The precious metals mining sector will enjoy another boom, says Ed Bugos, Senior Investment Analyst and Financial Editor at The Dollar Vigilante “An unsound one…
Posts published in “Finance”
Throughout his whole life, Ed Bugos, Senior Investment Analyst and Financial Editor at The Dollar Vigilante, always thought that the common cold would wipe humans…
Although public debt has swelled to the highest in history, the International Monetary Fund (IMF) warned Friday that cutting stimulus could undermine the recovery and…
The “unprecedented” fiscal policy response of 11 trillion U.S. dollars worldwide has pushed global public debt to reach a record high, according to the International…
International Monetary Fund chief economist Gita Gopinath has advised governments to implement “equity-like” support instead of loans as firms increasingly become insolvent due to lower…
75 years after the creation of the Bretton Woods conference, The IMF is saying now is the hour of the Special Drawing Right (SDR), which…
By this point just about everyone on the planet who has the option to work from home is doing it. This is “the new normal,”…
Instead of bailing out states at the federal level, Senate Majority Leader Mitch McConnell said he prefers states struggling with high public employee pension costs to declare bankruptcy.
“I would certainly be in favor of allowing states to use the bankruptcy route,” he said Wednesday. “It’s saved some cities, and there’s no good reason for it not to be available.”
Public debt is skyrocketing as central banks expand their balance sheets to record levels.
“The amounts being purchased are enormous, and it just tells you how much support is needed when the economy is closed down,” said Torsten Slok, Deutsche Bank’s chief economist. “Just have a look at how long it took to unwind from the financial crisis of 2008 and 2009. Now we are adding at a pace that is multiples faster.”
Bank of America’s survey of global fund managers showed “extreme investor pessimism” regarding cash held to the bleak outlook they hold for the global economy.
Paul Singer’s Elliott Management said global stocks might lose half or more of their value from the high reached in February, predicting a 1930s-esque Great Depression. In a letter to clients, the New York-based hedge fund wrote that the sharp market decline seen between late February and late March “provided a heavy bookend to a dozen years of basically nonstop positive returns in global stocks, bonds, and real estate.”
BlackRock, the world’s largest asset manager, will oversee the Fed’s efforts to stabilize the bond market. The central bank was tapped during the 2008 crisis, but was slow to disclose the specific terms of its agreement with BlackRock during the last crisis, and even today the full details of what the firm earned have not been disclosed in that deal. The details of the current deal are unknown.
As the U.S. federal government battles the coronavirus epidemic, the federal deficit has been pushed above $3 trillion. Meanwhile, unemployment is also increasing ahead of the April 3 jobs report.
“Financial crises recur in part because memories fade.” – Ben S. Bernanke, Timothy F. Geithner and Henry M. Paulson Jr in “Firefighting: The Financial Crisis and Its Lessons.”
Neel Kashkari, president of the Federal Reserve Bank of Minneapolis told CBS’s “60 Minutes” that “there is an infinite amount of cash in the Federal Reserve. We will do whatever we need to do make sure there’s enough cash in the banking system.”
“Forget the mattress! Keeping large sums of cash at home is risky,” the FDIC tweeted today. “The best place to protect your money is in an FDIC-insured bank where it’s safe and sound.”
Italy’s banking staffs have worked without protection against the coronavirus epidemic, and they may go on strike, according to the head of the sector’s main union on Tuesday.
Investors are divesting from corporate bonds at a record pace. Shares of funds that buy investment-grade debt at a pace not seen since 2008, according to Bank of America.
Will the U.S. Mint create two $1 trillion platinum coins in order to bailout Main Street America?
Congresswoman Rashida Tlaib (MI-13) has proposed the “Automatic BOOST to Communities Act” in response to the Coronavirus crisis. The Act would provide a U.S. Debit Card preloaded with $2,000 to every person in America. Each card would be recharged with $1,000 monthly until one year after the end of the coronavirus crisis.
Denmark’s parliament passed an emergency coronavirus law on Thursday giving health authorities powers to force testing, treatment and quarantine with the backing of the police.
As the Federal Reserve slashes the cost of money to zero, Coronavirus is requiring closures, cutbacks and social distancing.
Indebted companies are feeling pressure as funding markets dry up.
The coronavirus pandemic is shocking markets. The United States is now grappling with the disease. Volatility in major indexes have business on edge.
While precious metals have long been a store of value, they are not practical for using in everyday transactions. You would need to hold the coins on your person whenever you went to a store. While transacting with gold might make sense for a central bank, it doesn’t make sense for most people and institutions. But, a gold-backed debit card changes this. With a gold-backed debit card, which is a card backed by gold stored in a vault, now gold buyers can hold the metal in their wallet alongside their other debit cards. Here is how it all works.
Once vegetarians had their chance to chow down on a vegetarian burger that bleeds, Beyond Meat took the investing world by storm with the biggest IPO of 2019. Since then, as the veggie burger has landed on the shelves of more and more stores, debate has turned to whether its share value is sustainable. At the time of writing, Beyond Meat shares trade at $74.36.
