Fed kicks off debate on issuing its own digital currency with new white paper
MsMorrisine
Posts: 33,069 ✭✭✭✭✭
MsMorrisine
Posts: 33,069 ✭✭✭✭✭
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Unfortunately their ultimate goal is to make it the only way for money to be transferred resulting in cash, checks and credit cards becoming obsolete. The danger lies in it becoming the only "money" option.
At that point we will all be in digital concentration camp.
Accounts can be targeted and restricted. Fat people might not be able to buy calories. "Domestic terrorists" or any "undersireable" group can be limited on their financial transactions. Think not? Digital accounts with Paypal, FB and Twitter have shown us how it works.
Savers can be motivated to spend when they do not want to spend by simply throttling the interest rates downward to a point where account holders are paying to have their money held in the account. Forced spending is a great economic tool- it can be used to control the velocity of money. Additionally every dollar spent creates more tax revenue.
It will become like a parent controlling his kid's allowance savings.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Nothing says “666” more clearly than gov-issued digital currency.
I knew it would happen.
Knowledge is the enemy of fear
Troll much?
I knew it would happen.
Scared much? Dont be afraid of the beast. Iron Maiden is rock n roll legend.
On to the OP....did anyone think this wouldnt happen and the response by cryptos would be different?
Knowledge is the enemy of fear
cryptos are not responding to this. They are responding to Russia's crypto ban and to the FED's awakening. CBDCs have been in the works for quite a while. It's not a new-burger.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
The paper is on the Fed website at this link: https://www.federalreserve.gov/publications/files/money-and-payments-20220120.pdf
It is brief, well-written, and worth reading.
Among the many interesting things to think about:
-- Implications of a Fed Digital Currency on private sector banking, and
-- Whether or not interest should be paid on a Fed Digital Currency
The issue of interest bearing currency is particularly interesting to ponder. Imagine how Fed control might change if they could pay interest on money. Suppose you have a wad of $100 bills in your desk, and periodically, for each $ 100, and dollar bills shows up. This would likely change our spending habits. Fed action on the short side of the yield curve might have an almost instantaneous impact on spending.
My opinion posted in a thread last year about CBDCs replacing cash and cash accounts remains unchanged:
You currently have numerous digital avenues with your money and at the same time have the freedom to remove it from your bank when and if you so desire. Technology continues to increase these digital options without taking away your ability to choose cash. Central banks see a Central Bank Digital Currency (CBDC) as an initial step to eliminating cash. This is a world wide effort supported and endorsed by the International Monetary Fund (IMF) and the World Bank. They have good reason to desire the elimination of cash:
Once cash is no longer in use, you can easily be forced to spend when you are faced with negative interest rates on your CBDC account, the only place you can store your money. You will no longer have the mattress vs. bank option. It provides a tool for central banks to throttle both inflation and money velocity. Increased money velocity increases tax revenues. Negative interest rates are a tax on your savings. Do you want to give up the option of not paying your "bank" to hold your money?
Without the ability to hold your cash in your hand you can easily be denied access to it if you, for any reason, do not conform/comply. We are already witnessing this with social media access and job security. We have seen "undesirable" yet completely legal businesses denied access to Paypal and other digital payment processors.
It ultimately is about financial and personal freedom. The removal of choice always reduces one's freedom.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
The FED is always articulate, even when they deceive. They can afford the best paper and speech writers. It would be nice if they employed less politically influenced bankers and more real world, experienced economists who put the economy above Wall St.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Imagine how Fed control might change if they could pay interest on money.
There's zero reason for the Fed to exist, let alone controlling anything such as spending or borrowing.
Scared much? Dont be afraid of the beast.
Says the banker shill.
Iron Maiden is rock n roll legend.
In your mind, maybe.
I knew it would happen.
Plain and simple the FED is a banking cartel. Their interests lie with what's best for the banks that actually make up the FED membership. Their "independence" allows them to conduct business without being held accountable by the public. Unlike elected officials, they have not been accountable since they created themselves over 100 years ago. Economic policy and management should not be given to bankers, don't we have a Treasury Department? Banks should answer to the Treasury Dept., not to themselves.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
If the Fed controls the medium of exchange then how are the banks going to make any money?
On the upper end of commercial development where I was for a long time,
Digital ones and zeros have been the norm since the 70's. You tie up the ground with a letter on credit(no cash),
Build out on your credit( no cash),
Lease and tenant rents go into your account(no cash),
Permanent loan consolidates all debts( no cash),
Hopefully if all goes well you've made money on paper and on to the next deal.
I can only assume the Fed would influence member banks’ actions rather than outright control the medium of exchange.
The same and only way they always have - issuing credit and credit cards. They will approve a loan/debit and transfer money from their digital account into yours for immediate use. You will then repay them in installments from your digital account (after your paycheck gets there) just as you do now. The only difference is the digital accounts will be the only place for money to be held. Lack of choice means lack of freedom.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
If the Fed controls the medium of exchange then how are the banks going to make any money?
They already have obscenely low reserve ratios and create debt at a 10:1 ratio to charge interest on their loans. Isn't that &%#*! enough?
I knew it would happen.
Why would Russia want to stop the flow of monies from west to east?
Knowledge is the enemy of fear
As it is currently being conceptualized, the Fed digital currency will create more ways for individuals to hold money. In particular, there will still be cash and there will still be demand deposits at banks. The consumer should benefit in that banks will have competition for short term deposits and will need to pay higher rates.
The last thing we need is Fed digital currency or control of money by the Feds. Do you really want the Fed to control your ability to transact?
