If “punishment interest exceeds the pain threshold….”
The Association of Bavarian Savings Banks, which represents 71 savings banks in the German State of Bavaria, has had it with the ECB’s negative deposit-rate absurdity, and it’s now instigating a palace revolt.
In 2014, when negative interest rates first hit Eurozone banks and ricocheted out from there, Germans called it “punishment interest” (Strafzinsen) because these rates were designed to flog banks and savers until their mood improves. But inexplicably, their mood hasn’t improved.
Bank stocks have gotten clobbered as their profits have gotten hit by the negative interest rate environment. Stocks of Eurozone companies in general have come down hard, and the Eurozone economy simply hasn’t responded very well though the ECB is flogging it on a daily basis with its punishment interest.
And so Bavarian savings banks have had enough. The Frankfurter Allgemeine has obtained a memo by the Association of Bavarian Savings Banks that openly encourages its member banks to stash cash in their own vaults rather than depositing it at the ECB and paying the penalty interest of 0.3% to the ECB on these deposits.
“The savings banks therefore are asking if it might be more economical for them to keep high cash values in their safes and not – as usual – store them at the ECB,” the memo said.
To estimate total costs and determine which would be the better deal – hang on to the cash or send it to the ECB – the association analyzed the costs of additional insurance coverage needed for these higher levels of cash-in-vault and further discussed some options concerning this insurance coverage, or as it says, for “ECB-cash protection.”
According to its analysis, insurance coverage on cash costs 0.15%, plus insurance tax, in total 0.1785%. This is below the ECB’s punishment rate of 0.3%. Each additional €1,000 of cash in its vault would therefore cost the bank €1.785 per year. But if the bank deposited that €1,000 at the ECB, it would cost €3.00 per year. Multiply the difference of €1.21 by tens or hundreds of millions, and pretty soon you’re talking about some real money.
Banks have a total of €245 billion deposited at the ECB. At a deposit rate of negative 0.3%, extrapolated over a year, it costs them €735 million in punishment interest.
“Punishment interest is already costing real money,” is how a senior central bankers explained it to the Frankfurter Allgemeine.
While there might be some additional costs involved for savings banks, such as for transportation of cash or more burglary protection, storing cash in their vaults would still be a better deal and would be worth considering.
There have been some requests for a “ECB-cash protection” program, a spokeswoman for the Association told the Frankfurter Allgemeine but refused to give precise figures. Nor did the Association make any information available on the amount of punishment interest already paid by the savings banks. But it could, as the paper put it, “involve millions of euros.”
To get insurance for this additional cash-in-vault, savings banks can turn to the Versicherungskammer Bayern, the largest public insurer in Germany. It has forever been offering savings banks in Bavaria and elsewhere insurance for their cash holdings. To get “ECB-cash protection,” a savings bank just needs to change its existing policy.
And so the Frankfurter Allgemeine:
In central bank circles, these considerations by financial institutions are carefully noted; they show that punishment interest that exceeds the pain threshold can possibly lead to reactions designed to dodge the thrust of the ECB. The objective of the ECB is to push banks to lend more. But if they store the cash in their vaults, it would be counterproductive.
Punishment interest costs banks more than just the interest they have to pay the ECB: the entire negative interest rate environment is squeezing their profitability. It might work a little better if they could charge savers big-fat negative rates on their deposits, but that would trigger the instant evaporation of cash from the system.
Unperturbed by any sense of reality, Draghi has given the markets to understand that he will ratchet up the pressure. The ECB’s Governing Council will decide the next steps on Thursday. Markets have big expectations, hence the recent rally. Alas, last time he jawboned stocks higher with his promises – or threats, whichever – they plunged after the announcement.
Now the market thinks that the ECB will jack up the negative deposit rate to minus 0.4% or even minus 0.5%, and to make it less destructive for banks, the rates might be hiked in tiers. To which the Frankfurter Allgemeine adds:
Higher negative interest rates increase the incentives for banks with lots of excess liquidity to look for alternatives.
Such as keeping that cash in their vaults instead. But this is just one of many unintended consequences and outright absurdities of NIRP. Read…. “Perverse, Unpredictable Effects” of Negative Interest Rates: Mortgage Rates Soar in Switzerland
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Just another reason for them to buy US trasuries. Euro land is headed down even more.immigration hell and NIRP. Disasterville. How far away can a Brexit be and then?…..
