Major Moves I've been talking a lot about the 10-year Treasury yield (TNX) during the past few weeks because it has been experiencing a rather dramatic decline, falling to levels not seen since December 2017. One of the reasons I reference the TNX so frequently is it is tied to a variety of assets, indexes and indicators in the financial markets, including the 30-year fixed-rate mortgage . The 30-year fixed-rate mortgage is the most popular mortgage among individual home buyers. According to Freddie Mac, approximately 90% of home buyers choose a 30-year mortgage when financing their homes. So what's the connection between the TNX and the rate on a 30-year mortgage? These two rates have a positive correlation. When the TNX moves higher, the 30-year mortgage rate tends to move higher. Conversely, when the TNX moves lower, the 30-year mortgage rate tends to move lower. In fact, these two rates move so consistently together that mortgage brokers will often approximate what the … [Read more...] about Will Falling Interest Rates Boost or Spook the Stock Market?
Stock market crash 2
Share to Twitter Share to Linkedin Bitcoin BTC and cryptocurrency prices have been hit by an almighty sell-off this month, wiping around $1 trillion from the crypto market since early April— though Elon Musk surprised some by signaling his continued support . Subscribe now to Forbes' CryptoAsset & Blockchain Advisor and successfully navigate the volatile bitcoin and crypto market The bitcoin price has dropped to lows not seen since the pandemic crypto rally began in late 2020 after a perfect storm of Federal Reserve interest rate hikes, the scaling back of its huge $9 trillion balance sheet and a huge $18 billion stablecoin meltdown ( with the collapsed cryptocurrency luna staging a shock rebound this weekend ). Now, one widely-respected analyst has warned the Federal Reserve, "endorsed" by U.S. president Joe Biden, will pursue a program of "shock therapy" in order to drive down demand and "slay" inflation—with the crypto … [Read more...] about Biden ‘Endorsed’ Fed ‘Shock Therapy’—Why The $1 Trillion Bitcoin, Ethereum And Crypto Price Crash Could Be Just Getting Started
Game stocks are nosediving this year after a gravity-defying 2021 thanks to their connections with the metaverse and non-fungible tokens (NFT), two fads that thrilled punters last year. Investors are generally jittery about potential interest rate hikes and specifically nervous about the weakness of the cryptocurrency market, which both the metaverse and NFT rely on. Metaverse games have their own crypto tokens that players can buy and use online. NFTs are often traded using cryptocurrencies. Shares of Krafton, the developer of Battlegrounds, tumbled more than 20 percent this month while NCSoft has slid more than 10 percent. They are the two biggest game developers in Korea by market cap. The impact on smaller developers has been even stronger. Shares of Wemade are down more than 20 percent this year, while its subsidiary Wemade Max, a blockchain-based game developer, are down almost 20 percent. Devsisters, known for its Cookie Run game, tumbled 17 percent and Com2uS Holdings … [Read more...] about Game stocks discover gravity in 2022
Share to Twitter Share to Linkedin In the initial phase of my career, I worked as a sell-side corporate bond trader. Trading ultimately proved not to be my true calling, but I generated consistent profits with a simple method: Buy on the bid side, sell on the offered side. Under the tutelage of experienced traders, I learned to spot market imperfections that sometimes enabled me to improve on the basic formula by buying below the bid side or selling above the offered side. There were other voices, though, lecturing me on the vital necessity of “having conviction.” Translation: You are morally obligated to decide which way the market is heading in the short run and load up your inventory accordingly, i.e., with either long or short positions. The individuals most insistent on this point were a few interdealer brokers. These intermediaries, most of whom were on a spectrum from harmless to genuinely helpful, earned one-eighth-of-a-point commissions by … [Read more...] about Conviction Is The Enemy Of Performance
The bottom fell out from one of crypto’s fastest growing blockchains, LUNA, which promised to succeed where bitcoin failed. Its predictable collapse reverberated across the entire crypto market and is forcing investors to pick up the pieces. C rypto’s history has been defined by five resets. The first came in 2014 when what was basically the only bitcoin exchange in the world, Mt. Gox, imploded following a nearly half-billion-dollar hack. The second, in 2016, was The DAO hack, when an attacker tricked a smart contract into giving away $60 million worth of ethereum, worth $8 billion today. The third, in January 2018, occurred when the ICO bubble popped, starting a year-long decline wiping out 60% of the crypto market or more than $700 million mostly in the form of worthless junk tokens. The fourth took place in March 2020 when crypto lost 40% of its value along with most other global financial markets. Each reset not only led to price-market capitalization increases, they … [Read more...] about Crypto’s Great Reset: How Digital Asset Investors Will Recover From The Market’s $1 Trillion Meltdown
Share to Twitter Share to Linkedin I’ve been drawing this and similar charts for months now: I actually think this will come to rest around $15,000 and $20,000 but the bottom could be around and even below $10,000. Bear in mind the low, however horrible it will look on the chart, will only last for perhaps minutes while the equilibrium low will be significantly higher. As I write, bitcoin BTC is at $29,300 having earlier hit $25,300 for a few minutes. Although that certainly looks like a capitulation there is almost certainly a lot more to come, because the driver for this mover is the draining of U.S. liquidity by the Fed and therefore a super rampant dollar crushing all currencies before it, including the euro and U.K. pound. Then there are the forced sellers in the Russia/Ukraine conflict to help push the crypto charabanc off the cliff. So unless something turns the corner the above chart still holds as a good road map. This has been … [Read more...] about Bitcoin, Ethereum Price Crash May 2022. What Next?
