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Optimistic business expectations along with rapid vaccination aids US economic recovery in Q1 2021, says GlobalData
Following today’s release of US GDP Q1 2021 growth rate of 6.4% at an annual rate (advance estimate) in the backdrop of recovery of economic activities;
Gargi Rao, Economic Research Analyst at GlobalData, a leading data and analytics company, offers her view:
“With a total COVID-19 support package of around 37.25% of US GDP, including Biden’s $1.9 trillion America rescue plan, GlobalData expects faster economic recovery for the US in H2 2021. The consistent progress noted in key macroeconomic factors such as business and consumer confidence and the purchasing manager’s index has caused GlobalData to revise its 2021 economic growth forecast for the US from 3.96% in January to 6% in April 2021.
“The US’s Q1 GDP growth was aided by rapid vaccinations across states, an increase in social consumption, a rise in non-residential fixed investment and a surge in global demand for goods and services. A total 6% growth could be achieved if the country continues its focus on job-oriented policies, consumer spending increases, there is continued pick up in home sales and business expectations increase.
“So far, unemployment benefits, stimulus support and pensions have resulted in an increase in household savings. Plus, the continued resumption of economic activities resulted in better labour market outcomes in March 2021. Further, the business confidence index shows an upward trend from January 2021 onwards, and a balanced economic recovery is expected in H2 2021 due to growth in the services sector, a spur in household consumption growth and increase in imports.
“Amid rapid vaccination and fiscal support from state and local governments, core macroeconomic indicators have strengthened. However, the path to steady recovery depends upon the development of virus variants and progress on vaccinations. Although unemployment rate declined it is still on the higher side, which indicates jobs are restoring but at a slower pace. Moreover, a recent spike in inflation rate may still be transitory but poises immediate downside risk to economic recovery. Despite growth, uncertainty prevails.”
Are NFTs the next big investment trend or a flash in the pan?
Traditionalist investors who dismiss NFTs – the new digital asset class taking the art, fashion, music and sports world by storm – are “fooling themselves if they believe they are a passing fad.”
This is the bold – and some might say controversial – observation from Nigel Green, the CEO and founder of deVere Group, one of the world’s largest independent financial advisory and fintech organisations.
NFTs are one-off digital assets that are verified through blockchain technology, giving buyers certificates of authenticity and ownership. They produce unique, non-interchangeable digital tokens, and can be bought and sold like any other assets but they do not have a physical form.
Mr Green’s comments come as a growing number of globally established brands are becoming increasingly involved in the NFT market including the National Basketball Association (NBA) and Sotheby’s.
The latter, the traditional auction house, held a three-day auction of NFTs by an anonymous artist two weeks ago. Meanwhile, Christie’s last month sold “Everydays – The First 5000 Days,” a digital artwork in JPEG form by an artist known as Beeple, for $69.3 million – which is the third most expensive artwork ever sold by a living artist.
The deVere CEO says: “The virtual hype about NFTs is very real and traditionalist investors who dismiss them as a passing fad are fooling themselves.
“They may be a novelty at the moment, but it makes sense that with the blistering pace of the digitalisation of our world, digital assets will become increasingly valuable.
“Demographics are on the side of NFTs too. Millennials, and Gen Z especially, have digital lives and it’s natural to want to take digital representations of luxury brands, music and art into these worlds - and now they can.”
Mr Green also points to the Great Wealth Transfer. “According to some estimates, $68 trillion in wealth is to be passed down from the baby boomers – the wealthiest generation ever - to their children and other heirs over the next couple of decades,” he notes.
Another key reason why NFTs are here to stay is that they are “positively changing business models,” especially in the creative industries.
“Artists and musicians for example can provide enhanced virtual experiences for collectors and buyers, they can prove if their works are counterfeited, and they can include criteria to get royalties every time their works are re-sold in the future.”
The messaging also comes with a warning.
Mr Green says: “NFTs are the hottest new digital asset – but investors need to exercise extreme caution. This market is still the Wild West in terms of investing. Personally, I would wait until the dust settles.
“That said, those who dismiss NFTs outright would probably have been the people who previously dismissed online retailers such as Amazon and digital currencies such as Bitcoin.”
NFL Highest Average Franchise Value Among North American Sports Leagues - Over $3B In 2020
The North American sports industry is one of the most lucrative industries in the world. Since 2010 the average franchise value of the four major North American sports leagues has risen at a dramatic rate. Iconic franchises such as the Los Angeles Lakers, New York Yankees and the Dallas Cowboys, just to name a few, are now worth billions of dollars. According to data presented by Safe Betting Sites, the NFL had the highest average franchise value among the major North American sports leagues while the NBA had the highest CAGR from 2010-2020.
NFL Average Franchise Value Over $3B In 2020; NHL Only League To Experience A Decline
In 2020 the average value of NFL franchises stood at $3.045B – the highest average franchise value among the four major North American sports leagues. This figure was a 6.5%YoY increase from 2019’s value of $2.86B. The NBA had the second-largest average franchise value after leapfrogging MLB in 2019.
The average value of an NBA franchise stood at $2.123B in 2020, a 13.65% YoY increase from 2019 – the highest rate of increase among the four leagues. The NHL was the only North American sports league that experienced a decline in its average franchise value for 2020. The average value of an NHL team in 2020 stood at $653M, 2.1% less than 2019’s average value of $667M.
NBA Had Highest CAGR From 2010-2020 – 19.19%
North American sports leagues enjoyed significant growth in the last decade. In 2014 the average franchise value of the NFL, NBA and MLB had all crossed the $1B mark while the NHL crossed the $500M mark for the first time. In the period from 2010-2020, it was the NBA that experienced the highest growth among North America’s sports leagues.
In 2010 the average franchise value of the NBA stood at only $367M. Since then this value has experienced an impressive 10-Year CAGR of 19.19% – the highest CAGR among the leagues. MLB registered the second-largest CAGR of 14.2% while both the NFL and NHL had a CAGR of just over 11%.
Dallas Cowboys, NY Knicks, NY Yankees And NY Rangers Most Valuable Franchises Per League
The Dallas Cowboys of the NFL is the most valuable North American sports franchise with an estimated value of $5.5B in 2020. New York solidified its place as North America’s most lucrative sports market with the three other most valuable teams in their respective leagues calling it home. The Yankees, Knicks and Rangers were worth $5.25B, $5B, and $1.65B respectively in 2020.
You can read more about the story with more statistics and information at: https://www.safebettingsites.com/2021/03/31/nfl-highest-average-franchise-value-among-north-american-sports-leagues-over-3b-in-2020/
Royal Dutch Shell Experienced Historic Net Loss of $21.5B In 2020 - Revenue Dropped by Nearly 50%
The Royal Dutch Shell plc, more popularly known simply as Shell, is one of the largest companies in the world. However, due to the crippling effects of the COVID-19 pandemic, demand for oil fell sharply reducing its price to historic lows. As a result, Shell had one of its worst years in history, having to cut its dividend for its shareholders for the first time since World War II. According to data presented by TradingPlatforms.com, Shell posted a $21.5B net loss in 2020, with revenue dropping by over 47%.
Oil Industry and Shell Severely Impacted By COVID-19 - Net Loss of over $20B
To try and mitigate the spread of the Coronavirus, borders around the world shut and lockdowns were imposed in cities across the globe. As a result, travel in most of its forms essentially ground to a halt. This drove down the price of oil affecting industries that Shell do business in.
The Dutch-Anglo company is involved and operating in every segment of the oil and gas industry which as a whole struggled mightily to earn a profit in 2020. Shell’s revenue fell by almost $165B in 2020 a more than 47% drop compared to 2019. Shell also posted a net loss of $21.5B in 2020 after posting a net income of $16.4B in 2019.
Business was down in all but one of Shell’s business segments, with the chemicals segment the only one to post an income in 2020. Shell’s upstream segment, which deals in oil exploration and other such activities, posted a loss of almost $11B.
Shell Cut Dividends For First Time Since WWII
Shell’s performance in 2020 greatly affected its shares and in turn its investors. In 2020, Shell had an estimated 7.8B shares which is almost 400M less than the highest number of shares recorded in 2018. The oil giants also lost $2.78 per share in 2020, the only loss recorded loss in the reporting period beginning in 2008.
For the first time since World War II, shell announced that it was cutting its dividend. As a result, in 2020, Shell paid only $7.3B in dividends compared to $15.2 in 2019 - a drop of over 50%.
Cost-Cutting Measures Implemented To Mitigate Effects Of Pandemic
Shell implemented several measures to cut costs to protect its cash flow generation and balance sheet including an almost 54% drop in purchases. Shell made purchases worth $117B in 2020 compared to almost $253B in 2019. In a further effort to cut costs, Shell spent $907M on Research and Development in 2020, the lowest spend on R&D from 2010-2020.
You can read more about the story with more statistics and information here.
Boomers and retirees embracing Bitcoin and cryptocurrencies
Baby boomers and Gen X are piling into Bitcoin and other cryptocurrencies, affirms the CEO of one of the world’s largest independent financial advisory and fintech organisations.
The observation from Nigel Green, the chief executive and founder of deVere Group comes from a global poll of clients aged over 55 found that 70% of those surveyed are already invested in digital currencies or are planning to do so this year.
Last weekend, Bitcoin hit $57,000, which gave it a market capitalisation of more than $1 trillion. In addition, Ethereum, the second-largest cryptocurrency, surged past $2,000 for the first time, giving it at the time a market cap of $226 billion.
This week, the prices have dipped and the Bitcoin market is currently worth around $900 billion.
Mr Green says: “Despite this week’s drops, the Bitcoin price has still soared by almost 360% over the last 12 months, partly fuelled by endorsements made by Tesla billionaire Elon Musk, amongst others, and growing interest from institutional investors.
“This hugely impressive run has captured the attention of people around the world – and not just so-called 'digital native' younger generations, as is typically, and somewhat patronisingly, portrayed.
“Boomers and Gen X, it seems, are just as excited about digital currencies, with seven out of 10 already invested in crypto, or will do so in the near future, according to the poll.
“They too recognise that digital, borderless money is the way forward.”
He continues: “Whilst the recent massive social media hype and clickbait headlines are more of a catalyst for millennials and Gen Z to consider investing in the likes of Bitcoin, there are other drivers for older generations.
“The over-55 respondents to the survey frequently cited a key factor for their interest in crypto is the historic levels of money-printing as central banks around the world attempt to prop-up their economies following the fallout from the pandemic.
“They’re aware that if you are flooding the market with extra money, then in fact you are devaluing traditional currencies – and this, and the threat of inflation, are legitimate concerns, prompting them to seek out alternatives.
“In addition, Bitcoin’s reputation as ‘digital gold’ was also often highlighted.”
The world’s largest cryptocurrency by market cap is often referred to as ‘digital gold’ because like the precious metal it is a medium of exchange, a unit of account, non-sovereign, decentralised, scarce, and a store of value.
Mr Green adds: “Bitcoin will continue to dominate the crypto ecosystem, but even within this class, it is recommended to maintain a diversified portfolio to mitigate risks and to seize opportunities.”
Last week deVere Group added Cardano (ADA) to deVere Crypto to join other major digital currencies including Bitcoin, Ethereum, Dash, Bitcoin Cash, XRP and Dogecoin.
The move followed Cardano doubling its market capitalisation to $28 billion in around two weeks amid soaring interest, driven by the likes of rock star Gene Simmons from Kiss who has voiced his support for Cardano on Twitter after tweeting that he has purchased $300,000 of the cryptocurrency.
The deVere CEO concludes: “Baby boomers and Gen X, who own most of the world’s wealth, are embracing the cryptocurrency revolution. This will serve to further bolster prices in the market in the longer-term.”
Key developed economies to see weakening labor market trends, according to proprietary employment indicator by GlobalData
Employment trends are expected to weaken for most countries, according to findings from GlobalData’s new proprietary employment indicator, with countries such as Australia, Germany and Italy noted to see declines. The indicator notes that employment trends will be more stable in Japan and Russia with pick-up in Sweden.
Adarsh Jain, Director of Financial Markets at GlobalData, comments: “The weakening employment trend is driven by weakening corporate demand for labor as overhang from pandemic related end-demand suppression continues to work through the system.
“In fact, GlobalData’s prediction of weakening labor market trends in the US and Canada was borne out last week, with official US employment numbers declining by 140,000 – the first decline in eight months and against consensus expectation of more than 50,000 jobs gains. Similarly, Canada experienced a 63,000 decline in jobs – the first decline since April 2020.”
GlobalData’s jobs dataset provides a great proxy for the ‘hiring intentions’ of companies. When aggregated, this provides for economy-wide hiring intentions.
Jain notes: “Intentions translate into ‘action’ down the line, so GlobalData jobs data is well positioned to capture emergent trends early. In addition, for countries where we have Reuters Poll consensus numbers for the employment numbers we track - US, Canada, and Australia - our indicator provides better lead times. GlobalData data is available near real time, at daily frequency, so we are able to get real-time read on state of labor markets compared to official data which often release with a lag of few weeks”.
Early-stage funding rounds dominate VC investment landscape in APAC during Q3 2020, reveals GlobalData
Despite volatile market conditions, venture capital (VC) investors seem to continue placing bets on promising start-ups as the COVID-19 pandemic has dramatically accelerated the rate of digital adoption by companies across sectors. Against this backdrop, early-stage funding rounds (Seed and Series A) dominated the venture capital (VC) funding landscape during the third quarter (Q3) of 2020 in the Asia-Pacific (APAC) region, according to GlobalData, a leading data and analytics company.
The number of deals with disclosed funding rounds decreased by 9% from 387 in July to 352 in August before bouncing back by 30.4% to 459 deals in September. In total, 278 Seed and 527 Series A funding rounds were announced during Q3 2020, which collectively accounted for 67.2% of the total deal volume.
In contrast, growth/expansion/late stage funding rounds (Series B, Series C, Series D, Series E and Series F) were much less in number compared to the early-stage funding rounds and collectively accounted for just a little more than 30% of the total deal volume.
Aurojyoti Bose, Lead Analyst at GlobalData, says: “While the dominance of early-stage funding rounds may look like a no-concern scenario for start-ups, VC investors seem to remain extra cautious while placing big bets during the COVID-19 times. Only five Series A funding rounds had deal size more than or equal to US$100m and only two Seed funding rounds had deal size more than or equal to US$10m.”
Despite All-Time High: 87.2% of Investors Expect Price of Gold to Rise Further in the Second Half of the Year
87.2% of investors in precious metals are expecting the price of gold to climb even higher in the second half of the year. As illustrated in a new infographic from Kryptoszene.de, both small investors and market experts see great potential in gold.
