The War On Cash Is Very Real, Not Just Speculation
Technocracy’s total surveillance ideology demands that anonymous cash transactions be removed from the economic system. Why? Because what cannot be monitored cannot be controlled, and cash transactions cannot be monitored! Thus, the future economy is being fully digitalized. ⁃ TN Editor
In our bizarre economy, we hear many things, and ideas are constantly being thrown out to us. This all tends to flow together and help us develop a strategy as to how we should cope with the changing times. One thing we continue to hear is that a war is being waged to eliminate cash. Not only are most people going along with this but many have embraced the notion.
Some people view carrying cash as dangerous or burdensome.This also dovetails with their desire to spend more than they can afford, when using a credit card it is far easier to continue spending money you do not have. All things considered, when asked, is the war on cash a real thing being directed from those on high, sadly we must answer yes. Cash reflects “options for the people” and it appears those in charge of such things want in gone.
Currencies were developed to facilitate and ease transactions between individuals and businesses. The war on cash is simply another way Washington can continue to show its favoritism towards big business. Small businesses often rely more on small cash transactions and often lack the ability to process other forms of payment. It is ironic that while big businesses and companies like Amazon flourish with each move government makes, the small businesses on Main Street are left worse off.
A cashless society where records are made and kept reflecting every transaction we make even down to buying a candy bar also allows the government to monitor our every move. This is something Big Brother-type governments strongly aspire to under the guise it will extend its ability to protect us or tamp down on crime, tax evasion, and corruption. For some reason, they seem to think this will allow them to collect more taxes, yet it comes at the same time they continue to tilt the tax code in favor of massive companies.
The way the government has handled coins during the pandemic is a clear indication of its unconcern over the role cash plays in our economy. When coin shortages developed, little or no effort to straighten out the mess was instituted. Considering the massive number of coins sitting unused in jars and cans across America it is a situation that could easily be resolved. In fact, coinage has yet to return to full use following the pandemic, and claims of coin shortages persist.
Another place this “war on cash” is showing its head is that as of July 1st my bank started to charge a “cash handling fee” of 13 cents per hundred dollars. Simply put, banks want and feel they are in a position to charge customers for the “inconvenience” of having their employees handle cash.
Let me be clear, banks, saving accounts, and other vehicles designed to hold cash are paying little or nothing in the way of interest. With the numbers just out that the CPI is up for the 15th straight month, cash is under assault. this reflects the fourth straight month above 5% on a year-over-year basis.
While this is the first time the month-over-month CPI has come in below expectations since November 2020 that is not something worthy of celebration. The CPI is routinely criticized for understating and not accurately portraying the true rate of inflation. Another issue is this could be merely the Delta variant’s impactcreating the illusion inflation is not rising as rapidly as some people think.
Inflation, currency debasement, and a slew of other problems have always haunted those holding fiat currencies. This does not mean placing your wealth into one of the new cryptocurrencies is the solution. It does not help that in our world where everything seems to be manipulated, central bankers and their ilk all seem to be moving in the same direction. The masses are trapped in a box and the sides are slowly being moved inward.
Because central banks must keep a lot of liquidity in the system in order to keep it functioning, we have the potential of reaching the place where we drown in paper money and inflation soars. This would signify the end of this war on cash and that cash had lost. It is difficult to justify leaving your wealth in cash that is rapidly losing its value. As we stare into the face of rising inflation and possibly lower negative interest rates the reality that all fiat currencies are in trouble and this is just one big Ponzi scheme becomes very apparent.
How fast events unfold is impossible to predict. Just as important is the order in which the four major currencies fail. We have good reason to be concerned about this because it has the potential to strip us of our wealth and cause major disruptions throughout society. Until then, which may be years away, cash has value and plays a very important part in our lives.
Warning: Digital Currencies Portend Deeply Negative Interest Rates
As a matter of Technocrat policy, “If people can’t hoard physical money, it becomes much easier to cut rates far below zero.” This means your banked funds risk being plundered at the will of the policy makers. Eventually, all money accrues to the takers while the depositors see their wealth vanish. ⁃ TN Editor
Investors have been ignoring progress toward government-issued electronic money, even as many countries are progressing rapidly toward their own online cash. They should ask two questions: Will the Federal Reserve issue a digital dollar? And will it eventually replace physical bank notes?
I think the answer to both questions is yes, and those who agree should be assessing the impact on future monetary policy already, because dramatic change is likely within the timespan of the 30-year Treasury.
The main monetary power of the digital dollar comes from the abolition of bank notes. If people can’t hoard physical money, it becomes much easier to cut interest rates far below zero; otherwise the zero rate on bank notes stuffed under the mattress looks attractive. And if interest rates can go far below zero, monetary policy is suddenly much more powerful and better suited to tackle deflation.
Before going on, a quick definition: I’m talking here about central bank-issued money usable by you and me, just as bank notes are. It might (or might not) pay interest, but it is different to money in an ordinary bank account, which is created by the commercial bank; the existing central-bank digital money, known as reserves, are used only to settle debts between banks and certain other institutions, not available for ordinary use.
Deeply negative rates won’t come straight away. Initially, central-bank digital currencies will almost certainly be designed to behave as much like ordinary bank notes as possible, to make their adoption easy and minimize disruption, while use of physical cash will be allowed to wither away. But those close to the development agree that monetary caution is unlikely to last.
“Central banks are making lots of effort to make sure that CBDC isn’t seen as a possible monetary-policy instrument,” says Benoît Coeuré, head of the Bank for International Settlements’ innovation hub and a former European Central Bank policy maker. “My take is that that discussion will come only later.”
BIS Tests International Settlements With Central Bank Digital Currencies
Global Fintech is rapidly congealing as Central Bank Digital Currencies (CBDC) are integrating into the Bank for International Settlements (BIS) in order to “lay the foundation for global payments connectivity.” Fintech is said to the coming financial structure for Sustainable Development, aka Technocracy. ⁃ TN Editor
The Bank for International Settlements and four central banks will test the use of digital currencies for cross-border transactions, as global regulators seek to improve the speed of movement of money in a cheaper, more transparent manner.
