BOOM as at 13th December 2020

WE NEED ELECTRONIC CASH BUT HOW?

We need more cash in our economies. And it will have to be in a digital, electronic form in the modern age. Even the central bankers are aware of this now. Non-interest bearing cash is an extremely useful, excellent buffer against the excesses of credit created money (money created by banks as a bank loan) which is inevitably linked to asset price inflation because of the need to collateralize loans. But cash in electronic form must not be created solely by a central bank or solely by a government. It should be created in a way that negates institutional dominance.

BOOM’s QB Quantitative Boosting is a system for the creation of electronic cash that aims to avoid institutional dominance. Under a QB sytem, it would be created via a tri-partite agreement between the Government (the elected), the central banks (the appointed) and the commercial banking sector (the creators and expanders of credit money in response to borrowers). If all three are involved, then they will act as each other’s policeman. Hopefully, this will stop the creation of excess quantities of cash in too short a period of time which could accelerate CPI inflation risks. Cash could also be withdrawn when necessary in line with the agreement.

The major central banks are attempting to develop electronic cash. They call these projects CBDC — Central Bank Digital Currencies. The name is, of  course, ridiculous. All national currencies are already digital and have been ever since the 1960’s when banks began to use computers to keep their ledgers. The new “CBDC’s” are actually forms of electronic cash tracked on blockchain ledgers. Why is blockchain technology being used? They are being used because entries are immutable (they cannot be altered) and because blockchains are very cheap to run and can be kept private.

BOOM has led the way over the last 2 –  3 years in discussing the desirability of cash as a major component in our monetary system. Meanwhile, the death of cash has been greatly exaggerated by others. The central bankers have (finally) followed BOOM but are now struggling to design an adequate model for electronic cash. They have not yet fully understood that governments will not allow this step to be taken without some significant governmental oversight. After all, governments are very much aware that cash has always been issued under the watchful eye of Treasury Departments.

The tension of financial power between central banks (whose clients are the commercial banks) and governments (whose clients are the people) is a reality which is hidden by a veil called “independence”. A game is played here where everyone agrees that the central banks are “independent” in making their decisions when, in fact, they are not and never will be. After all, the central bankers are appointed by governments (in almost all instances). And, equally, governments are beholden to the banking sector to keep the rivers of credit money flowing in the real economy.

That is all well and good while economies are expanding. The system works until it doesn’t and, for the advanced economies of the world, that time came during the period 1998 – 2008 when the dynamic of private borrowing changed. That dynamic is the propensity to borrow to buy existing assets rather than to borrow to invest in new assets and productive capacity in the real economy. When private borrowers changed that borrowing preference, then the asset economy started to become more dominant over the real economy.

Some people have called this the “financialization” of the economy — where the financial sector dealing principally in assets outgrows the real economy where goods and services are produced and consumed. That term is a good one to describe what happened.

The buffer to such a credit creation boom and its subsequent inequities is to be found in cash. It’s as simple as that. Without the buffer of cash, credit expansion will just continue to create massive inequalities in an economy. Asset prices will rise inexorably. Social unrest will grow. And then political unrest will follow as sure as day follows night.

This is why Quantitative Boosting (QB) has always been envisaged by BOOM as essential but as a tripartite agreement between central banks, governments and the commercial banks.

Quantitative Boosting — A Short Summary: 

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/

PORTUGESE COURT
PCR TEST NOT RELIABLE

An appeals court in Portugal has ruled that the PCR process is not a reliable test for SARS-CoV-2, and therefore any enforced quarantine based on those test results is unlawful. The ruling also suggested that any forced quarantine applied to healthy people could be a violation of their fundamental right to liberty.

The judges ruled that a single positive PCR test for SARS CoV2 cannot be used as an effective diagnosis of infection. This puts the whole Covid phenomenon under a dark cloud of uncertainty. Please read more about the ruling here:

A MAJOR DISEASE DISAPPEARS — GONE TO MARS?

As BOOM has mentioned previously, Influenza has almost completely disappeared during 2020. Have the Influenza viruses gone on holiday to Mars? Examine the graph in the link closely. You will be surprised. 

Link:  https://www.who.int/influenza/gisrs_laboratory/updates/summaryreport/en/

GOOD NEWS — NO SECOND WAVE — DEATHS FALLING IN EUROPE

BOOM has again examined the Z-Score comparative graphs that summarize deaths from all causes in 26 European nations including the UK. The death numbers have shown a typical winter surge in deaths recently but are all now flat or falling. The “dreaded second wave of Covid 19” has clearly not caused any big surges in excess deaths (death numbers above the normal baseline). In most nations examined, there has been no “second wave” at all. 

So why does the media fear campaign continue? Why are the polticians still insisting upon draconian control measures? Please explain.

Link:  https://euromomo.eu/graphs-and-maps

VACCINE TRIALS ARE DESIGNED TO TELL US VERY LITTLE

According to the British Medical Journal, the current phase III clinical trials for Covid Vaccines are not set up to prove whether they will reduce the likelihood of you becoming severely ill or whether they will prevent infection and therefore interrupt disease transmission.

The trials cannot measure effectiveness against severe Covid illness because severe illness requiring hospital admission only happens in a small fraction of symptomatic covid-19 cases. Thus, the number of such cases occurring in a typical clinical trial would be too small to measure.  Even a trial with 30,000 participants would turn up relatively few severe cases, if any.

