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Before I show you what I’ve learned about a plan to seize control of America’s money, let me make one point clear…

If you value sound money and political freedom… if you value limited government and taxation with representation… and if you value enterprise and privacy… then you’re going to hate the future I’m about to describe.

There is no philosophical or monetary middle ground on the issue.

You’re either with it or against it.

The Chicago Plan

In March 1933, Henry Morgenthau Jr., chairman of the Federal Farm Board, was sent a short memo titled, “Memorandum on Banking Reform.”

It was signed by Frank Knight (the acknowledged author of the memo), Garfield Cox, Aaron Director, Paul Douglas, Lloyd Mints, Henry Schultz, and Henry Simons. All of them were professors at the University of Chicago.

The memorandum advocated for full-reserve banking (FRB) in the U.S. monetary system. U.S. currency would be backed only by government debt, not bank debt (loans issued by commercial banks to private citizens and companies).

It wouldn’t nationalize the U.S. banking system. But it would nationalize the nation’s money supply.

Under this kind of system, banks could no longer “create” money by lending it into existence. Money creation would be the exclusive territory of the government of the United States.

In this system, the key government agencies could not create money through new lending. They would do so through new spending (on priorities determined by elected politicians).

They called it “The Chicago Plan.”

The most radical elements of the plan – which we’ll discuss shortly – were left on the shelf nearly a century ago.

But I believe it’s about to find a resurgence in modern America…

…click on the above link to read the rest of the article…

Ron Paul: “A Cashless Society Is Very, Very Dangerous”

June 6, 2018

Ron Paul: “A Cashless Society Is Very, Very Dangerous”

As the global war on cash continues to accelerate, outspoken libertarian Ron Paul summarizes the effort to eliminate cash perfectly – as an “attack on individual freedom.”

Restricting and discouraging the use of cash, suggests Paul, has always been a goal of statists as a means to reduce individuals’ independence.

“A cashless society is very, very dangerous,” continues Paul.

Watch the complete interview, which includes an extensive discussion of economic issues and the Federal Reserve, here:

In September of 2015, Paul further discussed the war on cash at the Ron Paul Liberty Report with Joseph Salerno, a professor of economics at Pace University. Watch that interview here.

So we know how is hurt by the cashless society, consider just who is gaining from this war on cash.

The banks, of course, are charging as many fees as they can think of. More importantly, your cash card leaves a wide data trail detailing your buying preferences, used by merchants and advertisers to entice you into more buying. How convenient. These thoughtful companies even offer reward points every time you use the card. Cash offers the ultimate in privacy. Your cash card might as well be a walking billboard.

The government, of course, is extremely interested in your spending habits. The taxing authorities use an electronic money trail to monitor your spending and ensure against tax evasion. In addition, cards save the government the cost and trouble of printing and storing additional currency.

Your electronic purchase trail is nirvana to large corporations. Knowing your spending habits allows them to customize their ads to an ever-larger consumer base. They know what you need before you do and are ready to entice you with specials, sales and “act now” deals.

Visa Goes Down in the UK, Chaos Ensues, Cash is Suddenly King

June 3, 2018

Visa Goes Down in the UK, Chaos Ensues, Cash is Suddenly King

War on Cash Suffers Setback.

For over 12 hours on Friday, shopping centers in the UK and other parts of Europe were plunged into chaos as millions of consumers were unable to use their Visa debit or credit cards at points of sale. The credit card company, which was finally able to restore normal service early Saturday morning, said it had no reason to believe the hardware failure was due to “any unauthorized access or malicious event”.

While the mayhem caused by the outage may have been short lived, it served as a stark reminder of the risks, both for consumers and retailers, of depending purely on cashless payments. In the UK, the chaos unleashed was particularly acute since it is one of the world’s most cashless economies, pipped to the post only by Canada and Sweden, as a recent study by industry analysts reported.

In 2017, cards overtook cash for retail payments in UK for the first time ever, according to figures from the British Retail Consortium. According to Visa, payment processing through its systems accounts for a staggering £1 in every £3 of all retail spending in the UK. Which is why, when those systems stopped working yesterday, the chaos was greater in the UK than almost anywhere else as cashless customers missed trains, were unable to fill up their cars, pay for their groceries, or even clear their bar tab — this was Friday, after all!

