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$4,875: Bitcoin Price Surges toward All-Time High as Altcoins Plummet

CryptoCoins News, 1/1/0001 12:00 AM PST

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$4,875: Bitcoin Price Surges toward All-Time High as Altcoins Plummet

CryptoCoins News, 1/1/0001 12:00 AM PST

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STOCKS SLIP: Here's what you need to know

Business Insider, 1/1/0001 12:00 AM PST

slip slide water

Stocks fell as investors mulled the latest political developments and as they gear up for corporate earnings reports, which pick up later this week.

The S&P 500 lost 0.2%. Meanwhile, the Dow slid 0.1% and the more tech-heavy Nasdaq slumped 0.2%. Trading was lighter than usually as the bond market was closed for the Columbus Day holiday.

First up, the scoreboard:

  • Dow: 22,753.76, -19.91, (-0.09%)
  • S&P 500: 2,543.72, -5.49, (-0.22%)
  • Nasdaq: 6,579.14, -11.19, (-0.17%)
  • US 10-year yield: 2.36%, -0.01
  • WTI crude oil: $49.55, +0.26, +0.53%

1. Earnings season, the most important time of the year for stocks, is almost here. Banks across Wall Street think the upcoming results will be good for stocks, but for different reasons.

2. The stock market just flashed a dangerous warning signal. The S&P 500's relative strength index just crossed above 70, indicating the index is overbought, and signaling potential selling to come.

3. Goldman Sachs says gold got rejected at a key level and could be setting up for a big drop. The yellow metal has raced to a gain of more than 10% so far this year as the US dollar has stumbled amid President Donald Trump's inability to deliver on campaign proposals.

4. Bitcoin is closing in on its all-time high. The price of the red-hot currency was up more than 4% on Monday, above $4,800 a coin, and is less than $200 shy of its all-time high of $4,983.

5. Macquarie says central banks have tricked investors and created a 'doomsday machine.' Analysts at the firm say any policy mistake could undo their efforts and shake up the global economy.

ADDITIONALLY:

GE is sliding after an activist investor lands a board seat

BARCLAYS: We’re still waiting on Tesla’s 'iPhone moment'

Movie theaters are being pummeled by a surprisingly poor Blade Runner performance

KEN ROGOFF: Bitcoin will eventually collapse

Walmart is spiking after announcing a tech-savvy return policy

We should turn Puerto Rico into a haven for climate and clean energy research

Shares in an Australian startup that counts Lady Gaga among its investors have skyrocketed 300% in 6 months

Join the conversation about this story »

NOW WATCH: The secret to Steve Jobs' and Elon Musk's success, according to a former Apple and Tesla executive

Bitcoin is closing in on its all-time high

Business Insider, 1/1/0001 12:00 AM PST

Screen Shot 2017 10 09 at 3.16.30 PM

Bitcoin is closing in on its all-time high.

The price of the red-hot currency was up more than 4% on Monday above $4,800 a coin, less than $200 shy of its all-time high of $4,983, according to data from Markets Insider. 

Bitcoin hit nearly $5,000 at the beginning of September, but quickly saw its price decline amid news of a crackdown in China on the cryptocurrency and regulatory uncertainty around initial coin offerings, a cryptocurrency-based fundraising method. After bottoming out near $2,900 per coin on September 15, it has since rallied.

That's despite mounting criticism from some of Wall Street's most powerful players. 

It all started on September 12 when JPMorgan CEO Jamie Dimon called bitcoin "a fraud" and said it was "worse than tulips bulbs" in the 1600s.

In a recent interview with Bloomberg News, Larry Fink, the head of BlackRock, the world's largest investor with $5.7 trillion under management, said he thinks the explosive growth of bitcoin points to nefarious behavior

"It just identifies how much money laundering there is being done in the world," Fink said. "How much people are trying to move currencies from one place to another."

Kenneth Rogoff, the former chief economist of the International Monetary Fund, weighed in on bitcoin Monday, saying "in the long run, the technology will thrive, but that the price of bitcoin will collapse."

SEE ALSO: KEN ROGOFF: Bitcoin will eventually collapse

Join the conversation about this story »

NOW WATCH: THE BOTTOM LINE: The 'Trump trade' is back and Ray Dalio breaks down the bitcoin bubble

Movie theaters are being pummeled by a surprisingly poor Blade Runner performance (AMC, RGC, CNK)

Business Insider, 1/1/0001 12:00 AM PST

Blade Runner 2049 Warner Bros

Movie theater stocks are getting hammered after the poor performance of Blade Runner 2049.

The movie was the best performing film on its opening weekend but pulled in much less than expected. The 35-year-later sequel to "Blade Runner" was expected to make between $45 - $55 million on its opening weekend but only grabbed $31.5 million, according to Box Office Mojo.

AMC Entertainment was down 6.74%, Cinemark was down 3.56% and Regal was down 3.99%. The movie missed estimates by as much as $23.5 million, but the Monday drop in stock price for the cinemas wiped about $303.23 million of value from the three companies.

The movie was received well by fans and critics but was about 2.5 hours long and catered to fans of the original movie. According to Cinemascore, only 14% of the weekend's watchers were under 25.

The movie cost about $150 million to make and market, according to Box Office Mojo. Its predecessor brought in $32.8 million in its lifetime, and was the second most popular movie on its opening weekend, coming in under the blockbuster E.T. 

The movie theaters Monday drop just continues their 2017 declines. Cinemark is down 8.5% this year, Regal is down 27.98% this year and AMC is down 59.18% this year.

Read more about "Blade Runner 2049's" opening weekend here.

amc stock price

SEE ALSO: 'Blade Runner 2049' wins the weekend box office but shockingly underperforms

Join the conversation about this story »

NOW WATCH: Is bitcoin a bubble or the future of everything?

KEN ROGOFF: Bitcoin will eventually collapse

Business Insider, 1/1/0001 12:00 AM PST

bitcoin

Kenneth Rogoff, the former chief economist of the International Monetary Fund, has weighed in on Bitcoin.

"Is the cryptocurrency Bitcoin the biggest bubble in the world today, or a great investment bet on the cutting edge of new-age financial technology?" the professor of economics and public policy at Harvard asks in a column on Project-Syndicate titled "Crypto-Fool's Gold?"

"My best guess is that in the long run, the technology will thrive, but that the price of Bitcoin will collapse."

Bitcoin's price has exploded over the last two years, and has climbed more than 350% since the start of 2017.

The cryptocurrency's rapid ascent, and the cottage industry that has grown around it, have galvanized investors' interests and elicited their fair share of criticism.

A number of top Wall Streeters have recently have expressed concerns about Bitcoin. JPMorgan CEO Jamie Dimon called it "a fraud" that is "worse than the tulip bulbs," referring the 17th century Dutch tulip-mania bubble. BlackRock Chairman and CEO Larry Fink, meanwhile, told Bloomberg News that "it just identifies how much money laundering there is being done in the world."

Bitcoin and other digital currencies' transactions are done anonymously. They aren't monitored by central banks like, say, the dollar or the euro. In his piece, Rogoff suggests that if Bitcoin was no longer anonymous and more regulated, then its price might not be sustainable.

"Were Bitcoin stripped of its near-anonymity, it would be hard to justify its current price," he wrote. "Perhaps Bitcoin speculators are betting that there will always be a consortium of rogue states allowing anonymous Bitcoin usage, or even state actors such as North Korea that will exploit it."

He added that central banks could also create their own digital currencies and then use regulation to "tilt the playing field until they win."

"The long history of currency tells us that what the private sector innovates, the state eventually regulates and appropriates," he wrote. "I have no idea where Bitcoin’s price will go over the next couple years, but there is no reason to expect virtual currency to avoid a similar fate."

The cryptocurrency was up by 2.5% at 4,718.5098 against the US dollar at 2:44 p.m. ET.

Check out the full article from Rogoff here.

SEE ALSO: Here's what 6 of the most powerful Wall Streeters have to say about bitcoin

Join the conversation about this story »

NOW WATCH: RAY DALIO: You have to bet against the consensus and be right to be successful in the markets

51.1%: Bitcoin Dominates Cryptocurrency Market For First Time Since May

CryptoCoins News, 1/1/0001 12:00 AM PST

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'That should be illegal': Lawmakers are taking aim at pharma giant Allergan over an unusual deal with a Native American tribe (AGN)

Business Insider, 1/1/0001 12:00 AM PST

Brent Saunders

  • In September, Allergan struck an unusual deal with the Saint Regis Mohawk Tribe to transfer patents of the eye drug Restasis, a move that gives the drug sovereign immunity from certain patent challenges. 
  • The goal is to protect the blockbuster drug from generic competition before its patents run out in 2024. 
  • Lawmakers aren't too happy about the deal, and Senator Claire McCaskill has introduced a bill to close the sovereign immunity "loophole." 

Allergan, the drugmaker behind Botox, is using a tricky workaround to protect patents on one of its drugs — and lawmakers aren't exactly happy about it. 

The deal, which passed off the patents for the blockbuster eye drug Restasis to the Saint Regis Mohawk Tribe, is an unusual move that gives the drug sovereign immunity, keeping it from having its patents challenged as the drug starts to face generic competitors. 

