We are getting much closer to the day when everyone will be required to have the mark of the Hildabeast, 666, in order to buy or sell anything.
PostCambrian
2 years ago
I believe the main reason that Elizabeth Warren supports the digital dollar is to allow the “unbanked” free access to a safe storage and spending of their funds. If the banks would provide this service for free (at least to low income groups) then there would be less pressure on the banks. Payment processors such as VISA and Mastercard also result in a skim of about 2% on transactions. They would be hurt also. If there is no government system then perhaps the government could facilitate a (inter)national system started and run by merchants so that fees would only be less than 0.05% for transactions.
KidHorn
2 years ago
If the FED ever does introduce a crypto currency, it will be to destroy the others. Once FED coin becomes real and is the only officially recognized crypto currency, Bitcoin et al will go the way of confederate money.
anoop
2 years ago
what, me worry?
himanshu12563
2 years ago
In January of 2013, one Bitcoin was valued at approximately $13. Now in October of 2017, its value has crossed $6,000. This year alone, its value has increased by 750 percent.
Crypto is just one way to speculate, but it’s now the major way to launder money from criminal enterprises.
gstegen
2 years ago
1. This is essentially the same as cash. When people
hold and and pay for things with cash the banks are not in the middle so they
cannot make any money on either the holding or the spending of cash. So,
what? There is really no change from cash.
2. Why would ordinary people use this? I see no
real advantage except for cross border transactions where currency translation
costs are eliminated, assuming the foreign receiving party wants to keep the
proceeds in digital dollars rather than convert to their own currency.
3. Since the banks cannot make any money on this it is
similar to cash in that the owner (depositor) will not be able to receive any
interest on the deposit. During normal times (not now) bank depositors
receive interest on most deposits. Even if small, this positive interest
would seem to eliminate all incentive to hold deposits in digital versus
regular deposit accounts. Therefore, I conclude that few people will hold
much money in this form and most will retain conventional deposit accounts. Yes, people who do not have bank accounts will be able to hold funds in this form, similar to a prepaid debit card or gift card. So perhaps banks could lose some small income from issuing prepaid cards, but I cannot imagine that this is much of an effect. Therefor it seems that this is really no threat to banks, except for those that make a lot of
money on currency translation.
4. For transactions within the US there is no currency
translation benefit. There will be transaction costs that someone will
have to pay. I currently pay no transaction costs for credit card, debit
card, ach, bill pay, and person to person transfer transactions. I would expect to
have to pay more if using digital currency since the bank would not be able to
subsidize the costs based on the net interest income it makes off my average deposit
balance.
The Banks credit cards income will disappear, banks don’t charge you interest when you use your CC but they charge the retailer 2-3%, retailers will love to use digital dollar to eliminate CC charges.
I would still prefer to use my credit card because I’d get a month or so’s grace regardless of what the retailer prefers, so the bank won’t lose it’s 2-3% charge. The retailer would currently prefer people use a debit card or cash to avoid the charge but they still accept credit cards.
As a retailer, I prefer everybody use a credit card or debit card.
I don’t want to deal with cash. There’s theft to deal with and also trips to the bank. There are some work-arounds, but for the most part I’m required to charge the same for cash and credit buyers. So I raise the prices for everybody to account for my monthly CC fees. And prefer not to bring cash and checks to the bank, take the risk of bounced checks or missing cash.
I currently get 1.75% to 5% cash rebate on every credit card purchase plus a free loan for 3 to 6 weeks. If crypto/digital dollars became available what incentive would I have to stop using credit cards for most transactions and switch to payment with digital dollars. Lacking such an incentive I would not switch and I do not believe many others would either. Sure, if merchants offered a 3%+ discount for paying with crypto I would consider it and might do so if there were not other offsetting transaction costs I had to pay.
You are missing the fact that the “digital dollar” makes possible the implementation of NEGATIVE interest rates, which you will not be able to do a damned thing about.
Casual_Observer
2 years ago
This is a joke. The Fed supports the dollar as digital currency already. The money is created on a computer and never printed when it enters the bond market.
AWC
2 years ago
The Gateway to UBI, and of course, the establishment of a Social Credit Score scheme.
Animal Farm comes to mind,,,,Brave New World, this. A giant step for Pareto’s Foxes.