“There is never a good time for the payments system to go down but a Friday afternoon, when there is a flood of people leaving work, must be among the worst,” one banking industry source said. The only way for people to pay for stuff was with co-branded Mastercard cards, or hard cold cash. Luckily, Visa cards were still working at ATMs, although the queues were considerably longer than normal.

…click on the above link to read the rest of the article…

Australia Bans Payments Over $10k, Unleashes “Mobile Strike Teams” In War On Cash

May 10, 2018

Australia Bans Payments Over $10k, Unleashes “Mobile Strike Teams” In War On Cash

As Australia struggles to maintain its unprecedented 104-quarter-long streak of uninterrupted economic growth, lawmakers are intensifying the country’s “war on cash” – ostensibly part of a crackdown on “criminal gangs” that are smuggling drugs and/or people into the island nation and companies that are trying to cheat their taxes.

To wit, Australia’s government has introduced an economy-wide payment limit of $10,000 for transactions conducted in cash, which, according to News.au, will help (in the aussie slang) “keep dishonest tradies and businesses from rorting the system by taking cash in hand.”

From July 1, 2019, cash payments of more than $10,000 made to businesses for goods and services will be banned as the Turnbull Government seeks to crack down on the $50 billion “black economy.”

The law was purportedly inspired by instances of large purchases – yachts, sports cars and other luxury items – being made in cash and the tax not being reported.

Perhaps the most – um – striking element of the proposal is the introduction of “mobile strike teams” to catch businesses engaging in the act of conducting an illicit cash transaction.

Treasurer Scott Morrison said the Black Economy Standing Taskforce will be beefed up to detect people making sneaky cash transactions through a rigorous identification system and “mobile strike teams”.

A black economy hotline will also be set up to allow people to dob in anyone who may be cheating the system.

“Cash provides an easy, anonymous and largely untraceable mechanism for conducting black economy activity,” the response said.

“Cash payments make it easier to under-report income and avoid tax obligations. This allows businesses transacting in cash to undercut competitors and gain a competitive advantage.”

Meanwhile, Australia’s federal law enforcement are setting up a hotline for people to call in and “dob on their neighbors” who are violating the cash payments rule…

…click on the above link to read the rest of the article…

“Ice Nine” Comes to China

April 23, 2018

“Ice Nine” Comes to China

The war on cash has been going on for decades. The U.S. abolished the $500 bill in late 1969. (The old $500 bill featured a portrait of President William McKinley, by the way. I remember seeing a few when I was a kid.)

Today’s $100 bill is only worth 10 cents on the dollar compared with the $100 bill of 1969.

Europe will abolish the 500 euro this year. We all recall what happened in India in late 2016 when India abolished the 500 and 1,000 rupee notes (worth about $10 and $20, respectively); there was mass chaos as peasants lined up to turn in the old notes for digital credit.

ATMs were shut down because the replacement notes were too big for the ATMs!

Now the war on cash is being taken to a new level. China, the world’s most populous country and the world’s second-largest economy, has said that physical cash may soon become obsolete.

China has huge digital payments platforms developed by their own companies Tencent and Alibaba, in addition to traditional credit and debit cards and mobile phone payments.

Movements like this might start slowly, but they gain momentum and end quickly. Cash can be expensive to handle because vendors have to hire armored cars to move it, buy machines to count it, pay premiums to insure it and risk losses due to theft.

Those costs only make sense if they can be spread among a high volume of cash. Once cash usage falls below that critical threshold, the handling costs per unit are too high and merchants quickly abandon cash altogether.

China may be getting close to that tipping point, and will get there sooner if the government pushes cash off the ledge by regulation.

This is consistent with the Communist plan for total control of their people.

…click on the above link to read the rest of the article…

In The Rush Toward A Cashless Society, The Poorest Are At Risk Of Further Exclusion

April 4, 2018

In The Rush Toward A Cashless Society, The Poorest Are At Risk Of Further Exclusion

“Unless you’re poor, it’s hard to understand what it’s like to be poor.”

