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"I am not a number, I am a Free Man" - No. 6
Information Liberation Alex Jones’ Prison Planet Gary North Specific Answers Antiwar The Daily Bell Tenth Amendment Center Economics Policy Journal The American Thinker The New American Lew RockwellPosted by M. C. on March 1, 2022
So, as we wait for the widespread adoption of an alternative to government-controlled money, whether in crypto or elsewhere, those who believe in freedom should consider making the reintroduction of large-denomination bills a political priority. The level of oppression currently on display in Canada makes clear that we must do everything possible to prevent the same from coming here.
https://mises.org/wire/canadas-freezing-protesters-finances-shows-how-war-cash-ends
The Canadian government is now freezing the bank accounts and personal assets of those who donated to support the Freedom Convoy, which is an organized political protest of the vaccine mandates. The deputy prime minister announced that they will retain these so-called emergency powers permanently going forward and will also seek to implement additional measures to further restrict the ability of political protestors to raise funds or otherwise use the banking system.
This highlights the need to eliminate the state’s control over money, at least in societies that wish to remain free. As articulated in a fascinating Twitter thread, constitutional rights become utterly meaningless if there are no practical means to exercise them. Free speech rights and the right to assemble are of little use to those who have no ability to access their money. Organizing an assembly requires being able to afford the costs associated with travel. Exercising free speech rights, at least if one wishes to do so effectively, requires at least some funds to ensure that the message reaches a large audience.
Prime Minister Justin Trudeau understands this fact, which is why his administration has chosen to freeze the bank accounts of those directly involved in the protest, as well as those who merely donated to help support the protest efforts. When a similarly power-hungry tyrant seeks to do the same here in the United States, the Constitution will be utterly powerless to stop them. Good luck mounting an effective protest to an unjust and tyrannical government without having access to money or the banking system.
It is therefore necessary that Americans start taking the necessary measures to help ensure such tyranny cannot come here. While the ultimate solution will require finding a path to free-market money, the Canadian experience makes clear that simply waiting for that to happen is too risky.
In the meantime, more must be done to bring the government’s war on cash to an immediate end. A future president and Congress can accomplish this by requiring the US Treasury to start printing $500 and $1,000 bills immediately, to make up for the loss in purchasing power that has occurred since the Treasury formally discontinued those higher-denomination bills back in 1969. There should also be a requirement that new higher-denomination bills be introduced when needed to offset the effects of inflation. In other words, when the cumulative effects of inflation inevitably produce another 50 percent decline in the value of US currency, the Treasury should also be required to automatically introduce a $2,000 bill into circulation, for example. This is necessary to ensure that Americans’ fundamental right to access cash is not eroded by the silent, but incredibly pernicious, effects of inflation. And while the practical value of this reform is admittedly modest, its main value lies in what it accomplishes in terms of reframing the debate regarding the nature of money and the state.
In other words, it is much easier for a government to implement the totalitarian measures currently on display in Canada when the populace already concedes that the state has the right to monitor banking transactions and views unmonitored transactions as synonymous with illicit activity. Merely protecting the right to access physical cash is thus an inherent repudiation of this view and instead signals a recognition that Americans are entitled to money and banking, especially to those forms of money that are hard for the government to control. And successfully shifting the Overton window in that way would greatly increase the likelihood of enacting more substantive reforms, like repealing the Patriot Act and other bank-monitoring laws.
So, as we wait for the widespread adoption of an alternative to government-controlled money, whether in crypto or elsewhere, those who believe in freedom should consider making the reintroduction of large-denomination bills a political priority. The level of oppression currently on display in Canada makes clear that we must do everything possible to prevent the same from coming here.
Author:
Robert Fellner is the director of transparency research at the Nevada Policy Research Institute.
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Posted in Uncategorized | Tagged: Freedom Convoy, Justin Trudeau, War on Cash | Leave a Comment »
Posted by M. C. on December 7, 2020
At the end of the day, central bank digital currencies are all about control, not meeting consumer demand. The ECB admits as much at several points in their report. Here is just one instance: If people are really demanding a digital euro, why would it have to be assigned legal tender status in order for it to be accepted, as the authors of the report clearly state would be necessary (p. 33)? The only scenario where introducing a CBDC makes sense is in order to phase out the use of physical cash in order to be able to impose whatever negative interest rate regime the central bankers in charge judge necessary. Helicopter money, restrictions on cash holding, and negative interest rates are all part of the bundle of desirable policies that can only—or most easily—be achieved with digital currencies fully controlled by the issuing central banks.
https://mises.org/wire/central-bank-digital-currencies-and-war-physical-cash
Twenty twenty is a year dominated by bad news. While governments around the world have imposed extremely destructive restrictions on economic life and promise a “Great Reset” that amounts to a great leap forward into the socialist future, central bankers have advanced plans for implementing central bank digital currencies (CBDCs). These may arrive as early as next year. Yet what is the motivation behind this innovation? Reports recently published by the Bank for International Settlements1 and the European Central Bank2 provide part of the answer. These publications provide fascinating insight into the theories and ideologies driving central bankers in their pursuit of CBDCs.