The deal has prompted lawmakers to introduce bills that would make such a maneuver illegal, but Allergan's standing by the move, arguing the move helps protect them from "patent trolls" and facing "double jeopardy" when it comes to lawsuits over its patents. 

How the deal came to be

In September, Allergan put out a press release announcing that it had made the deal, calling it a "sophisticated" opportunity. Restasis, the drug in question that's used to treat chronic dry eye, was approved in 2003 and has patents protecting it until 2024. In 2016, the drug made $1.5 billion in sales, making up about 15% of Allergan's profits, according to Reuters. Out of the deal, St. Regis got $13.75 million from Allergan and can receive up to $15 million in annual royalties.

Native American tribes, along with institutions like universities, have sovereign immunity that protects patents from certain challenges to their validity. 

The tribe, in the Allergan press release, said it viewed the agreement as a way to diversify its income.

"We realize that we cannot depend solely on casino revenues and, in order for us to be self-reliant, we must enter into diverse business sectors to address the chronically unmet needs of the Akwesasne community; such as housing, employment, education, healthcare, cultural and language preservation," the tribe's council said in the release. 

Dale White, general counsel for the tribe, told CNBC's Meg Tirrell in September that he'd be interested in doing similar deals, asking Tirrell if she would put his phone number in an article. 

But outside the two parties involved in the deal, the move almost immediately sparked a negative reaction. "Anyone who cares about drug pricing should be very, very concerned about the potential impact of Allergan’s actions here," Rachel Sachs, a professor of law at Washington University in St. Louis wrote in a blog post.

Protecting exclusivity

Generic competition to branded drugs like Restasis can get on the market easier thanks to a law from 1984 known as the Hatch-Waxman Act, which gives the generic drugmakers a shorter process leading up to an FDA approval than a first-of-its-kind branded drug might experience. This helped get more generic drugs on the market and drove the prices for prescription drugs down.

The act also set up a way for branded drugmakers to have a certain period of exclusivity where their drug was the only one on the market. During that time, drugmakers can recoup the investment they made in developing the drug. Once a drug goes off patent and generics come on the market, the price of the drug dramatically drops.

The timelines for this market exclusivity aren't set in stone, though. Generic drugmakers are able to challenge the validity of the branded drugmaker's patents, through both the Hatch-Waxman Act and a newer law called the America Invents Act. For example, Allergan is waiting for a ruling on a court case on Restasis underway in Texas, which could lead to generic competition sooner than 2024. In that case, however, the tribe has waived its sovereign immunity. 

What Allergan is trying to avoid is a procedure that lets parties challenge the validity of patents called inter partes review that's part of the America Invents Act, which could also invalidate the Restasis patents. Allergan's CEO Brent Saunders referred to this process as "double jeopardy" in a Wall Street Journal opinion piece. The deal with St. Regis grants Allergan sovereign immunity over the IPR process.

In September, Senators Maggie Hassan, Bob Casey, Sherrod Brown, and Richard Blumenthal in a letter asked for Senators Chuck Grassley and Dianne Feinstein of the judiciary committee to investigate Allergan's  "anti-competitive attempt to shield its patents from review and keep drug prices high." 

Saunders disagreed with that characterization in a letter to Grassley and Feinstein: 

"The opposite is true. Allergan is committed to vigorously defending the intellectual property that protects its products and has recently completed a Hatch-Waxman trial in a Federal District Court in Texas which includes attacks on the validity of the patents covering Restasis, and a ruling is anticipated in the near future. To be clear, if the District Court ruling is adverse to Allergan’s patent position, and there is an FDA approval of a generic version of Restasis, that product could enter the market many years in advance of the listed patent expiry dates."

claire mccaskill

Closing a 'loophole'

In the month since Allergan announced the deal, members of Congress have spoken out against it.  

Representatives Trey Gowdy,  Elijah Cummings, Dennis Ross, and Peter Welch sent a letter to Saunders on October 3, asking for more information about the deal. Saunders has until October 17 to respond.

"The implications of Allergan's patent transfer raise questions for Congress as the exchange may impair competition across the pharmaceutical industry and ultimately dissuade companies from pursuing less-costly generic alternatives to brand drugs," the congressmen wrote in the letter. 

And on October 5, Senator Claire McCaskill introduced a bill aimed at closing the sovereignty "loophole."

"If this drug company thinks I’ll just sit by and watch, while they brazenly exploit loopholes to protect their profits and make Missourians pay more in the process, they obviously don’t know me very well," McCaskill said in a statement. "Any thinking person would look at what this company did and say, 'That should be illegal.' Well, I agree. Congress never imagined tribes would allow themselves to be used by pharmaceutical companies to avoid challenges to patents, and this bill will shut the practice down before others follow suit."

But Allergan's standing by its plan. 

"We at Allergan fully support generic competition for our medicines. Hatch-Waxman has created an effective balance between investment in innovation and the need to ensure affordable access to medicines," Saunders said in The Journal. "What we cannot support, however, is a system that creates an unfair burden on owners of intellectual property, while empowering hedge funds and patent trolls."

SEE ALSO: A congressman just hit out at Trump, tweeting 'companies are charging $87k/yr for a drug YOU own'

DON'T MISS: 'Nobody's talking about' 2 medical conditions that affect 8 million women in America — but that could be about to change

Join the conversation about this story »

NOW WATCH: RAY DALIO: Bitcoin is a speculative bubble

Walmart is spiking after announcing a tech-savvy return policy (WMT)

Business Insider, 1/1/0001 12:00 AM PST

People line up at a Walmart store that reopened Friday after Tropical Storm Harvey in Port Arthur, Texas, U.S., September 1, 2017. REUTERS/Carlo Allegri

Shares of Walmart are up 2.71% at $81.20 on Monday following the announcement that the company will begin offering a tech-savvy way for customers to return purchases.

In November, Walmart will begin allowing customers to return items they purchased through Walmart.com to physical stores with the help of an app. The app will allow customers to enter all the necessary information about the return before heading to the store, where a Walmart employee will finish the process in about 30 seconds, according to the company.

Walmart is calling its new service "Mobile Express Returns."

The move is an important step in the company's battle over the future of retail. Walmart is leveraging its massive brick-and-mortar footprint to make returning unwanted items less of a hassle for consumers. Instead of finding a box, packing an item securely, attaching a return label and dropping the item at a Post Office, a customer just has to return the item to one of Walmart's 4,700 stores. It's estimated that 90% of Americans live within 10 miles of a Walmart, which is the key advantage of the program.

Walmart has been ramping up it e-commerce efforts lately. The company now offers in-store pickup for online orders as well as free two-day shipping for many online purchases in an effort to take on Amazon. At the same time, Amazon has been working its way into traditional retail, most notably with its $13.7 billion purchase of Whole Foods.

Walmart is up 18.14% in 2017, bucking the general decline that has hit many retailers this year.

Read more about Walmart's new Mobile Express Returns here...

walmart stock price

SEE ALSO: Walmart just proved it has a huge advantage over Amazon

Join the conversation about this story »

NOW WATCH: THE BOTTOM LINE: The 'Trump trade' is back and Ray Dalio breaks down the bitcoin bubble

MACQUARIE: Central banks have tricked investors and created a 'doomsday machine'

Business Insider, 1/1/0001 12:00 AM PST

machine france spider robot

This may not end well. 

There's an unprecedented level of calm across the markets, whether it's measured by the low volatility in US stocks or G7 currencies. Economies across the world are growing steadily, and interest rates are still historically low — a desirable combo some strategists like to call "Goldilocks." 

Major credit for that apparent stability goes to central banks and their several years of low interest rates and large bond purchases, according to Macquarie's Viktor Shvets and Chetan Seth.

However, that also means any policy mistake could undo their efforts and shake up the global economy. They've created "what is essentially a long-term 'doomsday' machine," Shvets said in a note on Monday.

"We remain constructive on financial assets (both equities and bonds), not because we expect a return to self-sustaining private sector led recovery and growth but because we believe that an ongoing financialization is the only politically and socially acceptable answer," Shvets wrote. "In our view, therefore, the greatest risk is one of policy miscalculation."  

The reflation trade in US stocks was jolted after the election, when Wall Street bet that the Fed would get a helping hand from fiscal policy and tax cuts. With that, economic growth and inflation were expected to pick up. But fumbles over healthcare reform showed that this could take longer than expected. 

Even if there's eventually implementation, Shvets doesn't see any resulting economic growth as a result of higher consumption and business spending. 

"Unfortunately, we do not see evidence that velocity of money is improving and neither are there signs that sectoral balances are moving towards sustainably higher private spending while core inflationary pulse remains weak," Shvets wrote.

"We continue to view China’s leveraging and CBs’ injections of liquidity and suppression of volatilities as the key drivers of global reflation. We also maintain that it is unlikely that the Trump administration policies will lead to any sustained gain in either consumption, investment or current-account deficits."

In short, the slightest mistake by central banks or China could be disastrous. 

