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Central Bank Digital Currencies Are Coming – What Will The Consequences Be?

July 14, 2022

This article was written by Brandon Smith and originally published at Birch Gold Group

Currencies are the lifeblood of trade and the economy; if a currency fails, the entire economy fails. Yet, most people rarely think about the health or buying power of the money in their pocket. People don’t research how often currencies actually falter and how common it is for inflation or stagflation to strike nations. They just assume that the money they have will be as useful tomorrow as it is today. They also assume that money will never change in a dramatic way.

This lack of interest in how money works is likely due to the fact that people are not taught how their money is created. It’s not discussed in schools, the truth is avoided in colleges and the mainstream news rarely mentions it. People think our government and treasury handles all of that, but the reality is that our government does NOT create our money; at least, it’s not in charge of the process. Central bankers are, and they operate from a “quasi-independent” position.

For example, former Federal Reserve chairman Alan Greenspan once openly admitted that the central bank “answers to no one” and does not follow orders from the government. They do what they want when they want.

This attitude should concern you because it is a long held argument among critics of the Fed that they are an unelected body with ultimate power to destroy the economy and the dollar at will if they want to. Sure, the US President gets to “choose” the next successive chairman, from a list of candidates that is given to him by the Fed, of course. And Congress could conceivably call for a full audit of the Fed’s financial actions and policies, but they never do because it would never be allowed by the banks or their political partners. The central bank is the most powerful institution in our nation by far. They are completely unaccountable and uncontrollable.

There is only ever the question of public reaction; this is the one thing the bankers fear. They are afraid that the public will learn who they are and what the central bank does. They are afraid that their actions and policies will anger the public enough to inspire rebellion. They are afraid that the torches and pitchforks will one day come out. So, they divert blame as much as possible for the damage that they cause.

Apologists for the Fed claim that the central bank only creates money from thin air when the government asks them to, and so it’s the politicians that are to blame. This is a lie. The politicians go begging to the Fed for more money, and the Fed usually obliges while also creating tens of trillions of dollars on the side for their friends in the corporate world.

For example, only ONE TIME in recent history has a Fed policy action been investigated by the Government Accounting Office. This audit was of a single set of bailouts enacted by the bank, and it was only allowed because the public was starting to get wise to the bank’s activities (thanks to Ron Paul’s presidential campaign). The audit was designed to shut people up. But, what was found was startling, and so the media swept the info under the rug. Over $16 trillion in fiat money had been conjured by the Fed in the span of a few years, while the original claim was that mere billions had been created for the bailouts starting in 2008.

Keep in mind that this audit was limited only to a particular set of bailouts; it was not a full audit of the Fed’s entire operation. We truly have no idea how many dollars the central bank has created out of thin air since the credit crash began. We can only reference the Fed’s own data, which is probably not very honest.

The only thing that limits central banks from total monetary dominion is the fact that physical dollar holdings and even digital bank transfers can be accounted for. Once those dollars are out in the ether there’s not much the central banks can do to hide them and eventually, inflation will reveal the truth.

The bankers need a new system which allows them total control of every single penny from creation to circulation. They want the ability to make money appear or disappear in real time. More than that, they want the ability to track every single dollar, including who has them and what they are using them for. They want to be able to micromanage trade, and thus achieve a financial totalitarian empire.

Enter Central Bank Digital Currencies (CBDCs) based on blockchain technology…

Ever wonder why the mainstream media has been hyping up cryptocurrencies like Bitcoin for the past few years? Ever wonder why major banks like Goldman Sachs and JP Morgan have been pumping billions of dollars into crypto infrastructure and research in private while at the same time bashing crypto in the news? Ever wonder why central banks have been dismissing crypto as dangerous while at the same time developing their own cryptocurrencies?

It is because they are easing the masses into the notion of a fully digital trade system in which physical money no longer exists. Central banks might act like they are suspicious of crypto – but in reality they LOVE it.

The Bank for International Settlements (BIS), also known as the “central bank of central banks,” recently released a survey which states that at least 81 central banks around the world have been accelerating plans to release their own cryptocurrencies. Many excuses are given, including the covid pandemic, but they were actually working on these digital products well before the pandemic began.

The International Monetary Fund (IMF) has been talking about developing a global cryptocurrency system tied to their Special Drawing Rights basket for years. Numerous globalist institutions have been pursuing the technology and it’s nothing new. What IS new, though, is banks openly admitting to the plan.