One perhaps surprising theme in both reports is the disavowal of any monetary policy behind plans for introducing CBDCs. The BIS report claims that “[m]onetary policy will not be the primary motivation for issuing CBDC” (p. 8) and the ECB report notes that a “possible role for the digital euro as a tool to strengthen monetary policy is not identified in this report” (p. 3). One might first of all suppose that introducing a new form of money would by definition amount to monetary policy, at least in a broad sense, and secondly perhaps find it a tiny bit weird that institutions dedicated to researching and implementing monetary policy would not have considered the potential effects of a new form of money in light of its effects on policy. But what is really striking is that both reports—and especially the one issued by the ECB—at great length detail the implications for monetary policy of CBDC. True, they say they don’t, but looking beyond the executive summary and paying attention to what is written in the report itself puts the lie to that claim.
In order to see this, we only need to look at the key features the central bankers identify as desirable in a CBDC: it should be interest bearing, and it should be possible to cap how much each individual can hold. Both measures are clearly aimed at supporting monetary policy. The cap on holdings forces people to spend their money, driving either price inflation or investment in financial assets, and by making the CBDC interest bearing (or remunerated, in the language of the ECB) it becomes a tool of setting and passing on policy rate changes, including negative interest rates.
The ECB’s Report on a Digital Euro in particular goes on at great length about the need to limit or disincentivize “the large-scale use of a digital euro as an investment” (p. 28). The reasoning behind this position is crystal clear: since monetary policy has driven interest rates into negative territory, the ECB should not allow large-scale holding of digital euros, since investors would then, quite sensibly, chuck their holdings of negative-yielding bonds and seek a safe haven in digital euros—that is, if they can hold them at no cost. Similarly, the ECB is averse to letting people convert their bank deposits into digital euros (p. 16), which would reside in their individual wallets rather than in a bank account. Indeed, the horror of what the BIS and ECB reports call “financial disintermediation” looms large in the minds of central bankers: if people keep their money outside of banks, these will have less money to lend out, thereby increasing borrowing costs. In the words of the BIS report, they are concerned that
a widely available CBDC could make such events [i.e., bank runs] more frequent by enabling “digital runs” toward the central bank with unprecedented speed and scale. More generally, if banks begin to lose deposits to CBDC over time they may come to rely more on wholesale funding, and possibly restrict credit supply in the economy with potential impacts on economic growth. (p. 8)
Of course, Austrian economists since Ludwig von Mises3 understand that “financial disintermediation” can really be a blessing. In the context of digital euros, all it means is that people would hold the amount of cash they deemed desirable outside the banks. They would only make true savings deposits in banks, i.e., they would only surrender money that they did not want instant access to. Under such circumstances, banks would be incapable of expanding credit by issuing unbacked claims to money; they could only make loans out of the funds their customers had explicitly made available for that purpose. This would not only result in a leaner or sounder financial system, it would also avoid the problems of the perennially recurring business cycle. And contrary to what the central bankers fear, the supply of credit would not be restricted, it would simply be forced to correspond to the supply of real savings in the economy. This, unfortunately, is an understanding of economics completely alien to central bankers.
One aim in introducing CBDCs that is only hinted at is the possibility of imposing even lower negative interest rates. In recent years monetary economists4 have increasingly discussed the problem of the “zero lower bound” on interest rates: the fact that it is impossible to set a negative interest since depositors in that case would simply shift into holding physical cash. When manipulating the interest rate is the main policy tool of central banks this is obviously a problem: How can they work their alchemy and secure an acceptable spread between the main policy rates and the market rate of interest when interest rates are already very low? Allowing for the cost of holding physical cash, –0.5 percent seems to be about as low as they can go.
With a centrally controlled digital currency this problem would disappear. The central bank could set a limit on how much each person and company could hold cost free, and above this limit, they would have to pay whatever negative interest rate (or “remuneration,” as the ECB insists on calling it) is consonant with central bank policy. In this way, holding cash would not obstruct monetary policy, as the cash holdings would be fully under the control of the central bank.
There is just one problem with using CBDC in this way: it only works if physical cash is outlawed. Otherwise, physical cash would still simply play the role it does today, i.e., as the most basic and least risky way of holding one’s wealth and of avoiding negative interest rates. The BIS report clearly identifies this problem (p. 8n7), as does the ECB (p. 12n18): a CBDC could help eliminate the zero lower bound on interest rates, but only if physical cash disappeared. So long as physical cash remains in use, the zero lower bound cannot be breached.
However, people might of their own accord come to the rescue of the world’s central banks, sorely beset as they are by the zero lower bound. At least according to Benoît Coeuré, head of the BIS Innovation Hub (the group tasked with researching CBDC), plenty of people want a central bank digital currency. The ECB also sees the decline in the use of physical cash in favor of other means of payment as one of the main scenarios that would require the issue of a digital euro (p. 10).
