Aurelia Butler

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    in Economy

    Kashkari backs higher for longer rates amid doubt on whether policy is restrictive

    “The biggest uncertainty in my mind is how much downward pressure is monetary policy putting on the economy …  that’s an unknown, we don’t know for sure,” Kashkari said Wednesday during a a moderated discussion at the 2024 Williston Basin Petroleum Conference in Bismarck, North Dakota. “That tells me we probably need to sit here for a while longer, until we figure out where underlying inflation is headed,” he added. The current level of interest rates of 5.25% to 5.5% would normally be restrictive enough to slow the economy and inflation, but due pandemic-related distortions including a huge wave of fiscal spending, stimulus checks and other supportive measures have made the economy more resilience than the Fed had expected. “It seems like there is more resilience in the economy than I had expected,” Kashkari added. Because of some of these dynamics, these interest rates only really mean we’re putting one foot on the brake and not two.” The remarks arrived just hours after the economic data showed the consumer price index slowed more than expected last month following three months of upside surprises. The slowdown in consumer prices came a day after a producer price inflation came in hotter than expected. But on the heels of the hot producer price report, a “cooler-than-expected consumer price report has immediately eased concerns of rapidly rising inflation, fueling investors’ hopes for rate cuts in the coming months,” Stifel said in a Wednesday note. More

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    in Economy

    US fines Volaris up to $300,000 for violating tarmac delay rules

    WASHINGTON (Reuters) -The U.S. Transportation Department said Wednesday it had fined Mexican carrier Volaris Airlines up to $300,000 for violating federal law on airport tarmac delays.Federal law and government regulations prohibit tarmac delays of four hours or more on international flights without providing passengers an opportunity to deplane.The department said in 2021 and 2022, Volaris allowed two flights to remain on the tarmac for lengthy periods without providing passengers an opportunity to deplane in Houston and St. Louis. Volaris will pay $150,000 of the fine and must pay the other $150,000 fine if it violates the tarmac rules within a year. The U.S. Department of Transportation (USDOT) has issued a number of similar fines to other carriers in recent years.Volaris, which did not immediately respond to a request for comment, agreed to the penalty and told USDOT a series of events outside of its control combined to cause the tarmac delays and said it takes the rules seriously.”This enforcement action reflects our ongoing commitment to protecting consumers and holding airlines accountable,” Transportation Secretary Pete Buttigieg said in a statement.USDOT in January 2023 said it planned to seek higher penalties from airlines and others that broke consumer protection rules, saying they were necessary to deter future violations.In August, it fined American Airlines (NASDAQ:AAL) $4.1 million for unlawfully keeping thousands of passengers on the tarmac for hours, the largest-ever penalty for violating the rule.American told the department the delays were the result of exceptional weather events, and that the 43 impacted flights represented less than 0.001% of the approximately 7.7 million flights operated.In April 2023, USDOT imposed a $135,000 penalty on British Airways over a 2017 tarmac delay in which it failed to ensure the timely deplaning of passengers. More

