The future of money (and gold)
derryb
Posts: 36,941 ✭✭✭✭✭
Recently revisited jmski's 2019 thread "Will there be an "economic reset, and what do YOU think an economic/monetary reset would look like?" and it made me realize that it is really a question about the future of money.
Yes there will be a monetary reset and it is already underway:
It required a trigger event - a scare that occurs on an unprecedented level. "Never let a good crisis pandemic go to waste." Fear allows for major shifts in public acceptance (i.e. 911 and the resulting endless wars).
Check.It will require a central bank digital currency (CBDC), While still fiat, a CBDC removes privacy and unfettered possession. All expenditures can be easily tracked and taxed with automatic debits. It can inflate away national debt by more easily creating new money. It can, when determined by the new masters of your money, increase the velocity of money (accelerate your spending) by imposing a negative interest rate (hidden tax) on your digital account balance. It can be used to freeze your ability to transact if your "compliance level" suddenly justifies it. Digital "freezes" are not new, i.e. Twitter, UTube, Facebook.
In process.It will require a paradigm shift in acceptance on the method of new money creation. Modern Monetary Theory lays the ground work for this and preaches to us (well, not all of us) that there is no cost to creating money out of thin air. A CBDC provides an excellent platform to inject new money into the economic system. It retires the printing press.
In process.
"A Horrifying Future" - World Economic Forum's Vision For A Post-COVID World
And gold? Well, the only way to remove its safe haven from under the mattress (or any alternative to fiat money) is to heavily tax, regulate or even outlaw it - an expected Step 4 to finalize the above. Capital gains from the sale of precious metals is already taxed at the higher "collectible asset" rate.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Comments
And in the third world, how can a digital fiat system work without massive infrastructure development- which would take years?
Interesting thoughts/ideas
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Digital payments work just fine in the 3rd world, almost 100% adoption of cellphones.
One of the requirements for successful implementation of MMT is having a national central bank that creates the currency. With MMT's unlimited ability to create money, why would any country, with a central bank and MMT implementation, remain a third world country?
Make no mistake, MMT has been central bank policy since its massive infusion of new money following the 2008 financial crisis. MMT is simply a new name for that dreaded term, Quantaitive Easing. Yes, the Federal Reserve has a marketing department.
Note that the euro zone countries do not print individual currencies and are at the mercy of the EU central bank for their euro's. Could the need for individual national control of a nation's currency and the spending of it's population in a world of central bank digital currencies cause a break in the EU?
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Regardless of how “they” plan to implement digital fiat- the time delay for actual use in Africa and other economies where people live hand-to-mouth will cause an enormous grey market (ie. Barter) to emerge.
@derryb... Well, based on the OP, I now feel less confident in my earlier opinion about a 'reset' being - if at all - in the distant future. Your perspective is chilling. Cheers, RickO
I wonder what the “powerful elite” that currently control of our money supply will do keep people from seeking other forms if tangible investments?
Obviously, taxes and legal maneuvers will be employed to get a “piece of the action”,
Which in turn will cause the grey & black markets to explode.
once all money is held in central bank digital accounts, each central bank can stimulate spending by taking the account's interest rate below zero. Who wants to pay any bank for holding their money? What the central bank cannot do is control where that money is spent unless it creates barriers to alternative forms of savings (such as PMs cryptos) that it does not want to see on the receiving end of money drained from digital accounts. For this reason alone, look for increased efforts to discourage PM and crypto ownership.
As shown with all stimulus money to date it will go into assets, not consumer goods and services that that the central bank hopes for. People hold money because they desire its liquidity. When one form of liquidity costs them, they will turn to what they consider the next best form of liquidity. Because of this central bank miscalculation stimulus will continue to fail to stimulate the economy as it was intended to do.
Step 4 in the OP will include barriers to alternative forms of savings (PM's and cryptos) that do not benefit the masters that the central bank serves. Real estate, bonds and equities will explode much higher should negative interest rates on individual accounts be implemented, as will precious metals and cryptos (if they remain viable alternatives).