The BIS Innovation Hub, along with Reserve Bank of Australia, Monetary Authority of Singapore, Bank Negara Malaysia and South African Reserve Bank, aims to develop prototype shared platforms for cross-border transactions using multiple central bank digital currencies, or CBDCs, the group of global regulators said in a Sept. 2 press release.
The project “brings together central banks with years of experience and unique perspectives in CBDC projects and ecosystem partners at advanced stages of technical development on digital currencies,” said Andrew McCormack, the chief of the BIS Innovation Hub Singapore Centre. The Geneva-based group is confident that the experiment will “lay the foundation for global payments connectivity,” McCormack added.
Interest in CBDCs, which are envisaged as digital notes of fiat currencies, is rising with changes in the way payments are expected to be made in the future. Central banks globally are keen to protect the public’s trust in money as a clutch of cryptocurrencies seek legitimacy as an alternative form of money. A BIS survey of central banks found that 86% were actively researching the potential for CBDCs, 60% were experimenting with the technology and 14% were deploying pilot projects.
The proposed platform will allow financial institutions to transact directly with each other in the digital currencies issued by participating central banks, eliminating the need for intermediaries and cutting the time and cost of transactions, BIS said. The project will explore the international dimension of CBDC design and support the G20 group of nations’ effort to enhance cross-border payments.
The project is a “significant contribution” to the global vision to make payments cheaper and faster, said Sopnendu Mohanty, the chief of financial technology at the Singapore central bank. “The findings on how a common platform can be governed effectively and managed efficiently will shape the blueprint of the next-generation payment systems.”
The results of the experiment, expected to be published in early 2022, will be used to develop future platforms for global and regional settlements, BIS said. Prototypes of the proposed shared platforms will be developed in collaboration with technical partners on different distributed ledger technology platforms and demonstrated at the Singapore FinTech Festival in November.
The project will also explore governance and operating designs that would enable central banks to share CBDC infrastructures and gain from collaboration between public and private sector experts, it added.
Digital Health Passports Are Trojan Horse For Cashless Society
Technocracy’s view of managing the health of society and a cashless system is synchronized with their concept of the “science of social engineering.” The “engineers” write the prescriptions for total control. Seeing health passports as being separate from a cashless society is incongruous. ⁃ TN Editor
Several new technologies that appear separate and unrelated will soon converge, creating a giant digital trap that will easily entice the uninformed masses.
The digital trap has already been set and globalist elites are using COVID to speed up the process of convergence. Most people will sleep-walk right into the trap, which will ultimately reduce them to a human QR code – trackable, traceable, and 100 percent dependent on Big Tech and big government for their existence.
I’m going to unpack each of these seemingly separate threads that will be gradually merged into a single overarching socio-financial control grid.
The most imminent agenda item needed to jumpstart this system is a successful launch of digital health passports.
France, Italy, Ireland, Germany, Greece and many other nations have started mandating these passports on their citizens, many of whom are flooding into the streets to protest.
The movement toward digital health passports in the U.S. is happening more gradually but it’s picking up steam.
When asked for clarification on exactly what COVID rules might be implemented, White House Press Secretary Jen Psaki said nothing is off the table.
Remember that phrase: Nothing is off the table.
This could involve rounding up the unvaccinated and placing them in isolation and quarantine camps.
An academic consortium consisting of six universities already has a contract with the U.S. Department of Homeland Security to provide training for government, law enforcement, healthcare and private-sector stakeholders on how to quarantine “large portions” of rural communities.
But the drive to digitize the lives of Americans will start in the cities and move outward.
New York Mayor Bill de Blasio became the first politician to jump at the opportunity to demand vaccine passports.
Despite what anyone tries to tell you, separating Americans by vaccine status is a historic first. It has never before been tried, not through the polio or smallpox outbreaks of the 1920s, 30s and 40s, not during the Spanish Flu. Not ever.
De Blasio ordered businesses to deny service to the unvaccinated, which accounts for 30 percent of the city’s population. It remains to be seen how de Blasio will enforce this edict. Will he call out the police to shut down businesses not demanding a show of papers from their customers?
New York Gov. Andrew Cuomo is also shooting for vaccine passport mandates statewide but knows he has to be a little more diplomatic in his approach.
“Private businesses, I am asking them and suggesting to them, go to vaccine-only admission. Go to vaccine-only admission,” Cuomo said in an Aug. 2 press conference.
“I believe it’s in your own business interest,” he said, “to run a vaccine-only establishment…. We have apps, just say, ‘you have to show that you were vaccinated when you walk in the door.’”
In other words, “Show your papers.”
Think about what Cuomo is saying here.
He is very forcefully “asking” business owners to eliminate 30 percent the state’s population from their field of potential customers and treat them as non-persons.
This is pure fascism and reminds one of the Nazi propaganda that coerced Germans to refuse to do business with Jews.
If New York’s business owners listened to Cuomo, they would make it impossible for non-vaxxed people to feed their children.
The digital passports require people to download a scannable QR code on their cellphone that will allow businesses to know they’ve been vaxxed before they are allowed to enter and receive service [buy or sell].
That leads us to the second leg of the digital trap that is baking in the technological oven – a new global digital ID system that is capable of working in conjunction with the digital health passports and the new medical-vaccination complex.
The leader in this stream of tech is the ID2020 Alliance, a collaborative of more than 35 members including Accenture, Microsoft, the Rockefeller Foundation, MasterCard, IBM, the International Chamber of Commerce, MIT SafePaths and Bill Gates’ GAVI Global Vaccines Alliance.
In February 2021, ID2020 launched the Good Health Pass Collaborative to encourage a seamless convergence of all the COVID-19 vaccine credentialing apps being developed by many different organizations.
