000).
For some, cost of transfer is a secondary consideration to secrecy, and possibly sufficient to keep a significant underground network active. Peace. -- Karsten M. Self <kmself@ix.netcom.com> http://kmself.home.netcom.com/ What part of "Gestalt" don't you understand? Home of the brave http://gestalt-system.sourceforge.net/ Land of the free Free Dmitry! Boycott Adobe! Repeal the DMCA! http://www.freesklyarov.org Geek for Hire http://kmself.home.netcom.com/resume.html [demime 0.97c removed an attachment of type application/pgp-signature]
At 03:25 PM 10/03/2001 -0700, Steve Schear wrote:
At 06:30 PM 10/3/2001 +0100, CDR Anonymizer wrote:
http://archives.nytimes.com/2001/10/03/international/03LAUN.html
lo-tech, trust-based, stable and fully functional since antiquity. I like it :-)
You'll notice the cost of money transfers using this private system are well below international bank wires. If governments want to reduce/eliminate this "illicit" competition they should fully underwrite the cost of international wires below a certain threshold (say $10,000).
This system accomplishes two main things - moving money securely, and working around government interference with money transfers, particularly India's restrictions on their non-convertible rupee. It's approximately the same system that the Italians ran so successfully during the Middle Ages - have offices in multiple cities in Italy and Spain, and there's enough traffic in different directions that the deposits and withdrawals in each city are mostly balanced, so the risky and expensive job of shipping gold and silver between cities only needs to be done on the net differences, not on the much larger gross, and depending on the level of trust between the different parties, you can float for quite a while and more easily absorb the occasional loss to pirates or shipwreck. This market's a bit more directional, perhaps, but it's dealing with cultures that have been doing lots of trading for millenia, and understand the value of repeat business, so it can adapt to the current needs, and adjusts prices to reflect the costs of moving the net transfers and the current risk value of trust.
C'punks, I ran into a western version of "hawala" about 15 years ago. It was a "blocked currency" service offered by a financial group. Here's how it worked: If you live in a currency-blocked country (South African was one, I think it still might be) you couldn't legally move more than a certain amount out money out of the country. To get around this, you would be asked to tear a small denomination piece of paper money (e.g., a 1 rand note) in half. You would keep one half and the financial group would get the other half. Both halves of the bill would have the same serial number, of course. Later, you would get a call telling you where to take the cash you wished to move out of the country. At the appointed time and place an agent of the financial group would meet you. To prove he was the right guy, he would present the group's half of the bill. You would give him the money and the next day an equivalent amount would be on deposit in an account in your name in whatever country (and currency) you specified. The fee for this was usually just the normal money changer's exchange rate. Of course, the original cash never left South Africa, just as the cash in the hawala system never leaves the countries in question either. One more aside. For a brief period when New Zealand was heavily socialist, the government wanted to stop people from traveling (and spending money) abroad. Instead of banning travel, which would have caused a shit storm of controversy, thy just limited the amount of cash that could be taken out of the country to something like a few hundred bucks. Of course, resourceful Kiwis just used their credit cards... S a n d y
participants (4)
-
Bill Stewart -
Karsten M. Self -
Sandy Sandfort -
Steve Schear