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. Read More
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. Read More
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. Read More
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. Read More
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. Read More
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. Read More
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.” Read More
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. Read More
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. Read More
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.” Read More
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. Read More
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. Read More
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. Read More
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. Read More
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. Read More
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. Read More
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. Read More
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. Read More
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 $3 million in Koi Trading on January 24. Read More
Despite increased tensions in the Middle East between the Iranian Republic and the U.S. over attacks on two ships in the Strait of Hormuz, crude oil was down for the week. President Donald Trump said that Iran was behind attacks on two fuel tankers in the Gulf of Oman.
“It was them that did it,” Trump said on Fox. “We will see what happens. We are being very tough on sanctions … We’re going to see how to stop (it),” Trump said, before claiming that because of his policies “they are pulling back from everywhere.”
The President did not outline his plans for a response, and neither did Secretary of State Mike Pompeo, who cited intelligence, the weapons that were used, and the sophistication of the attack as evidence for Iran’s involvement in the assault against “freedom-loving nations.” Read More
More Quantitative Easing (QE) could be coming to the US and Eurozone as soon as the end of the year. The European Central Bank is preparing to cut interest rates and start a new round of bond purchases come Autumn to stymy economic uncertainty amid a global economic slowdown. The Federal Reserve has indicated that it too is considering aggressive asset purchases.
ECB Bank president Mario Draghi has made it clear that all options are on the table for the ECB, which oversees an export-driven European economy that is currently enduring a considerable slowdown due to the German economy’s poor economic indicators, tensions between Brussels and Italy over the latter’s budgetary policy, as well as the threat of a No Deal Brexit. Read More
Beyond Meat ($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%. Read More
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. Read More
In the first three months of 2019, Uber brought in over $3 billion in revenue, marking a 20% jump from the same quarter a year earlier. Uber did not, however, offer its full-year revenue, which dampened confidence in the stock’s outlook due to a lack of transparency.
Uber’s stock fell immediately upon its IPO, finishing one day lower than it started, and have yet to trade at or above the value set for its initial offering. Its stock was up over 1% during early trading on Friday.
The ride-hailing and food delivery company is still expanding while fending off South American competitor Didi, while Lyft is formidable competition.
Uber’s first-quarter earnings report released Thursday revealed that Uber’s pricing would soon increase while its growth slows. Uber has relied on cheap wages for its drivers and subsidizing fares.
“We expect to deploy fewer consumer promotions in Q2 of 2019,” Chief Financial Officer Nelson Chai said.
Uber shares gained after the stock market closed on Friday. The shares gained 70 cents, or 1.76%, to $40.50 in early trading on the New York Stock Exchange. The company sees long-term profitability in autonomous vehicles.
Lyft shares increased more than 5% on Friday, gaining more than $800 million in value. The market cap is now $16.8 billion compared to Uber’s $67 billion. Just like Uber, Lyft has incurred large losses thanks to consistent promotions. Lyft reported an adjusted per-share loss of $9.02.
“While there is no guarantee that this will last, we believe that over the next 12 months both will focus more on competing via service innovations (micro mobility, loyalty etc), which should provide a significant tailwind to Uber’s unit economics,” Atlantic Equities analysts wrote in a note Friday, upgrading its rating on Uber from neutral to overweight.
Now that both ride-sharing services are public, riders can expect fewer deals. But, if price point becomes a determining factor for riders, then Uber likely has the advantage, since Lyft is a quarter of the size of Uber.
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 agency. The stocks of rare earth producers were up following the news.
One newspaper included the Chinese phrase “don’t say I didn’t warn you”, which the country used before it went to war with India. The paper wrote “those familiar with Chinese diplomatic language know the weight of this phrase.” The language, which appeared in the Global Times, a newspaper affiliated with the Communist Party, was also employed ahead of conflict between China and Vietnam in 1979.
The People’s Daily made it clear China would use the elements as retaliation in its trade war. 80% of U.S. rare earth supplies come from China.
The editor-in-chief of the Global Times tweeted that China is “seriously” weighing the restriction of rare earth exports to the U.S. and could also implement countermeasures.
A National Development & Reform Commission official told CCTV that people in the country won’t be happy to see products made as exported rare earths are being used to suppress China’s development. Editorials in the Global Times and Shanghai Securities News took similar stances in their Wednesday editions.
The U.S. is dependent on importing rare earth minerals from China, which are used in electronics, hybrid vehicles, and energy storage systems. The U.S. imports the rare earth materials because it’s cheaper than producing them domestically.
This is driving rare earth stocks up with the help of President Xi Jinping, who visited a plant earlier this month along with his chief trade negotiator with the U.S.
China already raised tariffs on America’s sole producer of rare earths from 10% to 25%. The U.S., however, excluded rare earths from its list of prospective tariffs on roughly $300 billion in Chinese goods.