Moody’s Investors Service has downgraded the outlook for global banks. Slowing growth, low interest rates, and volatile operating conditions turned the ratings firm’s outlook on banks from stable to negative.
Trade tensions between the U.S. and China “appear entrenched, with negative consequences for banks in those countries as well as in other export-oriented economies and for banks funding trade,” Moody’s said.
There are several reasons experts presently warn of potential economic downturn. China’s growth has been slowing, despite recent positive reports, as the trade war wages on and geopolitical tensions increase. Among others, countries like Singapore and South Korea, who export manufactured goods to China, are slowing.
Positive economic signs do persist, with consumption remaining steady at 2%, and private residential investment increasing in the third quarter of 2019. (though this has steadily declined since the end of 2017). Despite this, business investment has begun to fall.
Bitcoin mining emissions were on par with Estonia, suggesting that the climate change impact of the first digital asset is less than previously reported. Furthermore, the research seems to suggest that where Bitcoin is mined contributes to how much carbon Bitcoin emits. With so much of the mining being done in China, one might wonder if that country’s infrastructure is more to blame than Bitcoin.
Artificial intelligence is not just coming for the jobs of barbers and baristas. It is coming for high-paid professions, too. Even financial professionals could see increasing pressure from technology, too.
According to a recent Brookings Institution report, white-collar jobs and occupations requiring higher education, as well as production workers, will see their jobs eaten by AI. The report uses a new analysis of patent data by Stanford University graduate student Michael Webb.
Global debt will reach more than $255 trillion, according to the Institute of International Finance. Nearly $32,500 for each for the 7.7 billion people on the planet.
At the end of their report, economists warned that “high debt burdens could curb efforts to tackle climate risk.”
The IIF reported: “Global climate finance flows remain far short of what’s needed for an effective transition to a low-carbon economy.”
350 Bankers and financial industry professionals think the United States will be the first to create a global digital currency – not China.
37% of attendees of the ACAMS anti-money laundering (AML) and financial crime conference, when asked by Chainalysis, said they believe the U.S. would be the first to launch the first worldwide digital currency over the next five to ten years.
Treasury Department officials are reportedly rolling back a tax rule issued under former president Barack Obama’s administration. The rule sought to prevent American companies from moving money offshore in an effort to avoid US taxes.
The Treasury issued final regulations that eliminated documentation requirements dating back to Obama. The department will propose regulations in the future changing other parts of the offshore tax rules.
David Marcus is leading up Calibre, Facebook’s cryptocurrency project. As reported by CNBC, he said Wednesday that Bitcoin is digital gold, and not a good currency for transactions.
“I don’t think of Bitcoin as a currency,” Marcus told an audience at the New York Times DealBook Conference in New York. “It’s actually not a great medium of exchange because of its volatility. I see it as digital gold.”
One Country, One System?
China could change its “one country, two systems” arrangement that has been in place since 1997. The agreement stipulates that the United States is legally bound to treat Hong Kong separately from mainland China for matters concerning trade and economic policy. With troops from the mainland at the border of Hong Kong, the protests and trade war could escalate.
Bakkt futures and custodial exchange traded 50 BTC (~$400,000) in daily futures contracts during its second week of trading, a significant decline from its opening week, as reported by WSJ.
$5.8 million was traded on Bakkt, which was created by the Intercontinental Exchange, during its first week. The following week traders moved but $2 million. That is just $400,000 daily trading volume.
Last week, almost every major online brokerage company – including Charles Schwab (SCHW), TD Ameritrade (AMTD) and E-Trade (ETFC) – stopped charging commissions, making it free to trade.
“For every broker out there, trying to sell services with explicit fees is going to be almost impossible. The next frontier will be centered around providing more financial well-being solutions — expanding beyond just brokerage products,” said Bill Capuzzi, CEO of Apex Clearing, a custodian of securities on behalf of brokerage firms.
The International Monetary Fund must choose to either make more than $5 billion in funds under Argentina’s loan deal available to the government facing default or not. The IMF had agreed to a $57 billion line of credit with the South American nation last year, and funds were meant to be paid this month.
But pro-business President Mauricio Macri took a defeat in a primary election last month, resulting in a crash of the peso and capital controls. Populist candidate Alberto Fernandez is considered the front-runner to win the Oct. 27 election. And now there is doubt about whether or not the IMF will disburse the cash until after the election.
Spot gold hit a six-year high late last week. It is the first time since April 2013 prices soared so high – peaking at a value of $1,5334.31 an ounce. Due to this price bump, US gold futures rose by roughly 1.3% to $1,537 an ounce. Despite the positive momentum, these high levels could not be sustained over the weekend.
Several factors drive the current and future value of gold and silver. Weakness in the Argentine Peso, civil unrest in Hong Kong, and the US-China trade war has forced investors to seek safehaven.
The US Securities and Exchange Commission continues to delay its Bitcoin ETF decision on the Bitwise Bitcoin ETF Trust and the VanEck SolidX Bitcoin Trust, while Bakkt claims its acquired a New York state trust charter through the New York State Department of Financial Services (NYDFS), enabling the company offer its physically-settled bitcoin futures contracts.
