A frightening new use for Fitbit health trackers… The app that tracks “deadbeat debtors”… Meet Silicon Valley’s creepiest company… In the mailbag: “Legalize it, tax it, and move on”…

U.S. stocks are in the red again today…

After one of the best Januarys on record, the S&P 500 finished the day down 0.78%. The Dow finished down 0.84%. And the tech-heavy Nasdaq dropped 1.33%.

We’ll be taking a deep dive into why the bull market is on shaky ground… and how you can protect your wealth… in tomorrow’s dispatch.

Today, an update on another important theme on our radar – the growth of the Surveillance Society.

As you’ll learn below… it’s happening a lot faster than even we expected. And although China continues to lead the way, America is catching up – fast.

It’s the Gestapo meets Weight Watchers…

There’s no better way to describe the latest revelations about the Chinese government’s push to digitally surveil and control its 1.4 billion citizens.

We’re talking about an article in technology magazine Wired by David Samuels, a veteran reporter. Here’s Samuels…

A friend of mine, who runs a large television production company in the car-mad city of Los Angeles, recently noticed that his intern, an aspiring filmmaker from the People’s Republic of China, was walking to work.

When he offered to arrange a swifter mode of transportation, she declined. When he asked why, she explained that she “needed the steps” on her Fitbit to sign in to her social media accounts. If she fell below the right number of steps, it would lower her health and fitness rating, which is part of her social rating, which is monitored by the government. A low social rating could prevent her from working or traveling abroad.

As regular readers know, the Chinese feds are using a social rating system to divide the population into folks they consider “trustworthy” and folks they consider to be troublemakers.

But having to worry about the number of steps you’ve logged on your Fitbit takes it to a whole new level.

What’s next? Restricting what you can buy at the grocery store because you weigh more than the government’s official guidelines?

You better not go into debt in China, either…

China Daily is an English-language newspaper owned by the ruling Communist Party. Nothing gets printed there if the government hasn’t sanctioned it first.

It reported that a new smartphone app being rolled out in China will alert users when they’re near someone who’s a “deadbeat debtor.” From the China Daily report…

Deadbeat debtors in North China’s Hebei province will find it more difficult to abscond as the Higher People’s Court of Hebei on Monday introduced a mini-program on [popular Chinese messaging and payments app] WeChat targeting them.

Called “a map of deadbeat debtors,” the program allows users to find out whether there are any debtors within 500 meters.

The debtor’s information is available to check in the program, making it easier for people to whistle-blow on debtors capable of paying their debts.

American debtors can still roam free without being tracked by an app. But there’s a disturbing alliance forming between Big Data and Big Government in the U.S., too.

Take the new plan by the IRS to digitally spy on you…

In 2019, 152 million Americans… and 100 million businesses… will file tax returns with the IRS.

Americans will also file 3.6 billion “information returns” – such as the Form W-2 that employers must file on each of their employees… and the Form 1099 that covers rental property and dividend income.

And according to its 2018-2022 Strategic Plan, the IRS wants to search and access that data more effectively using new digital tech.

It’s why, last September, the IRS inked a $99 million contract with data-mining firm Palantir Technologies to build a supercomputer.

Palantir is one of Silicon Valley’s creepiest companies…

Founded by Peter Thiel, an early investor in Facebook, Palantir gets its name from the “palantíri” in J.R.R. Tolkien’s Lord of the Rings trilogy.

Also known as “Seeing-stones,” they’re dark, crystal spheres that show what’s going on in any part of the world.

And along with Google – which benefited from funding from the U.S. Intelligence Community – Palantir is evidence of the cozy relationship between the national security faction of the Deep State and Silicon Valley tech firms.

Thiel’s company got $2 million in early-stage funding from In-Q-Tel, the venture capital arm of the Central Intelligence Agency (CIA). (The “Q” comes from the character in the James Bond movies who makes Bond’s spy gadgets.)

As regular readers know, Palantir is also the firm behind the Los Angeles Police Department’s attempts at predicting crimes before they happen.

It’s now going to link up millions of tax returns… billions of information returns… trillions of bank and credit card transactions, phone records… even social media posts.

We’re not the only ones sounding the alarm on this

When he was just 18 years old, Dan Pilla successfully sued the IRS over its seizure of his father’s business. Today, he’s one of the leading experts on IRS procedures.