“Paper vaccine certificates can be easily forged,” the ID2020 Alliance warns in a press release. “The purpose of health credentials is to securely prove that a person has received a vaccine or PCR test. The new alliance is particularly targeting travel to ensure credentials work cross-border, cross-industry and are frictionless.”
The alliance has published a white paper on the topic for those seeking more details.
Yet another piece to the evolving techno-fascist puzzle is the new digital currency.
The world’s central banks are working on a programmable digital currency based on block chain technology. This means they will be able to track your spending and shut you off for any reason.
The International Monetary Fund posted an article on its website in July lauding India as a global leader in the drive to eliminate cash. And of course COVID was mentioned as expediting the move away from paper money. The IMF noted:
“COVID-19 has accelerated the use of contactless digital payments for small transactions as people try to protect themselves from the virus. These advances build on the India Stack—a comprehensive digital identity, payment, and data-management system that we write about in a new paper (Carrière-Swallow, Haksar, and Patnam 2021).”
As you can see in the above statement, the goal is a comprehensive digital identity, combining one’s health data and vaccine status with banking and other personally identifiable data.
Klaus Schwab warned us ahead of time about the trap he and his elitist buddies were setting for us.
“Fourth Industrial Revolution technologies will not stop at becoming part of the physical world around us—they will become part of us.
“Indeed, some of us already feel that our smartphones have become an extension of ourselves. Today’s external devices—from wearable computers to virtual reality headsets—will almost certainly become implantable in our bodies and brains.”
When he penned these grandiose ideas in 2018, it seemed like the pie in the sky musings of an out of touch futurist and few paid attention. Post COVID, it’s in our faces and ready to be implemented.
The final leg of the technological program to control humanity is the Big Tech giants working together to scrub all dissident voices from the Internet. Their ultimate goal is to create a system where all users have an Internet passport, subject to periodic review of your online activity.
The Big Tech giants have already said they actively share information in an effort to crack down on “white supremacists” under the Global Internet Forum to Counter Terrorism, a body previously reserved for targeting the Taliban and al-Qaeda.
PayPal announced it will be working with the notoriously Marxist Anti-Defamation League to scour the Internet, looking for “extremists” and “anti-government” voices in order to shut off their PayPal donation buttons.
Under this Chinese-style social scoring system, those guilty of online infractions get publicly shamed and silenced. Information collectors are paid to snitch on their neighbors and family members. Once your social credit score dips below a certain level, you become so discredited that it gets tougher and tougher to find a job, travel by plane, train, bus or car, get loans or put your kids in the better schools.
Those providing counter-narrative information will be flagged, given a warning, and eventually blocked as disseminators of “disinformation.”
You lose your freedom of speech, but that’s not all.
In today’s society, being removed from the Internet means you won’t be able to buy or sell online or work a job that requires an internet connection.
So the health passports, currently being rolled out worldwide, will block you from in-person shopping for food and necessities while the coming Internet passport will block you from ordering your necessities online. You will essentially be left with the black market, assuming one will spring up for those deemed “unclean” and “unfit” for the modern world because of their dissident views.
All of these technologies will merge at the intersection of Big Data, big banks, Big Tech and big government. Your social credit score will now be tied in not only to your Internet activity but to your bank account and your vaccine status. Welcome to the Great Reset, a/k/a New World Order.
Add in advances in AI and facial recognition and millions of surveillance cameras and you are talking about a lockdown slave state that makes George Orwell’s 1984 look like a picnic in the park.
But don’t complain. It’s all “for our safety.”
People cannot be trusted to do the right thing, to believe the true facts, to lead the kind of life that results in a peaceful, happy society. All must conform to the new masters.
Now is the time to fight this system. But in order to fight it, you must recognize its existence and stay one step ahead of the cabal’s evil game plan.
At some point the trap door will shut. It will be too late to opt out. You either comply or become a non-person. An enemy of the state.
These separate avenues of evolving technology will eventually be merged to create a society in which everything, and every person, is digitally tracked. Not just the movement of their physical bodies, but their actions, behaviors, even their thoughts.
The elites are counting on us accepting this system in its early, fragmented stages. Most people think compartmentally. They don’t connect dots. They will be deceived.
The elites are not going to tell you upfront what all is involved in the Fourth Industrial Revolution. They’re just going to tell you the parts that sound good – convenience, inclusion, safety, security.
Watch the creepy 42-minute video put out by the government of Australia urging people to create a digital identity.
Once this trap door is shut, it will be very difficult to get out of its clutches. Don’t download apps, pay with cash whenever possible, and stop sleep walking into the New World Order.
India Stack: The Future Of Fintech, Cashless Society And Total Inclusion
The United Nations already declared Fintech as the chosen financial system for Sustainable Development, aka Technocracy. It is, of course, all digital and includes creative blockchain technology for management and control of everything. It also demands 100 percent inclusion of all citizens in the system. This IMF article shows how India is leading the way. ⁃ TN Editor
A digital infrastructure known as the India Stack is revolutionizing access to finance
A decade ago, India’s vibrant local markets were filled with people buying and selling goods with well-worn banknotes. Today, they are just as likely to use smartphones. Advances in digital finance mean that millions of people in the formal and vast informal economy can accept payments, settle invoices, and transfer funds anywhere in the country with just a few screen taps. COVID-19 has accelerated the use of contactless digital payments for small transactions as people try to protect themselves from the virus. These advances build on the India Stack—a comprehensive digital identity, payment, and data-management system that we write about in a new paper (Carrière-Swallow, Haksar, and Patnam 2021).
The India Stack is wideningaccess to financial services in an economy where retail transactions are heavily cash based. A digital ID card dramatically lowers the cost of confirming people’s identities. Open-access software standards facilitate digital payments between banks, fintech firms, and digital wallets. And access to people’s personal data is controlled through consent. The expansion of digital payments, facilitated by the stack, is an important driver of economic development in India and has helped stabilize incomes in rural areas and boost sales for firms in the informal sector (Patnam and Yao 2020). Other emerging market and developing economies could learn from the experience.