Ok, since this article is about cash. Get out your wallet & look at your money. Right now I have 100’s, 50’s, 20’s, 10’s, 5’s and ones in my wallet. Their is nothing new than 2013. Most are 2009, and all are in pretty sad shape. Paper money wears out, even if it is not outlawed.
Negative deposit rates are unnatural.
Imagine having being shot by a mugger and then having to reimburse the mugger for the cost of the ammunition used! On top of which the mugger gets to keep your money!
The fundamental principle of economics:
People (and institutions) will act in their own perceived best interests. All of the rest of economic theory is merely commentary.
Call Danny Ocean!!!
I smell a heist!
IIRC, cash circulation in Euros actually increased after Europe’s NIRP. Who knew such a common sense response would happen? Shocking, I know.
It would be only all too fitting if the CBs are the ones who laid the last straw that broke the limping economy’s back this time. Maybe God-Emperor Draghi will then have it drilled into his skull that mere mortals like us don’t actually enjoy NIRP loans or free money to cover debt after debt to “stimulate’ the economy.
Well the $100 bill should be safe if the banks want to have them. Unfortunately they’re going to soak them all up.
Plus, the criminals will have all the physical cash. What irony!
Or maybe the cessation of big notes was never about the drug dealers OR individuals putting their cash into safety deposit boxes.
The Palace Revolt will never get off the ground if the recalcitrant banks have nothing bigger than 50 Euro notes for storage. I’m guessing they would have to build new vaults to store ten times the volume of notes.
0.1785 vs. 0.3…
Kind of silly to number-crunch like this. The banks can see the direction central planners want to try to go and…what price flexibility & security in future?
Nobody wants to hold the hot potato, how funny. Why shouldn’t banks pass the cost onto their “customers”, surely they should and do in times when rates are positive.
Somebody’s blowing smoke.
Isn’t it always another simple case of “corporations want their cake and eat it too because that is how capitalism is supposed to work right?”.
Just like how they want the second coming of Jesus to employ for pitiful salaries, and when unsurprisingly nobody bothers to shows up, call the whole affair the “skills gap” or “labor shortage” and whine incessantly like a bitch about how the free market is failing them.
Customers don’t have to put up with it. They can take their money out. And then you have a run on the banks.
In lowering the negative deposit rate to minus 0.4 or 0.5 the ECB pursues the primary goal to widen their bond buying program because they are limited to the existing underlying floor. With lowering the deposit rate they can augment their bond buying program and so encourage the states to expand their fiscal policies to invest in home building programs for the refugees, to repair streets and bridges and so on. These measures could help the economies to pick up speed and then companies will finally invest more and ask for more credits.
‘expand fiscal policies’ = bread and circuses, no need to take painful measures, socialist paradise (now also for everyone from Africa and Asia who wants to join …) while the EU middle class gets eliminated by punitive taxes to pay for all this fun.
Many EU countries are not even able to provide basic services for their own citizens! In Netherlands there are waiting lists of 8-10 years for social housing (you can rent in the ‘free rental market’ but it will cost you 2-4x as much which for many is more than 100% of their income). At the same time migrants get a free home within 3 months of being granted migrant status, so the waiting lists for normal citizens get even longer (they get countless other goodies as well that the normal citizens have to work hard for). Netherlands has never bothered to build more homes (that would be a threat to the epic housing bubble, not acceptable) but now suddenly there are incentives for a massive building program for the migrants. Those would either be ‘temporary homes’ and demolished after 10 years (to make sure home prices keep going up) but some socialist politicians are suggesting it is better to build 400K homes for the migrants and after they have left (if ever, and if there is anything left or the property) people that are now renting social housing could move to these expensive homes with the result that the waiting lists get a bit shorter. Win-win isn’t it?
Or just look at Greece, almost a failed state but let’s build some housing for all Africans and Asians who are flocking to their shores, provide them with wellfare for life and ‘get the economy going’. It’s just as dumb as expanding an economy by having people sell houses to each other for ever higher prices, or stimulating the economy with more wars.
Keeping cash at home attracts thieves. What I expect in this case would be cash vault service which just stores cash. This limits how far NIRP can go. It can only go down to the cost of cash vault service.