In the first 6 months of the year, the price of gold recorded its second highest half-yearly gain of the last decade. Confidence in the future of gold has never been greater, with 34.7% of investors convinced that the price of the precious metal is benefiting from the monetary policies of governments and central banks. Another 20.7% are suspicious of the level of government deficits and therefore expect gold to perform positively.
Meanwhile, our infographic shows that Google's global demand is also hitting new highs. The Google trend score for the search term pair "Buy Gold" currently stands at 94, and last week it hit the maximum value of 100. This stands for the largest possible relative search volume. Germans expect gold to outperform all other asset classes in terms of price development over the next 3 years. In second place are equities - with every fourth investor convinced that this asset class will develop best in the coming years.
“Various market players seem to share the sense that gold still has a long way to go", observes Kryptoszene analyst Raphael Lulay. "Driving the price rise are loose monetary policy, deficits in national budgets, fears of a second wave of infection and geopolitical uncertainties".
The full story with the infographic, facts and more statistics:
72% of Traders Lacked Experience Before Trading Forex with 15% Profitable
Data gathered by Forex School Online reveals that in 2020 72% of forex traders had no prior experience before trading. According to the data, 15% of the traders had profitable outcomes.
Profitable traders have more experience
Most of the traders had an average age of between 35-44 at 28% followed by individuals in the range of 18-34 years old at 27%. The third highest average age group was above 55 years old at 24% followed by the age group of 45-54 years old at 21%.
In terms of experience, the surveyed traders involved in trading forex between one and three years stood at 39%. The second-highest lot had traded forex for less than a year at 31% while 23% of the traders had been trading forex between four to nine years. On the other hand, only 7% of the traders were actively involved in forex for at least a decade.
Consequently, the forex trading experience had an impact on whether a trader is profitable or not. Most profitable traders had an average experience of 5.4 years compared to 2.5 years for unprofitable traders. On self-improvement, a whopping 65% of the profitable traders wanted to work on their mindset and have a good trading plan in place. On the other hand, about 49% of unprofitable traders have their focus on better entries. In terms of time spent on trading, both classes of traders spent an equal time of three hours daily.
The data also overviewed the traders' aspirations where 64% are focused on getting a higher win rate as opposed to high rewards. Notably, the traders also wish to increase their chances of a high win rate or reward therefore 43% of traders plan on improving their trade rules and plan. On the other hand, 30% are looking to find better trade entries.
Notably, more than half of the traders at 53% have invested in materials to help them in their trading. Such materials entail courses, books, or strategy testers. The remaining 47% have not purchased any material to boost their forex trading. Additionally, during trading, 50% of responders spend their time online reading lessons and watching videos, whilst 8% are part of a group or tribe. 7% of the traders spend their time on social media and forums during a trading week.
Besides 97% of the traders focusing on forex, about 43% trade-in Gold, 24% stock indices, and 9% cryptocurrencies.
The full story, statistics and information is available here
eToro Chief Blockchain Scientist: Primary Issue for Banks offering Crypto Related Services has been Compliance & KYC
Chief Blockchain Scientist at eToro Group and Managing Director at eToro Labs Omri Ross has stated traditional banks joining the crypto sector have compliance and KYC as their primary concerns. In a recent exclusive interview with Buy Shares, Dr. Ross acknowledged that over the recent years, such concerns are gradually diminishing.
Blockchain’s unexplored potential
With the blockchain being around for over a decade, Ross talked about the unexplored areas around the technology. According to Ross:
“I believe that the qualities associated with automation and transparent computation will emerge as an attractive solution for redesigning existing business models in the future. This is simply because of the cost-effectiveness and accessibility associated with utilizing permissionless blockchain technology as the base layer of the stack in any financial application."
On the centralization controversy surrounding Facebook’s Libra, the blockchain scholar points out that the project will have a successful launch in the end. He acknowledged Facebook’s efforts to continually develop the project in a bid to win the trust of users and authorities.
As a scholar, Ross noted that it will take sometime before there is a consolidated universal syllabus on cryptocurrencies. He acknowledged that currently, there are different complex aspects emerging in the industry that will be put in a syllabus.
With eToro’s Lira project, the blockchain scientists pointed out that it will benefit financial institutions in several ways like cost-savings through the execution of derivative contracts on-chain.
The full interview can be found here
ECB’s extended no-dividend recommendation: a quid pro quo that could have adverse consequences
The ECB’s recommendation to banks not to pay dividends until 2021 is credit positive in the short term. Retaining earnings will help absorb future credit losses and reduce the risk of regulatory intervention higher up the capital structure.
However, if shareholders have no prospect of achieving adequate returns on their investments, a policy of blanket bans extended for too long risks increasing banks’ cost of capital over time, especially well-capitalised banks.
The European Central Bank already urged banks under its supervision in March not to pay dividends or buy back shares for the 2019 and 2020 financial years until at least 1 October 2020. Today’s recommendation pushes this to 1 January 2021, although scrip dividends are allowed. This cautious approach will likely be followed by other European regulators including the UK’s PRA. Banks have been disciplined so far and there have been just a few exceptions, agreed on a case-by-case basis. The absence of similar treatment for AT1 coupons is reassuring for investors in these hybrid instruments.
As lockdowns have now been lifted across Europe and economies are gradually catching up, there are clear signs of recovery across the board. Still, we believe the slow return of economic activity to pre-crisis levels, the inevitable rise of unemployment in the short term and another possible wave of lockdowns, even partial ones, warrants a precautionary approach to dividend distribution. The ECB’s renewed recommendation balances the downside risks on the macroeconomic outlook and remaining uncertainties about the direction of bank asset-quality indicators and revenue streams for the remainder of the year.
Given the unprecedented EU and government support packages, banks are also expected to take their share of actions to keep the economy afloat. Not only by expanding credit facilities (many of them State-guaranteed) but also by adopting low profiles on cash distribution, from remuneration policies to dividend payments. In this context, we view the ECB recommendation not to pay dividends as a quid pro quo for European banks.
The exceptional regulatory forbearance granted recently was intended to help banks navigate turbulent times. It allows banks to operate temporarily below regulatory minimum levels; for instance in terms of Liquidity Coverage Ratio (LCR), or below the (often not disclosed) Pillar 2 Guidance (P2G) add-on for capital adequacy. Some flexibility was also brought forward to this year allowing banks to meet Pillar 2 requirements with non-core capital, including Additional Tier 1 and Tier 2 instruments. Finally, we see the ability of banks to grant payment holidays to customers without triggering a problem loan classification and putting aside impairment charges as another major accommodating measure to protect banks’ P&Ls.
But we believe this one-size-fits-all approach to dividend payments could come into question in the long run if it appears to be too rigid and/or has adverse unintended effects. First, banks across the EU face different post-lockdown operating conditions; some recovering more rapidly than others. A more efficient capital-optimisation strategy for banks with large buffers and better-performing domestic economies would make sense, in our view. We believe some Nordic banks are heading in that direction. UBS also recently indicated that it was well positioned to pay the second tranche of its 2019 dividend later this year and would consider a share buyback.
Dividends represent an important source of revenues for shareholders, supporting their own creditworthiness. Dividend payments may be an important source of revenue for local communities, especially for entrenched mutually-owned retail groups. The ring-fencing of intra-group revenues may become an issue for conglomerates. The ability of international groups to upstream dividends from their foreign subsidiaries, even within the euro area, has proved to be a sensitive topic in the past. It is a critical source of income for parent companies that are non-operating holdings exposed to material double leverage.
In the case of a prolonged economic downturn, it remains to be seen if the extension of the ECB’s recommendation not to pay dividends could turn a ‘temporary and exceptional’ measure, as highlighted in today’s communication, into a permanent de facto macro-prudential tool. We note that the US Federal Reserve recently linked equity dividends to quarterly earnings in its latest Comprehensive Capital Analysis and Review (CCAR) exercise.
For European banks, such a prolonged approach would likely hamper their access to capital markets at a time when already low long-term profitability prospects have damaged the banking sector’s attractivity for equity investors. We are therefore not surprised that banks are reluctant to reduce their MDA buffers to increase lending when faced with a very high cost of capital and much uncertain prospects on the macro front. The ECB reported an annualised return on equity at an aggregate level of just 1.21% at the end of the first quarter of 2020 for the significant financial institutions it covers.
FiCAS Pioneers the World’s First Actively Managed Cryptocurrency Exchange Traded Product (ETP)
Zug/Switzerland, 28 July 2020 - FiCAS AG, a Swiss-based crypto investment management boutique, has successfully registered the Bitcoin Capital Active ETP (BTCA; ISIN CH0548689600) — the world’s first actively managed crypto exchange-traded product, listed at SIX. The discretionary ETP, issued by Bitcoin Capital AG, will be managed by FiCAS AG, which trades the top 15 cryptocurrencies and aims to deliver enhanced returns for clients. The Bitcoin Capital Active ETP is issued at CHF 100.
FiCAS has received full regulatory approvals in Switzerland for the listing of the Bitcoin Capital Active ETP, which provides the green light for retail and institutional investors to tap the burgeoning asset class in a simple and secure way.
Ali Mizani Oskui, founder of FiCAS, said, “Devising the world’s first actively managed Crypto ETP marks an important milestone in our effort to deliver enhanced market returns for our clients over time. Based on our in-depth trading and analytical experience, actively managing our underlyings allows us to preempt and react to market movements through the discretionary buying and selling of crypto assets to steer risk-adjusted returns. Personally, I have built my expertise in crypto trading since 2013, with a strong track record in outperforming the market. I look forward to bringing my trading experience to global and institutional markets with this pioneering product.”
Easy to trade through any bank or broker
Investors can purchase the Bitcoin Capital Active ETP similarly to buying shares on the secondary market, through any broker or financial adviser at a bank with access to the Swiss Stock Exchange.
Technical and analytical investment strategy
The main investment objective of FiCAS is to increase the net asset value of the Bitcoin Capital Active ETP through actively trading bitcoin against carefully selected altcoins and exiting to fiat whenever necessary based on crypto market performance. The investment strategy behind FICAS uses technical and fundamental analysis, proprietary algorithms and quant signals, and the trading experience of the team with the aim to generate exceptional returns.
Proven track-record of underlying trading strategy
The personal trading performance of Ali Mizani Oskui, founder of FiCAS, between 2015 and 2018 - also famous for his correct predictions of bitcoin price development - has been audited by a ‘Big Four’ consultancy firm. The audit detailed Mizani’s 110% outperformance against Bitcoin holding strategy returns from October 2015 to January 2018, when Bitcoin price reached its all-time high of nearly $20,000. As soon as the Bitcoin price reached its all time high, Mizani changed the allocation into a cash position and the performance of the fund reached returns of more than 90x in USD. This fund was subsequently shut down to open under a new legal and institutional-grade format in Switzerland’s Crypto Valley in late 2019. This investment strategy was then reaffirmed in a live test portfolio in the form of a private placement, managed by FiCAS, which outperformed bitcoin price between January 2020 and June 2020 by over 10%.
Dr. Mattia Rattaggi, Chairman of the FiCAS Board, said, “Amid the current market environment of historically low interest rates and global equity market volatility, we are seeing a real desire among investors to diversify into alternative asset classes. With this in mind, FiCAS’ pioneering ETP launch today, an industry-first achievement, is the ideal opportunity to pursue superior returns while expanding asset diversification. A discretionary managed ETP is a much more appropriate new instrument in the context of the still novice cryptocurrency market and further bridges the worlds of traditional and crypto finance.”
About the Bitcoin Capital Active ETP
The Bitcoin Capital Active ETP is the world’s first actively-managed exchange traded product (ETP) featuring cryptocurrencies as underlying assets, listed at SIX. The discretionary ETP, issued by Bitcoin Capital AG and managed by FiCAS AG, trades the top 15 cryptocurrencies with the aim to deliver enhanced returns for clients via active trading and risk management. The ETP is available to both retail and institutional investors in Switzerland and in select jurisdictions across Europe to purchase through any broker or financial adviser at a bank with access to the Swiss exchanges.
For further information on the Bitcoin Capital Active ETP, visit www.bitcoincapital.com
About FiCAS AG
FiCAS is a Swiss-based crypto investment management boutique. The firm devised the Bitcoin Capital Active ETP — the world’s first actively-managed exchange traded product (ETP) featuring cryptocurrencies as underlying assets. FiCAS’ discretionary investment strategy is based on fundamental and technical analysis, proprietary algorithms and quant signals, and experienced analysts. FiCAS’ founder, Ali Mizani Oskui, has a proven track record of outperforming crypto market trends. The portfolio he managed from October 2015 to January 2018 achieved 110% outperformance against Bitcoin holding strategy returns during the same period, audited by a ‘Big Four’ consultancy firm. Founded in 2019, FiCAS is led by experienced portfolio managers and quant strategists, with expertise in both cryptofinance and traditional finance.
For further information on FiCAS, visit www.ficas.com, or follow us on Twitter at @Ficas_ltd and LinkedIn at @FiCAS_LTD
US control nearly 50% of global investment fund assets
Data gathered by Buyshares.co.uk indicates that the United States controls almost half of the global investment fund asset. According to the data, the US accounts for 47.9% of fund assets as of the first quarter of 2020.
European countries have more investment fund assets
Luxembourg has the second-highest figure at 8.8% followed by Ireland’s 5.8%. From our data, Germany is the second European country on the list with third overall investment asset funds at 4.6%.
China is fifth on the list of 4.1% of the global share. France's assets place it in sixth place at 3.8% followed by Japan’s 3.7%. Other regions of the world account for 21.4% of the fund assets. Overall, Europe dominates with five countries being ranked among the top ten largest fund domiciles in the world
The Buyshares.co.uk data also reviewed the worldwide assets of regulated open-end funds between the first quarter of 2019 and 2020. Funds covered under this category include exchange-traded funds (ETFs) and institutional funds.
During the first quarter of this year, the figure stood at $53.01 trillion, a drop of 10.77% from $59.41 trillion recorded in the last quarter of 2019.
This drop can be attributed to the ongoing health crisis. According to Buyshares.co.uk research report:
“Elsewhere, the slight drop recorded under the worldwide assets of regulated open-end funds in the first three months of this year correlates with a period of a sharp slowdown in economic activity across the globe due to the coronavirus pandemic. The slight plunge can be viewed as maturity in investor behavior with market corrections being perceived as an opportunity rather than a threat.”
During the first quarter of last year, the funds stood at $54.09 trillion, which later rose to $54.98 trillion in the second quarter representing a percentage increase of 1.64%. In the third quarter, the figure rose to $57.63 trillion. Between the first quarter of last year and this year, the funds have declined by 1.99%.
