Cash; Use or Lose - BoC CBDC - Loss of Trust – CBDC’s Not Now Says MasterCard - Covid Booster Madness? – Pfizer Shares Collapse – US House Prices Up Again - [12-03-23]

Direct from BOOM Finance and Economics at the links below

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BEFORE BOOM's magical Editorial – Fun Tidbits in lieu of my missing "Letter from Great Britain" until early 2024:  Hat Tip D W Shumway

BOOM EDITORIAL THIS WEEK

PHYSICAL CASH – USE IT OR LOSE IT — BANK OF CANADA (BoC) ASKS ‘THE PEOPLE’ FOR THEIR OPINIONS.  The central bank of Canada is called the 'Bank of Canada'.   It has recently released a report titled, “Digital Canadian Dollar Public Consultation Report”, dated November 2023.

This is in relation to the so-called CBDC – the Central Bank Digital Currency.  BOOM has written about CBDC’s in the Editorial dated October 8, 2023. You can find it HERE. "Central bank digital currencies cannot succeed – they are intellectually bankrupt"

In the editorial, BOOM wrote,“CBDCs may be popular among unelected central bankers, unelected WEF members and unelected IMF apparatchiks but money is ultimately a tool created by and for the People.”

BOOM is pleased to report that the Bank of Canada wisely consulted the People of Canada and the responses were, quite frankly, shocking for the central bankers (presumably) but not to BOOM. The survey received a high level of engagement from individuals across Canada, gathering a total of 89,423 responses during the consultation period. All provinces and territories were represented in the survey. From the Report:

“Forum Research, in collaboration with the Bank of Canada, conducted an online public consultation to gather community views and preferences from across Canada regarding the potential introduction of a digital Canadian dollar. The public consultation was open for six weeks from May 8 to June 19, 2023, to Canadian residents over the age of 18 and was delivered as an online questionnaire.”

“Respondents exhibited a high level of awareness and familiarity with the concept of a digital Canadian dollar. Cash emerged as the prevailing method of payment used among respondents, closely followed by credit cards and debit cards. The reasons for using these payment methods varied, with cash being preferred for its anonymity, safety, and acceptance.”

And, "However, security concerns loomed large, with low trust among survey participants in the Bank of Canada’s ability to issue a secure digital Canadian dollar. Privacy control features, such as controlling the use of personal information and transaction data, were considered more important by respondents than the ability to hold funds anonymously or recover them in case of loss or theft. This highlighted a clear prioritisation of privacy. However, trust in the Bank of Canada and other institutions concerning privacy matters were notably low. “

“Despite high awareness, most respondents did not envision themselves using a digital Canadian dollar and preferred their existing payment methods. They also supported regulation mandating merchants to accept cash and believed that the Bank of Canada should continue to provide an official means of payment backed by the central bank such as banknotes. However, skepticism prevailed regarding the Bank of Canada’s role in researching and building the capability to issue a digital Canadian dollar. Furthermore, respondents were doubtful that the Bank of Canada would consider public feedback on this matter.”

“Overall, the public consultation gathered a diversity of attitudes and concerns from Canadians regarding a digital Canadian dollar, underlining significant reservations related to privacy and security and a strong preference for existing payment methods.”

In fact, that “strong preference” was held by 92% of the survey respondents. And, in the distribution of respondents’ general comments on the idea of a digital Canadian dollar, 86% expressed negative responses, “When asked about overall sentiments regarding the concept of a digital Canadian dollar, 86% of the respondents expressed strong criticisms against it. More than half of the respondents (52%) indicated that they consider it a bad idea and have no intention of using it. Furthermore, they hoped that a digital dollar would never be issued.”

In explaining the rationale for the survey, the Bank of Canada suggested that it was “exploring the issuance of a “CBDC” and NOT the government.

“The Bank of Canada is exploring the possibility of issuing a central bank digital currency (CBDC), also known as a digital Canadian dollar, because people tend to use cash less often these days: most payments are already digital, such as using debit or credit cards. If this trend continues, there may come a time when cash is not widely accepted in day-to-day transactions, which could exclude many Canadians from the economy.

This may be the tipping point when a digital dollar could be needed. The digital Canadian dollar does not exist yet, but the possibility of issuing a digital version of our national currency could help protect the economy and financial system by ensuring Canadian residents always have an official, safe, inclusive, and stable digital payment option in the Canadian dollar. By providing an official and secure digital payment option, the Bank of Canada would ensure that public interest remains the top priority in the rapidly evolving financial landscape.

A digital Canadian dollar would be similar to Canadian bank notes, but in digital form. It would be backed by the Bank of Canada, with the added benefit that it could also be used online. This would not replace cash, as the Bank of Canada will continue to supply bank notes as long as Canadians want them – a digital Canadian dollar would simply be another way to pay.”

