The battle for money has begun… The end of banking as we know it… Will you open a FedAccount? In the mailbag: “You’re obviously ignorant of the Founders’ intentions”…

The Deep State steps out of the shadows…

Last week, we got further proof that the Deep State – the shadow government that runs the country no matter who is in power – is real.

The New York Times ran an anonymous op-ed from a “senior official in the Trump administration.” It described an administrative coup inside the government to seize power from the president.

If the op-ed writer is telling the truth, high-ranking staffers are thwarting the president’s orders and running the country as they see fit.

But the Deep State isn’t just a creature of government. It’s a hybrid of key elements of government and top levels of the private sector.

In other words, the Deep State is a public-private partnership…

And when it comes to surveillance, of all the elements of corporate America now interwoven with the Deep State – Wall Street, military contractors, defense companies – Silicon Valley is the most vital.

Over the past couple of weeks here, we’ve been uncovering how Silicon Valley is laying the foundations for a mass digital surveillance state. One in which, as Legacy Research cofounder Bill Bonner warns, you’re “always watched, always monitored, always recorded.”

And today, we’ll show you how the noose could get even tighter… as central banks seize full control of the money supply to micromanage every aspect of your financial life.

You may think central banks already control the money supply…

Sure, the Fed can issue new dollars through quantitative easing (QE). But even after it added $3.6 trillion between 2008 and 2015, private sector banks are responsible for about 80% of the currency in circulation in America today.

Contrary to popular belief (and most economics textbooks), when banks make loans, they don’t dip into cash in their vaults… or into other customers’ deposits…

Instead, they loan new money into existence. The fancy term is “ex nihilo,” which means “out of nothing” in Latin.

And crucially, banks lend based on market inputs – such as demand for mortgages or personal loans – and where we are in the business cycle.

Over the summer, the Swiss came close to ending this system…

In June, the Swiss held a referendum on an initiative to hand full control of out-of-thin-air money creation to a centralized committee at their central bank.

The idea behind the initiative is that money is a “public good.” So it should be controlled by the state, not by the private sector and free market forces.

Swiss voters rejected the proposal. But that doesn’t mean the idea of state-controlled money is going away.

There are calls in America for state-controlled money, too…

Also in June, liberal U.S. think tank The Great Democracy Initiative put forward the idea of “FedAccounts.”

In a white paper titled “Central Banking for All,” it made the following proposal…

The time has come to end this special privilege of banks. We propose giving the general public – individuals, businesses, and institutions – the option to have a bank account at the Federal Reserve. We call it a FedAccount.

To begin with, FedAccounts would compete with accounts at private sector banks. But given the Fed could always undercut private sector banks on costs, it’s hard to see the two coexisting for long.

This should send shivers down your spine, says Dan Denning…

Dan is Bill’s coauthor at The Bill Bonner Letter. And he believes the FedAccount idea would be a disaster. Dan…

Given how badly the banks have behaved, it’s easy to see the appeal of neutering them. The trouble is it gives central planners carte blanche to pursue all sorts of hair-brained financial schemes.

Take negative interest rates – central bank jargon for taxing your savings. Under a negative interest rate regime, each month, your savings go down by however much the negative interest rate tax happens to be.

Central bankers say this forces savers to spend… stimulating growth. The problem is banks are reluctant to play ball.

Central banks in Europe and Japan have already forced banks to pay negative rates on their cash reserves. But only a few of these banks have passed on the cost to their customers. Dan again…

A simple way of solving the “problem” – if you’re coming at it from a central banker’s point of view – is to eliminate the private sector banks as deposit-taking institutions. Then there’s nothing stopping you from slapping negative interest rates on savers to “stimulate” the economy.

Think about that. After the next crisis, instead of receiving interest payments on your bank deposits, you’d have to pay to hold money in your FedAccount.

