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Central Bank Digital Currency

5896 Views 246 Replies 41 Participants Last post by  Cigars, 
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Anyone know anything about CBDC besides what it is?
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evilwhitey said:
Where did I say anything of the sort? Where have I ever said that interruptions to our comfy, easy modern lives won't happen and that prepping isn't essential to survival? Reread what I've written.
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Fair enough.

I may have confused you with another poster, who also mocked "dystopian fantasies" about the power grid going down. Which IMHO is a very-real danger, and one of the first things to fail when the system starts collapsing.

It's not important enough for me to spend time on. I said on another post, we all prepare for what we sense might happen. Some move; some buy Hummers with crawl treads; and some stockpile shelf-stable food.

You pays yer money and takes yer choice; but I would not put money into electronic scrip that won't have any use once the Worldwide Web is down.
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Explosive
Explosive said:
Thanks
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Now it makes sense to start wearing masks.
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Flashpoint271
All of this doom and gloom. CBDC only occurs if the populace lie down and kiss the ring of the government. We are Americans for God sake! At a minimum there will be a healthy black market for items the government deems unlawful, at most a wake up and 2d revolution. Bring it on I say!
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+++++++ GOLD !!
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Velvet Elvis said:
Seems to me that PMs only have value if they can be sold / converted to government fiat. When CBDCs are ushered in, that government fiat will be the CBDCs. All other currencies will be deemed illegal. They’re not going to exchange CBDCs for pms. If there was an industrial need for your gold, it would be purchased with CBDC. For a time, PM holders may trade between themselves on black markets, but how would value be determined when their is no government currency to peg it to? CBDCs will render pms and crypto worthless I believe.
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Sir:
You have been exposed to fiat too long.

Precious metals are a horrible investment, but they are very secure.

If you study history you will see countless times how precious metals have held value in times of governmental collapse and no government.

They have had intrinsic had value for over five thousand years

Gold are silver are not measured in Dollars.
Dollars are measured in gold and silver.
You are just used to seeing it expressed backwards all your life
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Velvet Elvis
Themanwithnoname said:
Sir:
You have been exposed to fiat too long.

Precious metals are a horrible investment, but they are very secure.

If you study history you will see countless times how precious metals have held value in times of governmental collapse and no government.

They have had intrinsic had value for over five thousand years

Gold are silver are not measured in Dollars.
Dollars are measured in gold and silver.
You are just used to seeing it expressed backwards all your life
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The thing is you (and others) are referencing the value of PMs historically in times of government collapse and similar upheaval. What is coming related to CBDCs is neither a collapse nor upheaval. It is an inescapable banishment of all other forms of currency. The effect that CBDCs will have on PMs won’t be the same as any other scenario that has ever taken place in history. To depend on PMs to behave as “they always have throughout history” is a peculiar brand of normalcy bias in my opinion. I don't care if others want PMs, that is their business. But it’s an ironic blind spot in a prepper environment.
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ralfy
Explosive said:
Why is increasing the value of each ounce pointless ?

Please explain what makes gold and silver promissory notes.
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It's pointless because the purpose of a gold standard is to have a fixed amount and thus avoid increasing money supply.

Gold and siver are promissory notes because they have limited practical purposes, i.e., generally too soft and too heavy to be used for tools, armor, and weapons. What makes them practical is that they can be used as money because they're durable. And money is essentially a promissory note: a medium of exchange for trade.

That's why when things fall apart they become worthless. It's like that scene from the novel The Road, where a man and boy in a post-apocalytpic are looking for ammo and food. They find a box of coins made from precious metals, look at the coins momentarily, and then throw them away.

That's not to say that people should start throwing away gold and silver. Hold on to them for trade, but they won't save a capitalist economy that's needs more than physical media for exchange.
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Explosive
ralfy said:
It's pointless because the purpose of a gold standard is to have a fixed amount and thus avoid increasing money supply.

Gold and siver are promissory notes because they have limited practical purposes, i.e., generally too soft and too heavy to be used for tools, armor, and weapons. What makes them practical is that they can be used as money because they're durable. And money is essentially a promissory note: a medium of exchange for trade.

That's why when things fall apart they become worthless. It's like that scene from the novel The Road, where a man and boy in a post-apocalytpic are looking for ammo and food. They find a box of coins made from precious metals, look at the coins momentarily, and then throw them away.

That's not to say that people should start throwing away gold and silver. Hold on to them for trade, but they won't save a capitalist economy that's needs more than physical media for exchange.
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If gold were to appreciate in value, then that would obviously give more value to any currency tied to it. Letting it float rather than fixing it would be the way to go. I can't see how that would increase monetary supply, monetary value would rise and fall with the value of gold....... It would keep politicians more honest.

Gold and Silver are most certainly not promissory notes Promissory notes come with counterparty risk, Gold and Silver do not.

