Gold holds above a key support level in light of rising interest and yields
Gold continues to trade in an extremely narrow range as the precious yellow metal reacts to two opposing forces; rising interest rates and inflation. However, the recent price declines in gold have been shallow and short-lived at best. Most importantly, gold prices have held above a key support level which is Fibonacci based. The data set used for this Fibonacci retracement set contains a long period of data. It begins at $1678 which is the low created in August 2021, up to this year’s highest value of $2077. This data set covers a price range of approximately $400.
Chart number one is a daily chart of the continuous contract of gold futures. It currently is representing the most active August 2022 contract. After hitting this year’s high in March what followed was a deep correction moving gold from $2077 to $1785. Gold dropped a total of $292 or 15.12% in approximately 2 ½ months. This correction was directly attributable to market participants' focusing on dollar strength the result of rising interest rates and yields.
What followed after gold hit $1785 was an initial rally up to $1881 finding resistance at the 50-day moving average and then correcting to approximately $1807 before forming a base and regaining some value.
Chart number two is a daily candlestick chart of gold which has been enlarged to detail the most recent price activity. Today gold traded to a low of $1830.70 which is $0.10 above the 61.8% Fibonacci retracement. It is widely recognized amongst technical traders that a deep acceptable correction will typically go to the 61.8% Fibonacci retracement and begin to move higher reigniting the rally which occurred before the correction.
If gold can hold above the key support level of $1830 it will find minor resistance at the 200-day moving average which is currently fixed at $1843.20. Above the 200-day moving average, the next resistance level gold could encounter if it continues to rise from this price point is approximately $1860 which is the high achieved on both Thursday and Friday of last week. Major resistance is currently fixed at $1872.60 which is based upon the shortest term 50-day moving average.
If gold futures can hold $1830 it will either form a foundation at this price point and consolidate, or start a new rally from this base. With the next FOMC meeting scheduled for the end of July, market participants will prioritize their focus on inflation. If inflation continues to run hot, we can expect to see gold move to higher pricing. However, if inflationary pressures begin to abate, we could expect to see gold continues to be pressured resulting in lower prices. I believe that inflation will continue to run hot and continue to be not only persistent but elevated.
by Jeff Thomas, editor, International Man Communique
In the 18th century, America was made up primarily of people who, of necessity, had had to work hard. Had they not taken full responsibility for their own welfare, there was no one else to do it for them and they would have starved. As this was the case, anyone who did arrive on American shores who were unwilling to work and wanted others to provide for him could expect to find no sympathy and might well starve.
In the 19th century, the former colonies had become the United States. Expansion was underway and the young people of the 18th century became the entrepreneurs of the 19th century. In order to continue to get the menial tasks accomplished, millions of immigrants were needed. Those who were welcomed were those who were prepared to start at the bottom, often live in poor conditions, receive no entitlements, and compete for even menial jobs. If they accepted these terms, they received the opportunity to immigrate and work.
Also, in the 19th century, the US expanded to the West coast, covered the nation with railroads, and created the industrial revolution – the greatest period of expansion in US history.
In the 20th century,income tax was implemented, the Federal Reserve took over the dollar and the "New Deal" Introduced the concept of entitlement. It was a mixed century of wealth generated by the industrial revolution, fighting against the new concept of entitlement.
In the 21st century,immigrants in large numbers were again encouraged to come in. However, unlike in the 19th century, they were not encouraged on the basis of starting at the bottom, often living in poor conditions, receiving no entitlements, and competing for even menial jobs.
Quite the contrary. They not only were guaranteed welfare, schooling, and housing, they would not be required to work at all and, if they committed crimes, they were likely to be released without prosecution. They, in fact, were afforded privileges above that of American citizens.
Today, American conservatives are stating that immigration must be curtailed, as immigrants are inherently usurious. Conversely, liberals are stating that America was built on immigration and the way forward is to open the doors to all who wish to enter.
Both these assumptions are incorrect
It’s the most effective means of replacing those at the lower positions, as the existing workers move into higher positions. This has been the tradition since the formulation of the US.
The debate should instead be over which people are chosen to immigrate.
In every country, in every era, there are always some people who understand work ethic and responsibility. They are the producers. There are also always some who have no desire to work or otherwise take responsibility for themselves. They are parasites.
In the 19th century, this simple principle was understood, and every single immigrant recognized that, if he wasn’t prepared to work and take responsibility for himself, he might well starve. That being the case, those who left their home countries to migrate to America were, of course, producers. (The parasites never even got on the boat.)
But in the 21st century, the US government supports the collectivist concept that potential immigrants must be offered more entitlements than they ever had at home, even to the point that they’ll have rights that Americans don’t have.Of course, the people who come will not be the producers. They will be the parasites.