In December 2017, U.S. President Donald Trump signed an executive order to reduce the country’s dependence on external sources of critical minerals, including rare earths, which was aimed at reducing U.S. vulnerability to supply disruptions.
China’s rare earth market:
- China Northern Rare Earth Group
- Minmetals Rare Earth Co.
- Xiamen Tungsten Co.
- Chinalco Rare Earth & Metals Co.
Shares of JL Mag Rare-Earth increased by 10% while Innuovo Technology increased by 9.95%. The shares of Australia rare earth miner Lynas also increased by more than 10%.
“We’ve been here before,” Fraser Howie, an independent analyst, told CNBC’s “Street Signs” on Wednesday. China banned the export of rare earth minerals to Japan after Tokyo detained a Chinese fishing trawler captain.
Norway’s exports of salmon plummeted after Beijing curbed them. That move was seen as retaliation to a Norwegian committee’s decision in 2010 to award a Chinese dissident the Nobel Prize.
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 has endured its longest losing streak against the euro since the creation of the latter currency 20 years ago. In recent weeks, the sterling has recorded its steepest losses ever when compared to major world currencies.
The pound dropped from just over €1.17 to under €1.14. It fell from over $1.32 to less than $1.27 versus the dollar – its lowest level since February.
Financial markets have declined over the past month over US and China trade war fears. Donald Trump’s administration raised the stakes by ramping up US tariffs from 10% to 25% on $200 billion worth of Chinese imports. Tensions raised as the US blacklisted the Chinese telecoms company Huawei. The FTSE 100 has fallen by more than 2% to trade at about 7,270.
UK inflation increased to above the government’s 2% target in April. Last week, U.K. Prime Minister Theresa May resigned as the leader of Britain’s Conservative Party.
“It is and will always remain a matter of deep regret to me that I have not been able to deliver Brexit,” said May outside No. 10 Downing St. in London during a speech at the end of which she shed a tear. May spent nearly three years trying to deliver the result of the 2016 Brexit referendum.
The Bitcoin Brexit Boon
According to one expert, increasing numbers of millionaires in the UK are moving their cash into cryptocurrencies, such as Bitcoin, due to fear over the possibility of a Jeremy Corbyn-led government.
With Conservative Party support waning thanks to Brexit chaos, a Corbyn-led Labour Party could take power. Nigel Green, founder and CEO of deVere Group (which has more than $12 billion under its advisement), believes the nation’s rich, fearing such a result, are turning to Bitcoin and Ethereum.
“High-net-worth individuals in Britain and wealthy international investors with UK assets and business know that they will be hit by Mr. Corbyn’s tax hikes on wealth, income and inheritance,” Green said. “As such, many of them aren’t waiting to find out how his anti-wealth rhetoric would play out, and more and more of them are seeking advice on established, legitimate overseas opportunities to create, build, and importantly, protect their wealth.”
He adds: “An increasing conversation we’re having with clients in this regard involves investing in cryptocurrencies, such as Bitcoin, Ethereum and XRP, in lower tax, crypto-friendly jurisdictions. In a broader sense, high-net-worth individuals are increasingly seeking exposure to the associated benefits of these digital assets as our recent global survey highlights. It can be expected that a Corbyn-led government will help fuel this trend.”
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 increases pressure on Tehran, sending a message to governments and companies still working with Iran to stop or face penalties.
The U.S.’s goal in targeting the Basij militia’s financing network, emphasizing the network’s use of child soldiers and other humans rights abuses in its announcement of the sanctions, is to undermine the financing of the prominent Islamic Revolutionary Guard corps unit and disincentivize the doing of business with the nation.
“The IRGC is pervasive within the Iranian economy,” a senior administration official said. “This is precisely the kind of activity that we have warned other companies and governments about extensively.”
Firms are leaving Iran as the U.S. increases sanctions meant ensure Tehran renegotiates a new nuclear and security deals that addresses Trump administration concerns, writes the Wall Street Journal.
Companies and governments in China and Europe may still trade with Tehran in order to have access to the country’s oil – effectively amounting to an opposition to Washington’s having left the 2015 Iran nuclear deal.
U.S. Treasury sanctions claim Basij’s ownership of banks and companies spans across the entire Iranian economy. These entities are subject to U.S. sanctions effective November 5 – the second phase in Washington’s new pressure campaign meant to cut Iran from financial and trade ties to the world.
Human-rights groups condemned the sanctions, which were announced on Tuesday. The European Union and other Western governments blacklisted the sanctions. Companies or banks could face U.S. penalties for preserving ties with Iran.
Alireza Miryousefi, spokesman for Iran’s mission to the United Nations, called the sanctions a “unilateral campaign of bellicosity against Iran.”