Rest assured that nobody will be throwing Gold and Silver away.
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Velvet Elvis said:
The thing is you (and others) are referencing the value of PMs historically in times of government collapse and similar upheaval. What is coming related to CBDCs is neither a collapse nor upheaval. It is an inescapable banishment of all other forms of currency. The effect that CBDCs will have on PMs won’t be the same as any other scenario that has ever taken place in history. To depend on PMs to behave as “they always have throughout history” is a peculiar brand of normalcy bias in my opinion. I don't care if others want PMs, that is their business. But it’s an ironic blind spot in a prepper environment.
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So, "This time it's different."

Why should this time be different from any of the other thousands of empire collapses and crack-ups in all human history?

"Normalcy bias" is the expectation that what a person has seen in a short time, is normal and will continue.

Actual human tendencies, take human and civilizational behaviors over all of recorded history, and thus make predictions as to what stage the present is in, and how the traditional rise, or plateau, or fall, of a modern society will follow those historical patterns.

Before there was electronic scrip ("cryptocurrency") there was dollars generated on computer banks. Before that, there was fractional-reserve lending, dollars created without even paper, by simply establishing credit. Before THAT, there was various forms of paper money - which has always collapsed, and we're seeing our own collapse.

And before that, there was currency debasement by coin-clipping - literally, taking gold dust off Roman coins around the edges. And, of course, various Emperors' metal debasement, lowering gold/silver content.

There is nothing new under the sun, as Ecclesiastes tells us.
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evilwhitey
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Velvet Elvis said:
The thing is you (and others) are referencing the value of PMs historically in times of government collapse and similar upheaval. What is coming related to CBDCs is neither a collapse nor upheaval. It is an inescapable banishment of all other forms of currency.
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No sir I am not.

I am referencing the value of them NO MATTER
WHAT.

I would also like to point out that you originally said that essentially Precious metals were dependant upon fiat for their value.

You now seem to of moved past that argument.

As to banishment:
I do believe cocaine and meth are illegal.
How's that working out?

I do believe blood diamonds are still a thing.
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Velvet Elvis said:
I don't view it as your gold can buy $2731 CAD worth of goods. Your gold must first be converted to the CAD in order to realize / spend the value of that gold. Once CBDCs are in place, there won't be CAD to convert your gold to. Wanting to remove PMs from circulation, the government(s) might buy your gold, but they're not going to pay what you deem it was worth in CAD. I doubt they would even bother buying it at all however.
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No sir.

I am not a fan of gold. It is a terrible investment.
That said:
I will be happy to sell my beef directly for gold.
Tomorrow or after fiat is toilet paper.
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evilwhitey said:
As is so often the case during these discussions with PM guys, your memory is wrong sir. You didn't buy gold for $500 an ounce 17 years ago. You may have done so 20+ years ago conveniently at the very best time to buy gold in the past 50 years though (seems to always be the case with shrewd PM investors). I can do the same with crypto but I generally avoid doing so because price isn't my major interest. I mined BTC when it was $12 a pop in 2012, I'm up 1600x there, and mined ETH in 2016 when it was around $12 as well, that's a 141x gain. Using your logic I should tell everyone that crypto is the best investment under the sun because I timed things perfectly (I don't). ;)

So as to cherry pick the other end of the story, individuals who purchased Gold in 2011-2013 are under water with their investment denominated in dollars, let alone purchasing power which is less than 50% of what it was then.

Gold is a poor store of value compared to almost any other physical good let alone paper investments, crypto, etc. There's a reason the vast majority of people under 45yo don't care about gold, it's been a poor performer during their adult lives. I suspect we'll see gold trade sideways over the next five years and likely dip back down into the $1,400-$,1500 range with a return to $2,200-$2,500 gold late in the decade.

View attachment 508626
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No sir. You are incorrect and the other gentleman is correct.

19 years ago gold was $300-$350 an ounce and silver was around $6.

This after being sub $300 and around $3-4 in the 90's.

A cousin of mine got into it at the right time and turned low 6 figures into 7.
Unfortunately his wife divorced him and took much of it.

I invested a little with him (in physical) but not nearly what I wish I had as I did not have it to spare in those days

$500 17 years ago is about right.
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giantsforever1
What do you mean by "no more purchases off marketplace unless you want to risk bank transfer fraud?"
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ralfy
Explosive said:
If gold were to appreciate in value, then that would obviously give more value to any currency tied to it. Letting it float rather than fixing it would be the way to go. I can't see how that would increase monetary supply, monetary value would rise and fall with the value of gold....... It would keep politicians more honest.

Gold and Silver are most certainly not promissory notes Promissory notes come with counterparty risk, Gold and Silver do not.

Rest assured that nobody will be throwing Gold and Silver away.
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It's pointless because the purpose of a gold standard is to have a fixed amount and thus avoid increasing money supply. If you let the value of gold float then you might as well not use it.

Also, about dishonest politicians, the bulk of money supply comes from people making loans in commercial banks. Look up "money multiplier". Worse, money is part of a credit system dominated by what are essentially unregulated sidebets. The notional value of that worldwide is over a quadrillion dollars.