Layer 1: Digital identification
The first step in the creation of the stack began in 2010 with the launch of a biometric digital ID system dubbed Aadhaar—Hindi for “foundation.” The government initiated a campaign encouraging people to have their photograph, fingerprints, and other biometric details taken at enrollment centers across the country. Each person received a unique 12-digit identification number that could be used to access a range of services. Remarkably, 1.2 billion people—almost 90 percent of India’s population—signed up for a digital ID in less than a decade, about half of them linking their new ID to their bank account (see chart 1). Legal limits on the mandatory use of digital IDs helped protect people’s right to privacy.
Prior to Aadhaar, patchy record-keeping meant that nearly half the population lacked a nationally accepted ID card. Driver’s licenses, voter ID cards, and the like could provide authentication for a patchwork of services. However, the complexity of verifying identity made it costly to deliver banking and other services. After all, who would lend money to someone whose identity was unknown?
India’s central bank saw the potential for Aadhaar to transform banking. It developed an electronic procedure so that commercial banks could verify a new customer’s identity instantly through the Aadhaar database. These biometric checks reliably verify the identity of the holder, thus reducing the likelihood of false identities and fraudulent claims. An ambitious financial development policy (Pradhan Mantri Jan Dhan Yojana) was launched to provide a bank account to all households in India. In just one year, 166 million people had opened accounts as part of the program. The number had risen to almost 384 million by 2019.
Government benefits could be paid directly into these newly opened accounts, and people could access their funds conveniently through debit cards or smartphones. It represented an impressive fast-forward of traditional financial development. Only a decade earlier, just one in three adults in India had a bank account. Similar expansions in financial access elsewhere have taken almost half a century (D’Silva and others 2019).
Persuading people to open bank accounts was just the start, however. Nearly half of all bank accounts in India are inactive, meaning they never receive a deposit—the highest number of inactive accounts in the world (Demirguc-Kunt and others, 2018). Further progress depended on adding more layers to the stack.
Layer 2: Interoperable payments
Even as the government was widening access to bank accounts, India’s fast-growing fintech firms were launching digital wallets and mobile money. These innovations made it cheap and simple to store and transfer money digitally—even for those without a bank account. This prompted an innovation by the authorities. They introduced a new layer to the retail payment system, known as the Unified Payments Interface (UPI), so that banks could exchange messages and payment orders with nonbank firms. This formed the second layer of India Stack.
With the new system in place, street vendors and small traders without a bank account could receive payments for goods or services through a digital wallet. They could transfer funds instantly to someone else—a struggling relative in a remote village, say—so long as the recipient too had a digital wallet. In many other countries, in developing economies especially, transfers like this would take days or even weeks and would likely involve depositing cash at a distant bank branch and paying hefty transfer fees.
As with the Aadhaar digital ID, a crucial feature of the system was its interoperability: users could transact with all actors in the financial system, public and private, large or small. To participate in the UPI, fintech firms were required to partner with a bank or obtain their own special license. Keeping all participants under the watchful eye of the regulator allowed the central bank to promote financial inclusion while safeguarding stability. The system has expanded rapidly and has also seen the swift entry of big tech firms. Most small retail payments in India are now channeled through the UPI (see chart 2).
Layers 3 & 4: Trust through consent
Data is emerging as a key part of the digital economy. Access to, and control over, it increasingly determines an economy’s growth, equity, and stability (Carrière-Swallow and Haksar 2019). A third “paperless layer” of the stack allows for verification of digital documents that can replace traditional paper equivalents, increasing efficiency and integrity. More important, the fourth and final layer of the India Stack (which is not yet fully operational) is formed of aggregators that intermediate the flow of financial data between individuals and financial firms.
These data go-betweens (“fiduciaries,” in the jargon) are responsible for managing personal data. Regulations state that they must obtain people’s consent before they process personal data. Fiduciaries may not access or store any data that has been shared, but they can charge for their services. This is a very different approach from those in many other countries. Elsewhere, aggregators typically offer services in exchange for access to data, which they can then use to sell other financial services.
Data fiduciaries can offer the trust that adds synergies to the various layers of India Stack. They can authenticate individuals’ identity, based on their digital ID, and confirm to third parties that data do indeed describe a particular person. Fiduciaries can also use the stack’s application programming interface (API), an open-access software standard that allows different applications to communicate with one another, to certify the veracity of digital documents. These documents might include statements of financial assets, liabilities, and cash flow—a powerful basis for establishing trust in the digital economy and a way for people to leverage the data their activities generate. It can also support access to financial services for people in the informal sector who can produce few records proving their creditworthiness.
Lessons from India
No single aspect of the India Stack is entirely unique. However, its comprehensiveness has succeeded in building a more inclusive digital economy from the bottom up. The Indian experience offers several lessons:
A foundational approach providing a range of public infrastructure and policies can allow for significant synergies across different parts of the digital economy. A digital ID system promotes widespread inclusion by giving everyone a foothold in the digital economy. Common approaches to APIs can set up an ecosystem for data and payment flows that is open to participation by many providers, leading to innovation and choice for the consumer. Data fiduciaries will potentially operationalize greater user control over individual data, setting the stage for the transition from open banking to an open-data economy that spans many sectors.
Interoperability is a useful tool for fostering competition in digital financial services. The India Stack ecosystem is vast, allowing existing financial intermediaries, as well as big tech firms and new fintech companies, to compete. But it is also mindful of the need for stability to underpin public trust, subjecting these diverse participants to regulation. Could the costs of complying with regulation be a barrier to entry for smaller firms? It is still early days, and while big techs process the bulk of transactions on UPI (Frost and others 2021), smaller fintech companies are gaining ground. Moreover, existing intermediaries and some fintechs account for the bulk of the source and the end points of funds transferred. The market continues to develop rapidly and, in the end, it is a question of striking the right balance between efficiency and stability.
