Tag: finance

Dow Futures Soar 400 Points – Most In 6 Months – Bonds & Bullion Bid

With the biggest point rise in six months, The Dow is up over 400 points – having retraced almost 50% of last week’s collapse – on what is being claimed as an earnings-driven surge.

Trannies and Small Caps are surging this week…

Which smells a lot like a big short squeeze… and it is…

The S&P, Dow, and Nasdaq have all bounced off key technical levels…

 

The dollar is down but bonds and bullion are also bid…

From last Monday’s close, Gold is the big winner, bonds are flatish and Bitcoin and the S&P are down 3.3%…

 

And while we hate to steal the jam out of everyone’s donut, we note that Nasdaq remains down around 6% in October…

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A fantastic Plan B solution for your future children

[Editor’s note: While Simon is traveling today, other members of the Sovereign Man team penned today’s missive.]

February 2013, a 500+ foot yacht docked on the west side of Manhattan.

The boat, named Eclipse, belonged to the Russian oligarch, Roman Abramovich – one of the richest men in the world. And the media went wild speculating why Abramovich had parked his mega-yacht in the US for more than a month.

On April 8, with the boat still docked, Abramovich’s girlfriend Dasha Zhukova gave birth to a baby girl at New York Presbyterian hospital.

And because Abramovich’s daughter, Leah Lou, was born on US soil, she gained a US citizenship (in addition to a Russian citizenship).

Leah didn’t realize it, but her father was giving her a tremendous gift by harboring his yacht in the US.

We talk a lot at Sovereign Man about having a Plan B.

You can take a few simple steps to, for example, get some money outside your home jurisdiction or get a second residency.

That way, if things go south in your home country, you’ll have more options and more freedom. And if nothing happens, you won’t be any worse off.

Lots of folks consider a second passport the “holy grail” of a Plan B.

Should you need to leave your home country for any reason, a second passport gives you another place where you can live, work, invest and retire.

There are a few ways to get a second citizenship.

You can naturalize, which requires you to move to a foreign country and live there for several years.

You can also get a second citizenship if you have ancestors from countries like Italy or Ireland.

Many countries, from St. Kitts to Malta, also sell citizenships for anywhere from a couple hundred grand to a couple million dollars.

But today I want to tell you about a much easier solution.

Like Roman Abramovich, you can give your future child a second citizenship from the moment of his or her birth.

If you have your baby in one of the 30+ Jus Soli countries (states granting automatic citizenship to any child born on their territory), your newborn will automatically acquire two citizenships – one from your home country and one from the country of their birth.

And later in life, your child have more options for where they can live, work, invest and retire.

And with a second passport, your child will enjoy visa-free access to more countries around the world, which again means more freedom.

All it takes to give that invaluable gift is approximately three months spent on the ground and a few thousand dollars spent on travel and a private clinic.

Almost all Jus Soli countries are located in the North and South America and traditionally, the US has been the go-to destination to have your baby.

But what most of those parents don’t realize is that they also sign their children up for a world-wide taxation by Uncle Sam, even if their child never sets a foot on American soil again after they leave… Generally, every US citizen has to start paying taxes to Uncle Sam by the age of 18.

Instead, I’d consider having a baby in Chile.

According to our recent study, Chile boasts the best travel document among all Jus Soli countries, hands down. In fact, it is the 6th best travel document in the world, way ahead of the USA (26th place) and Canada (25th).

Chilean citizens enjoy visa free access to the US, Canada, Europe, Brazil, Russia, and many more…

Also, Chile is very peaceful. The last time Chile had a war was almost 130 years ago. And your child does not risk a military conscription as a Chilean citizen.

Having a baby there can also be beneficial for you if you decide to move to Chile yourself – parents of a Chilean citizen can legally reside in the country, no conditions attached.

But that’s not all. Chilean citizenship comes with two additional benefits.

First, any Chilean citizen can easily move to and live, work, study… in any other country in South America because of the Mercosur. Mercosur is a free-trade union of countries, which includes Argentina, Brazil, Paraguay and Uruguay, and associate members of Chile, Peru, Ecuador, Colombia, Guyana and Suriname.

