regime uncertainty

Investors, Run for Cover From the Incoming ‘Taper Bomb’

"The bond market sell-off is leaving fixed-income investors (at least, those who didn’t heed my advice to get out of the way) with the worst annual losses on bonds since 1999. It also proves beyond the shadow of a doubt that the bond market is more powerful than the Fed. Now, against that backdrop, the Fed is about to hold its last policy meeting of 2013. On Dec. 17 and 18, policymakers will gather around a conference table in Washington and decide whether to continue their $85 billion-per-month QE program. My prediction? They drop a taper bomb and start dialing down those purchases, probably by at least $10 billion." Continue reading →

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European Union Warns on Bitcoin

"The European Union on Friday added to a string of recent warnings about the safety of using and investing in Bitcoin, the virtual currency that is not issued by any government. The union’s banking authority said consumers needed to be aware that they were not protected through regulation when paying with Bitcoins. The digital currency is vulnerable to hackers, might lose its value and any misuse could prompt law enforcement agencies to close Bitcoin exchange platforms and keep consumers from accessing their investment, the European regulator said, adding that it was looking into whether such currencies could and should be regulated." Continue reading →

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Bitcoins Fail Currency Test in Scandinavia’s Richest Nation

"Bitcoins were dealt a blow in Norway as the government of Scandinavia’s richest nation said the virtual currency doesn’t qualify as real money. 'Bitcoins don’t fall under the usual definition of money or currency,' Hans Christian Holte, director general of taxation in Norway, said in an interview. 'We’ve done some assessments on what’s the right and sound way to handle this in the tax system.' Norway will instead treat Bitcoins as an asset and charge a capital gains tax. While tax revenue from Bitcoins isn’t substantial, Holte at the Norwegian tax authority said he plans to work with other countries to hammer out the legal aspects of Bitcoin." Continue reading →

Continue ReadingBitcoins Fail Currency Test in Scandinavia’s Richest Nation

Central Banks in New Zealand and Australia Issue Bitcoin Warning

"Representatives from the central banks of New Zealand and Australia have issued their own official warnings on bitcoin, terming the currency 'interesting, but risky'. John McDermott, assistant governor at the Reserve Bank of New Zealand (RBNZ), said banks and businesses should 'tread very carefully' with the digital currency, in a report by the Wall Street Journal. RBNZ Governor Graeme Wheeler cited price volatility as a cause for concern. Next door, the governor of the Reserve Bank of Australia, Glenn Stevens, said he was 'still trying to understand' the cryptocurrency during an interview with theAustralian Financial Review." Continue reading →

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Don’t Let the Fed Pick Your Pocket

"If you are one of those who believe that rates will rise when Ben Bernanke leaves office in January, think again. The new Federal Reserve chief, Janet Yellen, has no intention of boosting rates. She will certainly not be a friend to savers. During Yellen’s confirmation hearings on Capitol Hill, she acknowledged that seniors are hurt by low interest rates that are a matter of policy. However, the incoming Fed chief believes the greater good — the health of the U.S. economy — takes precedence over savers. This means that if you’re still relying on CDs and interest-bearing accounts to generate income, you’ll be slaughtered." Continue reading →

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Korea decides not to recognize Bitcoin as real currency

"Korean financial authorities said Tuesday that they have decided not to recognize Bitcoin, or cyber currency, as a real legal currency. The conclusion came after a week of debate among officials of the Ministry of Strategy and Finance, the Bank of Korea, the Financial Services Commission and the Financial Supervisory Service. Officials said Bitcoin, which can be traded between individuals online without going through financial institutions such as banks, does not meet standard regulations governing the transactions of currencies via the Internet or commercial institutions. A Bank of Korea official said the currency has been facing high volatility as it does not have an 'intrinsic value.'" Continue reading →

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Talk of the Day — Bitcoin to be introduced in Taiwan

"Wayi International Digital Entertainment Co. announced Wednesday that its online shopping site Wmall will begin to accept Bitcoin payments next year. The OTC (over-the-counter) market-listed company, which focuses on the research, development and distribution of online games, will be the first Taiwanese company to accept the decentralized virtual currency as a payment tool. Wayi's decision will test the Central Bank of the Republic of China's (CBC's) attitude toward Bitcoin development in Taiwan and its ability to regulate the currency's circulation. CBC Governor Perng Fai-nan said recently that the central bank has been keeping close tabs on the development of Bitcoin." Continue reading →

Continue ReadingTalk of the Day — Bitcoin to be introduced in Taiwan

Keiser Report: Bitcoin Battle

"In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss the bitcoin price plunge as Baidu ditches the crypto currency and China bans it for financial firms. Unnoticed at the same time, Germany declares bitcoin to be private money and Merrill Lynch claims it can replace money transfer systems like Western Union. In the second half, Max interviews Dr. Christos Vlachos, CFO of the University of Nicosia, which is now accepting bitcoin as payment and he explains how the volatility in the price won't matter to the university. They also discuss Dr. Vlachos' hope to turn Cyprus into a bitcoin hub." Continue reading →

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Croatian central bank establishes that Bitcoin is legal in Croatia

"Croatian national bank (CNB) gave its opinion that Bitcoin is legal, and the most notable mention was a piece on Bitcoin that got aired on 19:30 national television news on Monday. CNB took the very liberal stand that echoes European central bank document on virtual currency schemes from October 2012, noting that Bitcoin is not illegal in Croatia. They noted that it is not electronic money since it's not debt to the issuer (although it has some similarities with electronic money), and that it is not legal tender in Croatia but can be legally used." Continue reading →

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World powers react to the Bitcoin boom

"World powers have scrambled in recent weeks to react to the rise of Bitcoin, a decentralised digital currency created in 2009. China banned its banks from providing related services and products on Thursday. Meanwhile, on Thursday the French central bank warned against using Bitcoin, because of its volatility and lack of regulation. However, Bank of America Merrill Lynch said in its first research report on the currency that it had the potential to become a major means of payment for ecommerce and a serious competitor to traditional payment methods." Continue reading →

Continue ReadingWorld powers react to the Bitcoin boom