Doug78
2 years ago
I see it as limited utility for most people but I can see why the government has an interest it besides the usual stuff of facilitating the tracking of it’s citizens. If everyone else is introducing them then the US wouldn’t want to be left behind just in case it becomes wildly popular so you have to be in the game even if you don’t really believe in it because you could be wrong.
It wouldn’t affect the value of the Dollar per se. That is backed by the taxing power of the US government which is considerable and very believable and the ultimate reason why people accept it for transactions.
Eddie_T
2 years ago
I’ve been talking about this ever since I learned what blockchain was capable of doing…..about 3 years now.
No reason to be worried IF……you don’t mind the government looking up your skirt on every financial transaction you make, you don’t mind paying as much tax as the government could possibly want, and you don’t mind a system of perfect capital controls that guarantee that no matter where you go, your dollars will remain in the firm control of the US banking system.
It is simply the best tool for financial repression ever invented and it amounts to totalitarianism…..if those things sound good, you will love the digital dollar.
I understand why the government might want this but why would I want one? What advantage would I gain, I can do everything with a bank account or credit card and that’s supposedly private. In China I suspect they’ll force people to use their digital currency but I think that’s unlikely in western economies. If the government want to give away free “money”, people would open a wallet but I doubt they’d close their bank accounts.
Six000mileyear
2 years ago
A digital dollar with attract even more hackers to crash the finance system. Without a back-up of physical currency, the moment hackers infect the digital dollar; the economy will come to a sudden halt, followed by massive rioting.
TexasTim65
2 years ago
I think the biggest losers in this scheme would be the credit card companies. With digital money there would be far less need for credit cards. Some people use credit cards as ‘loan devices’ borrowing more than they have and repaying slowly over many years but that would probably be handled by this scheme too at lesser interest rates.
Personally I’m against it because there are too many places cash is still useful. Obviously any time there is no electricity. Other uses are to give kids an allowance. Or friendly wagers on the golf course / weekly poker games and so on.
The one thing to be very afraid of is that once your purchases can be tracked you can bet your health insurance rates will be adjusted once they see how much junk food / fast food you are buying or how much beer your buying etc.
Banks can’t keep throwing crumbs at us consumers if they’re not skimming 2.7% off vendors.
If you play the credit card game well, you can make 2 to 5% off your purchases — the banks rig the game, but they also gear it towards customers who don’t play it well.
Bam_Man
2 years ago
“New and Improved” fake money.
That can be completely tracked and traced (and if need be, cancelled) by your friends at the IRS.
What’s not to like?
Too much BS
2 years ago
HAPPY FATHERS DAY to all Vets from a survivor of many wars and Tours of Duty. Born 1925 He’d like to share his personal, historic, wartime photos with those that respect ALL VETS and the life they gave for peace and their country link to youtu.be
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1. This is essentially the same as cash. When people
hold and and pay for things with cash the banks are not in the middle so they
cannot make any money on either the holding or the spending of cash. So,
what? There is really no change from cash.
2. Why would ordinary people use this? I see no
real advantage except for cross border transactions where currency translation
costs are eliminated, assuming the foreign receiving party wants to keep the
proceeds in digital dollars rather than convert to their own currency.
3. Since the banks cannot make any money on this it is
similar to cash in that the owner (depositor) will not be able to receive any
interest on the deposit. During normal times (not now) bank depositors
receive interest on most deposits. Even if small, this positive interest
would seem to eliminate all incentive to hold deposits in digital versus
regular deposit accounts. Therefore, I conclude that few people will hold
much money in this form and most will retain conventional deposit accounts. Yes, people who do not have bank accounts will be able to hold funds in this form, similar to a prepaid debit card or gift card. So perhaps banks could lose some small income from issuing prepaid cards, but I cannot imagine that this is much of an effect. Therefor it seems that this is really no threat to banks, except for those that make a lot of
money on currency translation.
4. For transactions within the US there is no currency
translation benefit. There will be transaction costs that someone will
have to pay. I currently pay no transaction costs for credit card, debit
card, ach, bill pay, and person to person transfer transactions. I would expect to
have to pay more if using digital currency since the bank would not be able to
subsidize the costs based on the net interest income it makes off my average deposit
balance.