Now, while some people might like CBDC, there is really no reason to believe, notwithstanding monsieur Coeuré’s anecdotal evidence, that there is widespread demand for central bank digital currency. The ECB admits as much when they write that physical cash is still the dominant means of payment in the euro area, accounting for over half the value of all payments at the retail level (p. 7). But Coeuré does not need to go far to see the continuing relevance of cash: in 2018 researchers at the BIS itself concluded that cash, far from declining in importance, was still the dominant form of payment.5 More recently, a study in the International Journal of Central Banking showed that cash usage is not only not declining, but even increasing in importance.6
Be that as it may, the central bankers are certainly right that there is an increased demand for digital payment solutions and for cryptocurrencies. However, it is erroneous to conclude from this that therefore a central bank digital currency is demanded. Demand for a payment solution is not the same as demand for a new kind of money. It simply means that people demand payment services that allow them to more cheaply transact with each other. Such services are plentifully provided by companies such as Visa, Mastercard, Paypal, banks, and so on and so forth. There is no reason to believe that central banks need to provide this service nor that they could do it better than private companies and banks, and it is simply a mistake to equate demand for such services with demand for a money.
The mistake in the case of cryptocurrencies is even more egregious. When people hold bitcoin or another cryptocurrency, it is not because their heartfelt demand for a CBDC has to go unfulfilled and this is their closest alternative. On the contrary, people want to own bitcoin precisely so they can avoid the negative interests imposed on the established banking system and the risks of holding inflationary fiat money. Introducing a CBDC would not mitigate those risks, but rather add to them, as the central bank would assume total control of the money supply through it and the attendant abolition of physical cash. The felt need for inflation hedges and the desire to escape central bank control, including as it does negative interest rates and caps on how much cash one could hold, would only increase.
At the end of the day, central bank digital currencies are all about control, not meeting consumer demand. The ECB admits as much at several points in their report. Here is just one instance: If people are really demanding a digital euro, why would it have to be assigned legal tender status in order for it to be accepted, as the authors of the report clearly state would be necessary (p. 33)? The only scenario where introducing a CBDC makes sense is in order to phase out the use of physical cash in order to be able to impose whatever negative interest rate regime the central bankers in charge judge necessary. Helicopter money, restrictions on cash holding, and negative interest rates are all part of the bundle of desirable policies that can only—or most easily—be achieved with digital currencies fully controlled by the issuing central banks.
Ironically, far from buttressing the role of central banks and government fiat money, imposing a CBDC may have the completely opposite effect. Replacing physical cash with a CBDC would only strengthen the undesirable qualities of fiat money and further hamper a free market in money and financial services, increasing the demand for alternatives to government money, such as gold and bitcoin.
Author:
Kristoffer Mousten Hansen is a research assistant at the Institute for Economic Policy at Leipzig University and a PhD candidate at the University of Angers. He is also a Mises Institute research fellow.
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Posted in Uncategorized | Tagged: central bank, Digital Currencies, Digital Euro, ECB, Great Reset, War on Cash | Leave a Comment »
Posted by M. C. on July 30, 2020
Posted in Uncategorized | Tagged: coin shortage, credit card, debit card, IRS, Liberty, Liquor Control Board, On Star, Pennsylvania, War on Cash | 4 Comments »
Posted by M. C. on April 15, 2020
According to economist Steve Forbes, “The real reason for this war on cash—start with the big bills and then work your way down—is an ugly power grab by Big Government. People will have less privacy: Electronic commerce makes it easier for Big Brother to see what we’re doing, thereby making it simpler to bar activities it doesn’t like, such as purchasing salt, sugar, big bottles of soda and Big Macs.”
Add to that firearms, ammunition, publications and blogs that deviate from the program…
Much like the war on drugs and the war on terror, this so-called “war on cash” is being sold to the public as a means of fighting terrorists, drug dealers, tax evaders and now COVID-19 germs.
Digital currency provides the government and its corporate partners with the ultimate method to track, control you and punish you.
By John W. Whitehead
“The fact is that the government, like a highwayman, says to a man: Your money, or your life. And many, if not most, taxes are paid under the compulsion of that threat. The government does not, indeed, waylay a man in a lonely place, spring upon him from the road side, and, holding a pistol to his head, proceed to rifle his pockets. But the robbery is none the less a robbery on that account; and it is far more dastardly and shameful.”—Lysander Spooner, American abolitionist and legal theorist
Cash may well become a casualty of the COVID-19 pandemic.
As these COVID-19 lockdowns drag out, more and more individuals and businesses are going cashless (for convenience and in a so-called effort to avoid spreading coronavirus germs), engaging in online commerce or using digital forms of currency (bank cards, digital wallets, etc.). As a result, physical cash is no longer king.
Yet there are other, more devious, reasons for this re-engineering of society away from physical cash: a cashless society—easily monitored, controlled, manipulated, weaponized and locked down—would play right into the hands of the government (and its corporate partners).
To this end, the government and its corporate partners-in-crime have been waging a subtle war on cash for some time now.
What is this war on cash?
It’s a concerted campaign to shift consumers towards a digital mode of commerce that can easily be monitored, tracked, tabulated, mined for data, hacked, hijacked and confiscated when convenient.
According to economist Steve Forbes, “The real reason for this war on cash—start with the big bills and then work your way down—is an ugly power grab by Big Government. People will have less privacy: Electronic commerce makes it easier for Big Brother to see what we’re doing, thereby making it simpler to bar activities it doesn’t like, such as purchasing salt, sugar, big bottles of soda and Big Macs.”
Much like the war on drugs and the war on terror, this so-called “war on cash” is being sold to the public as a means of fighting terrorists, drug dealers, tax evaders and now COVID-19 germs.