And second, a national of any Spanish-American country (plus Brazil) also can obtain a citizenship in Spain after just two years of residency there, instead of the usual ten. And they won’t have to give up their original citizenship – something that Spain requires from other candidates naturalizing there.

(These Spain-related  benefits only apply to people born in Chile. If you naturalize in Chile at an older age, that won’t work for Spain.)

And if your child does not live in Chile, he/she will not owe a dime to a Chilean government in taxes.

That’s a tremendous amount of benefit for not a lot of effort.

You are usually in full control of where your children are born. If you strategically select the birthplace of your children, dedicate a couple of months of your time to it and a few thousand dollars, you will set them up for a lifetime of benefits.

While we think Chile is the best option, there are plenty of other countries where you can have a child and that child will automatically gain a second citizenship – Canada and Brazil are two others, for example.

If you’d like to learn more about the different ways you can obtain second citizenships for you and your family, here’s a great, free resource to get started.

Source

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When Will Chasing The Stock Market No Longer Work?

Authored by Kevin Muir via The Macro Tourist blog,

If someone had asked me to name the driving factors influencing US stock market performance return over the past year, I might have guessed the cut in the tax rate, but I would then be at loss to further explain what has been moving stocks.

Lucky for me, Bloomberg has this great function that allows us to examine how various portfolio factors have performed over different time frames. It works by taking the stock market universe, then ranking the companies by the requested factor (whether it be P/E, cash flow, etc…) into five quintiles. Using the average return of the top quintile during the requested period, minus the average return of the bottom quintile, gives a great sense of the sensitivity of that factor in individual stock market performance.

Let’s have a look at the best and worst factors during the last year:

At the top of the list are momentum-type factors and then volatilty. Who’d thunk it?

But what does that really mean?

The top-performing factor – by a rather large margin – was “3M Target Price Change %”. Bloomberg defines this as “Percent Change in the Best Target Price over past 3 months. When an analyst jumps out ahead of the pack and cranks his/her target, this puts that stock to the top of the list for this factor. This means that mindlessly following analyst 3-month target price changes was the smartest strategy over the past year from this list.

Really? That’s kind of mind-boggling. It implies analysts are actually adding value with their calls. When did that last happen? I am an old-school institutional trader who likes to rib my analyst pals of a famous line often recited on trading desks – “research analysts: in a bull market – who needs them? In a bear market – who can afford them?”

Well, the laugh is on me. Chasing these analysts’ boldest calls is a top-performing strategy.

And the next top-performing factor, “PORT US MOMENTUM”, is another one of those it-can’t-be-that-simple strategies. Bloomberg defines this little gem as the “arithmetic average of weekly return for trailing 52 weeks lagged by two weeks. So basically, you buy what’s been going up for the past year while shorting what’s been declining.

Huh? What about stuff like Price/Earnings or Price/Book ratios? Where are those fundamental factors? Surely, just chasing the hot stock can’t be a portfolio strategy.

Yet that is exactly what the market is telling you has been working.

The next one – “1M Volatility” is really an offshoot of the previous two. If investors are chasing faster growing stocks (which are typically more volatile), then we would expect to see volatility outperform as a factor.

Now let’s examine the bottom three factors that have been doing the poorest job over the past year.

“Dividend Yield (Indicated)” has returned a whopping minus 10%. Obviously the market has stopped rewarding investors hiding in supposedly safe higher-yielding dividend stocks. Given the fact that since the Great Financial Crisis a torrent of yield-starved money has flowed into these companies, it makes sense that eventually we would hit a point where they stop rising. 2018 seems to be the point where that trade reverses hard. Blame it on the Fed raising rates, or maybe it was just time, but this strategy is no longer working.

Next up – “PORT US Leverage”. Could this be the same deal? Are higher rates hurting companies with too much debt relative to equity? Both of these factors could be a function of the market’s concerns about higher interest rates in the future.

But finally we get to the factor that has crushed many a hedge fund manager over the past decade. Value. Even though value has underperformed since the GFC, 2018 has offered no respite. In fact, the relative peformance of this strategy has accelerated to the downside.

Bloomberg defines “PORT US VALUE” by averaging the following fundamental metrics:

  • Book Value to Price

  • Cash flow to Market Cap

  • Net Income to Market Cap

  • EBITDA to Enterprise Value

  • Earnings to Price

  • Sales to Enterprise Value

You know – all those good things that go into determining the fundamental value of a company.

