BigTech – Replacing Banks

 

Posted Aug 29, 2021 by Martin Armstrong

QUESTION: Can you explain how using Jack Dorsey’s financial tools are another way Americans are surrendering their freedoms.
Although the transaction fees are a fraction of banks and the time duration are almost instant.
Thanks – although after years or writing into your block/contact I’ve yet to have a reply
N

ANSWER: Back in 2020, I had information that BigTech was lining up and was promised that they would be handed online banking if they helped to remove Trump. BigTech was promised the power to overthrow the banks. Governments were also secretly allowing BitCoin to take hold to convince people digital currencies were better than paper. The powers that be want everyone in the banking system to end once and for all paper money. They realize that the stumbling block has been that there are over 1 billion people outside the banking system (just read the IMF). This is an absolutely insane goal to have every goat herder in remote areas online. But the people who come up with these ideas are more egotistical maniacs than practical intelligent people who have ever traveled to such places.

Big Tech had a lot at stake during the 2020 election. I warned that they were censoring everything to try to push Biden into the White House so they can cash in on their chips back on October 20, 2020. The mainstream media is also on board and they even forced Glen Greenwald to resign from the news organization he founded. The media has been also taking grants from the greatest philanthropist/manipulators in history – Bill Gates. Dorsey’s new online bank under Square which I reported in March 2021 that my original sources were spot on.

To make digital currency work, the transaction MUST BE instant. You cannot go into any place and pay with a digital currency that takes hours or days to clear. In the banking system, you deposit a check and it takes often 3 days to clear. The old banking system cannot allow digital transactions that will enable the elimination of paper money.

Square first submitted its application to the FDIC to become a deposit-taking bank in September 2017. Back in 2018, Dorsey in July had dropped his plans for a banking license. He then reapplied in 2018. Previously, Jack Dorsey’s fintech partnered with Celtic Bank for banking products. Square began by underwriting and originating business loans for Square Capital’s existing lending product.

This has all been enabled to further the elimination of paper money and thereby the failing governments believe they will be able to grab whatever taxes they demand and nobody will be able to avoid taxes ever again. On top of that, they also want to eliminate international travel as much as possible to “save the planet” but also to prevent people from fleeing their jurisdiction for taxation. The end goal is a hybrid of the old Soviet Union whereby we will not be able to freely travel and ensure we will be the future economic slaves.

This is why Twitter banned Trump. Whatever excuse BigTech can use to shut down Trump and ensure Biden would win the election was all done to further this agenda where they were promised that traditional banks will become obsolete. Branches will no longer be needed. You can already deposit a check by scanning it into your phone so you need not visit a bank office. Once cash is eliminated, then all that would be left is a safe deposit box which they envision is loaded with valuables you need to pay taxes on.

When government eliminates all paper money, the next step will be to seize all pensions and that will be replaced with Guaranteed Basic Income. In that manner, they will be able to default on all government debt and the Modern Monetary Theory will become reality by restraining our liberty if not entirely eliminating it. The politicians see themselves as the aristocrats who will always be above the Great Unwashed.

This has been what I have been fighting against for these past years. I did the Solution Conference in 2015 because these were the very proposals I was arguing against behind the curtain between 2022 and 2015. The idea of allowing digital currencies surfaced during the 2007-2009 crisis. The bankers blew up the world again and the Fed had to bail out AIG. I was still in contempt when I was asked for help by the House Banking Committee and I asked you do know where I am? They said they would help but I declined. Bitcoin emerged in 2008 as a theory to circumvent the banks because they would routinely blow up the financial world and they expect to be bailed out because the government needed them to sell their debt. That is when they realized that the system had to change.

The Real Reason Govt Allowed Bitcoin

Posted May 12, 2021 by Martin Armstrong

QUESTION: Hello. I know financial gurus are like noses; but I would like to share something I heard. I heard its’ possible the money in our accounts could be exchanged for – lack of better term – Pelosi dollars. The value of these credits could be changed at will. Buying bitcoin will stop this and put our money out of their reach. I believe they can always get our money. Please explain how bitcoin is vulnerable.
Thank you.
BS

ANSWER: Look, any cryptocurrency can be seized and outlawed at any moment. They can seize all places that store precious metals for clients. Herbert Hoover admitted in his “Memoirs” that the entire investigation that led to the creation of the SEC was on the back of a phone call where he was told it was a conspiracy against his administration to create the stock market crash. When he realized that there was no such plot, he apologized in his “Memoirs” writing:

 “But when representative government becomes angered, it will burn down the barn to get a rat out of it.”

There is ABSOLUTELY nothing the government cannot do. They rigged the election with mail-in ballots and you will never be able to truly verify anything. The medical profession has been converted into a prosecution and political manipulation tool. They have bribed BigTech to do their bidding and they own all the major mainstream media with few exceptions that make little difference. Do you really think they would EVER allow Bitcoin to defeat their agenda?

