That’s how Republican senator Tom Cotton put it during a recent Senate Banking Committee meeting discussing a digital-only U.S. dollar.
He went on…
The U.S. dollar has to keep earning that place in the global payments system. It has to be better than bitcoin… it has to be better than a digital yuan.
In Monday’s dispatch, I (Chris Lowe) focused on the first public test of the digital-only version of China’s national currency, the yuan.
Today, I’ll show you why the U.S. dollar is going fully digital, too… and why it’s coming a lot sooner than most folks think.
Tomorrow, we’ll continue our miniseries with a look at how all-digital dollars will be a disaster for your savings and your freedom.
I’ll also show you why gold and bitcoin are the best ways to protect yourself.
That was the term Legacy Research cofounder Doug Casey used when he predicted a digital-only dollar in 2016.
FedCoin is a government cryptocurrency similar to bitcoin… but with none of the privacy or decentralization features.
The Federal Reserve will be the sole entity that can issue it. And like many cryptocurrencies, it will be “programmable money.” You can make FedCoin do all sorts of things paper dollars can’t. Doug…
If I’ve got a $100 bill in my wallet or a bunch of 10s and 20s, I can spend them on anything I want with anybody I want and nobody knows. With FedCoin… the government will know exactly who’s getting the money and what it’s being spent for.
It can be programmed so certain transactions can’t take place. So you are pretty well blocked in. [T]he government knows exactly what you’re buying, what you’re selling, how much you are earning.
They’re in complete control; able to take what they want… including your entire account if you become politically undesirable.
Doug wasn’t the only one here at Legacy Research to see the writing on the wall. This is what his fellow cofounder, Bill Bonner, warned that same year…
The Deep State wants you to use money it can easily control, tax, and confiscate. And paper currency is getting in its way…
Back then, this was just a prediction. Now, it’s happening for real.
They are the Bahamas, the Eastern Caribbean Currency Union, South Africa, Sweden, Ukraine, and Uruguay.
And as I mentioned up top, China’s digital-yuan project is in the test phase in Shenzhen – one of the country’s tech innovation hubs.
But China’s central bank will soon roll out this digital currency nationwide.
Make no mistake… the country is well on its way to achieving its goal of wiping out physical cash and replacing it with a purely digital currency.
If you use physical cash, nobody needs to know about a transaction other than you and the other party to the deal. That allows for anonymity and privacy in your financial affairs.
Digital cash is different. It leaves a permanent record behind every time you transact. This allows governments to directly track, monitor, and analyze every transaction you make, easily in one database.
These digital currencies are a totalitarian’s dream. Imagine what the Nazis’ secret police, the Gestapo, would have done with this level of surveillance of your financial life.
What’s so troubling is that Western governments – including in the U.S. – are planning their own versions.
Colleague Nick Giambruno has been tracking developments closely at our flagship Casey Report advisory. As he explained it…
The idea was for the Federal Reserve [America’s central bank] to create and manage a centralized digital currency to facilitate COVID-19 stimulus payments. Every U.S. resident was to get a digital dollar wallet they could manage on their phone, which the Fed could deposit stimulus money into.
It’s clear there is an effort by some of the most powerful people in the world to bring about a cashless society.
The digital dollar didn’t make it into the final version of the bill. But it’s cropped up in other legislation and in the recent Senate Banking Committee meeting.
The Fed has also announced that it’s working with the Massachusetts Institute of Technology (MIT) to implement a digital dollar.
Take the Bank for International Settlements (BIS). It’s a think tank founded in 1930 and owned by 62 global central banks. Together, the countries it represents account for 95% of the world’s economic output.
The BIS has so much influence over central bank policy, it’s often called the “central bank for central banks.”
And last week, it released a report outlining properties central banks would require from digital currencies. The authors were the U.S. Federal Reserve, the Bank of Canada, the European Central Bank, the Bank of England, the Swiss National Bank, Sweden’s Sveriges Riksbank, and the Bank of Japan.
Then yesterday, the G20 said it was working with the International Monetary Fund and the World Bank to regulate the use of digital-only currencies.
The G20 is made up finance ministers and central bank governors in the European Union plus 19 countries on every continent besides Antarctica.
We can’t know for sure what central banks and governments will do. But we can follow the trends and connect the dots to make a reasonable conclusion.
We know politicians never let a crisis go to waste. And there will be no shortage of potential crises in the near future.
On the one hand, they could make a surprise move to eliminate – or severely restrict – the use of cash. […] On the other, the CIA and the U.S. government use the anonymity of physical cash to fund nefarious activities worldwide. Would they want that to end?
Nick says the benefits of a cashless society will tip the scales in its favor. Because it would give governments and central banks what they desire most – control.
That will have dire consequences for your freedom. Nick again…
The digital dollar will enable a cashless society, which is a totalitarian’s dream. It’s precisely the opposite of how a free society should work.
In a world without physical cash, the government would have complete knowledge of – and control over – every transaction you make. If you’re disobedient, they would be able to turn off your ability to transact at the push of a button. Or they could charge your account.
At that point, governments would have almost unbreakable control over the individual. Further, they’d be able to redistribute the country’s wealth any way they see fit.
As you’ll see tomorrow, Bonner-Denning Letter coauthor Dan Denning has also been sounding the alarm.
He agrees the coming digital dollar will obliterate your financial privacy… making it incompatible with your freedom.
October 14, 2020