Investment/Trends

Bigger than Libor? Forex probe hangs over banks

"A global investigation into the setting of the London interbank lending rate, and related global benchmarks, has so far yielded about $3.6 billion in fines. Penalties for some of the biggest players are still to come. Traders have also faced criminal charges. As the extent of damage caused by Libor-rigging is revealed, lawyers say the probe into fixing currency rates could unfold in a similar way, and rival its impact. London is the center of the loosely regulated foreign exchange market, the biggest in the world's financial system with average daily turnover of $5.3 trillion. Proven abuse in this market would have a significant ripple effect, exposing offending firms to a host of legal action." Continue reading →

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Bitcoin continues to swing without any help from central banks

"The euro dropped against the dollar Wednesday on yet another signal that the European Central Bank is considering more unconventional policies at the same time that the Federal Reserve has shown a willingness to slow its bond purchases. Such central-bank inspired moves are absent from bitcoin by design; the virtual currency has no central bank and is created through a process called mining. So without monetary policy as a driver, what’s behind the big moves? Surging demand in China, growing legitimacy in the U.S. as demonstrated byhearings in the Senate, the closure of the bitcoin-only drug market Silk Road, and an open-ended bitcoin trust run by SecondMarket." Continue reading →

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Bitcoin Could be Regulated as a Commodity: Senate Banking Hearing

"BitPay CEO Tony Gallippi also presented, and argued against regulation. He recommended that Congress take the same approach to bitcoin as they did to the commercial Internet in the early nineties: wait and see. 'If America is the leader in Bitcoin technology, America will create more jobs and more exports,' he said. 'If the United States doesn’t allow our businesses to accept bitcoin and create more jobs and exports, then countries like Germany and China certainly will.' He understood why banks might be nervous about virtual currencies, though, as it is a disruptive technology, which threatens to undermine their business models." Continue reading →

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Geithner Joins the Wall Street Party

"He made sure of the solvency of Wall Street and of the City and having done this for four years – and no doubt seeing that the situation was deteriorating further – he decided to head for the exit. He has moved on to take the presidency of a white shoe Wall Street firm specializing in start-up investments. It is his first 'private sector' job, we're told, but one he will be good at because of his work ethic and 'commitment to leadership.'. We've been discussing the upcoming Wall Street Party, one Geithner is inviting himself to. Warburg Pincus is a big player in venture capital investing with a main focus, according to various reports on the company, in the areas of energy, technology and healthcare." Continue reading →

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Bill Bonner: Paddywhacking

"Last week, Janet Yellen told the Senate what everyone wanted to hear: that the Fed would continue to support asset prices. With the 'Yellen put' in their pockets, investors bid up the Dow to over 16,000 by the end of the week. What to make of it? Although we have no doubt that Fed policies will prove disastrous, we have nothing but doubts about what form the disaster will take. John Williams of ShadowStats.com recalculates the Consumer Price Index, official unemployment rates and GDP figures based on more honest data and alternative methodologies. What he discovers is that the CPI is higher, unemployment is higher and the GDP is lower than the feds would have us believe." Continue reading →

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Why We’re Not Sneering at the Averages

"As we can see with modern equity markets, common sense is taking a back seat to pump-priming. There is indeed a Wall Street Party going on, as we've pointed out, and the IPO market, in fact, is a large part of it. When markets are stuffed with money, volatility certainly becomes a concern. We recall the 1987 Crash was brutal, yet markets gradually climbed afterwards, culminating in the tech boom of the late 1990s. Loose money is generally a powerful support for higher averages and stronger numbers. And yes, this could continue for a while because the REAL economy has not yet felt the full impact of what's going on in the stock market." Continue reading →

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The Manufacturing Index Reverses, Falls

"The New York Federal Reserve Bank’s latest survey indicates a slowing of the regional economy. This was not expected by economists. This is a major reversal. It took place across the boards. This could be a temporary fluke. But this is November. This is the month preceding the Christmas season. This should be a time of increasing demand. It isn’t in the New York City area — the heart of America’s financial center." Continue reading →

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‘Paradigm shift’: Bitcoin to replace ‘broken’ government currencies?

"The Bitcoin virtual currency is up 24.5 percent in 24 hours, touching a new record of $619. The surge is 'the beginning of something spectacular,' with it potentially displacing the dollar, Jeffrey Tucker of the Foundation for Economic Education told RT. 'I think, that’s not a bubble, it represents a substantial paradigm shift,' Tucker said, commenting on the latest boom of the anonymous crypto currency. 'In fact $600 per bitcoin might be a thing of history, we might get it much –much higher,' the expert added. 'The bottom line is that the government currencies are broken at the moment, they don’t meet the modern needs of an internet age and Bitcoin does,' Jeffrey Tucker explained." Continue reading →

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Bitcoin Scandal Reflects Popularity of Virtual Currency in China

"The willingness to invest in GBL despite its shortcomings demonstrates just how popular 'crypto-currency' has become in China. In early November, BTC China overtook Mt. Gox and Bistamp to become the largest bitcoin exchange site in the world, handling 34 percent of global bitcoin transactions over the previous seven days, according to data from Bitcoinity.org, a website that tracks bitcoin exchanges. Bitcoin’s appeal to Chinese investors is manifold. The currency experienced a major spike in value in July shortly after being the subject of overwhelmingly favorable reports on CCTV, China’s state-run television station, and People’s Daily, the main Communist Party newspaper." Continue reading →

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Jim Rogers on Price Inflation, Investing in Asia and China’s Boom

"As we speak, there is this meeting in Beijing on what to do about the Chinese economy. It's a plenary council, which only meets periodically. The first meeting was in 1978 where [Deng Xiaoping] started opening up the Chinese economy, which has certainly been the most important thing in the world economy in the past 35 years. In 1993 they had another one, which had dramatic results. The Chinese say that this meeting is going to have equally dramatic and dynamic results and come up with very important changes. It may be as important as 1993 or 1978, and if they do big things, it's going to be perhaps the most important thing affecting the world economy over the next 10 or 20 years." Continue reading →

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