Digital currency provides the government and its corporate partners with the ultimate method to track, control you and punish you.
In recent years, just the mere possession of significant amounts of cash could implicate you in suspicious activity and label you a criminal. The rationale (by police) is that cash is the currency for illegal transactions given that it’s harder to track, can be used to pay illegal immigrants, and denies the government its share of the “take,” so doing away with paper money will help law enforcement fight crime and help the government realize more revenue.
Despite what we know about the government and its history of corruption, bumbling, fumbling and data breaches, not to mention how easily technology can be used against us, the campaign to do away with cash is really not a hard sell.
It’s not a hard sell, that is, if you know the right buttons to push, and the government has become a grand master in the art of getting the citizenry to do exactly what it wants. Remember, this is the same government that plans to use behavioral science tactics to “nudge” citizens to comply with the government’s public policy and program initiatives.
It’s also not a hard sell if you belong to the Digital Generation, that segment of the population for whom technology is second nature and “the first generation born into a world that has never not known digital life.”
And it’s certainly not a hard sell if you belong to the growing class of Americans who use their cell phones to pay bills, purchase goods, and transfer funds.
In much the same way that Americans have opted into government surveillance through the convenience of GPS devices and cell phones, digital cash—the means of paying with one’s debit card, credit card or cell phone—is becoming the de facto commerce of the American police state.
Not too long ago, it was estimated that smart phones would replace cash and credit cards altogether by 2020. Right on schedule, a growing number of businesses are adopting no-cash policies, including certain airlines, hotels, rental car companies, restaurants and retail stores. In Sweden, even the homeless and churches accept digital cash.
Making the case for “never, ever carrying cash” in lieu of a digital wallet, journalist Lisa Rabasca Roepe argues that cash is inconvenient, ATM access is costly, and it’s now possible to reimburse people using digital apps such as Venmo. Thus, there’s no longer a need for cash. “More and more retailers and grocery stores are embracing Apple Pay, Google Wallet, Samsung Pay, and Android Pay,” notes Roepe. “PayPal’s app is now accepted at many chain stores including Barnes & Noble, Foot Locker, Home Depot, and Office Depot. Walmart and CVS have both developed their own payment apps while their competitors Target and RiteAid are working on their own apps.”
It’s not just cash that is going digital, either.
A growing number of states are looking to adopt digital driver’s licenses that would reside on your mobile phone. These licenses would include all of the information contained on your printed license, along with a few “extras” such as real-time data downloaded directly from your state’s Department of Motor Vehicles.
Of course, reading between the lines, having a digital driver’s license will open you up to much the same jeopardy as digital cash: it will make it possible for the government to better track your movements, monitor your activities and communications and ultimately shut you down.
So what’s the deal here?
Despite all of the advantages that go along with living in a digital age—namely, convenience—it’s hard to imagine how a cashless world navigated by way of a digital wallet doesn’t signal the beginning of the end for what little privacy we have left and leave us vulnerable to the likes of government thieves and data hackers.
First, when I say privacy, I’m not just referring to the things that you don’t want people to know about, those little things you do behind closed doors that are neither illegal nor harmful but embarrassing or intimate. I am also referring to the things that are deeply personal and which no one need know about, certainly not the government and its constabulary of busybodies, nannies, Peeping Toms, jail wardens and petty bureaucrats.
Second, we’re already witnessing how easy it will be for government agents to manipulate digital wallets for their own gain. For example, civil asset forfeiture schemes are becoming even more profitable for police agencies thanks to ERAD (Electronic Recovery and Access to Data) devices supplied by the Department of Homeland Security that allow police to not only determine the balance of any magnetic-stripe card (i.e., debit, credit and gift cards) but also freeze and seize any funds on pre-paid money cards. In fact, the Eighth Circuit Court of Appeals ruled that it does not violate the Fourth Amendment for police to scan or swipe your credit card.
Third, as commentator Paul Craig Roberts observed, while Americans have been distracted by the government’s costly war on terror, “the financial system, working hand-in-hand with policymakers, has done more damage to Americans than terrorists could possibly inflict.” Ultimately, as Roberts—who served as Assistant Secretary of the Treasury for Economic Policy under Ronald Reagan—makes clear, the war on cash is about giving the government the ultimate control of the economy and complete access to the citizenry’s pocketbook.
Fourth, if there’s a will, there’s a way. So far, every technological convenience that has made our lives easier has also become our Achilles’ heel, opening us up to greater vulnerabilities from hackers and government agents alike. In recent years, the U.S. government has been repeatedly hacked. In 2015, the Office of Personnel Management had more than 20 million personnel files stolen, everything from Social Security numbers to birth dates and fingerprint records. In 2014, it was the White House, the State Department, the Post Office and other government agencies, along with a host of financial institutions, retailers and entertainment giants that had their files breached. And these are the people in charge of protecting our sensitive information?
