Saturday, February 24, 2018

Latest News Bites on Central Bank Currencies

The idea of central banks moving towards issuing their own "central bank digital currencies" seemed to be gaining a lot of momentum for awhile, but lately the idea seems to have taken a back seat. Below are links to a few news articles on this that provide some insight on various central banks activities related to central bank digital currencies.


Bundesbank - Digital bank run a risk if central banks issue their own virtual currency

"The head of the Deutsche Bundesbank has warned of the risks to financial stability should central banks issue their own virtual currencies, including from a potential "digital bank run".

Click here to read the full article on

Reuters - Chinese Think Tank - Central Banks Should Consider Using Digital Currencies

"Central banks should consider using digital currencies in cross-border payments that could cut transaction time and costs, researchers at the Chinese Academy of Social Sciences (CASS), a top government think tank, said in a report."

Click here to read the full article on Reuters

Reuters - Swiss Bank Has No Plan for Digital Currency

Meanwhile, it is obvious that central banks and governments are still struggling with what to do about private virtual currencies (if anything). For now, they seem to mostly be interested in just issuing warnings and statements of concern:

Independent UK - ECB Wakes up to Digital Currency Concern - Polish Central Bank funds Youtube video to warn about digital currencies

And then we have some central banks trying to partner with digital currency:

Reuters - Saudia Arabia's central bank signs deal with Ripple

My added comments: I think readers can see from these articles that the idea that we are on the verge of some new global reserve currency that everyone will be using in place of the US dollar is simply not reality. We have been reporting here for some time that things seemed to be going in the opposite direction as these articles continue to show.

This is why we have put a mid 2018 deadline here on this blog for something significant to happen that would justify ongoing regular articles regarding the replacement of our current monetary system with some new version based on something that replaces the US dollar. 

Until there is actual evidence that something like that is really happening, it is simply misleading to report otherwise. We'll continue to monitor events and watch for any hint of change. But for now, there is simply no evidence to report that we are on the verge of some kind a major change in the global monetary system unless some kind of new major global financial crisis emerges to force the issue. We'll continue to watch for that as well, but at some point there is no sense in continuing to write regular articles about such an event with no evidence to suggest it is on the near term horizon (even though it could arise at any time).

The biggest events we know of to keep an eye on at this time are what happens with North Korea and if there were to be some kind of major and sharp decline in the US stock market alongside a sharp further drop in the US dollar. In his latest article, Jim Rickards says we should also keep an eye on Turkey. Those are the kinds of events to watch for and what we monitor here. 

The horrific US debt situation should be causing more concern than it does, but so far no one anywhere seems to care about it. Who knows when or if that will change any time soon. Our lawmakers in both political parties just doubled down on policies likely to explode the debt even higher, so they obviously are not concerned. And US debt keeps selling just fine, so why would anyone care?

Beyond that, the US Fed just proved over the last several years that it stands ready to create the money to buy trillions of US bonds should everyone else decide to opt out. Perhaps this is why our political leaders are no longer all that concerned how much debt they run up? The markets seem fine with trillions in new central bank money to keep things running over at Treasury if need be.

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