Is it all very reassuring?  However what follows is the most important sentence in the entire report. It reveals (hopefully) that central bankers have received BOOM’s lesson loud and clear about currency being something that springs from 'The People' and not from any unelected, non-representative organisation.

“Ultimately, it will be up to Parliament and the Government of Canada to determine if or when to issue a digital Canadian dollar.” [NB] Many central bankers and their chief advisers in many nations are readers of BOOM Editorials confirmed by feedback.

THERE IS A BUILT-IN BIAS.  BOOM has some serious concerns with the wording of the survey in some aspects. There is a bias built into the report in its language. It refers to the, “importance of access to money issued and backed by the Bank of Canada” and to the, “value of money issued and backed by the Bank of Canada”. This is a subtle bias against any money that could be issued by the central government’s Treasury.  In fact, the possibility of such issuance is never mentioned in the entire report.

This subtle bias towards central bank issuance would not be noticed by most people undergoing the survey. However, it carries a strong, subliminal suggestion that the Bank of Canada should be the only source of trust in regard to the issuance of the national currency. And this steals back the key message acknowledged in the most importance sentence where Parliament and the Government of Canada are granted that role.

LOSS OF INSTITUTIONAL TRUST - There is a revealing section in the report dealing with trust in organisations and their handling of data privacy and protection. The results of the survey in this regard were quite startling and reveal a deep suspicion in the Canadian populace of their national institutions.

In the category dealing with “Complete Trust”, only 4% of Canadians have complete trust in their financial institutions; 5% in the central Bank of Canada; 3% in the Government, and only 1% in major Technology companies.

But the shock is contained in the category “Completely Distrust”.  Here, 74% of the respondents completely distrust the Government of Canada; 58% completely distrust the central Bank of Canada; 46% distrust their financial institutions, and 61% completely distrust the major Technology companies.

Such severe lack of trust in national institutions, especially in regard to financial matters, reveals that deep and long term damage has somehow been done to the nation.  If this were to worsen capital flight may begin to take place and that is the end of nationhood or, at the very least, the end of a national government.

BOOM has written about this previously, when the Truckers protest against Covid mandates in Ottawa in early 2022. At that time, it became public knowledge that the Prime Minister of Canada, Justin Trudeau, had taken steps to freeze the bank accounts of certain protest organisers. BOOM referred to this action as akin to, “stabbing the nation in the heart”, but why? Because, in financial matters, the nation is the currency and the currency is the nation.  If a government blocks a free citizen’s access to his or her currency in such a manner, then all the financial institutions of the nation are deeply undermined.

On 28^th February 2022, during the Canadian truckers protest, BOOM wrote, “The Prime Minister and the Deputy Prime Minister thought it was a good idea to freeze the bank accounts of some citizens who were involved in a peaceful protest in Ottawa. This actually happened and there was, of course uproar. But serious damage to Canada’s banks has been done. Their reputation as a place of trust has been dangerously jeopardized, not by the peaceful protestors, but by the government itself.

Money systems and banking systems are all built on trust. They are inherently fragile. Money takes many forms but it is actually a system of mutual promises (credit contracts), recognized and essentially guaranteed by the tribe/society and represented by what we call a generally accepted “currency” used to settle transactions, even in primitive societies.  Trusted banks are a key component in an advanced, complex modern economy.

Trudeau and Freeland have damaged their banking system and their nation very seriously indeed. This is unforgivable for a Prime Minister and a Deputy. Their party should remove them from office immediately. What they did is tantamount to Treason. They essentially took a knife and stabbed the nation in its beating financial heart. An accusation of Treason can be proved if it is discovered that they were taking instructions from a foreign source which seems likely.”

On 3^rd July last year, BOOM wrote, “The entire world now knows that the US recently confiscated the private property of the Russian nation and then of private Russian citizens. Such a move destroys trust in US Dollar denominated assets. This lack of respect for private property is the very antithesis of capitalism.

Then Trudeau froze the bank accounts of private citizens in Canada who were in political opposition to him and he set riot police on them when they were clearly assembling peacefully. Does that sound like a tolerant democracy which holds private property, free speech and free assembly dear to its heart?”

On 23^rd October last year, BOOM wrote, “Think of Biden, Macron, Rutte, Von Der Leyen, Stoltenberg, Draghi, Trump, Clinton, Ardern, and Trudeau; for all of them politics seems to be more about self-promotion than about anything else. They are self-obsessed and absorbed with their “global” agendas and essentially blind to the concerns of the common people under their gaze while caught up in a world of celebrity.

They all appear directed by globalist forces and dictated to by the mainstream media. They are focused on only a few selected topics: Climate Change, Covid, “Putin”, and “The Science”. They appear devoid of any sense of history or destiny and they certainly all lack empathy.”