SEE ALSO: The stock market just flashed a dangerous warning signal

Join the conversation about this story »

NOW WATCH: THE BOTTOM LINE: The 'Trump trade' is back and Ray Dalio breaks down the bitcoin bubble

Investing in Bitcoin is Like Betting on Internet Companies in 90s, Says Fmr. Goldman Sachs VP

CryptoCoins News, 1/1/0001 12:00 AM PST

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What you need to know on Wall Street today

Business Insider, 1/1/0001 12:00 AM PST

Welcome to Finance Insider, Business Insider's summary of the top stories of the past 24 hours. Sign up here to get the best of Business Insider delivered direct to your inbox.

For months, stock market pessimists have been saying US equities are overvalued. And as of this past week, they have a major piece of tangible evidence.

The measure in question is the so-called relative strength indicator, which indicates when the stock market has gotten too stretched in either direction. An RSI measure exceeding 70 means the market is overbought and a downturn may be imminent. A drop below 30 indicates an oversold condition.

The RSI for the benchmark S&P 500 climbed above 70 last week and stayed in that overvalued territory for five straight days. The index's repeated climb to record highs is now in danger — at least if the past 12 months is any indication.

Economist Richard Thaler has been awarded the 2017 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, often considered to be the most prestigious prize in the field of economics. In addition to his day job as an economist, Thaler once had a cameo appearance in the film "The Big Short," next to pop star Selena Gomez.

Elsewhere in economics news, Amazon might be lowering the rate of inflation globally. And a report co-authored by a People's Bank of China researcher says China's economy is about to hit a wall.

In crypto news, a former Goldman Sachs VP who founded a crypto hedge fund says betting on bitcoin is like betting on the internet in the 90s. And hackers broke into Amazon's cloud to mine bitcoin.

In markets news and views:

Lastly, meet the 30 biotech leaders under 40 who are searching for breakthrough treatments and shaping the future of medicine.

Join the conversation about this story »

NOW WATCH: RAY DALIO: Bitcoin is a speculative bubble

Interview: Cryptographer Silvio Micali on Bitcoin, Ethereum and Proof of Stake

Bitcoin Magazine, 1/1/0001 12:00 AM PST

Interview: Cryptographer Silvio Micali on Bitcoin, Ethereum and Proof of Stake

Silvio Micali is an MIT professor and Turing Award–winning cryptographer known for his work in technologies that form the bedrock of blockchains today: public-key cryptosystems, digital signatures, pseudorandomness and multiparty computations. He is also the co-inventor of the zero-knowledge proof.

In the ’90s, he worked on Byzantine agreement, a protocol for getting nodes in a distributed system to agree on a state change. And in 2012, he and long-time collaborator Shafi Goldwasser were co-recipients of the A.M. Turing Award, essentially, the “Nobel Prize in computing.”

Upon learning about Bitcoin three years ago, Micali turned his attention from mechanism design, which had consumed him for the previous seven years, and dove headlong into creating a proof-of-stake algorithm. His project is called Algorand.

Put simply, Algorand relies on a novel form of Byzantine agreement with only nine expected steps. In each step, committee members, chosen at random in a private lottery, are replaced. The result is a high-security system with a negligible risk of forks.

According to Micali, recent tests show Algorand can process 2 MB blocks in 17 seconds, compared to Bitcoin, which produces a 1 MB block every 10 minutes. (A paper on these results will be presented at SOSP, the biennial ACM Symposium on Operating Systems Principles, later this month.)

In an interview with Bitcoin Magazine, Micali explained why he thinks proof of stake is superior to proof of work, the consensus algorithm that underlies most cryptocurrencies today, including Bitcoin and Ethereum. Although Ethereum, more often viewed as a smart contract platform, aims to transition to proof of stake next year.

Unnecessary Evil

Micali thinks proof of work was a great idea when it first came out, but now that we have seen the consequences, he calls it an “unnecessary evil” for several reasons.

“The first time I heard about Bitcoin, I saw all the difficulties. To me, the main difficulty is the waste of computational resources. That is really appalling,” he said. “It drives up prices and depletes the planet of resources.”

Second, he sees miners as “a new center of power” and an orthogonal force to the real users of the system: the coin holders.

“If five mining pools can control what goes in or does not go in a block, in what sense is the ledger decentralized? You don’t want miners having control over the ledger, particularly when they have low margins, are far away and accountable to no one. I think it is a recipe for disaster,” he said.

Finally, transaction ambiguity does not sit well with him. In Bitcoin, occasionally two blocks are found at roughly the same time, creating a temporary fork in the chain. When that happens, the branch with the greater hash power is elongated, while the other and its blocks “disappear.” If your transactions happened to be in an orphaned block, it will eventually get picked up again in the main chain, but for Micali, the idea is unsettling.

“Every time I see my transaction is in a block, I worry the block may disappear. But never mind anxious people like me; banks may not be willing to take on the additional risk,” he said. “Can you imagine a financial world where wire transfers could be taken back?”  

Natural Democracy

Micali thinks proof of stake is a better option. In proof of stake, there are no miners, just the coin holders. Further, a coin holder’s ability to create or validate a block is based on how many coins in the system he or she owns.

“This is a natural interpretation of democracy,” Micali said. “Your influence in maintaining the integrity of the system is based on how much you are really invested in the system.”  

But there is a catch: creating a proof-of-stake algorithm is hard to do. While several projects claim to have come up with a secure protocol, Micali thinks some of those claims are questionable. “The fact is, people can claim anything they want,” he said.

One of the biggest challenges in proof of stake is the “nothing at stake” problem. If the chain forks, the optimal strategy for any coin holder is to extend both chains to earn additional block rewards or to double spend. That goes against the central design goal of all blockchains: getting users to converge on a single chain.

Some projects are looking at ways to sculpt their proof-of-stake protocols by adding perks or punishments to get coin holders to abide by the rules. As part of that, some proof-of-stake systems require users to put up a type of security deposit or bond.

Micali feels a well-designed proof-of-stake cryptocurrency should stand on its own, however, without extra measures. He thinks bonding opens doors to bad actors.

“Let me ask you, what fraction of your disposable income can you put on the table and not touch?” he said and suggested that honest people will put up only a small amount, ceding control to bad actors with big pockets.

“The danger is that only bad people will give up control over a large amount of money to manipulate the system. And if they earn much more money by misbehaving, they will be happy to lose what they put on the table,” he said.

He also disagrees with the idea of using punishment to get users to fall in line.

“A weak state rules through threats and fear,” he said, comparing the practice to barbaric punishments used by some nations to fight crime. Why do they do it? Because criminals are so rarely caught, he said. “So once they catch one, they disembowel the poor guy.”

He continued, “Do you want to oust somebody who misbehaves? Of course. But a well organized system is one in which you don’t need to punish people.”

Bitcoin and Ethereum

Most people view Bitcoin solely as a cryptocurrency, but Micali thinks the greatest value of Bitcoin and Ethereum are as enablers of smart contracts, in which users can stipulate if-then conditions around payments.  

“At the end of the day, doing only payments is easy,” he said, adding that he did not want to trivialize the problem. “Of course, decentralized payments are better than centralized payments, but what really differentiates a cryptocurrency from any other form of money is that you can actually do a smart contract.”

Based on that, he thinks that both Bitcoin and Ethereum would benefit from implementing the best consensus algorithm available. Currently, both systems are “huffing and puffing,” he said. Bitcoin is constrained to 7 transactions per second, while Ethereum can process only 15 per second, compared to Visa’s 2,000 per second.

“If the blockchain scales, isn’t it better for Bitcoin and Ethereum? If the blockchain has a [mathematical] proof of security, isn’t it better for its users?” he said. “If the blockchain cannot be hijacked by miners who are accountable to nobody and live in some faraway jurisdiction, isn’t that a plus for all users?” Micali thinks so.


The post Interview: Cryptographer Silvio Micali on Bitcoin, Ethereum and Proof of Stake appeared first on Bitcoin Magazine.

Bitcoin Price Surpasses $4,620, Analysts Optimistic in Strong Rally Toward $6,000

CryptoCoins News, 1/1/0001 12:00 AM PST

[…]

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(+) Technical Analysis: Ripple and Bitcoin Rise More as BTC Dominance is Back

CryptoCoins News, 1/1/0001 12:00 AM PST

[…]

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(+) Technical Analysis: Ripple and Bitcoin Rise More as BTC Dominance is Back

CryptoCoins News, 1/1/0001 12:00 AM PST

[…]

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GE is sliding after an activist investor lands a board seat (GE)

Business Insider, 1/1/0001 12:00 AM PST

General Electric Co's incoming chief executive John Flannery is shown in this undated handout photo provided June 12, 2107.  Courtesy General Electric/Handout via REUTERS

General Electric's new CEO is making it clear who is in charge now.

John Flannery, GE's new CEO and chairman of the board, approved a new activist shareholder to the board just days after a chief financial officer shakeup, Bloomberg reports. The company's stock is down about 3% on Monday after the news.

On Monday, Flannery named Ed Garden, a founding partner of activist investing firm Trian Fund Management, to GE's board of directors, according to a report from Rick Clough of Bloomberg.

The move continues a series of steps Flannery has taken in a shakeup of the company's top executives. Just three days prior to the board seat approval, Flannery welcomed Jamie Miller to the CFO position from his previous place at the head of the company's transportation division.