Fifth, if there’s one entity that will not stop using cash for its own nefarious purposes, it’s the U.S. government. Cash is the currency used by the government to pay off its foreign “associates.” For instance, the Obama administration flew more than $400 million in cash to Iran, reportedly as part of a financial settlement with the country. Critics claim the money was ransom paid for the return of American hostages. And then there was the $12 billion in shrink-wrapped $100 bills that the U.S. flew to Iraq only to claim it had no record of what happened to the money. It just disappeared, we were told. So when government economists tell you that two-thirds of all $100 bills in circulation are overseas—more than half a trillion dollars’ worth—it’s a pretty good bet that the government played a significant part in their export.
Sixth, this drive to do away with cash is part of a larger global trend driven by international financial institutions and the United Nations that is transforming nations of all sizes, from the smallest nation to the biggest, most advanced economies.
Finally, short of returning to a pre-technological, Luddite age, there’s really no way to pull this horse back now that it’s left the gate. While doing so is near impossible, it would also mean doing without the many conveniences and advantages that are the better angels, if you will, of technology’s totalitarian tendencies: the internet, medical advances, etc.
To our detriment, we have virtually no control over who accesses our private information, how it is stored, or how it is used. Whether we ever had much control remains up for debate. However, in terms of our bargaining power over digital privacy rights, we have been reduced to a pitiful, unenviable position in which we can only hope and trust that those in power will treat our information with respect.
Clearly, as I make clear in my book Battlefield America: The War on the American People, we have come full circle, back to a pre-revolutionary era of taxation without any real representation.
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Posted in Uncategorized | Tagged: cashless, covid-19, digital currency, lockdowns, Steve Forbes, War on Cash | Leave a Comment »
Posted by M. C. on April 4, 2020
Being bound to computers for transactions kicks the door wide open to hardcore surveillance of personal activity and location data. Being eternally on the grid means relentless taxation and negative interest rates, which the Federal Reserve is already gearing up for.
None of this bothers the well-heeled boosters of a cashless society or their lackeys in the media. They want Americans reading about the threat of coronavirus cooties on their cash, which is absurd.
https://libertarianinstitute.org/articles/coronavirus-being-used-to-scare-you-away-from-using-cash/
by
Cash has been the target of the banking and financial elites for years. Now, the coronavirus pandemic is being used to frighten the masses into accepting a cashless society. That would mean the death of what’s left of our free society.
CBS News, CNN, and other mainstream outlets are fearmongering again. Alarmism is nothing new in the media world, but this time, it’s not about triggering panic buying or even pushing a political agenda.
The war on cash is about imposing a new meta-narrative. As economist Joseph Salerno explains, the cashless society forces all payments to be made through the financial system. It doesn’t end with monopoly control over transactions, though.
Being bound to computers for transactions kicks the door wide open to hardcore surveillance of personal activity and location data. Being eternally on the grid means relentless taxation and negative interest rates, which the Federal Reserve is already gearing up for.
None of this bothers the well-heeled boosters of a cashless society or their lackeys in the media. They want Americans reading about the threat of coronavirus cooties on their cash, which is absurd.
Germs, of course, can loiter all over credit and debit cards, smartphones, ATMs, and every other cash alternative device. Too bad implanted microchip technology isn’t further along, the banksters must be thinking.
In another CNN article, readers are practically shamed for withdrawing cash to save during a crisis. Every sentence, every word, every letter of the article is nuts.
It begins by reassuring the reader that their bank account is insured by the Federal Deposit Insurance Corporation (FDIC). There’s no mention of moral hazard from CNN. The fact that the federal government guarantees every bank account up to $250,000 encourages reckless financial and banking behavior. Not worth mentioning, CNN?
Prior to the end of World War II, there were $500, $1,000, and $10,000 bills in wide circulation. This cash was dissolved by the Federal Reserve in the name of fighting organized crime. This same argument is now being made against $50 and $100 bills by Harvard economics professor Kenneth Rogoff.
In the Wall Street Journal, Rogoff also wrote that a cashless society would offer such benefits as “greater flexibility for the Federal Reserve to stimulate the economy when necessary.”
He wrote those words in 2017. And these too:
“The Federal Reserve should be able to implement negative nominal interest rates vastly more effectively in the absence of large bills, which could prove quite important as a stimulative tool in the next financial crisis.”
Prophetic. And indeed, negative interest rates would require the assistance of outlawing cash, so that banking customers don’t cheat by simply drawing out on their accounts.
Pardon the pun, but it’s absolutely sick how COVID-19 is being used now as a launching pad for this cashless agenda. There’s nothing to fear about using cash during this time of social distancing.
Wash your hands after handling cash, but don’t give up your moolah. Preserve your health, your privacy, and your liberty.
Reprinted from The Advocates for Self-Government.
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Posted in Uncategorized | Tagged: banksters, coronavirus, War on Cash | Leave a Comment »
Posted by M. C. on February 29, 2020
As such, the populace of each country will welcome them, not understanding that the real purpose is to have the banks determine how much you’re allowed to spend.
Many of these laws will be based on the assumption that cash will be eliminated and all transactions must be undertaken by the banks. Banks will also be authorised to examine what you’re spending the money on.
Cryptos just may be the greatest economic invention of the twenty-first century, and that’s just why they can’t be allowed to go mainstream.
by Jeff Thomas
International Man: Australia has proposed a law that provides a $25,000 fine and two years in jail for those who make cash transactions of $10,000 or more. If passed, the Currency (Restrictions on the Use of Cash) Bill could be implemented in 2020.