So, let’s do a comparison:
Producers:
Prepared to start at the bottom
Prepared to work hard enough to better themselves
Prepared to take responsibility for their own well-being
Prepared to respect the laws of the host country
Prepared to have gratitude for the opportunity to better themselves
Parasites:
Reluctant to accept low-level jobs
Not prepared to work to better themselves
Expect others (the host government) to take responsibility for their well-being
Not prepared to respect the laws of the host country
Expect to never be satisfied, no matter what level of privilege they’re afforded
Once the above is put in perspective, the reader must then accept that his government is not only not doing what’s good for his country, he’s doing the exact opposite of what’s good for his country.
And, then, of course, he must ask, "Why?"
There are two possible answers. It may be that the political leaders of the US are quite delusional – to the point that, whilst they may be patriotic, they fail to understand the simple equation of worker mentality.
Or it may be that the political leaders thoroughly understand that the mass immigration of parasites is destructive for their country, but also realize that such immigration increases their power level.
In Europe, this question is more easily answered. The same trend is taking place there, and the people of literally every country in the EU are calling loudly to stop the mass wave of parasite immigration, yet the EU itself is stubbornly insisting that the immigration not only continue, but expand.
Brussels knows full well that, if enough parasites enter the system and eventually receive the right to vote, they will always vote in favor of a central government that provides them with entitlements. Once their numbers substantially exceed 50% of all voters, the collectivist oligarchy in Brussels will become autonomous. Elections will become meaningless and power will remain with the Brussels elite permanently.
In America, of course, the veil has not fallen away from the government’s objective, to the degree that it has in Europe. Roughly half of Americans see the government program of parasite immigration as a moral imperative.
And, of course, both the government and the media are doing all they can to enforce this propaganda. They present parasite immigration supporters as "good people" and objectors as "bad people."
History is rife with examples of populations that were hoodwinked into believing that they were "good people" because they supported an idiotic precept that was, in fact, only intended to increase their government’s power over the people.
In all cases, this has ended badly and there can be little doubt that, when this one hits the history books, it will also be looked back on as a grave error in judgment.
New Opportunities Are Emerging For Citizens of The World.
Freedom and democracy may appear to be struggling to stay alive in America, but there may be a knock-out punch ready to be released. The evolution of the blockchain-enabled metaverse is going to enable the 'Citizens of the World' to gain their own Freedom by democratizing power and creating a new world with new rules, new players, and new opportunities. For 99.99% of us, the metaverse will improve our real-world lives through the democratization of power and opportunity.
Along with the major long-term trend of society towards decentralization and smaller-scale organizations, there are new opportunities developing to help 'Preparers' in the cryptocurrency sector. Businesses are beginning to issue their own Crypto Coins that can be traded on Cryptocoin Exchanges.
Markethive.com for example will be releasing its HiveCoin (HIV) in the coming weeks. It has tremendous upside potential that is outlined in a Video by Founder Tom Prendergast, "Entrepreneur Advantage…".
Not only that, if you go to their website and register as a FREE Member, you will be given 500 HiveCoins for "FREE" along with access to several Earning Opportunities and online tools to increase your HiveCoin balance.
Gold will shine bright as Bitcoin, cryptocurrencies collapse
The gold market is holding firm in relatively neutral territory, trading in a narrow range between $1,800 and $1,850 an ounce; however, some commodity analysts are optimistic that gold could see renewed investors' interest as sentiment in financial markets rapidly disintegrates.
Specifically, some analysts see gold finding new safe-haven demand as investors flee the cryptocurrency market.
In 2021, Bitcoin's rally to an all-time high of $65,000 an ounce took away some of gold's luster. Last year some analysts said that Bitcoin's rally reduced gold's market valuation by as much as $200. Many investors saw Bitcoin and other digital currencies as a better store of value than gold. However, sentiment is quickly shifting as Bitcoin dropped below $18,000 a token and Ethereum dropped below $900.
"I would argue this blow-up in cryptos reinforces the value of gold," said Kristina Hooper, Chief Investment Strategist at Invesco, in a recent interview with Kitco News, "There's really only one asset that historically has the qualities of being a hedge against inflation and geopolitical risk and it's not cryptos."
Many analysts have noted that cryptocurrencies have fallen in line with risk assets like equities as the Federal Reserve continues to aggressively tighten its monetary policy to slow the economy and cool down extraordinary inflation pressures.
Rising interest rates coupled with the plan to reduce its balance sheet have reduced the amount of liquidity in the marketplace impacting riskier assets. Bitcoin is down more than 70% from its 2021 all-time highs. Year-to-date, the digital currency is down more than 50%, even as prices bounce from Saturday's multi-year low.
But it's more than just bitcoin; few financial assets are doing well in the current environment. So far this year, the S&P 500 is in solid bear-market territory, down 23%. Even the traditional safe-haven U.S. bonds are down on the year. The yield on a 10-year note is trading well above 3% and are up more than 100% since January.
Gold hasn't lost its luster even as the Fed continues to raise rates – State Street's George Milling-Stanley
Robert Minter, Director of ETF Investment Strategy at abrdn, said that in the current environment, as interest rates and inflation rise, investors should look to have solid assets in their portfolios. While gold should always be part of a balanced portfolio, Minter said that he also likes base metals as they are even a better hedge against inflation.
