The Real Peak Complacency

Sprott Money's picture

The Real Peak Complacency


Posted with permission and written by John Rubino, Dollar Collapse

 

The Real Peak Complacency - John Rubino

 

Stocks are at record highs while volatility is at a record low. Which is another way of saying that investors aren’t as worried as they probably should be about the coming year.

 

That’s okay. Price corrections (with their attendant volatility spikes) are normal and natural ways for markets to teach overconfident investors a little humility. Think of them as the financial word’s forest fires, clearing out the underbrush of misconception, malinvestment, and hubris.

 

But there’s another area of Peak Complacency that is neither natural nor benign. And that’s cyberspace. Americans – and Europeans and Japanese – have moved most of their financial lives online just as hackers and other cyber-enemies get the upper hand. Recently:

 

  • Credit rating agency Equifax – apparently through its own incompetence – allowed hackers to access and presumably copy and sell “sensitive personal information” of 146 million Americans.
  • Online portal Yahoo upped the number of accounts that were hacked in 2013 to – get this — 3 billion.
  • The National Security Agency admitted that its state-of-the-art hacking tools were stolen by hackers and are now available for sale on the dark web.
  • The Federal Deposit Insurance Corporation (FDIC) suffered more than 50 data breaches between January 2015 and December 2016, exposing “personally identifiable information (PII) of U.S. citizens.”
  • The U.S. Securities and Exchange Commission EDGAR database of corporate documents was hacked, leading to illegal insider trading that the SEC is still trying to unravel.

 

And then there’s bitcoin, where online exchanges are being hacked with apparent impunity and zero recourse for victims:

 

Cryptocurrencies: How hackers and fraudsters are causing chaos in the world of digital financial transactions

 

(Independent) – There have been at least three dozen heists of cryptocurrency exchanges since 2011 and more than 980,000 bitcoins stolen, worth about $4 billion. Dan Wasyluk discovered the hard way that trading cryptocurrencies such as bitcoin happens in an online Wild West where sheriffs are largely absent.

Mr Wasyluk and his colleagues raised bitcoins for a new tech venture and lodged them in escrow at a company running a cryptocurrency exchange called Moolah. Just months later the exchange collapsed; the man behind it is now awaiting trial in Britain on fraud and money-laundering charges. He has pleaded not guilty.

Mr Wasyluk’s project lost 750 bitcoins, currently worth about $3m, and he believes he stands little chance of recovering any money.

“It really was kind of a kneecapping of the project,” said Mr Wasyluk of the collapse three years ago. “If you are starting an exchange and you lose clients’ money, you or your company should be 100 per cent accountable for that loss. And right now there is nothing like that in place.”

Cryptocurrencies were supposed to offer a secure, digital way to conduct financial transactions but they have been dogged by doubts. Concerns have largely focused on their astronomical gains in value and the likelihood of painful price crashes. Equally perilous, though, are the exchanges where virtual currencies are bought, sold and stored.
These exchanges, which match buyers and sellers and sometimes hold traders’ funds, have become magnets for fraud and mires of technological dysfunction, posing an underappreciated risk to anyone who trades digital coins.

The obvious conclusion is that our bank, brokerage and bitcoin accounts aren’t safe from hackers and/or cyber-attacks that shut down settlement systems and power grids.

 

In the aftermath of Hurricane Maria, for example, much of Puerto Rico is still without power, which means ATM machines aren’t working. See Puerto Rico is now a cash-only economy.

 

So physical cash – always a good thing to have on hand – is a crucial part of disaster planning. And precious metals in the form of small denomination gold and silver coins are if anything even more important, since who knows what a large-scale cyber event and the subsequent central bank money printing will do to fiat currency values.

 

 

Questions or comments about this article? Leave your thoughts HERE.

 

 


The Real Peak Complacency

Posted with permission and written by John Rubino, Dollar Collapse

 

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seataka's picture

During WWII the "BUY WAR BONDS" to "SUPPORT OUR TROOPS" was a SHORE STORY
The prime mover intent was to prevent INFLATION.

GreatUncle's picture

I have been going in reverse ... best to pull away from the internet = "peace of mind".

 

 

Internet-is-Beast's picture

Everything is online. The best you can do is two factor ID and credit freezes with Equifax, et al. Freeze credit cards as well and only buy things online from debit card accounts having a small balance. Any other suggestions welcome.

new game's picture

quite buying shit. no-go amazon prime. fuk that. no face fuk. no social media.

mo, no, no.

all bills auto pay to a MC for points. cash otherwise for gas, groceries.

mort an online payment, not auto.

complete control. as soon as CC is used online, beware.

or paypal...

some risk, but minimal.

oh, yeah, fuk amazon, try ebay with paypal, ussually cheaper...

SSM

GreatUncle's picture

Paypal where you have to provide a photo ID... junked thanks.

 

Father ¢hristmas's picture

My friend just had her identity and $3,000 stolen. 

She previously just tried to get me to switch from Warren Buffet's gang to her goofy ass bank, so she could get a referral bonus.  I just gave her the silent side eye like Frank Underwood in my avatar.

Say what you will about Buffett Bank, but those motherfuckers will lock down my account and call and text me if I buy beer at an Arab gas station too far from my house.

The only reason this chick knew her identity and accounts were fux0red was because she happened to check them after she bought a new car.

This is why we need common sense, bipartisan legislation to repeal the Second Amendment.

Buck Johnson's picture

Also I'm still trying to find on the darknet the Equifax dump for customer information (mostly I want their emails).

 

 

Buck Johnson's picture

"The National Security Agency admitted that its state-of-the-art hacking tools were stolen by hackers and are now available for sale on the dark web".  I want to buy some of this gear also.  I was one of a few who actually read the Der Spiegel article that explained almost all of the devices and software (with pics) of what the NSA made. 

 

 

 

A Sentinel's picture

Nothing online is safe or private.