Do you see this legislation as Orwellian?
Jeff Thomas: Oh, yes, very much so. The claim by the Australian government’s Black Economy Taskforce is that the law will help stamp out tax evasion, money laundering and other crimes.
What we’ll be seeing is a plethora of laws popping up in all the countries that were a part of the post-war prosperity boom – the US, Canada, Japan, Australia, Europe and others. All those jurisdictions dove headlong into the debt pit that the US created after 1971. All of them are now facing an economic crisis as a result.
Consequently, all of them will be creating capital controls. My belief is that each will host several of these laws, and the others will all adopt them. Each law will be justified as protection against money laundering, terrorism, tax evasion, a rising black market or a combination of those scare tactic focal points. As such, the populace of each country will welcome them, not understanding that the real purpose is to have the banks determine how much you’re allowed to spend.
By having each country put forth a portion of the laws, then having all the others copy them, they’ll hope to make the laws appear to be less draconian. After all, how bad could they be, if all these countries support them?
Many of these laws will be based on the assumption that cash will be eliminated and all transactions must be undertaken by the banks. Banks will also be authorised to examine what you’re spending the money on. At first the oversight would relate to large expenditures, but later, it would be smaller expenditures, that, together, make up larger amounts. The outcome would be that all outlays would be suspect and could be refused by the bank. Those depositors who had a history of transactions having been in question would find that all transactions would be monitored in future (as though they weren’t already).
International Man: How can people combat the laws that are coming?
Jeff Thomas: Anyone who lives in any of the countries that are most seriously at risk still has time, prior to the passage of the laws, to liquidate his holdings in those countries. Then he may move the proceeds to a jurisdiction that’s likely to be safer.
If you own a home, sell it now and rent it back from the new owners. That way, you get to remain in the house you like, but the value of your house would have been taken out of the country. That gives you a nest egg elsewhere, in addition to making it easier to walk away from the house after things begin unravelling.
In a crisis, your true net worth consists of the amount of wealth that you have already succeeded in expatriating. So, you liquidate all assets and get the proceeds safely out. If things don’t go so badly, the money can always be repatriated, but if things do go badly, you will have kept your family from becoming casualties.
International Man: Is a cashless society the only way for governments and central banks to continue to wield their power through debt-based paper currency?
Jeff Thomas: No, there’s a host of means which they can employ. In my belief, they’ll use the “shotgun” method – coming at people with a variety of approaches at the same time. That would make it more likely that when people seek loopholes in the system, those loopholes will already be closed and people resign themselves to their fate.
In normal times, they’d be likely to drag the process out in order to be less obvious, but they’re running out of time. The house of cards hasn’t collapsed, but it’s shaking and they’ll want to entrap your wealth as much as possible as quickly as possible.
International Man: The trend toward eliminating cash completely is accelerating. In a cashless society, every transaction can be tracked and centrally controlled.
What does this mean for privacy and freedom?
Jeff Thomas: It means three things. First, it means that they can keep tabs on all your transactions. Your financial privacy is gone.
Second, it means that in future, transactions can be refused if they’re “questionable.” Maybe your trip to Panama has been deemed unjustified by the powers that be. Or your transfer to a bank in Singapore has been deemed “invalid.” In this way, they’ll be able to not only monitor your transactions, but limit your monetary freedom. Those who repeatedly operate outside of the accepted norm may well go onto watch lists, where they increasingly must seek permission to make transactions.
At first, this won’t be as simple as an “allowed/refused” programme. It will be more polite. You’ll receive a notice that says, “For policy reasons, we have been unable to complete this transaction. Please provide additional documentation as to the purpose of the transaction for our records.” They’ll bury you in requests for documentation. You’ll accept the idea that you must provide them with information, and very soon, you’ll become accustomed to pleading with your bank to use your own money as you see fit.
Third, because they have a record of all your transactions, your government can change the method of taxation from an annual voluntary tax payment to a direct debit. I believe that they would soon announce that they’ll be performing direct debits quarterly or even monthly “for your benefit.” Their claim will be that they’re relieving you of the hardship of the annual big hit and replacing it with a series of smaller ones.
You’ll then see a series of debits on your bank statements that are intentionally confusing. You won’t be able to figure out their method for determining the debit amounts, although it will, over time, become apparent that they’re taking more and more.
International Man: What happens once negative interest rates are incurred on deposits?
Jeff Thomas: Well, once you have no choice but to entrust all your transactions to your bank, negative interest rates will be implemented. After that, they’ll rise, again and again. My guess is that you’ll see rates on your bank statement such as 2.371% one month, followed by 2.592% the following month. It will seem very technical and you’ll come to think of it as being like the stock market, going up and down each month “as necessary.” But it will be a scam. It will quite simply be the theft of your money on deposit.
International Man: What should people be doing to combat this trend?
Jeff Thomas: Well, first off, I’d expect that this will begin in the US, EU, Canada, etc., and then spread outward. There are those jurisdictions like Switzerland, the Channel Islands, etc., that are more geared to providing favourable services to their clients than the large powers do. They’ll hold out at first, but once the majority of the world is on board with this scam, they’ll jump on board also. After all, it’s a license to skin you each month. What bank is going to pass that opportunity up? So, in the end, it will go global.