"Bottom line is you want something real in your portfolio. You want something that if you drop it on your foot, it is going to hurt," he said.
George Milling-Stanley, Chief Gold Market Strategist at State Street Global Advisors, said that the selloff in Bitcoin proves it's just another risk asset.
"Gold is starting to look more and more, the last outlier. I expect gold to hold its value," he said. "There is a very good chance that as other assets fall, gold relative performance is going to look even better."
Michael Saylor Lists 10 Things For Bitcoin To Become A Stronger Asset
by Shawn Amick
In an interview with Bloomberg, Michael Saylor detailed 10 things that needs to happen over the next decade for bitcoin to become a stronger asset for institutions.
Michael Saylor recently appeared in an interview with Bloomberg to discuss bitcoin and regulation.
The CEO of MicroStrategy explained he believes bitcoin has 10 things it needs to become a stronger asset.
Saylor elaborated on his company’s bitcoin strategy and its 10-year horizon and plans to acquire more bitcoin.
Michael Saylor, CEO of the software analytics and pro-bitcoin company MicroStrategy, recently appeared in an interview with Bloomberg to discuss 10 steps he believes will make bitcoin a stronger asset.
“There’s about 10 things that have to happen over the next decade to make it [bitcoin] a better asset, and we kind of know what those 10 things are,” Saylor stated in the interview.
The first on the CEO’s list of issues to be addressed is the absence of a no wash-trading rule, allowing traders to harvest loss and gains in a way that cannot happen with traditional equities markets.
Then, Saylor mentioned the issues with the 520 unregistered and unregulated crypto exchanges offering 20x leverage, which often leads to unprotected investors taking massive losses.
Next, the 19,000 cryptocurrencies being cross-collateralized and associated with bitcoin currently hold bitcoin back by comparing it to badly managed, unregistered securities.
Moreover, the issue becomes worse as these securities are glorified by the next issue at hand, “wildcat banks,” which enable gammified practices offering unsustainable yield, such as was seen with the fall of the Terra ecosystem.
Not least of all, Saylor listed ignorance and fear of the asset class, as a lack of technical know-how still terrifies many, as does media coverage telling of the many supposed deaths of bitcoin.
However, the fear and uncertainty is not just for bitcoin as Saylor went on to explain that we currently do not have a real stablecoin, which he believes will be a major boon for the ecosystem once one is fully regulated and approved.
Then, the CEO closed his list noting the absence of a spot exchange-traded fund (ETF), which would allow institutions to interact with the asset of bitcoin without needing to touch it themselves.
Finally, the three remaining points that need to be improved on in the bitcoin ecosystem revolve around the lack of regulatory guidance and support institutions currently must overcome. These points include lack of insurance, as well as guidance in becoming involved with the space.
Prior to revealing his list of improvements that will launch bitcoin into its next bull-cycle, Saylor spent much of the interview justifying the bitcoin strategy of MicroStrategy during this recent downturn.
“We did a lot of backtesting and I’ve gone back and looked at the numbers,” Saylor explained. “On August 10, 2020 when we announced our $250 million bitcoin buy, since then, bitcoin is up 72%.”
He went on to compare it to some traditional assets over the same time period including: the NASDAQ (-2%) , gold (-9%), S&P 500 (+9%), and single-family homes (+26%).
“The bottom line is that the bitcoin strategy is 10x better than any other alternative,” Saylor concluded. “So, no. I don’t regret it.”
ProShares To Release ETF That Allows Investors To Short Bitcoin
by Shawn Amick
ProShares will release a new ETF allowing investors to short bitcoin during harsh market conditions enabling institutions to legally bet against the asset.
Proshares ETFs will release a new product which will allow investors to short bitcoin.
Proshares previously released the Proshares Bitcoin Strategy ETF that trades futures contracts as well.
Bitcoin reached its all time high days after its original ETF was released as this short ETF releases amid harsh market conditions.
Proshares, a provider of exchange-traded-funds (ETFs), is set to release the Short Bitcoin Strategy ETF (NYSE: BITI) on June 21, which will allow investors to bet against bitcoin through the use of futures contracts.
Investors choosing to purchase this ETF are seeking a return of -1x its underlying asset, in this bitcoin, within a single day. Should the investor choose to hold the ETF for longer than the target of one day, Proshares notes that due to rebalances and compounding returns, investors will likely experience a different result and direction.
On the other hand, Proshare’s previously launched an ETF for bitcoin, which provided access to futures contracts for the asset. On its first day of trading, the Proshares Bitcoin Strategy ETF (NYSE: BITO) traded over $1 billion of volume, marking the second-largest ETF release ever.
Shortly after the the release of Proshare’s original ETF, bitcoin surged to its all-time-high, close to $69,000. In comparison, Proshares has released this ETF allowing investors to short bitcoin as it endures a harsh market correction, which bottomed out around $17,800 and currently is fighting to hold $20,000.
