Coin News

According to Jonathan Cheesman, a partner at investment firm Distributed Global, Bitcoin has fallen due to five major reasons: macro trend, speculative dominance, regulatory uncertainty, short selling, and scams. But, as the market and cryptocurrencies as an asset class continue to see improvements in infrastructure and regulation, Cheesman explained that a growing number of investors

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• Citigroup has created what it's calling a Digital Asset Receipt or DAR, thought to be the most direct way to invest in cryptocurrencies without owning them, according to people with knowledge of the project.
• The DAR works much like an American Depository Receipt, which gives US investors the ability to invest in foreign stocks that aren't traded on US exchanges. 
• The structure would place cryptocurrencies within existing regulatory regimes and give big Wall Street investors a less risky way of investing in the fledgling asset class. 

Citigroup may have cracked the cryptocurrency code. 

The New York-based bank has come up with perhaps the most direct way to invest in cryptocurrencies without actually owning them, according to people with knowledge of the plans. The structure would place cryptocurrencies within existing regulatory regimes and give big Wall Street investors like asset managers and hedge funds a less risky way of investing in the fledgling asset class. 

Citi has developed an instrument it's calling a Digital Asset Receipt or DAR. It works much like an American Depository Receipt or ADR, which has been around for decades to give US investors a way to own foreign stocks that don't otherwise trade on US exchanges. The foreign stock is held by a bank, which then issues the depository receipt. 

In this case, the cryptocurrency is held by a custodian and the DAR is issued by Citigroup, the people said. The bank will alert the Depository Trust & Clearing Corp, a Wall Street middleman that provides clearing and settlement services, once it's issued the receipt, one of the people said. That lends an important layer of legitimacy and gives investors a way to track the investment within a system that they're already familiar with, the person added. 

The project is a collaboration between the bank's capital markets origination team and the depository receipts services team, the people said.

It's unclear what stage of development Citi is with the project and when it will launch but the bank has already begun to reach out to potential partners. A Citigroup spokeswoman declined to comment on the bank's plans. 

Citigroup is one of the largest issuers of ADRs in the world. The bank began issuing depository receipts in 1928, and has won numerous awards for its offering, according to its website. 

Wall Street has tread carefully with the burgeoning cryptocurrency market, which is vulnerable to wild price swings, repeated hacks of exchanges and wallets, and a stigma that it enables criminal behavior.

As a result, Citi has held back from earlier efforts to participate in cryptocurrency markets. Unlike firms like Morgan Stanley and Goldman Sachs, Citi did not immediately clear bitcoin futures trades for its clients and it's kept a lower profile than some of its peers. It also banned clients from making crypto currency related purchases with its credit cards.

But it has been hiring in the sector. The bank was seeking a vice president and senior vice president to explore risks associated with money laundering in bitcoin, cryptocurrency, and other nascent payment technologies, according to LinkedIn job ads posted earlier this year. Bitcoin has often been associated with activities such as money laundering.

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Jackson Palmer, a product developer at Adobe and the creator of Dogecoin, has said that developers in the crypto community will now have to find a way to encourage users of centralized systems to convert to decentralized applications (dApps). Decentralized systems and applications are significantly less efficient in processing information than centralized platforms. As such,

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• Victoria's Secret and its Pink branch, owned by L Brands, are in the "early innings" of a long decline, according to an analyst at Jefferies.
• Increased promotional activity in Victoria's Secret has not only failed to drive sales, but has also weighed on margins. 
• Watch L Brands trade in real-time here.

The decline for Victoria's Secret and its Pink branch, owned by L Brands, is just beginning, according to analysts from Jefferies.

Victoria's Secret's August same-store sales dropped 5% compared to the previous year, below the 3.8% decrease expected. That was "despite heavy promotions that drove the merchandise margin down significantly YoY," a team of analysts led by Randal Konik wrote in a note sent out to clients on Thursday.

In a previous note, Konik warned that Victoria's Secret was taking a "scary" step in promoting its "buy 2 get 1 free" Body By Victoria bras offer and selling $3 panties for its Pink members, the lowest ever price point for panties across Victoria's Secret and its Pink branch.

"Victoria's Secret brand is broken and Pink is now breaking," Konik said in an August 20 note.

Victoria's Secret's owner L Brands has been under pressure since last month. In its second-quarter earnings, the retailer beat earnings both on the top and bottom lines, but cut its full-year guidance. L Brands also announced that Denise Landman, CEO for Victoria's Secret Pink brand, will retire and be replaced by a leader from the Bath & Body Works [BBW] franchise.

Konik said that BBW is performing well, but questioned it's potential to offset the decline at Victoria's Secret.