After a stellar IPO last year that saw Dutch Bros stock surge as much as 70% shortly after debuting, the popular Oregon-based coffee chain is now seeing its stock get hammered in pre-market trading. As of the time of this writing, Dutch Bros stock (ticker: BROS) is down over 39%. advertisement So, what’s causing the Dutch Bros crash? In a word: inflation. As The Oregonian reports , Dutch Bros posted some good Q1 2022 numbers when it announced quarterly results yesterday. Revenue was up 54% year-over-year and the company announced it would open 130 drive-thru’s in 2022–five more than originally intended. But Dutch Bros also announced it expected its same shop sales for the rest of 2022 will be “flat to slightly negative as we face macro-economic headwinds impacting consumer discretionary income and gas prices.” In other words, inflation is increasing costs and risks consumers’ willingness to splash out on expensive lattes. advertisement … [Read more...] about What’s happening with Dutch Bros stock? Starbucks coffee rival craters amid inflation fears
Share to Twitter Share to Linkedin One of the curious accoutrements of the Kremlin are the very large benches that sit just outside it, almost too big for comfort such that the first time I passed them I imagined giant Cossacks resting themselves as they visited the capital. What those giant Cossacks might make of today’s Russian army would be interesting to know, especially with Monday’s ‘Victory Day’ military display in and around the Kremlin. It is expected that the Russian President will use the occasion to formally declare war on Ukraine and call up a full mobilisation of troops (especially conscripts). Such as move will deepen the conflict around the invasion of Ukraine, may result in the use of heavier and more deadly armaments and further entangle Ukraine in a proxy war. Of course, another avenue open to Vladimir Putin may be to use Victory Day to engage in some much needed risk management, and to declare a ‘mission accomplished’ in the context of … [Read more...] about When Will The Ukraine War Stop?
Share to Twitter Share to Linkedin An important cryptocurrency collapsed last week and the fallout is having far-reaching effects on stocks, bonds and other risk assets. Unfortunately, this is only getting started. Terra Luna LUNA , the digital coin in the Terra ecosystem, crashed last week to near zero, a stunning fall from $67.64 a week ago. Luna was supposed to underpin UST UST , a stablecoin algorithmically pegged at one U.S. dollar. When the UST peg broke, panic ensued. Investors sold risk assets of all stripes. For many investors this contagion effect feels like déjà vu. The Russia and Asia currency crises of the 1990s roiled markets and wiped out fortunes. The news seemed to come out of nowhere then everything suddenly went off the rails as investors learned about exposure at money center banks in the United States and in Europe. A cryptocurrency inspired contagion has the potential to be much worse. Crypto has become a substantial … [Read more...] about Crypto’s LUNA Catastrophe Threatens Conventional Assets
Share to Twitter Share to Linkedin Here’s a scorecard on eight ways to own crypto. The most intriguing: a low-cost coin trust available at a nice discount. Are you interested in virtual currency, now trading at half the price it had last fall? Shop around. Among the many ways to get a piece of the action, there are wide differences in ownership costs. My favorite: a somewhat obscure bitcoin trust to be found in Fairfield, Connecticut. There are pros and cons to every means of getting cryptocurrency exposure, including the little outfit in Fairfield. This survey covers eight bitcoin bets in descending order of my views on their desirability. You may have a different ranking, especially if you are speculating on a quick turnaround. #1. Osprey Bitcoin Trust This quasi-fund (ticker: OBTC), created a little over a year ago, is a knockoff of the much better-known Grayscale Bitcoin Trust. Both trusts are closed-end, in that investors have no right … [Read more...] about How To Buy Bitcoin At 26% Off The Regular Price