A quick note from the author: At the moment I sat down to write this piece, global financial markets (of most natures) were/are experiencing epic downturns. DOW/Nasdaq/S&P had shed in excess of $7T (trillion!) of value in weeks; cryptocurrency global market cap had dropped more than 60% (and continued to plummet), central bankers were/are admitting ‘they got it wrong’ on inflation and federal officials were confessing they were running out of options (at least in their partisan, corporatist opinions) to help the public with the pillaging impacts of inflation on individual and household economics, and much, much more. Oil is at an all-time high and climbing; gas is over a historically unprecedented average of $5/gal US; Bitcoin had dropped from $60k to nearly $20k (and falling); US Inflation is at a 40 year high; US debt to US GDP continues to balloon out of control (arguably beyond any reasonable ability for the taxpayers to ever service the interest on the debt, forget the principle(s) involved!); mothers can’t find formula to feed infants (and if they can heaven only knows how they sustainably afford it!?); stores are facing supply shortages; the globe is facing food famines; and so on, and so on, and so on. It is from within the framing of this moment that I chose to ask the following questions. Encountering all the data at hand and considering all the correlations therein, it seemed prudent to contemplate whether communities and the financial institutions which (are supposed to) serve them will always and forever be in the dollar business, or whether stewardship and service in the money business might look different and require some direct response from our generation if we hope to constructively contribute to cycles of financial flourishing and wealth literacy in our worlds and for future generations. With that in mind, I simply speak the following into these present moments with perhaps a modest modicum of opinion that our voices and wills might be of some historical import … all things considered.
Is every generation required to respond to the call of greatness; or are epoch-making moments in history scattered sparsely across time?
Are we, as leaders within current generations, confronted with such a moment in the arc of the human story?
If we are, and this is an epoch-making moment in history, perhaps the question we are here to answer is something like (if not exactly), “will peace and prosperity endure the demise of the ‘almighty’ Dollar?”
Are we prepared to answer that question?
Would we (do we) have a response? (How would you answer that question?)
Getting more specific and precise, when I say “we” in this context, I mean those of us positioned and privileged to lead community financial institutions during these dubious days.
Others in different collectives and communities will also have to respond; but, let us consider how these moments might uniquely (especially) be related to banking and money.
Are we community banking and financial cooperative leaders aware of a role we might (must?) play, a post we must fill, if our generation is to have any chance of answering this potentially generation-defining question with a confident: “YES!
Sure, prior generations have navigated challenging moments, economic downturns, global market crises, industrial discord, technological ‘innovation,’ social revolution, divergent ideological agenda, and polemics of partisan politics.
However, it is possible (probable even) that our generation is navigating a particularly precarious convergence of all of these realities, and certainly confronting unique technological and industrial innovations influencing the resultant concoction of this convergence.
For instance, during the inflationary crises of the 1970s and 1980s, in the early days of what we now know as “Modern Money Mechanics” and the infancy of the electronic US Petro Dollar, central, commercial, and community bankers did not have to understand and account for consumers and communities moving their money out of physical institutions and inflationary electronic dollars into global internet/digital networks designed to be deflationary alternatives to nation-state and central bank influenced money schemes.
Another example: in 1933, confronting an economic depression and extreme destabilization of the recently privatized/centralized dollar banking system, President Franklin D. Roosevelt signed executive order 6102, making it illegal for US citizens to possess meaningful (wealth preserving and capital protecting) sums of physical gold or gold backed certificates. Speculation around motives aside, the Federal decree effectively transferred the wealth of individuals and their collective local communities into the hands of international, central bankers, who then subsequently (having assumed control of the capital) set a gold price which profited the banking system and propped up the central-bank currency for decades to come (until the end of the gold standard, a discussion for another time). Would individuals and communities in the 1930s have capitulated to this banking and taxation scheme, would they have so willingly exchanged stable money and real wealth for paper promissory notes (dollars) if they’d had access to other, more secure, easily transportable, globally usable assets – like digital, deflationary, limited supply assets that can live on the internet? Would communities have surrendered financial security and generational stability so willingly had it been more difficult (impossible?) for the armed imperial guard to remove it physically and forcibly from their hands – under threat of impoverishment and imprisonment?
Would your grandparents or great grandparents have held onto their government-independent wealth (sound money) if they’d been able to secure that wealth in their mind (by remembering a series or numbers or a set of seed words)? More to the point for ‘we the leaders of local banking;’ What if our forebears had a technological alternative to central bank and government debt slips, “promissory notes,” such as decentralized, distributed, local, democratic tools to protect their wealth and secure their resources for families and local economies? Would the people and institutions of 1933 have secured their wealth if they had local advocates to help them distribute it, decentralize it (magically, somehow, like ‘digital gold’) out over the internet … thereby effectively seeding it into the future via a network of globally interconnected ‘gold servers?’
If such technology had existed, perhaps we’d live in an alternate universe with fewer communities devastated by the programmed, systemic poverty of hyper-centralized, globalized, modern money mechanical inflation. Maybe there exists an alternate timeline, like that scene from Back to the Future where Doc Brown draws on the white board, where our local economies didn’t become irreversibly influenced and inescapably beholden to the less visible but equally vicious taxation without representation of inflation.