One might think buying cheap companies relative to the underlying business would be a good strategy, but that’s not what has been working.

Great. I have now shown that fundamentals don’t matter and that chasing the hot stock is all one needs to do to outperform.

But nothing lasts forever.

Let’s have a look at the of this phenomenon to get a sense of whether there are any signs of this trend changing.

First up, here is a long-term chart of the “Momentum” strategy.

The uptrend of the past couple of years is evident, but look at the recent action.

“Momentum” is no longer being rewarded quite as heavily, and in fact, during the latest equity market sell off, the stocks that had performed the best over the past year led the move to the downside.

Is this a change is trend? Or merely a pause to refresh?

Not sure.

And how about value?

No trouble defining a trend here. Value has dramatically underperformed growth for years.

And recently?

Yeah, value got a bid versus growth, but we are a long way from a change in trend.

Although I would love to be able to tell you that the days of “momentum” and a return to “fundamentals” are imminent, I have no such confidence.

Never told you I have any answers, but hopefully this helps explain a little bit of what’s been going on behind the scenes. If someone knows when this madness will end, please let me know. I would love to return to a market where chasing the hot stock no longer works…

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US Treasury Sells The First Ever 2-Month Bill: Here Are The Details

This morning, in addition to a rather mundane sale of $40.0 billion in 4-week bills, the Treasury sold its inaugural 8-week (2 month) bill, for the amount of $25.0 billion as the Treasury seeks innovative ways to plug the burgeoning budget deficit.

As a reminder, this is what the TBAC said when it introduced the 2-Month bill back in May:

Treasury intends to introduce a new 2-month bill later this calendar year. Treasury has had extensive discussions about the benefits of a 2-month bill offering with a variety of market participants, including the Treasury Borrowing Advisory Committee (TBAC).  Our analysis suggests that this new product will meet the needs of many investors, while also enhancing Treasury cash management, reducing operational risks, and helping us in our mission to fund the government at the least cost over time.

In the coming months, Treasury will further study operational details related to offering the 2-month bill for settlement on a date different from the traditional Thursday settlement date for Treasury bills, such as Tuesday.  Treasury will explore alternative ways to enhance liquidity of the 2-month bill, if it is offered on a different settlement date, such as moving the settlement date of an existing bill tenor so that it aligns with the settlement date of the 2-month bill.   

Reinforcing the need for a 2-month bill, the TBAC said this introduction would allow for smaller auction sizes in other tenors, “allowing for greater flexibility in funding future projected financing gaps.” Of course, it would also mean greater cumulative Bill issuance, and even more flattening pressure.

The TBAC’s conclusion:

  • Observed congestion around the current auction cycle creates capacity and potential operational risk.
  • This committee has previously recommended 25% to 33% of the financing gap to be funded with T-Bills. This is projected to significantly increase T-Bill auction sizes.
  • Heavy settlement volumes on Thursday has a negative impact on funding markets and increases Treasury’s concentration of funding risk.
  • Introducing a 2m point at a new settlement date can alleviate both problems – reducing supply per issue and per day.

So what did today’s first ever 2-Month auction reveal? Well, with the The WI trading at 2.170% for the 8-week bill, the inaugural $25BN auction priced on the screws, with a high yield of 2.17% (while also selling $40BN in 4 week bills) .

Some more details:

  • With $78.3BN in total bids for $25.0b in bills sold, the Bid to Cover for the 8-Week bill was 3.13x (vs 2.81x for the 4-Week).
  • Indirect bidders were awarded 22.9% (vs 23.5% for the 4-Week)
  • Direct bidders awarded 15.1% (vs 10.8% for the 4-Week)
  • Dealers were awarded 62% (vs 65.7% for the 4-Week)

The announcement:

A little more context: after a transition period, the 8-week bills will be announced on Tuesdays, auctioned on Thursdays, and settle on Tuesdays. As Oxford Economics notes, in order to enhance the liquidity of the issue, 4-week bill auctions will also shift to that schedule and will be reopenings of the 8-week bills.