The full story, statistics and information can be found here: https://buyshares.co.uk/us-control-nearly-50-of-global-investment-fund-assets/
FTSE 100 is the only index to have negative returns in 20 years among 5 largest indices
Data gathered by Buyshares.co.nz shows over the last two decades, the FTSE 100 was the only index to register negative Return of Investment at -1.29% among major indices. The ROI was recorded between July 1st, 2000, and July 1st, 2020.
NASDAQ’s index records highest YTD returns
Our research overviewed the ROI of Dow Jones, S$P 500, NASDAQ, FTSE 100, and Nikkei indices. United States-based NASDAQ index registered the highest return of investment at 156.03%.
Dow Jones had the second-highest ROI at 147.61% followed by the S&P 500 index at 116.02%. Japan’s Nikkei index had the fourth highest returns at 35.55%.
Our research also overviewed the Return of Investment of the five indices based on Year-To-Date points. From the data, NASDAQ is the only index with positive returns at 13.17%.
The S&P 500 had returns of -3.55% to emerging as the least impacted index while Japan’s Nikkei index had a YTD returns of -6.48%. The Dow Jones at -9.82%. On the other hand, FTSE 100 has recorded the worst returns at -18.35%.
The negative YTD returns are tied to the impact of coronavirus pandemic. However, some indices might recover. According to the Buyshares.co.nz research report:
“Despite having negative returns in the last two decades, the FTSE 100 index is staring at a bright future considering that the United Kingdom's economy is planning to reopen as government measures to contain the pandemic begins to pay off. In the recent past, FTSE 100 risk sentiment was boosted by news of a possible coronavirus vaccine from Pfizer and Germany’s Biotech, which was found to be well tolerated in early-stage human trials.”
For US-based indices, the recovery period might be longer considering that the country is staring at a possible second Covid-19 wave.
The full story, statistics and information can be found here: https://buyshares.co.nz/2020/07/02/ftse-100-is-the-only-index-to-have-negative-returns-in-20-years-among-5-largest-indices/
Bitcoin’s last 5 years ROI is 70x higher than average return of five major indices
Data gathered by Buyshares.co.uk shows that over the last five years Bitcoin’s Return of Investment was 70.16 times higher compared to the average of five major indices. According to the data, the average ROI for the researched fives indices was 49.27%.
Major indices plunge in the wake of coronavirus pandemic
According to the data, between June 26, 2015, and June 26, 2020, Bitcoin ROI was 3,456.98%. The overviewed indices include NASDAQ, S&P 500, Dow Jones, NIKKEI, and FTSE 100.
The NASDAQ index had the highest Return of Investment at 96.77% followed by The S&P 500 at 46.23%. In the third slot, there is the Dow Jones index with an ROI of 42.16%. Japan’s NIKKEI had the fourth-highest ROI at 11.94%. Finally, the FTSE 100 is the only index with negative returns at -6.96%.
Buyshares.co.uk's research also compared the Return of Investment between Bitcoin and the major indices based on Year-to-Date statistics. Bitcoin had the highest ROI at 28.71%. NASDAQ had the second ROI of 8.74%, to emerge as the only index with a positive return between January 1st and June 26 this year.
NIKKEI’s returns stood at -4.83% followed by S&P 500 with a Return of Investment at -6%. On the other hand, Dow Jones had the fourth highest returns at -12.34%. Lastly, FTSE 100 (FTSE) had the worst ROI at -18.33%.
Various factors have contributed to the recent crash of the leading indices offering Bitcoin a golden opportunity to thrive. According to Buyshares.co.ke research report:
“With coronavirus pandemic that led to the traditional market crash, many view Bitcoin as an alternative store of wealth. Bitcoin fans consider the pandemic as the catalyst for elevating the cryptocurrency to the digital gold.”
The current crash will offer investors a chance to put money in stocks with the hope to reap later.
The full story, statistics and information can be found here: https://buyshares.co.uk/bitcoins-last-5-years-roi-is-70x-higher-than-average-return-of-five-major-indices/
10 largest stock exchanges control $63 trillion in capitalization, US accounts for 54% of global stocks
Data gathered by Buyshares.co.nz indicates that the top stock exchanges currently control a market capitalization of $63.89 trillion. According to the data, the United States takes a big chunk of the global stock market distribution.
NYSE dominates other exchanges
From the research data, the New York Stock Exchange occupies the top spot with a capitalization of over $25.53 trillion. NASDAQ also from the United States holds the second spot with a capitalization of $11.23 trillion. The Japan Exchange Group is third with a capitalization of $5.1 trillion followed by China’s Shanghai Stock Exchange at $4.67 trillion. Hong Kong Exchanges is fifth with a capitalization of $4.23 trillion.
Euronext Europe is sixth on the list with an equity capitalization of $3.67 trillion followed by China’s Shenzhen Stock Exchange at $3.28 trillion. Elsewhere, Italy and UK based London Stock Exchange is seventh with a capitalization of $2.92 trillion. TXM group from Canada and India’s BSE Limited occupy the ninth and tenth spot with a capitalization of $1.75 trillion and $1.51 trillion respectively.
The Buyshares.co.nz report highlights that the stock market plays a vital role in the economic growth of a country. When the market is depressed like during the coronavirus pandemic, the economic growth of a country becomes uncertain. According to the report:
"During the pandemic, many stocks plunged to all-time lows, sparking an investment interest from the public. The investors took advantage of the low prices with the hope of profiting once the stock market recovers."
The research also overviewed the distribution of countries with the largest stock market globally as of January 2020 where the United States accounted for 54.5%. Japan follows a distant second with 7.7%, followed by the United Kingdom at 5.1%. China is the fourth with 4% of the global stock market while France caps the top five categories at 3.2%.
Switzerland is sixth at 2.7% followed by Canada, Germany, and Australia accounting for 2.7%, 2.6%, and 2.2% respectively. Smaller yearbook stocks account for 6.3% of the global stock market. On the other hand, the stock market not in the yearbook accounts for 8.9%.
The full story, statistics and information can be found here: https://buyshares.co.nz/2020/06/18/10-largest-stock-exchanges-control-63-trillion-in-capitalization-us-accounts-for-54-of-global-stocks/
deVere launches pioneering identity verification app amid soaring fintech demand
One of the world’s largest independent financial advisory and tech wealth organisations is to launch a first-of–its-kind onboarding verification app amid “soaring global demand” for fintech solutions.
deVere Group’s pioneering Ident Me app provides a secure identity verification system - as an alternative to traditional customer onboarding - and a notary services function when required, which is a first for the international financial services and fintech sector.
Of the launch of this new service, the founder and CEO of deVere Group, Nigel Green, comments: “We’re in an exciting new world. In recent months, the future has happened faster. There have been major shifts in the way we live, work, and manage our finances.
“Much of this is being driven by digital technologies, and our financial lives are no exception.
“There’s soaring global demand for fintech [financial technology] and it’s clear it is going to become an increasingly dominant part of our lives moving forward.
“Indeed, fintech is already the ‘new normal’ as we increasingly insist on immediate, on-the-go, 24/7 access to, use and management of our money. We demand personalised, on-demand services and lower costs.”
He continues: “Against this backdrop of growing demand, we decided that we needed to make the set-up process of onboarding to use our fintech apps as quick, easy and secure as possible.
“Ident Me is a hassle-free, simple and safe way for clients to provide identity verification for themselves via a KYC (Know Your Client) form.”
KYC is a financial services standard.
The Ident Me app consists of an easy three-step process.
First, proof of identity. This is done by taking pictures of the front and back of your ID card or passport.
Second, the capture of documents. This is undertaken by taking a picture of a document with your address on it, for example, a utility bill or rental agreement.
Third, the liveness test. A live selfie you take will get verified against your ID/Passport photo.
Once this has been approved, clients will soon be able to have access to and enjoy the benefits of deVere’s suite of fintech apps.
deVere is one of the very few financial advisory organisations that has been actively and consistently pushing into fintech and is now widely regarded as one of the leaders in the sector.
Currently, the organisation’s apps include deVere Vault, a global e-money currency app and multi-currency prepaid card; deVere Crypto, a cryptocurrency app to store, transfer and exchange major cryptocurrencies, including Bitcoin; deVere Core, an app that allows clients to monitor their investments in real-time, on-the-go, keeping them informed with news and events that impact investor returns; and deVere Catalyst, a low-cost investment and savings app that offers best-in-class globally diversified funds.
The deVere CEO concludes: “We believe that everyone should have access to and reap the benefits of cutting-edge fintech.
“Ident Me, the first-of–its-kind onboarding verification app, helps further democratise financial technology.
“Fintech is meeting growing demand for on-the-go service, it is speeding up the advance of global financial inclusion which helps social advancement around the world, plus costs are lowered and the client experience is enhanced.”
Investors buoyed by extra U.S. stimulus to support recovery
Investors who have been “paying attention” have been topping–up their investment portfolios and will continue to do so, says the CEO of one of the world’s largest independent financial advisory and fintech organisations.
The comments from Nigel Green, the chief executive and founder of deVere Group, which has $12bn under advisement, come as stock markets around the world further rallied on Tuesday after the U.S. Federal Reserve announced an expansion to its historic stimulus programme.
Mr Green affirms: “Global stocks have been buoyed by the news from the Fed - the world’s de facto central bank – to buy individual corporate bonds in addition to the exchange-traded funds it is already purchasing, to support the world’s largest economy.
“This extra stimulus acts as a ‘backstop’ or ‘floor’ for equities.
“The additional Fed support was widely expected by the markets and therefore, investors who have been paying attention have been topping-up their investment portfolios recently as entry points will inevitably continue to go higher as we move forward.”
He continues: “It is likely that savvy investors will continue to enhance portfolios as the backing is likely to be maintained for years, not quarters.
“Also, it has been reported that President Donald Trump’s administration is preparing to unveil a $1 trillion infrastructure package. This will further boost asset prices.”
The deVere boss called the additional measures last week.
He noted on Thursday June 11: “Further stimulus can be expected from the Fed - and also perhaps from Congress too - in the near future… This will support and likely boost asset prices moving forward. Investors will now be eyeing the opportunities before any fresh or enhanced stimulus packages are announced.”
London’s FTSE 100 and Frankfurt’s Dax both jumped 2.2% in morning trading on Tuesday, the pan-European Euro Stoxx 600 gained 2%. U.S. futures markets suggested that U.S. stocks would rise further when trading begins on Wall Street, with S&P 500 futures up 1%.
In Asia-Pacific, Tokyo’s Topix shot up 4% and Australia’s S&P/ASX 200 gained 3.9%. Meanwhile, Hong Kong’s Hang Seng rose 2.4% while China’s CSI 300 index was 1.5% higher.
Nigel Green concludes: “Few things can fuel markets like another stimulus injection.
“The message investors are taking away is that the U.S. central bank and government are prepared to do whatever it takes to support the recovery.”
The Fed’s commitment: Investors will move to top-up portfolios
Investors will move to further top-up their investment portfolios following the U.S. Federal Reserve’s first meeting since last year and since the Covid-19 crisis gripped the global economy, affirms the CEO of one of the world’s largest financial advisory and fintech organizations.
The comments from deVere Group’s Nigel Green follow the Fed’s meeting on Wednesday at which they said they would hold rates the same at near-zero for some time to help boost an economic revival.
Mr Green notes: “It was expected that rates would stay the same and the U.S. central bank’s decision was unanimous on this.
“The focus was on Chairman Jerome Powell’s statement that followed after.
“In a press conference he said that the pandemic “weighs heavily” on the American economy – the largest in the world – and that the Fed would do “whatever we can, and for as long as it takes” to support the recovery and “limit lasting damage” to the economy.
“Against this backdrop, further stimulus can be expected from the Fed - and also perhaps from Congress too - in the near future as the economic revival will be a longer process than many had hoped.”
He continues: “This ‘backstop’ from the Fed slashes the threat of a second market slump even if economic data comes in worse than next quarter.
“It provides something of a ‘floor’ for equities.
“As a result of this, investors will be seeking to further top-up their investment portfolios to get ahead at lower entry points, before the hike in values that would kick-in with another round of stimulus.”
Mr Green’s message, however, comes with a warning too. “To many, the stock markets have seemed out of step with the bleak economic data recently.
“But it could also be the case that they are giving us clear signals for the current and future shape of the economy, in which there are and will be distinct winners and losers, unlike in other recessions.
“A good fund manager will help investors seek out the opportunities and mitigate potential risks as and when they are presented to generate and build their wealth.”
The deVere CEO concludes: “The Fed believes the economic outlook for the rest of this year will be tough. But it will continue to purchase government-backed debt “at least at the current pace” and the markets believe this will be further increased in order to maintain smooth market function.
“This will support and likely boost asset prices moving forward. Investors will now be eyeing the opportunities before any fresh or enhanced stimulus packages are announced.”
Investors could be hit by uneven stock markets
Investors could be hit by uneven global stock markets, warns the CEO of one of the world’s largest independent financial advisory organisations.
The warning from Nigel Green, chief executive and founder of deVere comes as stock markets around the world extend their remarkable rallies despite a continuing global public health emergency, economic downturns and financial upheaval, political uncertainty and widespread social unrest.
Wall Street is expected to open higher again on Tuesday – with the benchmark S&P500 less than 10 per cent from its all-time high.
In the Asia-Pacific region and across Europe, all major indices made gains.
Mr Green notes: “Global markets are continuing to rally. This is extraordinary as tensions between the U.S. and China – the world’s two largest economies – are heightened, when the President of the U.S. is threatening to deploy the U.S. army onto the streets of America, and as the global economy attempts to recover due to an ongoing pandemic for which there is still no cure, to name a few of the current factors causing chaos.
“All of this would normally send the markets into tailspin. Yet this time they continue to rally.
“But a closer look at the markets shows the upswing is being fuelled by a handful of companies that reflect the ‘new world’, which is increasingly tech-driven.”
He continues: “This is concerning as some investors could potentially take a significant hit.
“Investors who buy an exchange-traded fund, or ETF, which are investment funds traded on stock exchanges, could be particularly at risk from uneven markets.
“In these highly unusual times, ETFs are the wrong place to invest right now.”
Actively managed funds, says Mr Green, can be “expected to outperform in 2020 and beyond.”
He says: “The world has been ‘reset’ and as it readjusts, we will see new industries, new trends and new highly successful companies emerge – and probably quicker than many might expect.
“To fully capitalise on the major opportunities of this new era, and to mitigate the risks of considerable market imbalance, investors should ‘think active’ to be in the right stock.”
The deVere CEO concludes: “In the current climate, actively managed funds are likely to best position investors to navigate the new world.”
