Chris’ note: Last week, colleague and former Wall Street insider Nomi Prins went live with an urgent warning. There’s a major shift coming to our financial system…
It’s all to do with the Federal Reserve’s plan to launch a digital-only U.S. dollar – or central bank digital currency (“CBDC”). And as she showed the more than 6,900 of your fellow readers who tuned in, it’s a threat to your financial freedom.
Naturally, folks had a lot of questions for Nomi. So many, that she didn’t have time to get to them all during her presentation.
If you missed it last week, you can go here to catch Nomi’s briefing. She shared all the details behind the Fed’s digital-only dollar project… and what you can do to prepare.
Then read on below for Nomi’s answers to the most burning questions about this system overhaul…
An overhaul of our money system is underway.
The dollars in your wallet are going away. The Fed is laying the foundations for a fully digital replacement.
The U.S. is one of more than 100 countries around the world putting plans in place for CBDCs.
When that happens, central banks will be able to track, monitor, and record every transaction you make. You’ll no longer have the anonymity physical cash gives you.
Central banks will also be able to use CBDCs to hand out stimulus money. They’ll simply “air drop” it into a digital wallet on your smartphone. This technology is already widely used by cryptocurrency projects.
This means we’re facing even more severe inflation problems down the line.
Central banks could even try new types of stimulus by programing negative interest rates into CBDCs.
Your CBDC dollars could be programmed to lose 5%… 10%… 20% of their value each year. This will force you to spend now or see the value of your savings drop.
I know this sounds shocking. But it’s not the first time one monetary system has given way to something new.
Over the past 100 years, the world’s money system has collapsed… and been replaced… three times.
The first two shifts happened when governments ended gold-backing to fight World War I and World War II.
The third was the Nixon Shock, on August 15, 1971. That’s when Richard Nixon interrupted the TV show Bonanza to declare that he was replacing dollars backed by gold with purely fiat dollars.
Over the next three years, gold soared 266%. And it marked the start of the most inflationary decade of the 20th century.
I got into all the details… including what to do to protect your wealth… during my Countdown to Chaos event. It won’t be online for much longer. But you can catch the replay here.
Now, onto your questions…
Q: During your broadcast, you mentioned the historic shift that’s coming will change our money forever. Can you expand on that?
A: It all comes down to the Fed. It’s our central bank. And it’s trapped.
The Fed been forced to raise rates to combat inflation. But this has left the banking system teetering on the edge. Higher interest rates have lured depositors away from banks and into higher-yielding bond and money market funds. And banks’ portfolio values have tanked.
If it pauses its rate rises, it risks letting inflation tick up again. If it keeps on raising rates, it will further squeeze the banks.
So, to protect its influence and power, the Fed is about to make a last-ditch effort – what I call its “Final Mandate.”
It’s a new digital payments system called FedNow that will make a digital-only dollar possible.
Think of a CBDC as a Fed-issued U.S. dollar cryptocurrency. You’ll spend, store, and save it via a digital wallet on your phone, like how you do with bitcoin and other cryptocurrencies.
On the surface, it sounds great. Most folks don’t like having to go to an ATM to get cash. And with CBDCs there’ll be no more nickels and dimes jingling in your pocket. Just tap a few buttons on your phone and you can send or receive that CBDC in an instant.
But this digital-only system also gives the Fed and the government almost unbreakable financial control over your life. That’s because, unlike physical cash, digital payments can be tracked, monitored, and recorded.
That’s why I say it’s going to change our money system forever. Physical currency is going away. The new money system will be purely digital. And unlike the digital money in your bank account. The Fed – and by extension the government – will be in control.
Q: Nearly every developed country is rolling out the same kind of programmable currency. What will that look like around the world?
A: Yes, more than 100 countries are in various stages of planning a digital currency. According to the Atlantic Council think tank, that represents 95% of the world’s GDP.
Here are just some examples of what’s happening around the world…
Sweden has already kicked cash…
China is paying university and state employees using a new digital-only version of its currency, the e-Renminbi…
Russia has rolled out a pilot program for a digital-only ruble…
Britain is running a beta program…
And Brazil, Argentina, and India aren’t too far behind.
Soon, the entire world will operate using some sort of programmable money.
Our privacy will be gone. We won’t be able to escape without the watchful eyes of the government.
What we buy… how much we spend… who we do business with… Everything will be tracked – and it will all be fair game in the court of the public record.
Q: Will the bullish trend for gold continue? What are your price targets for 2024 and 2025?
A: Yes, I see gold going higher over the next two years, as CBDCs become the dominant form of money.
That’s because I see central banks using them as a new means of stimulus. You’ll recall that President Trump had to send stimulus checks in the mail. This took time. And it blunted the effect of his stimulus effort.
With a CBDC, the Fed will be able to directly send dollars into our digital wallets. This will happen instantly.
It’s one of the reasons central banks are buying so much gold. They see the writing on the wall, and they don’t want to be holding inflating fiat currencies.
Gold has been a go-to inflation hedge for centuries. And it tends to do well in times of economic turmoil. You can see that in the chart below.
Now, the price of gold is on the rise….
As I write, gold trades at $1,916 an ounce.
By the end of 2024, I believe we’ll see gold trade between $3,000 and $3,500 an ounce. And by the end of 2025, I see gold trading between $3,500 and $4,000 an ounce.
So we’re talking about doubling your money over the next two years by buying physical gold or a gold-backed ETF such as the Sprott Physical Gold Trust (PHYS).
And if you tuned into my Countdown to Chaos event, I discussed a more powerful way to profit as gold rallies. So, if you haven’t already, make sure to watch it here.
Regards,
Nomi Prins
Editor, Inside Wall Street with Nomi Prins