Beth Comstock and John Rice, both vice chairs of GE, were also reported to be leaving their positions.

Flannery is on a path to turn around this year's biggest loser on the Dow Jones Industrial Average through these shakeups. Bloomberg reported that Flannery is hoping to make big changes to the company's diverse portfolio, and is open to a dividend cut.

Toward that goal, the company recently offloaded its industrials unit for $2.6 billion, and shares initially jumped after the announcement of Flannery's rise to CEO.

GE has fallen 25.47% this year.

Read the full Bloomberg story here

ge stock price

Join the conversation about this story »

NOW WATCH: THE BOTTOM LINE: The 'Trump trade' is back and Ray Dalio breaks down the bitcoin bubble

Wall Street is bullish heading into the most important time of the year for stocks

Business Insider, 1/1/0001 12:00 AM PST

bull

Banks across Wall Street can agree on at least one thing right now: that the upcoming earnings season will be strong.

As for the reasons why — that's where it gets a little most complicated.

Let's start with Goldman Sachs, which predicts that bullish expectations around corporate tax reform will provide a backstop for equity appreciation. And the market may just need an external catalyst, since the firm expects S&P 500 earnings to grow only 5% this quarter, down from the double-digit expansion seen in the first two quarters of the year.

The impact of the catastrophic hurricane activity that hit the US during the reporting period will also give investors a higher tolerance for a profit growth slowdown, which could be viewed as temporary, Goldman said.

"We expect investors will ignore the EPS slowdown given one-time hurricane effects and the focus on benefits from corporate tax reform," a group of the firm's strategists led by David Kostin wrote in a client report, noting that optimism around tax measures was crucial in the S&P 500's ascent to new records last week.

Morgan Stanley is similarly optimistic — but their stance stems more from what they view as an underpricing of earnings results. While the firm readily admits that this may be a result of companies keeping forecasts low so they can more easily beat them, it also notes that earnings outperformance does tend to drive share gains.

However, Morgan Stanley thinks investors have caught on to this financial engineering technique, and have already started bidding up stocks in anticipation of easy earnings beats.

"Stocks correctly recognized this low bar a few weeks ago and have rallied sharply into earnings season," strategists led by Michael J. Wilson wrote in a client note. It's been a "familiar pattern this year."

The firm also highlights the continued upward trend for S&P 500 12-month forward earnings, as shown in the chart below:

Screen Shot 2017 10 09 at 11.05.09 AM

Bank of America Merrill Lynch shares Morgan Stanley's view that traders have already keyed in on what they see as a better-than-expected earnings season. While the firm says that "a good 3Q is priced in," it recognizes that there could be further gains if companies provide positive forward guidance.

"Corporate optimism based on guidance is near 7-year highs," BAML strategists led by Savita Subramanian said in a note to clients. "A continuation of these trends may be key to market strength."

BAML also highlights a weak US dollar as boosting the profitability of multinational corporations, many of which have large weightings in major equity indexes. An index tracking the greenback versus other currencies has fallen 8.3% in 2017.

These types of forecasts are starting to accelerate, with earnings season set to kick off in earnest this week. Financials will get the proceedings going on Thursday, with JPMorgan and Citigroup due to report results. Then Wells Fargo and Bank of America are scheduled to announce earnings on Friday.

So the question now becomes — how do these earnings forecasts translate to year-end expectations on the S&P 500?

Interestingly enough, even though Goldman sees tax reform propping up the benchmark during this reporting period, its 2017 forecast calls for the S&P 500 to fall roughly 6% to 2,400. Meanwhile, BAML sees a more measured drop to 2,450 by the end of 2017.

It must be noted that neither firm thinks that third-quarter earnings season will be responsible for the consolidation into the end of 2017. As outlined above, they're constructive — if not outright bullish — on the period.

It's actually Morgan Stanley that's carrying the bullish flag for the stock market, expecting the gauge to climb to 2,700 by the end of first quarter 2018 — the most bullish target on Wall Street.

Screen Shot 2017 10 09 at 11.24.31 AM

SEE ALSO: The stock market just flashed a dangerous warning signal

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A report co-authored by a People's Bank of China researcher says China's economy is about to hit a wall

Business Insider, 1/1/0001 12:00 AM PST

china manufacturingChina’s economy may soon start feeling some negative payback for stimulus policies that have helped growth to rebound but at the cost of rising corporate debt levels, according to a new paper from the Federal Reserve Bank of Kansas City.

The report's findings are particularly striking given the co-author comes from China's own central bank, which tends to be fairly mum on potential economic vulnerabilities there.

"Our analysis indicates that the momentum of Chinese growth is likely to slow in the near term," write Jun Nie, senior economist at the Kansas City Fed, alongside Yandong Jia, a researcher at the Research Bureau of the People’s Bank of China.

The latest round of figures have painted a bright outlook for the world’s second largest economy. China’s gross domestic product expanded at a 6.9% annual pace according to official figures, while manufacturing and services surveys also pointed to renewed strength.

But the Kansas City Fed report suggests the new growth spurt may be more mirage than miracle. 

"An analysis of its underlying forces suggests this momentum may not be sustainable," the authors write. "In addition, strength in policy-related variables has been waning, creating additional downside risks to near-term growth."

In other words, the government’s heavy handed role in sustaining a recovery in sectors that don’t particularly need them, like steel, mining and construction, has ultimately been economically unproductive.

"As China is transitioning from an investment- and export-driven economy to a more consumption-driven economy, the recent improvement in the manufacturing, investment, and trade group is likely to be temporary," the Kansas City Fed study said.

Other driving forces that may also prove fleeting include an export-boosting depreciation of the Chinese yuan at the end of last year and a rebound in global commodity prices and production, the report said.

Another telling admission for a People's Bank of China researcher: the official data is too opaque to allow for useful forecasting.  

"China’s official quarterly GDP figures have been criticized for being overly smooth and less informative," the report says. "Moreover, Chinese government policies have stimulated or cooled the economy at different times, further muddling the signal from economic data. To better assess whether the recent uptick in growth is sustainable, we use a factor analysis of monthly measures of Chinese economic and policy activity in key sectors."

SEE ALSO: China's economic stability comes with hidden costs

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BARCLAYS: We’re still waiting on Tesla’s 'iPhone moment' (TSLA)

Business Insider, 1/1/0001 12:00 AM PST

elon musk

Delayed Model 3 deliveries and a behind schedule electric semi truck have pushed shares of Tesla down almost 9% since the middle of September.

That drop, coupled with other hiccups in September, has already netted short sellers a cool $160 million — and there could be more opportunity for traders to bet against the stock, according to Barclays.

In a note to clients Monday, the investment bank said hype around Tesla’s Semi "is at least a short-term trading opportunity to ride Tesla down," and that any possible "iPhone moment" investors were waiting for "appears less certain."

"With the hype cycle around Tesla Semi delayed for another month, we expect the stock to come under pressure in the short term, while looking for any larger break in investor confidence that could lead the shares closer to our $210 price target," said analyst Brian Johnson in a note.

Bloomberg data shows his $210 price target for Tesla shares is well below the Wall Street consensus of $340, and that he is one of the most bearish analysts surveyed.

The true test of Tesla’s stock price will occur in the coming weeks, before the company's November 19 big-rig announcement, when a middle segment of investors — coined "purple pillers” by the bank — may lose confidence and be swayed to the bear side. 

"Purple pillers are a more realistic crowd – and generally don’t believe the blue-sky Tesla scenarios proposed by blue pillers (in which Tesla will sell several million units a year, while also leading in other business opportunities – e.g. battery storage)," Johnson wrote. "However, they recognize that Tesla stock is driven by a substantial number of uber-bull investors who believe in these scenarios."

"So when faced with challenges to the veracity of the ramp - often encapsulated in tweets, as opposed to the more conservatively written and compliance/legal friendly versions of the quarterly shareholder letters - there could be some loss in confidence," Johnson says. 

Despite the brief drops, shares of Tesla have gained 74% over the last year. 

Tesla stock price chart

SEE ALSO: Traders betting against Tesla are finally making millions

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RBC: Disney's new streaming service could be absolutely massive (DIS)

Business Insider, 1/1/0001 12:00 AM PST

disney park

In the last five years, more than 700 million people visited a Disney park. According to Steven Cahall, an analyst at RBC Capital Markets, that massive number could give investors an idea of the potential size of Disney's soon-to-be streaming service.

Cahall thinks that the massive fan base that Disney has grown over the years will translate into several million subscribers when the company launches its movie and TV streaming service in 2019.

Disney announced earlier this year that it would be pulling many of its movies and television shows off of partner platforms like Netflix in order to start its own streaming service. Disney's move is part of a recent trend of content producers siloing their content behind their own paywalls to better monetize their content. CBS recently pulled most of its highly-anticipated "Star Trek: Discovery" series behind a paywall, in another example.

Cahall said that the streaming service could have 5 million subscribers in 2020 if it is priced similarly to its competition. But, if the service is priced to grow quickly, 20 million subscribers is not out of the question.