The 8-week bills will maintain the current schedule of Monday announcements, Tuesday auctions, and Thursday settlements during the transition period, but will have a slightly shorter maturity and will mature on Tuesdays. From November 8 to December 3, the 4-month bill will be announced as reopenings of the 8-week bill, and the 4-week bills during that time will also have a slightly shorter maturity and will mature on Tuesdays.

Source: Oxford Economics

In light of the strong demand for this – and any paper – it does not seem that the Treasury will have any problems maintaining or raising supply at this tenor, and before it’s all over, we may get 4 Month, 5 Month, 7 Month – you get the picture – Bills as the US now finds itself staring into a debt funding abyss over the coming years.

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Trump Vows To Go After “Horseface” Stormy Daniels And Her “3rd Rate Lawyer” Avenatti

President Trump on Tuesday vowed to go after “Horseface” Stormy Daniels and her attorney Michael Avenatti, after a federal judge dismissed her lawsuit against Trump on Monday, ordering her to pay his legal fees. 

Trump tweeted on Tuesday morning: “Federal Judge throws out Stormy Danials lawsuit versus Trump. Trump is entitled to full legal fees.” @FoxNews Great, now I can go after Horseface and her 3rd rate lawyer in the Great State of Texas. She will confirm the letter she signed! She knows nothing about me, a total con!

Following the dismissal of Daniels’ case (real name Stephanie Clifford), Trump’s legal team issued the following statement: 

United States District Judge S. James Otero issued an order and ruling today dismissing Stormy Daniels’ defamation lawsuit against President Trump. The ruling also states that the President is entitled to an award of his attorneys’ fees against Stormy Daniels. A copy of the ruling is attached. No amount of spin or commentary by Stormy Daniels or her lawyer, Mr. Avenatti, can truthfully characterize today’s ruling in any way other than total victory for President Trump and total defeat for Stormy Daniels. The amount of the award for President Trump’s attorneys’ fees will be determined at a later date.

Daniels’ attorney Michael Avenatti responded to the dismissal, tweeting: “We will appeal the dismissal of the defamation cause of action and are confident in a reversal,” while stating that Daniels’ other claims against Trump and Cohen “proceed unaffected.” 

Re Judge’s limited ruling: Daniels’ other claims against Trump and Cohen proceed unaffected. Trump’s contrary claims are as deceptive as his claims about the inauguration attendance.

We will appeal the dismissal of the defamation cause of action and are confident in a reversal.

— Michael Avenatti (@MichaelAvenatti) October 15, 2018

Last week Trump’s legal team argued that it made no sense for them to keep fighting in court over a $130,000 hush payment received by Clifford, also known as Stormy Daniels, as she invalidated the non-disclosure agreement she signed with Trump’s longtime fixer and lawyer, Michael Cohen. 

The lawsuit is moot because Trump has consented that the agreement, as she has claimed, was never formed because he didn’t sign it and he has agreed not to try to enforce it, Trump said in his court filing. The company created by Cohen to facilitate the non-disclosure agreement, which initially said Clifford faced more than $20 million in damages for talking, said in September that it wouldn’t sue to enforce the deal. –Yahoo

Will Twitter ban Trump for violating their new rules against “language that treats other as less than human?” 

Twitter’s Dehumanization Policy

You may not dehumanize anyone based on membership in an identifiable group, as this speech can lead to offline harm.

Definitions:

Dehumanization: Language that treats others as less than human. Dehumanization can occur when others are denied of human qualities (animalistic dehumanization) or when others are denied of their human nature (mechanistic dehumanization). Examples can include comparing groups to animals and viruses (animalistic), or reducing groups to a tool for some other purpose (mechanistic). –Twitter 

The aristocrats! 

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3,000 Hondurans Make New Run For US Border; Trump Threatens To Cut Aid If Not Stopped

An estimated 2,500 – 3,000 Honduran migrants crossed into Guatemala on Monday for a second northbound trek to the US border in six months, following a tense standoff with police in riot gear. 

Rows of Guatemalan police in black uniforms, some wearing helmets and shields, initially blocked migrants from reaching a customs booth, Reuters images showed. It was not clear how long the standoff lasted, but the group was ultimately able to cross, said march organizer Bartolo Fuentes, a former Honduran lawmaker.