Fast forwarding to our contemporary situation: suppose we are witnessing the final death rattles of the electronic Petro Dollar (observing the unavoidable end state of 50 years of planned and programmed inflation having eroded all but the most insignificant remnants of the Dollar’s purchasing power), and assuming we’re entering something parallel to the depression era dynamics of the 1930s, we could reasonably conclude epicenters of hyper-centralized power and authority will, out of necessity, act to preserve their positions of privilege and influence – preserving (or expanding) their own wealth and institutional health. In our digital and internet defined moment, it seems unlikely the electronic dollar (SWIFT, NACHA, ACH, EFT, etc.) would be threatened by the less portable physical money like gold, silver, metals, etc. (as the young Federal Reserve Notes were by gold coinage and gold notes in the 1930s). Furthermore, you’re unlikely to find any data or trends in your institution’s transaction records which indicate a clear and present danger to today’s Federal Reserve Notes due to vast quantities of your consumers/members moving money out of their checking accounts and into physical metals. You might however (will undoubtedly!) discover obvious trend lines over the past 2 years of an increasing outflow of deposit dollars into today’s preferred, portable, decentralized (non-bank, non-nation state), deflationary, form of money/assets: cryptocurrency
Whereas our grandparents and great grandparents were a threat to the central banking system for converting their fruits of their labor into a few gold coins, our generation is apparently approaching a critical minimum mass of individuals and institutions preferring to place their capital and hard-earned wealth into alternative, internet-based storehouses – digital produce silos.
Should we likewise anticipate that in response to the programmatic failures of today’s centralized bankers, in an effort to prop up and perpetuate profitable schemes and power centers, Federal Authorities will label bitcoin miners and nerds as well as desperate workers trying to protect the fruits of their labor as criminals and prosecute them as a threat to national security – simply for choosing to invest their time and money in building borderless, frictionless, decentralized, localized internet money? Would it be reasonable to assume the powers that be will further erode private wealth of local people and populations by declaring a “crypto crisis,” thereby vilifying digital pioneers of portable internet money and seizing/extracting wealth out of local communities and households (only to centralize it in corporate coffers and boost hyper-centralized institutional balance sheets as they did in the 1930s)? Is it unreasonable to assume that perhaps the very same governments and central bankers presently fear- mongering around digital assets might be the ones gobbling up Bitcoin as individuals liquidate in the face of historical inflation and attempt to put food on their tables and fuel in their tanks rather than hold onto digital gold for their descendants? Might today’s Bitcoin holder turn into tomorrow’s Bitcoin 401k customer; trading actual currency for a contract promising value in the future when they retire?
Bringing it back home to us, to our industry, to the epoch-making decision “we” (community bankers and financial cooperative leaders) might have to make: forced with a decision to capitulate to new schemes of centralization despite our possession of proven, decentralized, distributed, ‘internet gold’ technologies of which our predecessors could only have dreamed, will we act to preserve the health and wealth of communities – will we evolve into the money business of the future, for a more sovereign and sustainable future of our local economies – or will we merely make available our branches and teller windows as ‘convenient’ location for ‘conspirators’ of the impending “crypto crisis” to confess of their sins and surrender their internet assets and government-independent digital wealth?
Is every generation required to respond to the call of greatness; or are epoch-making moments in history scattered sparsely across time?
Perhaps, if only for lack of proficient tools and technical alternatives, prior generations of bankers might plausibly claim to have avoided any responsibility to answer such a call.
It seems unlikely our generation will (with any degree of honesty) be able to claim ignorance of technological, social, economic, and political ingredients constituting an epoch-making moment and the accompanying, cyclical, predictable, generation-defining call of history.
Will we remain bureaucratic field offices and paperwork agents of the Dollar business; or, will we educate communities, design strategies, promote digital financial literacy, and preserve local capital in the face of the global dollar crisis. Will we amplify a potential impending narrative of ‘the crypto crisis,’ or will we deploy local products and services to preserve capital and catalyze commerce using distributed, decentralized, democratizing technologies for a new epoch of money and finance?
Like it or not, aware or unaware, beckoned or belittled, new networks and technologies are upon us; consumers and communities have begun to embrace them (converting hundreds of billions of government reserve notes and stimulus payments into them in the past two years!), and governments have established new executive orders and bureaucratic mandates to “understand” them and “act in the interest of national security.”
Absent the words and wills of extraordinary individuals and inspired communities, history quickly becomes programmed, patterned, repetitive, predictable, and profitable for a powerful few.
Will our moment be defined by institutional understanding of and investing into technologies, internet money ledgers, modern currency tools – like BTC and other legitimate ‘crypto’ projects and distributed ledger networks – designed to promote decentralized, local, democratic, personal wealth preserving and community catalyzing innovation in capital? Or, will we become one of those generations ‘passed over’ by the call of greatness and accounted for as programmed, patterned, repetitive, predictable, and profitable. Will we protect and promote the local, democratic, decentralized storage and use of personal wealth of the places we live and love?
If we are to respond to this epoch-making moment and rise to the call for the greater good of our communities and their wealth; if we promote and protect financial literacy and the flourishing of the individuals we serve–especially if that requires cooperative resistance to the bureaucratic drivel about digital currency as a national security threat (after all, we have learned the lessons of history; we’re less gullible than our predecessors were about gold) –then we must immediately implement relevant and durable strategies, optimize operations to protect local value and transactions, and safeguard and steward our data (including member digital asset data) as part of the core of our financial institution and community mission. It is precisely the altruistic (albeit audacious) work which we are proud to promote and pursue at DaLand CUSO.
Whether we will be in the money business, or the dollar business is, for a short while longer, perhaps still our fate to decide. Sadly, our prospects of building a time traveling DeLorean are slim should we make the wrong decision; even Elon Musk doesn’t appear to be our Doc Brown!