Drug dealers are not using and cryptocurrency because blockchain can be used to track money. There are programmers working right now on trying to devise a completely new form of cryptocurrency without blockchain to restore privacy. Blockchain technology can be traced! With the propaganda about Bitcoin and blockchain, it offers NO security in any transaction which is deemed illegal. Tax evasion is also a crime. I can CONFIRM that Bitcoin has been allowed to prosper because the government can trace the transactions and that is far better for them than paper money.

There are programmers now fully aware that Bitcoin offers no protection whatsoever and they are trying to create a new system that obliterates the blockchain to make it untraceable. 

The rally in BitCoin was a perfect 13 weeks up from the last strategic low.

Bitcoin Still in Trouble

Posted Jan 2, 2018 by Martin Armstrong

The rally in BitCoin was a perfect 13 weeks up from the last strategic low. It peaked with the Weekly Array the week of 12/18 which was both a Panic Cycle and a Directional Change. However, with the impending ban in South Korea on trading cryptocurrencies, the high of December appears to be at least an important temporary high. A weekly closing back below 9425 will ten to confirm the end of the bull market for now.

South Korean plans to restrict crypto currency trading. Bitcoin investors saw the collapse to $13,600 from the previous day trading at $16,500 dollars. South Korea, one of the world’s most important countries for virtual currency trading, wants to ban the opening of anonymous accounts for cyber currencies, among other things. There will also be a new law that will allow regulators to close stock exchanges where Bitcoin & Co. is traded under certain circumstances. “We share the view that crypto currency trading is irrationally overheating,” the government said. “We can no longer tolerate this abnormal speculation.”

Nearly a million people are estimated to own Bitcoin. South Korea is very important because it represents around one-fifth of Bitcoin’s global trade. Regulation by South Korea is extremely important. Even the German financial supervision warns that the risk is total loss for investors. Many view this as if it were the Dutch Tulip Bubble since BitCoin cannot be used in the economy in a fair and orderly manner.

Bitcoin to be Declared a Financial Institution — Beware!

Posted Dec 5, 2017 by Martin Armstrong

The risk with Bitcoin is that the government could simply change the definition of money. That is what they did to me back in 1980 because I was one of the three main market-makers in gold (perhaps the biggest). It was all a hunt for taxes, not concerning me but my clients. I have explained before why I retired from making markets in gold — the IRS declared me to be a BANK!  When gold was legalized in 1975 and began trading on the COMEX in New York, the New Jersey Senate asked me to write the law on gold to make sure it would not be taxable to buy and sell gold bullion. I worked with Senator Foran and developed the language that “gold was not taxable unless converted to use.”

I was making the market to buy gold scrap from all the stores you see with “WE BUY GOLD” signs. They buy the jewelry and it has to be refined. To do that, you needed a minimum lot of 100 ounces, which was the contract size on COMEX. When gold was $800, that meant one 100 ounce bar was valued at $80,000. The refining period was 6 weeks. Therefore, all of these small operations could not afford the float. If they bought 100 ounces per week, then they would need $560,000 in working capital. That would not work for most of these small shops buying gold.

I made the market. The shops could ship whatever they bought that day and I would buy it at the daily price. I gathered all the gold sold by countless stores. The gold was shipped by armored cars to Englehard for refining (PhiBro or Philipps Brothers who eventually bought Saloman Brothers). I was doing tens of millions per week back then and refined a mountain of gold.

First, the NJ tax authorities walked in and declared me to be a merchant. I said gold was not taxable unless converted to a usable product. They said their “interpretation” was that the “use” was investment.  I refused to pay and opted for a trial. Of course, you do not get a jury, just a judge who rules always for the government. I was not allowed to testify at my own trial for they said whatever the Senate had asked me to write, I may have misinterpreted their intention. Senator Foran was so angry that he demanded to testify at my trial. The government objected and he was allowed to testifyONLY as a private individual citizen. I moved to subpoena the full Senate. The judge denied me, and I lost.

Simultaneously, the Feds walked in and declared me to be a BANK. They then declared that I had to file forms to report when my clients bought or sold more than $10,000. Their interpretation was that gold was NEVER formally declared not to be money in 1971, so I was a BANK. They threatened me saying that the fine was $50,000 up to the full amount of every transaction I failed to report. They said they knew I perhaps did not “realize” I was a BANK and would forego the fines if I would allow them access to audit all my clients. I had no choice. They set up shop in my office. I walked by, noticing that they were pulling out names of those whose transaction were even $5,000, and I asked what was going on. The agent turned to me and said very aggressively, “You have a problem, keep your mouth shut!” The next day in rolled the vans and they took all my business records and began an audit over 3,000 of my clients for the next three years.

That is why I retired. I neither wanted to collect sales taxes on bullion nor be a BANK and report on my clients. Since I was the biggest, they were starting with me. People doing business outside of New Jersey would not have the sales tax problem and the IRS was interested in me because of my size. They would not do the same for small shops. So it was time to get out of the business. Clients wanted the research to continue, so that was spun-off as a new company in 1981.