The Treasury says Mehr Eqtesad Bank is integral to the Basij network. U.S. officials claim it provides hundreds of millions of dollars to the militia’s foundation through dividends and interest-free credit lines.
Bank Mellat, which in part financed Iran’s nuclear program, sent similar amounts to Mehr Eqtesad Bank, claims the U.S..
“This vast network provides financial infrastructure to the Basij’s efforts to recruit, train and indoctrinate child soldiers who are coerced into combat under the IRGC’s direction,” U.S. Treasury Secretary Steven Mnuchin said. “The international community must understand that business entanglements with the [Basij] network and IRGC front companies have real world humanitarian consequences.”
A senior U.S. official added: “We’re going to make sure, whether it’s through SWIFT or through other means, that sanctions are enforced. If there are prohibited transactions, going through SWIFT or any other entity, we’re going to make sure we enforce those sanctions quite vigorously.”
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. Read More
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.” Read More
Jim Rogers, author of “A Bull in China: Investing Profitably in the World’s Greatest Market” and a renowned investor who co-founded the first global investment fund with George Soros in 1973, has made numerous extraordinary predictions about trade market in the past, including the fall of the US dollar.
A new ruling from a federal judge means the U.S. Department of Education has delayed student loan forgiveness for some.
The Attorneys general of 19 states, as well as the Districct of Columbia, sued U.S. Secretary of Education Betsy DeVos and the U.S. Department of Education for delaying a borrower protection rule scheduled to take effect on July 1. Read More
The latest tariffs on American and Chinese goods aren’t as severe as expected, making stocks rise on Tuesday. Substantial profits in tech also propelled market gains.
The S&P 500 increased 0.5 percent to close at 2,904.31, headed by buyer discretionary spending and industrials. It is also less than half a percent from its record high. Read More
Venezuelan workers who got a pittance are now getting a slightly higher pay, thanks to a 3000% increase in their minimum wage. What they may not have, though, are jobs.
Seven million employees are now guaranteed 1,800 bolivars per month, which is worth about $20 at the black-market rate, after a minimum wage hike. Venezuelan President Nicolas Maduro proposed the change to increase his popularity, but it’s having the opposite effect. Businesses, already hit by Venezuela’s financial collapse, tell employees they can’t afford to pay them.
“The government sector has the monopoly on imports, the currency market is dysfunctional and there’s hyperinflation,” said Economist Orlando Ochoa. “So, if salaries are increased by decree, and the commercial and industrial sectors cannot sell their products because of these problems, and on top of that because of electricity blackouts, infrastructure problems and the loss of qualified personnel, which is leaving the country, then it’s easy to understand that many may prefer to close.”
Even though there have been multiple comparable moves in the past, none has ever been so disruptive, arriving amid a depression, hyperinflation, and devaluation.
Some companies are restructuring expenses and arranging settlements with employees. Other businesses are just firing workers. Much of the development occurs secretively as employers attempt to evade backlash by the government, which has been detaining those it considers are breaking the rules.
“We have inspections, and they force us to sell at last month’s prices,” said María Carolina Uzcátegui, president the National Council of Commerce and Services of Venezuela. “That takes money away from the business because of the hyperinflation when you can’t even sell at yesterday’s prices because you lose money.”
She adds: “And anyone who protests against these measures runs the risk of going to jail, without the right to appeal, without the right to anything, simply because the official whose turn it was to inspect the store just felt like arresting you. He did it, and that’s all.”
Marcos Vizcaino, 56, a garage owner in Caracas, stated that the wage rise was the definitive setback for his family business of two generations. Vizcaino said the lack of spare parts and hyperinflation had already complicated matters and ended up bringing in less than one customer each day.
“I already told my four employees to go find other jobs,” he said. “I’ve decided to close. There’s no need for me to keep losing money for a third year in a row.”
Elon Musk appeared as a special guest on The Joe Rogan Experience podcast last week. When Rogan lit up a tobacco-cannabis hybrid cigarette – often referred to as a butt – after two hours of interview, he assumed Musk would decline due to the inevitable backlash from Tesla and SpaceX shareholders. Read More
Nike shares recovered their losses on Monday after their contentious publicity campaign featuring former San Francisco 49ers quarterback Colin Kaepernick initially spurred a drop in their shares. The campaign, released to celebrate Nike’s 30th anniversary of their slogan “Just Do it,” sparked both backlash and support of the brand. Read More
Google just introduced a new group of startup businesses into Launchpad Studio, the tech behemoth’s accelerator it launched last year that matches top machine learning startups and experts from Silicon Valley with Google – its people, network, and advanced technologies.
While the accelerator’s first group was meant to gather new insights from medical data, this most recent one is meant to shake up well-known financial markets and systems.
Accurately reviewing and analyzing millions of data points tied to locations, demographics, and financial situations will result in information helpful to the financial sector.