The BIS, one of the most clandestine globalist organizations that still has a public face, has even admitted that it is developing CBDC tech. And what this tells me is that we are very close to a sea-change in our economic environment. Generally, criminals will not reveal their criminality unless they think it’s too late for anyone to do anything about it. With stagflation hitting our economy hard this year we have to question if the behavior of the banks suggests much worse conditions to come?

The public would never readily accept CBDCs as money unless their existing money lost most of its buying power and the current system was in the gutter. This is how new levels of empire are born; a major crisis allows for the elites to consolidate control while the people are distracted by their own private disasters. The big picture is changed while each person is terrified by their own small picture calamity.

In the US, markets and mainstream economists are just praying that the Fed capitulates on interest rate hikes, because they think this would save stocks from collapse. However, even if the Fed did this there would still be the problem if inflation/stagflation. If they don’t back off of rate hikes (I predict they will not capitulate or reverse course anytime soon) then there will be recession on top of price inflation. There’s no way that the current speed of rate hikes is going to slow down inflation from tens of trillions of fiat dollars flowing through the global economy. As I’ve warned for a long time now, the Fed has created a Catch-22 scenario in which the economy crashes no matter which policy decision they make.

But what if this was all by design?

With the introduction of CBDCs in the wake of a stagflationary crash, the central banks could call for a new global network of currencies to “stop such a crisis from ever happening again.” The BIS and the IMF will be ready and waiting with the SDR basket, or something very similar. The bankers will remove all physical money over a short period of time and a global digital system will take over. All privacy in trade will be gone, except for those people involved in barter, black markets and commodities.

The advent of CBDCs could also mean that money and economic participation will become privileges, not rights. Digital trade could be tied to a social credit system, much like the one that exists in communist China.

Want access to your checking and savings accounts? Better not say anything critical of the establishment, or you could be reported by a neighbor or stranger by cell phone app and have your money disappear in seconds. The onus will then be on you to prove that you are “loyal” and get access back. You are guilty until proven innocent. Maybe you don’t want to take the next untested mRNA vaccine for the next dubious pandemic threat? You’ll have little choice if your ability to function economically is controlled digitally.

This is the world we are facing if we allow central banks to fully digitize money and trade. It is a nightmare environment of complete authoritarianism. The public at large is mostly unaware of the incredible danger inherent in CBDCs and they must be educated before the current crisis grows so large that they can no longer focus on anything other than their own problems.



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Brandon Smith

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  • Dan Lammon July 14, 2022 at 6:12 am

    “Digital trade could be tied to a social credit system, much like the one that exists in communist China.” The website gives a “reputation score” to everyone and encourages people to investigate the “reputation profile” of your friends, neighbors, relatives, and coworkers. They are getting us acclimated to a citizen scoring system.

    • laura ann July 15, 2022 at 2:59 pm

      Dan: they want you to join and pay dues, like other similar sites.

      • Dan July 18, 2022 at 3:51 pm

        Laura ann: I realize that. What is your point?

  • Abhid Menon July 14, 2022 at 8:17 am

    ” As I’ve warned for a long time now, the Fed has created a Catch-22 scenario in which the economy crashes no matter which policy decision they make.”

    Correct – that said it is very likely that they will reverse course by the end of Q3 2022 because the economy is in such a precarious position even small rises will lead to calamity.

    The bankers don’t want to appear like vandals and will pretend they are trying to help.

    So they will ruin the economy with (small) rate rises, and then revert to cuts, re-commence QE (probably not immediately) and pretend they tried to contain inflation but now are “helping” with stimulus.

    Of course this will just make inflation worse because that’s what money printing does. As stated, there is no winning outcome here.

    The key point is that the bankers have no intention of being the villain here – they got nervous in 2011 with the Occupy movement when people rightly aimed their anger at the bankers. So they aren’t going to keep up jacking rates when Wall Street and Main Street are throwing a tantrum and begging for assistance. My 2 cents.