Gold and siver are promissory notes because they have limited practical purposes, i.e., generally too soft and too heavy to be used for tools, armor, and weapons. What makes them practical is that they can be used as money because they're durable. And money is essentially a promissory note: a medium of exchange for trade.

Where's the counterparty risk? They lose value when things fall apart. It's like that scene from the novel The Road, where a man and boy in a post-apocalytpic are looking for ammo and food. They find a box of coins made from precious metals, look at the coins momentarily, and then throw them away.

That's not to say that people should start throwing away gold and silver. Hold on to them for trade, but they won't save a capitalist economy that's needs more than physical media for exchange, and they become worthless in the long term when SHTF, i.e., total collapse. That's why the man and the boy threw the coins away: there's no more trade.
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ralfy
BoboLyman said:
View attachment 508985
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I think various economies have been mostly cashless for decades. In the U.S., for example, only around 3 pct of money consists of FRNs and coins.

It's the same globally:

From Liquidity Pyramid - The Great Credit Contraction
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BoboLyman said:
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Yup. Spot on. Here's a decent 'primer', for those bereft of the ability to extrapo.... :geek:

:unsure: :mad:

.03
jd
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ralfy said:
It's pointless because the purpose of a gold standard is to have a fixed amount and thus avoid increasing money supply. If you let the value of gold float then you might as well not use it.

Also, about dishonest politicians, the bulk of money supply comes from people making loans in commercial banks. Look up "money multiplier". Worse, money is part of a credit system dominated by what are essentially unregulated sidebets. The notional value of that worldwide is over a quadrillion dollars.

Gold and siver are promissory notes because they have limited practical purposes, i.e., generally too soft and too heavy to be used for tools, armor, and weapons. What makes them practical is that they can be used as money because they're durable. And money is essentially a promissory note: a medium of exchange for trade.

Where's the counterparty risk? They lose value when things fall apart. It's like that scene from the novel The Road, where a man and boy in a post-apocalytpic are looking for ammo and food. They find a box of coins made from precious metals, look at the coins momentarily, and then throw them away.

That's not to say that people should start throwing away gold and silver. Hold on to them for trade, but they won't save a capitalist economy that's needs more than physical media for exchange, and they become worthless in the long term when SHTF, i.e., total collapse. That's why the man and the boy threw the coins away: there's no more trade.
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No sir
Gold, silver, iron ore, wheat, cattle and such are NOT 'promissory notes'.
They possess innate value and are the OPPOSITE of fiat.

Please stop confusing people.

Also: Can we please stop pointing to FICTIONAL stories with 6 people left in the world and acting as if it is a real scenario?
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ralfy said:
It's pointless because the purpose of a gold standard is to have a fixed amount and thus avoid increasing money supply. If you let the value of gold float then you might as well not use it.

Also, about dishonest politicians, the bulk of money supply comes from people making loans in commercial banks. Look up "money multiplier". Worse, money is part of a credit system dominated by what are essentially unregulated sidebets. The notional value of that worldwide is over a quadrillion dollars.

Gold and siver are promissory notes because they have limited practical purposes, i.e., generally too soft and too heavy to be used for tools, armor, and weapons. What makes them practical is that they can be used as money because they're durable. And money is essentially a promissory note: a medium of exchange for trade.

Where's the counterparty risk? They lose value when things fall apart. It's like that scene from the novel The Road, where a man and boy in a post-apocalytpic are looking for ammo and food. They find a box of coins made from precious metals, look at the coins momentarily, and then throw them away.

That's not to say that people should start throwing away gold and silver. Hold on to them for trade, but they won't save a capitalist economy that's needs more than physical media for exchange, and they become worthless in the long term when SHTF, i.e., total collapse. That's why the man and the boy threw the coins away: there's no more trade.
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Gold WOULD BE the standard. I recall reading somewhere, that a dollar - the currency name - was corrupted Latin or Spanish for Ounce. One ounce of gold.

It crept upward, but slowly...until Roosevelt II took office, an ounce of gold was $20. There it had stayed for generations.

Roosevelt, with the new Federal Reserve backing him, first banned gold and then devalued the dollar. He paid $20 an ounce for surrendered gold (by no means all of it) and then revalued it at $35. And we thought political corruption was a modern thing...

The point of a gold-based currency is, the ounce of gold speaks for itself. You can denote dollars in gold, if you like; but there would be no floating or revaluing.

If an ounce of gold got to be, say, $10,000...that's the way it is. No reason a small unit of gold couldn't be sandwiched in circulating coins. Nor is there any reason silver couldn't be used on smaller-value coins.

Mostly, there is no reason why $100 gold pieces couldn't be floating around. People seldom carry more than a couple hundred in cash, these days...and there likewise is no reason why credit or account cards (like AmEx) couldn't continue as payment options.

But paper money is the route to destruction; and fiat currency is societal suicide.
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