Stimulus packages to steadily boost the price of Bitcoin
The price of Bitcoin and other cryptocurrencies is set to rise due to the limitations of record-shattering stimulus packages, affirms the CEO of one of the world’s largest financial advisory and fintech organisations.
The comments from Nigel Green, chief executive and founder of deVere Group, come as the European Commission on Wednesday proposed a €750 billion ($826 billion) stimulus package to help the EU towards economic recovery.
In addition, in the U.S., the House passed a record-breaking $3 trillion relief package. Other countries’ central banks, including those in China, Japan and Australia, have taken similar measures.
Mr Green says: “The steps being taken by governments and central banks around the world to boost their respective economies can be expected to trigger a steady increase in the price of Bitcoin.
“As the largest cryptocurrency by market capitalisation, this will have the effect of bringing up the wider crypto sector too.
“By printing huge sums of helicopter money to push into financial systems, traditional currency becomes devalued.
“Bitcoin, of course, cannot simply be printed. Indeed, it is living up to its reputation as ‘digital gold.’ Like the safe-haven precious metal, it’s widely accepted as being a store of value and is valued for its scarcity.”
He continues: “There’s also the legitimate concern over inflation.
“Governments are promising literally boundless stimulus. This money has to go somewhere, so will prices rise? Many experts are expressing fears about a longer-term inflationary boom.
“To hedge against inflation risks, it is likely that more and more investors will increase their exposure to Bitcoin and other digital currencies, driving up prices.”
A high-profile cryptocurrency advocate, Nigel Green has recently noted that looking beyond the current macro climate, we will see an upward, long-term trajectory in the price of Bitcoin due to real-world issues it addresses and increasing adoption.
The deVere CEO concludes: “By the printing of never-seen-before amounts of money, traditional currencies are devalued, inflation fears rise, and crypto prices will steadily increase.”
Stock markets are unbalanced, investors warned
Wall Street is unbalanced, and investors are in danger of becoming complacent, warns the CEO of one of the world’s largest independent financial advisory and fintech organisations.
The warning from deVere Group’s Nigel Green comes as U.S. stock futures indicate another strong open for Wall Street on Tuesday following a long holiday weekend.
Mr Green says: “Wall Street and other stock indices around the world have been, in general terms, rallying in recent weeks as investors jump on fresh Covid-19 vaccine optimism and signals that global economies are beginning to be revived.
“There’s an over-riding and far-reaching bullish sentiment in stock markets. However, there are bonafide concerns that investors are in danger of becoming complacent.
“This is because the headline figures of rallying markets are not the best barometers of the economy right now. The upswing on Wall Street, for example, is being driven by a handful of companies all within the same sector: tech.”
He continues: “This global economic downturn is different to others as there are clear winners and losers, whereas in previous ones it has been far less clear-cut and more a question of how much all firms were impacted.
“This one has produced enormous financial benefits for some, like tech, and left many struggling and others failing completely.”
The deVere CEO says that while the booming sectors such as tech, home entertainment and online retailers might “indicate what the future, post-pandemic economy looks like”, it doesn’t reflect underlying economic conditions – and this “could catch investors out.”
He notes: “Buying an exchange-traded fund, or ETF, which are investment funds traded on stock exchanges, could expose a client to a potentially unbalanced market.”
To navigate the markets when they aren’t reflecting the slew of current poor economic data, investors are urged to work with an experienced fund manager to help them “seek the significant opportunities but to mitigate potential risks.”
Mr Green concludes: “The firms which are ‘winners’ in this downturn are over-represented on many leading global indices, including the benchmark S&P500 index.
“As such, they do not necessarily serve as the ideal economic gauge for investment decisions.
“Investors must bear this imbalance in mind.”
SRB launches public consultation on its ‘standardised Data Set’ proposals
New consultation covers minimum data needed for valuation of bank in resolution
The Single Resolution Board (SRB) today launches a public consultation on its ‘standardised Data Set’ to ensure that a minimum level of data is available to support a robust valuation for resolution.
In 2019, the SRB published its Framework for Valuation. Its objective is to provide independent valuers with the SRB’s expectations regarding the principles and methodologies for valuation reports, as required under EU law.
Read the full press release here
Pound could drop even further - to $1.18 - in June: deVere CEO
The pound – this month’s worst-performing major currency – could “easily drop to $1.18” at the end of June, warns the CEO of one of the world’s largest independent financial advisory and fintech organisations.
The warnings from deVere Group’s chief executive and founder Nigel Green come as it is revealed that the British currency shed almost 4% against the U.S. dollar in May and 3% against the euro.
Mr Green comments: “The pound is this year’s third-weakest major currency – just behind the New Zealand dollar and Norwegian krone, which have done even worse.
“The pound has been battered since the Brexit referendum in 2016 and the ensuing years of political uncertainty, losing around 20% of its value since the referendum.
“The Covid-19 crisis has been another hammer blow for sterling as it promoted a flight-to-safety and ramped-up the search for liquidity. This situation is a win for the U.S. dollar and, in turn, a loss for the pound.”
He continues: “There are legitimate concerns that the pound has further to fall in the next few weeks.
“It could easily drop to $1.17-$1.18 by the end of June due to renewed and heightened fears of a negative shock due to a no-deal Brexit combined with the far-reaching economic fallout of the pandemic.”
Negotiations between the UK and the EU on their post-Brexit future relationship stalled on Friday with the EU’s chief negotiator Michel Barnier saying the two sides risked reaching a “stalemate.”
The British Prime Minister Boris Johnson has repeatedly threatened to walk away from the talks if insufficient progress has been made by next month’s high-level negotiations. The UK has indicated the alternative of an “Australia-style” deal, a relationship where both sides trade on basic World Trade Organization terms, similar to a no-deal Brexit.
“An even weaker pound will help to reduce people’s purchasing power and a drop in UK living standards. Weaker sterling means imports are more expensive, with rising costs being passed on to consumers,” says Mr Green.
“The fall in the pound is good for exports some claim, but it must be remembered that around 50% of UK exports rely on imported components. These will become more expensive as the pound falls in value.
“A low pound is, of course, bad news for British expats, amongst others, who receive income or pensions in sterling.
“The country’s financial services sector – which represents 6% of all economic activity - will also be adversely affected because it is built on foreign investment that puts its faith in sterling being strong.”
The deVere CEO concludes: “The pound will remain volatile, and is likely to become weaker in the next month.
“As such, it can be expected that domestic and international investors in UK assets will be seeking the available international options available to them.”
Are rallying stock markets out of step with economic reality?
Buoyant stock markets are not necessarily ignoring alarming economic data, rather they are reflecting the post-pandemic era, affirms the CEO of one of the world’s largest independent financial advisory organisations.
The observation from deVere Group chief executive and founder Nigel Green comes as official figures on Friday revealed that more than 20 million people in the U.S. lost their jobs in April and the unemployment rate more than trebled.
Mr Green comments: “The staggering U.S. unemployment numbers wipe out a decade’s worth of job gains. There’s been nothing like this since the Great Depression.
“Yet U.S. stock futures climbed higher as global markets rose on Friday. This is highly unusual.”
He continues: “There are two things happening simultaneously here.
“First, a weak first half of 2020 has already been priced-in.
“As have the risks of a potential second wave – but the concerns of this are being largely contained as it is not such a ‘bolt out of the blue’.
“It is extreme uncertainty, the likes of which we saw at the peak of the pandemic, that typically upsets markets.
“Whether they are correct in their assessment remains to be seen, but markets are looking towards the second half of the year. They appear to believe that there is likely to be a steady economic recovery as key advances are made in coronavirus treatments, as central banks continue to implement and further bolster historic stimulus packages, and as lockdown restrictions around the world are eased to revive activity.”
He goes on to add: “Second, and perhaps more importantly, stock markets are reflecting what is going on in the economy right now and what it’ll look like post-pandemic.
“A closer look at the markets reveals that, of course, not all stocks and sectors are rising equally. They are being driven up across the board by the ‘winners’ of this new era including tech, biotech, home entertainment and established online retailers, amongst others.
“We can assume that these, and other stock market ‘winners’, are showing us what the future economy looks like.”
The deVere CEO concludes: “The optimistic stock markets seem at odds with the grim economic data. They may be being overly confident, even complacent.
“But it could also be the case that they are giving us clear signals for the current and future shape of the economy, in which there are and will be distinct winners and losers.
“A good fund manager will help investors seek out the opportunities and mitigate potential risks as and when they are presented to generate and build their wealth.”
Infographic: News Stories About the Death of Digital Currency Bitcoin Decline by 98 Percent
Reports in high-circulation newspapers forecasting the collapse of Bitcoin have fallen by around 98 percent since 2018. During the first four months of 2020, fewer critical BTC stories been published than ever before, according to a new infographic from Kryptoszene.de.
The study shows that only one article predicting Bitcoin's imminent demise was published between January and April this year. Last year, there were 15 articles in the same period, two years ago there were 51, and even at the end of last year there were significantly more critical articles with titles such as "Bitcoin is Dying", "All Crypto Currencies Will Disappear", or "Bitcoin, the End of an Era".
Between 2011 and 2018, of the 1,498 articles on Bitcoin analyzed, 53 percent were negative, 24 percent neutral and only 23 percent positive. However especially since the outbreak of the Corona crisis, it seems that more and more neutral and positive articles are being published concerning the crypto currency with the largest market capitalization.
In terms of its market price, the year so far has also been extremely successful for Bitcoin. While the DAX has lost 22% since the beginning of the year and the Dow Jones has also dropped 17.8%, the price of BTC rose by 21.8%. As the infographic shows, even gold - an insurance asset for times of crisis - could not keep up with Bitcoin. The market value of the precious metal increased by 15.2%.
"Various factors could be favoring the digital currency," says cryptoscene analyst Raphael Lulay. "This includes for example the limited quantity of Bitcoin, especially in times of inflationary fears. Even when compared to the currency Libra, however, Bitcoin performs comparatively well. The development is accompanied by assessments by policymakers who currently consider the potential risk posed by the digital currency to be 'low'".
The full story with the infographic, facts and more statistics:
Why responsible and sustainable (ESG) investing is now mainstream: deVere CEO
Economic and social upheaval plus the collapse of oil prices have pushed responsible and impactful investing further into mainstream finance, affirms the CEO of one of the world’s largest independent financial advisory organisations.
The comments from Nigel Green, the chief executive and founder of deVere Group, come as the global coronavirus emergency continues and as oil prices went negative this week for the first time in history.
Mr Green says: “At the start of 2020 I said that Environmental, Social and Governance (ESG) investing would reshape the investment landscape in this new decade – but this phenomenon has been dramatically and irreversibly accelerated by the current situation.
“Even before the start of the Covid-19 pandemic, ESG investments often outperformed the market and had lower volatility over the long-run.
“What is perhaps more impressive is that those investments with robust ESG credentials are still typically continuing to outperform throughout the coronavirus-triggered stock market crashes where major indices were extremely volatile, with some plummeting 20 per cent.
“Clearly, this is going to increasingly attract both retail and institutional investors seeking decent returns in turbulent times.”
He continues: “The collapse of oil prices, which are likely not to rebound to pre-crisis levels in the short-term, has also helped drive ESG investments to the top of the performance charts and keep them there.
“This is because ESG funds circumnavigate oil stocks, so their performance will not be adversely impacted by the fall in share prices.
“There is a wider and growing force behind the rise of Environmental, Social and Governance investing,” says Nigel Green.
“The current situation has acted as a wake-up call in many respects.
“It underscores that human health is reliant upon healthy ecosystems; that we need to ensure the sustainability of supply chains; and that those companies with robust corporate governance and good business practice fare better in difficult times and are ultimately best-positioned for the future.
“This growing collective awareness of mutual responsibility fits perfectly into the narrative of ESG investing.”
The deVere CEO concludes: “The collective wake-up call delivered by Covid-19 plus the search for profits in these highly unusual times are catapulting responsible, sustainable and impactful investing into the mainstream.”
Japan’s National Debt to GDP Ratio is 5x Higher than China’s and 2.5x than the US
Data gathered and calculated by Learnbinds.com indicates that Japan’s national debt to GDP ratio is at least five times higher than China and two and half times more compared to the US. From the data, Japan’s ratio is 279.34% while the United States is 111.41% and China has 52.30%.
Japan records a high national debt-GDP ratio
Japan’s ratio is the highest among the selected countries, with the United States occupying the fourth spot. On the other hand, China’s ratio is the lowest. Italy has the second-highest rate after Japan at 156.54% followed by France at 114.34%.
Canada's ratio stands at 107.65% followed by the Kingdom in the fifth slot at 104.27% while Brazil is sixth at 93.22%. In the seventh spot, India has 82.05% followed by Germany at 80.39%. According to the report:
“From an economic perspective, the ratio between a country’s national debt and its gross domestic product (GDP) is generally defined as the debt-to-GDP ratio. This ratio is a key indicator for investors to measure a country’s ability to manage future payments of its debts.”
The national debt to GDP ratio is a key indicator for investors to measure a country’s capability to manage future payments of its debts.
On the external debt to GDP ratio the United States (99.17%) figures are six times higher when compared to China (16.59%). The UK’s ratio is at least seventeen times higher when compared to China. Consequently, the UK occupies the top[ spot globally at 293.13% followed by France at 250.53%.
Germany occupies the third slot at 171.86% followed by Italy’s 148.85% while Canada closes the top five categories at 129.04%. Japan is sixth with a rate of 95.55% followed by Brazil at 35.52% while India’s 22.02%.
The full story, statistics and information can be found here: https://learnbonds.com/news/japans-national-debt-to-gdp-ratio-is-5x-higher-than-chinas-and-2.5x-than-the-us/
Stocks are ‘on fire’ – but a second coronavirus wave isn’t priced in
U.S. stock markets might be ‘on fire’ as earnings season begins – but Wall Street has not priced in a second wave of coronavirus, warns the CEO of one of the world’s largest independent financial advisory organizations.
The warning from deVere Group’s chief executive Nigel Green comes as the S&P 500 gained over 2 per cent in early trading, following gains in European and the Asia-Pacific markets.
Mr Green notes: “This week, with earnings season underway, we are going to see just the beginning of how corporate America and Europe have been hit by the coronavirus pandemic. The results are likely to be dismal and forecasts for the rest of the year can be expected to be revised down.
“However, investors are overlooking this. Instead, they are clinging on to relatively positive economic news from China, hints that some major lockdowns in Europe and elsewhere are being eased, and that confirmed cases are falling –meaning economic activity can be revived.”
He continues: “It’s truly astonishing that as global economic growth forecasts are looking bleak and most countries are battling potentially one of the worst downturns in a generation, the markets are on fire and trading as though these are normal times.