Some of the new startups include:
Celo (USA) – growing financial inclusion through a mobile-first cryptocurrency.
GuiaBolso (Brazil) – improving the economic lives of Brazilians.
Starling Bank (UK) – improving financial well-being with a mobile-only bank.
Frontier Car Group (Germany) – investing in the ever-changing process of used-car marketplaces.
Inclusive (Ghana) – verifying identities across Africa.
Aye Finance (India) – remodeling financing in India.
m.Paani (India) – powering local businesses and the next one billion users in India.
India and the United States are the only countries with more than one business in Google’s latest Launchpad Studio accelerator additions – With two startups coming from these countries.
In addition, Google is partnering with four Indian banks to issue customer loans online, as the battle for the $1 trillion digital finance market persists.
The banks partnering with the search engine are HDFC Bank, ICICI Bank, Kotak Mahindra Bank, and Federal Bank.
They will offer instant, pre-approved loans to consumers “right within Google Pay in a matter of seconds.”
Google also re-branded its made-in-India Tez app, launched in September, as Google Pay.
The app’s users can take out customized loans and get the funds transferred straight into their bank account.
“We’ve learned that when we build for India, we build for the world,” Caesar Sengupta, vice-president of Google’s Next Billion Users initiative and Payments, said at the “Google for India” meet in New Delhi.
Over 55-million people in more than 300,000 towns and villages have downloaded Google’s payments app to pay for dinner, bus rides, or other services.
In total, Google estimates about $30 billion in annual transactions through the Tez app.
Google also announced that it’s expanding its Google Station internet access program to 12,000 villages and cities throughout the Indian state of Andhra Pradesh.
The search-engine will add more Indian language content through a publishing venture called Project Navlekha, and will also add a new feature in Google Go that allows users to listen to websites read aloud in English and five different Indian languages.
(Gold Silver Bitcoin) Companies aren’t letting investors know what to expect ahead of earnings season. Less than 100 have published their expectations, the least amount since Bloomberg began keeping track in 1999. The latest drop in reports is the quickest on record, down 35% from a year ago. Investors are concerned about a pullback in car sales and a slowdown in merger and acquisition activity.
“There are some warning signs that are getting darker,” said BlackRock’s Larry Fink, in an interview Wednesday on Bloomberg Television.
Gasoline, wireless telephone services, used cars and trucks, new vehicles and apparel all led the declines in the Consumer Price Index.
March figures for U.S. automakers were less than expected and provided evidence that the U.S.’ boom cycle in car sales could be declining. General Motors Co and Fiat Chrysler Automobiles shares both declined nearly 4 percent. Ford Motor Co.
Reports indicated that lenders may have been behind the decline in auto sales last month. Verizon Communications Inc reported Thursday that results fell short due to a drop in subscribers paying a monthly bill despite its launch of unlimited data plans. Share declined 2.3% to $47.80 while net income attributable to Verizon dropped to $3.45 billion from $4.31 billion, or $1.06 per share, a year earlier. Total operating revenue fell to $29.81 billion from $32.17 billion a year prior.
After having reached an all-time high on March 1, the S&P 500 Index has been confined to a 55-point range. One week it gains. The next it loses. Deutsche Bank AG showed the Index demonstrated its lowest volatility to begin a new year since 1965.
The US government reported on Friday that price inflation in the US fell for the first time in 13 months (-0.3%). The year over year rate decreased to 2.4%, overshooting the Fed’s goal, but still below the historical average of 3.3%.
Gold suffered its largest one day drop in over six weeks leading into the French presidential election wherein both far-right and far-left candidates could be elected, though centrist candidate Emmanuel Macron apparently is in the lead. The euro increased to a three-week high against the U.S. dollar after Trump made comments that the dollar was too high.
Gold increase 0.16 an ounce to $1,281 an ounce, hitting a five-month high of $1,295.42, then declining. “Even though momentum has been positive there are other factors preventing a quick move higher from here – the sentiment is still that there will be stronger data from the U.S., and yields will probably rise. That will likely limit the upside (for gold),” said ABN Amro analyst Georgette Boele.
Equities increased marginally in Europe and the United States decreased safehaven buying demand behind gold. Holdings of the world’s largest gold-backed exchange-traded fund, New York-listed SPDR Gold Shares, the world’s largest gold backed exchange-traded fund, increased 11.8 tonnes on Wednesday – their biggest one-day inflow since September.
“While the metal is well positioned for a test of $1,300 with geopolitical concerns underpinning its safe-haven status, the failed tests of $1,290 are beginning to weigh upon investor
confidence,” MKS said in a note.
“Supply will struggle to register any growth, and indeed is likely to show a small decline following unusually high production in Russia in 2016. Demand, on the other hand, will continue to expand,” said Johnson Matthey Precious Metals Management in a quarterly report. “Higher vehicle production, combined with an increase in average catalyst loadings at a global level, will drive autocatalyst demand for the metal to another record level.”