Indian Prime Minister Narendra Modi has a grand ambition to make his country into a cashless society. In 2014, he launched a scheme to provide bank accounts to the nearly 40 percent of the population with little or no access to financial services. In November 2016, he withdrew 500 and 1,000 rupee notes ($7.80 and $15.60), the country’s two most common banknotes, from circulation.

The aim was to clamp down on black-market money and get more people into the formal economy, but it had a negative effect on the poor, with micro and small-scale service businesses cutting 35 percent of staff in the first few months, and some families left unable to afford fruit and vegetables.

Cash is on the decline worldwide; non-cash transactions grew 11.2 percent globally in 2015. But for some, the Modi experiment is a sign that cashless societies will hurt the poor, and India is not alone in having poor, unbanked populations. An estimated 7 percent of American households don’t have access to bank accounts, according to the most recent survey from the Federal Deposit Insurance Corp. And a government study at the end of last year found that the U.S. homeless population had risen for the first time since 2010. Given rising inequality, what happens to those on the margins of the economy when cash is no longer king?

Proponents of a shift away from cash often point to Kenya or Sweden as proof that such a transition can happen without further disadvantaging the poor. In Sweden, which is on track to be the world’s first cashless society, a magazine called Situation Stockholm has equipped its homeless sellers with credit card readers. And M-Pesa, a mobile money service first rolled out in Kenya, has 30 million subscribers and has been credited with raising 2 percent of Kenyan households out of extreme poverty.

…click on the above link to read the rest of the article…

Even the World’s Most Cashless Nation Doesn’t Want to Go Fully Cashless

March 28, 2018

Even the World’s Most Cashless Nation Doesn’t Want to Go Fully Cashless

It’s too risky and systematically excludes the most vulnerable people.

There are small but growing signs that Europe’s “War on Cash” is not going exactly according to plan. First, a number of central bankers began voicing concerns about its potential ramifications. Now, even in Sweden, the first European country to enlist its own citizens as largely willing guinea pigs in an economic experiment — negative interest rates in a cashless society — public support is beginning to waver.

Initially, the plan was so successful that by 2017 the amount of cash in circulation had dropped to the lowest level since 1990 and was more than 40% below its 2007 peak, earning Sweden a reputation as the world’s “most cashless nation.” The declines in 2016 and 2017 were the biggest on record. An annual survey by Insight Intelligence found that in 2017, only 25% of Swedes paid in cash at least once a week, down from 63% just four years before; and 36% never used cash at all, or just pay with it once or twice a year.

But that doesn’t mean everyone is on board. In a recent survey, an overwhelming 68% of the respondents stated that they would not like to live in a fully cashless society. The survey, commissioned by Bankomat AB, an ATM chain company representing an alliance of Swedish banks that admittedly has a vested interest in preserving cash’s role as a means of payment, polled over 2,000 people aged 18-65.

Opinions differed markedly between age groups but in no single demographic was there a majority in favor of abolishing physical currency. Among the 18-29 year old respondents 56% declared that they still want to keep cash while 38% said they would welcome a cashless society. Among the survey’s oldest demographic, the 65-year-olds, 85% wanted to keep cash.

…click on the above link to read the rest of the article…

The Way to Survive Hyperinflation

March 22, 2018

The Way to Survive Hyperinflation

COMMENT: Mr. Armstrong; I just wanted to comment that I am from Venezuela. My father came here to visit me in Florida where I live with a Green Card. Everything he saved in life for his retirement is now worthless and it does not even pay to travel back to collect his pension. The hyperinflation is a collapse in the confidence of government as you have explained. Those who saved for their retirement and had pensions, lose everything. They will be paid the amount that they were promised, but it will not even buy a single night’s dinner and soon a beer.

Thank you for your contribution to society. I wish more people would listen to you. Experience is the root of knowledge. Opinion is the root of bias. You have proven that

REPLY: To survive hyperinflation requires the holding of tangible assets and never cash or pensions. The way pensions can be devalued is through inflation over the course of time and circumstance. What I paid into Social Security will never come back to me in terms of real purchasing power and that is without hyperinflation. I have stated before, I met with the Treasury back during the Reagan Administration and said these insane levels of interest rates will triple the national debt in less than 10 years. They simply responded; Yes but we will be paying back with cheaper dollars.