A police official on site said all Central Americans could pass freely through the region as long as they complied with migration control. –Yahoo!

“We’re going to drop in on Donald Trump. He has to take us in,” said 24-year-old Andrea Fernandez, who left Honduras with a newborn baby, a 5-year-old daughter and 7-year-old son because she said she could not find work and feared for their safety.

The caravan’s attempt to seek asylum in the United States will spotlight President Trump’s hardline immigration stance right ahead of midterms – as images of sobbing mothers and their malnourished children are sure to dominate headlines, should the group make it to the southern US border. 

President Trump on Tuesday threatened to cut off roughly $175 million in annual aid to Honduras if their government doesn’t stop the caravan’s progression. 

“The United States has strongly informed the President of Honduras that if the large Caravan of people heading to the U.S. is not stopped and brought back to Honduras, no more money or aid will be given to Honduras, effective immediately!” tweeted Trump. 

Vice President Mike Pence called on presidents in the region to control the migrants, offering economic help and development in return. 

Meanwhile, the US Embassy in Honduras said in a Sunday statement “We are seriously concerned about the caravan of migrants traveling north from Honduras, with false promises of entering the United States by those who seek to exploit their compatriots.” 

Guatemala says that they have not promoted or endorsed any “irregular migration,” while many have noted the potentially political timing of the new caravan: 

On Friday the Washington Post reported that the Trump administration is considering using family separation as a way to discourage people from illegally entering the United States. On Saturday, President Trump told reporters: “We’re going to do whatever we can do to get it slowed down,” adding “If they feel there will be separation, they don’t come.“

Meanwhile former acting Director of Immigration and Customs Enforcement (ICE) Tom Homan told Fox‘s Laura Ingraham on Monday night that the US should expect weekly caravans of illegal immigrants at the southern US border if Democrats take back control of the House this November. 

“If the Democrats take control of the House, this caravan issue is going to happen every week. It’s just going to keep coming, Homan said, adding: “It should be the biggest issue we’re talking about. And I hope the voters are paying attention to what’s happening.” 

“If there’s no consequence, no deterrence to illegal activity, why would it stop?” he asked. “President Trump has the right ideas. We need the Republicans in Congress to back him up. We need some changes. We know how to fix this. We just got to have to have the willpower to fix it. And the Democrats don’t have the willpower or desire.” (h/t Daily Caller)

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Trader Warns “Markets Are Less Calm That They’re Letting On”

“Where is everyone?” asks former fund manager and FX trader Richard Breslow as trading volumes across equity, debt, and FX markets remain lackluster to say the least, amid an optimistic bounce (so far) today.

Once again, stocks are all hovering at their all-important moving-averages unable to break up, or down, for now, despite all the headlines proclaiming the worst is over…

One thing that caught my eye this morning was news about the submission of the Italian budget to the European Union. A positive development, for a change. Assets rally as political tensions ease. Yields all along the BTP curve are lower and equities are having a solid up day. And then I got to the kicker. Trading volumes in futures are running at about 50% of their 10-day average. That’s too much movement on thin air. And while the direction is positive, it suggests there are enough traders showing skepticism and just staying away.

Looks healthy on the outside, queasy on the inside. Yet Italian asset strength is being credited with lightening the mood across European markets.

Via Bloomberg,

It’s one thing to accept that Italy is a fairly unique case. Caution can reasonably be expected. Everything is but one headline away from sharp reversals. But how does that explain a general dearth of participation generally? As our London team reported, the flows in the major foreign exchange currencies have been thin, with the occasional large piece of business having an outsized effect. Choppy has been the word of the day to describe the price action.

If traders are being cautious in spot trading, maybe they’re expressing their views by using options? No, not there either. Volume in that space is barely reaching 70% of normal. A look at equity markets portrays a more mixed picture, but the story is largely the same. And it doesn’t seem to have mattered whether you are talking Japanese shares, which were up nicely, or Chinese markets that suffered through another disappointing day.

Even Treasuries, so much in vogue of late, can’t bring out the volume. Here we have the 10-year yield holding resistance at 3.15% and it doesn’t even feel like a battle is being waged.

So where is everybody? Wasn’t the fourth quarter supposed to be when traders were going to jump in and ride year-ending trends to victory?