Spot palladium increased 3.2 percent to $799.58 an ounce, on track for its biggest one-day jump since early February. Silver, down 0.4 percent at $18.01, while platinum was up 1.1 percent at $973.24.
The experts are optimistic, expecting 9.7 growth in S&P 500 earnings for the March quarter, 12 percent for the full year. Growth estimates were zero as reporting season drew near.over the past two years.
Fink anticipates a 5-10 percent correction. “If we don’t have earnings validated in these higher P/Es we could adjust downward 5 or 10 percent from here,” Fink said. “If the administration does succeed on some of these items then the market will then reassert itself going higher.”
The data in toto could point towards a bearish economic outlook – an excuse for the FOMC to leave interest rates.
A good sign for safehaven assets like cash, bitcoin, gold and silver.
An asteroid just passed earth. It had £3.7trillion worth of platinum on board. Goldman Sachs wants to mine that platinum.
The multinational financial company holds futuristic visions of tomorrow, starting with the “realistic” goal of mining asteroids for trillions of dollars worth of platinum. But, the bank’s plans don’t end there. Goldman Sachs wants to transform its business model here on Earth via APIs – and, yes, the plan will cost human jobs.
Noting that asteroids can be rich in mineral platinum – which grows scarcer and scarcer here on earth – Goldman Sachs has carved out a plan to procure more for human resources in a plan of science-fiction proportions.
Related: China & Russia Are Stockpiling Gold
Platinum, which costs $1 million per one thousand cubic centimeters, sits at just under $1,000 per troy ounce on terrestrial markets for investment bullion grade metal, which is referred to as the ‘rich man’s gold.’
“While the psychological barrier to mining asteroids is high, the actual financial and technological barriers are far lower,” reads a Goldman Sachs report. “Prospecting probes can likely be built for tens of millions of dollars each and Caltech (University) has suggested an asteroid-grabbing spacecraft could cost $2.6 billion [£2.1 billion].”
The firm adds: “Space mining could be more realistic than perceived.”
Goldman Sachs warns that mining asteroids for platinum could destroy platinum market dynamics, undermining the scarcity of metal, which is mainly mined in Russia and South Africa by workers paid very little.
“According to a 2012 Reuters interview with Planetary Resources, a single asteroid the size of a football field could contain $25bn- $50bn worth of platinum,” states Goldman Sachs. “Successful asteroid mining would likely crater the global price of platinum, with a single 500-meter-wide asteroid containing nearly 175X the global output, according to MIT’s Mission 2016.” This won’t deter Goldman Sachs.
“We expect that systems could be built for less than that given trends in the cost of manufacturing spacecraft and improvements in technology,” the investment bank surmises. “Given the capex of mining operations on Earth, we think that financing a space mission is not outside the realm of possibility.”
Further, Goldman Sachs’ deputy chief financial officer Marty Chavez portends a “radical future” for the Wall Street Bank back down on earth.
“We’re packaging everything we do, and actually, we’re redesigning the whole company, around APIs,” said the executive officer of the bank earlier this year.
Lloyd Blankfein, the chief executive of Goldman Sachs who once said the bank was doing “god’s work” felt Mr. Chavez needed a mentor.
Mr. Chavez, on his way to becoming the bank’s chief financial officer, received an email from Eric Schmidt, chairman of Google’s parent company, Alphabet.
“Hey Marty, I’d like to come over to your office to introduce myself,” the tech executive wrote.
“We’ve been talking ever since about the similarities in the businesses,” Chavez told a group of computer scientists at the Harvard Institute for Applied Computational Science earlier in 2017. “Some of the similarities are aspirational, I have to emphasize that, and some are there right now.” The YouTube video of the talk was recently released, and has been viewed approximately 2,000 times.
“Goldman is for risk what Google is for search,” as Chavez sees it.”Google produces software services, and those software services aggregate the attention of billions of people, and then Google sells the attention of billions of people to advertisers.”
As for Goldman Sachs?
“A client has a risk they don’t want or wants a risk they don’t have, and we make it happen for them,” Chavez explained. “This is the fundamental truth of Goldman Sachs. If the clients stop calling and talking to us about risks they have but don’t want or want but don’t have, then we have no business whatsoever.”
Goldman Sach’s Data Lake, which pools data on transactions, markets, and investment research, as well as insights from emails, voice calls and instant messages. The bank applies machine learning to the data it accumulates. The result is a guide for employees.
“What really makes us valuable is the immense amount of data that we have,” Chavez said. “In this job of inspiring our clients to call us because they have risks they don’t want or want risks they don’t have, there is incredible information content, and using that for the benefit of the clients to get a better result is what we’re up to.” Mr. Chavez compared how Google operates to Wall Street’s status quo.