“They are not normal times. We are in unchartered waters. This isn’t the time to be complacent as I doubt the bear market is over. We shouldn’t call the bottom yet.
“It would appear that the financial markets are oblivious to the obvious and serious financial threat of a potential second wave of the coronavirus. Alarmingly, this does not seem to have been priced in.”
Mr Green goes on to add: “The markets’ bullish sentiment during this mass disruption and dislocation would be baffling enough, but there are also other headwinds on the horizon.”
These, he notes, include the U.S. Presidential election, the threat of a no-deal Brexit, and the longer-term inflation risks.
The deVere CEO observes: “We can expect markets to remain volatile in the short-term.
“Many savvy investors will be riding the wave of volatility to build up their portfolios through lower entry points and seeking value and decent returns in order to grow their wealth. Why? Because history teaches us that over the longer-term the performance of stock markets is fairly predictable: they go up.”
Nigel Green concludes: “The markets are growing more positive about the Covid-19 crisis.
“But to sidestep taking a potentially massive hit, investors must avoid complacency and emotional decisions through solid financial strategies.”
COVID-19 crisis: the SRB's approach to MREL targets
By Elke König
CHAIR AT SINGLE RESOLUTION BOARD
In this blog, I would like to provide additional clarity on the SRB’s approach to minimum requirements for own funds and eligible liabilities (MREL), taking the impact of the COVID-19 crisis into account.
First of all, the banking industry has made substantial progress in building up MREL to date and overall it is in a good position today. Nevertheless, during this challenging period, we are committed to ensuring that short-term MREL constraints do not prevent banks from lending to business and the real economy.
To achieve this, we are already working together with the banks under our remit and national resolution authorities to prepare for the implementation of the 2020 resolution planning cycle, including, in particular, the changes to MREL decisions under the new banking package (BRRD2/SRMR2). As part of this cycle, new MREL targets will be set according to the transition period in SRMR2, i.e. setting the first binding intermediate target for compliance by 2022 and the final target by 2024. The decisions will be based on recent MREL data, and reflect changing capital requirements.
As regards existing binding targets (set in the 2018 and 2019 cycles), in the current crisis, the SRB intends to take a forward-looking approach to banks that may face difficulties meeting those targets before new decisions (with 2022 intermediate targets) take effect. Our focus will be on the 2020 decisions and targets, and we ask banks to continue to make all efforts to provide the necessary data on MREL for the upcoming cycle.
We believe that this approach provides banks with the flexibility they may need in the coming months, as well as ensuring a level playing field. At the same time, our collective work on resolvability should carry on at a steady pace to ensure stability in our financial system.
About the article author
Dr Elke König is Chair of the SRB, responsible for the management of the organisation, the work of the Board, the budget, all staff and the Executive and Plenary sessions of the Board. She is a former President of the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin)) from 2012 until 2015. After qualifying in business administration and obtaining a doctorate, Dr König spent many years working for companies in the financial and insurance sector. Dr König was also a representative of the Supervisory Board of the Single Supervisory Mechanism.
Covid-19: covered bonds holding steady
Strong covered bond ratings coupled with the ECB backstop are giving banks access to funding if needed. Bank credit fundamentals and the credit quality of cover pools will likely weaken over time, but available buffers will support covered bond ratings.
Covered bonds have, once again in a crisis, become a preferred funding product. The public market is open: issuance has reached almost EUR 40bn in the last two weeks although it has become more challenging, as evidenced by 30bp-40bp of spread widening. “For now, we view this as an indication of changed investor perceptions of liquidity not concerns about credit quality. With 100bp widening seen on senior unsecured debt of the same issuer, covered bond spread volatility is much lower,” said Karlo Fuchs, head of covered bonds at Scope Ratings and co-author of a report out today on the impact on Covid-19 on this asset class.
Scope does not expect the safe-haven status of covered bonds to change, "although as differences in the credit risk of issuers and their cover pools emerge over time, covered bonds will reposition as a credit product,” Fuchs said, “especially as bank ratings deteriorate.” Banks will have to weather higher provisioning. The significance of asset-quality deterioration in their core corporate and retail lending activities will ultimately determine the impact on their ratings and ultimately on covered bond ratings.
“Mild one or two-notch bank downgrades will support covered bond ratings at current levels,” added Mathias Pleissner, a director in Scope’s covered bonds team and co-author of today’s report. “But significant asset-quality erosion could impact covered bond ratings if the ratings already rely on cover-pool support. The ability of a bank to generate sufficient liquidity to buffer against government-imposed or voluntary payment moratoriums or similar disruptive and system-wide events will be an important credit factor.”
The impact of missing repayments due to moratoriums is less relevant for covered bonds than for securitisations. The bank issuing the covered bonds must provide first recourse and make-whole payment delays. Unless a bank is close to regulatory intervention or a BRRD-like bail-in scenario, the share of loans subject to moratorium or payment holiday only serves as a traffic light for potential replenishment needs and potentially higher levels of over-collateralisation.
“Banks are able to increase protection available to their covered bonds, which allows them to mitigate deteriorations in their own ratings and/or changes to the credit quality of cover pools. A correction of sovereign ratings will not uniformly impact the credit quality of covered bonds. Rather, changes to the credit quality of the first recourse for covered bonds – the bank rating – will drive the extent of potential rating changes,” said Fuchs.
Encumbrance levels are still low and most issuers have ample additional cover assets, allowing them to replenish if and when needed. At the same time, moratoriums might require more active liquidity management by issuing banks as scheduled payments for cover assets might be delayed.
About Scope Ratings GmbH
Scope Ratings GmbH is part of the Scope Group with headquarters in Berlin and offices in Frankfurt, London, Madrid, Milan, Oslo and Paris. As the leading European credit rating agency, the company specialises in the analysis and ratings of financial institutions, corporates, structured finance, project finance and public finance. Scope Ratings offers a credit risk analysis that is opinion-driven, forward-looking and non-mechanistic, an approach which adds to a greater diversity of opinions for institutional investors. Scope Ratings is a credit rating agency registered in accordance with the EU rating regulation and operating in the European Union with ECAI status.
Coronavirus: global economy could be in recovery mode within SIX MONTHS - but on two conditions
The global economy is likely to be headed for recovery from a coronavirus-triggered downturn within six months – but only if mass testing is rolled out now and governments guarantee to support demand.
The prediction from Nigel Green, the CEO and founder of deVere Group, one of the world’s largest independent financial advisory and services organisations, comes as global stocks held steady on Tuesday, after rallying on tentative indicators the Chinese economy – the world’s second-largest - is stabilising following coronavirus lockdowns being lifted.
However, they retreated on Wednesday as the pandemic worsens in the U.S. – the world’s largest economy.
His forecast also follows the release of the UN’s latest trade report on Tuesday. It reads: “The world economy will go into recession this year with a predicted loss of global income in trillions of dollars.”
Mr Green says: “The economic fallout of Covid-19 is as severe as it is unpredictable.
“No-one knows for sure the full of extent of the impact of the public health emergency on the world economy – but a significant downturn is, unfortunately, almost inevitable.
“However, the signs from countries where lockdown restrictions are now being eased suggest that the economic downturn could be relatively short-lived if certain factors come into play sooner rather than later.
“Indeed, I believe that the global economy is likely to be headed for recovery from a coronavirus-triggered downturn within six months – but only if mass testing is rolled out now and governments guarantee to support demand.”
He continues: “Most of the world is currently in phase one: lockdown. The unprecedented lockdown measures are, of course, dramatically slowing economies as both supply and demand are hit.
“The next phase, phase two, needs to be mass testing. An aggressive mass testing agenda, the likes of which could soon happen in Germany according to reports, would allow potentially millions of people to leave lockdown early, get back to work, and help kick start economies.”
Mr Green goes on to say: “Once mass testing is implemented, we can expect to see supply increase. But what about the other essential factor: demand? Without it, economies will continue their downward trajectory.
“The coronavirus pandemic has been – and will continue to be for some time – a hammer blow to consumer confidence.
“This is why it is essential that governments around the world continue and increase their unprecedented support measures for these unprecedented times.
“G20 leaders must remain committed to fulfilling their pledge to do “whatever it takes” to minimise the social and economic damage of the coronavirus pandemic.”
Speaking to the media recently, the deVere Group CEO noted: “Investors around the world will now be looking at how China gets back on its feet economically. Did the extreme lockdown work? Were the public health facilities adequate? Will there be another outbreak as activity resumes? How will the authorities now kickstart the economy? How will these decisions, and the success of them, impact the rest of the world?
“I’m confident that global financial markets will stage a relief rally when there is a definitive signal that the infection rate is dropping and that cases have peaked. Investors will come off the sidelines and prices will jump.
“Therefore, the next stage in China’s public health and economic recovery is critical.”
Mr Green concludes: “The coming months will be extremely tough for many individuals, businesses and sectors, but there are also glimmers of hope that economic recovery might arrive relatively soon.
“But, ultimately, this will depend on the next two phases that we face.
“If mass testing is carried out stringently and immediately, we could be looking at recovery signs within six months. If there’s a failure to do this, we could be looking at much longer downturn.
“During these tumultuous times, people are being advised to review and revise their financial planning strategies to ensure they remain on track to reach their long-term financial goals.”
Google Searches for Buy Stocks Up by 466% Worldwide
Data gathered by Learnbonds.com indicates that global Google searches for ‘buy stocks’ have spiked by at least 466% between March 31, 2019, and March 27th this year. According to the data, there was a significant spike in the wake of rising COVID-19 cases.
March records highest searches
From the data, interest in buying stocks began in the last week of February. The phrase had a popularity score of 30, which remained the same in the first week of March.
In the second week of March, the searches shot up by 663% and later 809%. Between March 22 and 27th, the searches had increased by 466%.
With the effects of Coronavirus being felt all over, most stocks have seen their worst falls in history. The searches could mean that investors are aiming to take advantage of rock-bottom prices by buying certain stocks and seek to profit from it in the future.
The data further indicates that most searches originated from North America. During the period under review, the US and Singapore had a peak search score of 100 followed by Canada at 85.
Outside North America, United Arab Emirates has a popularity score of 39 searches with Australia occupying the fifth slot at 34.
Notable stocks that might be beneficial to investors include healthcare, technology, and consumer goods as they have a great potential of bouncing back.
The full story, information and statistics can be found here
Top 12 Gold Holders Worldwide by Country and Institutions in 2020
Data compiled by Finbold.com indicates that the United States holds the largest stockpile of the global Gold Reserves at 14.81% (8,965.15 tons). The data further shows that the global Gold Reserve stood at 58,710.48 tons by March 24.
The US controls 15% of all Gold Reserves worldwide, more than Germany and Italy combined
Germany has the second-highest gold reserves at 3,709.14 tons followed by the International Monetary Fund which has 3,101.53 tons in reserves. Italy is ranked fourth at 2,702.39 tons.
Interestingly, both Italy and Germany when combined have less Gold Reserves than the US. France occupies the fifth spot with Gold reserves of 2,684.98 tons.
Other countries and institutions with high reserves include Russia (2,504.21 tons), China (2,159.80 tons), Switzerland (1,146.12 tons), Japan (842.98 tons), India (686.03 tons), Netherlands (674.78 tons) and the European Union (556.04 tons).
According to the report:
“Countries usually buy gold as a defensive measure to protect against inflation, acquire loans and prevent economic meltdowns."
For most countries, Gold Reserves usually contributes to their creditworthiness in the issuance of currency and bonds.
An overview of the year to date (YTD) production of the world's top five precious metals shows that Lithium holds the top spot with a production of 21,420.80 tons. Silver comes second with 6,804.21 tons while gold has a production capacity of 821.54 tons.
Palladium and Platinum occupy the fourth and fifth spots at 48.23 tons and 36.75 tons respectively.
Precious metals are considered to be rare and have high economic value. These metals' high value is driven by factors like their rarity, uses in industrial processes and investment vehicles.
The statistics, charts and in-depth information can be found here: https://finbold.com/top-gold-holders-worldwide-by-country-and-institutions/
Glint sees gold buying soar as markets meltdown
Glint sees several hundred percent increase in the amount of gold clients buy over the last 5 weeks as global markets see meltdown and gold price reaches all-time high.
LONDON, UK.- Glint Pay Services Limited (“Glint”), the fintech company that makes gold an alternative global currency by enabling its clients to buy, sell, save and spend their physical gold instantly through Glint’s prepaid debit card (Mastercard)4 and multi-currency app, today announces that it has experienced a several hundred percent increase in its clients buying gold during the recent turmoil effecting global equity markets.
Glint’s clients have been the big winners as they flocked to gold, the safe haven currency of last resort, as the markets swung violently over the last few weeks on fears of a global economic downturn.
Global stock markets lost some USD 6 trillion to date, but even after a brief rally, shares around the world arguably had their worst day since the financial crisis of 2008, with the dramatic falls leading to the day being dubbed "Black Monday.” According to the Wall Street Journal  of 19 March 2020, the DJ Industrial Average and the S&P 500 have lost around 30% since they peaked in mid-February.
Compounding the situation is the ongoing tussle between Saudi Arabia and Russia over crude oil production levels, which has seen benchmark crude oil prices collapse to below USD 30/barrel for WTI and Brent crude.[2
Central banks around the world have cut interest rates and governments have injected massive amounts of money into the financial system to try to prevent further declines in equities and fend off corporate bankruptcies.
They are using the firepower they have to prevent what is by now a probable recession into becoming a serious depression.
Conversely the price of gold has hit some high points in both GBP and USD, trading on 19 March 2020 at USD 1,470 per ounce.
To date, Glint has more than 74,000 app downloads, tens of thousands of registered users and more than GBP 69 million in transacted volume.
Stock markets have recovered somewhat as central banks and governments have injected paper money into the financial system. However, this not a signal of ‘things returning to normal.’ Not least because it is no longer clear what that ‘normal’ might be – too many shocks are around.
In such politically and macro-economically volatile times it is natural that people search for safe havens –and gold has throughout history been seen as one of the safest. Gold has historically been a better store of value than any government created currencies, which typically erodes over time. Since 1970, the U.S. dollar has lost 86% of its purchasing power due to inflation2, whereas over the same period if you had held your wealth in gold, your purchasing power would have risen 505%1 (inflation adjusted).
In 1970, a cheeseburger would have cost you USD 0.55 cents in the US. In 2018, the same cheeseburger cost USD 3.47 due to the increase of U.S. annual average inflation, thus decreasing the value of the U.S. dollar. In 1970, a gram of gold would have bought you two cheeseburgers, whereas today a gram of gold would allow you to purchase twelve cheeseburgers. 2
“Glint’s mission to bring a reliable gold currency to the fingertips of everyone in the world is being validated as the global economy unravels,” said Jason Cozens, Founder and CEO of Glint. “Glint offers an alternative that is valued globally anytime, anywhere. Welcome to money’s new standard.”
