"The economics of e-cash"
A prescient signal ahead of its time on a future in which electronic cash could end the government monopoly on minting money, from the 1999 edition of Spectrum, the journal of the Institute of Electrical and Electronics Engineers.
CBDC: The Fed Worldwide Privacy Tour
- The Fed claims to be “fostering a broad and transparent public dialogue about CBDCs in general, and about the potential benefits and risks of a U.S. CBDC” yet “no decisions have been made.”
- The Fed says it “would only proceed with the issuance of a CBDC with an authorizing law.” Yet admits to be investigating “the technical feasibility of a general purpose CBDC that could be used by an economy the size of the United States”
- If your proposal is for most transactions to remain largely anonymous, you’ve admitted to having no interest in protecting citizens’ privacy. Never forget, the Fed loves the look of your privacy.
- Money traditionally has been defined by its three roles as a store of value, a unit of account and a medium of exchange. To this we should add a guarantor of privacy. Money must exclude anything that could be used to violate privacy.
- The Fed wants CBDC to follow the same anti-money-laundering and anti-terrorism rules that violate privacy today. Because the Fed loves the look of your privacy.
- The Fed wants financial institutions acting as CBDC intermediaries to verify the identity of CBDC customers, just as they are required to do now. Because the Fed loves the look of your privacy.
- Project Hamilton says it “does not aim to create a usable CBDC” but the Fed says it “allows us to learn more about these technologies and the choices that should be considered when designing a CBDC.”
- The Fed says “no decisions have been made” but the Federal Reserve Bank of NY is learning how to use CBDC to interface with the Bank for International Settlements
- Through its Technology Lab the Fed “has several CBDC experiments under way” to advance “collaboration with other central banks and international organizations as it advances its understanding of CBDC.”
silvergate bank and silicon valley bank failures
As a financial economist working primarily in the banking industry from 1983 to 2010, I understand the reason Silvergate Bank and Silicon Valley Bank failed is that government regulation made too many people feel safe depositing large sums without paying attention to the banks’ financial health. When that shallow confidence was undermined, depositors ran quickly. We need to replace government regulation with a system in which private-sector analysts publish warnings on bank risks, capitalization and portfolio concentration.
- Government guarantees to keep uninsured depositors whole is a needless bailout that will pressure government officials toward further bailouts in the future. The worst part about bailouts is that they preclude the market from holding banks accountable, which is the only way to keep the system healthy in the long run.
- One big reason these banks were so concentrated in high-tech related assets is that bank regulators discouraged banks generally from getting involved in these areas. Had regulators not been involved, there wouldn’t be such concentrations in such a small number of banks and the system would be safer on the whole.
- Yes, the cost of Silvergate and Silicon Valley Bank bailouts DO get passed on to individual Americans! Increases in insurance premium rates are borne by retail customers, commercial customers, employees and shareholders.
a three-point plan
ending the fed under the gold new deal
Bringing monetary policy, bailouts and regulation under control.