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Ask and ye shall receive …
After watching Saif’s SALT talk I watched the one with Raoul Pal (10 Nov 2020 http://www.youtube.com/watch?v=IVu8cAiJ6fY). He says that at the IMF meeting at the end of October there was considerable discussion of a “new Bretton Woods”. The issue for the central banks is that they need to fiscally stimulate (print more money) but they are running up against limits. The proposal being considered is to inflate the world’s major currencies during the switch to Central Bank Digital Currencies (CBDC). The basic premise is that if everyone inflates at the same time, no one country would be advantaged or disadvantaged relative to other countries.
As far as why a central bank would want to transition to a CBDC: it gives them more levers to use to control the economy, allowing them to get around the current limitations of monetary policy. Today they can only print money or set interest rates. But with a CBDC they have a programmable money that they can program to appear or disappear, grow or shrink, and they can do it on a per person basis. So for example, the legislature could pass laws giving a favored class a growth rate for their money, and give a disfavored class a decay rate. So for example, it may be that the government might decide to favor the investor class with a growth rate and disfavor the immigrant class with a decay rate. Or perhaps the favored class would be poor people and the disfavored class would be rich people. All things are possible with programmable money.