Here he is on what the Palantir deal means for U.S. taxpayers…

If a U.S. citizen moves money from a Swiss bank to some other offshore bank, then uses credit or debit cards to spend the money in the U.S., Palantir’s software can link those transactions.

It could also flag a person whose tax return shows relatively low annual income but whose social-media posts indicate something entirely different.

Simply put, Palantir will sync up data from different sources to create one vast, searchable data file.

The goal is for the IRS to be able to “see everything” about your personal, business, and financial lives so that, ultimately, it can take whatever taxes from you it sees fit.

You may not care if the IRS knows what you post on Facebook…

You may even find it convenient having the IRS file your return for you based on its intimate knowledge of your affairs.

Maybe – like so many others – you’re thinking to yourself, “I’ve nothing to hide. So why do I care if the feds are spying on me?”

But if that’s what you think, you’re fooling yourself. Here’s Bill Bonner Letter coauthor Dan Denning with more…

Popular dissent is brewing around the world – whether that be the Brexiteers in Britain, the yellow vest movement in France, or the MAGA (“Make America Great Again”) movement in the U.S. So the Deep State now views every citizen as a potential criminal or terrorist.

“The only means of ridding man of crime is ridding him of freedom,” wrote the Russian dissident Yevgeny Zamyatin. And the feds have taken this to heart. It’s why they’re increasingly using digital surveillance to keep tabs on us and keep us in check.

Silicon Valley builds the tools that make this possible – and gets impossibly rich in the process. Talk about an unholy alliance.

We’ll have more for you from Dan in tomorrow’s update…

Including why he’s currently in New Zealand – an increasingly popular “bolthole” for Silicon Valley billionaires… and why he thinks today’s sell-off in stocks is just a taste of much bigger price falls to come.

So look out for that in your inbox at 5 p.m. ET tomorrow.

Meantime, in the mailbag: “Legalize it, tax it, and move on”…

That’s the message from Daily Cut reader William G. below. He reckons he’s found a simple solution to the pot legalization debate that keeps raging on in the mailbag

Doug is right! It is intellectually dishonest to allow cigarettes and tequila (all liquor) to be legally purchased by any 18-year-old. We know they both cause cancer and are responsible for thousands of innocent deaths every year. Yet we classify marijuana as a Schedule I drug. What’s even sillier is that Schedule I drugs can only be Schedule I if they have no medicinal value, and science and medicine knows cannabis does.

Anyone can buy weed almost anywhere from high schools, to college campuses, to the city council. So why do we create a market for organized crime, gangs, and drug lords to profit from our inability to honestly have this dialog and write it into law? Legalize it, tax it, and move on.

– William G.

In a totally free country, we SHOULD be able to determine what we want to put into our bodies, but this is NOT a totally free country. Totally free includes economic freedom – the freedom to determine if and how to spend the money you earn, outside of a very small amount to be used for those few areas SPECIFICALLY identified in the Constitution. Because we have voted to allow them to do so, politicians have chipped away at personal freedoms from both ends. To buy votes, they have promised to provide free services for many, if not most, of the requirements for living.

There are programs to support people from cradle to grave. Those programs are paid for by confiscating the earning of others, encroaching on their economic freedom. On the other end, recipients of this largesse find that, yes, they can get benefits, but not without strings attached – strings that encroach on their freedoms. As a libertarian, I would support legalization of all drugs, but not without making those who use drugs responsible for paying their own healthcare bills.

– Mike M.

I think all this talk about cannabis legalization is trying to close the gate after the horse has bolted. If you take several steps back and consider our societies, even primitive ones had some sort of concoction of leaves, bark, or the entrails of insects that provided some sort of change in brain chemistry that people used for a level of satisfaction or mental release. It is part of human biology.

Drugs, both legal and illegal, follow the business principle of profit is good, but volume and monopoly are even better. Humanity will always be on the lookout for the brain chemical fix. Some poor souls will blow up their health and die prematurely, no matter whether the drugs are from Big Pharma or are legal or illegal substances. The best we can do as a society is to make the path to moderation easier. Reduce volume and monopoly.

Also, if people were taught how to maximize their health and how to improve their quality of life naturally, the dangers of overconsumption of anything would be generally acknowledged. We need a completely different mindset, not just legalizing one subset of the problem. What are the chances?

– Ken L.

Should we just tax pot and move on like William G. says? Or do we also need to educate people about their health, as Ken L. argues? Write us at [email protected].



Chris Lowe
January 28, 2019
Dublin, Ireland