Once trust is lost it is hard to regain.  The people of Canada have decided that they cannot trust their central government, their central bank or the financial institutions. The nation is in far greater turmoil than could ever be imagined by following the mainstream media. The same could be said of all the advanced Western economies. Despite the politicians and mainstream media’s efforts to sweep events under the carpet and “move on”, the last three years of Covid turmoil has left an enduring scar, a national memory of distrust. The Bank of Canada Report  and survey has revealed how deep that scar runs.

CBDCs – NOT NOW SAYS MASTERCARD – BOOM AGREES NOT EVER. Ashok Venkateswaran, MasterCard's Blockchain and Digital Assets spokesperson for Asia Pacific was recently reported as saying, “Wide adoption of central bank digital currencies would be difficult right now as consumers are “comfortable using today’s type of money. The difficult part is adoption,” he said. “So if you have CBDCs in your wallet, you should have the ability to spend it anywhere you want – very similar to cash today. A lot of them (central banks) are still in the exploratory stages of figuring out whether it will really add value.”

AUSTRALIAN COVID BOOSTER CAMPAIGN WITH 1% ABSOLUTE RISK REDUCTION AIMED AT 10% OF CURRENT VARIANTS – IS THIS MADNESS? A recent article supporting the Australian campaign for yet more Covid Vaccine Booster jabs states:

“This time the booster targets another sub-variant of Omicron known as XBB.1.5 (sometimes known as Kraken). This vaccine is monovalent once more, meaning it has only one target. The target against the original viral strain has been removed.”

Readers should please note that the XBB.1.5 variant is currently only 10% of covid virus mutations being registered worldwide. This data is updated daily HERE.

The Australian government agencies are now embarking upon a nationwide, strong campaign to “Boost” the population against only 10% of the circulating Covid virus swarms (as at 30th November 2023).

They are prepared to take huge risks of adverse events occurring for a whole population to target a minor virus variant. And the mRNA “vaccine” technology being used on the population will only reduce infection risk in that population by approximately 1% (or less). That 1% reduction is the population-wide risk reduction as shown in the original Covid vaccine clinical trials in December 2020.

It is called the ABB Absolute Risk Reduction. The claims for “95% efficacy” are calculated as RRR Relative Risk Reduction. The RRR does not assess risk reduction on a population basis.

So, this booster will reduce the population risk by just 1% for 10% of the total viral “threat”. Think about that — 1% of 10% is a very small figure (0.1%).  The remaining 90% of variants will not be affected by the new monovalent “Booster” program.

This is as crazy as it gets. It appears that Covid Madness has a life of its own, fuelled by government and mainstream media “experts”.

PFIZER SHARES DROP 5% LAST FRIDAY.  In another twist to the developing Covid vaccine story, Pfizer the Big Pharma company, is taking the Polish government to court. They claim that Poland has missed payments for 60 million doses of the COVID-19 vaccine.

The lawsuit is the result of a long disagreement between Warsaw and Pfizer over an apparent glut of vaccine doses. It is all linked to the 1.1 billion-dose contract the European Commission reportedly signed with Pfizer in 2021 which bound all the EU nations. That agreement was famously negotiated in secret text messages by Ursula Von Der Leyen, the President of the European Commission with Albert Bourla, the CEO of Pfizer. [At the time] the nations of the EU were not allowed to see The secret Contract Terms but they are now!

The Polish Health Minister Adam Niedzielski announced, in April 2022, that Poland was no longer taking vaccine deliveries. Now, nine other nations are also apparently thinking of not paying.

If the Court in Belgium decides in favour of Poland then what will Pfizer do about the lost revenue? Pfizer reported $13.23bn in revenues for the third quarter, down 42% from the $22.64bn during the same period in 2022. At the same time, Pfizer recorded $5.6bn in coronavirus-related inventory write-offs and other charges, plus a $4.2bn revenue decrease tied to the planned return of some 7.9 million doses of the antiviral Paxlovid from the US government. Pfizer also reported a loss of $2.4bn for their last quarter of operations. Only 2-3% of Americans are prepared to take their latest booster jab. The general public have woken up.

If the Court decides in favour of Pfizer and Poland still refuses to pay, will Pfizer raise an army and invade?  BOOM thinks not but at least nine other nations will certainly be watching closely, come what may.

Seemingly in response to this uncertainty in regard to governmental actions around the world, Pfizer shares dropped like a stone by 5.12% on the New York stock exchange last Friday. The Pfizer share price chart over the last four months shows the dramatic trading session at the end of last week with the intra-day fall from the previous day’s high  >7%.

