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Interesting note on storing cash in "bunkers", according to Wikipedia [0] (referenced to a book "The Accountant's Story"), Escobar and crew used to have to writ
by codyb 11y ago
Interesting note on storing cash in "bunkers", according to Wikipedia [0] (referenced to a book "The Accountant's Story"), Escobar and crew used to have to write off 10% of their money stored in warehouses because rats would actually come and nibble away at the bills.
Unfathomable to me having so much money that you need literal warehouses for it, but even more amazing is that there was no alternative besides a 10% year over year loss on your stored capital. When you're talking about a cartel that was bringing in roughly $22Bn a year (also Wikipedia) that amounts to roughly $2.2Bn a year sunk to rats.
So, in retrospect, if you can do it legally, the Fed's bills seem like a great deal compared to stockpiling cash. And I'm sure you're paying far less to secure those, although I'm not exactly sure how these treasuries work and if you could just purchase one worth $22Bn and put it in a safe somewhere. Seems like it'd be just about impossible to steal something like that and pass it off as your own.
[0] - https://en.wikipedia.org/wiki/Pablo_Escobar#cite_note-accountant-8 https://en.wikipedia.org/wiki/Pablo_Escobar#cite_note-accoun...
- AnimalMuppet 11y agoFor $2.2Bn a year, it seems like Escobar could have bought a lot of cat food, and a fair number of vets to keep the cats healthy...
- dragonwriter 11y ago> When you're talking about a cartel that was bringing in roughly $22Bn a year (also Wikipedia) that amounts to roughly $2.2Bn a year sunk to rats. 10% annual loss on the warehouse-stored amount does not mean 10% loss of annual income. Some of that annual income is getting turned into non-cash assets, after all.
- codyb 11y agoYea of course, it was just back of the napkin calculations to come up with an upper bound for the amount lost every year. Still staggering even if it was a quarter of that.
- toomuchtodo 11y ago> Unfathomable to me having so much money that you need literal warehouses for it Its talked about in Europe with the ECB using negative interest rates to (unsuccessfully) stoke their economies. http://www.economist.com/news/finance-and-economics/21644203-negative-interest-rates-do-not-seem-spur-inflation-or-growthbut-they-do-hurt http://www.economist.com/news/finance-and-economics/21644203... http://www.bloomberg.com/news/articles/2015-04-23/negative-interest-rates-may-spark-existential-crisis-for-cash http://www.bloomberg.com/news/articles/2015-04-23/negative-i...