International Man: Do you see any hope for either derailing this system or opting out of it?
Jeff Thomas: As long as the current economic system remains as it is, no. The only escape is to either get out of cash, or move to a country that’s likely to continue to use cash. And the best that will do will be to buy you a bit more time.
Ultimately, this will succeed up until the day comes when there’s a collapse in the system itself.
Some people will try to escape through the use of cryptos. But if cryptos become the one and only loophole, we can be sure that they will be either taken over or outlawed. There’s zero chance that the powers that be will allow for this massive wealth grab to be thwarted by those who deal in cryptos.
I should mention that, at this point, I don’t have any particular vision in mind as to how this might be done, but the Achilles heel of cryptos is that they are exchanged for goods and services at some point. It will be at that point that a red flag is raised and the trader is exposed and prosecuted for “economic terrorism,” or whatever trumped-up term is created at the time.
Cryptos just may be the greatest economic invention of the twenty-first century, and that’s just why they can’t be allowed to go mainstream. All on their own, they can defeat the banks’ most profitable money-maker and that can’t be allowed to happen.
Editor’s Note: Governments around the world have put their money printing on overdrive.
Unfortunately, there’s little any individual can practically do to change the course of these trends in motion.
The best you can and should do is to stay informed so that you can protect yourself in the best way possible, and even profit from the situation.
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Posted in Uncategorized | Tagged: Black Economy Taskforce, Cashless society, Cryptos, financial privacy, War on Cash | Leave a Comment »
Posted by M. C. on February 26, 2020
What the heck is a windfall profit anyway?
As far as I can tell, it’s whatever politicians decide it is. It’s completely arbitrary. There are no objective measures to define it.
In short, a windfall profit is simply a profit politicians don’t like. The whole concept is a scam—a word trick to camouflage and sanitize legalized theft.
Gold-harder to steal than a digital bank account. Gold-It screams independence. The government like neither.
Never use a safety deposit box. If legal troubles find you the box gets a lock for which you are not allowed a key. If the bank gets in trouble-same.
If you bank is like Wells Fargo the contents of your box are up for grabs.
https://www.zerohedge.com/news/2016-09-07/irs-warns-against-keeping-ira-funds-gold-home
The Internal Revenue Service isn’t too keen on the recent advertisements suggesting retirement savers store their tax-free individual retirement account funds in gold at their house or in safety-deposit boxes, the Wall Street Journal writes.
The statement from the IRS comes in response to a number of ads online and on the radio, such as one from Hartford Gold Group, suggesting investors can avoid stock market turbulence by investing IRA accounts in gold coins and bullion they can store where they like, including their home, according to the Journal.
But the law on such practices is cloudy, the publication writes.
For example, IRA assets can’t be stored in collectibles such as antiques, gems, artworks or wine, according to the Journal. On the other hand, it’s legal to keep IRA investments in coins and bullion-quality bars in metals such as gold, silver and platinum, the publication writes.
But few IRA investment providers offer the option — Vanguard and Charles Schwab don’t allows their clients to invest IRAs in physical metals, according to the Journal.
The IRS may be taking issue with just how difficult and expensive investing in physical gold could end up for the investor. Fidelity, which allows IRA investing in some coins and bullion, charges up to 2.9% to buy and 2% to sell the assets, and a further 0.125% quarterly storage fee, the publication writes.
And keeping the gold at home is not an option: out of tax compliance considerations, Fidelity requires physical metals to be stored at a qualified facility and doesn’t let IRA investors take the gold out or even view it without notification from the IRA custodian, the Journal writes.
Proponents of store-at-home gold say that IRA owners can legally keep their gold in a safe-deposit box or at home if they are the owners and managers of a limited-liability company that uses the funds from the IRA to obtain the gold, according to the publication.
Some attorney says this structure would allow investors to store coins owned by the LLC at home — but for bullion, they would still have to store it in an LLC-owned safety-deposit box, the Journal writes.
Home storage can get pricy, too: one professional whose company provides paperwork for at-home storage of IRA gold charges $400 to $1,200 to set up such an LLC, according to the publication.
And because the issue of LLC ownership by IRA has no legal precedent, companies advertising home storage of IRA gold are careful to note that they don’t provide legal advice, the Journal writes.
* * *
Amid the increasingly mainstream “war on cash” and ‘hoarding’ across the globe, the timing of the IRS’ warning about keeping gold in your IRA seems highly coincidental at best and more than worrisome at least as the “different this time” confiscation methods shift attitudes from concerns to actions…
The government blatantly stole wealth from the American people before.
Many worry the U.S. government might confiscate gold again if it becomes desperate enough. I don’t think those fears are unfounded. The U.S. government’s abysmal financial situation is only getting worse.
But would it really do a 1933-style grab again?
I don’t think it will. However, there is another growing threat to your gold.
More Likely Than Outright Confiscation
Today, only a tiny fraction of the U.S. population owns gold. Heck, I’d bet most Americans have never even seen a gold coin, much less appreciate its value.
This wasn’t the case in 1933, when the U.S. was still on a variation of the gold standard. That’s why the government probably won’t repeat the 1933 rip-off. It’s simply not worth the effort.