But NIRP destroys capital, thus there will be no capital formation, no demand and it will be a death spiral. The best option for the CBs is to throw in the towel on this self-defeating ideas and just increase rates otherwise capitalism will be destroyed completely. Oh I am sure there will be depression today but then not doing it can lead to fascism and the like and a more severe depression later and destroying capitalism. Meaning to say biting the bullet seems to be the best option. Is there any chance of their doing this.
Why cannot the CBs understand that it is mal-investment that is causing the problem, which in turn is induced by low rates. Ensure a high rate of interest so that money is used wisely.
Good comment. I have said this more than once here (i.e. ZIRP destroys capital).
The question one has to ask is: are CBs that stupid?
I sort of think, leaving all the theatrical economic hand waving aside, they understand it in principle (I think most econ PhDs do as well – but neither group will ever let on), so I am left trying to figure out their thinking process and motivations.
In other news, paid off my truck Friday. Nothing but unsecured debt left. :-)
Regards,
Cooter
Keeping cash in a bank also attracts thieves. The thief that breaks into my house has no idea that I have cash, nor where to begin looking for it (the size of a 4″ x 9″ envelope). The thief at the bank knows exactly what I have, shares that info with the govt., and can steal it a little bit at a time, or all at once.
But can the banks simply go all digital?
Let’s have that run on banks, I’m up for that. As far as bypassing them goes, seems there should be plenty of opportunity there, we all could and do already, hopefully, unless I’m missing something?
Banks lend at a rate, I have no intention of lending at a negative rate so they shouldn’t either, or I wouldn’t expect them to but who knows if there’s an opportunity for insiders they’ll take it and leave shareholders holding the bag, I’m pretty sure?
Just like corporations where the CEO makes insane money, 300x or more of any employee, somebody is gonna drown in Noah’s Ocean of liquidity?
The question is, will the flood be local or global? Maybe the FED knows better and doesn’t got there, surely the FED doesn’t cater to bank shareholders but rather, insiders, and that’s the problem, nobody goes to jail, shareholders shoulder the burden on behalf of the criminal enterprise without even a “Thank You”.
Then again, seems like once bank stocks began selling off the FED backed off the rate increase rhetoric, probably only temporarily… in order to suck in the next herd of sheep.
Interesting that gold strength remained even as Treasury 10yr sold off.
Perhaps it’s not that we understand the mechanisms, the problem is we don’t have visibility of when and which direction the tidal wave is coming?
I feel not smart…
“Let’s have that run on banks”
The Banks are effectively a branch of the Government.
This talk of a run on the banks misses the point: that the Government is destroying it’s own credibility and currency through fiscal/monetarist oppressions of the populace and unproductive binge deficit spending.
Hi from Oz. All we need is tech-based banking disruptor app to fix this – how about I invent a peer-to-peer investment/savings app that matches cash lenders with borrowers, at an interest rate that is below what the banks currently lend at, and above what banks currently pay for deposits? In other words, cut out the banksters! Psst: Is there anyone out there who is good with blockchain code???
And who is going to bear the risk? Depositors want to know that they can get their money back…
You mean like so many Depositors in banks in Cyprus?
…Or, maybe like the P.R. Bondholders?
P2P lending might have it’s problems; but, Governments and their associated/chartered banks don’t seem to have a track record worthy of dismissing the concept of a new P2P paradigm outright.
I hate to tell you this, but in the US, deposit insurance by the FDIC has never ever failed. The FDIC over the decades rolled up thousands of banks, and all insured depositors always got their money back, often without any delay since these things happen over the weekend. So that’s the last thing I’d be worried about in the US.
This is symptomatic of the split in Germany that has been going on since the teuro (a play on the common currency and the German teur “expensive, overpriced”) was introduced in 2002.
German exporters have absolutely loved the euro so far: it made their position inside the EMU completely dominant and helped their exports to the US and China. The euro may not be as weak as the Italian lira once was, but it’s a whole lot weaker than the old Deutsche mark.
Savers and to a lesser extent consumers haven’t loved it so much: real price inflation in the first few years was high by post-WWII standards and not all wages have kept up. Those lucky enough to belong to a major union have been doing well, the rest… not so much. And then came the war on savers.