The Fed is an unelected privately-owned entity. They have the power to poof money into existence for their own purposes, and they do. They already are known to break their own rules against stock frontrunning for personal gain - and you think giving them more power over money is a good thing? The Fed should be outlawed, not empowered more. Just my humble opinion.
I'd support an anonymous blockchain distributed ledger crypto long before a Fed digital currency. It's none of the Fed's business to control how, when, why or where I deploy my money (or yours).
I knew it would happen.
@Jmski52 said; The last thing we need is Fed digital currency or control of money by the Feds. Do you really want the Fed to control your ability to transact?
The already do control your ability to transact, and have far more control over money creation than any other entity. In this regard, the creation of a Fed digital currency would be incremental rather than revolutionary. The Fed digital currency could also transfer power from the big banks (that are no popular on this list!) to the little guy.
How would power go to the little guy?
While we are not fans of the big guys in charge, do we really want the little guy in charge?
Knowledge is the enemy of fear
@MsMorrisine asked: How would power go to the little guy?
The very poor would have easier access to electronic funds
Interest rates on cash deposits would likely increase
@cohodk said: While we are not fans of the big guys in charge, do we really want the little guy in charge?
John Adams had some concerns!
The poor has cash without transaction fees
People living paycheck to paycheck won’t get much interest at all
Let me be more specific:
For example, an immigrant making a modest living would be able to send money back home more easily
The prosperous middle class would find it easier to earn interest on liquid savings
Almost 2/3 of Americans are living paycheck to paycheck. Digital currency does not and will not effect them. They have less than $500 savings.
In order to handle a $500 emergency, they have to do a auto title loan, borrow from friends or relatives or do a paycheck loan.
Think about that. They don't have a roll of silver eagles to their name.
Unlike you I'm a big fan of the little guy having the freedom to make his own financial and personal decisions as long as they don't have a negative impact on others.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
When did ever say who i was in favor of, other than repeatedly talking about personal responsibility.
Think about streeters comment...2/3rd of folk dont have $500. Thats the liitle guy and hes the majority. You think you wouldnt be impacted?
Me thinks you aint prepared.
Knowledge is the enemy of fear
The financial future looks bleak if this evolves to the potential described above. This would be the ultimate control... Though I see revolt before that level is achieved. At least in the lifetime of most presently around. Cheers, RickO
GoFundFraudMe just proved what life can be like under a central bank issued and controlled digital currency.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I’m 100% in favor of a Federal Reserve digital currency.
Sent my reply in the day the papers were published.
I NEED the elimination of T+2 and a Digital Currency could facilitate that.
I also NEED 24/7 Market trading.
A Digital Currency could HELP facilitate that…
Most adults prefer to maintain control of their own money.
BTW cryptos do trade 24/7, and you currently don't need your bank "custodian's" permission to buy and sell them.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Did you see how GoFundMe stole $10 million from the Freedom Truckers with the push of a button? You want the value - or even the very existence - of your money to be subject to the proclivities of politicians?
I’m Not afraid of my shadow…
Most on here Are…
That could be one explanation
"Those who would give up essential Liberty, to purchase a little temporary Safety, deserve neither Liberty nor Safety." --Ben Franklin
If you really want someone else controlling the coming and going of your money turn the responsibility over to your kids. At least they have an interest in protecting it. Then again, it is always possible that they too would use it to control your behavior.
I'm in control of where my shadow goes. I'd like to keep it that way. LOL
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Yup no shadows buried down in their bunkers. Continuously rooting for the destruction of this great nation. What a pathetic way to live. To each their own I suppose. RGDS!
The whole worlds off its rocker, buy Gold™.
my bunker in FL provides lots of shadows. Got the pool in the back and the ocean in the front. bunkers are what you make them.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
I snapped this photo of derryb and blitzdude in a heated discussion at last year's forum picnic. Not sure who is who, but they both saw their own shadow. Only one thing is certain..... 6 more weeks of winter.
Continuously rooting for the destruction of this great nation. What a pathetic way to live. To each their own I suppose. RGDS!
One might surmise that when you advocate gold, you are rooting for the destruction of the nation. Do I have that right? Is that your reason for buying gold?
OTOH, it may be that people accumulate precious metals as a hedge against the gross mismanagement of the economy, instead of letting the economy sort out the winners & losers in a logical way based on benefits to the consumer.
I see an internal logic conflict going on when the person buys gold and then disparages the reasons that other market participants have for doing exactly the same thing.
I knew it would happen.
I am continuously rooting for you to make enough money so you can afford to buy a vowel or two...
Has Canada not removed any doubt about why governments should have no reach into the bank accounts of private citizens?
Central Bank Digital Accounts? lol
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Yeah, the situation in Canada makes one think.
Serious question... if a person's bank account is frozen by government action,.,.,. how would bitcoin help getting your groceries, buy gas, keeping power on, keeping a roof on your head? Wouldn't one pretty much still need their bank account or credit card?
@tincup - although I have no direct experience, I believe there are reputable bullion dealers who accept Bitcoin. This should provide a mechanism to convert Bitcoin to cash without a bank.
Gas station up the street has bitcoin atm, has for years.
@DrBuster said: Gas station up the street has bitcoin atm, has for years.
That’s even easier! I haven’t been paying attention—there are three Bitcoin ATMs near me—I hadn’t realized that they had become so common. (Although it looks like some don’t give cash)
Pretty sure these give cash but not sure. The fees are large, ~%20-25 I think was there last time I peeked.
.> @tincup said:
The US Govt has already proven its ability to freeze and seize cryptos.
Knowledge is the enemy of fear
It's that mattress cash that keeps them up at night.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Yup, Uncle joe is worried about what you and I have stuffed under our mattresses down in the bunker. LOL.......NOT!
The whole worlds off its rocker, buy Gold™.