All promises of government are simply eroded with inflation. That is why Southern Europe fell into such chaos. The currency doubled instead of declining when they joined the Euro. That is why Europe has been a failure under this political-economic philosophy. The Euro first crashed, and then doubled in value. Southern Europe was used to inflation always reducing their debts. Suddenly, their debts doubled and deflation ruled. And people cannot figure out why the Euro is in such trouble?

I do like your saying though. It is spot on.

Repetitive Patterns in the Money Supply – Will Coins Become Extinct?

March 15, 2018

Repetitive Patterns in the Money Supply – Will Coins Become Extinct?

Inflation over time raises the cost of raw metal and we see that such coins vanish from the money supply. Britain is the latest in line to eliminate the 1 & 2 pence coins. They are costing more to produce than they are worth. I have written about the monetary reform Act of 1857 when the penny was drastically reduced in size. Canada eliminated the penny as well.

The United States dropped copper from the penny in 1982. Today, the penny is made of 97.5% zinc. It is copper-plated to give the appearance that it is still really copper. Throughout history, the supply of copper, gold, and silver, have all risen and fallen at different times based on their own cycle. Where the Persians had excess gold, the Greeks only had silver mines. The Romans had neither silver nor gold and began their monetary system with bronze.

We can see how the three empires began with gold, then silver, and finally bronze and modern society turned to paper starting with the Chinese during the 13th century. The main coin of the Persians was known as the gold Daric, whereas the dominant coinage among the Greeks was the silver Athens tetradrachm known as the Owl. The Romans were the last to depart from the Bronze Age. Their coinage remained bronze until silver was introduced and struck in Greek denominations beginning in 280BC, which was just one 51.6-year wave from Alexander the Great (336-323BC).

As-Decline (1)

We can see the same process of the rising cost of copper that prevailed during the early Roman Republic. The Roman As drops from 280BC with a weight of 341 grams to 10.6 grams by the time of Augustus (27BC-14AD). The drastic decline was been 280BC and 115BC, which was about 19 waves of 8.6-years.

…click on the above link to read the rest of the article…

The Two Janet’s And The Perfect Storm Ahead

March 3, 2018

The Two Janet’s And The Perfect Storm Ahead

The Bloomberg news crawler this morning is heralding the heart of our thesis: Namely, that “flush with cash from the tax cut”, US companies are heading for a “stock buyback binge of historic proportions”.

This isn’t a “told you so” point. It’s dramatic proof that corporate America has been absolutely corrupted by the Fed’s long-running regime of Bubble Finance. Undoubtedly, the C-suites view the asinine Trump/GOP tax cut not as a green light to invest and build for the long haul, but as manna from heaven to pump their faltering share prices in the here and now.

And we do mean a gift just in the nick of time. The giant Bernanke/Yellen financial bubble is finally springing cracks everywhere, putting corporate share prices and executive stock option packages squarely in harms’ way.

So what could be more timely and efficacious than an enhanced, government debt-financed wave of stock buybacks to rejuvenate the speculative juices on Wall Street and embolden the robo-machines and punters for another round of buy-the-dip?

Indeed, corporate stock buying is now cranking at a $1 trillion annual rate or nearly double the rate of the last several years. That huge inflow of cash and encouragement to Wall Street will undoubtedly break the market’s fall in the short-run; and over the next several quarters, perhaps, enable an extended stop-and-start stepwise decline rather than a sudden sharp plunge as in the fall-winter of 2008-09.

It also underscores why the Paul Ryan school of conservative policy wonks got it so wrong on the corporate rate cut. They still dwell in a pari passu world where higher after-tax rates of return would, in fact, stimulate increased investment, growth, employment and income.