As a fintech company, Glint is at the cutting edge of finance, enabling its customers to stay ahead of the fast-moving world of currency depreciation and exchange. “Gold has a crucial historic role as money, and we see it defining a future whereby people can take control over their own income streams and not leave them to the mercies of banks,” says Cozens. “As the world inexorably moves to being cashless, Glint provides a future-proofed solution to 24/7 globalized living.” adds Cozens.
Glint offer an innovative multi-currency payments solution that provides instantaneous ownership of physically allocated gold and the ability to use it as money digitally through an app and prepaid debit Mastercard (gold is converted into e-money for transactions).
Physically allocated gold belongs outright to its owner, as opposed to unallocated gold, “exposure to gold” such as when the gold is owned by a FinTech company (e.g. Revolut) or a capital markets instrument such as an exchanged traded fund (“ETF”). By offering access to gold Glint helps shield clients them from the destructive effects of inflation and protects them from the systemic risk of future global financial crises
Glint enables you to save, spend, and exchange between USD, EUR, GBP and gold wallets. Glint’s clients know their gold is securely held in a Brinks Vault in Switzerland. Brinks is insured with Lloyds of London.
In the next few months, Glint will launch Person to Person (P2P) payments, giving clients the ability to send gold and currencies to fellow Glint clients as easily and instantly as you might send a text message.
Fees are transparent and simple with Glint when buying or selling gold or spending in foreign currencies. There are no hidden fees and Glint uses the best available market rates with no Glint margin added, when transacting in 150 currencies around the word.
Glint has recently launched the ability for clients to experience no fees when making a gold-based purchase in their home currency of residence using the Glint pre-paid debit card (Mastercard).
You should be aware that Glint’s gold offering is not subject to regulation by the Financial Conduct Authority (“FCA”). Always speak to an independent financial adviser if you have any questions or concerns.
Glint is a FinTech that uniquely enables physical gold to be converted into e-money for spending via a pre-paid debit card (Mastercard). Glint also offers a multi-currency account. Glint enables its clients to buy, save and exchange physical gold and other currencies.
Glint’s vision is a world where everyone has an equal opportunity to prosper, made possible by providing everyone with a reliable form of money, gold.
Glint’s clients know their gold is secured in a Brinks Vault in Switzerland. Brinks is insured with Lloyds of London. Glint issues clients with e-money, via the Glint app, upon receipt of fiat funds. All e-money issued by Glint is held in safeguarded and segregated accounts.
Already available in the UK, SEPA3 and the US, Glint is set to launch in Canada, Japan, and Scandinavia in 2020.
Gold is the world’s alternative to government-controlled fiat currencies and has been a secure and globally accepted form of payment since 4,000 BC. Glint is a tangible alternative to cryptocurrencies, because it provides ownership of physical gold and permits instant gold-based purchases. Glint interacts with the global banking system and is a form of instantaneous payment for goods and services.
About Jason Cozens (Founder & CEO of Glint)
Mr. Cozens has more than 20-years' experience within the eCommerce technology and digital marketing sectors. Mr. Cozens is Chief Executive Officer and Founder of Glint. In this role, he is responsible for shaping the company’s strategy and overseeing the Glint technology platform. Prior to founding Glint, Mr. Cozens was the co-founder of GoldMadeSimple.com, a website he co-created in 2009 to provide customers with a fast and easy way to purchase physical gold bullion bars and coins. Before GoldMadeSimple.com, he helped to found Bite Digital Ltd., a 360° digital marketing and ecommerce development agency. Prior to that, he was the Director of Online Capital at DISC (later sold to Bartercard PLC) where he helped evolve their online group discount retail channel by increasing sales and efficiency through the introduction of technologies, marketing and integrated supply chain processes. Before that, Mr. Cozens was the Founder & CEO of Visuality Ltd., a digital agency that produced pre-build virtual reality visualisations of projects such as the Sydney Olympic and Wembley Stadiums and built and maintained the first ecommerce platforms for some of Europe’s high street retailers and manufacturers.
Investors seeking positive opportunities amid coronavirus gloom
Investors are now actively seeking ‘new world’ sectors and companies as the world readjusts to life with coronavirus and looks ahead to an economic recovery.
The assessment from Nigel Green, the chief executive and founder of deVere Group, one of the world’s largest independent financial advisory organizations with operations in 100 countries, comes as global stock markets rallied on Tuesday.
Mr Green notes: “Every economic downturn creates a new normal. The one being triggered by the coronavirus pandemic will be the same.
“The Covid-19 impact has hit firms across the world – there’s been immense international disruption - with many sectors experiencing major issues of supply, demand, or both.
“However there remain some sections of the economy which are benefitting from the coronavirus fallout.”
He continues: “Sensibly, investors are now actively seeking these ‘new world’ sectors and companies in order to grow and protect their wealth.
“This is evidenced by the tech-heavy Nasdaq Composite index which has done well, where other global indices have faltered.
“New industries will come into their own and, as ever, there will be winners and losers. This will mean job losses in some sectors and huge - possibly unprecedented - job and investment opportunities in others.”
Last week, in a media release, Nigel Green noted that a Covid-19 recession is likely “to fundamentally shift how we live, do business and invest.” He added that it could also be expected to “speed up the Fourth Revolution, which is fuelled by new technologies, such as Artificial Intelligence and mobile supercomputing.”
Mr Green goes on to say: “Big tech is just one likely winner. The likes of Apple, Facebook, Amazon, and Google’s parent company Alphabet have immense cash reserves to continue, maybe even bolster, research and development and to sustain their business operations.
“This sector is also likely to face higher demand as social distancing, isolation and quarantine affect much of its existing and potential consumer base.
“Plus, recently heightened regulatory restrictions and political opposition to their expansion and growth of influence is likely to be scaled back considerably.”
He adds: “For similar and other reasons, other sectors besides the Silicon Valley giants, are likely to continue to offer positives for investors.
“These include pharmaceutical and healthcare firms, delivery brands, supermarkets and manufacturers of electronic goods, such as fridges and freezers.”
Nigel Green concludes: “Of course, there will be a recovery from the global economic impact of coronavirus.
“But the world has already changed as a result of it - and will do so more - and savvy investors are aware of this new normal and are already readjusting their portfolios accordingly.
“Times of immense tumult can be times of great ingenuity, promise and opportunity.”
World’s Five Largest Banks see Investment Banking Revenue Slide to $26.1bn in 2019
Trade tensions, slow growth, and low-interest rates all left their mark on the world’s largest banks last year, affecting the investment banking revenue they racked up.
The five largest global banks hit $26.1bn in investment banking revenue in 2019, 3% down on the year, according to data gathered by LearnBonds. JP Morgan, ranked as the world’s largest bank, made almost $6.9bn profit from investment banking last year.
Global Investment Banking Revenue Slipped 4% in 2019
The keyrole of an investment bank is to help companies and governments raise capital from investors, such as pension funds or other money managers. The banks take the role of underwriter, making sure that bonds or stocks are competitively priced and sold. Investment bankers also help clients manage mergers and acquisitions.
In 2019, the twelve largest US and European banks generated $77.5bn from investment banking, or $3bn less compared to the previous year, revealed the Wall Street Journal and Dealogic data.
As market leader, JP Morgan gained 8.9% market share, a 0.3% rise compared to the year before. But investment banking income at the US giant dipped by more than $50m between 2018 to 2019.
Although the revenues of the world’s top investment banks plunged to a 13-year low in the first half of 2019, JP Morgan still managed to produce record income in the fourth quarter. The record earnings at the end of the last year were driven by the bond trading revenue, which surged 86% to $3.4bn, surpassing the $2.6bn estimate by roughly $800m.
Chief Executive Officer of the JP Morgan, Jamie Dimon said: “JP Morgan Chase produced strong results in the fourth quarter of 2019, capping off a solid year for the firm where we achieved many records, including record revenue and net income.
While we face a continued high level of complex geopolitical issues, global growth stabilized, albeit at a lower level and resolution of some trade issues helped support client and market activity towards the end of the year.”
Goldman Sachs, the second-largest investment bank in the world, ended 2019 with $5.8bn in investment banking revenue and a 7.5% market share. Compared to a strong 2018, the Wall Street institution suffered a near 7% slide in revenue from investment banking services. This fall reflected lower earrings in underwriting and financial advisory, partially offset by higher revenues in corporate lending during 2019.
However, the bank ended the year with $36.6bn in overall net revenues, including the fourth-quarter revenues of $10bn, its highest quarter since 2007.
Goldman Sachs chairman and chief executive David Solomon said: “Strong performance in the fourth quarter helped us to deliver solid results for the year while continuing to invest in new businesses. We aim to drive higher returns in the future.”
Leading American Banks generated One-Third of Total Investment Banking Revenue
Behind the two leading banks, Morgan Stanley and Bank of America ranked third and fourth with revenues of around $4.8 bn and $4.7 bn in 2019, respectively. Citigroup took fifth place on this list, with $3.8bn of revenue last year.
The 2019 data show the five leading US investment banks generated one-third of total investment banking revenue in the last year, holding a market share of more than 33%. The position of American banks in this area has been strengthened as a host of European banks - such as Deutsche Bank, Royal Bank of Scotland and UBS - have withdrawn from investment banking after suffering crippling losses in the 2008 financial crisis.
Analyzed by sector, financial institutions represent the leading field for investment banking services in 2019 with $16bn in revenue. Technology and Energy and Natural resources followed with $11.3bn and $9.7bn profit, respectively. The statistics indicate that JP Morgan was the leading bank in seven out of ten investment banking sectors. Goldman Sachs ranked as the leading investment banking service provider in the fields of technology, business services, and transport.
Global financial markets to use China’s recovery as a critical gauge
Global financial markets will use China’s recovery as a sentiment tracker, affirms the CEO of one of the world’s largest independent financial advisory and services organisations.
The comments from Nigel Green come as European and Asian-Pacific markets and U.S. futures fell after a stream of stark headlines over the weekend.
His observations also follow Chen Yulu, a vice governor at the People’s Bank of China, giving a press conference on Sunday at which he noted that two ways the country is contributing to global financial recovery is by maintaining domestic financial markets’ stability and by being involved in international talks on macroeconomic policy collaboration.
Mr Green says: “Since the World Health Organisation upped its rhetoric on Covid-19 due to the rapid spread, financial markets – including stocks, oil, government bonds and gold - have experienced wild bouts of volatility and major sell-offs.
“Investors are now not only monitoring the habitual markers like the price of gold and oil and international fiscal and monetary policies, but they’re also tracking the global health policies and Coronavirus-death tolls.”
He continues: “The epicentre of Coronavirus has shifted from China to Europe. Europe has now registered more Coronavirus cases and fatalities than China.
“Almost immediately, the Chinese authorities launched intense lockdown measures to try and halt the outbreak. It appears to have been successful, with cases having fallen considerably.
“However, the adverse impact on the world’s second-largest economy – which drives in a large part – the global economy - has been significant.”
Mr Green goes on to say: “As such investors around the world will now be looking at how China gets back on its feet economically. Did the extreme lockdown work? Were the public health facilities adequate? Will there be another outbreak as activity resumes? How will the authorities now kickstart the economy? How will these decisions and the success of them impact the rest of the world?
“I’m confident that global financial markets will stage a relief rally when there is a definitive signal that the infection rate is dropping and that cases have peaked. Investors will come off the sidelines and prices will jump.”
The deVere CEO concludes: “Therefore, the next stage in China’s public health and economic recovery is critical.
“What takes place in the People’s Republic will be used by investors as a sentiment guide and a gauge for the rest of the world, particularly the U.S. and Europe where Covid-19 transmissions are yet to peak.”
Bitcoin’s sharp recovery to take price beyond $7,000 in next week
The price of Bitcoin is likely to recover to at least $7,000 in the next week, with the wider cryptocurrency market receiving a major resurgence.
This is the bullish forecast from Nigel Green, the chief executive of deVere Group, one of the world’s largest independent financial advisory and services organisations.
It comes as the price of Bitcoin, the largest digital currency with a current market capitalisation of around $130bn, shot up by more than 20 per cent in 24 hours on Thursday.
Mr Green, who launched the deVere Crypto app in 2018, says: “Global financial markets – such as stocks, oil, currency, bonds and gold – experienced a massive sell-off this week. Investors who needed cash went into panic-mode about the coronavirus pandemic and whether governments' and central banks' policies are enough to mitigate the economic impact.
“Bitcoin was no different from any of these other assets - including the safe havens – it was just another asset to sell at the time.
“However, it has recovered significantly better than many other assets, jumping 20 per cent in 24 hours.”
He continues: “I’m confident that this upward trajectory will remain strong. The price of Bitcoin is likely to recover to at least $7,000 in the next week as the volatility in traditional financial markets, including fiat currency markets, looks likely to remain in the near-term.
“As such, a growing number of institutional and retail investors will seek to diversify their portfolios and hedge against the turmoil by investing in decentralised, non-sovereign, secure crypto assets, such as Bitcoin.
“In other recent times of market uncertainty, a growing consensus has been revealed that Bitcoin is becoming a flight-to-safety asset.
“Up to now, gold has been known as the ultimate safe-haven asset, but Bitcoin - which shares its key characteristics of being a store of value and scarcity – could potentially dethrone gold in the future as the world becomes increasingly digitalised."
Mr Green adds: “Moreover, the upswing in Bitcoin’s price will remain on track because the fundamentals remain intact – namely that cryptocurrency is the future of money.
“Cryptocurrencies like Bitcoin are digital and global. Digitalisation is often called the fourth industrial revolution and cryptocurrencies are digital by their very nature. Meanwhile, the borderless nature of cryptocurrencies makes them perfectly suited to an ever globalised world of commerce, trade, and the movement of people.
“It is also about demographics. Younger people, who are of course the future, have always lived in a digital era, so using digital currency is going to be second nature.
“In addition, there will be an acceleration of institutional investment which is likely to be driven by greater regulatory clarity. More and more global jurisdictions can be expected to join the likes of Malta, Hong Kong, Japan and Switzerland in becoming crypto-friendly from a regulatory and pro-business viewpoint. The institutional expertise and capital will bolster prices significantly.”
The deVere CEO concludes: “Volatility in traditional markets, combined with a growing consensus of it being a flight-to-safety asset, plus its strong inherent fundamentals will ensure Bitcoin’s continued upward trajectory.”
Majority of top global VC investors witness growth in investment volume but decline in value in 2019, says GlobalData
Six of the top 10 global venture capital (VC) investors showcased year-on-year (YoY) growth in the number of investments, whereas seven of them witnessed YoY decline in the proportionate investment value in 2019, says GlobalData, a leading data and analytics company.