The “effectiveness” of the vaccine in the trials is therefore measured in just 165 “cases” where the affected people may have no or minimal symptoms such as a mild cough and a positive PCR Test. So, it’s the positive PCR test upon which the trial is truly being judged. And the reliability of such tests is under a heavy cloud right now with the Portuguese court ruling them as “unreliable” plus 22 peer reviewers of the Corman Drosten Paper demanding that the paper be retracted by the journal, Eurosurveillance. That paper is the base upon which almost all PCR Tests for Covid are based.

The article summarizes this situation — QUOTE: “Hospital admissions and deaths from covid-19 are simply too uncommon in the population being studied for an effective vaccine to demonstrate statistically significant differences in a trial of 30 000 people. The same is true of its ability to save lives or prevent transmission: the trials are not designed to find out. UNQUOTE

So, when you see a headline stating “95% effectiveness”, it may just mean that the vaccine is 95% effective at preventing an illness that may not have made you sick. And it certainly cannot tell you if the vaccine prevented any deaths. Think hard about that.

The article also states on the matter of Influenza vaccines: QUOTE: Dramatic increases in use of influenza vaccines has not been associated with a decline in mortality“. UNQUOTE

But who listens to the British Medical Journal when a Fear Campaign is running hot?

The Feature Article is in the BMJ:  Will covid-19 vaccines save lives? Current trials aren’t designed to tell us.  

Link:  https://www.bmj.com/content/371/bmj.m4037

COVID SUMMARY

This is an excellent summary of the Covid 19 phenomenon that should be read by everyone.

Former Chief Science Officer for Pfizer Says “Second Wave” Faked on False-Positive COVID Tests, “Pandemic Is Over”.  Survival Rate of COVID Now Estimated to be 99.8%, Similar to Flu, Prior T-Cell Immunity.

Link: https://www.globalresearch.ca/chief-science-officer-pfizer-says-second-wave-faked-false-positive-covid-tests-pandemic-over/5724753

Of the PCR test, the prevalent COVID test used around the world, the authors write:
more than half of the positives are likely to be false, potentially all of them.”

DR MIKE YEADON ESSENTIAL VIEWING FOR ALL READERS

Please, please take 30 minutes to listen to Dr Mike Yeadon as he summarizes the phenomenon of Covid 19.

His message is deeply genuine and serious. His expertise is unquestionable.

Link:  https://www.youtube.com/watch?v=pZd-mnoj6EM

His CV is staggering — his explanation is clear as crystal. He was Chief Scientific Officer for Pfizer Global, Head of Allergy and Respiratory Research.

THE PCR TEST IS MONSTROUSLY UNSUITABLE”……..  “We should stop mass testing immediately.

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

CLICK HERE FOR PODCASTS:
   OUR BRAVE NEW ECONOMIC WORLD

EMAIL: gerry {at} boomfinanceandeconomics.com

Return to the BOOM Main Website –  BOOM Finance and Economics at  http://boomfinanceandeconomics.com/

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HOW MOST MONEY IS CREATED

BANKS CREATE FRESH NEW MONEY OUT OF THIN AIR (but they always need a Borrower to do so)

THERE IS NO SUCH THING AS A DEPOSIT
BANKS PURCHASE SECURITIES, THEY DON’T MAKE LOANS
BANKS DON’T TAKE DEPOSITS, THEY BORROW YOUR MONEY
Watch this short 15 minutes video and learn as Professor Richard Werner brilliantly explains how the banking system and financial sector really work.
https://www.youtube.com/watch?v=EC0G7pY4wREhttp://

How is Most New Money Created ?

LOANS CREATE DEPOSITS — that is how almost all new money is created in the economy (by commercial banks making loans).

From the Bank of England Quarterly Bulletin Q1 2014    —
“Whenever a bank makes a loan, it simultaneously creates a matching deposit in the borrower’s bank account, thereby creating new money.“Most money in the modern economy is in the form of bank deposits, which are created by commercial banks themselves”.

Youtube Video —  https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/money-in-the-modern-economy-an-introduction

and

https://www.bankofengland.co.uk/quarterly-bulletin/2014/q1/money-creation-in-the-modern-economy

Paper:  Money in the Modern Economy  PDF —  CLICK HERE

Quarterly Bulletins Indexhttp://www.bankofengland.co.uk/publications/Pages/quarterlybulletin/2014/qb14q1.aspx

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

On 25th April 2017, the central bank of Germany, the Bundesbank, released a statement on this matter —

“In terms of volume, the majority of the money supply is made up of book money, which is created through transactions between banks and domestic customers. Sight deposits are an example of book money: sight deposits are created when a bank settles transactions with a customer, ie it grants a credit, say, or purchases an asset and credits the corresponding amount to the customer’s bank account in return. This means that banks can create book money just by making an accounting entry: according to the Bundesbank’s economists, “this refutes a popular misconception that banks act simply as intermediaries at the time of lending – i.e. that banks can only grant credit using funds placed with them previously as deposits by other customers”. By the same token, excess central bank reserves are not a necessary precondition for a bank to grant credit (and thus create money).

”Reference: https://www.bundesbank.de/Redaktion/EN/Topics/2017/2017_04_25_how_money_is_created.html

The Reserve Bank of Australia (Australia’s central bank) has also contributed to the issue in a speech by Christopher Kent, the Assistant Governor on September 19th 2018.“…… the vast bulk of broad money consists of bank deposits”“Money can be created …….. when financial intermediaries make loans

“In the first instance, the process of money creation requires a willing borrower.” “It’s also worth emphasizing that the process of money creation is not the result of the actions of any single bank – rather, the banking system as a whole acts to create money.”
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MOLS Denmark

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