It turns out that two factors have combined to throw a wrench into those plans. Confusion and uncertainty are rife, and fear of loss has gained the upper hand over greed. That’s a prescription for very unhealthy markets with informational content that should be consumed with care.

It’s hard to get overly worked up by normal economic numbers and even nascent trends when in the back of everyone’s minds there are big issues that can’t be handicapped. How do you trade emerging markets when you’re not even sure of how tenuous is the relationship between the world’s two biggest economies? Therefore you get daily and weekly swings based on just the latest news, such as it is, on volume that screams of lack of conviction. And meandering ranges for months at a time. Although, you wouldn’t really know it given the supreme confidence expressed in so many commentaries.

Probably the best way to describe these markets is that they are in a holding pattern. Up one day, down the next. Brexit is solved today, a mess tomorrow. There are too many shoes waiting to be dropped. And it is clear that ranges or not, no one is convinced things are at all stable.

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Turkey Finds ‘Evidence’ Missing Journalist Was Killed Inside Saudi Consulate: AP

Turkish investigators have only just finished searching the home of the Saudi Arabian consul in Istanbul – a home that was, according to surveillance footage, the destination of a car with diplomatic plates suspected of spiriting the remains of journalist Jamal Khashoggi out of the country’s consulate – and already the Associated Press is reporting that investigators found “evidence” that Khashoggi, a Saudi insider-turned-dissident who occasionally wrote columns for the Washington Post, was murdered inside the Saudi consulate in Istanbul.

Here’s more from the Associated Press:

A high-level Turkish official says police have found “certain evidence” during their search of the Saudi Consulate showing that Saudi writer Jamal Khashoggi was killed there.

The official did not provide details on the evidence that was recovered during the hourslong search at the diplomatic mission that ended early Tuesday.

The official spoke to The Associated Press on condition of anonymity because he was not authorized to speak publicly about the investigation.

Turkish officials say Saudi agents killed and dismembered the writer at the Saudi Consulate in Istanbul on Oct. 2. Saudi Arabia previously called the allegation “baseless,” but U.S. media reports suggest the Saudis may soon acknowledge Khashoggi was killed there, perhaps as part of a botched interrogation.

This should probably go without saying, but Turkish Foreign Mevlut Cavusoglu chided the Saudi Arabians on Tuesday, saying that interrogations shouldn’t be held at consulates.

He added: “Consulates aren’t places to hold interrogations. Interrogations should take place in courts, (by) judiciary authorities.”

Meanwhile, Turkey said the Saudis have not admitted to their role in Khashoggi’s death, contrary to media reports.

Foreign Minister Mevlut Cavusoglu also said on Tuesday that Saudi Arabia hadn’t offered any confession to Turkey over its alleged involvement in the disappearance and feared slaying of Saudi writer Jamal Khashoggi.

Asked about a New York Times report that Saudi Arabia might say Khashoggi was killed in an interrogation gone wrong, the minister said: “We have not received such information.”

Meanwhile, Secretary of State Mike Pompeo was all smiles at a meeting with Saudi Crown Prince Mohammad bin Salman:

Pompeo

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US Job Openings Hits Record High: 1.2 Million More Job Vacancies Than Unmployed Workers

The US labor market continues to grow at a blistering pace.

According to the BLS, in August the number of job openings in the US hit a new all time high of 7.136 million, up from July’s prior upward revised record of 7.077 million.

More importantly, August was the fifth consecutive month in which total job openings surpassed the number of unemployed Americans, which last month declined to 5.964 million. This means that there are now 1.2 million more job openings than unemployed Americans who are seeking a job (how accurate the BLS data is, is another matter entirely).

In other words, in an economy in which there was a perfect match between worker skills and employer needs, there would be zero unemployed people at this moment (of course, that is not the case.)

According to the BLS, the number of job openings was little changed for total nonfarm, total private, and government, while Job openings increased in federal government (+15,000). The number of job openings was little changed in all four regions

Adding to the exuberant labor picture, while job openings remained above total unemployment, the number of total hires also increased to a new record high, rising to 5.784 million in August from 5.713 million in July.  According to the historical correlation between the number of hires and the 12 month cumulative job change (per the Establishment Survey), either the pace of hiring needs to drop, or else the number of new jobs will rise significantly in the coming months.