For comparison, Netflix started its streaming business in 2007 and has grown it to 51.92 million subscribers in the US over the last decade. It has another 52 million international subscribers.

20 million subscribers could be the number that also changes how investors view the company, Cahall said. Disney currently trades at about 10 times its earnings, but its media peer group is traded at a much higher multiple. Seeing a huge subscriber number would force investors to weight Disney's media business more heavily, which could send the stock higher.

Because of his expectations for the success of Disney's upcoming streaming service, Cahall rates Disney as one of his top stock picks. Cahall has a price target of $125 for the stock.

Disney is currently trading around $100.81 and is down 4.92% this year. Disney did rise about 0.79% on Monday after Cahall's report, though.

To read more about how investors went rabid over Netflix's recent price hike, click here.

disney stock price

SEE ALSO: Netflix is popping after reports of rising subscription prices

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The winner of this year's Nobel Prize in economics had a cameo next to Selena Gomez in 'The Big Short'

Business Insider, 1/1/0001 12:00 AM PST

Economist Richard Thaler was awarded the 2017 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel for his contributions to behavioral economics on Monday.

It's generally considered to be the most prestigious prize for the field of economics.

In addition to his day job as an economist, Thaler once had a cameo appearance in the film "The Big Short," next to pop star Selena Gomez.

In the scene, Gomez explains the concept of the "hot hand fallacy," a key behavioral feature that drove the rise of synthetic collateralised debt obligations — one of the key drivers of the US subprime mortgage crisis in 2007.

"The Big Short" movie is based on Michael Lewis' book "The Big Short: Inside the Doomsday Machine" on the 2007-2008 financial crisis. 

You can watch the scene in clip below starting around the 3:31 minute mark, courtesty of Youtube.

SEE ALSO: Meanwhile, former Fed chair Ben Bernanke was on 'The Big Bang Theory' a while back

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China’s ICO Ban Puts GigaWatt In Unique Territory

Bitcoin Magazine, 1/1/0001 12:00 AM PST

chess header


China has long been a dominant player on the global Bitcoin map. By 2016 over 90% of Bitcoin’s global trading volume took place there. Moreover, mining operations were in abundance due to China’s cheap electricity. It is no coincidence that Bitmain, the world’s largest Bitcoin mining equipment manufacturer, is a Chinese company.


While China still dominates crypto mining and mining equipment manufacturing, the country’s Bitcoin trading volume has fallen. When regulations led to bans on no-fee trading and restrictions on Chinese Bitcoin exchanges in early 2017, Bitcoin trading volumes in China plummeted. Bitcoin trading activity diverted to countries like Japan.

 

At the beginning of September, China issued a ban on Initial Coin Offerings (ICOs), an unregulated cryptocurrency-based crowdfunding practice that attract capital for new startup companies and projects. This regulatory act sent shock waves through the global Bitcoin community.  

 

As part of the ban, authorities requested that ICO participants be refunded for their contributions. Moreover, the People’s Bank of China and China’s central bank demanded that Bitcoin exchanges be closed.


Mining Resilience 

 

As an emerging presence in the global crypto-mining industry, U.S.-based mining solution provider, Giga Watt, stands in unique territory given theses recent developments. Located in America’s Pacific Northwest—in close proximity to a number of power-producing hydroelectric dams—the Giga Watt Project is proving to be North America’s new major crypto mining player.


The Giga Watt Project’s founder and CEO, Dave Carlson, has little concern over China’s ICO ban: “I don't see the ban having a large impact on Bitcoin. I'm not convinced that ICOs are inherently linked to the ecosystem.”


While Carlson believes that Chinese authorities still see value in the rapid growth of cryptocurrency, he thinks that this value has been trumped by their will for regulatory control. However, China’s regulatory developments haven’t affected the the Giga Watt Project’s strategic direction. “Because there are many other blockchain processing opportunities outside of Bitcoin, it’s not even a blip on our radar,” noted Carlson. He added, “Personally, I predict that ICOs will return to China, but only on their terms.”


In the meantime, Carlson will continue to lead the Giga Watt Project’s aim of building a mining network unlike anything before it. Currently, the project has three operating units, with 2.25 megawatts ready for tokenization. In addition, three of Giga Watt’s state-of-the-art Giga Pods are now complete. Access to Giga Watt services will be allocated to token holders on a first come, first served basis.


Blockchain-based Computing


A key takeaway in Carlson’s response to China’s ICO ban is what he envisions for the future. Bitcoin mining will likely pale in comparison to new forms of blockchain-based computing methods, and Carlson sees this as one way the industry will mature and stabilize. “As Bitcoin's value rises, the ability for miners to drive difficulty by adding hashpower becomes harder and harder as much more computing is required.” In this matured industry, Carlson anticipates that Bitcoin’s blockchain will be leveraged, pointing to RSK's smart contract as an example. “I am hopeful that blockchain-based computing will boost revenue and provide new opportunities.”

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Turkish markets are getting slammed after the US and Turkey suspend visa services

Business Insider, 1/1/0001 12:00 AM PST

turkey erdogan

  • Turkey and the US suspended visa services between the two countries.
  • The visa suspensions exacerbate the already worsening relations between the two NATO members, and could hurt Turkey's economy.
  • Turkish markets got slammed after news of the suspensions crossed the wires.

Turkish markets are getting slammed after the US and Turkey suspended visa services between the two countries, exacerbating already deteriorating relations.

The Turkish lira fell by as much as 6.6% against the US dollar to a fresh record low, but has since reversed some of those losses. It was down by about 2.9% at 3.7196 per dollar at 8:35 a.m. ET.

The country's benchmark Borsa Istanbul 100 Index fell by about 3.3%, and Turkish Airlines dropped by about 8%.

The US embassy in Ankara, the capital of Turkey, said on October 8 that it had suspended all non-immigrant visa services. This means that Turkish citizens can no longer get visas for business, tourism, or education, but people permanently moving to the US can still apply.

us dollar turkish liraWithin hours, the Turkish embassy in the US said it would be suspending "all visa services." Reuters reported that later on Monday the Turkish foreign ministry "summoned a US diplomat to urge the United States to lift the visa suspension, saying it was causing 'unnecessary tensions.'"

The US embassy's decision to suspend visas followed Turkey's recent arrest of a US embassy employee over suspected links to US-based cleric Fethullah Gulen, who was blamed by the Turkish government for the failed military coup in July 2016. In its statement, the US embassy said "recent events have forced the United States Government to reassess the commitment of the Government of Turkey to the security of US Mission facilities and personnel."

"This latest incident marks a further deterioration in relations between Washington and Ankara, which are arguably now at their nadir," analysts at BMI Research said in a note to clients.

"Turkish-US relations are likely to remain icy over the coming quarters," they continued. "In a wider context, this latest incident suggest that Turkey will continue its general drift away from traditional Western partners, with diplomatic spats also erupting with several European countries, including Germany, in recent months."

According to Bloomberg's Tugce Ozsoy and Selcan Hacaoglu, the visa ban puts Turkey "in the same boat" as Chad, Iran, Libya, North Korea, Syria, Venezuela, and Yemen, which have had US travel restrictions levied on them.

"Turkey, which has been in the western camp since the 1940s, is lumped together with these countries?" Murat Yurtbilir, who specializes in Turkish affairs at the Australian National University, told Bloomberg. "This is the lowest level in Turkish-U.S. relations."

Should the visa ban stay in place, Turkey's tourism sector likely won't get slammed, since US tourists made up less than 2% of foreign visitors in 2016. The banking and financial sectors, however, could take a hit. As the analysts at BMI Research explained:

"[A] worsening of relations between the US and Turkey may weigh on the willingness of US and other Western banks to continue financing Turkish counterparts, especially in the context of a less supportive global backdrop as developed state interest rates rise. Cross-border bank lending is crucial not only for the Turkish banking sector, which is dependent on external financing, but more broadly for the financing of Turkey's sizeable current account deficit and thus macroeconomic stability."

A weaker lira could also weigh on the Turkish economy, according to the analysts.

"The scale of the [lira's] depreciation is similar to the July 2016 sell-off after the attempted military coup," Murat Toprak and Dominic Bunning of HSBC said in a note to clients Monday.

"[W]e believe the political risk is very different in nature compared to that episode and think this depreciation looks excessive. But we believe the risk of a downward spiral in [lira] cannot be ruled out – this will depend on diplomatic developments."

Worsening relations

Relations between Turkey and the US — both NATO members — have deteriorated in recent months over the US' military support for Kurdish groups in Syria and Turkey's cooperation with Russia and Iran in Syria. Other points of tension have included the US' refusal of Turkey's request to extradite Gulen, who denies involvement in the attempted coup and the indictment of Turkey's former economy minister by a US court last month.

In May, members of Turkish President Recep Tayyip Erdogan's security detail attacked protestors in Washington, about a mile from the White House.

Tensions have also recently flared up between Turkey and another NATO member, Germany. According to the BBC, "several" German nationals remain in custody in Turkey, and Germany has warned its people against traveling there. Meanwhile, Turkey has asked Germany to deport Turkish citizens who have claimed asylum there.