…click on the above link to read the rest of the article…

Silicon Valley Joins War On Cash: Tim Cook Seeks “Elimination Of Money”

February 27, 2018

Silicon Valley Joins War On Cash: Tim Cook Seeks “Elimination Of Money”

Apple CEO Tim Cook has one big hope for the future – that he lives to see the end of money.

“…I’m hoping that I’m still going to be alive to see the elimination of money.”

Speaking at a meeting for Apple shareholders in Cupertino, California earlier this month, Cook made it clear that he is firmly on the side of the war-on-cash establishment.

“Because why would you have this stuff! Why go through all the expense of printing this stuff and then some people steal it, and you’ve got to worry about counterfeits and all these things,” he continued.

As Apple’s CEO talked about the downsides of cash, BI reported that he became more animated, revealing his real passion about the topic…

“We can provide a solution for the customer that’s simpler, more convenient, you don’t carry around a wallet with a bunch of cards in it, or a purse with a bunch of cards in it,” Cook said.

“And it’s more secure, if you’ve ever had your credit card ripped off, I’m sure a lot of you have, I have, it’s not a good experience.”

Until now, it has tended to be politicians and central bankers leading the call for a cashless society… for your own good.

The enemies of cash claim that only crooks and cranks need large-denomination bills. They want large transactions to be made electronically so government can follow them. Yet these are some of the same European politicians who blew a gasket when they learned that U.S. counterterrorist officials were monitoring money through the Swift global system. Criminals will find a way, large bills or not.

…click on the above link to read the rest of the article…

“Cash Must Not Be Made the Scapegoat”

February 23, 2018

“Cash Must Not Be Made the Scapegoat”

In the War on Cash, a rare defense of physical money by an ECB Board Member.

The proposed EU-wide cash restrictions could come into effect as early as this year. But defenders of physical cash have an unexpected ally in their struggle: Yves Mersch, a member of the European Central Bank’s executive board. In a speech hosted by the Bundesbank last week, the Luxembourgian central banker exalted cash’s value as legal tender and heaped scorn on the oft-heard argument that its anonymity only helps criminals.

“Protection of privacy matters to all of us. Privacy protects people from the risk of a surveillance state and thought police,” he told his audience. “No particular link can be established statistically between cash and criminal activities. The focus must be on the fight against crime. Cash must not be made the scapegoat.”

One of the world’s biggest issuers of notes and coins, the Bundesbank was a fitting location for a speech on the virtues of physical money. In total, €592 billion of the €1.1 trillion of banknotes in circulation at the end of 2016 were issued by the Bundesbank.

Judging by recent statements, the Bundesbank wants to preserve this arrangement. Bundesbank president Jens Weidmann, who is hotly tipped to replace Mario Draghi as ECB president in 2019, has warned that it would be “disastrous” if people started to believe cash would be abolished — an oblique reference to the risk of negative interest rates and the escalating war on cash triggering a run on cash.

That didn’t stop five national governments — Cyprus, Bulgaria, Belgium, Portugal and Denmark — from approaching the ECB last year to consult on measures to limit the use of cash, according to Mersch. Meanwhile, Sweden is widely regarded as the most cashless society on the planet.

…click on the above link to read the rest of the article…

Don’t Worry, It’s Only a “Pre-Bubble”

February 23, 2018

Don’t Worry, It’s Only a “Pre-Bubble”

Ray Dalio, who embarrassed himself saying “You’re Going to Feel Pretty Stupid Holding Cash” offers more silliness.

Ray Galio, the head of the world’s largest hedge fund says U.S. in a ‘Pre-Bubble Phase’ with a 70% Chance of Recession.

“I think we are in a pre-bubble stage that could go into a bubble stage,” the hedge-fund manager said during a Harvard Kennedy School’s Institute of Politics on Wednesday.

Dalio’s recession comments echo remarks he has made over in a LinkedIn post, where he wrote that “the risks of a recession in the next 18-24 months are rising.”

“Stupid to Hold Cash”

Despite his recession call, Dalio is the same person who told the crowd at Davos, ‘If You’re Holding Cash, You’re Going to Feel Pretty Stupid’.

Dalio is also a believer in the sideline cash theory and that we may see a “Minor Correction“.

