Looking Like A Central Bank Digital Currency
Welcome to the Real Estate Espresso Podcast, your morning shot on what’s new in the world of real estate investing. I’m your host, Victor Menasce. On today’s show, we’re talking about a new provision of the latest tax bill that passed the US Congress and is now before the Senate.
During the election campaign, President Trump made it clear he did not favor a central bank digital currency. In fact, he’s made several statements in support of decentralized cryptocurrencies, and his family’s active in various crypto initiatives. But it seems the President may have accidentally created the underlying systems that amount to a Central Bank Digital Currency (CBDC). Whether this is an accident or deliberate is hard to tell. The effect on the long-term freedom and privacy of the citizens of the US is the same.
The Federal Reserve Act explicitly prohibits ordinary citizens from having an account at the Fed. In order for a central bank currency to be enacted in the US, that aspect of the legislation would need to be modified or the accounts housed somewhere close by. Today, I’m going to unveil the system being created that effectively amounts to a CBDC with direct government oversight.
In an effort to encourage more babies, the Trump administration is offering a baby bonus for babies born between January 1st, 2024, and December 31st, 2028. In the new tax bill there’s something called Trump accounts, previously referred to as MAGA accounts. Here’s what that proposal entails…
The actual cost to the taxpayer is expected to be around $3.6 billion a year, as there are about 3.6 million babies born in the US each year. While the bill states the funds would be held by financial institutions, the account is automatically opened by the Treasury and it’s a liability of the Treasury. If the child doesn’t provide banking information, this account will be opened with the Treasury directly. This starts to sound like the tip of an iceberg in a government controlled bank account or investment account.
This is not getting a lot of press, but it’s something you should pay close attention to, especially how the plumbing in this system works and whether it truly is starting to look more like a central bank digital currency. As you think about that, have an awesome rest of your day. Go make some great things happen. We’ll talk again tomorrow.
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