US President Donald Trump, meanwhile, praised the leadership of Erdogan at the United Nations in New York last month. He added that the Turkish president "has become a friend of mine."

SEE ALSO: North Korea exports $2.83 billion worth of goods — here's where it all goes

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GOLDMAN SACHS: Gold got rejected at a key level and could be setting up for a big drop

Business Insider, 1/1/0001 12:00 AM PST

Gold has had a solid 2017, but Goldman Sachs says its looks like things could be about to change.

The yellow metal has raced to a gain of more than 10% so far this year as the US dollar has stumbled amid President Donald Trump's inability to deliver on campaign proposals like repealing and replacing Obamacare, slashing taxes, and infrastructure spending. Increased political tensions with North Korea have also provided support for the safe haven. But, the charts suggest the trend is changing.

Goldman's technical analysis team of Sheba Jafari and Jack Abramovitz note that gold's test of the key level $1,377/$1,380 level was thwarted and that it's an "important place to watch for reversal" as it "included the previous high from Jul. 16, 38.2% of the entire downtrend from ’11 as well as an equality target from Dec. 16."

Gold

As for how far the precious metal can fall from here, Goldman says we could see a retest of the late 2016 lows near $1,100, which would make for a drop of more than 13% from current levels. 

"It’s now likely in the C wave of an ABC (or ABCDE) pattern since Jul. ‘16," the Goldman team writes. "If true, it’s on track to forming another three wave decline which at very least comes close to testing the previous lows from Dec. ’16 at 1,123. It could extend as far as 1,105; but shouldn’t run much further than there (given the corrective nature of the setup)."

The one thing that gold bulls have going for them is that it appears the late 2015/early 2016 lows look like they will hold. 

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On the Rebound? Ripple's XRP Price Jumps to 7-Week High

CoinDesk, 1/1/0001 12:00 AM PST

Ripple's native cryptocurrency XRP surprised observers with a jump to a near seven-week high of $0.28 yesterday.

Bitcoin Price Breaks Toward $4,600 as Ethereum, Altcoins Lag Behind

CryptoCoins News, 1/1/0001 12:00 AM PST

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Bitcoin Price Breaks Toward $4,600 as Ethereum, Altcoins Lag Behind

CryptoCoins News, 1/1/0001 12:00 AM PST

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Newsflash: Bitcoin Price Hits 30-Day High Near $4,650

CryptoCoins News, 1/1/0001 12:00 AM PST

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Here's a super-quick guide to what traders are talking about right now

Business Insider, 1/1/0001 12:00 AM PST

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S. September 22, 2016.  REUTERS/Brendan McDermid

Dave Lutz, head of ETFs at JonesTrading, has an overview of today's markets.

Here's Lutz:

Morning!  US Futures are climbing, led by a 30bp pop in Nasdaq.  It’s a quiet one out there, as Columbus Day Holiday has US Bond Markets closed, while Holidays elsewhere close Canada, Japan, South Korea and Taiwan.  Europe is drifting around unch, as gains in Tech are mitigated as EU Fins are red despite solid “Stress Test” results.  Airlines are weak as Airbus hit on Friday’sCEO warning – while FTSE is down 30bp as Miners get hit - IBEX is up 70bp as Catalonia angst recedes, but volumes across the continent are posting 30%+ light on average.   Quiet in Asia, as Shanghai sees a modest 70bp rise as they return from week-long Holiday, and Aussie up 50bp as Banks continue to rebound

Treasury Yields are off a touch (Watch TYA today), and the Fed Funds are at 87% for December ahead of FOMC Minutes and Inflation data this week.  The Dollar is retracing gains as Sterling back over $1.31 on chatter May to reshuffle cabinet and Euro higher as German industrial production “smashed expectations”.  That said, the Turkish Lira down 2%, paring 6% losses as USA suspended the processing of new visas in Turkey, while the Kiwi$ is hit on election angst.   Ore was hit for 4% as “China's Return Puts Focus on Winter Curbs”, but Copper only giving back small of last week’s 3% pop – while Gold is showing some life as we await a test tonight from North Korea.   WTI is higher, despite Brent getting hit for 30bp and Gasoline stateside falling nearly 1%.

SEE ALSO: 10 things you need to know before the opening bell

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10 things you need to know before the opening bell

Business Insider, 1/1/0001 12:00 AM PST

hurricane nate

Here is what you need to know.

President Donald Trump makes opening demands for 'Dreamer' deal — including funding for the wall. The president's list of immigration "principles," laid out in a document seen by Reuters, is likely to be a nonstarter for Democrats.

Hurricane Nate was downgraded to a tropical depression over the weekend after making US landfall twice. It strengthened to a Category 1 hurricane on Friday night, according to the National Hurricane Center.

Harvey Weinstein has been fired from his own company. The board of the Weinstein Company released a statement Sunday saying it had terminated Harvey Weinstein's employment after The New York Times reported that the company’s cofounder had settled lawsuits by at least eight women over sexual-harassment claims.

Rising debt could trigger the next financial crisis, Germany's finance minister warns. Speaking with the Financial Times as he leaves his long-held position, Wolfgang Schaeuble warned that spiraling levels of debt, as well as the growth of liquidity across the world, risked creating a new financial crisis.

Trump fires off a tweet hinting that he's nearing the end of his patience with North Korea. "Our country has been unsuccessfully dealing with North Korea for 25 years, giving billions of dollars & getting nothing. Policy didn't work!" Trump tweeted Monday.

The University of Chicago's Richard Thaler wins the 2017 Nobel Prize in economics. Thaler was awarded the prize "for his contributions to behavioural economics," with the committee saying he had "incorporated psychologically realistic assumptions into analyses of economic decision-making."

The Trump administration has revealed how it wants to make going public easier for companies. The US Treasury department published a report Friday outlining its plan for financial deregulation, which would loosen restrictions on the initial-public-offering process and generally lessen the burden on smaller corporations.

Vice President Mike Pence left an NFL game Sunday after several players took a knee during the national anthem. Shortly after several San Francisco 49ers players knelt before their game against the Indianapolis Colts, Pence announced he had left the game.

Stock markets around the world are mixed. Hong Kong's Hang Seng (-0.46%) fell in Asia, while the Nikkei rose (+0.3%). The FTSE 100 (-0.24%) led mixed results in Europe, which also saw the Euro Stoxx 50 climb (+0.09%). The S&P 500 is set to open up 0.2% near 2,550.

US economic data flows. There's no economic data on Monday, but on Tuesday the NFIB small-business optimism report will be released at 6 a.m. ET, while Wednesday will see MBA mortgage applications at 7 a.m. ET.

SEE ALSO: The stock market just flashed a dangerous warning signal

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BitPay Is Growing? Startup Suspicions Are Fueling Bitcoin's Fork Debate

CoinDesk, 1/1/0001 12:00 AM PST

Should bitcoin's technology change to accommodate merchant users? New data from one of the network's biggest startups is fueling the debate.

500,000 more Brits are expected to be living in poverty by 2021, despite record high employment

Business Insider, 1/1/0001 12:00 AM PST

London poverty

Almost half a million additional people are likely to be in poverty by 2020/21 as a result of the four year freeze on benefits combined with higher-than-forecast inflation, according to a new report by the Joseph Rowntree Foundation (JRF).

The report estimated that, as a result of the drop in the value of the pound and sharp increase in prices following the Brexit vote, 470,000 additional families will be in poverty by the end of the benefits freeze. Incomes, it said, are not keeping up with prices, despite the fact that the UK is experiencing record low unemployment levels.

The November budget "must ensure the incomes of the least well-off keep pace with the cost of essentials by removing the freeze and uprating income-related benefits with consumer price index (CPI) from April 2018, and the local housing allowance with local rents," said the report. The freeze, it said, is the "biggest policy driver" behind the expected rise in poverty.

In the summer of 2015 a freeze on most benefits was announced for working-age people between 2016/17 and 2020/21, including benefits to top up low earnings. But the report stressed "circumstances have changed" since 2015, with the freeze now exacerbating the effects of higher than expected inflation and a decline in real wage growth.

"I have laid awake at night thinking, 'how am I going to pay for this?'" Julie told the JRF. "You can't shop around for your council tax, the only other things you can cut down on are food and fuel."

According to the report, more than half the people experiencing poverty are living in working households, while three in four people have been unable to escape low pay over the decade. As such, the JRF recommends targetting income-related benefits such as tax credits and Job Seekers Allowance, rather than more widespread benefits such as child benefit.

The private rented sector is "fast becoming the tenure that houses people in poverty," said the report, with the number of people in poverty after paying private rental costs having doubled in the decade between 2004/05 and 2014/15.

In central London, Local Housing Allowance (LHA) only covers 55% of the 30th percentile rent (the upper limit for what LHA will cover), creating a shortfall of over £1,000 per month.

Screen Shot 2017 10 09 at 11.12.16

The JRF recommends removing the freeze on income-related benefits and uprating them with CPI inflation from 2018/19. This, it said, would result in 380,000 fewer people in poverty in 2020/21, largely families with children, and would cost £2.8 billion.