"BBW continues to be strong, with favorable customer acceptance to new product driving [comparable sales] up 15%, well ahead of the consensus of 5%," Konik said. "However, we note that the business is cyclical, and we think it will eventually moderate."

"With little value left for VS, Pink in the early innings of what we believe will be a long decline, and BBW, while strong, not capable of supporting the entire business, we see cash flow prospects declining and believe shares can move much lower," Konik added.

Konik has a price target of $20 on L Brands, 25% below its current price.

Shares of L Brands are down 55% since the start of this year.

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Earlier today, on September 9, the price of ETH, the native cryptocurrency of Ethereum, fell to its yearly low at $185. While ETH has rebounded above the $200 mark after an unforeseen recovery of Bitcoin from $6,190 to $6,450, since July, ETH has seen a steeper decline in value than other major cryptocurrencies. How Much

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• Sweden goes to the polls on Sunday, with the right-wing, anti-immigration Sweden Democrats set to make big gains.
• The party's leader Jimmie Åkesson has frequently called for a referendum on leaving the European Union.
• If Sweden were to leave the EU, growth and jobs would suffer, according to research from Oxford Economics.

Sweden goes to the polls on Sunday to elect a new government in a vote that many commentators believe is the most contentious in decades.

The election is likely to see a strong performance from the Sweden Democrats, a right-wing, anti-immigration party with historical associations with the country's neo-Nazi movement.

It is expected to finish among the top three parties, and could find itself with some representation in the country's government.

Like many anti-immigration parties in Europe, the Sweden Democrats are highly Eurosceptic, with its leader Jimmie Åkesson frequently arguing that the country should hold a referendum on whether it should remain or leave in the European Union.

While a referendum is probably a long way off, it is now not impossible that Sweden could hold a vote for a so-called Swexit from the EU.

"Although the option of leaving the European Union (EU) does not hold majority support amongst the Swedish population," a report from Oxford Economics this week said, "the topic has garnered increasing attention since the Sweden Democrats announced their intention to hold a referendum on membership after the 2018 general election."

But what would Sweden, the EU's seventh-largest economy, leaving the EU actually mean economically?

Like the UK, Sweden is somewhat peripheral to the EU. It is not part of the continental mainland, and is not part of the euro. Nevertheless, it would be a major event for both the nation and the EU as a whole.

Oxford Economics' report made clear that the possible outcomes surrounding Swexit are hugely unclear, but based its assumptions on Sweden voting to leave, before ultimately pursuing a most-favoured-nation relationship with the EU while trading on World Trade Organisation rules.

It also assumes Sweden triggering Article 50 — the mechanism for leaving the EU — in 2019, leading to a leaving date of 2021.

Slower growth, lowered migration, higher unemployment

The long and the short of Oxford's forecasts, which are based on a ten-year span to 2031, is that things would not be good for the Nordic nation. 

"In the Swexit scenario Sweden's real GDP declines by 4.0% in real terms compared to our baseline forecast in which Sweden remains a member of the EU," the report, compiled by Henry Worthington, said.

Not only would Swexit lead to slower GDP growth going forward, it would also lead to lowered migration, the report said. That, in line with weak growth, would see unemployment increase significantly, the report said.

"In our baseline forecast employment is projected to grow at 0.16% per year during the scenario horizon, a rate which drops to virtually zero in the Swexit scenario," Oxford Economics wrote.

"As a result, the Swedish economy supports 73,000 fewer jobs in 2031 compared to baseline a decline of 1.4 percent."

Household finances would also suffer, losing a cumulative 30,300 krona on average in the 10 years after Swexit, equivalent to around $3,300.

The positives

There would also be positives, however, thanks to the fact that after leaving the EU "Sweden would no longer have to contribute to the EU budget, freeing up fiscal resources to finance investment in public services or tax cuts."

Here's the key extract:

"As a relatively high-income member, Sweden has consistently been a net contributor to the EU budget, a pattern can be expected to continue going forward. In total, we forecast that Sweden’s net contribution during the scenario horizon would total €51.3 billion.

"Despite an assumed 'divorce bill' of €24.3 billion this still yields a fiscal dividend of €27.0 billion equivalent to 0.4 percent of GDP over the scenario horizon."