A level playing field for data flows is necessary to ensure fair competition. There are concerns that big tech companies will be able to obtain financial data from banks and fintech providers but will not have to share their own non-traditional data, such as location, web browsing, or social media history. This remains outside the data-sharing regime but can still inform financial decisions such as credit assessments. Non-traditional data will be crucial as the India Stack eventually expands into processing insurance and even health data, which are beyond the scope of most of the world’s existing open banking frameworks.
Approaches such as the India Stack can support not just open banking but open finance as well, with synergies across banking, wealth management, insurance, and other products across the world.
China’s Digital Yuan Is Technocracy’s Dream Currency
China’s Technocracy is almost complete as it issues a digital, programmable currency where the location and ownership of each individual unit is recorded and monitored. It can also be selectively switched off for any reason. It is also rumored that China is stockpiling gold for a possible linkage to the digital Yuan. ⁃ TN Editor
Two weeks ago, we reported that one of the most remarkable “features” of the brand new and soon to be unrolled digital Yuan, which should not be confused with any account-based currencies or commercial bank, private or unbackstopped digital currencies…
… is that it will come with an expiration date. As the WSJ reported, “the money itself is programmable. Beijing has tested expiration dates to encourage users to spend it quickly, for times when the economy needs a jump start.”
That’s just the start.
While China’s digital yuan will have an uphill climb in seeking to dethrone the dollar as a global reserve currency – despite Beijing’s protests that it has no such ambitions – as it’s an electronic version of a currency nobody wants (for now), the new currency will allow Beijing to weaponize its currency response to its every growing roster of trade partners. As Bloomberg details, instead of challenging U.S. dollar dominance and neutralizing sanctions, “the digital yuan appears potentially more geopolitically significant as leverage over multinational companies and governments that want access to China’s 1.4 billion consumers. Since China has the ability to monitor transactions involving the digital currency, it may be easier to retaliate against anyone who rebuffs Beijing on sensitive issues like Taiwan, Xinjiang and Hong Kong.”
“If you think that the United States has a lot of power through our Treasury sanctions authorities, you ain’t seen nothing yet,” Matt Pottinger, former U.S. deputy national security adviser in the Trump administration, said last week at a hearing of the government-backed U.S.-China Economic and Security Review Commission. “That currency can be turned off like a light switch.”
As Michael Every summarizes in his Tuesday Global Daily, “good luck to multinationals heartily agreeing that decoupling is unwanted, as they try to straddle the US, and its growing thicket of USD sanctions wrapped around a human rights foreign policy focus, and China, with its Panopticon e-CNY that can be turned off to ensure US sanctions and human rights foreign policy have no power over it.”
Indeed, as Bloomberg confirms, so far China has mostly resisted hitting foreign firms in response to U.S. actions on companies like Huawei, holding off on releasing an “unreliable entity list” designed to punish anyone who damages national security. Any move to cut off access to the digital yuan would carry similarly high stakes, potentially prompting foreign investors to pack up and leave.
But, as the report notes, Beijing has recently gone after such major multinationals like H&M for statements on human-rights issues, even while government officials have been careful to avoid directly endorsing a boycott. In a Weibo post last month, the Communist Party Youth League declared: “Want to make money in China while spreading false rumors and boycotting Xinjiang cotton? Wishful thinking!”
There’s more: widespread adoption of the digital yuan – also known as the e-CNY – could give China’s central bank more data on financial transactions than the big tech giants, allowing the Communist Party to both strengthen its grip on power and fine-tune policies to bolster the economy. While cryptos seek to disintermediate the state from monetary transactions, a digital yuan would do the opposite and give the PBOC even more sway and minute control over every single transaction, while obliterating monetary anonymity entirely.
While that level of control may boost growth in the world’s second-biggest economy, it also risks spooking companies and governments already wary of China’s track record on intellectual property rights, economic coercion and rule of law.
So, while many have said that the US has a nuclear option in its escalating feud with China in the form of selective cancellation of Treasurys held by China (whether it will do so is a different matter entirely), China will soon have its own nuclear option.
Yet said option may well backfire: while President Xi has called for greater self-sufficiency in key technologies like advanced computer chips, such a financial decoupling from the U.S. would only hurt China’s economy and potentially leave the Communist Party more exposed to destabilizing attacks, according to BBG. After Xi effectively ended Hong Kong’s autonomy last year with a sweeping national security law, the U.S. refrained from cutting off the territory’s ability to access U.S. dollars due to the potential devastation to the global financial system.
China’s state-endorsed boycott of H&M shows “great commercial risk” for companies that use the digital yuan, Yaya Fanusie, adjunct senior fellow at the Center for a New American Security in Washington, told the U.S.-China Economic and Security Review Commission hearing. If foreign merchants had to use the e-CNY, he said in a separate email, the government could prohibit transactions with H&M wallets and the store could disappear from digital yuan apps.
“This is the other side of the coin — Beijing not as a sanctions evader, but more empowered to enforce its own financial muscle,” said Fanusie, who has written extensively on how central bank digital assets may impact U.S. financial sanctions. “China’s digital currency is as much about data as it is about money,” he added. Foreign firms that use the digital yuan “might end up handing over to the Chinese government lots of real-time data that it could not access efficiently through conventional banking technology.”
Ironically, it is China’s desire to have total monetary control that may prevent the continues adoption of its currency at the international level: as Bloomberg notes, China’s ability to see every transaction may make it difficult for foreign banks to use the digital yuan and still comply with confidentiality rules in their home countries, according to Emily Jin, a research assistant at the Center for a New American Security. Alternatively, the currency might appeal to some similarly ruthless, despotic, socialist regimes that prioritize control over privacy protection.
“They might find it easier to convince governments more authoritarian in their leaning that it helps monitor elicit activities or stop them quickly or stop them before they happen,” Jin said. “They aren’t going to market it to everyone.”
