The Money Reset Has Already Begun: Shocking Details

The Great Reset broke into 4 sections.

It’s the right thing to do. It’s time to reinvent capitalism post-coronavirus.- Doug McMillon, Walmart’s CEO

For most people, money history is a boring theme.

So rest assured, I won’t bother you with storytelling on how a native from a remote island exchanged goods with his neighbor.

Halfway there, you’d been asleep, anyway.

I will shorten the path and explain to you, in four points, how the world will turn upside down its entire monetary system.

If you know how to be on the right side, you’ll benefit first.

1) How It Was Created The First Fake Money

England needed money to defeat the French. In 1694 the British came from a civil war so that the English king couldn’t raise more money. At that time, the richest were the bankers and England’s credit was terrible.

So a committee of the House of Commons was formed. Sir William Paterson suggested a new scheme for the parliament.

In return for the parliament to give particular privileges, Paterson and a wealthy elite created the Bank of England.

Bank of England could issue new paper notes and use them to finance the English deficit.

The bank gave particular privileges to those who could create money out of thin air.

Sounds familiar?

When England decided to print money out of thin air, what do you think the rest of the world did? Right. They started to print money as well.

Fiat currency refers to any money that a government declares to be legal tender. The cycle of fiat currencies rises and collapses — almost every time due to inflation and devaluation.

It starts with the printing money injected into the economy. All this new money creates an economic boom.

Yet, over time, because of human nature, it becomes overprinted. Because it’s overprinted, it starts to create inflation. Then it starts losing value and it devalues enough to lead to its collapse.

What comes after that?

The game has to be reset.

2) Setting Up The Great Reset

There are no historical precedents of a fiat currency that had succeeded in holding its value.

The average life expectancy for a fiat currency is only 27 years.

There are some exceptions. The British pound sterling has been around for more than 300 years. However, over its 300 years of history, this fiat currency lost over 99,5% of its value.

The US dollar is the world’s reserve currency since the Nixon shock. While Nixon’s actions did not formally abolish the existing Bretton Woods international financial exchange system, the suspension of one of its key components effectively rendered the Bretton Woods system inoperative.

Nixon did unilaterally step out of the Bretton Woods agreement in 1971. Fifty years later, the dollar is blowing up. It seems that the US dollar has exceeded in 23 years the average life expectancy of a fiat currency.

Currencies always blow up the same way.

In September 2019, the repo markets collapsed. The big banks knocked at the Fed’s door, asking it to substitute as a lender at rates they would consider normal, that is, about 2%. The Fed hesitated for a moment before massively intervening by injecting over 50 billion dollars of liquidity on 17 September 2019.

I could give other examples, but the game goes on and on.

Jeff Booth said that,

It took $185 trillion of debt to produce about $45 trillion of GDP growth over the last twenty years.- Jeff Booth in The Price of Tomorrow

After the repo market short crisis, the Fed was wading into the breach, firing the “big bazookas” of monetary policy, pumping trillions of dollars into the world’s giant pool of money.

When you have the central banks telling you that this was because of the pandemic, it’s not true.

The pandemic represents a rare but narrow window of opportunity to reflect, reimagine, and reset our world — Professor Klaus Schwab, Founder, and Executive Chairman, World Economic Forum.

The great reset is close, and there is a strong possibility of all central banks embracing this unique opportunity- the pandemic’s excuse- to reset the system.

Some think central banks want to save the system.

What if they don’t want to save the system? What if they’re waiting for the perfect time to make the switch?

3) What Does It Look Like On The Other Side?

Probably it’s the end of currency as we know it.

We’re not going to have money or currency again. We’re going to have CBDCs, also called digital fiat currency or digital base money.

It’s going to be a government ledger — a credit system.

In 2018, a BIS survey, the Bank of International Settlements, which “fosters international monetary and financial cooperation and serves as a bank for central banks,” reported that 63 central banks were already working on a digital currency.

China was the first one to release its CBDC. Other countries are pretty close to following the Chinese, like Sweden, Turkey, Iran, or Argentina. In fact, the USA is working hard on its cryptocurrency.

The IMF, International Monetary Fund, by the name of Christine Lagarde, as recently reported,

Let us consider the possibility of issuing digital currency. There may be a role for the state to supply money to the digital economy.

This currency could satisfy public policy goals, such as (i) financial inclusion and (ii) security and consumer protection; and to provide what the private sector cannot: (iii) privacy in payments.

We’re witnessing the beginning of the big reset. Switching from the currency system over to a digital form of currency.

Yet, this is not money as we know it. It’s something completely different.

Money, we can hold ourselves. We can have access to cash, and we can exchange with each other, or even keep it at home.

