Category Archive : Finance

Renowned Global Investor Predicts Fall Of US Dollar And Bets On Chinese Market

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.
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Betsy-Devos

Betsy DeVos Loses Student Loan Forgiveness Lawsuit, Indebted Students Still Commiting Suicide

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

Dow Surges Despite Trump’s New Tariffs On $200 Billion Worth Of Chinese Goods

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

Venezuela Economic Crisis

40% of Venezuelan Businesses Close After 3000% Minimum Wage Increase

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.”

Big Bank Experts Predict Global Economic Crisis Like 2008 Crash

Professionals at investment bank JPMorgan say the next global economic crisis will start in 2020.

Experts say the recession due to occur in two years will be less impactful than the 2008 crash, which sent the globe into recession and has been named the worst recession ever. Read More

Elon Musk Smoking Cannabis On Joe Rogan Didn’t Affect Tesla Shares For Long

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 Recover After Kaepernick Advertisement Sparks Boycott

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 Introduces New Startups To Launchpad Studio, Partners With Four Indian Banks

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.

Cloudy Earnings Season Might Spell Troubled Water for Economy

(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.

 

Goldman Sachs Wants to Mine Asteroids and Run Bank with APIs in “Radical Future” Vision

goldman-sachs-hq-is-worth-176-million-less-now-than-it-was-last-year

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.”



JP Morgan’s Blockchain Researchers Discussed Ethereum’s Shortcomings Before DAO Hack



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.

Related: JPMorgan Publishes Code for Permissioned Blockchain

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.”


Idaho House of Reps Doesn’t Want to Tax Capital Gains on Gold

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.

Related: China and Russia are Stockpiling Gold

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.



Image: Shutterstock

NTR Launders Money for “Modern-Day Pablo Escobar”




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.” 

The European Union Wants to Create a Public Bank for Continent’s Toxic Debt



big-banks

£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.

Related: The Truth About Gold Buying in Europe

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.



China & Russia are Stockpiling Gold



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