Right now both the financial markets and German exporters expect “strong actions” by the ECB. German exporters saw their business with China, Brazil and Russia (all major export markets) deteriorate and in the past few weeks the euro has staged a strong comeback against the US dollar and, by reflection, the yuan.
If we know Draghi and his colleagues, these “strong actions” will be aimed at nothing short than whacking the euro a little bit more, most likely by cutting interest rates yet again, never mind the fact Denmark, Sweden and Switzerland have gotten nowhere by doing the same over 2015, if not managing to inflate some local housing bubbles in already hot markets (see Geneva) and increasing household leverage in traditionally conservative economies, both recipes for trouble.
How much whacked the euro will get, is anybody’s guess. The currency wars have just begun but there are already a lot of doubts they may lead anywhere. Japan has got absolutely nowhere so far and China doesn’t seem very keen thrashing the yuan, albeit the upcoming Communist Party Congress may change that.
Differently from Haruchiko Kuroda, no European parliament will summon Mario Draghi and grill him mercilessly about his “ineffective” or even “dangerous” monetary policies. The ECB was structured from day one as to completely remove accountability to electors and taxpayers.
But rest assured those thousands of lobbyists in Brussels, Strasbourg and Frankfurt will make their voice heard.
And it will be a battle between lobbyists hired by large exporters, which want the euro utterly destroyed to stimulate their business in face of moribund demand, and those hired by shaky European banks, which are seeing their profits eradicated by post-2008 monetary policies.
The common European saver, like me or those Bavarian citizens, will have absolutely zero voice in the matter.
‘The euro is whole lot weaker than the old D-mark..’
There’s an understatement. If the D-mark was available the US$ would instantly become safe haven two.
It would like finding a new shirt while rummaging for the cleanest dirty one.
Before the ECU came into being (we are talking ancient history here) the two safest currencies around here were deemed to be the US dollar and the Swiss franc. The Deutsche mark was in third place together with the British pound.
I’d take things wouldn’t be a whole lot different.
Right now the dollar and the franc are still very highly regarded in spite of the Fed’s and BNS’s “valiant” efforts at thrashing them.
An old saying among investors is: “Don’t fight the Fed”.
But the Fed (and the BNS) seems to be at war with its own currency.
A run on the central bank. This is the European Banana Union.
Unless governments are ready to stop taxing ‘income’ and institue a wealth tax they are going to be chasing their tails via ‘monetary policy’. The very rich can simply replace a $10 million bank deposit with a $10 million work of art and avoid NIRP. They can also enjoy the dead artists painting hanging on their mansion wall. Yes, they face ‘risk’ in that art prices can go down but so can currencies and that is what Draghi and Kuroda are trying to achieve which, ironically, makes art and high end collectibles go up in price.
OTOH if you taxed ‘wealth’ such that is cost, let us say, $100,000 per year to hang a $10 million dollar painting on a mansion wall, well, the patron of the ‘arts’ might want to invest $5 million to earn the money to pay the wealth tax on his ‘art’.
Tax wealth in the way you suggest and it will disappear, beyond the jurisdiction of your authority. Very quickly.
Higher and more Taxation is not the answer.
The first step to prosperity, is improvement in state department efficiency, and reduction in excessive government employee numbers, benefits, and salary’s.
Everybody is getting cut, except state employees.
The real taxpayers can no longer afford to hold up the inverted Socialist pyramid. Yet the socialist keep demanding MORE MORE MORE from real taxpayers.
Socialism is running out of other peoples money, as the people who still have some realize, Socialist will not listen when they say no. So they will put it their money, where socialist cant get it, then everybody suffers.
@d – What a load of neoliberal BS. The only socialism left is toward corporations – tens of trillions in bailouts and tax breaks over the last 4 decades. Neoliberals have been restructuring financial markets and taxes so the wealthy pay a smaller fraction of their income then their secretaries, so nearly all the GDP growth has gone to the 1%. They have restructured labor markets by killing unions, allowing corporate raids on pensions, cutting social safety nets, funding wars with regressive taxes and deficits, and suppressing wages to prevent goods inflation — while simultaneously pumping liquidity into the system that has created numerous bubbles (that are bailed out – therefore creating more liquidity) which has created asset inflation – primarily financial paper asset inflation which is a continual drain on the real economy. We need higher taxes on the wealthy – especially on finance capital profits which are a rent that does nothing to improve productivity. You need to get past your indoctrination in this neoliberal nonsense – read a few books to educate yourself – Steve Keen, Jack Rasmus and Max-Neef would be a good start.