Now comes Bitcoin. The Judiciary Committee of the United States Senate is currently working on Bill S.1241 that aims to criminalize deliberate concealment of property or the control of a financial account. The bill was submitted in June, and the law would change the definition of “financial account” and “financial institution,” and thus also cover digital currencies and digital exchanges. Who is pushing it? None other than California’s Senator Dianne Feinstein, who maintains that the bill is needed to update existing money laundering laws because of terrorists.

This means that the miners of Bitcoin will become a “bank,” as I was declared. The operators of the trading platform Coinbase were forced by court ruling to notify the IRS of the identity of over 14,000 investors who were trading $20,000 in Bitcoin. Users were affected if their trading volume had exceeded $20,000 at the beginning of 2013 by the end of 2015. So this is NOT a single transaction, but accumulative. The IRS will now “presume” tax evasion. This is what I warned would happen. Been there done that! They can shut down Bitcoin in the blink of an eye by simply defining anyone who is a miner to be a financial institution.

The bill will change the definition of “financial institution” in Section 53412 (a) of Title 31 , United States Code. The text will read:

“An exhibitor, a redeemer or a cashier of prepaid access devices, digital currency or a digital exchanger or a digital currency.”

The regulation will remove the anonymity of Bitcoin and other cryptocurrencies defeating this idea that there is an alternative-financial-universe separate from government

Is Cryptocurrency a Government Plot?

Posted Dec 3, 2017 by Martin Armstrong

QUESTION: You have said that the future will be cryptocurrencies. The Bank of Canada has come out and acknowledged what you have been saying that such private issue challenges the government’s profit structure. Do you think electronic money will be viable sooner or later down the road?

PG

ANSWER: Electronic currency is ALREADY the bulk of the money supply. When you deposit $100 in a bank, it lends out $90 from your deposit and your bank statement still reflects you have $100. However, the person who borrowed the money now has $90 in their account. The government did not “print” money to cover that extra $90, rather they just created “electronic” money.

So what is the big thing about cryptocurrencies? The idea is that it is money that will not depreciate and is strangely not “fiat.” Yet, it is no different than the electronic money created by the bank, which is also outside the strict domain of government.

If you just look at the price of Bitcoin, it demonstrates that this is merely a speculative boom indistinguishable from the Dot.COM Bubble, which also reflected a new era in technology. If Bitcoin was truly an alternative currency that was supposed to retain its value, the mere fact that the rice has soared like any stock proves that it is by no means a “store of wealth” that somehow is better than currency in which it must still be converted to use in the bulk of the economy.

If the power grid failed, everyone would be broke. You could not even buy food. Society would revert immediately back to barter. There are risks to any form of electronic money be it a bank or crypto. The government WILL move toward cryptocurrencies THAT THEY WILL CONTROL, not the private sector. I have stated before, they argue electronic money eliminates cash crime from bank robberies, drugs, prostitution, etc., but it introduces more sophisticated hacking computer crimes.

The crime issue is the excuse, but the real issue remains the hunt for taxes. I have to wonder if the government is not behind this entire cryptocurrency phenomenon. Satoshi Nakamoto is the name assigned to this mysterious unknown person or people who designed Bitcoin and created its original reference implementation. Nobody knows who invented this technology. It is entirely possible that this movement is a false flag created by the government to move society to accept the end of tangible money. It is very strange that the person who invented this technology is unknown and has not stepped forward to demand some royalty.

Bit coin. Longer-term, this technology may be the future after the crash and burn. Not now.

Two-Tier Monetary Systems & Local Alternative Currencies

Posted May 14, 2017 by Martin Armstrong

QUESTION: I very much look forward to reading your blog every day and feel that I am learning much. I don’t know much about BitCoin but I note that it has almost doubled since the beginning of the year. Does your model have any insight into the future of cryptocurrencies like BitCoin.

MR

ANSWER: The problem with BitCoin is precisely that. It is akin to the problem that existed when the bubble burst in 1966 with mutual funds because they were listed back then. The value of BitCoin can change at a volatility rate of 10x that of the dollar, making it a highly dangerous instrument as a store of wealth. It is solely a trading vehicle until they way it is valued is changed.

In 1966, investors bid the mutual funds up beyond net asset value so during the crash, people lost everything when they thought it was a secure investment. The net underlying assets may have dropped 20%, but they paid 20% over net asset value and then sold at 50% of net asset value. Many mutual funds crash 70-90% where the Dow drop was 26.5%. Ever since, mutual funds are no longer allowed to be listed. You go in and out at net asset value. BitCoin must change its structure or it will never become a valid currency with a stable store of value which is supposed to be the whole point. It is just an asset class of high volatility.

For this reason, BitCoin is not ready for prime time. However, that is a separate and distinct problem from the technology. For now, BitCoin represents a threat to governments for it is used to get money out of places, avoid taxes, and is an alternative currency. Throughout history there have been alternative currencies and as long as people accept them, at times, they have become the major currency when government does the crash and burn. (see Two-Tier Monetary Systems & Local Alternative Currencies)

Longer-term, this technology may be the future after the crash and burn.