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Private Money on Wall Street

Written by Ian Reynolds | Jan 13, 2024 12:28:28 AM

 

BREAKING Bitcoin drops 10%

Despite 11 spot Bitcoin ETFs being launched on Friday amid high volume, the price of the underlying asset crashed 10%.

The move reflected the technicals of the unwinding of the Grayscale fund into the Grayscale Bitcoin Trust ETF, elevated prices ( up from 15k ) and massive resistance at 48-50k. Currently, as above, the price has stabilised.

US bitcoin ETFs see $4.6 billion in volume in first day of trading [Reuters]

SEA CHANGE FOR CAPITAL MARKETS

SEC’s bitcoin ETF sign-off comes with a stark reminder of its lingering doubts [FT]

The old guard hate it like poison. Buffet hates it. Munger hated it. Dimon says he'd close it down.

Bitcoin doesn't care because there is no company, no CEO, no employees. It's decentralised.

And for it fans, it's a religion.

Now investors in the US, and elsewhere already, can invest in derivatives (ETF) of private money - traded on a US stock exchange and regulated by the SEC and insured by FDIC (some) and private insurance (mostly).

Whatever you think of Bitcoin, this is unparalleled in the history of financial markets and is the forerunner to the tokenisation of all assets and a rebuilding of the global financial system.

RED SEA

What would a US election year be, without a war. Lo and behold:

US, British militaries launch massive retaliatory strike against Iranian-backed Houthis in Yemen [9 News]

Houthis Undeterred After US Coalition Pummels Over 60 Targets With Tomahawk Missiles, Airstrikes [Zerohedge]

Oil prices hit $80 a barrel as fears grow over Red Sea disruption to trade [The Guardian]

Oil may have spiked but with US now self-sufficient and the largest producer, prices shocks will be less likely than in the 1970/80s.

Brent Front Contract Futures Monthly

FED

Fed reports record loss for 2023 amid surge in interest expenses

Following the losses of the Swiss National Bank amongst others,  the FED's preliminary accounts for 2023 suggest it lost US$114.3 billion.

Whilst insignificant compared to the US national debt of US$34 Trillion, view it live here US Debt Clock, it's another nail in the coffin of the fiat currency system.

US CPI & PPI

CPI slightly higher and PPI slightly lower than expected leaves yields relatively unchanged but the curve (2s-10s) is dis-inverting as noted by Mohamed A. El-Erian on Twitter / X.

In The Background

China is struggling to reflate it's economy despite many stimulus measures. 

In Case You Missed It

OIL

Angola’s OPEC exit highlights group tensions – but is unlikely to rattle the market [CNBC]

The World has 47 Years Worth Of Oil To Chew Through [Worldometers]

Europe

What can you say? Not surprising that consumer confidence has tanked if those consumers are expecting 10% inflation.

German manufacturing still under pressure .

Australia

Retail sales jumped on increased Black Friday sales

While inflation dropped but it's still more than 2x RBA target

November imports suggest the consumer is now becoming frugal which benefits the national trade balance

The weakness in the USD since November has cut the number of short AUD positions.

We're looking for the price to revert to the scene of the crime, break of downtrend, near USD0.66 with Friday printing a shooting star, or topping tail, formation.

AUD / USD Daily

AUD / USD Futures Speculative Net Positions (CFTC)

 

This Week's Important Economic Indicators [London time]