The top 10 global VC investors (by number of investments) participated in more than 1,200 funding rounds in 2019 as compared to 1,110 funding rounds in 2018. However, the proportionate investment value of these VC firms declined from US$13.4bn in 2018 to US$10.5bn in 2019. The decline could be attributed to the lower proportionate investment value for majority of these VC investors.
Of the top 10 VC investors, six (Sequoia Capital, Y Combinator, 500 Startups, Accel, Kleiner Perkins Caufield & Byers and High-Tech Grunderfonds) increased their investment volume in 2019. In contrast, seven of them witnessed decline in the proportionate investment value in 2019.
Aurojyoti Bose, Financial Deals Analyst at GlobalData, says: “Despite an upsurge in the investment volume, shrinkage in the investment value indicates a cautious approach of VC investors towards making big investments.”
Interestingly, Sequoia Capital, which registered the highest investment volume and value in 2019, also witnessed decline in its proportionate investment value by 40% compared to the previous year.
The other top VC firms that witnessed decline in the proportionate investment value in 2019 included 500 Startups, New Enterprise Associates, Andreessen Horowitz, Kleiner Perkins Caufield & Byers, IDG Capital and High-Tech Grunderfonds. Of these, New Enterprise Associates, Andreessen Horowitz and IDG Capital also witnessed decline in the number of investments.
Y Combinator registered the highest growth in the number of investments as well as proportionate investment value in 2019 as compared to 2018.
Bitcoin Infographic: Number of Transactions Decreased by 23%, Inequality of Distribution Is Getting Worse
According to a new Kryptoszene.de infographic, Bitcoin saw an average of only 293,447 transactions daily in the fourth quarter of 2019, compared to 381,652 BTC in the first quarter. The wealth inequality within the crypto-community also continues to grow: $59.88 billion worth of bitcoins are concentrated in the top 0.01% of BTC accounts.
18.26 million bitcoins– 85% of the maximum total amount – are already in circulation. This correlates with a clear upward trend of the crypto-infrastructure. In March 2017, there were 1,066 Bitcoin ATMs installed worldwide. Since then, the volume has increased by 568% to 7,129 ATMs. However, the regional distribution is still quite uneven. Almost 80% of all BTC machines are located in North America. 17.3% of ATMs are located in Europe.
"It is difficult to assess the current situation," says Kryptoszene analyst Raphael Lulay. "On the one hand, the infrastructure is constantly expanding. The price development and the number of transactions are, however, subject to strong fluctuations. The spread of the coronavirus is also making the situation more ambiguous. At first, the crisis seemed to strengthen Bitcoins standing as crisis-asset. Meanwhile, the Bitcoin price is on a downward slide, as are the stock indices”.
The full story with the infographic, facts and more statistics:
Oil price war and coronavirus: global recession is almost inevitable
A global recession is now almost inevitable this year, warns the CEO of one of the world’s largest independent financial advisory and services organisations.
The warning from Nigel Green, chief executive and founder of deVere Group, comes as global stocks and government bond yields fell after oil prices plummeted by almost 30 per cent on Monday.
He notes: “Oil’s sharpest one-day drop since the 1991 Gulf war has further fuelled the sell-off in global stock markets that started a couple of weeks ago on fears that coronavirus is going to severely damage economic growth.
“Every major stock market is getting hammered as oil prices plunge due to a price war following the breakdown of Saudi Arabia’s oil-cutting alliance with Russia over the weekend.”
He continues: “This is an issue that will not be resolved overnight and it can be expected to have far-reaching consequences.
“It comes as the world scrambles to deal with the market mayhem and economic fallout caused by the relentless global spread of coronavirus.
“With the combination of the implications of the oil stand-off and the outbreak, I now believe that it’s almost inevitable that there will be a global recession this year.”
Before the oil price drop, last week Mr Green noted: “The outbreak has already sent the stock market into bouts of volatility not seen since the 2008 financial crisis, severely disrupted global supply chains, shuttered factories, grounded flights, closed attractions and cancelled major events. Entire powerhouse cities in Asia and Europe are nearly shut down. Multinational companies have warned that coronavirus will severely hit profits. Workers are being evacuated and forced to work from home and to avoid travelling.
“We can see both supply and consumer demand are already being impacted in key sectors, such as travel and tourism, hospitality, manufacturing and retail, and it is going to extend to others.
“This scenario is then likely to feed on itself: a lack of consumer confidence and spending, lack of business investment, more job cuts, which means even less spending and demand, which leads to further job cuts.”
The deVere CEO affirms: “In times of increasing volatility, investors need to ensure that they remain in the markets with their suitably diversified portfolios - not only to safeguard their wealth, but to create and build it too.
“As ever, there will be winners and losers and savvy investors and their financial advisers will be eyeing the opportunities that fluctuations, panic-selling and mis-pricing generate, allowing them to revise and add high quality equities to their portfolios at lower prices.”
Mr Green concludes: “The ultimate impact that the oil price war will have on an already vulnerable world economy that’s struggling to cope with the spread of coronavirus remains unknown.
“However, the risk of a short but severe global recession in 2020 has now been heightened dramatically.”
New era of negative rates looming? Investors move to top-up portfolios
A fresh era of negative interest rates is looming and investors are now seeking to top-up their portfolios with equities, says the CEO of one of the world’s largest independent financial advisory organisations.
Nigel Green, the deVere Group chief executive and founder, is speaking out after the U.S. Federal Reserve’s emergency rate cut on Tuesday – the first since the 2008 financial crash – as it tries to limit the economic impact of the coronavirus outbreak.
Mr Green affirms: “There’s been one historic cut already and there are signals that the Fed – the world’s de facto central bank – will make deeper cuts imminently.
“As it scrambles to protect the U.S. economy from the far-reaching fallout of the coronavirus, it can be expected that it could take rates back down to zero – emergency territory - in the next few months.
“This then raises the spectre that the Fed will ultimately follow its peers in Europe and Japan by adopting negative interest rates.”
He continues: “There is much debate and scepticism regarding the effectiveness of slashing rates in response to a global public health crisis and the resulting market turmoil.
“Negative rates can be misinterpreted by the public. They have been viewed as a warning to consumers and investors, that the underlying economies are in a dangerously weak position, and hit investor and consumer demand.”
Mr Green continues: “However, while the jury is out on whether negative interest rates help the real economy, there is no doubt that they help boost financial asset prices.
“As such, with coronavirus possibly ushering in a fresh era of negative interest rates, investors are now seeking to top-up their portfolios with equities before the next round of cuts and the likely subsequent price jump. They are seeking the lower entry points before the market surge.
“Those with savings in the bank are already getting battered by the ultra-low interest rates they are getting,
“Negative rates will give more investors more reason to increase their exposure to equities.”
The deVere CEO concludes: “There question mark remains on whether cutting rates from their already low levels will solve the issues created by the coronavirus outbreak.
“But rate cuts – and it is likely there will be deeper ones to come – will push up financial asset prices and right now many investors are looking to get ahead of the curve on this.”
Global sell-off could be seen by investors as best buying opportunity
in a decade
The worst global market sell-off since the 2008 crash will become an important buying-opportunity for investors, affirms the chief executive of one of the world’s largest independent financial advisory and services organizations.
The prediction by Nigel Green, CEO and founder of deVere Group, comes after equities lost a tenth of their value this week as investors piled into havens on growing concerns the coronavirus outbreak will hit the world economy and impact corporate profits.
Mr Green notes: “Until this week, the markets had largely shrugged off the impact of the outbreak of coronavirus. We warned about complacency leaving many wide-open to nasty surprises.
“This has now changed. Investors have done a ‘one eighty’ – from a muted overly confident reaction to the serious and far-reaching global issue of coronavirus to running like headless chickens.
“Both extremes are worrying and could potentially wreak havoc on investors’ returns.”
He continues: “However, the worst global market sell-off since the 2008 crash will almost certainly become an important buying-opportunity for many investors.
“With markets on the brink of correction territory, panic-selling, mis-pricing of high quality equities, and lower entry points, this could turn out to be one of the key buying opportunities in the last 10 years.
“Some of the most successful investors will embrace volatility to create, maximise and protect their wealth.
“As ever in times of increased turbulence, there will be winners and losers. A professional fund manager will help investors take advantage of the opportunities that volatility presents and mitigate potential risks.
Earlier this week, Mr Green noted: “In the current volatile environment, investors - including myself - will be revising their portfolios and drip-feeding new money into the market to take advantage of the opportunities whilst reducing risk at the same time.”
The deVere CEO concludes: “Global investors should not be spooked by the return of volatility on stock markets but, where possible use it to their financial advantage.
“Of course, no–one knows for sure what will happen in the immediate future but, as stock markets typically rise over a longer-term period, now is the time to capitalise on the more favourable prices of decent stocks.
“It can be expected that in coming days, serious investors will be bargain-hunting.”
Germany set for first green bond with innovative structure but little scope for higher issuance
Germany (AAA/Stable) is set to enter the sovereign green bond market in the second half of 2020 as part of a longer-term strategy to shift debt towards green alternatives. Future issuance depends on the government’s willingness to move to a green economy.
The German debt agency (Finanzagentur) is planning to issue green bonds as so-called twin bonds. The agency will designate a portion of bonds sold in conventional debt auctions as green bonds with the same maturity and coupon as their conventional bond twin, though as separate securities with their own ISINs. The green security will comply with the Green Bond Principles as defined by the International Capital Market Association (ICMA) so will be comparable to green bond issues by France (EUR 7bn in January 2017), Belgium (EUR 4.5bn in February 2018), and the Netherlands (EUR 5.98bn in May 2019).
“As a sovereign issuer, Germany is entering the green bond market later than some peers, but with a new strategy. Tying green bonds to conventional bonds could help to enhance market liquidity compared to issuing green bonds independently,” says Bernhard Bartels, lead analyst for Germany’s sovereign rating.
It is worth noting that KfW (AAA/Stable), the German government development bank that is seen as a sovereign proxy by capital markets by virtue of a Federal Republic guarantee, has been a regular issuer of green bonds since 2014. By the end of 2019, KfW had a total of EUR 22.6bn in green bonds outstanding.
The Federal debt agency has communicated to market participants that the expected size of its first green bond will be in the high single-digit to low double-digit billion range and mentioned the government’s intention to offer green securities along the entire yield curve out to 30 years.
“The government’s intention to offer green bonds on a broad scale could help ensure its position as a benchmark issuer, especially at the longer end of the yield curve,” says Bartels. “However, as long as the government sticks to its “black-zero” commitment, we see little scope for large-scale green bond issuance. Moreover, the replacement of some conventional bonds by green bonds does not necessarily generate a higher volume of green projects if already-existing projects are simply re-labelled in accordance with the green bond principles,” Bartels adds.
The scope for German green bonds is limited since the federal government’s debt burden has declined by around EUR 64bn from end-2012 to 2018, specifically, from EUR 1.39trn to EUR 1.32trn in 2018. The central government debt-to-GDP ratio has declined by 10pp to 40% of GDP over the same period, driven by steady growth and balanced budgets, reducing the need for debt issuance. In the absence of a debt-increasing investment programme to finance plans to become carbon-neutral by 2050, the ability to issue sovereign green bonds could remain restricted. Current programmes focus on budget neutrality, for instance by refinancing investments with environmental tax revenues.
The Green Bond Principles leave ample room for policymakers to define the use of proceeds. While the ICMA lists a number of possible uses, this list is not exhaustive and allows issuers to provide their own definition of environmental sustainability. In addition, the ICMA recommends a second-party opinion or certification of green bond programmes. Typically, governments finance infrastructure projects, energy-efficient housing or renewable-energy projects.
“As of now, the established ICMA framework does not guarantee the use of proceeds from green bonds for green projects given that they only provide guidelines, which allow the use of many instruments to serve a general purpose,” Bartels says. The upcoming green bonds will refinance existing green projects as well as new ones. For instance, the government could use green issuance to finance projects via the public energy and climate fund (EKF), part of which is currently used to reimburse energy companies for premature closure of coal plants.
Investors in sovereign green bonds rely on the selection of projects by respective governments and ministries for green ends. At the same time, many highly-rated issuers can expect low if not negative interest rates on green bonds given heightened market demand for these products. This may incentivise issuers to invest mainly in the reporting of projects as being green rather than programming new green projects.
Bloomberg’s cryptocurrency policy puts him on the right side of financial history
Presidential candidate Michael Bloomberg’s proactive cryptocurrency plans place him on the right side of financial history, affirms the CEO of one of the world’s largest independent financial services and advisory organizations.
The chief executive and founder of deVere Group is speaking out after the New York-based billionaire presidential hopeful proposed creating a regulatory framework for cryptocurrencies in a new financial regulation plan.
The plan notes: “Cryptocurrencies have become an asset class worth hundreds of billions of dollars, yet regulatory oversight remains fragmented and undeveloped.”
Mr Green comments: “Michael Bloomberg is, to date, the only candidate to become president of the world’s largest economy who has devised a coherent plan for cryptocurrencies.
“The staggering pace of the digitalization of economies and our professional and personal lives underlines that there will be – must be - growing demand for digital, global, borderless money.
“Indeed, digital currencies are now almost universally regarded as the future of money.
“This is why most central banks around the world – including the Federal Reserve - major financial institutions, tech giants, and multinationals are all getting involved.
“As such, Bloomberg’s proactive and progressive approach, which could be the first step to providing regulations to protect consumers and prevent illicit activity in the new age, must be championed.”
Nigel Green has long been a vocal advocate for cryptocurrency regulation.
He notes: “Digital currencies are already becoming mainstream and that means that they should adhere to the same standards as the rest of the financial system.
“Regulation is necessary as it will provide further protection for the growing number of people using cryptocurrencies, the less likely it will be that criminals will use these digital payment methods, the less potential risk there will be for the disruption of global financial stability, and the more potential opportunities there will be for higher economic growth and activity in those countries which introduce it.”
Last year, the deVere CEO criticised President Donald Trump who took to Twitter to say: “I am not a fan of Bitcoin and other cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air.”
In response, Mr Green blasted: “Does the President seriously think that traditional, fiat currencies are the way forward?”
Nigel Green concludes: “Cryptocurrencies are redefining and reshaping the financial system. The Leader of the Free World needs to be ahead of the curve and on the right side of history on such a fundamental issue.”
Responsible and sustainable investing the ‘new norm in less than five years’
Environmental, social and governance (ESG) investing will be “the new norm in less than five years”, affirms the CEO of one of the world’s largest independent financial services and advisory organizations.