“Imagine if Google had gone a slightly different route and they said, ‘Every time somebody wants to do a search, they pick up the phone, call their Google salesperson, read the search terms to the Google salesperson, who types them into the internal Google search engine, gets the results, and then reads them back over the phone,’” he pictures.
He mentions: “That is not the route Google took. Unfortunately, that is a pretty good description of how Wall Street works.”
The new Goldman Sachs is based on APIs if Chavez, who highlights the success of Salesforce, eBay and Expedia API revenues, gets his way.
“Historically, the API has been human beings talking to other human beings over the telephone, and all the tools, the content, the analytics is on the internal platform only,” Chavez said. “We are shifting this radically and shifting this fast, and we’re packaging everything we do, and actually, we’re redesigning the whole company, around APIs.”
He adds: “We’re turning all of the verbs, all of the activities at Goldman Sachs, into APIs,” Chavez said. “One of the things we’re insisting on is a very high standard of lovely and impeccable documentation for these APIs, because we’re opening up the vertical monolith which used to have only one API point, which was human beings on the phone.”
When two senior blockchain leaders left JP Morgan’s Juno project last month to start the firm Kadena.io, as reported by Quartz, it was on amicable terms.
JPMorgan & Kadena Partnership In The Works?
In fact, former executive director Stuart Popejoy and JP Morgan head engineer Will Martino – who use South Park caricatures on the website in their biographies – are currently exploring a partnership with their former employer, the largest bank in the United States with total assets of $2.35 trillion.
Kadena’s conversations with JP Morgan revolve around both the initial pilot of the Kadena self-titled blockchain and other use-cases, and a relationship with the bank could be formalized in the next few months with Kadena either as a vendor or partner. Spinning off from JP Morgan was “definitely” a professional decision for Popejoy and Martino.
“Our decision was based on the belief that the true potential of the Juno pilot would be best-served by an independent effort,” Martino told Motherboard, referring to JP Morgan’s blockchain project.
DAO Hack Foreseen By JPMorgan
Martino’s and Popejoy believe their work serves as an improvement over Ethereum. Martino and Popejoy say Kadena’s technology would avoid blockchain crises such as the June $56 million DAO hack of Ethereum’s token, ether.
Like Ethereum, Kadena’s blockchain technology can handle payment clearing use-cases, but that’s just an “added bonus of private utility-like blockchain technology,” as Martino says. He believes blockchain technology can standardize business logic for inter-organizational relationships. This, he suggests, “could provide for terrific business acceleration.” At the time of the DAO hack, Kadena was preparing Pact, a safe, declarative smart-contract language.
“While bugs aren’t impossible in Pact, it represents the same sober, disciplined approach found in database engineering and Bitcoin: safety is absolutely paramount in transactional computing,” Martino said. The Ethereum hack, ultimately, confirmed a longstanding hypothesis of the Kadena founders – one they had since their JP Morgan days.
“That Ethereum’s Solidity, and indeed the EVM bytecode environment itself, is fundamentally unable to provide a safe environment for blockchain transaction execution,” Popejoy expressed.
Martino and Popejoy noticed Ethereum’s shortcomings as blockchain technology researchers in the Emerging Technologies Group at JP Morgan, which is tasked with fostering innovation within the bank. Ethereum’s design presented “a significant barrier to industry adoption of private blockchain in a multi-organizational setting.”
Is the Kadena blockchain a Bitcoin and Ethereum killer app? Popejoy and Martino believe so. Kadena can, after all, process upwards of 7,000 transactions per second. Bitcoin is currently stuck at seven transactions per second a la the “Bitcoin block size debate.” Kadena also claims their blockchain sacrifices none of the cryptographic robustness expected from a blockchain, proving full durable security. Overall, the Kadena founders foresee a paradigm shift away from public blockchains like Ethereum.
“Private blockchain solves a raft of issues for transaction processing that normally require extensive operational and engineering expertise, including database replication, reliable and performant messaging, service discovery, high-availability, and disaster-recovery,” Popejoy said. “Remarkably, blockchain solves all of these problems in a single stroke, letting IT focus efforts on solving business problems by coding transactional logic into smart-contracts.”
The Idaho House of Representatives voted by a 56-13 margin last week to cease Idaho taxation on precious metals, including gold and silver coins and bars.
Bill Sponsor Representative Mike Moyle (R) and the entire Republican caucus voted in favor of the measure. Now the Republican-controlled Idaho Senate must also vote in favor of the bill and Governor Butch Otter (R) must sign the bill.
HB 206, backed by the Sound Money Defense, Idaho Freedom Foundation, Money Metals Exchange and grassroots activists builds on Idaho’s sales tax exemption on precious metals to end income taxation on the sales of “precious metals bullion” and “monetized bullion.”
