Just as the Asian epicenters of COVID-19 seemed like they were finally putting the virus behind, the tally of confirmed infections has started to spike. The NBA season was suspended after Rudy Gobert’s case, Canadian PM Justin Trudeau working from home after wife tests positive, the pope caught a cold and had Vatican City on lockdown, Iranian Vice President and two ministers have tested positive alongside the death of two lawmakers. Meanwhile the POTUS and his VP Mike Pence refuse to be tested or quarantined after spending an evening with a Brazilian presidential aide confirmed to have been infected at the time saying “there is no need.” He also slipped in a travel ban for non-Americans flying from Europe blaming the Europeans for the epidemic.
The virus has a running mortality rate of less than 4% vs. 34% for MERS (’12) so it is not the end of the world if you are infected. Having said, the combination of precautionary measures, social media blowing it out of proportion and the associated supply chain disruptions are translating into very real jitters in the screens.
The markets seem to be in the middle of a perfect storm… Additionally, the spat between Saudi Arabia & Russia has caused crude oil to collapse to 4yr lows (and potentially ending OPEC) with approximately $86bn in debt maturing for the US fracking industry in the coming years.
And its not like the Fed has much room to wiggle. the emergency 50bp rate cut has brought down the target rate to 3yr lows while 10yr yields swim under 0.9%… they are running out of tricks to pull out of the hat and to add insult to injury, ECB left rates unchanged overnight wrapping that Gavel up with a “we are not here to close spreads”… Italian 5y CDSs have blown out.
The macro indicators do not paint a pretty picture…
US PMI
China NBS Manufacturing PMI
VIX at 11yr highs…
S&P 500 P/E 20.6 (never holds 20+ levels)
Bitcoin wasn’t swinging for the fences but until two days ago, was trading well within the 10month trading range but that all changed overnight as towels were thrown in with loss cuts further exacerbating the meltdown. Looking for a floor at $5k but no conviction that it’ll hold at this point.
Justin Sun’s failed STEEM -11.9% heist has caused some serious blowback from the community less than a month after the Tron Foundation proposed to move Steem & other Steem dApps onto the Tron Blockchain (-31.9% since Feb 14th). Hardly surprising as Sun labelled the incumbents as hackers but this incident goes to show that Proof of Stake- deemed by many to be successor of Proof of Work- has flaws of its own with gaping questions surrounding staking rewards, super nodes and overall governance. Ousted witnesses have since been reinstated, Exchanges apologized for mobilizing users’s STEEM voting rights while Sun continues to justify his actions.
India’s Supreme Court ruled the Reserve Bank of India’s blanket ban “disproportionate” and while the RBI has challenged the verdict, the crypto outfits — hitherto locked out from the country’s banking rails- have already announced payment rails, some just hours after the ruling providing 1.4bn people with access to legitimate means to trade. The proposed partial amendment was passed by the Korean National Assembly however, is unlikely to lead to any fireworks. The bill merely adopted the FATFs vocabulary, included crypto dealings in various “financial transactions” and AML requirements now explicitly the onus of the virtual asset exchanges. However there is no Enforcement Decree and the local sentiment is that there will never be one under the current regime (Moon’s term ends May 22nd, 2022). Case in point, banks are yet to open accounts for VASP’s users. Over the course of the week, the French courts punched in a milestone by ruling bitcoin a “fungible intangible asset” a.k.a. fiat, Nigerians now have an alternative to a crumbling Naira (NGN) and elected Ukranian officials are required to report their crypto holdings.
Spencer Dinwiddie seems to have won over the league and convinced them that its actually none of their business what he does with his contract. Surely this is the beginning of many more…
- Lloyds launches GBP1,000 micro-insurance policies for cryptocurrency wallets.
- France rules bitcoin as a “fungible intangible asset” a.k.a. fiat
- Samsung inks partnership with Credorax for bank settlement solution
- Algorand ($ALGO) -34% to power Marshall Islands’ Digital Currency.
- Binance adds support for Nigerian Naira (NGN)
- Chengdu University of IT becomes first Chinese university offering Blockchain Engineering majors.
May the trend be your friend… Happy Trading!