CBDCs are different entities. It’s programmable money. When central banks give it out, they can program it to do certain things. For example, they can program a certain amount of money and say to you if you don’t spend it until Friday, it will return to us.

Central banks will have the power to force you to spend their money wherever they want. They can also shift it to change your behavior. How can it happen?

Central banks will encourage you to save or spend digital money by charging a fee or paying interest. It will depend, as you spend or save, within a framework that they will define.

Don’t panic. These fiscal ‘stimulus’ already happen in the current economy. Governments charge fees or pay interest as they intend to model your behavior.

The big difference between the present monetary system and the CBDC system is that you could save your money at home, or do whatever you wanted with it.

CBDC system will work with credits and you’ll have credits to spend. You will earn credits, and you will use those credits.

The thing is, CBDCs are going to control and surveil the entire system, and that’s a scary world.

The future is still a project design. These are presumptions based on the information we have available today.

4) Surviving The Great Currency Reset

The best way not to be caught in this game is not to play the game at all.

Owning real and tangible assets is the only way of being out of the system- own real wealth. Money is not wealth. Money measures wealth.

Wealth is real hard assets, like gold, silver, or Bitcoin.

The difference between gold and Bitcoin is that BTC is not a physical entity. But unlike gold, which can increase due to mining production, BTC has a protocol of 21 million digital coins. So, it cannot be inflated or manipulated.

Holding our purchasing power outside the system will be the ultimate goal. We should have total independence of the central banks’ control.

The dollar is losing 10 to 15% of its value, year after year. So everybody who owns gold is not riding the ascending wave they aspire.

As gold increases its values, miners also increase their production. That is, gold becomes less scarce. It is losing value. Besides, gold buyers need more dollars to buy it. Hence, in reality, gold is not valuing at the speed that people think it is.

According to supply and demand, as the number of BTCs is finite, 21 million of them will value or devalue. There’s no external entity manipulating the system.

If you think that secrecy from governments and no KYC is bitcoins future, you don’t understand what adoption looks like. They will regulate it. You will declare it. You will have to do KYC, and that is fine. It doesn’t take away its store of value but just integrates it.- Raoul Pal from realvision.com

Final Thoughts

If you want to understand the debt cycles and how monetary systems work, you should read what Ray Dalio has been sharing on LinkedIn.

There are four levers that policymakers can pull to bring debt and service levels down to income and cash flows that are required to service them:

1- Austerity- spending less;

2- Debt defaults/restructuring;

3- The central bank printing money or other guarantees;

4- Transfers of money from those who have more than they need to those who have less (much higher taxes for the rich).

Dalio concludes that in the end, “Policymakers always print. That is because austerity causes more pain than benefit, big restructurings wipe out too much wealth too fast, and transfers of wealth from the haves to have nots don’t happen in sufficient size without revolution.”

Dalio studied 5,000 years of rising and falling of all the great empires.

He studied the debt cycles and realized we are in the last inning of a great debt cycle. The previous great debt cycle was the Great Depression of 1929.

There are certain inevitabilities in life and soon we will face extraordinary events.

The rise of technology disruption, bringing a deflationary economy. The fall of a monetary system, getting a new currency system. The rise of a superpower, China, and the weakening of the USA.

Dalio says that 9 out of 16 great debt cycles end up in wars, and that’s something the world doesn’t want to happen anymore. Yet, China is moving faster in the CBDCs- they want to take advantage.

Of course, the USA is too powerful to let this opportunity go away. They will want to keep supremacy as the dollar continues to weaken.

We all must be aware of what central banks and governments are preparing for our future. We also have to prevent and know how to expect. To be winners, in these times of significant changes, is a patience exercise.

As the Fed keeps printing money, assets will keep rising. You should take the opportunity to earn as much as possible, but always with the prospect of reinvesting in hard assets: real estate, gold, or Bitcoin.

These are going to be the havens for an uncertain future.

I’m not a financial adviser. It’s my opinion, but it’s also the opinion of those who manage much wealth, like Paul Tudor Jones, Ray Dalio, Warren Buffett, Howard Marks, or Stanley Druckenmiller.

I hope you find this piece a helpful one. Be safe.

This article is for informational purposes only, it should not be considered Financial or Legal Advice. Consult a financial professional before making any major financial decisions.

If you like to experience Medium yourself, consider supporting me and thousands of other writers by signing up for a membership. It only costs $5 per month, it supports us, writers, and you have the chance to make money with your writing as well. You can cancel the membership anytime. By signing up with this link, you’ll support me directly with a portion of your fee, it won’t cost you more.

Get access to my free books here!