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    in Cryptocurrency

    Some Bitcoin mining rigs to shut down amid price weakness, says BTIG

    Transaction fees, which spiked to about $128 immediately following the halving, have since stabilized back to the $3-$4 range. Bitcoin price remains relatively stable post-halving, averaging roughly $63,000, which represents a 45% increase year-to-date, BTIG notes.That said, global hash rates have decreased by about 6% from April’s average of 624 EH to 585 EH in the first two weeks of May. This decline was expected to be between 5%-10% as less efficient mining rigs – those with efficiencies over 35 J/TH – unplugged. A more significant drop in hash rate could occur if Bitcoin prices decline further. Most public miners have cash breakevens in the $20,000-$40,000 range per Bitcoin, the report says.Earlier this year, several U.S.-listed miners reduced Bitcoin sales used to fund operations, opting instead to use equity for growth. “Many miners built their BTC inventories ahead of the halving,” noted BTIG, adding that Riot Platforms (NASDAQ:RIOT), Cleanspark (NASDAQ:CLSK), and Cipher Mining (NASDAQ:CIFR) sold only a small percentage of their Q1 2024 production, materially less than the 80-90% average in 2023. In contrast, Core Scientific Inc (NASDAQ:CORZ) and Bitdeer Technologies Group (NASDAQ:BTDR) continue to sell the majority of their Bitcoin to fund operating expenses.The three largest Bitcoin ETFs, which account for about 85% of ETF assets under management (AUM), saw a 38% increase in shares outstanding from mid-January to mid-March, during which Bitcoin prices peaked at $73,000. Since then, while Bitcoin prices have decreased by about 14%, shares outstanding in these ETFs have only risen by 1%. “While ETF fund flows look to have supported the BTC price earlier this year, arguably more important was the halving,” BTIG analyst explained.The global hash rate is expected to continue its downward trend through the summer, potentially bottoming out in August due to high power prices in Texas, which are projected to average $140/MWh in the summer months. “We expect global hash to remain under pressure, most likely bottoming in August,” said CFA at BTIG. Looking ahead to 2025, power prices are expected to stabilize at around $55/MWh, with another spike anticipated next summer.Large-scale mergers and acquisitions in the Bitcoin mining industry may not be imminent, but smaller acquisitions are expected. Cleanspark’s recent acquisition of 75 MW at $250,000/MW sets a precedent, with other miners likely to pursue similar bite-sized acquisitions. “The market remains bifurcated with companies that have access to capital in a position to grow while those less fortunate most likely selling owing to reduced revenues post the halving,” the report concludes. More

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    in Economy

    Is Fed in a big hole? BofA’s survey shows spending expectations are rising

    The bank said the findings revealed a significant increase in ‘New Vehicle’ spending expectations for the next 12 months.Specifically, 43.0% of respondents anticipated buying a new vehicle in May, up from 35.8% the previous month and 41.2% last year.“This is the highest level since Jan 2023 and showed the largest sequential improvement in all four big-ticket categories,” BofA’s team noted.“Plans to buy a New Home over the next 12 months have returned to 20%+ levels for the first time in twelve months and increased from 18.5% last month to 24.3% in May,” they added.Meanwhile, grocery remains the top category where over 35% of respondents expect to spend more in the next three months.Home Improvement & Renovations also saw over 30% of respondents in May expecting to increase spending in the next three months, representing a notable rise both sequentially and year-over-year. Home Furnishings experienced a sharp increase in spending expectations, from 23.33% in May 2023 to 27.10% in May 2024, BofA highlighted.In terms of inflation and promotion expectations, fewer than 65% of respondents continue to notice the most dramatic price increases in the Grocery category, down from 72.5% last year and 72.1% last month.Similarly, fewer respondents are noticing price increases at Restaurants/Bars.Intriguingly, about 42% of respondents in May have not noticed an increase in discounts or promotions, down from 49.4% last year and 49.9% last month. More

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    in Cryptocurrency

    Spot Bitcoin ETF: Here’s Why Vanguard Might Finally Join BlackRock

    Salim has quite a pedigree, and he joins Vanguard from BlackRock (NYSE:BLK), where his last role involved overseeing the launch of BlackRock’s iShares Bitcoin Trust (IBIT). On several occasions, Salim Ramji was caught expressing his perception of Bitcoin and the need to embrace new technologies on all fronts.BlackRock’s IBIT led the spot Bitcoin ETF inflows since the product’s inception in January. Notably, Ramji has seen the potency of the product, and he might help overhaul how Vanguard embraces the product moving forward. The anti-Bitcoin culture at Vanguard is striking. Besides refusing to join the host of applicants for spot Bitcoin ETFs, the company also discontinued support for its trading on all of its supported platforms. Former CEO Buckley even hinted that the firm’s position against Bitcoin will outlive his tenure, adding a unique twist to the conversation.Major financial giants in the country and abroad are joining the Bitcoin ETF bandwagon. Besides BlackRock, top banks like Morgan Stanley and UBS have unveiled their exposure to the asset class. Besides these two, top trading firm Susquehanna International Group has also revealed that it holds up to $1 billion spread across several spot Bitcoin ETF issuers.Entities in Canada and Hong Kong have also unveiled disclosures on Bitcoin through recent 13F filings with the U.S. SEC. With these trends, it becomes evident that there is a major shift to these products, complimenting MicroStrategy’s aggressive accumulation spirit. While Vanguard is not losing out on the Bitcoin ETF hype, with Ramji as head of Vanguard, he might be unwilling to let go of the opportunity to invest in BTC.This article was originally published on U.Today More