Previously, the original ETF was launched to provide institutional and retail investors access to the asset without dealing with technical complications or legal hurdles. Similarly, the Proshares short ETF will provide institutions access to play towards negative sentiment without interfacing with those same hurdles in a compliant manner.
Thus far, regulatory conversations surrounding ETFs and bitcoin have been largely tumultuous. The Securities and Exchange Commission (SEC) has stalled approvals for spot-bitcoin ETFs, resulting in the deviation of some commissioners who say the agency has stalled too long.
In fact, Grayscale Bitcoin Trust – the largest bitcoin fund in the world – has recently hired a top legal mind to combat the SEC should the regulator continue to deny the company’s application to convert to a spot-ETF.
The crypto space faced another sharp selloff during the weekend as Bitcoin plunged below $18,000 and Ethereum dropped below $900.
The overall crypto market cap plummeted to $847 billion, down nearly 10% on the day. Bitcoin touched $17,677, the lowest level since November 2020, and Ethereum fell to a low of $893, the level last seen in January 2021.
"Bitcoin appears to be hanging on for dear life as cryptocurrencies remain in meltdown mode. The worst week since the early days of the COVID pandemic has widespread crashes across Bitcoin, Ethereum and Dogecoin," said OANDA senior market analyst Edward Moya.
At the time of writing, Bitcoin was at $18,633, down 74% from its November all-time high of $69,000, and Ethereum was at $948, down 81% from its November all-time high of $4,878.
The initial trigger behind the massive crypto drop in June was the macro environment. First, a surprising hot inflation number from May caught markets off guard, followed by a 75-basis-point hike from the Federal Reserve on Wednesday – the biggest rate increase since 1994.
The dramatic shakeout in crypto also garnered steam following contagion risks from within the crypto community itself after a lending company Celsius said it was halting all transactions on its platform. To learn more about that, click here.
After failing to hold several key support levels, analysts now watch a price area below the $14,000 mark.
"Bitcoin is sharply lower today after having accelerated to the downside following the breakdown from its consolidation phase. It is currently down about 14%, bringing its month-to-date loss to about 44%," said Fairlead Strategies founder and managing partner Katie Stockton. "The breakdown is unconfirmed (it has not spent enough time below to make it decisive), but it shows the risk inherent to risk assets right now. If we see consecutive weekly closes below $18.3K, risk would increase to next support below $13.9K."
Stockton added: "We do not recommend counter-trend positions, however, noting momentum is strongly negative."
During the first two weeks of June, investors have continued to position themselves defensively, and crypto's upside potential remains limited until stagflation fears subside, said Bank of America's global crypto and digital asset strategist Alkesh Shah.
"Although painful, removing the sector's froth is likely healthy as investors shift focus to projects with clear road maps to cash flow and profitability vs. purely revenue growth. The digital asset ecosystem is an emerging high-growth speculative asset class with tokens that are exposed to similar risks as tech stocks. The upside is likely capped until risks associated with rising rates, inflation, and recession are fully discounted," Shah said.
Dad’s don’t necessarily need special or fancy gifts, but Bitcoiners want to make sure our dads have the Bitcoin tools and gadgets they need.
Aside from relaxing on the couch with a cold beer, surrounded by family, dads don’t really need much. We already have our families. I say this as a father of three, with my wife of eight years recently giving birth to our third child.
If you think about it, most things will end up in the trash eventually. I like to refer to many of the toys we get our kids as presents as “future trash.” It’s an unfortunate by-product of the fiat society we live in. What’s a surefire way to keep earnings growing year over year? By making products that don’t last.
I’m not saying that this is even intentional; it’s just the current state of things. Cut costs at all cost. After years of iteration in this system, we’ve fundamentally changed from a production to a consumption society where products simply don’t last.
So instead of spending $100 or so on a thoughtful gift that is inevitably bound for the trash, why not think on a longer time frame? A low time preference gift, if you will. Go ahead and have the kids draw some pictures and paint some rocks, things I proudly display in my office, and save a few bucks for something that will last for a while.
Below are some Bitcoin-related gifts for different types of dads.
For The Low Time Preference Or Bitcoin-Curious Dad
The first thought that came to mind was basically just buying some bitcoin. A rough 33-times multiplier would take bitcoin to a million bucks, meaning a $100 bitcoin buy would become about $3,300. Assuming we’ve avoided a hyperinflationary catastrophe, that’s probably still a pretty solid vacation for you and the family.
Better yet, why not start an automatic bitcoin purchase with a solid bitcoin company like Swan or River. As little as $25 a week or month will do wonders for your purchasing power over time. As Michael Saylor likes to say, get yourself a slice of that prime digital real estate when it’s still affordable for normal people. At 21 million bitcoin to go around, there’s not even enough for all the millionaires in the world to own a whole coin. Start stacking for your favorite dad today.