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Once all money is funneled into central bank digital consumer accounts, sky is the limit with what can be done, by the government, with the account. Aside from controlling one's saving and spending decisions it can eventually be used to squash dissent (freeze or limit the available funds), directly assess and collect income taxes and possibly be used to cast a vote.
To those that say "we already have digital money in the form of credit cards and payment processors" I say this: those are only digital methods of moving physical dollar bills. Actual digital money will be the only form of money at our disposal.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
So, the problem remains - what tangible assets will offer immediate or nearly immediate liquidity, transportability and recognized “value” ?
Other than highly concentrated forms of perceived wealth (diamonds, gold, rare art...the list goes on...), the only thing left is ones faith in what ever paper assets / real estate titles we own.
Those running the show at the moment are either drinking their own bath water or are not sure of the level of resistance there will be to usurping of ones financial freedom in exchange for eternal serfdom.
Since 2008 it has been ETFs, stocks, precious metals and cryptos.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Level of resistance remains at a minimum. A currency crisis will allow them to make their changes to the monetary system. If you don't have the crisis you need, then create one.
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Won't be happening in our lifetimes, cash is....and will remain king.
The whole worlds off its rocker, buy Gold™.
BOOMIN!™
It appears to me that the goal is to have a "managed economy" down to the personal level. What bothers me most is what bothers most people - we know better how conduct our lives than any bureaucratic governmental agency.
Seems like we've been down this road before in other eras. The digital age just makes it more excruciatingly wrong.
I knew it would happen.
In my opinion, an interesting aside to your comment is the fact that the true endgame is actually being fast tracked to the homeless here in the US and to the poorest nations globally. If you haven't already, research what Bill Gates and his friends are doing to make sure that those who are usually forgotten are not left behind in this great reset. By this I mean implanted chip technology. There is much that could be said or discussed on this be topic.
It’s unfortunate the under privileged / poor and the misinformed will line up for what ever they believe will bring them food or shelter - without understanding the handouts only enslave them further.
This forum is pointless. You have a few normal shills and trolls. Sprinkle in random users and a few regulars. There's some discussion but nothing redeeming. Most of the stuff in this thread I said back in March and you idiots called me crazy. My bitcoin has doubled to $20k, ahahaha, which has meant tons of free gold.
The trolls and shills here are right. Technology never advances and society never changes. People never do the things they're already doing. The unique things happening right now never happen. What are you, crazy? Trillions of dollars were just printed and will continue to be. Did you really think our dollar was getting stronger? Or, in a pandemic, with the country crumbling? Surely, the world has never wanted our money more than now, hahaha.
Meanwhile, water - yes, H2O - will be appearing on the COMEX and not a word from any of you. Physical is still shattering spot which is clearly still fixed when half the world's gold trades in a day. All the pocket change in the US disappears, and not a question.
It's ridiculous what disinfo and misinfo has done to our internet communities. I can't believe I ever thought this place would be a worthwhile source of anything.
How you say something often makes all the difference in the world. Besides, most of us here have been called crazy at one time or another by those who are not crazy,
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong
Meanwhile, water - yes, H2O - will be appearing on the COMEX and not a word from any of you.
Including you. You dropped a little nugget that's supposed to be meaningful, and yet you expressed no opinion or analysis whatsoever.
Congrats on your bitcoin.
I knew it would happen.
Goverments that print and button click Binary money may try to supress Bitcoin as it works against their printed and binary money.
Massive amounts bitcoins are owned by just a few whales. If they sell, watch out below.
Some pundunts turely believe bitcoin will go up to $300,000 per coin.
Do you really want to be holding mostly dollars when the music stops?
Here we go. . . again!
The government is incapable of ever managing the economy. That is why communism collapsed. It is now socialism’s turn - Martin Armstrong