Meanwhile, looking at the number of quits – the so-called “take this jobs and shove it” indicator – which shows worker confidence that they can leave their current job and find a better paying job elsewhere, revealed that one month after hitting an all time high, there was a modest, -31,000 dip to 3.577 million in August, further confirmation that Americans are increasingly confident in their job prospects should their part ways with their current employer.

Putting all this in in context:

  • Job openings have increased since a low in July 2009. They returned to the prerecession level in March 2014 and surpassed the prerecession peak in August 2014. There were 7.1 million open jobs on the last business day of August 2018.
  • Hires have increased since a low in June 2009 and have surpassed prerecession levels. In August 2018, there were 5.8 million hires.
  • Quits have increased since a low in September 2009 and have surpassed prerecession levels. In August 2018, there were 3.6 million quits.
  • For most of the JOLTS history, the number of hires (measured throughout the month) has exceeded the number of job openings (measured only on the last business day of the month). Since January 2015, however, this relationship has reversed with job openings outnumbering hires in most months.
  • At the end of the most recent recession in June 2009, there were 1.2 million more hires throughout the month than there were job openings on the last business day of the month. In August 2018, there were 1.4 million fewer hires

than job openings.

 

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Tether Peg Cracks (As Goldman Coin Starts Trading)

Via CoinTechs.info,

Tether Peg Cracks

The cryptocurrency market rallied on Monday after a crack in the tether stablecoin led to a surge in the price of Bitcoin. A fall of 3% in tether saw Bitcoin rallying from $6,300 to blow through previous resistance at $7,250 before settling lower on the day.

The move led to gains across the entire spectrum of digital currencies with only tether showing a loss amongst the top twenty coins. The sell-off in the USDT peg is the latest twist after a bout of rumours regarding the Bitfinex exchange and problems surrounding tether wire transfers.

Tether (USDT) is a token that its creators claim is backed 1:1 by U.S. Dollars, yet this has been questioned by traders in the past.

Despite spending the early years of crypto trading as the dominant stablecoin tether is now seeing some significant competition appearing on the horizon to take the throne. Binance have recently announced their backing for the $32 million Terra project, whilst the U.S. tech giant IBM have also backed a stablecoin project which will run on the Stellar network. The Gemini project, which was founded by the Winklevoss twins has also joined the recent stablecoin party with the arrival of the Gemini Dollar (GUSD).

Enter Circle

The real competition for tether may be seen with the arrival of Circle and its USDCoin (USDC), which started trading only a few weeks ago, which the company’s CEO stated was, “basically a dollar that operates on the blockchain.” The goal is to allow a stable bridge between buying and selling cryptocurrencies from standard bank accounts. The key difference with Circle’s offering is that the customers are required to hold $1 for every USD coin in order to provide price stability.

Why is Circle a company to watch? The company was seeded by investment banking titan Goldman Sachs. Never one to miss a bull market or dodge a bear market, Goldman joined a group of illustrious investors, including Accel, Baidu and the Chinese bank CICC in a $250 million financing round. Circle has made aggressive moves in the past months to acquire the Poloniex exchange, quickly adding new coins and alongside the USDC project the company has been putting the finishing touches on some retail products.

Not content with its plans to dominate the crypto space, representatives of Circle also found time to attend a cryptocurrency roundtable hosted by Congressman Warren Davidson at the end of September as lawmakers seek to get control over the nascent financial revolution. Is it possible that Goldman Sachs sees imminent crypto regulation and a flood of retail and institutional money appearing in the space? And is it a coincidence that the tether peg is starting to crack only weeks after the arrival of Circle’s own USD stablecoin?

Show us your dollars

Coincidence or not, tether is now backed into a corner and may be forced to show their hand on the claims that they hold enough assets to back the $2.25 billion market cap that sees the coin hold seventh spot in the cryptocurrency list. A refusal to do so may see an exodus to new stablecoins and a potential rout in the stablecoin. Tether have since released a statement to reassure investors that the dollar reserve, “…remains in surplus of the 1:1 backing of USDT and has more than the necessary currency on deposit to redeem all existing tethers.”

I don’t think they know how this game works!

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