Just in time for the Memorial Day weekend: A fresh podcast well moderated by the Financial Repression Authority’s Richard Bonugli. This was a conversation with South African Piet Viljoen and we go around the world. It is a pleasure to share thoughts with those outside the U.S. Nothing bothers me more than the arrogance of CNBC’s tagline of “Live From the Most Powerful City in the World.” That’s so irritating, especially when many mornings the most market-moving news is coming from Beijing. Well, pour a stiff libation, perhaps Scotch or a Japanese whiskey, and keep the questions and comments coming.
Click here to listen to the podcast.
***An issue we discussed but I want to reiterate was Governor Lael Brainard’s speech on May 24, titled, “Private Money and Central Bank Money as Payments Go Digital: An Update on CBDCs.” Brainard cited four key areas of focus that need to be discussed: The growing role of digital private money; the migration to digital payments; plans for the use of foreign CBDCs in cross-border payments; and concerns about financial exclusion.
The idea of a STABLECOIN has been thrown around but she is the first one to define it: “A stablecoin is a type of digital asset whose value is tied in some way to traditional stores of value, such as government-issued, or fiat, currencies or gold. Stablecoins vary widely in the assets they are linked to, the ability of users to redeem the stablecoin claims for the reference assets, whether they allow unhosted wallets, and the extent, and the extent to which a central issueris liable for making good on redemptions rights. Unlike central bank fiat currencies, stablecoins do not have legal tender status.”
This is earth-moving comments from a FED governor. The mention of a GOLD-BACKED CBDC is what we at NOTES have been discussing as a Chinese move to disrupt the international order. Here we have Brainard raising the issue of a possibility of precious metals ensuring the value of the FED‘s stablecoin with an underlining value anchor. If the Chinese were to fulfill the role of Revisionist Power rather than status quo power what better way then to be first mover to a SILVER- or GOLD-backed CBDC. This is a very serious issue raised by a powerful voice on the Federal Reserve. Failure to be attentive will not serve the global investment world well. The DYNAMISMÂ of GLOBAL FINANCE lies far beyond the walls of WALL STREET.
***It has been a year since the Wolfgang Schaeuble PIVOT (take a look through the NOTES FROM UNDERGROUND archive). Schaeuble started the move to sell the DOLLAR by pushing the EU to not lend money but to give grants to the economically depressed regions of Europe. It happened over Memorial Day weekend, so pay attention to any news over the weekend made outside the most powerful city in the world.
Tags: CBDC, Lael Brainard, stablecoin
May 28, 2021 at 7:49 am |
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May 30, 2021 at 9:28 am |
Hi Yra Hope all is good for you in Arizona. If I may dare, I suggest that Richard and FRA host a conversation with you and Lacey Boles on the the inflation/disinflation issue. I like the interviews to date but the discussants all seem to have the same points of view. Here is a recent interview with Boles on Real Vision that I found quite intriguing with a deflationary tilt:
https://www.youtube.com/watch?v=kbotiZ0E2lc
FWIW The Bigman
May 30, 2021 at 11:00 am |
So the “Stablecoin”, sounds to me, like another SDR.
A basket of existing assets…..used to make transactions easier. Maybe developing countries could borrow in it, only to have to pay back their loans in USD.
Am I missing something, please?
May 30, 2021 at 4:22 pm |
Pierre—no I agree with you–it sounds very much like a domestic SDR