Representative Ron Nate (R), said from the House floor: “According to the U.S. Constitution, Article I, Section 10, there is only one thing that a state can declare as currency if they think that our federal currency is going out of whack and some might argue that they think our federal currency is going out of whack already. If we are not going to allow people to declare capital losses on their Federal Reserve Notes or their dollar holdings, it would also be unfair to tax people for their gold and silver holdings. Gold and silver is an alternative to holding Federal Reserve Notes and it is the ONLY alternative that the U.S. Constitution says that the state can allow as another currency. It’s unfair to tax it just as [it’s unfair] to tax losses on Federal Reserve Notes.”
Taxpayers who sell their precious metals might be on the hook for capital gain taxes. “Policies that discourage precious metals ownership reduce the likelihood that Gem State citizens will take prudent steps to insulate themselves from the inflation and financial turmoil caused by the Federal Reserve System,” said Stefan Gleason, director of the Sound Money Defense League. “Precious metals bullion is already exempt from Idaho’s sales tax. HB 206 removes the final disincentive in Idaho tax law that stands against ownership of the monetary metals.”
Utah and Oklahoma have enacted similar income tax measures. Arizona is considering similar legislation, and states like Tennessee, Maine, and Alabama seek to remove precious metals from the sales tax.
A conspiracy involving employees at NTR Metals was outlined in a criminal complaint against Juan Pablo Granda, 35, and implicates the North American precious metals refinery and trading company in a litany of serious actions.
The conspiracy involved the purchase of massive amounts of gold from illegal mines in Peru supporting human trafficking, forced labor and environmental devastation. The NTR Metals office in Miami laundered billions of dollars for criminal organizations like Peruvian narco-terrorists since it bought gold from their mines. It’s could be that the employees at the Miami office were not properly vetted by NTR’s corporate office, as no charges have been lodged against the company, a subsidiary of Elemetal.
Related: Mergers In Precious Metals Market
The U.S. complaint, filed in Miami, is part of a U.S. crackdown on smugglers using gold mined in the Amazon basin illegal where laborers use fire hoses and mercury to extract the nearly pure precious metal.
Smugglers, refineries and traders supply gold from illegal mines in Latin America, smuggling it into Miami and the international market.
A Bloomberg report outlined how one Chilean smuggler sold thousands of pounds contraband gold to NTR’s Miami office before being arrested in Santiago. NTR, based in Dallas, isn’t charged in the case. General counsel for parent company, Elemetal, did not comment.
NTR has likely been buying illegal gold since at least 2012. The company allegedly started “smuggling illegal gold through a shifting array of Latin American countries.” The company eventually imported $3.6 billion worth from 2012 to 2015, according to the complaint.
“For all of the billions of dollars’ worth shipped from Latin America to NTR in Miami, NTR sent billions of dollars in wire payments to Latin America from the United States,” HSI agent Colberd Almeida wrote in an affidavit.
Chilean smuggler, Harold Vilches, told U.S. and Chilean prosecutors that he sold 4,000 pounds of illegal gold mostly to NTR Metals Miami. Mr. Vilches said two NTR employees in Miami knew his gold was illegal and even coached him on how to smuggle it into the U.S.
In 2013, Peru seized $18 million, including some headed for NTR financed by narcotics money laundering.
Several Latin America countries have begun investigations, “many of which involve gold being sold to NTR,” Almeida wrote.
Ecuador arrested in a $400 million money laundering scheme involving gold mined in Peru and bound for NTR, the agent wrote. Chile arrested individuals regarding Peru and Argentina gold sold to NTR. NTR bought Peru, Ecuador, Bolivia, Chile, Guyana and the Caribbean from what the U.S. calls “highly suspicious gold imports.” One of these sellers refered to himself as a “modern-day Pablo Escobar.”
According to the complaint, he said: “I’m like Pablo coming to Ecuador to get the coke.”
£910BILLION worth of bad debt could collapse the European Union banking system. The “urgent and actionable” reality in Europe, which has left to increasingly radical parties claiming seats in the continent’s parliaments, has led to regulators on the continent plan for a “bad bank” contingency. Such a “bad bank” would effectively collectivize among the taxpayers the bad bets made by banks on the continent.
According to Andrea Enria, chairman of the European Banking Authority, EU’s banking problems have become “urgent and actionable.” Mr Enria recommended an EU “bad bank” be created in order to buy up toxic loans and fix the forlorn economy. The bad bank would use taxpayer funds to buy bad loans from struggling lenders.
The EU is reportedly researching the ways in which regulators can reduce failing bank loans. A report, co-written by national finance ministries, is due in March, Express UK reports.
EU banking system is burdened by €1.06trillion in toxic debt. That’s 5.4 percent of the entire EU’s total loans. Approximately 10 EU states have an average bad loan ratio of 10 percent.