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    in Cryptocurrency

    Billionaire Mike Novogratz Makes Epic BTC, ETH, SOL Market Prediction

    Consolidation is characterized by assets moving sideways within a certain range, indicating equilibrium between buyers and sellers. Novogratz believes that this might be the current phase for cryptocurrencies such as Bitcoin, Ethereum and Solana, which have seen significant volatility in recent months. The consolidation phase could be a precursor to the next bull run, depending on various market factors.Novogratz predicts that Bitcoin, the biggest cryptocurrency by market capitalization, may be stuck in the $55,000 to $75,000 range for the time being. “We are in the consolidation phase in crypto. Bitcoin, Ethereum and everything else, Solana will consolidate, what does that mean? It means probably somewhere between $55,000 and $75,000 until the next set of circumstances, the next set of market events bring us higher,” Novogratz said on a conference call, according to Bloomberg. The cryptocurrency market has remained static since the record bull run in the previous two quarters, which was fueled by the launch of spot U.S. Bitcoin exchange-traded funds and the Bitcoin halving event. Bitcoin, however, fell as confidence about the Federal Reserve’s interest rate cuts faded due to continually strong economic readings.Novogratz stated that the cryptocurrency market experienced many tailwinds in Q4 and Q1. A cool-off may be likely in the present quarter; however, this might change in the next quarter if certain factors, such as Fed rate reduction, come into play.In the most recent indication of the U.S. economic outlook, Fed Chairman Jerome Powell stated that the U.S. economy is operating well and has a robust labor market. Inflation in the United States did not rise further in the first quarter. Uncertain if inflation will continue, Powell hinted that raising interest rates might not be the next step, but they are likely to remain steady.This article was originally published on U.Today More

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    in Economy

    What even is inflation?

    Standard DigitalWeekend Print + Standard Digitalwasnow $85 per monthBilled Quarterly at $199. Complete digital access plus the FT newspaper delivered Monday-Saturday.What’s included Global news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts20 monthly gift articles to shareLex: FT’s flagship investment column15+ Premium newsletters by leading expertsFT Digital Edition: our digitised print editionWeekday Print EditionFT WeekendFT Digital EditionGlobal news & analysisExpert opinionSpecial featuresExclusive FT analysisFT Digital EditionGlobal news & analysisExpert opinionSpecial featuresExclusive FT analysisGlobal news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts10 monthly gift articles to shareGlobal news & analysisExpert opinionFT App on Android & iOSFT Edit appFirstFT: the day’s biggest stories20+ curated newslettersFollow topics & set alerts with myFTFT Videos & Podcasts20 monthly gift articles to shareLex: FT’s flagship investment column15+ Premium newsletters by leading expertsFT Digital Edition: our digitised print editionEverything in PrintWeekday Print EditionFT WeekendFT Digital EditionGlobal news & analysisExpert opinionSpecial featuresExclusive FT analysisPlusEverything in Premium DigitalEverything in Standard DigitalGlobal news & analysisExpert opinionSpecial featuresFirstFT newsletterVideos & PodcastsFT App on Android & iOSFT Edit app10 gift articles per monthExclusive FT analysisPremium newslettersFT Digital Edition10 additional gift articles per monthFT Weekend Print deliveryPlusEverything in Standard DigitalFT Weekend Print deliveryPlusEverything in Premium Digital More