If the government wants to confiscate wealth, it’s far more likely to go for the easy option… steadily debasing the currency by printing money. It’s a stealthy way to confiscate from savers.
That doesn’t mean gold owners are in the clear.
I think the government will try a new scam: taxing windfall profits on gold. This would make it much easier for the government to accomplish something similar to its 1933 heist.
There’s precedence for it, too. In 1980, Congress passed the Crude Oil Windfall Profit Tax Act, which taxed up to 70% of “windfall profits” of domestic oil producers.
What the heck is a windfall profit anyway?
As far as I can tell, it’s whatever politicians decide it is. It’s completely arbitrary. There are no objective measures to define it.
In short, a windfall profit is simply a profit politicians don’t like. The whole concept is a scam—a word trick to camouflage and sanitize legalized theft.
If the price of gold explodes, I wouldn’t be surprised if Congress passes a Fair Share Gold Windfall Profit Tax Act levying a tax of 80%, 90%, or more on gold profits.
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Posted in Uncategorized | Tagged: gold, hoarding, IRA, IRS, War on Cash, Wells Fargo, windfall profits | Leave a Comment »
Posted by M. C. on January 23, 2020
People say they are being subjected to humiliation by the banks and their managers who ultimately have the power to decide who gets how much.
Forget keeping your cash in banks. Buy a good safe.
Defeat the war on cash and be prepared for when the next crunch hits.
http://erietimes.pa.newsmemory.com/?publink=2f4c39949
BEIRUT — Before picking up cash from a downtown bank in Lebanon’s capital, Mey Al Sayegh mentally braces herself for what would have been a routine trip before the country’s crippling cash crunch. For starters, it will be at least an hour’s wait in line before her turn comes. And if she’s lucky, she’ll be able to withdraw $300 — the weekly limit on dollar withdrawals imposed by banks to preserve liquidity — without having to bargain with the teller.
“I tell my family ‘I’m going to the bank, but I don’t know when I’ll return,’” said the communications manager. “It’s very unpleasant. You see people’s expression — worried, confused, they’re scared that they’re going to lose their deposits.”
For years, many Lebanese have lived beyond their means, supporting their outsized spending with loans and generous remittances from diaspora relatives scattered across the globe, including family members working in oil-rich Arab Gulf countries.
A severe financial crisis and unprecedented capital controls have put an end to this, uniting both rich and poor in anger against corrupt politicians who have brought the country to the brink of economic collapse, and a banking system they accuse of holding their deposits hostage.
In recent days, some protesters have taken out their ire on the banks, destroying ATMs, smashing bank windows and clashing with tellers behind the counter.
Dozens of protesters have held sit-ins at banks against the fiscal policies, forcing tellers on more than one occasion to give them more than the weekly limit. Demonstrators routinely gather in front of the country’s Central Bank, jeering and hurling expletives at its governor, Riad Salameh, who was once ranked among the world’s top central bank governors.
“You go to a bank, get a ticket, and there are at least 50-60 people in front of you,” said Mahmoud Sayida, a tour guide whose money is trapped with one of the country’s largest lenders. “It’s as though you are lining up for bread in the war days.”
The crisis in Lebanon, one of the most heavily indebted nations in the world, is rooted in decades of state corruption and bad management, and the tiny Mediterranean country’s economy had been in steady decline for years. The local currency, pegged to the dollar for more than two decades, has lost more than 50% of its value in recent weeks on the black market.
Fearing a crisis, depositors in the past year had been quietly withdrawing their money, changing it from the local currency to dollars, or funneling it to bank accounts abroad.
At the onset of nationwide protests that broke out in mid-October, banks closed their doors for 12 working days. When they reopened, they faced an unprecedented rush to withdraw dollars, resulting in the limits on withdrawals and foreign transfers.
But there was no legal basis for such actions, leaving it up to the banks to implement their own controls on a caseby- case basis. Meanwhile, ATM machines have mostly stopped dispensing dollars and daily limits on credit card use have been implemented. Many restaurants and shops, strapped for cash, are refusing card payments.
People say they are being subjected to humiliation by the banks and their managers who ultimately have the power to decide who gets how much.
People with children studying abroad need to offer proof before they are allowed to transfer their tuition money. Patients are required to produce paperwork proving they need money for surgery before they can withdraw cash from their accounts. To get credit card limits temporarily increased, customers are asked by some banks to produce a plane ticket and documentation proving a stay abroad longer than two weeks.
The measures are forcing families to limit expenditures and prioritize daily necessities. Simple activities, such as going to a cafe or a restaurant, are now considered luxuries, even for those with money or jobs. Sullen moods have overcome depositors and lenders alike, whose employees say they are afraid to show up at work because of fights breaking out inside banks and people cursing them every day.
In this Jan. 14 photo, anti-government protesters smash a bank widows, during ongoing protests against the Lebanese central bank’s governor and against the deepening financial crisis, at Hamra trade street, in Beirut, Lebanon. [HUSSEIN MALLA/ASSOCIATED PRESS FILE PHOTO]
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Posted in Uncategorized | Tagged: banks, central bank, Lebanon, War on Cash | Leave a Comment »
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