cincodias.elpais.com
Currency Devaluation and the Rise of CBDCs: A Systemic Risk
Since 1971, the US dollar has lost 98.8% of its value against gold, while the Spanish peseta/euro lost 99.5%; this devaluation, exceeding that of the US dollar despite ECB efforts, reflects a global trend of fiat currency devaluation exacerbated by the rise of CBDCs.
- What are the systemic implications of the significant devaluation of the US dollar and the Spanish peseta/euro against gold since 1971?
- Since 1971, the US dollar has lost 98.8% of its value against gold, while the Spanish peseta/euro has lost 99.5% during the same period. This devaluation, exceeding that of the US dollar despite efforts from the European Central Bank, highlights a broader pattern of currency devaluation globally.
- How do the experiences of Zimbabwe and the current global trend of CBDC adoption illustrate the broader issues with government control of currency?
- This drastic loss of value in both the US dollar and the Spanish peseta/euro reflects a systemic issue with fiat currencies. The example of Zimbabwe's hyperinflation, where extraordinary monetary policies were implemented, mirrors the current global trend. This devaluation is not a natural disaster but a consequence of government monetary policies.
- What are the potential consequences of widespread CBDC adoption, particularly concerning individual financial privacy and freedom, and how does this relate to existing systems of social credit?
- The rise of Central Bank Digital Currencies (CBDCs), currently explored by 134 countries, poses further risks. While touted for increased inclusivity and reduced tax evasion, CBDCs, tied to national currencies, guarantee depreciation to zero and represent a significant expansion of government control over citizens' finances and freedom. The 3 trillion dollar cryptocurrency market, a decentralized alternative, is a factor driving this push for greater control.
Cognitive Concepts
Framing Bias
The narrative is framed to strongly oppose CBDCs, presenting them as a tool for authoritarian control and financial repression. The use of loaded language and the sequencing of information, starting with historical examples of monetary debasement, creates a negative predisposition toward CBDCs from the outset. The headline, if present, would likely reinforce this negative framing.
Language Bias
The author employs loaded language such as "destructores de la misma" ("destroyers of it") when referring to monetary authorities. Terms like "Gran Hermano" ("Big Brother") and references to "coacción y control" ("coercion and control") evoke strong negative emotions and contribute to a biased tone. Neutral alternatives could include more descriptive and less emotionally charged terms.
Bias by Omission
The article omits discussion of potential benefits of CBDCs, such as increased efficiency and financial inclusion for the unbanked. It also doesn't address counterarguments to the author's claims, such as the potential for CBDCs to improve monetary policy effectiveness or reduce reliance on cash for criminal activities. While acknowledging the limitations of space, these omissions create a biased perspective.
False Dichotomy
The article presents a false dichotomy between CBDCs and cryptocurrencies, framing them as mutually exclusive alternatives. It ignores the possibility of coexistence or even collaboration between these technologies. The author's assertion that CBDCs aim to replace cryptocurrencies to increase government control simplifies a complex technological landscape.
Sustainable Development Goals
The article discusses how CBDCs, while marketed for increased inclusivity, could worsen inequality by enabling governments to monitor transactions and implement policies that disproportionately affect certain groups. This could lead to increased control and censorship, furthering existing inequalities.