That’s right: if the e-yuan is proven to be a success, the US will rush to roll out its own digital dollar…
Programmable Money: China’s Digital Yuan Models Historic Technocracy By Embedding An Expiration Date
China’s new digital Yuan supports its blossoming Technocracy by including an expiration date. Technocracy in the 1930s proposed money consisting of an energy script that would automatically expire at the end of the allocation period.
Thus, the door is open to eradicate savings, inheritance and all wealth except for the oligarchs controlling the system. All transactions, along with all other identifiable information about the citizen, will be stored on a central computer at the Central Bank. It would make citizens permanent slaves of the state. ⁃ TN Editor
It’s been a long time coming, and now it’s almost here.
Fast forward a few months when China’s preparations to rollout a digital yuan gathered pace, and we reported in October that China was poised to give legal backing to the launch of its own sovereign digital currency, “cementing its trailblazer status in virtual currencies far ahead of other countries, after already recently experimenting with large-scale trials of actual payments by consumers, which was met with mixed results.” Specifically, the South China Morning Post reported that “The People’s Bank of China published a draft law on Friday that would give legal status to the Digital Currency Electronic Payment (DCEP) system, and for the first time the digital yuan has been included and defined as part of the country’s sovereign fiat currency.”
The design framework for the digital yuan had been released one year ago on the heels of Facebook’s ambitious but disastrous Libra token rollout after founding corporate partners split for lack of confidence in the project and on fears US federal regulators would seek to block it just as they did encrypted-messaging company Telegram’s Gram cryptocurrency.
“The draft law would also forbid any party from making or issuing yuan-backed digital tokens to replace the renminbi in the market,” the SCMP said.
This in turn brought us to the so-called “Shenzhen case study” when in October of 2020, China became the first nation to hold a trial run of its digital currency, when the government in Shenzhen carried out a lottery to give away a total of 10 million yuan (about $1.5 million) worth of the digital currency (nearly 2 million people applied and 50,000 people actually “won”).
The winners were required to download a digital Renminbi app in order to receive a “red packet” worth 200 digital yuan ($30), which they can then spend at over 3,000 designated retailers in Shenzhen’s Luohu district, according to China Daily. After that, they’ll be able to buy goods from local pharmacies, supermarkets and even Walmart.
The idea was to not only test the technology involved, but boost consumer spending in the wake of the COVID-19 pandemic. In short, China is not only subsidizing the centrally-planned economy by manipulating the supply-side of the question- it now can prop up demand by handing out digital currency to anyone (or everyone).
Of course, unlike traditional central bank account-based currencies such as reserves, or decentralized cryptocurrencies like bitcoin, China’s digital currency would be controlled by the country’s central bank and will be instantly made available at a moment’s notice to anyone who can receive it.
And since “China’s adoption of digital central bank tokens is expected to be seamless as most of the nation’s digital payments already pass through companies like TenCent and AliPay and are already very popular in the country”, we concluded that “the successful Shenzhen test means that a broad rollout is just a matter of time.”
Still, one thing was missing: a stamp of approval by the gatekeeper of not only the global payments system, but the protector of the dollar reserve system, SWIFT. But as two months ago, China got that too: as we reported in February, “SWIFT, the global system for financial messaging and cross-border payments, has set up a joint venture with the Chinese central bank’s digital currency research institute and clearing centre, in a sign that China is exploring global use of its planned digital yuan.”
Actually, not just “exploring” but thanks to year of testing and partial rollouts, Beijing was about to become the first country in the world set to launch the digital yuan, and with both the IMF’s and SWIFT’s blessing, we said that it was “just a matter of months if not weeks.”
While regular Zero Hedge readers are quite familiar with the details and chronology of China’s transition to a digital currency, which incidentally is precisely the opposite of a cryptocurrency and has absolutely nothing to do with Bitcoin, a fact which Peter Thiel may want to dwell on a little more next time before making sweep and wrong statements about bitcoin, the WSJ focuses more on the geopolitical reasons of China’s currency evolution – as a reminder, thousand years ago, when money meant coins, China invented paper currency, and now the Chinese government is minting cash digitally, in what the WSJ said is a “re-imagination of money that could shake a pillar of American power” – and specifically how to approach a decoupling from the global reserve currency, the US dollar so not only can Beijing avoid the “nuclear option”, a weaponized US dollar, but allow countries that the US seeks to punish like Iran, a viable alternative (remember, the enemies of China’s enemies – and none is bigger than the US – is China’s friend).Here is the WSJ:
The U.S., as the issuer of dollars that the world’s more than 21,000 banks need to do business, has long demanded insight into major cross-border currency movements. This gives Washington the ability to freeze individuals and institutions out of the global financial system by barring banks from doing transactions with them, a practice criticized as “dollar weaponization.”
The digital yuan could give those the U.S. seeks to penalize a way to exchange money without U.S. knowledge. Exchanges wouldn’t need to use SWIFT, the messaging network that is used in money transfers between commercial banks and that can be monitored by the U.S. government.
To be sure, a credible alternative to the dollar, reduces the need to hoard the currency for US trade partners which in turn would have profound implications on global saving patterns, from there, global capital flows. The consequences for the perpetual US current account deficit would be unprecedented.
In addition to realigining the global balance of monetary power virtually overnight, China’s the digital currency kills another bird with the same binary stone: it allows unprecedented surveillance and supervision over every single transaction.
[The digital yuan is] also trackable, adding another tool to China’s heavy state surveillance. The government deploys hundreds of millions of facial-recognition cameras to monitor its population, sometimes using them to levy fines for activities such as jaywalking. A digital currency would make it possible to both mete out and collect fines as soon as an infraction was detected.
A burst of cash-accumulation in China last year indicates residents’ concern about the central bank’s eye on every transaction. Song Ke, a finance professor at Renmin University in Beijing, told a recent conference that China’s measure of yuan in circulation, or cash, popped up 10% in 2020.