Meanwhile, uprating just the child related elements of Universal Credit from 2018/19 would cost around £1 billion in 2020/21, and result in 100,000 fewer people in poverty, while uprating the LHA with local rents would help 4.7 million people who experience poverty after paying household costs.

In February, the JRF warned that nearly a third of the population, or 19 million people, were below the "minimum income standard," an increase of 4 million people since 2008/9.

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Bit2Art.com, the Innovative Platform Allowing You to Buy Artworks -From Basquiat to Haring- in Bitcoins

CryptoCoins News, 1/1/0001 12:00 AM PST

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The CFTC Still Doesn't Know What Constitutes Cryptocurrency 'Delivery'

CoinDesk, 1/1/0001 12:00 AM PST

The CFTC is still working on rules to define when a digital commodity like bitcoin has been "delivered," an official has said.

The University of Chicago's Richard Thaler wins the 2017 Nobel Prize in economics

Business Insider, 1/1/0001 12:00 AM PST

Richard Thaler

LONDON — Economist Richard Thaler has been awarded the 2017 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, often considered to be the most prestigious prize in the field of economics.

Thaler was awarded the prize "for his contributions to behavioural economics."

According to the Nobel committee, Thaler has "incorporated psychologically realistic assumptions into analyses of economic decision-making."

"By exploring the consequences of limited rationality, social preferences, and lack of self-control, he has shown how these human traits systematically affect individual decisions as well as market outcomes."

Thaler's work examines how human psychology impacts economic and financial decision making, as well as trying to make economists realise that "economic agents are human" and cannot always be treated as rational actors.

While the prize has been awarded to lesser known economists several times in recent years, Thaler is one of the world's best known economists and his book "Nudge: Improving Decisions about Health, Wealth, and Happiness" — which he co-authored with Harvard professor Cass R. Sunstein, is one of the most widely read economics books of recent years.

He also appeared in the film "The Big Short" alongside popstar Selena Gomez explaining the concept of the "hot hand fallacy" a key behavioural feature that drove the rise of synthetic collateralised debt obligations — one of the key drivers of the US subprime mortgage crisis in 2007 — as the video below shows:

Thaler is currently the Charles R. Walgreen Distinguished Service Professor of Behavioural Science and Economics. His interests outside of economics include golf and fine wine.

Although the prize cannot technically be considered a Nobel Prize as it was not established in the will of Alfred Nobel, it is regarded to be equivalent to those prizes (Chemistry, Literature, Peace, Physics and Medicine), and is effectively a Nobel Prize for Economics.

The prize is given to an economist who has made a substantial contribution toward the subject, with an award of 9 million Swedish krona ($1.1 million, £844,000).

The prize has previously gone to such major names as Milton Friedman, Paul Krugman, and Friedrich von Hayek. Political scientists whose work has influenced economics as a discipline have also been honoured in the past.

Last year's prize was awarded to economists Oliver Hart and Bengt Holmström for work on contract theory, the study of how contracts and incentives influence decision-making and business relationships.

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Peer-to-peer lender Lendy Finance is said to be under investigation by City watchdog

Business Insider, 1/1/0001 12:00 AM PST

RTXY4OJ

LONDON – The city watchdog is said to be looking into accounts of peer-to-peer lender Lendy Finance, according to The Telegraph.

The Sunday Telegraph revealed last month that nearly a quarter of Lendy Finance's loan book was outside terms, meaning repayments were late.

This has now grown to a third of the loan book, or £59 million of loans, according to The Telegraph.

The Financial Conduct Authority (FCA) is said to be investigating the company's books, as part of growing concerns about the lender's property valuations and wider concerns about how peer-to-peer lenders disclose default rates and levels of due diligence.

The UK's peer-to-peer lenders will soon have to disclose more detailed information about how much investors have lost on loans. An ongoing FCA consultation into creditworthiness in consumer credit was begun in July, prompted by concerns about the risk of potential harm to customers from poor culture and practice by firms.

Although Lendy said its due diligence team had been strengthened this year, it told investors last week it was suspending a £3.4 million loan on Westbury Castle Estate, because of an "adverse opinion" on the property value, according to The Telegraph.

"As part of our application for full FCA authorization, we meet with the FCA on a regular basis," a spokesperson for Lendy told the paper. The company also said it had the option of pursuing legal remedies cases of negligent overvaluations.

The FCA declined to comment.

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Ex-ECB board member Jorg Asmussen leaves Funding Circle board for advisory role

Business Insider, 1/1/0001 12:00 AM PST

Jorg Asmussen

LONDON – German economist and politician Jörg Asmussen has moved into an advisory role at Funding Circle, leaving the London-headquartered peer-to-peer lender's board after a year and a half.

A spokesperson for Funding Circle confirmed that Asmussen, who was on the European Central Bank (ECB) executive board from 2012 to 2013, has moved into a more informal role after taking on a senior position at investment bank Lazard, which he joined in July of last year.

The spokesperson said Asmussen "still working closely with the business and meets Thorsten and the rest of the German team every couple of weeks."

Asmussen joined Funding Circle's board as a non-executive director in March last year.

Asmussen was State Secretary at the German Ministry of Finance, serving under Finance Minister Wolfgang Schaeuble during the crunch period of 2008 to 2012.

He led German's crisis management team after the Lehmann Brothers bankruptcy and was a key negotiator in the European sovereign debt crisis.

More recently, Asmussen served as State Secretary for the German Ministry of Labour and Social Affairs from 2014 to 2015. During his time at the ECB, the Financial Times dubbed him "One of the most influential members of the European Central Bank's governing council."

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Germany is battling for London's €930-billion-a-day clearing business

Business Insider, 1/1/0001 12:00 AM PST

Traders work at their desks in front of the German share price index, DAX board, at the stock exchange in Frankfurt, Germany, March 20, 2017.

LONDON — Germany's main financial market index provider Deutsche Boerse is battling to secure the business of clearing euro derivative contracts after Brexit.

The company on Monday announced a new plan to share profits with the largest participants on its Eurex clearing platform in an attempt to bring more business to the country and pull it away from London.

Under the new scheme Eurex, which clears derivatives and other financial instruments, will give a share of its profits to its 10 most active participants, as well as offering seats on its board to the biggest five.

JPMorgan, Citi, Deutsche Bank, and Morgan Stanley have all already expressed an interest in the scheme, a Eurex statement on Monday said.

"This market-led initiative will benefit clients and the broader marketplace through greater choice and competition, improved price transparency as well as reduced concentration risk," Eric Muller, head of Eurex Clearing said.

Clearing houses such as LCH and ICE Clear Europe in London manage credit risk, acting as a middle-man in swaps and derivatives trades to guarantee the contract in the event that one of the parties involved in the trade goes bust. They have grown in importance since the financial crisis as they are meant to limit systematic risk. Around 70% of euro-denominated trades worth €930 billion (£820 billion) a day pass through London, according to a House of Lords report.

The location of euro-denominated trade clearing has been a hot topic since the euro first entered circulation in the late 1990s.

European policymakers have argued that euro clearing should take place within the euro area. Britain has repeatedly had to defend its right to clear euro trades, given that it does not have the euro. Years of disputes culminated in a legal battle in 2015, which the UK ultimately won.

However, Brexit has provided fresh impetus for those seeking to move clearing out of London. The ECB proposed a change to its statutes that would give it "a clear legal competence in the area of central clearing," back in June.

The Bank of England last week warned that there are "significant risks from disruption to cross-border clearing activity between the UK and EU."

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Bitcoiner Charlie Shrem Helps GoldMint as Advisory Board Welcomes Two Industry Experts

CryptoCoins News, 1/1/0001 12:00 AM PST

[…]

The post Bitcoiner Charlie Shrem Helps GoldMint as Advisory Board Welcomes Two Industry Experts appeared first on CryptoCoinsNews.

Polling company YouGov reports a 21% jump in sales after predicting this year's surprise election result

Business Insider, 1/1/0001 12:00 AM PST

Jeremy Corbyn and Theresa May

LONDON – YouGov, the only major polling company to predict a hung parliament in June's snap election, reported a 21% jump in profits for the year ending July 2017.

YouGov reported a jump in total sales of over a fifth compared to last year, to £107 million, or a rise of 9% in constant currency.

Meanwhile, profit before tax was up 43% to £7.9 million. The group's newer Data Products and Services products performed particularly well, with revenue up 37%.

"This is the third consecutive year in which YouGov has delivered growth significantly above the market, both in revenue and profit," said Chief Executive Stephan Shakespeare.

"Our systematic approach to market research which combines our syndicated data with new proprietary analytic methodologies to deliver greater granularity and accuracy, points to an exiting future," he said.

In May, YouGov predicted Prime Minister Theresa May was on track to lose her majority in parliament, and that Labour could gain almost 30 seats. This unexpected result, the poll said, would cause a "hung parliament," with no party having overall control and leading to a coalition government.

Although the group said Brexit continued to create uncertainty, the weakness of the pound against the dollar bolstered the year's sales, since the US was the biggest market and generated almost 40% of sales.

The diversification of YouGov's services from traditional market research to include newer, subscription-based Data Products and Services — such as brand intelligence tracker YouGov BrandIndex and audience planning product YouGov Profiles — proved especially successful: bolstered by a strong growth in sales, these products accounted for almost half (44%) of the group's total sales for the year.

