QUESTION: Hi Mr Armstrong,
Thank you for continuous education. I hope to get your view on cashless societies.
There are worries that nations will move to cashless transactions in the near future. Do you think this will actually happen? My guess is it will be a failure and there will be “black” markets where transactions in physical notes will flourish. I see this similar to situations where hyperinflation occurs and the respective governments trying to control their exchange rates by declaring them. However, as this happens, black markets having more accurate rates sprout up.

As usual, they can’t dictate anything that has to do with the real world. What do you think?

MC

ANSWER: That is one of the reasons the Deep State is fighting so hard to remove Trump. They simply believe it will take a seasoned Bureaucrat to sign such a bill. That said, a cashless society will be arriving in Europe before it will appear anywhere else. You must understand that all governments are in their death throes. Instead of stepping back and looking at this from a practical perspective, they remain fixated on their debt crisis that is propelling them to raising taxes. They firmly believe if everyone paid their taxes, they would have no problem. Of course, that is a fantasy. Whatever they collect will NEVER be enough to sustain their power.

In Europe, there is already the tradition of canceling their currency. This is done to prevent people from hoarding cash and not paying taxes. This was a step in the direction of a cashless society for it was intended to add risk to accumulating cash and not paying taxes. Hyperinflation only takes place when confidence in government collapses. When governments are on the hunt for taxes, you actually get the opposite — DEFLATION. This is when people curb their investments and hoard their wealth. The elimination of physical money presents a new twist to the historical record. Hyperinflation in the classic sense becomes impossible for there is no printing of money to pay bills in that sense. Assets will rise in value reflecting the fear of government. That is the emotional equivalent to hyperinflation. Nobody will buy government bonds and capital will hoard and hide in assets whenever possible. There will no doubt arise a black market based upon a barter system. That is why I tend to recommend old silver coins that the average person can identify by a simple date.

They continually try to force socialism upon society so a few can live off of other people’s money. The problem is that capital can flee, as we have just witnessed with Amazon bailing out of New York City and AOC calling it a victory for the little people because they will not have to give them a $3 billion tax incentive to come to NYC.

The entire crisis for New York City is indicative of the way big cities are all on the verge of economic collapse. In the case of New York City, their long-term debt is now more than $81,100 per household and the interest will keep exploding because, like all governments, they borrow with no intention of paying the debt off. Mayor de Blasio has increased spending by as much as $3 billion in the new budget over last year which was $89.2 billion.

With the Economic Confidence Model (ECM) turning down into 2020 very hard, NYC will run a deficit as tax revenues decline thanks to a recession. The more they raise taxes on businesses and the rich, the more they have begun to leave NYC. De Blasio has detailed $750 million in spending reductions but Gov. Cuomo’s preliminary budget has also reduced $600 million in aid to NYC.

With the ECM turning down, de Blasio’s socialistic policies have led to an increase in spending of 32% since he took office. Socialists just simply think they can constantly live off of other people’s money. The city’s long-term pension obligations have exploded and he has increased the city’s workforce by more than 33,000 people, with even more unfunded pensions in the last five years.

We are adding New York City to the list of expected economic disasters