Gold refineries in Switzerland sent a record amount of gold to Shanghai last December, and Russia is buying gold in droves as well, as the United States experiences a time of tumultuous politics and the european banking system is reported to be on the verge of collapse.
Figures released at the end of January by Federal Customs Administrations showed that Switzerland, a world leader in gold production, sent 158 tonnes of gold to China, a five time increase over November’s sum and nearly three times the volume in December 2015. Read More
President elect Donald J Trump took to Twitter last week to promise punitive actions for those companies who left the US. It’s hardly the sort of free trade beliefs he pushed during the election, and a nightmare scenario for US business.
Mr. Trump outlined what could become one of his legacy policies as President of the United States in a tweetstorm.
The U.S. is going to substantialy reduce taxes and regulations on businesses, but any business that leaves our country for another country,
— Donald J. Trump (@realDonaldTrump) December 4, 2016
fires its employees, builds a new factory or plant in the other country, and then thinks it will sell its product back into the U.S. ……
— Donald J. Trump (@realDonaldTrump) December 4, 2016
without retribution or consequence, is WRONG! There will be a tax on our soon to be strong border of 35% for these companies ……
— Donald J. Trump (@realDonaldTrump) December 4, 2016
wanting to sell their product, cars, A.C. units etc., back across the border. This tax will make leaving financially difficult, but…..
— Donald J. Trump (@realDonaldTrump) December 4, 2016
these companies are able to move between all 50 states, with no tax or tariff being charged. Please be forewarned prior to making a very …
— Donald J. Trump (@realDonaldTrump) December 4, 2016
expensive mistake! THE UNITED STATES IS OPEN FOR BUSINESS
— Donald J. Trump (@realDonaldTrump) December 4, 2016
Mr. Trump first tweeted,“Just tried watching Saturday Night Live – unwatchable! Totally biased, not funny and the Baldwin impersonation just can’t get any worse. Sad”
He then launched the bombshell US business policy on which there will be a tax for US companies, who re-incorporated abroad, to sell their products back to US businesses and consumers.
That Mr. Trump fails to distinguish between small and big companies – “any business” he tweets – could have implications for thousands of small and family businesses.
“The U.S. is going to substantially reduce taxes and regulations on businesses, but any business that leaves our country for another country,” Trump’s first tweet of on the subject begins, “fires its employees, builds a new factory or plant in the other country, and then thinks it will sell its product back into the U.S. ……
without retribution or consequence, is WRONG! There will be a tax on our soon to be strong border of 35% for these companies …..”
Trump spells out why: this will make it harder for US companies to escape.
Across the tweets, the President essentially threatens US companies, offering back nothing more than a promise of future low taxes for those who obey.
“these companies are able to move between all 50 states, with no tax or tariff being charged,” he tweets. “Please be forewarned prior to making a very …expensive mistake!
In a truly Orwellian ending, Mr. Trump tweets: “THE UNITED STATES IS OPEN FOR BUSINESS”
We were watching when last week Mr. Trump declared at a rally in Indiana, “companies are not going to leave the US anymore without consequences.” We waited for him to elaborate. He has.
CEO’s are asking, ‘Who’s next?’ in context of last week’s Carrier deal.
Sarah Palin called that deal “crony capitalism.” Mike Pence denied it. Mr Trump, meanwhile, uses the Carrier deal as an example of a business first approach.
Mr. Trump’s actions could disrupt balances in the ‘Chimerica’ arrangement with China, prompting a trade war so soon as his first 100 days in office.
Donald J Trump tweeted Tuesday that SoftBank of Japan agreed to invest $50 billion in the US towards businesses and 50,000 new jobs. The tweet comes on the even of Pearl Harbor, a scar on the memory of both nations. In announcing the deal, Mr. Trump makes good on a campaign promise to improve international relations.
“Companies are not going to leave the United States anymore without consequences. Not going to happen. It’s not going to happen, I’ll tell you right now,” Trump said on Thursday at a rally in Indiana as he boasted about the job’s he’d saved at Carrier, a company that purportedly planned to go to move 2,100 jobs to Mexico.
The Spanish Government acted today to cap cash payments at €1,000, down from the current cap of €2,500. Anti-fraud measures enacted today include a VAT information and increased regulation of deferred payments.
The government is working on measures against fraud, including limiting the payment in cash to 1,000 euros instead of the current 2,500. The decree is set to be approved by the Council of Ministers next Friday. The Ministry of Finance admits it could be delayed. Read More
The word “cash” means different things in some parts of the world than in the US, Europe Australia and many other of the more stable economies worldwide. The Venezuela crisis has been ongoing, but trials and tribulations in India have meant a population short on cash. Meanwhile, things are “bizarre” in Zimbabwe where dollars go for dollars..with a premium. Read More