“While CBDCs (Central Bank Digital Currencies) don’t offer any unique benefits to the American people, they do pose serious risks to financial privacy and economic freedom.” — Nicholas Anthony and Norbert Michel
Cash is not going away.
However, most Americans don’t really use cash.
But this is only one segment of the population.
The FDIC reported in 2021 that 4.5% of American households don’t have a bank account.
That’s 1 in 20 houses.
How are those people operating?
They use cash.
We have some insight into why that happens because of our ATM machine fund.
FedNow has recently come out as a digital payment system (as opposed to wiring funds).
It allows for individuals to send large amounts of money instantly, at any time of day.
I’m not a fan of this.
I’ll get into why and also why I think cash is not going away.
Let’s get into it!
1. No Political Will Do Away With Cash
If we put a central bank digital currency in place, it has to be voted in by congress.
In order for that to happen, there would have to be political will.
On the political right, there are issues with central bank digital currency (CBDC) because there are issues of privacy.
If CBDCs get introduced, they can know your every transaction.
They can know everything you’re buying.
They can actually limit what you’re able to buy, who’s able to buy it, and turn off your ability to access the financial system.
It’s kind of terrifying if you think about it!
And then politically on the left, if they didn’t have cash, who would this hurt?
4.5% of households don’t have a bank account, right?
These are usually low-income households.
People who are working for cash under the table.
It’s people on unemployment benefits.
People who use cash work outside of the financial system.
Going fully cashless would really hurt them.
On the political left, they would take a stance against CBDC because it would hurt their constituents.
We also know what happens if this moves into place.
In China, they have an authoritative government where you can’t speak against leadership.
They have something called a social score.
People’s social scores affect their ability to interact with a financial system:
How they buy and sell, how they borrow, what sort of products they’re given access to based on your compliance to government rules.
This is limiting personal freedom.
One thing that really opened me up to this way of thinking was the 2021 Canadian trucker protest.
They didn’t want to get the COVID-19 vaccine and protested in Ottawa, blocking certain streets.
The government declared their actions an act of terrorism and shut down their assets.
The truckers couldn’t access the financial system. In addition, individuals who gave to support this cause had their assets frozen.
It felt like a dystopia!
What if it was easier for the government to do that?
2. If CBDC Comes, There Will Be Resistance
If CBDC comes, especially in the US, there will be resistance.
There will specifically be resistance from those who rely on cash.
CBDC gives so much power to central governments.
They could turn your ability to spend on and off if they don’t like what you’re buying.
People will be resistant to that idea, which is very reassuring.
Personally, I think it’s worth taking to the streets in protest to protect your freedom! Do you agree?
3. No Government Has Ever Done Away With Cash
The third reason why I don’t think cash will ever go away is that no government has ever completely done away with cash.
Even China with their social score system hasn’t done away with cash.
If their controlled central government hasn’t found a way to do it, I don’t think it will ever happen.
There’s always a need to store wealth outside of the financial system.
My friend Joe Brown from Heresy Financial talks about the CBDC as a tyrant’s dream.
There’s already some resistance to CBDC legally.
In Florida, the governor has put up a law that makes CBDCs illegal.
There’s no real benefit for citizens to have CBDC.
The ease of use isn’t enough to outweigh the downsides.
We should stand up against the very idea because it means your personal liberties are being taken away.
Those are worth standing up for.
We’ve seen many cash transactions from our ATM machine investment and it gives people access to cash, freedom, and privacy.
The number of transactions has approximately doubled in the last 20 years.
The more things go digital, the more people are actually using cash.
Before you leave, make sure to check out our special report about inflation investing. It shares the best choices to invest during an inflationary environment.
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Disclaimer: I am not your investment advisor. This is for educational purposes only. I am not giving specific advice on what you can do. I am simply giving my opinions.