"Federal Reserve Digital Dollar"... is this a bad idea?

https://www.google.com/search?&q=Federal+Reserve+Digital+Dollar

https://www.digitaldollarproject.org/exploring-a-us-cbdc

Or is this the way things are going to be?

Could it be *both*?

 

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Let's put this another way: do you want the Fed to have the power to impose negative nominal interest rates on your money, such that your digital dollar will only be $0.99 tomorrow?

 

They can already do that. If there's negative rates you lose money by having money in the bank

 

Don't confuse nominal with real.

 

It's very real that banks and others start getting charged for the money they are storing. The whole idea of it is to encourage spending to get the economy going. While a drastic measure it has happened in parts of the world in the last decade

Individual banks are certainly free to set their own rates to keep everyone from just pulling their money out, but during such a drastic measure people are losing money for having it

 

I don't know that it's any worse than the bitcoin idea.

 

In those countries where they imposed negative rates, the main "enemy" has been physical currency. central banks HATE physical currency, since it thwarts total control of interest rates. Smart Germans have been taking Euro notes out of their account and simply putting them in a SDB. Better zero percent interest than negative. That is what has prevented more negative rates around the world, and prevented them from going more negative.

Get rid of that, impose digital cash, and the central banks have more power. After they get rid of cash, PM would be next on their radar, (as well as bitcoin, which being outside their power they also loathe).

 

Right, but up to this point, negative rates have never officially been imposed on retail deposits in the US. I guess you could argue that negative real rates (accounting for inflation), coupled with exorbitant maintenance fees charged by BofA, Chase, etc., mean that we're already experiencing negative rates to some extent. Still, at least the government can't easily devalue the currency in nominal terms; that would require a digital currency that could be manipulated at will. Not something I advocate for, to say the least.

 

There's no world where that is going to happen in anyones lifetime.

Yes there have never been negative rates in the US, nor are they likely. Going negative is an extreme measure and not something world reserve currencies do, 0 is really the floor for the USD.

 

Cash as a medium of exchange, has been declining for decades now. It is about a third of transactions today, but with Covid I bet that declines further. I went into three stores yesterday, all demanding electronic payment and no cash.

As for "no reserve currency would do", isn't Germany negative? Third largest economy and the largest user of the Euro, (probably the world's second reserve currency). Think about it, as our debt becomes larger, the easiest way for the Federal government to finance that is to have negative rates, meaning their debt goes down each year and they have no interest. Super low interest rate manipulation is the new "printing money" idea of those who want to spend way more money than we have. This is the new way of taxing savers.

 

And this has been discussed in the news media recently.

 

Germany isn't negative nor are they a reserve currency as they don't even have their own currency.

 

https://ycharts.com/indicators/germ...t -0.52%, compared,long term average of 2.44%.

Same chart shows France and Netherlands are also negative. Those three countries are a massive portion of the Euro. Effectively there isn't a Euro without Germany and France.

 

While true, you aren't an actual reserve currency being so convoluted by other countries and again not even having your own currency. The USD is on a level of it's own

 

Yes it is, top level!

 

Sorry for putting in a reply to such an old post. My comment is that there is going to be a "digital dollar" and we will have digital, virtual currency in the not-too-distant future, if the folks who own the central banking system can achieve this milestone of societal control. The nasty surprise is going to be that the only people who have any actual cash will be guys like us, liscenced and registered numismatists, who'll be able to buy & sell coins and paper money under ever-tightening federal supervision. For everyone else, and more so for their kids and grandkids, cash will be a quaint memory and all of our financial transactions; our "paychecks" and paying bills will be embodied in the screens we now use to innocently jaw at each other about hallucinatory mint errors and the spot price of silver. If you buy a dozen ears of corn at a roadside farmstand, you're going to swipe your "Cashcard" on the stand keeper's digital device and the amount will of course be debited from your account, just as it is now, except that paying with money from your pocket won't be an option; there won't be any money in your pocket.

Did somebody say "social control"? Yeah, just imagine the control a situation like this will give to whomever; let's say "them", or "they". We're already slipping down the proverbial slope towards "vaccine passports", aren't we? How easy would it be, to connect the availability of your digital banking "privileges" to your compliance of yourself and your family members to vaccine compliance or any other "desirable social program" our government and its owners would like to see enforced?

For those who have signed up for Minimum Basic Income programs at whatever level of federal or state authority, it would be strictly No Contest; get with the program or the cash card stops working and your kids go hungry; after due notification of your delinquency has been furnished to you, of course.

The point of all this is: be careful of what you wish for; that digitalized, virtual money and banking is a hugely powerful genie to let out of the bottle. It's a convenience and perhaps, a more economical monetary system, but it is also potentially vital piece of enforcement infrastructure to implement whatever "socially desirable program" our plutocratic-technocratic elites believe will smooth out all of the hassles, friction and problems of how best they can get us to comply and become smoothly-working parts of the machine that they envision as our society.

I apologize for the length of this comment. Question the program.

 

Cash will never be completely eliminated. Without cash it makes political graft more difficult for them to hide.

The infusion of a digital currency supplemental to cash is definitely in the works, but completely removing cash to form a totally cashless society isn't happening.

Corruption needs a way to flow. Unless of course a digital wallet can be stealthily funded and hidden. And I wouldn't put that past the elected thieves.

 

The Federal Reserve is not part of the Federal Government, and it has no reserves.

 

they just want to be part of the cool block chain crowd and not miss the boat on it. I'll never use it, my "cards" handle my digital needs just fine, and I have no use for the cryptos or digital currencies.

I think it's more of a play to make a digital currency, and then ban the use of the others, "you don't need them, the banks won't take them, but they will take 'americoin"" !

just in case one of them were to take over for the u.s. dollar in the long run got to hedge their bets even if the fed reserve banks have to bottom deal from the deck.