If your dad hasn’t actually interacted with bitcoin yet, I would recommend a small gift of bitcoin from the local Bitcoin ATM. In order to claim the bitcoin gift, he’ll be forced to set up a wallet and potentially complete a transaction to cash out, letting him see how the network actually runs.
Even if your dad ends up selling, he’ll get some familiarity with the network, have experience with a wallet, and have to create an account at an exchange like River that he can go back to when he realizes that he made a terrible mistake.
But for the dad who wants to treasure his new gift of bitcoin, I recommend starting with a wallet. For wallets, I really enjoy BlueWallet. You can even help him set up a multisig solution using only a combination of cell phones.
I also recently encountered a cool idea to help the less technically inclined to save in bitcoin and manage their private keys. The idea came from one of my Bitcoin buddies, who published an article about gifting his parents bitcoin using a Ballet physical wallet. The basic idea being the bitcoin wallet existing as a single solution physical card. This method requires a relatively high degree of trust in the manufacturer, so I wouldn’t necessarily recommend storing your life savings with it, but it could serve as a nice way to get someone into Bitcoin.
For The Sovereign Individual Dad
If your dad is already a Bitcoiner, it might help to get them a hardware wallet and some key backup hardware to help secure their sovereign stack. Even if they already have one, there are always new developments in technology leading to greater usability and security. The Coldcard is a classic choice with tons of functionality. Coinkite actually just came out with an updated version, the Mk4, which can give your favorite dad a chance to experiment with different security protocols to throw off would-be attackers.
Conveniently, Coldcard is one of the hardware devices which is supported by managed multisig providers like Casa and Unchained Capital. Security doesn’t have to be intimidating anymore. Unchained will even help your dad set up a self-directed IRA to convert his retirement account into unconfiscatable, tax-advantaged capital to help him in his transition to a better tomorrow. Unchained also supports bitcoin-collateralized lending so he doesn’t even have to sell!
Both institutions also support more user-friendly devices like Trezor and Ledger. I personally like the ease of QR-enabled devices like the Passport and Keystone Pro. Don’t let dad forget to back up his private keys in steel. I prefer Black Seed Ink. Just make sure he remembers where he accidentally loses them on the next boating excursion.
Another cool idea would be to get your dad his own Bitcoin full node to verify his own transactions and enforce the blockchain rules. There are out of the box solutions like The Sovereign Machine, nodl and the Ronin Dojo. They all have their own benefits and trade-offs, but luckily Bitcoin Magazine has already published a ton of research, so I don’t have to spell it out here. Just know there are also many DIY solutions that cost a lot less.
For The Bitcoin-Skeptical Dad
Socks. They don’t deserve bitcoin.
Just kidding.
If dad is on the more intellectual side, I would recommend a well thought-out and beautifully written book like “Bitcoin Is Venice.” It’s a pretty dense read but incredibly thought-provoking and logical. If he’s on the fence, this may help your dad hop onto the lifeboat.
Another route would be a subscription to the Bitcoin Magazine print edition. Surprisingly, financially literate people largely view bitcoin as a scam or pyramid scheme. The stories in the magazine can help your dad view bitcoin as a fundamentally world-changing technological development. It’s so much more than “price go up” technology. It is fundamental to the preservation of your freedom.
Bitcoin Is The Gift That Keeps On Giving
Bitcoin is a hedge against inflation; it’s a hedge against tyranny. It’s an open and permissionless monetary network, all wrapped into one. As gas and food prices continue to hit all-time highs, it might just be the best time ever to try and get your dad to jump onto the life raft.
The Revolutionization of the Supply Chain Management by Vechain
VeChain (VET) is a project that aims to transform the way consumers and producers do business by making traceability of products, services, and transactions easy, efficient, transparent, and secure, all powered through blockchain technology using smart contracts and digital identity. In addition to its primary objective, VeChain has also been trying to create a more decentralized economy with its DaaS (Decentralized Application Service) platform and other solutions such as its enterprise-oriented IoT products.
The Vechain network was launched in 2015 as a private consortium chain. Afterward, it transited to a public blockchain in 2017, launching its main net in 2018. One of the substantial benefits brought by VeChain is its toolchain.
What is toolchain technology, and why did Vechain implement it?
Vechain's founder Sunny Lu, has been working on developing Vechain-PoA and its related technologies for quite a while. The technology was not very popular in the crypto industry due to its complicated implementation process and high cost of development in the traditional industry compared with other solutions based on blockchain technology such as Ethereum. However, the Vechain team has recently started implementing new technologies such as the VeChainThor and VeChainGO.
Toolchains are an essential part of any blockchain project to build, develop, test, debug, and deploy smart contracts safely, ensuring the validity of each transaction made on its network. Without the need for third-party validation or audits to ensure correctness in transactions and blockchains, making them more transparent and auditable and improving efficiency and security. So you can be sure that this is where VeChain comes into play as the best blockchain technology provider of all time with its unique features in supply chain management, which include:
Security
As they use the latest version of Hyperledger Fabric, this offers an immutable ledger that is distributed to every participant, which means that it is safe from hacking, attacks, and fraudulent activities.