The bold prediction from Nigel Green, chief executive and founder of deVere Group, which does business in 100 countries, comes as Amazon boss Jeff Bezos commits $10bn to fight climate change.
Mr Green notes: “Responsible and impactful investing is already fundamentally reshaping the global investment landscape.
“It is the trend that will define the 2020s – so much so that I’m confident that environmental, social and governance (ESG) investing will be the new norm in less than five years.”
He continues: “The growth in responsible investing will be driven by demand by both retail and institutional investors.
“Global awareness has skyrocketed about environmental, social and governance considerations over the last 12-18 months, in part due to the activism of the likes of Greta Thunberg, Extinction Rebellion and Jane Fonda, and due to the growing media coverage of climate change and its serious effects.
“As a result, these issues now sit at the heart of the investment decision-making process amongst eight out of 10 millennials, according to a recent deVere survey. Some argue this is likely to be even higher for Generation Z.”
This is of major consequence due to the Great Wealth Transfer. “This will see an estimated $68 trillion pass down from baby-boomers to millennials over the next couple of decades – and it could make them even richer than previous generations. It’s expected that this significant wealth transfer will begin in the next few years,” affirms the deVere CEO.
Currently, the U.S. and Europe lead the charge in ESG investment, with 80% of the responsible-investing market. Asia is currently lagging behind. But, says Mr Green, this could change and will further fuel demand.
“By 2025, Asia will be home to 33 of the world’s 49 megacities, according to Global Data. The rise in the number of megacities – cities in which there are more than 10 million permanent residents – will be fuelled by millennials who seem to be fully on board with ESG.”
“In addition, ESG investing will allow governments across Asia to realise some of their wider major policies. These include shrinking labour forces and weakening economic growth, migration, and global low-carbon transition threats.
“Demand for ESG-related strategies will go stratospheric when Asia goes full throttle into this direction, which it will do.”
Nigel Green goes on to say: “As the sector develops around the world, naturally, institutional investors will pile in, bringing with them their institutional capital and institutional expertise. This will act as a further catalyst for the ESG investment arena.”
He goes on to say: “One of the most compelling reasons why responsible investing will be the defining trend in less than five years is due to an increasing amount of evidence and ongoing research that ESG-related strategies can regularly outperform the market.
“It would not be unreasonable to assume that those companies that offer ESG-compliant investment could ultimately become some of the world’s most valuable companies. Could they take over from the current big tech firms? I would not be surprised.”
The deVere CEO concludes: “The investment world is evolving perhaps more rapidly than it has in decades due to the rise and rise of responsible and impactful investing.”
SRB launches public consultation on changes to its MREL policy under the 2019 Banking Package
The Single Resolution Board (SRB) today launches a public consultation on a number of substantial changes to its policy on the Minimum Requirement for Own Funds and Eligible Liabilities (MREL). These changes bring the policy in line with the amendments introduced by the 2019 EU “Banking Package” to EU regulations and directives.
This document describes the proposals, provides the rationale and highlights several specific questions to which the SRB seeks responses. The SRB is eager to receive responses and suggestions from a full range of stakeholders.
The consultation is open until 12.00 Brussels time on 6 March 2020. The answers will support the SRB in preparing its final MREL Policy Statement, expected to be published by end April 2020.
The proposals cover the implementation of provisions related to, among others:
MREL requirements for Global Systemically Important institutions (G‑SIIs);
Changes to the calibration of MREL, including introducing MREL based on the leverage ratio;
Changes to the quality of MREL;
Dedicated rules for certain business models, such as cooperatives, and for resolution strategies, such as multiple point of entry (MPE);
How these changes will be phased in.
MREL decisions implementing the new framework will be taken based on this policy in the 2020 resolution planning cycle by Q1 2021.
This public consultation is part of the SRB’s commitment to listening to the views of industry and other stakeholders and being transparent about its approaches and decisions.
SRB announces the appointment of new Vice-Chair and Board Members
The Single Resolution Board (SRB) is pleased to announce the appointment of Jan Reinder De Carpentier as Vice-Chair and Pedro Machado and Jesús Saurina as Members of the Board and Directors of Resolution Planning and Decisions. They will take up their duties on 1 March 2020.
The European Commission, in consultation with the SRB, carried out a stringent recruitment process and proposed the appointees as candidates to the European Parliament. After the European Parliament approved the proposal on 30 January 2020, the Council, acting by qualified majority, adopted the appointments on 17 February 2020.
Meet the Vice-Chair
Jan Reinder De Carpentier joined the SRB in 2015 as General Counsel in charge of the Legal Service, SRB Secretariat and Compliance function, providing strategic legal advice across the organisation and to the Single Resolution Mechanism stakeholders. He joined the Dutch central bank in 2002 and held various management positions, with a focus on anti-money laundering supervision, legal advice, early intervention strategies and crisis management. A Dutch national, Jan Reinder started his career in 1995 as a lawyer in private practice in The Hague and Amsterdam and holds a master’s degree in civil and tax law from Erasmus University in Rotterdam.
Meet the Members of the Board and Directors of Resolution Planning and Decisions
Pedro Machado has worked in financial regulation and supervision for close to 20 years. He is the Director of Legal Services and Chief Legal Counsel at Banco de Portugal, where he has also previously served as Deputy Director of the Prudential Supervision Department. A Portuguese national, he was the Minister of Finance’s Chief of Staff between 2011 and 2013, and has worked in the European Central Bank and PwC. From 2012 to 2015, Pedro was a non-resident member of the European Investment Bank’s Board of Directors. He holds a law degree from the Lisbon School of Law and has done post-graduate studies in European Law at the European University Institute.
Jesús Saurina is currently Director-General at Banco de España, responsible for Financial Stability, Regulation and Resolution, as well as being a member of its Executive Board and Governing Council. He has developed his whole career in the Banco de España, starting in supervision and then setting up and leading the Financial Stability Department. A Spanish national, Jesús has also been a board member of the Spanish resolution authority, FROB, as well as of the Spanish Deposit Guarantee Fund. He is currently a member of the Basel Committee on Banking Supervision, as well as a board member of the SRB’s Plenary Session and of the European Banking Authority. Jesús holds a Ph.D. in Economics from the Universidad Complutense de Madrid, and did postgraduate studies at CEMFI.
The new appointments replace Vice-Chair Timo Löyttyniemi and Board Members Antonio Carrascosa and Dominique Laboureix.
“I am delighted to welcome Jan Reinder, Pedro and Jesús. They each bring vast experience and knowledge to the SRB. Jan Reinder has been instrumental in building up the organisation, while Pedro and Jesús have had impressive careers in their respective central banks with a deep engagement in financial stability, as well as bank resolution. Together we will focus on our mission to make all banks resolvable, which in turn protects financial stability and the taxpayer.”- Elke König, Chair of the Single Resolution Board
“It is an honour to be taking up the role of Vice-Chair of the SRB. I have been with the SRB as General Counsel for more than four years and this new position is a challenge I am looking forward to, as the SRB continues its important work to promote financial stability.” - Jan Reinder de Carpentier, newly appointed Vice-Chair
“I am very pleased to be joining the SRB in the coming weeks. Resolution has been part of my work in different periods of my career over the last decade. I feel very committed to bringing my experience to improving bank resolvability through sound planning. It will be an honour to serve at the SRB and contribute in a meaningful way to the Banking Union, a fundamental endeavour of the European project.” - Pedro Machado, newly appointed Member of the Board
“It is both inspiring and challenging to be part of the SRB, an institution that has already demonstrated that it is possible to resolve a bank protecting taxpayers’ money, depositors, financial stability and the critical functions of the bank.” - Jesús Saurina, newly appointed Member of the Board
Bitcoin’s price jumps to $10,300 – what’s the REAL driving force of the rally?
Bitcoin’s price has soared to $10,300 on comments made on Tuesday by the U.S. Federal Reserve Chair – but there are other major factors at play driving the price, which has jumped more than 40% since the beginning of 2020.
This is the warning from Nigel Green, deVere Group CEO and founder, as the world’s largest cryptocurrency jumped more than 4% on comments made by Jerome Powell that the Fed is investing a significant amount into digital currency development.
Mr Green states: “This is further evidence that not only all major banks, government agencies, plus most sectors including tech, entertainment and real estate, are piling into cryptocurrencies – but that central banks are too.
“The previously sceptical Fed has not, until now, admitted how rapidly digital currencies could become a systemic risk to the U.S. dollar’s status as global reserve currency.
“This is a major step in underscoring – especially to those backward-looking traditionalists – that, whether they like it or not, digital global currencies are not only the future of money, they are increasingly the present too.”
He continues: “The development from the Fed comes following news that China – a communist state and the U.S.’s main economic rival – is currently developing what has been described as an all-powerful cryptocurrency. It could be ready this year and be the world’s sovereign digital currency.”
Mr Green goes on to say: “Whilst there will be minor peaks and troughs – as in all markets - I predict the overall trajectory of Bitcoin to remain upward for the next few months.
“Besides increasing institutional awareness and development, other major factors driving its price advance will be coronavirus.
“Bitcoin’s price is likely to continue to jump until the coronavirus peaks because of the growing consensus that the digital currency is a safe-haven asset.
“Its status comes from the fact that it is a store of value, scarce, perceived as being resistant to inflation, and a hedge against turmoil in traditional markets.”
He adds: “Another major price driver will be the next halving event.
“The code for mining Bitcoin halves around every four years and the next one is set for May this year. When the code halves, miners receive 50% fewer coins every few minutes. History shows that there is typically a considerable Bitcoin surge resulting from halving events.”
The deVere CEO concludes: “The Fed’s public acknowledgement of cryptocurrencies was important, but most investors have already known that major central banks around the world are developing crypto.
“As such, the main drivers for Bitcoin price for the next few months will remain coronavirus and May’s having event.”
German cryptocurrency IOTA by 2035 - 100 times the value of today
Signs of IOTA breakthrough are evident: rising ratings, exchange rate explosion and bitcoin outperformance
IOTA share price increased by around 119% since January 1st
Highest ranking on Google in a year
According to the study, market capitalization could increase more than a hundredfold by 2035
IOTA is again in the top 20 most valuable cryptocurrencies
According to an infographic by Kryptoszene.de, 2020 began with a bang for the cryptocurrency IOTA: within a few weeks, the exchange rate increased by around 119%. The Demand has peaked, and, as the graph shows, experts even see it as realistic that the price of the cryptocurrency “Made in Germany” will rise hundredfold over the next few years.
On January 1, the Internet of Things currency was still trading at $0.16. Just over a month later, on February 3, the cryptocurrency broke the $0.35 mark. IOTA even developed far better than all the altcoins and bitcoin. BTC price climbed around 29.3% during this period. In a market capitalization ranking, IOTA is currently at the 17th place and is back in the top 20 after several months.
An evaluation by Kryptoszene.de based on data from Google Trends shows that IOTA has never ranked as high in the past 365 days as it did in the last week of January. The Google Trend Score was at 100, which stands for the highest possible search volume. It is also evident that the investors are not only greatly interested in IOTA, they are also extremely optimistic about it. On February 3, 94% were optimistic about the development of the cryptocurrency, only 6% expressed their skepticism.
Here is the detailed article with further interesting information and infographics:
Saudi investment rises despite controversies, says GlobalData
Following the news that foreign direct investment (FDI) inflows to Saudi Arabia grew 10.2% year-on-year (y-o-y) to reach $3.5bn in the first nine months of 2019 compared with January-September 2018, when the amount equaled $3.18bn;
Colin Foreman, Deputy Editor at GlobalData, a leading data and analytics company, offers his view:
“Saudi Arabia’s economic reforms and new construction projects continue to attract growing volumes of FDI into the Kingdom. However, while the latest FDI figures show that progress is being made towards its Vision 2030 economic goals, there are signs that the growth rate could be plateauing.
“In the January-September 2018 period, inflows to the Kingdom grew by more than 170% compared with the corresponding period in 2017, when inflows were valued at just $1.16bn.
“The simple explanation could be that after starting an initial jump from a low base, the rate of growth for FDI is now less spectacular. Another more challenging explanation may be that international controversies involving Riyadh have tempered Saudi Arabia’s ability to attract FDI.
“The 2019 FDI numbers came shortly after the murder of Jamal Khashoggi by Saudi government officials in Istanbul in October 2018. The incident had an impact on business, with the likes of the UK’s Richard Branson suspending his business activities in the Kingdom.
“In 2020, Saudi Arabia is looking to move forward. The raft of projects that it launched in 2017 is now moving into construction and requires investment.
“The government’s privatisation drive will also continue following the initial public offering of Saudi Aramco at the end of last year.
“While economic strides are being taken, the controversy will nevertheless persist. In mid-January, there were claims that Saudi Crown Prince Mohammed bin Salman bin Abdulaziz al-Saud had hacked a mobile phone owned by Amazon owner Jeff Bezos.
“Although the Saudi government quickly dismissed the allegations as ‘absurd’, it could, as with the Khashoggi murder, have a dampening effect on FDI.
“That said, the data for 2019 shows that the weight and scale of Riyadh’s economic reforms and new projects across the Kingdom are still an attractive proposition for investors, and as long as that continues the outlook for Saudi Arabia remains positive.”
Seed and Series A funding rounds registered highest share of global VC investment volume and value in Q4 2019, says GlobalData
Seed and Series A funding rounds accounted for a 38.3% and 24.4% share of global venture capital (VC) funding volume and value in the fourth quarter (Q4) of 2019, which is the highest among all funding rounds, according to GlobalData, a leading data and analytics company.
Early stage funding rounds (Seed and Series A funding rounds) continued to dominate VC investments with a 74.7% share of total investment volume during Q4 2019.
On the other hand, late stage funding rounds such as Series E, Series F, Series G and Series H were fewer in number compared to early stage deals but much larger in average deal value.
A total of 2,753 deals (with disclosed funding rounds) worth US$45.5bn were announced during Q4 2019 compared to 2,325 deals during Q4 2018 that were worth US$39.2bn.
The US accounted for 43.8% of total early stage funding volume and 42.4% of growth/expansion/late stage funding (comprising Series B, Series C, Series D, Series E, Series F, Series G and Series H). It was followed by China, which accounted for 14.7% of early stage funding volume and 23.5% of growth/expansion/late stage funding volume in Q4 2019.
Other key countries that attracted a significant number of early stage funding during Q4 2019 included the UK, India, Germany, Canada, France, Japan, Israel and South Korea.
Growth/expansion/late stage funding accounted for around 70% of funding value in Q4 2019. China’s share of the capital raised through these rounds accounted for approximately 64%, followed by India with approximately 26%.
Other key countries that raised notable funding during Q4 2019 included Japan, Hong Kong, Indonesia, Australia and South Korea.