#305—Weaponizing the U.S. financial system
A new white paper from Greg Kidd
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This week:
Weaponizing the U.S. financial system
Stuff happens
1. Weaponizing the U.S. financial system
Hard Yaka co-founder Greg Kidd has published a new white paper, Weaponizing the U.S. Financial System, which covers the politicization of our financial system by both sides of the aisle.
The first is the politicization of the Federal Reserve. Here’s Greg on why that’s bad news:
Without an independent central bank, politicians have always prioritized turning on the money printing machine of politically motivated low interest rates to prime the pump of growth, leading to inflation or hyper-inflation. Turning the U.S. into a banana republic of money printing is bad enough if you are a minor country that is willing to torch its own future, but doing this to the U.S. dollar is a monumental self-immolation of the world’s dollar based financial order.
Then there’s the politicization of our banking system:
If thinking about destroying the dollar isn’t bad enough, we have another camp of power in the regulatory realm that feels comfortable using Tony Soprano tactics to shame the banking system out of servicing disfavored industries. Under the shield of the innocuous words “safety and soundness,” whole disfavored but legal industries are put to the sword by being forced to scramble to acquire and retain basic bank accounts and the corresponding ability to do business in the country. No meaningful entity can effectively do business without such access, so making such access hard or impossible to garner is effectively death penalty territory for the disfavored. Operation Chokepoint shames banks and other regulated entities from servicing the consensual vices (drugs, sex, gambling) and other disfavored industries (gun makers, fracking companies, payday lenders, money transmitters, crypto, etc.) from being competitively banked — if they can get banked at all. It is one thing to recognize these industries as high risk and thereby requiring additional controls, but quite another to question whether serving them at all is fundamentally “unsafe and unsound” regardless of controls to meet assessed risk
levels.
The conclusion, then, should be obvious:
The author here argues for a recognition that the independence of the central bank and principles of “fair access” to banking for all legal and licensed businesses should be sacrosanct rather than undermined. Weaponization of our financial foundations is short sighted political gamesmanship at the expense of the long term viability. Please make it stop.
Greg is currently running for Congress in Nevada’s second district.
ICYMI:
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