US HOUSE PRICES CONTINUE TO RISE AS BOOM FORECASTED.  A major real estate agency in the US, 'Redfin', released a new tool measuring recent changes in US home prices compared to the Case-Shiller series. The Redfin Home Price Index (RHPI) uses a repeat-sales pricing method to calculate how sale prices of single-family homes change over time. The latest RHPI data show that prices climbed roughly 1% from September to October.

The Case-Shiller index is released with a two month lag, meaning that November data, for example, will be released at the end of January.  November RHPI data will be published in mid-December. Redfin has access to real-time home sales data from multiple listing services and does not have to wait for county records to be filed.

Houses are central to the creation of fresh new credit money as bank loans are made to willing borrowers. The money supply of all advanced economies, which keeps the economic garden growing, is very much dependent upon this dynamic. Thus completed home sales are worth watching closely. If demand for homes falls, the money supply will, inevitably fall.

BOOM forecast a rise in US house prices in April. On April 16, 2023, BOOM wrote, “This suggests that US house prices may soon begin to rise in price”.  At the time, nobody was making such statements. However, the new Redfin Index and the Case-Shiller National Home Price Index are both confirming BOOM’s forecast.

Last Thursday November 28, S&P Dow Jones Indices released the latest results for the S&P Core Logic Case-Shiller Indices, a leading measure of US home prices. It showed that, for September 2023, there were month-over-month price increases for 15 of the 20 major metropolitan markets.

In regard to the individual major cities, Craig Lazzara, a Managing Director at S&P Dow Jones Indices said “On a seasonally adjusted basis, all 20 cities showed price increases in September; before seasonal adjustments, 15 rose. Prices in 17 of the cities are higher than they were in September 2022. Notably, the National Composite, the 10-City Composite, and the 10 individual cities (Atlanta, Boston, Charlotte, Chicago, Cleveland, Detroit, Miami, New York, Tampa, and Washington) stand at their all-time highs.”

“On a year-to-date basis, the National Composite has risen 6.1%, which is well above the median full calendar year increase in more than 35 years of data.”

Therefore note this lesson is this. Higher interest rates are driving US house prices up. This seems counter-intuitive to many. So what's happening? Sales are fewer in number with many homes being held back from the market even so prices are rising.  Demand is greater than the restricted supply so prices inevitably rise. [BOOM has nailed it yet again.]

THE US ECONOMY CONTINUES TO HOLD POSITION.  Bank loans for housing have the greatest impact on fresh new money supply. The US M2 money supply was holding steady up to end of October (data updated November 28).

And US Loans and Leases (Commercial Bank Credit creation) from all commercial banks continue to rise, indicating a positive trend for credit creation. Data is to the end of October updated 1^st December.

Thus, the US economy is holding steady under the influence of high interest rates from the central bank, the Federal Reserve. With CPI inflation rates falling in many nations around the globe (disinflation), the outlook remains positive for the US economy and financial asset prices as BOOM forecast from early October this year and from early October 2022 when BOOM forecast that the Peak of CPI inflation had passed.

Speaking last week at Spelman College in Atlanta, The Fed Chairman, Jay Powell noted that consumer prices, excluding volatile food and energy costs, rose at just a 2.5% annual rate in the past six months. That’s not far above the Fed’s 2% inflation target.

In Western Europe, in the Eurozone (where the Euro is used as a shared currency) last Thursday's data showed annual inflation in the eurozone had fallen from 2.9% in October to 2.4% in November, well below forecast. Core inflation fell from 4.2% to 3.6% increasing expectations of European Central Bank rate cuts.  Among the EU largest economies, annual inflation fell in Germany to 2.3%, in France to 3.8%, in Italy to 0.7%, and in Spain to 3.2%.

BOOM’s QUANTITATIVE BOOSTING FOR THE PEOPLES MONEY EXPLAINED: https://boomfinanceandeconomics.wordpress.com/2019/12/15/boom-as-at-15th-december-2019/  AND BOOM’s Perfect Economy: https://boomfinanceandeconomics.wordpress.com/2020/01/18/boom-as-at-19th-january-2020/

In economics, things work until they don’t.  Make your own conclusions, do your own research.  BOOM does not offer investment advice.

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BANKS DON’T TAKE DEPOSITS, THEY BORROW YOUR MONEY: LOANS CREATE DEPOSITS — that is how almost all new money is created in the economy (by commercial banks making loans). https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/money-creation-in-the-modern-economy.  Watch this short 15-minute video and see how Professor Richard Werner brilliantly explains how global banking systems really work.

In 2014, Richard Werner provided the first empirical evidence that banks create credit out of thin air.  They do this whenever they issue a loan or, more specifically, purchase a promissory note. This is a walk-through of exactly how they do it.

Most economists are unaware of this and even ignore the banking & finance sectors in their econometric models.

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