And negative rates may be the least of your worries…

With FedAccounts in place, the government could automatically monitor, track, and record every transaction you make… and make the financial system fully part of the Surveillance State we’ve been warning you about.

And if you step out of line, the feds could immobilize your account with a keystroke. Here’s Bill…

Wouldn’t it be nice for the Deep State if all your financial information… and the control of your money… were directly in its hands?

In Margaret Atwood’s dystopian novel The Handmaid’s Tale, a future U.S. has turned into a police state. The authorities control people with electronic money cards. Like rats in a cage, they get their rations… until the watchdogs cut them off.

If the government controls every aspect of the money system, this could be the real future, not just fiction.

In other words, if the feds seize full control of the money system, they’ll be able to “financially assassinate” you if you disagree with them.

They could directly shut down your FedAccount… your Fed credit cards… your Fed home equity line – everything.

Stay tuned for tomorrow’s Daily Cut. We’ll show you why “central banking for all” is more likely to gain support in America than you may think… and how you can protect yourself.

Finally, in the mailbag: “You’re obviously ignorant of the Founders’ intentions”…

Last week, we asked for your take on “free speech” vs. “hate speech”… and whether you agreed with your fellow readers’ insights. And below, the controversy continues…

After reading the letters from readers, I think that you have all missed the point. So-called hate speech is a concoction of the self-styled progressive left. (If you think that the term “hate speech” sounds eerily like something from Orwell’s 1984, I agree with you.)

By accepting the term “hate speech,” you may well have lost the battle. You have allowed the progressive left to define the argument.

– Warren C.

There are limits to our “rights” under the First Amendment. We can’t yell fire in a crowded theater and you can’t take a podium in Times Square spouting anti-black sentiment. You would be arrested.

Neither should we be allowed to promote an obvious hate-filled, fact-less agenda. We may have rights to do things, but that doesn’t mean we can be insulated from the consequences of exercising those rights. People like [Alex] Jones are one reason this nation is so divided.

– James B.

Please continue your fine effort. Jefferson was correct that only an educated populace can remain free. I think Franklin pointed out that those who give up a little freedom to have a little security will lose both and deserve neither.

– David Z.

Our Founding Fathers knew exactly what they were doing when they wrote the First Amendment: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

Tim P., Todd N., and Steve C. obviously are ignorant of the Founders’ intentions. The Founders knew that there would be lies and outrageous, idiotic arguments. But they asked the right questions: Who are we to judge? Who are we to determine what “the public” should be allowed to hear? The Founders had the right idea of educating the public and allowing the public to make their own judgments.

– Kelly B.

The concept of “hate speech” inherently presumes that certain groups are entitled to special legal protection. This presumption is in diametric opposition to the fundamental statement of natural law in our Declaration of Independence that all men are created equal, endowed by the Creator with inalienable rights including life, liberty, and the pursuit of happiness, because it implies that certain groups are more or less equal or deserving than others.

“Hate speech” is an artificial construct by which certain members of society seek to selectively regulate speech – and, by extension, behavior of others – by setting themselves up as sole arbiters to decide who should be protected, what speech they should be protected from, and how “unacceptable” speech or ideas should be punished. Speech control is a primary tool of totalitarian governments and has no place in a free society.

Wynn R.

Should speech remain as free as the Founders intended? Or should we make exceptions to the rule? Share your thoughts at [email protected]



Chris Lowe
September 10, 2018
Lisbon, Portugal

P.S. Dan shot us an email about what he’ll be presenting at the first annual Legacy Research Investment Summit in Bermuda next month. He’s calling his panel “Wealth Building Outside the Stock Market.”

That’s not to say that everyone at Legacy agrees on Dan’s bearish outlook for stocks. It’s why Dan, along with master trader Jeff Clark, will be debating two stock market bulls – Stansberry’s Doc Eifrig and Jason Bodner, who heads up our Palm Beach Trader advisory – after his presentation.

Space is limited, but it’s not too late to book your seat. Go here for more details…