    • Avatar photo
      Brandon Smith July 14, 2022 at 8:22 am

      No, they will continue to hike into 2023 because price inflation will continue to rise. There’s no reason for them to reverse. They don’t care about propping up the economy, they care about destroying it. There will be no new QE. They’ve already pumped out more than enough fiat to create the inflation they needed – now they need a stagflation crisis and employment collapse and that can only be accomplished through rate hikes. They will look like the villains regardless, but only to the people paying attention to their activities. Most people pay no attention and simply blame the guy in the White House – Hence Biden’s role as the punch drunk clown.

      • Abhid Menon July 14, 2022 at 11:11 am

        For sure, the Fed doesn’t care about saving the economy and indeed they want to harm it. But even tiny rate rises cause a lot of pain in the real economy and it is already squealing.

        Time will tell where they take rates to, but I doubt we have seen the back of QE. The US dollar has to be taken down and more QE will help that objective come true. I could easily see the balance sheet doubling to 20 trillion before the end of 2024. And I do believe they will reflate the stock market not only to pretend they “tried to save us” but because of tax receipts. Such a large percentage of tax receipts depend on the level of the stock market and the government runs a huge deficit even with current record tax receipts.

        The government spends 70% of these record tax receipts on entitlements, 25% is interest expense (which will get higher as rates rise) and then there is the US military expenditure.

        So we are talking ~120% of tax receipts being spend just on these items. Can anyone seriously see them cutting any of these big three items? I doubt it. This means the government is going to have to borrow a load more.

        Without an artificially high stock market the budget deficit will widen even further and with the foreign bid for US treasuries drying up the govt will have to issue trillions of bonds. Who will buy them? It’s going to have to be the Fed.

        That’s why I believe they will do an about turn, monetize an enormous amount of debt and stick it on their balance sheet, ie print the lot.

        Whoever is right, one thing will definitely be delivered: stagflation.

      • Michael July 15, 2022 at 7:07 am

        i agree Brandon… what is different this time is they are Not reporting all the job losses in the Real Estate and Mortgage Markets…or at least up till today…. i have been a mortgage broker for 27yrs here in Ca… there has been so many job loses all over the industry… very good paying jobs! that is a lot of $$$ lost to spend on Food, Rent, Mortgage payments, auto loans etc… Realtors, Mortgage Lenders, Title, Escrow, Appraisers, Notary’s, etc. etc. All Gone! They are going to collapse the whole economy while raising rates! They will “look” like they are the good guys trying to fight Inflation…. for now! but your right.. most people are so dumb down they can’t see it…

        I do have to admit, the same thing happened when Trump took office regarding mortgage rates… they went up, crashed the mortgage market really and then reversed course… this time, rates have gone higher and faster… i see another year of rate increases… they want their Great Reset!

        • Gauntlet33 July 15, 2022 at 12:36 pm

          I agree. My brother’s a realtor here in CA and I doubt he sees the writing on the wall that the RE industry will be killed with extremely few realtors able to survive working full-time as realtors.

      • Austrian Peter July 17, 2022 at 1:41 am

        I agree Brandon and suspect this is the route the CBs are taking in compliance with the WEF Great Reset. Larry Fink said so in October 2019, just after the Repo crisis, and offered “Going Direct”

        But what does he mean by this policy? Is it possible that the CBDCs/SDRs will act very much like the ECU and be used only for international trade and settlement leaving domestic currencies intact? I write about this subject every week so readers might get an understanding of the complexities of Venetian Banking System of the 17th century:

        Have we been frightened by the Chinese social credit system which is a reality and we fear our politicians copying them?

  • Serge July 14, 2022 at 8:39 am

    ECB Christine Lagarde, then head of the IMF, spoke about the global digital currency in Singapore (you mentioned her speech in one of your articles, I think). I quote her:
    “What role will cash play in this digital world? Already signs in store windows read “cash not accepted”. Not only in Scandinavia, the poster child for a cashless world. In many other countries, too, the demand for cash is falling, as recent IMF research shows. And in ten, twenty, thirty years, who will still be exchanging bits of paper?”, in:

  • Daniel H July 14, 2022 at 9:01 pm

    I suspect the looming food crises are part of the plan to force CBDCs on the population – pushing people into desperation so they’ll accept any relief which will just so happen to require opening a CBDC account. Another thing they love about CBDCs is it’ll allow them to take interest rates negative which will be a whole new level of hell.

