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Digital Dollar Plans Leaked!

by Rachel MillsFebruary 29, 2024

Leaked documents suggest Congress is moving forward with "digital dollar" in spite of public denials

What could a digital dollar do to financial privacy?

...potentially destroy it, that's what. And though many legislative moves are being made to block a central bank digital currency, or digital dollar, new leaks suggest that behind closed doors, plans are moving forward.

First of all, what IS the digital dollar? A good explanation is HERE. In a nutshell, a central bank digital currency (CBDC) is a virtual currency, like a cryptocurrency, but backed and created by a central bank. Much of the appeal of Bitcoin is it is divorced from the Federal Reserve system and outside of its control. CBDCs are the exact opposite. Why should they make you nervous? Full economic control for the government.

Some things are just meant to be private.

Ever have that dream that you're in math class and you suddenly realize you forgot to put on pants that morning? Everyone is staring at you. You feel awkward and exposed. It’s an extremely uncomfortable feeling. That is how you could feel financially under a digital dollar regime.

The digital dollar will expose all financial transactions to whoever pulls the levers behind the curtain. All transactions would go through a digital ledger that the Federal Reserve controls and monitors. The implications and possibilities are staggering.

Financial privacy is a human right not because people necessarily have something to hide or are doing anything wrong. It's because some things are just private. You don't walk around with your salary and your credit score emblazoned on your name tag for the same reasons you wear pants to math class and everywhere else.

But it is more than that. They will have the capability to have full control over your dollars. Will your dollars be eligible to spend on a full tank of gas this week? Are you making the right choices at the grocery store or at a restaurant? CBDCs could potentially be used by central banks to manage and control spending in an economy in several ways. Here are a few examples:

Direct distribution: Central banks could use CBDCs to directly distribute money to households or businesses, as a way of stimulating spending and boosting the economy. This could be done through various channels, such as tax rebates, universal basic income programs, or other forms of government assistance.

Interest rates: CBDCs could be designed with interest rates that vary based on economic conditions. For example, if the economy is growing too quickly and inflation is a concern, the central bank could raise interest rates on CBDCs to encourage people to save more and spend less. Conversely, if the economy is sluggish and needs a boost, the central bank could lower interest rates on CBDCs to encourage spending.

Transaction limits: CBDCs could be designed with transaction limits that restrict how much money people can spend or transfer in a given time period. This could be used to control spending in certain sectors of the economy that the central bank deems to be risky or over-inflated.

Negative interest rates: CBDCs could also potentially be designed with negative interest rates, which would effectively charge people for holding onto their money rather than spending it. This could be used as a way of encouraging people to spend and invest, rather than "hoarding" their money.

These are hypothetical examples that are actively being discussed and are considered “features, not bugs” for those in power. The implications of these kinds of controls are staggering. Entire sectors of the economy could be shut off or hobbled with the flip of a switch. Certain people could have their money disabled, while others get their money doubled. The Fed could have us all by the nose. Would there be any due process?

There are potentially some crazy changes coming for the dollar and for the banking system in general. And, with the debt skyrocketing from unsustainable levels to even more unsustainable levels, the Fed and Congress might even feel backed into a corner on reforms like the creation of the digital dollar. It may start off as convenient and innocuous with assurances that these capabilities will not be abused. But down the road, who knows?

It may be impossible to opt-out of this sort of economy if you want to say, pay your mortgage or buy groceries. But you don't have to hold your entire net worth inside the dollar system. You can protect a portion of your nest egg and move some assets to precious metals - fully private, fully yours. Gold and silver are easy to buy, easy to sell and have never been worth zero. For 8,000 years of recorded human history, precious metals have functioned as money and still do in many important ways. They are tangible, unprintable and act as a hedge against inflation. They are what central banks and billionaires turn to when they need stability and underlying value. Are you balanced and diversified with assets outside the dollar?  Call us today to get started.

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