It is based on a tamper-proof public ledger and records each transaction through cryptographic hash values (a chain of blocks). So you can ensure that your data will not get lost if someone tries to hack or manipulate the network.
Tracking
It allows tracking of products from origin to end-user without any intermediary services Smart Contracts. The code on top of the VET blockchain can automatically execute smart contracts, allowing you to set up agreements between parties.
Scalability
This feature can be used to store a large amount of data and process it in real-time for a faster transaction rate with smart contracts.
Reliability
IBM has tested them to ensure that everything works perfectly without any glitches or errors that may occur.
The Vechain technology is transparent and offers a traceable supply chain management system that allows every single detail of a product's movement to be tracked, recorded, and verified in real-time on a distributed ledger. It allows users to scan QR codes attached to products or use NFC (Near Field Communication) enabled devices to get instant access to product details, ingredients, expiry dates, certifications, and other data about the item. Enabling manufacturers to track their products from the production stage to retail allows consumers to see exactly where the product they bought came from and what it was made of.
Accessible Supply Chain Management Solutions
The VeChain toolchain is a network that allows the blockchain to get information from IoT devices. It delivers an expansive network with no code or low code blockchain solutions meeting the most demanding industry requirements.
The supply chain management process occasionally requires tools that are frequently assembled and complicated to use. The toolchain brings clarity, comfort, and affordability.
Essentially, the toolchain introduces a pay-as-you-earn pricing model that is quite affordable. The toolchain provides a complete set consisting of;
Vechain has become a significant player in anti-counterfeiting products by combining an innovative blockchain with modern technology to protect intellectual property rights and offer secure identification solutions to consumers worldwide for consumer goods, healthcare, financial services, Etc.
Today's counterfeits are getting increasingly sophisticated, making it harder and harder for brand owners to trace their origins back to the original manufacturer and source of their product. As a result, brand owners have been forced to take more drastic steps to combat this problem.
In 2017 alone, brand owners saw sales decline by $25 billion due to counterfeit goods being sold on websites such as Amazon and eBay, while others claim that there has been a "$200 billion a year loss of revenue to illegal manufacturers around the world" (Wakefield & Lacy, 2015). According to the World Intellectual Property Organization (WIPO), counterfeit products account for an estimated $1 trillion per year worldwide (WIPO, 2019) – which is not only bad news for businesses but also has a direct impact on consumers.
VeChain delivers a fence against the risk of counterfeiting. Because of the linking with IoT devices allows both parties to a trade, i.e., supplier and buyer, to recognize the products and location in real-time. If the delivery vehicles stop, the IoT devices will transmit the information through the toolchain to the DLT.
The constant tracking of products' data in the supply process guarantees that the persons delivering the products cannot provide counterfeited products.
Highly Convenient
The problem of supply chain management begins from the roots, which happens to be software support. Vechain toolchain makes it very easy for any project, individual, or company to create a blockchain with little to zero coding knowledge. Therefore, businesses can create apps that use the toolchain to offer their supply chain solutions.
Final Word
This article has explored how the Vechain toolchains revolutionize supply chain management, offering privileges to participants. As mentioned, the toolchain touches on different aspects of the supply chain, including security, tracking, and reliability, all while offering convenience.
By touching on various aspects of the supply chain, the toolchain guarantees that the quality and health of products in supply are protected at high standards. Top networks have already been linking with the toolchain to enjoy its benefits. They include DNV, BitOcean, National Research Consulting Center, and Groupe Renault.
Gold is doing 'spectacular job' but price drop to $1,800 not ruled out, here's why
Gold surprised this week with its resilience and steadiness after an oversized 75-basis-point hike from the Federal Reserve and massive volatility across many markets. But analysts don't see a major rally developing in gold in the short-term, and they are not even ruling out a move back to $1,800.
The precious metal's reaction to the Fed's decision to raise rates by 75 basis points — the biggest increase since 1994 — has been very encouraging. Fed Chair Jerome Powell also signaled that another 75bps is possible in July, adding that the so-called 'softish landing' will now depend more o external factors like commodity prices.
After digesting the information, the stock market saw a sharp drop, while gold rallied around $40 on Thursday. However, the rally was short-lived as August Comex gold futures retreated to 1,841.70 an ounce Friday, down 0.44% on the day.
"Gold's current relative stellar performance is surprising, as it usually tracks the Fed's policy rates and real interest rates intently," TD Securities global head of commodity strategy Bart Melek. "And, the market hiked its year-end Fed Funds expectation from 2.7% in mid-May to 3.6% now. At the same time, the 10-year real rate, which is the usual driver, jumped well over 50bps from a month earlier to 0.69% and some 180 bps higher from the start of the year."
The performance of gold versus that of other markets stands out, said Gainesville Coins precious metals expert Everett Millman. "Other markets you look at, even some safe havens like the U.S. dollar, have been remarkably volatile. Gold has had relatively low volatility. It is a sign of strength and gold doing its job — holding steady even amid turmoil across other assets," Millman told Kitco News.