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According to Vitalik Buterin, the co-creator of Ethereum, the days of 1000x growth as seen in 2017 in the cryptocurrency sector is gone. Speaking to Bloomberg, Buterin emphasized that the awareness of cryptocurrencies and blockchain technology has already achieved its high point in Dec. 2017, when the price of major cryptocurrencies like Bitcoin, Ethereum, Ripple,

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According to Vitalik Buterin, the co-creator of Ethereum, the days of 1000x growth as seen in 2017 in the cryptocurrency sector is gone. Speaking to Bloomberg, Buterin emphasized that the awareness of cryptocurrencies and blockchain technology has already achieved its high point in Dec. 2017, when the price of major cryptocurrencies like Bitcoin, Ethereum, Ripple,

The post Ethereum Creator Believes Days of 1000x Crypto Growth is Gone appeared first on CCN

In seconds, the Bitcoin price has surged from $6,190 to $6,450, by more than 4 percent, after the dominant cryptocurrency remained in the low $6,100 region for more than 24 hours. The sudden increase in the price of Bitcoin on September 9 was not expected by the majority of analysts and investors in the cryptocurrency

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• John Hussman, the outspoken investor and former professor who has been predicting a stock market crash, highlights a change he says has occurred in investor psychology since the February correction.
• He argues that this "subtle shift" is a glaring red flag for the stock market at current valuations, and leaves it more vulnerable than ever to a meltdown.

Even the most bullish equity investors would probably concede that the stock market is overextended — at least by traditional measures of valuation.

But that doesn't mean they're ready to act on that information.

For evidence of that, consider that the 9-1/2-year bull market is now the longest on record — a milestone that's come amid a string of new record highs for stocks. In many cases, investors have been willing to ignore the flashing warning signs in favor of continued strong returns.

And as that's happened, valuation metrics have climbed into even more rarefied air, endlessly frustrating market traditionalists who see a disaster brewing.

John Hussman — a former economics professor who's now the president of the Hussman Investment Trust — falls firmly into that camp.

He's stood by and watched as a seemingly endless supply of buying power has pushed valuations to eye-popping levels that exceed the fervor seen around the 2000 dotcom peak, as well as the Great Recession of 1929.

The chart below shows five valuation metrics monitored by Hussman that bear this out. In his mind, these measures — which are listed in the chart's legend — have been highly correlated with future S&P 500 returns throughout history.

"Last week, the stock market recorded the most offensive valuation extreme in history," Hussman wrote in a blog post from September 4. "I am aware of no plausible conditions under which current extremes are likely to work out well for investors."

A recent shift that's changed the game

If you've followed Hussman's work at all in recent months, you likely know he's been making such bearish proclamations for quite some time.

It's been a trying time for him as he waits for the market reckoning he's predicted to occur. Over that period, Hussman's become quite self-aware, referring to himself as a "realistic optimist often viewed as a prophet of doom" in his Twitter bio.

He's even gone as far as to diagnose why exactly his long-forecast market crash hasn't transpired. At this point, he readily admits that he misjudged the willingness of return-hungry investors to ignore red flags, particularly as they pertain to valuation.

But a recent development has emboldened Hussman to once again reiterate his bearish forecast — one that calls for the US equity market to lose roughly two-thirds of its current value. He describes it as a "subtle shift of investor psychology."

It all traces back to measures of market internals that Hussman says reflect risk appetite. He argues that — following the 11% correction that rocked US stocks back in February — the minds of investors became infected. They became more risk-averse, whether they intended to or not, which market behavior started to reflect.

Hussman notes that those internals have only worsened in the period since. He highlights the narrowing of stock market leadership, the increased idiosyncracy of individual stock trading, and weakness in corporate bonds.

And before you call Hussman an unabashed doomsayer, note that he readily admits he'd consider a constructive — or even bullish — stance on the market if these internals turned around.

Unfortunately, at this point, he says they've been heading in the wrong direction for far too long.

"While we've observed nearly perpetual 'overvalued, overbought, overbullish' syndromes for years during the recent half-cycle, the current extreme is combined with unfavorable market internals," said Hussman. "Which indicates a subtle shift of investor psychology toward risk-aversion, and opens up a trap door below the market."

Hussman's track record

For the uninitiated, Hussman has repeatedly made headlines by predicting a stock-market decline exceeding 60% and forecasting a full decade of negative equity returns. And as the stock market has continued its seemingly unstoppable grind higher, he's persisted with his calls, undeterred.

But before you dismiss Hussman as a wonky perma-bear, consider his track record, which he breaks down in his latest blog post. Here are the arguments he lays out:

• Predicted in March 2000 that tech stocks would plunge 83%, then the tech-heavy Nasdaq 100 index lost an "improbably precise" 83% during a period from 2000 to 2002
• Predicted in 2000 that the S&P 500 would likely see negative total returns over the following decade, which it did
• Predicted in April 2007 that the S&P 500 could lose 40%, then it lost 55% in the subsequent collapse between 2007 and 2009

In the end, the more evidence Hussman unearths around the stock market's unsustainable conditions, the more worried investors should get. Sure, there may still be returns to be realized in this current market cycle, but at what point does the mounting risk of a crash become too unbearable?

That's a question investors will have to answer themselves. And one that Hussman will clearly keep exploring in the interim.

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