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    in Economy

    Wallet recovery firms buzz as locked-out crypto investors panic in bitcoin boom

    (Reuters) – The recent surge in bitcoin prices has the phones at crypto wallet recovery firms ringing off the hook, as retail investors locked out of their digital vaults make frantic calls to regain access to their accounts.Cryptocurrencies exist on a decentralized digital ledger known as blockchain and investors may opt to access their holdings either through a locally stored software wallet or a hardware wallet, to avoid risks related to owning crypto with an exchange, as in the case of the former FTX.Losing access to a crypto wallet is a well-known problem. Investors forgetting their intricate passwords is a primary reason, but loss of access to two-factor authentication devices, unexpected shutdowns of cryptocurrency exchanges and cyberattacks are also common.Wallet passwords are usually alphanumeric and the wallet provider also offers a set of randomized words, known as “seed phrases”, for additional security – both these are known only to the user. If investors lose the passwords and phrases, access to their wallets is cut off.With bitcoin prices regaining traction since last October and hitting a record high of $73,803.25 in March, investors seem to be suffering from a classic case of FOMO, or the fear of missing out.Reuters spoke to nearly a dozen retail investors who had lost access to their crypto wallets. Six of them contacted a recovery services firm and managed to regain access to their holdings. “What would be driving this trend is the fact that bitcoin prices are at $60,000, not $30,000… it’s just pure economics,” said Steve Sosnick, chief strategist at Interactive Brokers (NASDAQ:IBKR).”People who are missing their crypto for one reason or another, or those who don’t have access to their crypto, are very much incentivized to get it back.”The world’s largest cryptocurrency has surged 161% in the past two quarters, on hopes of a cut in interest rates by the U.S. Federal Reserve and optimism around the launch of spot bitcoin exchange-traded funds (ETFs).BOOM IN RECOVERY REQUESTS A Switzerland-based firm that uses Nvidia (NASDAQ:NVDA)’s graphic processing unit cards to run artificial intelligence models to access stranded wallets saw requests jump tenfold in the first quarter, compared with the year-ago period.”We have seen a spike (in requests to unlock wallets) every time the price changes dramatically,” said a top executive at the firm who did not want to be named.ReWallet, a Germany-based wallet recovery services provider, saw a 334% jump in requests in the previous quarter and logged a record-high number of requests in early March, when bitcoin prices touched an all-time peak.The firm estimates that about 20% of the total 19 million bitcoins in circulation, as of March 13, are likely inactive and now worth around $237 billion.U.S.-based Wallet Recovery Services saw a 30% bump in requests this year as of mid-April. Recovery services provided by firms do not come cheap. ReWallet and WRS charge a 20% fee on the wallets’ contents, with the caveat being they get paid only upon retrieval. INVESTORS’ WALLET RECOVERY ATTEMPTS”I was simply worried that I would no longer have access (to my wallet) and thus lose my bitcoins forever,” said an investor living in Germany, who declined to be named. “Of course, the high bitcoin price was an incentive to finally tackle this.” Another Switzerland-based investor, who also requested anonymity, said, “I had secured the wallet with passphrases and couldn’t remember it. I tried again and again and created various lists with possible alternatives, but unfortunately without success.”Recounting ReWallet’s retrieval of his bitcoin holdings, now worth over $300,000, he said, “It was an indescribably great feeling. I’m retiring in one-and-a-half years and I now feel financially well positioned.”Speaking about investors’ struggles, Ralf Wintergerst, chief executive of German security technology firm Giesecke+Devrient said, “Looking ahead, there is a growing trend towards solutions that mitigate the key management problem inherent in self-custody.” “This could entail the use of multi-signature wallets, or other decentralized recovery mechanisms to distribute responsibility and enhance security.” More