  • drhooves July 15, 2022 at 4:10 am

    As far as control goes, .gov already has a pretty firm hold on the old and the poor, through Medicare, Medicaid, Social Security (earned retirement and disability) and the EBT program. It appears to be a relatively easy transition during an economic crisis to convert and add to those programs with a CBDC. Imagine a manufactured crisis that freezes retirement accounts and mandates conversion to a digital government bond. I’m not sure the sheeple are awake enough to prevent that, should it begin any time soon.

    A possible side effect of an economic decline/collapse that delivers the Great Depression II could be that many wouldn’t have access to the Internet or electric grid to be able to use a CBDC. At least, not from their homes, like we can access banks today. This could make it worse if you have to go report to a separate government building like the post office or library to sign in online to get your next ration of government cheese.

    One way to combat this would be to set up an extensive bartering system at the local level, which I believe you’ve detailed before, Brandon. Need to work on those right away!

  • tuesdayisotlentgreenday July 15, 2022 at 7:11 am

    Sad situation if it comes to being the bankers choice. .. But, things do not work without elect grid.

  • JorJorWell July 15, 2022 at 5:06 pm

    What will YOUR CBDC classification be? – ‘Common’? ‘Restricted’? ‘Quarantine’?
    Probably won’t be ‘Sovereign’ – that’s reserved for celebrities, the media, politicans.
    An iside look at the software:

    • wappy-john July 18, 2022 at 11:41 am

      I saw this nonsense. This is fake. As a software engineer, I can tell you this “software” shown in the video and other places is just way too simplistic to actually be THE software, if there is any such software.

      This will only fool non-tech people.

      • woody188 July 20, 2022 at 11:47 am

        One never knows. The Amero looked too stupid to be real too, but it was real and was cancelled. That could have been when they decided it had to be all electronic. We’ll never know.

  • That thing July 16, 2022 at 5:42 pm

    “””The public at large is mostly unaware of the incredible danger inherent in CBDCs and they must be educated””””

    That what Bitcoin was all about. It was a great way to fleece the sheep with an “unregulated” “coin”, that way they will run to one protected by “government”.

    The stupidity is limitless….

  • nick July 17, 2022 at 4:24 am

    I was living in Greece in 2000 when their currency (Drachmae) was converted to the Euro. I was amazed at how easy it was to convert Europe’s oldest existing currency into a brand new currency in just 30 days. They announced that the “old” currency would be invalid after a certain date which forced all of the cash held privately into the new system. Way too easy!

    If I had to guess I’d say we’ll see a false flag cyber attack on the banking system to be blamed on Russia of course. Then pols will all scream “act of war” rhetoric while pushing the conversion to digital. Once they get the authorization they’ll probably just announce a “cash dollar expiration date” after which cash will no longer be accepted.

  • Roy July 17, 2022 at 7:01 am

    President Andrew Jackson was correct about the actions of all central banks, they like wars. Read his Farewell Address on the internet

    • woody188 July 20, 2022 at 11:57 am

      Excellent reference. I truly believe he is only on the twenty USD as an insult. The man himself would never have approved of something like the Fed. I can picture him chasing Jamie Dimon with an axe. Makes me smile.

  • Daniel V July 20, 2022 at 7:19 am

    Even though I only recently became aware of bitcoin 2 years ago, I always feel disturbed for the lack of a better word on how not only the alternative media singing it’s priase but also the mainstream media are slowing beginning to heavily promote it. It only came into fruition back in 2012 but the push for it only just recently accerlerated. I see bitcoin (and block chain technology as a whole for that matter) as a complete con scheme. The false notion that it’s decentralized is extremely laughable knowing basically almost every single thing within the internet is track. Why would block chain be any different? One switch of the power grid and boom, the entire so called decentralized blockchain goes away. Even for some miracle that it doesn’t go away, the feds regardless will ban any decentralized technology, as it goes against their agenda. This wouldn’t be such a big deal either if the other half of the alternative media wasn’t constantlly shrilling for a technology piece that could potentially be every civillian’s demise. I wonder about if all the crypto fanatics will ever wake up from the writings on the walls and accept they’re being dumped.

    • woody188 July 20, 2022 at 12:01 pm

      Wise synopsis. I agree. I was thinking about joining the fray when they forked it. That told me all I needed to know. They can just fork to infinity, so it’s no different than any other fiat. No intrinsic value. Might as well be trading digital weapons and items in Evercrack. (That’s an old MMORPG, or online video game, for you young and old folks.) Cheers!

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