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Showing posts from September, 2017

An Essay On Bitcoin Pricing

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The concept of bitcoin is really fantastic. Groups of people join together sharing power and computer power and by virtue of the blockchain and its characteristics, you create more coins. As far as sharing or using the coins you still are able to use the blockchain system to send the coins around to vendors and anyone who has a wallet or accepts the coins. Also, to make it easier, there are massive decimalization abilities. 
So why does Bitcoin cost a lot of money now? Well in all actuality the Blockchain system is probably worth $10-50 billion. Maybe even $100 billion if there turns out to be a game changing enterprise adaptation. And while the coins are currently part of a much larger asset bubble and self perpetuating market being manipulated by those market makers – it also has a value because it was the original vehicle on which blockchain was created. Maybe the real value is $150.00 a coin. It's almost impossible to gather a sober cash settlement price now due to the complex…

Cyclically adjusted price-to-earnings ratio (Should we be worried?)

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The C.A.P.E. ratio is above 30 today, compared with an average of 16.8 since 1881. It has been above 30 in only two other periods: in 1929, when it reached 33, and between 1997 and 2002, when it soared as high as 44. - Sept 15, 2017 Robert Shiller





Using market data from both estimated (1881 - 1956) and actual (1957 onward) earnings reports from the S&P index, Shiller and Campbell found that the lower the CAPE, the higher the investors' likely return from equities over the following 20 years. The average CAPE value for the 20th century was 15.21; this corresponds to an average annual return over the next 20 years of around 6.6 per cent. CAPE values above this produce corresponding lower returns, and vice versa. In 2014, Shiller expressed concern that the prevailing CAPE of over 25 was "a level that has been surpassed since 1881 in only three previous periods: the years clustered around 1929, 1999 and 2007. Major market drops followed those peaks".





Cape Ratio :

1) A r…

Bank of Japan Owns 60% of Japan ETFs

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Nominal exports valued in yen increased 18.1% from the same month last year in August, following July’s 13.4% rise, overshooting the 14.7% increase that market analysts had expected. The expansion, the fastest since November 2013, was driven by growing sales to the rest of Asia, which rose 19.9%, and an acceleration in growth of exports to North America, which went up from a 13.0% increase in July to 22.9% in August. The external sector is benefiting from a weak yen and stable global demand. Growth in imports moderated from 16.3% in July to 15.2% in August. The print overshot the 11.8% rise that markets had expected. The strong growth in imports are a clear indication of strong domestic activity. The trade surplus went from a JPY 350 million deficit in August 2016 to a JPY 114 billion surplus in August 2017. Accordingly, in the 12 months leading up to August, the trade surplus inched up to JPY 3.3 trillion, which was higher than the JPY 3.2 trillion surplus recorded in the previous m…

The Securities Law Blog: Attorneys Should Practice Truth In Advertising — A...

The Securities Law Blog: Attorneys Should Practice Truth In Advertising — A...: Attorneys Should Practice Truth In Advertising — Alabama Injury Lawyer Blog "You rarely see these billboard and television lawyers he...

Ethanol Outlook September 2017

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Ethanol prices remained relatively unchanged over the past month, as increasing production in the U.S. and Brazil kept a tab on demand-induced upward price pressures. The spot price registered on 8 September was USD 1.64 per gallon. The price was 0.6% higher than on the same day last month, and was down 6.3% on a year-to-date basis. However, it was 6.5% higher than on the same day last year. The price of oil, a substitute for ethanol, has remained relatively unchanged over the past month, contributing to ethanol’s low monthly price variation. In the U.S., a court on 28 July ruled against the Trump administration’s efforts to curb biofuel use, which will likely support ethanol prices going forward on the back of more predictable U.S. domestic demand. In Brazil, RenovaBio—a federal program designed to cut emissions—is expected to be announced soon, which should boost future ethanol demand. On the supply side, the Brazilian Chamber of Foreign Trade approved a two-year twenty-percent tar…

Russian Economics And A Look At The Russian Economy

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How is Russia doing? The country has no problem making the news but the economics of Russia are not always discussed. Russia is a fascinating country that perseveres in a vast  complex environment and the mix of economic data coming from the country is fascinating. Below is a snapshot on the Russian economy and the experts at FocusEconomics.  - CH
A preliminary estimate revealed that the economy continued to pick up steam in Q2, with GDP expanding at the fastest pace since Q3 2012. While a breakdown by components is not yet available, the acceleration was likely broad-based as monthly indicators for consumption, investment and exports all performed well in the quarter. Early data for Q3, however, is less positive. Industrial production growth slowed to a four-month low in July, and the manufacturing PMI dropped in August. Meanwhile, the Central Bank took steps to curtail some concerns over Russia’s banking sector in August which included rescuing troubled lender Otkritie, the country’s…

Interest Rate Chatter

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House view is that rates should stay untouched for next 6-18 months. We will see how that goes. - CH

Federal Reserve Governor Lael Brainard said the U.S. central bank needs to pay careful attention to underlying inflation before raising interest rates again, as longer-run price pressure trends appear to be lower. - Bloomberg

“My own view is that we should be cautious about tightening policy further until we are confident inflation is on track to achieve our target,” Brainard said in a speech at The Economic Club of New York on Tuesday. If inflation continues to fall short of the central bank’s 2 percent target, “it would be prudent to raise the federal funds rate more gradually.” - Lael Brainard
Headlines from the last time Bullard spoke, on June 29:
Current level of Fed rates appropriateSmall effect on inflation if unemployment fallsWeak inflation data questions rise to 2%Low unemployment is probably not an indicator of meaningful higher inflation over the forecast horizonRecent inflat…

Global Outlook Improves

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Dynamic global trade and improved labor markets, coupled with fiscal stimulus and accommodative monetary policies in key countries, are prompting the global economy to consolidate its healthy growth trajectory. A comprehensive estimate for the global economy corroborates that GDP expanded 3.1% annually in Q2, matching the result in Q1 and in line with what our Consensus Forecast had expected last month. Economic momentum is expected to continue in Q3, with the global economy forecast to expand 3.1% again.

Economic activity improved in most of the advanced economies in Q2, with the Euro area leading the pack. The euro bloc’s economy expanded at the fastest pace in over six years on the back of robust domestic demand. The Euro area’s strong recent economic performance is largely due to a declining unemployment rate, along with the European Central Bank’s (ECB) monetary stimulus program. Against this backdrop, analysts are now betting on the timing of monetary policy normalization in the …