The more the Socialist try to take, the more innovative, the methods of those who can afford them, to retain their wealth, will be. As the Socialist have created, a Tax Resistance mentality among those with wealth.
Socialist systems implode, every time, as Socialist are lazy takers, and loser’s.
I dont need to read any rich hate books I have watched unions and Socialist destroy industries, economy’s, and country’s.
Tax the rich, is not the answer.
Neither is democracy in its current form, as it become taker socialism. then implodes.
One of the largest wealth categories is property, real estate. You cannot take it out of the country. It will not disappear.
Appropriate category for taxation, unearned income.
That will work for a short time but any thinking person would be smart enough to understand if you raise taxes on the grocery store, the price of groceries either goes up or the store goes out of business. Either way this cost is passed onto the consumer and groceries rise in price. Real smart move.The non-productive by situation will suffer and the non-productive by choice (which is growing daily) will holler louder to get more free lunch. Great fix!
Donald, what in your post is unearned income? Food should not be taxed. You need to know what unearned income is first.
Grocery stores are earning their income
They have that wealth tax in France, including on paintings, and it obviously isn’t working all that well.
How is it not working? What would “working” mean at this point in global economic history? What would a just and prosperous economy look like going forward? (And no cheating by saying it would look like some supposedly golden moment in the past.)
True, but France also has high income taxes. My goal would be to lower taxes on income and make the holding of paintings by dead artists, vintage motorcars and other ‘relics’, which add nothing to current output, more costly.
If Stephen A. Cohen finds it too expensive to keep a multibillion dollar art collection he can donate it to a museum and try his hand at investing in contemporary art and see if it will be worth a billion in 50 years. Alternatively he can actually see if he can build a company that earns money by making products or selling something other than inside information.
I understand your good intentions, but the problem is history taught us once a tax is in place it’s extremely difficult if not impossible to repeal.
Each time you buy fuel in Italy you are still paying a tax introduced in 1936 to finance the war with Ethiopia and which was supposed to be abolished as soon as that war was over.
Canada introduced an income tax immediately after WWII which was supposed to be abolished as soon as the war debt was paid off. Seventy years later, it’s still there.
German taxpayers are still paying two “solidarity taxes” (one on income and the other on fuels) to finance reunification which were supposed to be abolished in 2002.
I could quote such examples all day long.
A wealth tax would be piled on top of those already present: it wouldn’t replace them. And those collectibles would migrate towards Britain, Switzerland, Slovakia, Singapore or whatever place presents a more favorable environment faster the ink would take to dry on the paper the law is signed upon.
Rich people aren’t stupid and have the means to move their wealth around quickly, something most people fail to understand.
That would leave, as usual, the middle class to shoulder the burden. Given our assets are mostly tied up in capital goods or other barely movable investments, we cannot escape.
Many middle class families here have one or two decent paintings as a store of wealth. It doesn’t take a genius to understand what would happen.
In the Netherlands we have a wealth tax of 1.2% yearly (for savings accounts, investments like stocks and bonds etc. above a threshold of about 25K), and even more next year for those with more than 250K or so in capital. With the current 0.5-0.7% interest rate all savers are losing money, even without taking inflation into account (which is much higher than the official numbers suggest).
Private real estate wealth is taxed at 0.3% effectively and with much higher threshold and the stuff that the rich put their money in (art, jewelry, expensive cars, boats, etc. etc) is not taxed at all. And if you have over 10 million capital or so there are SIV’s that pay 0.2% tax instead of 1.2%; you can also move your money offshore legally and pay nothing – of course this too is only available to those with really significant capital, otherwise it would not pay off.
The stuff that the rich are putting their money in has been appreciating at record speed for years, while savings accounts were gradually plundered. This is apparently what our politicians consider ‘fair’. As others mentioned: in reality a wealth tax is a burden for the middle class, not for the elite.
Some banks in greater Europe, have very good, cheap to insure, large vaults.
They will probably start competing with the ECB on the cash storage fee, which is all the ECB Negative rate, really is.
Draggi is telling the euro banks to, LEND, LEND, LEND.
The problem is, anybody worth lending to, has no need, or use for a loan.