Year-to-date, gold is largely flat, up 0.5%. Yet, Millman pointed out that this resilience does not mean a rally is just around the corner.
"We've seen gold rally nice and then pull back. I expect that to continue up until the next Fed meeting in July. Gold will be range-bound and stuck trading sideways until we find out whether the Fed will go through with another large rate hike," Millman said. "Rate hikes are supposed to be bad for gold. But when inflation is this high, it will take many rate hikes for the Fed to get to where the real rate of interest rate is neutral. And that is what gold cares about. Maybe next year, they will get there."
What's next for crypto after 'perfect storm' crashes prices? Ethereum's market cap is 'orders of magnitude higher' than Bitcoin — Messari
Throughout the summer, Millman sees gold between $1,800 and $1,900, with $1,840 flipping from support to resistance and vice versa.
He added that even though inflation remains one of the primary drivers for gold, growing recession risk could encourage some additional gold-buying if investors continue to fear losses in other assets.
Gold has been doing "a spectacular job," described Melek. But that doesn't mean the precious metal doesn't correct here and returns back towards $1,800. "It won't be a rout but a modest correction," he said.
The thinking behind Melek's projection is a persistent Fed, which won't give up aggressive rate hikes at the first sign of economic trouble. "My suspicion is that the Fed won't change its mind any time soon," he said. "It is very likely there will be many more aggressive hikes in the face of strong inflationary forces, which will likely send gold back to the May lows."
And that means a return to the $1,824-$1,808 range in the near term. "Still think we can go below $1,800 by the end of the year. It is too early to say that the Fed will flake at the first sign of trouble. Could be in a situation where growth starts to slow, but we won't see a significant move in inflation until September or October."
Data to watch next week
Out of all the macro data on the docket for next week, housing will be a vital element to keep a close eye on. The key thing to watch is the impact of the Fed's higher rates on the economy, including the housing market, said ING chief international economist James Knightley.
"With the Federal Reserve signaling it has a strong stomach for the fight against inflation, we have to expect further significant interest rate hikes in coming months. But by going harder and faster into restrictive territory, there is a greater risk of a hard landing and a potential recession," Knightley said in a note Friday. "The housing market is particularly vulnerable given prices are up nearly 40% nationally since the start of the pandemic due to stimulus-fuelled demand vastly outstripping the limited supply of properties for sale."
Another event to monitor will be Powell's testimony before the Senate Banking, Housing, and Urban Affairs Committee on Wednesday and the House Financial Services Committee on Thursday.
Tuesday: U.S. existing home sales (May)
Wednesday: Fed Chair Powell testifies
Thursday: Fed Chair Powell testifies, U.S. jobless claims, U.S. manufacturing PMI
BlackRock – Shadow Government?
Is It Too Big To Fail? Or Has It Now Got Too Big To Control?
There is a company out there that has more funds running through its systems than the entire GDP of the USA. A company that can and has used its clout to effect “societal change” whether we like it or not. A company with a direct connection with powerful politicians in the world has recently come front and center as it has started exploring investments in the crypto space and venturing into governance territory that will impact worldwide.
The BlackRock Behemoth
BlackRock is the world’s largest asset manager, and while many may have heard of it, you may be surprised just how much control it has over the financial markets. A control is afforded to it through leveraging our money, so there’s a strong chance that you and your money are connected with it somehow. It is a company that has its fingers in many pies, with over $10 trillion in assets under management.
They are also one of the most secretive companies in the world of finance. Trading and commodities are two areas of BlackRock’s business that have come under scrutiny from government regulators in recent years.
The Commodity Futures Trading Commission (CFTC) has claimed that the process of trading commodities futures is not transparent and is likely being abused by large investment firms like BlackRock. One of the most controversial aspects of BlackRock’s business is the way they have been operating their so-called dark pools.
Blackrock’s political connections are extensive. Over the past couple of years, there has been growing concern about how much control large corporations like Blackrock exert over American politics and economic policymaking.
Although they claim to be a non-political organization whose only interest is maximizing shareholder value, it is clear that many large corporations like Blackrock do wield significant influence over how our government works and what kinds of policies it enacts into law.
BlackRock is a New York City-based company founded in 1988 by Laurence [Larry] Fink and Ralph Schlosstein. Starting as a Bond Asset manager, it quickly grew into a financial services company that provides investment management, risk management, and fiduciary financial services to a wide variety of clients ranging from Central Banks to pension funds and individual investors.
In 1999, BlackRock became a publicly-traded company and continued its rapid expansion in the asset management sector. In 2006, the firm acquired Merrill Lynch's Asset Management business, which rapidly expanded its offerings in the equities sector. This was further compounded by the purchase of Barclay’s iShares in 2009. At $13.5 billion, this was one of the biggest deals in Asset Management history.