For the cryptocurrency community, the Bitwise and VanEck delays are nothing new. Rejection or approval of those investment vehicles will now have to wait until October 2019.
Western Union shares declined Tuesday amid the Facebook announcement of its new cryptocurrency, Libra, which is supposed to be integrated with Facebook, and its subsidiary apps Instagram, WhatsApp, and more. Western Union, a legacy consumer-to-consumer money sending platform was among the worst performers on the S&P Index on Tuesday, as it fell 2.4%. It closed at $19.57 a share.
Facebook’s cryptocurrency Libra is supported by a legion of well-known companies from both within the crypto industry and outside of it, including payment companies like Visa, Mastercard and PayPal. Blockchain companies involve Coinbase, Xapo and others. The cryptocurrency is expected to launch in the first half of 2020.
Huawei, the Chinese telecommunications giant the U.S. government fears could be used by the Chinese government to spy and sabotage infrastructure, is a crucial contributor to the development of fifth-generation (5G) mobile networks worldwide. Yet, Washington’s fear led the Commerce Department to add Huawei to its “entity list” in May 2019, forbidding Huawei to buy U.S. goods without permission from the government.
Huawei, which is the world’s biggest seller of telecommunications equipment like new 5G network infrastructure and second-largest smartphone maker, is based in Shenzhen, China. It helps connectivity in some rural areas in the US.
Binance, the world’s largest cryptocurrency exchange, announced that starting in September it will disallow U.S. residents from using its flagship exchange. Instead, it will launch a U.S.-based service, called Binance US, where U.S. passport holders will face restrictions when using the website.
Binance has been known for letting anyone use its services to trade tokens. The Malta-based exchange will partner with Bam Trading Services, a FinCEN-registered company with links to Binance-backed Koi Compliance, the “fully-managed solutions” department of over-the-counter (OTC) crypto trader Koi Trading. Binance Labs invested $3 million in Koi Trading on January 24.
Despite increased tensions in the Middle East between the Iranian Republic and the U.S. over attacks on two ships in the Strait of Hormuz, crude oil was down for the week. President Donald Trump said that Iran was behind attacks on two fuel tankers in the Gulf of Oman.
“It was them that did it,” Trump said on Fox. “We will see what happens. We are being very tough on sanctions … We’re going to see how to stop (it),” Trump said, before claiming that because of his policies “they are pulling back from everywhere.”
The President did not outline his plans for a response, and neither did Secretary of State Mike Pompeo, who cited intelligence, the weapons that were used, and the sophistication of the attack as evidence for Iran’s involvement in the assault against “freedom-loving nations.”
More Quantitative Easing (QE) could be coming to the US and Eurozone as soon as the end of the year. The European Central Bank is preparing to cut interest rates and start a new round of bond purchases come Autumn to stymy economic uncertainty amid a global economic slowdown. The Federal Reserve has indicated that it too is considering aggressive asset purchases.
ECB Bank president Mario Draghi has made it clear that all options are on the table for the ECB, which oversees an export-driven European economy that is currently enduring a considerable slowdown due to the German economy’s poor economic indicators, tensions between Brussels and Italy over the latter’s budgetary policy, as well as the threat of a No Deal Brexit.
Beyond Meat ($BYND) shares moved higher once again Monday morning. The stock persists at higher than expected levels after one of the most successful IPOs of 2018 2019 so far.
The next closest IPO of 2018-2019 has been Zoom Video ($ZM) which is up a mere 185% compared to Beyond Meat’s 600%. For comparison Uber ($Uber) is down 3% while Lyft ($LYFT) is down 18%.
Top Federal Reserve policymakers might cut interset rates if trade tensions continue to get worse.
Fed Chair Jerome Powell and his No. 2, Richard Clarida are watching disputes between the US and its trading partners. The next meeting of the Federal Open Market Committee takes place June 18-19, with Clarida noting that the Fed “can’t be handcuffed” by market pricing.
The Uber stock trend is still unclear this morning after increasing 1% Friday. Uber lost $1 billion last quarter, which is not as bad as…
Beijing is threatening to cut Washington off from rare earth minerals, according to media reports in China’s papers that included quotes from the state planning…
With Brexit still looming over the UK, and the end of Theresa May’s leadership putting the country in yet another stage of transition, the pound…
The U.S sanctioned a network of Iranian companies worth billions on Tuesday, including banks and funds accused of financing the country’s paramilitary apparatus. Washington’s move…
A bull market is when stock prices continue increasing by 20 percent from a previous drop of 20 percent, or when the securities market keeps rising. Bull markets can also refer to other markets like housing, investment, or commodities.
Mauricio Macri, President of Argentina, stated that a revamped arrangement with the International Monetary Fund (IMF) will help boost investor confidence in the country after a financial crisis forced South America’s second-largest market to a recession.
“We are working with the IMF and we are going to present something that will bring confidence,” Macri said. “More confidence than what we’ve had in the last 10 days when markets have turned around and things are moving better.”