Then there are the myriad boosts to China’s ironclad capital controls:
While China hasn’t published final legislation for the program, the central bank says it may initially impose limits on how much digital yuan individuals can keep on their person, as a way to control how it circulates and provide users a dose of security and privacy.
To be sure, none of this is actually new as we have discussed all these nuances of the digital yuan before. What is now, is this blurb in the WSJ article:
The money itself is programmable. Beijing has tested expiration dates to encourage users to spend it quickly, for times when the economy needs a jump start.
And there you have it: the Keynesian wet dream to boost the velocity of mean finally comes true. For the past decade we have joked that it is only a matter of time before central banks slap on an expiration date on every monetary unit in circulation…
TN has covered the war on cash as a prime initiative of Technocracy. Technocrats cannot tolerate anonymity or lack of control over any segment of society. Thus, driving cash out of circulation and ultimately replacing it with a digital currency will force every human on earth to hook up to the “system”.
The only insulation against digital currency takeover if physically-held gold and silver, which is in shorter supply every year. The problem with this is that if you wind up spending your hard assets, you will eventually run out with no possibility to replenish them. ⁃ TN Editor
With so much news about an economic reopening, a border crisis, massive government spending and exploding deficits, it’s easy to overlook the ongoing war on cash.
That’s a mistake because it has serious implications not only for your money, but for your privacy and personal freedom, as you’ll see today.
Cash prevents central banks from imposing negative interest rates because if they did, people would withdraw their cash from the banking system.
If they stuff their cash in a mattress, they don’t earn anything on it; that’s true. But at least they’re not losing anything on it.
Once all money is digital, you won’t have the option of withdrawing your cash and avoiding negative rates. You will be trapped in a digital pen with no way out.
What about moving your money into cryptocurrencies like Bitcoin?
Governments Won’t Surrender Their Monopoly Over Money
Let’s first understand that governments enjoy a monopoly on money creation, and they’re not about to surrender that monopoly to digital currencies like Bitcoin.
Libertarian supporters of cryptos celebrate their decentralized nature and lack of government control. Yet, their belief in the sustainability of powerful systems outside government control is naïve.
Blockchain does not exist in the ether (despite the name of one cryptocurrency), and it does not reside on Mars.
Blockchain depends on critical infrastructure, including servers, telecommunications networks, the banking system, and the power grid, all of which are subject to government control.
But governments know they cannot stop the technology platforms on which cryptocurrencies are based. The technology has come too far to turn back now.
So central governments don’t want to kill the distributed ledger technology behind cryptos. They’ve been patiently watching the technology develop and grow — so they could ultimately control it.
Anyone who controls the money controls political power, the economy, and people’s lives.
Enter the central bank digital currency, known as CBDC…
Not Exactly Cryptos
CBCDs use the same underlying distributed ledger technology that cryptocurrencies use. But they’re different from cryptocurrencies like Bitcoin, although the differences are often overlooked by the crypto crowd.
Unlike cryptos, CBCDs aren’t new currencies. They’ll still be dollars, euros, yen or yuan, just as they are today. But these currencies will only be digital; there won’t be any paper money or cash allowed. Only the format and payment channels will change.
Balances can be held in digital wallets or digital vaults without the use of traditional banks. A blockchain is not needed; the CBDC ledger can be maintained in encrypted form by the central bank itself without the need for bank accounts or money market funds.
Their greatest appeal is their convenience and lack of credit card transaction fees. Payments can be done with an iPhone or other device with no need for credit cards or costly wire transfers.
Who needs bank accounts, checks, account statements, deposit slips and the other clunky features of a banking relationship when you can go completely digital with the Fed?
An individual Fed account on your mobile phone could also eliminate the 2.5% fees that merchant acquirers charge retailers to process credit card transactions. Payments, in general, would be faster, cheaper, easier and more secure than they are today.
The Federal Reserve has been working with scientists at the Massachusetts Institute of Technology to develop a dollar form of CBDC.
Big Banks Beware
The roll-out of this new digital dollar may still be a few years away, but the implications are enormous. There’s more at stake than just customer convenience.
Railroads were one of the largest sectors of the economy from 1870 to 1930 but were mostly bankrupt by the 1970s. General Motors has been rescued from bankruptcy more than once by the U.S. government.
General Electric was once an industrial giant and now is a shell of what it once was. Oil company stock prices have taken a beating from the threats of the Green New Deal. Things change.
Today banks and other financial institutions dominate stock market valuations alongside the tech sector. CBDCs may be coming for the banks.
A reaction to the proposed change has already begun. Major banks fear they will be completely cut out of the payments system. MasterCard and VISA are also concerned that their payment channels will be made redundant.
Trillions of dollars of wealth in the form of financial institutions’ stock prices for JPMorgan, Citi, MasterCard and VISA could be wiped out as the new digital payments technology takes hold.
You might not have much sympathy for JPMorgan, Citi, MasterCard and VISA, but what do you think would happen to the stock market if they crash?
That’s not the only potential fallout from CBCDs. There’s a dark side. If there is no cash, there is no anonymity.
Governments will know your whereabouts and habits at all times simply by tracking your use of funds through the CBDC payment system.
This can already be done, to some extent, by tracking credit card transactions, but the CBDC system will make state surveillance more pervasive.
China is leading the way with CBDCs. And this kind of surveillance is the real driving force behind the Chinese CBDC.
China already uses facial recognition software, mobile phone GPS tracking and the purchase of plane or train tickets to track their citizens. This surveillance can be used to detect anti-state activities and to arrest dissidents or anyone who doesn’t strictly follow government orders.
Now, China wants to take its CBDC rules and make them the global standard.
Even if the U.S. and Europe don’t agree, it’s likely that many Asian and African countries might agree in exchange for aid from China. That aid can take the form of access to scarce COVID vaccines, for example.