In the stagnant economic environment that will be around for at least the next 30 years, baring a major war event. Thanks to china.
The thing’ to heist will not be Bank Vaults (hard work) but the cash transfer trucks, which are well insured.
This is why the ‘war on cash’ is going on. To eliminate any physical medium of exchange, and make us subject to the taxation’s of the State.
Sure looks like it.
Eliminating cash will accomplish several things. It will prevent bank runs. It will enable TPTB to track everything you spend money on, and generate information marketers can use to sell to you. It will give TPTB a way to reduce or eliminate black markets and gray markets. And it will be convenient for banksters to help themselves to your accounts whenever they feel insufficiently remunerated or feel you should be obligated to cover their gambling debts.
In the old days it was merely a nightmare. In the future you can expect a surreal Kafkaesque torment.
“It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
Henry Ford
One suspects TPTB intend to solve the global overpopulation problem by encouraging mass suicides. That way they can blame their victims and still keep their hands clean.
Eliminating cash = capital controls.
One can always stop a bank run by closing the doors and telling the depositors outside that the nasty people with the tear gas and batons and water cannons have been called for.
Eliminating cash is nothing more than capital controls, rationing and/or prohibiting people’s access to their own property.
The intent is Oppression and/or confiscation. Nothing more.
Eliminating cash will not prevent bank runs. A bank run occurs when a large number of bank customers withdraw their deposits in a very short time period.
http://www.investopedia.com/terms/b/bankrun.asp
It does not matter how people withdrawal their deposits or by what method of payment they receive. People can still close their bank accounts and receive a cashier’s check which is usually what happens today when you close your account or people can remove almost every penny from their account by simply writing a check or by electronic transfer. So actual physical cash does not have to be involved for there to be a bank run. Back in 2008 there was a run on the money market funds in which investors fled out of them and into safer Treasury money market funds. Investors did not get actual physical cash when they sold their money market funds and then put it in Treasury money market funds. It was done electronically. In a cashless society the same kind of run can happen with a bank. All depositors have to do is close their account or transfer their money electronically to another financial institution.
Basically true but it will eliminate the ques standing outside banks that the media hypes to sell advertising.
And the bank staff having to physically deal with the scared angry peoplem who want their cash as the cheques will bounce..
The simple solution is to nationalize the banks and reduce them to non-profit public utilities.
Until you do that you masochists are perfectly entitled to all the agonies and miseries you get. Hope it’s worth it to ya.
Outlawing cash will help keep people from taking their money out of the banks.
These actions by governments may actually start a very strong growth in hard assets accumulation by the private sector. Causing the medium of exchange to become more barter- like or go to something like cash, but out of gov control.
Trade script will be one result.
Trading cards, comic books, stamped coins, notched sticks, books of ‘forever stamps’, IOU’s, etc…
The other will be physical proxies.
Pharma, jewelry, musical equipment, collectables…
Drug dealers even use Tide and Enfamil as de-facto currencies in some parts of the US..
Crypto-currencies and ‘virtual world’ currencies. BitCoin to Tolkein Tokens, Pokemoney and Warcraft Credits…
Finally: faux checking accounts with actually printed checks just like are issued by real banks and denominated in FRN..
This has all been done already.
Going forward, investment banks are probably going to rake it in arranging secondaries for all the unprofitable broke companies, so they can extend their lives maybe another 6 months?
Often when you peruse the business section of a German newspaper, it features the big picture of Draghi. I think, they are trying to convey a subliminal message: this guy is like a quintessential Italian, trying to push out solutions into the future, and make euro the next lira.
Storing cash in a vault sound like a no-brainer. However, it meets a major obstacle: it requires cash, and the amount of euros in circulation is limited. So these bank would soak up all the cash in the eurozone and then some.
Hoarding cash in vaults….
Mario Draghi brings out his bazooka today
http://www.theguardian.com/business/live/2016/mar/10/ecb-stimulus-measures-mario-draghi-negative-rates-qe-business-live
yes, and the Big Bazooka already backfired spectacularly.
Euro up, gold up – central banks seem to be losing control of the markets. But in the short run, of course this is great for big multinational corporations in Europe – especially the banks – as they will now be paid for borrowing money (paid for by the savers/taxpayers).
It’s about time that the con game of the century meets it final end.