Bitcoin was on a total tear…
And then it wasn’t.
And then it was.
And then it wasn’t again.
Nobody knows why.
But, hey, we bought a little on Tuesday anyway. And then a little bit more yesterday. And then we had some gold stored in a vault in Singapore. And then Hong Kong.
And then, finally, we pulled out some cashish.
Call us crazy… but we’re looking for alternatives out of the biggest digital currency scam of all time.
And no, it’s not bitcoin.
You look confused…
I’ll tell you what the REAL biggest digital currency scam is in a moment.
Before we go there, though, let’s talk, for a second, about the War on Cash.
OK. First things first…
Recognize that the vast majority of money in the system is already digital.
As Phoenix Capital Research pointed out in Zero Hedge yesterday…
- “The total currency (actual cash in the form of bills and coins) in the US financial system is a little over $1.36 trillion.
- “When you include digital money sitting in short-term accounts and long-term accounts then you’re talking about roughly $10 trillion in “money” in the financial system.
- “In contrast, the money in the US stock market (equity shares in publicly traded companies) is over $20 trillion in size.
- “The US bond market (money that has been lent to corporations, municipal Governments, State Governments, and the Federal Government) is almost twice this at $38 trillion.
- “Total Credit Market Instruments (mortgages, collateralized debt obligations, junk bonds, commercial paper and other digitally-based “money” that is based on debt) is even larger $58.7 trillion.
- “Unregulated over the counter derivatives traded between the big banks and corporations is north of $220 trillion.”
Moreover, governments all over the world are putting restrictions in place on the use of cash.
For your safety, of course.
Our rulers tell ‘we the serfs’ that the suppression of cash is to keep us safe from terrorists like ISIS (see: government-created terrorism), tax evaders (see: patriots like Irwin Schiff), drug cartels (see: CIA), and villainous two-legged creatures who expect to be treated like adults.
Of course, that’s the “official” aim, according to the Tower of Babble.
But as we both know, the “official” aim is never, actually, the true aim.
The true aim of the War on Cash is to force everyone to operate within the rigged and bugged system. Face it. We are Big Brother’s milk cows… and he expects little more from us than to chew the genetically modified cud like good bovine.
But treating us like cattle is only one aspect of the War on Cash.
“Other reasons for suppressing cash,” Joseph Salerno from The Mises Institute adds, “are (1) to prop up the unstable fractional reserve banking system, which is in a state of collapse all over the world, and (2) to give central banks the power to impose negative nominal interest rates. That is, to make you spend money by subtracting money from your bank account for every day you leave it in the bank account and don’t spend it.”
We hope you’re paying attention. The Totalitarian Tip-Toe, dear LFT reader, is becoming a brisk tromp.
We’re nearing a point where, if you happen to decide to use cash one day, you’re immediately engaged in “suspicious activity”.
It’s already happening in other countries.
France, as a result of this absurd notion, just banned any cash transaction over €1,000 euros. Likewise, Spain has banned cash transactions over €2,500. And Uruguay, cash transactions over $5,000.
Last April, it was announced that Greece would impose a charge for all bank withdrawals.
And those restrictions, plus many more just like it, are coming to a bank near you.
That’s why it’s crucial you start getting a good chunk of your money out of the current Bankster-run financial system.
You need to avoid, as much as you can, the biggest digital currency scam known to man — the Federal Reserve “Note”.
To shed more light on this, we’ve invited Simon Black of Sovereign Man to the show.
Meet the digital currency that is a total scam
By Simon Black of Sovereign Man
It was back in May 2010 that the very first ‘real world’ Bitcoin transaction was conducted: 10,000 bitcoins traded for two Papa John’s pizzas.
Today that transaction would be worth nearly $4 million, probably making those the most expensive pizzas in the history of the world.
But back then it was considered revolutionary to trade a ‘digital’ currency, something that few people really understood at the time, for a real product.
People are still skeptical of digital currency. But the concept itself is not so esoteric.
As Jim Rickards reminded me some time ago, MOST currencies are digital, even the US dollar.
The Federal Reserve’s estimate of US dollar money supply is $12.1 trillion; yet only about 10% of that is physical cash in circulation.
The rest—more than $10 trillion—is simply a series of entries in banks’ core system databases.
In other words, the money in your savings account isn’t piled up inside your bank’s vault. Far from it.
Your savings doesn’t really exist. It’s all just digits in an electronic account ledger.
And yet we transact with these digital currency units all the time.
Whenever you use a credit card or send a bank transfer, you’re using the digital form of your currency.
This concept actually dates back to the Middle Ages when Italian bankers realized that they could conduct their transactions without physical money.
Rather than risk transporting gold coins across the countryside, medieval bankers merely annotated their ledgers with debit and credit entries.
They didn’t have the computers, but it was the same concept– they kept track of transactions and balances on account ledgers, instead of with physical money.
In the late 1960s, the IMF took this idea to the next level when they created their own digital currency for the exclusive use of governments and central banks.
They’re called Special Drawing Rights (SDR, or XDR).
And even though the IMF’s balance sheet totals nearly 300 billion SDR (around $211 billion USD), not a single SDR exists in physical form.
100% of the SDR money supply is digital. Just like Bitcoin, it exists in computer databases, making it the digital equivalent of a 500-year old accounting system.
There is one key difference, though.
No one controls Bitcoin. But dollars, euros, SDR, etc., are controlled by central banks.
Federal Reserve, Banque du Canada, Bank of Japan, etc. all decide how much of their currencies to create.
The SDR in particular is a total scam; the entire reason it was created was because the system didn’t have enough real savings.
So they ‘solved’ the problem by creating a new digital currency that allowed them to easily conjure more money out of thin air.
But the even bigger risk is the commercial banks, which control your account balances. They keep all the records and ledgers, they hold all the keys.
This means that the ‘money’ in your savings account isn’t really yours.You don’t actually have any savings.
What you really have is a claim on your bank’s savings. Your account is just an entry in the liability column of their digital ledger.
When you make a deposit, you’re trading your money for a banker’s promise to repay you.
And there are countless regulations giving them the authority to break that promise.
(If you want to test this premise, try withdrawing $25,000 just to see how your bank reacts.)
That’s the system that controls your wealth today. It’s almost entirely digital. And it’s run by unelected bureaucrats whose interests are not aligned with your own.
This is not a free system. And any rational person should consider parking at least a rainy day fund outside of this system.
Bitcoin is certainly one option.
No one controls it, which is a novel concept in an era when governments and central banks control everything from the value of your savings to what you can/cannot put in your own body.
But if Bitcoin isn’t your flavor just yet, consider other options.
Gold and silver still have incredible merit since they cannot be conjured out of thin air by central banks.
And even holding physical cash is a much better alternative than keeping everything inside a highly centralized banking system.
[Ed. note: Tomorrow, we’re going to dig into the ONLY article about economics you’ll ever need. Be sure to share it far and wide. Stay tuned…]