Once China’s totalitarian surveillance software is perfected, they can make it the standard for much of the world and facilitate intrusive 24/7 surveillance by every dictator and autocratic leader in the world.
No doubt China would arrange to have access to the same surveillance information it was providing to client states. The end game would closely resemble George Orwell’s dystopian novel, 1984.
If cash is gone, there is only one way to escape digital surveillance of wealth — physical gold.
How Big Banks Will Force Americans Into The Great Reset
The global banks will be the principal fulcrum to lever the world into the Great Reset, which is Technocracy, a resource-based economic system where oligarchs own everything and citizens own nothing. The pandemic was merely a rehash of Greta Thunberg stamping her feet to get people to panic over climate change. ⁃ TN Editor
In June 2020, elites from around the world gathered to announce the launch of a plan to “reset” the entire global economy, a proposal they ominously named the “Great Reset.”
Among the many world leaders and powerful institutions that pledged their support for the Great Reset at the June meeting were the International Monetary Fund, Prince Charles, the head of the United Nations, CEOs from major international corporations, and the World Economic Forum—one of the key ringleaders of the Great Reset.
“Every country, from the United States to China, must participate [in the Great Reset], and every industry, from oil and gas to tech, must be transformed,” wrote Klaus Schwab, the founder and executive chairman of the World Economic Forum, in an article published on WEF’s website. “In short, we need a ‘Great Reset’ of capitalism.”
The initial justification for the Great Reset was the COVID-19 pandemic, but from the start, supporters of the global economic overhaul repeatedly said that climate change was the long-term justification, the one that would allow a sustained, massive transformation of society. Doing nothing, they argued, would pose an “existential threat” to the human race—a completely ludicrous argument many on the left continuously make without a shred of solid scientific evidence to support the claim.
Among the most important figures in the Great Reset movement are gigantic financial institutions and/or their CEOs, including Bank of America and MasterCard.
Although many Great Reset supporters have called for dramatic expansions of government welfare programs, including job guarantees, government-provided health care, etc., the heart of the Great Reset is something called environmental, social, and governance (ESG) metrics.
ESG metrics offer public policy leaders, economists, investors, and banks an entirely new way of evaluating businesses. Instead of looking at how profitable a company is, how many employees it has, its business model, and other traditional metrics, ESG adds to those concerns a whole host of left-wing causes, including how “green” a company is, having the “right” ratio of minorities, whether a business is involved in politically disfavored industries (such gun manufacturing and sales), as well as other, similar considerations. Companies are then given a score or rating to determine how well they align with ESG goals.
Hundreds of the world’s largest corporations, including financial institutions, have already created ESG systems and reporting metrics within their companies, and investor groups worth trillions of dollars have pledged to prioritize these companies over those that refuse to participate.
ESG systems, sustainable investment, and forcing the world to adopt “green” energy sources are all essential elements of the Great Reset plan to transform the world. (I put “green” in quotes because there is ample evidence to show wind and solar energy are not even remotely environmentally friendly, as even left-wing documentarian Michael Moore now admits).
Parts of the Great Reset are theoretical and have yet to be put into place, but some components of the plan have already been rolled out or are now being put into place. One of the most important is financial institutions’ commitment to mandate that virtually all businesses in America adopt renewable energy.
In February 2021, Bank of America, citing its “longstanding support for the Paris Climate Agreement,” announced, “the company today outlined initial steps to achieve its goal of net-zero greenhouse gas (GHG) emissions in its financing activities, operations and supply chain before 2050.”
Note that the “net-zero greenhouse gas emissions” rule will be applied not only to Bank of America’s own operations and supply chain—meaning every company that does business with Bank of America—but also its “financing activities.”
Put more simply, if you want a loan from Bank of America in the future, you better toe the globalist line on climate change.
Of course, Bank of America isn’t the only bank with these policies. Wells Fargo CEO Charlie Scharf made a comparable announcement on March 8.
“Climate change is one of the most urgent environmental and social issues of our time,” Scharf said, “and Wells Fargo is committed to aligning our activities to support the goals of the Paris Agreement and to helping transition to a net-zero carbon economy.”
Citi, Goldman Sachs, Morgan Stanley, and JPMorgan Chase—which, together with Wells Fargo and Bank of America, make up the six largest banks in the United States—also made similar commitments.
IMF Calls For Internet Search History To Be Linked To Your Credit Score
Is the International Monetary Fund (IMF) trying to force China’s draconian Social Credit Scoring system on the entire planet? Who will decide what Internet “histories” are bad and which are acceptable? Google, which controls 95% of search engine traffic, is undoubtedly at the center of this. ⁃ TN Editor
Presenting their findings from a paper they wrote, the researchers argue that by using non-financial data, specifically “the history of online searches and purchases,” we can solve the problem of “certain kinds of people not having enough hard data (income, employment time, assets and debts) available.”
The authors of the piece claim that this move is a necessary innovation in order to compete with the rise of corporate cryptocurrencies such as the one in development by Facebook, who hope to launch next year. While Facebook is a monopoly that has engaged in political censorship, their power pales in comparison to that of the IMF . The International Monetary Fund is a veritable superpower with ties to the World Bank, and they oversee the entire global economy.
It should go without saying that giving this organization the power to track everyone’s search history can lead to some dark ramifications. With private banks, notably JPMorgan and Chase Bank, already kicking conservatives off of their services, one can only imagine how much this would escalate with the IMF tracking everyone’s search history. While there has been bipartisan opposition to the Chinese Social Credit system in Congress, the distinctions between that system and what the IMF is pushing for remains ill-defined.
The IMF, including some of the writers of the blog post, have ties to both the World Economic Forum’s Great Reset Initiative and the Joe Biden Transition Team. Two of the researchers advocating for the IMF tracing our search history, Luc Laeven and Lev Ratnovski, have pages on the WEF’s website. Lev Ratnovski, in particular, has defended bank bailouts so the economy can stay afloat.