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01 July 2020
Video commentary for June 30th 2020
Eoin Treacy's view
A link to today's video commentary is posted in the Subscriber's Area.
Some of the topics discussed include: wide yield premiums for equities over bonds globally, gold breaks out, oil quiet, copper firm, technology shares breaking out.
Gold Climbs Above $1,800 for the First Time Since 2011
This article by Justina Vasquez for Bloomberg may be of interest to subscribers. Here is a section:
Goldman Sachs Group Inc. said gold could climb to a record $2,000 an ounce over the next 12 months, while JPMorgan Chase & Co. recommended investors stick with bullion.
“The Fed is being extremely accommodative and because these shutdowns are starting to reoccur globally, more central bank measures are probably going to be initiated,” Phil Streible, chief market strategist at Blue Line Futures in Chicago, said by phone.
Eoin Treacy's view
Gold’s front month futures traded above $1800 today while the spot price has yet to achieve that goal. The difference between the short-term patterns may give us some insight into what is animating the market in the short term.
IOTA Takes Step Towards Decentralized Network
This article by Sead Fadilpašić for cryptonews.com may be of interest to subscribers. Here is a section:
IOTA is continuing its path towards the so-called 'Coordicide' - the death (that is, the removal) of the Coordinator, which is a node run by the IOTA Foundation for network protection and transaction confirmation. The goal of this act is to make the network decentralized.
In order to "solve blockchain’s biggest issues with scalability and decentralization," as the Foundation said in their announcement, they are launching the first testnet of the decentralized network. It is a new protocol called Pollen.
Pollen's goal is to enable the community, researchers and developers to "test and validate the concepts of IOTA 2.0, which will serve as IOTA’s Coordinator-free network," the press release said. People can now test and work independently on the components such as rate-limiting, Mana (reputation-based system), and Fast Probabilistic Consensus (new consensus algorithm that doesn't need the centralized Coordinator).
"IOTA has spent the last year researching a solution that will ultimately replace its current network in the first half of 2021," they said.
Whether the Coordinator will indeed be killed in the first months of 2021 is "always hard to say," Dan Simerman, Head of Financial Relations at the IOTA Foundation, told Cryptonews.com. "Right now IOTA's actually ahead of schedule, so it’s very well possible it could be sooner. But, IOTA always like to be safe and ensure things are at their best."
Eoin Treacy's view
The holy grail for cryptocurrency acolytes is to have a fully automatic network, without relying on any one group that might theoretically exert control, while also being quick enough to compete with payment networks like Visa and Mastercard.
'Build, Build, Build' for U.K. Virus Recovery, Says Johnson
This article by Alex Morales and Tim Ross may be of interest to subscribers. Here is a section:
The 5 billion pounds Johnson allocated to hospital maintenance, school repairs and road improvements on Tuesday is not new money and is a fraction of the infrastructure spending announced in March.
What Our Economists Say:
“There was a lot of inevitable political bluster in Prime Minister Boris Johnson’s speech today, but for the economy there were two key takeaways. First, his pledge to accelerate 5 billion pounds worth of capital projects is money already allocated in the March Budget. He left plans for any further stimulus to Chancellor of the Exchequer Rishi Sunak’s update on the economy next week. Second, Johnson distanced himself from a quick return to austerity. That’s good news for the outlook.”
--Dan Hanson. For the full insight, click here
Carolyn Fairbairn, director general of the country’s biggest business lobby, the Confederation of British Industry, described the intervention as “first steps” only.
“Foundations are there to be built on,” Fairbairn said in a statement. “More is needed to prevent the uneven scarring unemployment leaves on communities.”
She called for more details on Johnson’s guarantee of apprenticeships and in-work placements for younger workers, as well as an extension of wage support to protect jobs and more funding for “future skills in high-potential areas such as digital, low carbon and health.”
Johnson described the planning reforms as the most “radical” since World War II. They include greater freedom for developers to change the use of buildings and land in town centers without planning permission, and would make it easier to convert unused commercial buildings into homes, his office said in a briefing.
Eoin Treacy's view
Focusing more on regulatory reform to boost growth, rather than relying solely on big ticket spending is an encouraging sign the Johnson administration understands where the big gains are to be made once the UK is unshackled from the EU.
The spending measures in the March budget already imply significant spending. The challenge for the UK is in overcoming the raft of bureaucratic roadblocks to growth that focus on regulations for regulations sake, rather than prioritising productivity.
China Opens Wealth Tap to Hong Kong Amid Political Crackdown
This article from Bloomberg may be of interest to subscribers. Here is a section:
The plan “has strategic importance, reinforcing Hong Kong’s position as a wealth management hub,” Sally Wong, chief executive officer of Hong Kong Investment Funds Association, said by phone. “It provides important investment channels for mainland investors to achieve diversification.”
As Beijing seeks to quash a year of unrest in Hong Kong with the introduction of a new security law, authorities have also sought to tamp down concern over the city’s status as an international finance hub. Mainland investors have boosted stock purchases through the stock connect link over the past weeks and a string of high-profile Chinese companies have listed shares in the city.
Local authorities have also sought to reassure investors that Hong Kong will remain a stable place to invest, with Chief Executive Carrie Lam lobbying for more financial integration to build the city’s presence as a global hub for private wealth and make it a more prominent offshore renminbi center. While there has been no sign of an exodus of cash, Hong Kong’s rich are increasingly hedging their bets amid the worst economic and political crises since the handover.
The U.S. overnight escalated pressure on China over its crackdown on Hong Kong by making it harder to export sensitive technology to the city as Beijing is poised on Tuesday to pass the security law. The Commerce Department said it’s suspending regulations allowing special treatment to Hong Kong over things including export license exceptions.
Eoin Treacy's view
As China attempts to draw a line under the protests that have plagued Hong Kong over much of the last couple of years, they are likely to continue to meet with resistance on the streets. The new security law is an affront to the one country, two systems agreement. It presages an acceleration of trend of absorption with the mainland than was envisaged by the framers of the handover.
Eoin's personal portfolio: stock market short stopped out a small profit June 16th
Eoin Treacy's view
One of the most commonly asked questions by subscribers is how to find details of my open traders. In an effort to make it easier I will simply repost the latest summary daily until there is a change. I'll change the title to the date of publication of new details so you will know when the information was provided.
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