- “In 2017,” Reuters recalls, “Deutsche Bank was fined nearly $ 700 million for authorizing money laundering. The fines stemmed from a scheme of artificial transactions between Moscow, London and New York. York which officials said had been used to launder $ 10 billion outside of Russia. “
- Citigroup, HSBC, Wells Fargo and Barclays were all involved in the 2015 FIFA corruption case.
- It appears that four major banks – JPMorgan, Bank of America, Citigroup and Deutsche Bank AG – have helped Danske Bank Estonia carry out a $ 234 billion money laundering program involving Russian and European customers in the ‘Is.
- The telegraph reports that “the largest bank in Europe, BNP-Paribas, has been accused of” laundering “tens of millions of euros of public money in France for the family of the late Gabonese leader Omar Bongo”.
- JPMorgan paid a fine of $ 2.6 billion for a “decades-long role as [Madoff’s] principal banker, accomplice “of the fraud, according to a statement of the trustee Irving Picard.
- According to the United Nations Office on Drugs and Crime, questionable banking transactions reach up to $ 2 trillion per year …
Ray Dalio heads Bridgewater Associates, the largest hedge fund in history. Founded in 1975, this juggernaut manages $ 140 billion. This figure includes investments from the Teacher Retirement System of Texas, the Singapore sovereign wealth fund and the IMF.
Last week, Dalio briefly made headlines for saying he would rather own Bitcoin than bonds.
Dalio’s statement seems innocent enough at first glance. I mean, who wants to own bonds when rates have to go down for bond prices to go up?
Buy bonds now, with rates around the world at all-time lows, and there doesn’t seem to be much chance for these bond prices to appreciate. I don’t know about you, but I’m not a fan of investments where the chances of making money are so low.
Of course, there are also risks with Bitcoin. There is no way to truly establish a value for a digital currency. And we’ve heard rumors from various types of US governments that they don’t really like Bitcoin. Treasury Secretary Yellen went so far as to say that she would like to “reduce” the use of Bitcoin.
Obviously, much of a government’s power stems from its ability to control its currency. And much of a government’s ability to fund itself comes from the sale of bonds. Threats to this dual mandate will not be viewed kindly.
But why is Dalio ringing this bitcoin discussion right now?
An uncomfortable truth
One of the biggest draws of Bitcoin is encryption. Owning bitcoins and transacting with Bitcoin is completely anonymous. You lose your “account number” and your Bitcoin is gone. There is no way to get it back. Surprisingly, this is the case with 20% of all Bitcoin. It is reported that $ 140 billion worth of Bitcoin is completely and permanently inaccessible because the owners forgot their passwords.
I was told that I should burn my password into a stainless steel strip so that I never lose any Bitcoin that I may or may not own.
Everyone knows that this level of anonymity attracts some unsavory guys. At the bottom you have Chinese nationals who are using bitcoin to take their money out of China and this government. I’m sure the same goes for the Russian oligarchs.
In the middle, there are those who use Bitcoin to pay for a host of illegal dark web stuff.
At the top, there will certainly be drug cartels and the world’s biggest criminals who will convert ill-gotten loot into Bitcoin so that it never falls into the “wrong” hands.
In the world of finance, cash is cash and no one wants to dig too deep if there are fees to be collected to facilitate its movement across the world.
Banks will turn a blind eye every time. And if you think hedge funds are perfectly clean, well, the uncomfortable truth is that money makes the world go round, and no one digs too deep to make sure it’s all about the money. “clean”.
Till next time,
21-year veteran in the newsletter industry, Briton Ryle is the editor of the income equity newsletter The Wealth Advisory, which focuses on dividend growth stocks and premium REITs. Briton also operates the Real Income Trader advisory service, where its readers receive regular cash payments using a low risk covered call option strategy. He is also the editor of the electronic newsletter Wealth Daily. To learn more about the Briton, click here.
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