In a LinkedIn article following the VIX-related plunge, Dalio said We’ve Just Had a Taste of What the Tightening Will Be Like.

The headline sounds bearish, but the message sure isn’t, as the key paragraph explains.

“Still, these big declines are just minor corrections in the scope of things, there is a lot of cash on the side to buy on the break, and what comes next will be most important.”

Inundated With Cash

In the CNBC interview, Dalio also spoke of sideline cash.

“There is a lot of cash on the sidelines. I don’t mean just investor cash. I think banks have a lot of cash. Corporations have a lot of cash. So we are going to be inundated with cash.”

Sideline Cash Rebuttal

…click on the above link to read the rest of the article…

Swedish Authorities Fear “Negative Spiral” As Society Goes Cashless ‘Too Fast’

February 21, 2018

Swedish Authorities Fear “Negative Spiral” As Society Goes Cashless ‘Too Fast’

In 1660, Sweden’s Riksbank was the first central bank in the world to issue paper currency.

In 2016, Sweden began to accelerate its transition from cash to digital currency.

At the time, Deputy Riksbank Governor Cecilia Skingsley warned:

“We need to do the homework because it’s not an option for the public sector to stay on the sidelines and see the private sector cut off access to central bank money for individuals.”

A year later, in 2017, cash in circulation was plummeting and establishment economists celebrated the battle in the war on cash.

Additionally, Riksbank was actively looking toward cryptocurrencies as potential government-backed money.

But now, in 2018, Swedish officials are worried that too much (or too little in this case) is a bad thing warning:

“If this development with cash disappearing happens too fast, it can be difficult to maintain the infrastructure” for handling cash.

As Bloomberg reports, Sweden is widely regarded as the most cashless society on the planet. Most of the country’s bank branches have stopped handling cash; many shops, museums and restaurants now only accept plastic or mobile payments.

But there’s a downside, since many people, in particular the elderly, don’t have access to the digital society.

“No cash accepted” signs are becoming an increasingly common sight in shops and eateries across Sweden as payments go digital and mobile.

Last year, the amount of cash in circulation in Sweden dropped to the lowest level since 1990 and is more than 40 percent below its 2007 peak. The declines in 2016 and 2017 were the biggest on record.

But the pace at which cash is vanishing has authorities worried.

“One may get into a negative spiral which can threaten the cash infrastructure,” Mats Dillen, the head of the parliamentary review, said.

“It’s those types of issues we are looking more closely at.”

…click on the above link to read the rest of the article…

‘No Cash’ Signs Everywhere Has Sweden Worried It’s Gone Too Far

February 19, 2018

‘No Cash’ Signs Everywhere Has Sweden Worried It’s Gone Too Far

Cash usage declining both as share of GDP and in nominal terms
Riksbank committee could publish report on issue in summer

Sweden ‘Most Cashless’ Society in the World

The value oof notes and coins in circulation are the lowest in nearly 30 years. Bloomberg’s Amanda Billner reports.

“No cash accepted” signs are becoming an increasingly common sight in shops and eateries across Sweden as payments go digital and mobile.

But the pace at which cash is vanishing has authorities worried. A broad review of central bank legislation that’s under way is now taking a special look at the situation, with an interim report due as early as the summer.

Going Cashless: Bad for Tax Cheats, Privacy, the Poor: QuickTake

“If this development with cash disappearing happens too fast, it can be difficult to maintain the infrastructure” for handling cash, said Mats Dillen, the head of the parliamentary review. He declined to give more details on the types of proposals that could be included in the report.

Sweden is widely regarded as the most cashless society on the planet. Most of the country’s bank branches have stopped handling cash; many shops, museums and restaurants now only accept plastic or mobile payments. But there’s a downside, since many people, in particular the elderly, don’t have access to the digital society.

“One may get into a negative spiral which can threaten the cash infrastructure,” Dillen said. “It’s those types of issues we are looking more closely at.”

Last year, the amount of cash in circulation in Sweden dropped to the lowest level since 1990 and is more than 40 percent below its 2007 peak. The declines in 2016 and 2017 were the biggest on record.

…click on the above link to read the rest of the article…

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