The group's organic growth rate was "once again well above that of the global research market." Shakespeare said such strong trading was in line with expectations, and that the group expected continued growth going forward.

YouGov's shares were up 2.56% as of 08:46 BST (03:46 EST) on Monday morning, at an all-time high:Screen Shot 2017 10 09 at 08.47.52

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Rumor or Not: Goldman Trading Would Change Bitcoin

CoinDesk, 1/1/0001 12:00 AM PST

If Goldman Sachs does launch a bitcoin trading desk, as rumors hint it might, the impact will be felt further afield than the bottom line.

You can now buy full citizenship of the Pacific nation of Vanuatu for less than 44 bitcoin

Business Insider, 1/1/0001 12:00 AM PST

Vanuatu

LONDON – The South Pacific island nation of Vanuatu will accept payments in Bitcoin for its $200,000 citizenship program, becoming the first country to accept the cryptocurrency in return for citizen status.

Bitcoin is trading at $4,581 at current market rates, meaning Vanuatu's citizenship by investment program would cost around 43.64 bitcoin.

Vanuatu is a member of the Commonwealth and citizenship provides visa-free travel to 113 countries including the UK, Russia and European Union states.

Vanuatu also advertises its low taxes for citizenship buyers, offering a second passport in a country that levies no capital gains or income taxes. Potential citizens don't need to live in Vanuatu, or even visit the country once.

James Harris, managing director of the Vanuatu Information Centre Network said: "There remains some suspicion surrounding the use of crypto-currency in financial transactions, and some fears that it can be related to undesirable activities.

"In fact, the opposite is true, as crypto-currency exists in a fully traceable ledger where the entire history of its creation and trading is visible," he said. 

The multi-billion dollar investment migration industry, which sees governments offering visas and citizenship to people in return for investments in local businesses and property, has boomed amid increased global uncertainty over borders and immigration.

Earlier this year, the Thai government started offering "elite" residency visas for wealthy foreign citizens, allowing them to live in the country for around $3,000 (£2,403) a year.

There are seven different packages, with the most expensive being the "Elite Ultimate Privilege" scheme. It costs $60,000 for 20 years residency, along with a $600 a year membership fee.

Included in the price is a state-sponsored concierge programme, entitling members to VIP access to government agencies dealing with immigration, driving licences, and work permits.

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Rising debt could trigger the next financial crisis, Germany's finance minister warns

Business Insider, 1/1/0001 12:00 AM PST

Wolfgang Schauble

LONDON — Germany's outgoing Finance Minister Wolfgang Schaeuble warned that spiralling levels of debt, as well as the growth of liquidity across the world, risk creating a new financial crisis.

Speaking to the Financial Times as he leaves his long-held post at Germany's finance ministry and becomes the Speaker of the Bundestag, Schaeuble said that his view is shared by economists around the world.

"Economists all over the world are concerned about the increased risks arising from the accumulation of more and more liquidity and the growth of public and private debt. I myself am concerned about this, too," Schaeuble said.

Schaeuble — who is renowned and often disliked across Europe for being hugely critical of the European Central Bank's hyper loose monetary policy since the financial crisis — also said that the financial world is in danger of "encouraging new bubbles to form" thanks to the cash injections into the markets overseen by central banks like the ECB and the Fed.

The comments echo those made by International Monetary Fund Managing Director Christine Lagarde last week, who said that there are "threats on the horizon" for the global economy, which are largely associated with rising debt, despite the fact that "we are seeing some sun break through," when it comes to a global economic recovery taking root.

"There are threats on the horizon: from high levels of debt in many countries, to rapid credit expansion in China, to excessive risk-taking in financial markets," Lagarde said in a speech at Harvard University.

Earlier this year, an IMF report warned that China's huge debt pile could be the trigger for the next financial crisis as borrowing reaches unsustainable levels.

"International experience suggests that China’s credit growth is on a dangerous trajectory, with increasing risks of a disruptive adjustment or a marked growth slowdown," the report said.

As well as opposing loose monetary policy, Schaeuble is well-known for heavily favouring fiscally responsible policies and defended those beliefs, saying that austerity is "strictly speaking, an Anglo-Saxon way of describing a solid financial policy which doesn’t necessarily see more, or higher deficits as a good thing." 

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10 things you need to know in markets today

Business Insider, 1/1/0001 12:00 AM PST

A couple kiss during a demonstration in favour of dialogue to resolve Catalonia´s bid for independence, in Madrid, Spain, October 7, 2017.

Good morning! Here's what you need to know in markets on Monday.

1. The UK government has been told it has less than six months to strike a Brexit deal in order to prevent an exodus from the City of London. Sky News reports that RBS chairman Sir Howard Davies warned there is now a "very, very, very tight" time frame for ministers to agree the terms of a transitional Brexit agreement with the EU, if it hopes to stop major finance firms moving jobs abroad.

2. Wolfgang Schäuble has warned that spiralling levels of global debt and liquidity present a major risk to the world economy, in his parting shot as Germany’s finance minister. In an interview with the Financial Times, the Europhile said there was a danger of “new bubbles” forming due to the trillions of dollars that central banks have pumped into markets.

3. HSBC wants to appoint company insider John Flint as its next chief executive and has approached regulators seeking their approval, Britain's Sunday Times newspaper said. Europe's biggest bank has told the Bank of England it wants approval for Flint, who currently runs the lender's retail and wealth management businesses, to take over from Stuart Gulliver, the paper said, citing unnamed sources.

4. A lawyer is pressing the government to publish legal advice it has allegedly received in secret saying that Brexit can be stopped at any time and Britain can remain in the European Union. The Observer newspaper reported that lawyer Jessica Simor QC, from Matrix chambers, has been told by "two good sources" that the Prime Minister has received advice that "the article 50 notification can be withdrawn by the UK at any time before 29 March 2019 resulting in the UK remaining in the EU on its current favourable terms."

5. Prices may rise and home deliveries could be slower unless the retail sector retains access to all EU workers after Brexit, a trade body has warned. EU citizens account for just 6% of the industry's 170,000 workforce, the British Retail Consortium said according to the BBC.

6. Deutsche Börse is intensifying its efforts to wrestle the prized euro derivatives clearing market away from London ahead of Brexit by drawing up a plan to share profits from the business with its members. The Financial Times reports that the German exchange is preparing to change the way it runs Eurex Clearing to give the investment banks that dominate the global swaps market more financial incentives to use its clearing house.

7. Asian share markets inched higher on Monday as the flow of economic news remained generally supportive of global growth, while political uncertainty caused some early ructions in currencies. Japan's Nikkei closed up 0.30%, while the Hong Kong Hang Seng is down 0.46% at the time of writing (6.25 a.m. BST/1.25 a.m. ET) and China's Shanghai Composite is up 0.98%.

8. Bitcoin is back above $4,500 for the first time in a month. The digital currency is up 0.07% to $4,604.78 at 6.30 a.m. BST (1.30 a.m. ET).

9. Coca Cola is spending £10 million to relaunch Schweppes in the UK as part of a fightback against posh new entrants to the tonic market such as Fever-Tree and Fentimans. The drinks giant is relaunching its core Schweppes tonic range with newly designed bottles and plans to spend £10 million on a marketing campaign that will include sponsorship of ITV's prime time Jonathan Ross Show.

10. The CEO of Tesco insists the supermarket can be as innovative as the likes of HelloFresh and Amazon, and says it is experimenting with new ideas such as meal kits and checkout-free stores. Dave Lewis was peppered with questions about competition with Amazon at a press conference in London last week, following the e-commerce giant's acquisition of US grocer Whole Foods earlier this year.

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Elon Musk tweeted a slow-motion video of the Tesla Model 3 assembly line

Business Insider, 1/1/0001 12:00 AM PST

tesla model 3

Elon Musk tweeted a video of the Tesla Model 3 assembly line on Sunday. The video shows automated robots inside Tesla's Fremont factory working on the bare-metal body of a Model 3, the electric-car maker's first mass-market vehicle, which began shipping in the third quarter of this year.

Tesla last week showed that it produced just 260 Model 3s during that period, falling far short of its goal to crank out 1,500 of the cars in September. Tesla blamed the shortfall on "production bottlenecks."

Watch the Model 3 assembly line video below:

The Model 3 body line slowed down to 1/10th speed

A post shared by Elon Musk (@elonmusk) on Oct 8, 2017 at 3:20pm PDT on

"Although the vast majority of manufacturing subsystems at both our California car plant and our Nevada Gigafactory are able to operate at a high rate, a handful have taken longer to activate than expected," the company said in a statement on Monday. The shortfall has also cast doubt on Tesla's ability to produce the 20,000 Model 3s per month that it said it would reach by December.

News of the Model 3 production challenges likely won't rattle Tesla investors or its customers, Business Insider's Matt DeBord noted on Saturday, adding that Tesla stock is still up 65% in 2017 and the brand has lost none of its captivating aura. And the video perhaps proves that despite the hiccups, Tesla has lost none of its mojo.

SEE ALSO: Tesla is struggling to build the Model 3 — here's why

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