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Fed kicks off debate on issuing its own digital currency with new white paper

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  • cohodkcohodk Posts: 18,493 ✭✭✭✭✭

    @jmski52 said:
    Nothing says “666” more clearly than gov-issued digital currency.

    https://youtu.be/WxnN05vOuSM

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • jmski52jmski52 Posts: 22,265 ✭✭✭✭✭

    Troll much?

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • cohodkcohodk Posts: 18,493 ✭✭✭✭✭
    edited January 22, 2022 8:27AM

    @jmski52 said:
    Troll much?

    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?

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • derrybderryb Posts: 36,017 ✭✭✭✭✭

    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.

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • HigashiyamaHigashiyama Posts: 2,133 ✭✭✭✭✭

    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.

    Higashiyama
  • derrybderryb Posts: 36,017 ✭✭✭✭✭

    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.

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • derrybderryb Posts: 36,017 ✭✭✭✭✭
    edited January 22, 2022 9:25AM

    @Higashiyama said:
    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.

    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.

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • jmski52jmski52 Posts: 22,265 ✭✭✭✭✭
    edited January 22, 2022 12:00PM

    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.

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • derrybderryb Posts: 36,017 ✭✭✭✭✭
    edited January 22, 2022 1:56PM

    @jmski52 said:
    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.

    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.

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • streeterstreeter Posts: 4,312 ✭✭✭✭✭

    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.

    Have a nice day
  • MsMorrisineMsMorrisine Posts: 32,039 ✭✭✭✭✭

    I can only assume the Fed would influence member banks’ actions rather than outright control the medium of exchange.

    Current maintainer of Stone's Master List of Favorite Websites // My BST transactions
  • derrybderryb Posts: 36,017 ✭✭✭✭✭
    edited January 23, 2022 8:06AM

    @streeter said:
    If the Fed controls the medium of exchange then how are the banks going to make any money?

    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.

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • jmski52jmski52 Posts: 22,265 ✭✭✭✭✭

    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?

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • cohodkcohodk Posts: 18,493 ✭✭✭✭✭
    edited January 23, 2022 8:23AM

    @derryb said:
    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.

    Why would Russia want to stop the flow of monies from west to east?

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • HigashiyamaHigashiyama Posts: 2,133 ✭✭✭✭✭

    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.

    Higashiyama
  • jmski52jmski52 Posts: 22,265 ✭✭✭✭✭

    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).

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • HigashiyamaHigashiyama Posts: 2,133 ✭✭✭✭✭

    @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.

    Higashiyama
  • MsMorrisineMsMorrisine Posts: 32,039 ✭✭✭✭✭

    How would power go to the little guy?

    Current maintainer of Stone's Master List of Favorite Websites // My BST transactions
  • cohodkcohodk Posts: 18,493 ✭✭✭✭✭

    @Higashiyama said:
    transfer power from the big banks (that are no popular on this list!) to the little guy.

    While we are not fans of the big guys in charge, do we really want the little guy in charge?

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • HigashiyamaHigashiyama Posts: 2,133 ✭✭✭✭✭

    @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

    Higashiyama
  • HigashiyamaHigashiyama Posts: 2,133 ✭✭✭✭✭

    @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!

    Higashiyama
  • MsMorrisineMsMorrisine Posts: 32,039 ✭✭✭✭✭

    The poor has cash without transaction fees

    People living paycheck to paycheck won’t get much interest at all

    Current maintainer of Stone's Master List of Favorite Websites // My BST transactions
  • HigashiyamaHigashiyama Posts: 2,133 ✭✭✭✭✭
    edited January 23, 2022 2:20PM

    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

    Higashiyama
  • streeterstreeter Posts: 4,312 ✭✭✭✭✭

    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.

    Have a nice day
  • derrybderryb Posts: 36,017 ✭✭✭✭✭

    @cohodk said:

    While we are not fans of the big guys in charge, do we really want the little guy in charge?

    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.

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • cohodkcohodk Posts: 18,493 ✭✭✭✭✭

    @derryb said:

    @cohodk said:

    While we are not fans of the big guys in charge, do we really want the little guy in charge?

    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.

    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.

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • rickoricko Posts: 98,724 ✭✭✭✭✭

    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

  • derrybderryb Posts: 36,017 ✭✭✭✭✭
    edited February 5, 2022 7:34PM

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • cagcrispcagcrisp Posts: 1,057 ✭✭✭✭✭
    edited February 6, 2022 6:03AM

    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…

  • derrybderryb Posts: 36,017 ✭✭✭✭✭
    edited February 6, 2022 7:33AM

    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.

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • taxmadtaxmad Posts: 960 ✭✭✭✭

    @cagcrisp said:
    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…

    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?

  • cagcrispcagcrisp Posts: 1,057 ✭✭✭✭✭

    @taxmad said:

    @cagcrisp said:
    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…

    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…

  • taxmadtaxmad Posts: 960 ✭✭✭✭

    @cagcrisp said:

    I’m Not afraid of my shadow…
    Most on here Are…

    That could be one explanation

  • derrybderryb Posts: 36,017 ✭✭✭✭✭
    edited February 6, 2022 8:03AM

    @cagcrisp said:

    I’m Not afraid of my shadow…
    Most on here Are…

    "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

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • blitzdudeblitzdude Posts: 5,285 ✭✭✭✭✭

    @cagcrisp said:

    @taxmad said:

    @cagcrisp said:
    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…

    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…

    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™.

  • derrybderryb Posts: 36,017 ✭✭✭✭✭

    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.

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • jmski52jmski52 Posts: 22,265 ✭✭✭✭✭

    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.

    Q: Are You Printing Money? Bernanke: Not Literally

    I knew it would happen.
  • taxmadtaxmad Posts: 960 ✭✭✭✭
    edited February 6, 2022 2:10PM

    @blitzdude said:
    Continuously rooting for the destruction of this great nation. What a pathetic way to live. To each their own I suppose. RGDS!

    I am continuously rooting for you to make enough money so you can afford to buy a vowel or two...

  • derrybderryb Posts: 36,017 ✭✭✭✭✭
    edited February 21, 2022 7:17AM

    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

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • tincuptincup Posts: 4,721 ✭✭✭✭✭

    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?

    ----- kj
  • HigashiyamaHigashiyama Posts: 2,133 ✭✭✭✭✭

    @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.

    Higashiyama
  • DrBusterDrBuster Posts: 5,300 ✭✭✭✭✭

    Gas station up the street has bitcoin atm, has for years.

  • HigashiyamaHigashiyama Posts: 2,133 ✭✭✭✭✭

    @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)

    Higashiyama
  • DrBusterDrBuster Posts: 5,300 ✭✭✭✭✭

    Pretty sure these give cash but not sure. The fees are large, ~%20-25 I think was there last time I peeked.

  • cohodkcohodk Posts: 18,493 ✭✭✭✭✭

    .> @tincup said:

    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?

    The US Govt has already proven its ability to freeze and seize cryptos.

    Excuses are tools of the ignorant

    Knowledge is the enemy of fear

  • derrybderryb Posts: 36,017 ✭✭✭✭✭
    edited February 21, 2022 4:45PM

    @cohodk said:

    The US Govt has already proven its ability to freeze and seize cryptos.

    It's that mattress cash that keeps them up at night.

    "Do you hear alarm bells ringing? Neither do I. And that’s a huge problem." - Simon Black

  • blitzdudeblitzdude Posts: 5,285 ✭✭✭✭✭

    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™.

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