As a result, BlackRock quickly morphed from being a bond asset management company to an Index Fund provider. Index Funds, sometimes called Exchange Traded Funds, are collective investment vehicles that track the performance of a particular index or basket of Securities. They're hugely popular, not only because they're easy to invest in but also because they incur lower fees than more active investment management firms.
These benefits have also made index funds extremely attractive for more passive institutional investors, the most common being pension funds. Trillions of dollars are invested on our behalf and find their way into index funds of some sort. So there’s a strong possibility our money has been invested through BlackRock somehow. Either that or it's being invested by another index provider thanks to BlackRock’s technology.
The point is that BlackRock is a behemoth that invests on behalf of hundreds of millions of people, and what that means is it has an interest in nearly every company you can think of. Since BlackRock must invest funds to track indexes or other investing themes, it must invest in the underlying assets. If these funds track an equity index, BlackRock must take a stake in the underlying company, so BlackRock is often one of the largest shareholders of a company's outstanding shares.
These companies include some of the biggest Wall Street banks, like Goldman Sachs, JP Morgan, Bank of America, and Citibank. Essentially, BlackRock is one of the top three shareholders in the banks that keep the financial markets running.
BlackRock is also vested in the media with Comcast, Viacom, et al. Also, social media and tech companies with large stakes in Google, Apple, and Twitter. They even have stakes in the food industry with Mcdonald's, Chipotle, et al. Along with State Street and Vanguard, BlackRock forms a trio of the largest shareholders in the vast majority of publicly-traded companies in America.
For example, according to a recently published paper by Corpnet, these prominent three asset managers are the largest shareholders for over 90% of all companies in the S&P 500. In fact, in the broader collection of all outstanding publicly traded companies, 40% of them have these three as their most significant shareholders. And it’s not just America; it holds considerable positions in companies in Europe as well.
A Slice Of The Real Estate Pie And Now Crypto
BlackRock has its eyes on cryptocurrency with BlackRock CEO, Larry Fink saying the firm is studying the crypto sector broadly, including assets, stablecoins, permissioned blockchains, and “tokenization,” where it perceives a benefit to its customers. We are increasingly seeing interest from our clients, he said.
BlackRock is an investor in a $400 million fundraising round for Circle Internet Financial, the crypto-focused company that manages the stablecoin USD Coin. During a conference call in April 2022, Larry Fink said BlackRock has been working with Circle over the past year as a manager of some of Circle’s cash reserves. He said he expects BlackRock eventually to be the primary manager of those reserves. We look forward to expanding our relationship, he said.
You might also be surprised to learn that asset managers like BlackRock have been competing with you regarding residential real estate. Last year, large institutional investors bought up entire property units to diversify their holdings. Just imagine, large asset managers could potentially be using your pension money to outbid you on a home. Despite how crazy all this sounds, it’s just the tip of the iceberg.
ALADDIN – BlackRock’s Genie Of Growth And Control
BlackRock has not only made a name for itself through its index funds, but it's also developed an institutional investing platform that is the backbone of the asset management system. The “central nervous system” is relied upon by nearly every billion-dollar capital allocator. It’s called Aladdin, an acronym for Asset, Liability, And Debt, Derivative Investment Network.
Since Aladdin’s humble beginnings as a time-saving system that BlackRock could use to report on bond positions automatically, it has grown over the years to become the operating system for the company that inhabits multiple data centers and is maintained by a group of between 1,500 and 2,000 people.
Aladdin is so integral to BlackRock’s internal risk management systems that around 13,000 BlackRock employees use it worldwide. Aladdin also became so sophisticated that BlackRock saw an opportunity to start making money from competing asset managers, institutional investors, and corporates by making the platform available to them. It would also allow these investors to manage their portfolios and model the inherent risk.
The list of companies that use Aladdin is vast, with over 240 external clients currently relying on the platform. Companies like Google, Apple, and Microsoft use it for their corporate treasury management. The $1.5 trillion Japanese government pension fund is also a client, as well as State Street and Vanguard.
So, in reality, BlackRock’s biggest competitors are effectively paying to use BlackRock's systems and, in the process, giving BlackRock access to reams of data about their portfolios. This data further helps BlackRock refine Aladdin and better model risk. Needless to say, because all these portfolios are linked, it certainly gives BlackRock the edge with Aladdin as a critical component in the global management of assets.
In 2020, an estimated $21.6 trillion sat on the platform, which is higher than the entire GDP of the United States at that time. Another comparison is if you were to empty the bank account of every one of the 7.6 billion people in the world, every single bill and coin, and place them all in a pile, it would be worth around $5 trillion.
So, this means that Aladdin has grown into a system that is responsible, directly or indirectly, for over four times the value of all the money in the world. Aladdin doesn’t make investment decisions, but its risk models inform the investment decisions of all who use it.
There have been many who have questioned whether this system poses a systemic risk to the market. For example, given how many managers rely on its analytics and modeling, does this create complacency and reliance that could give a false sense of security? What happens if there are inaccurate or erroneous readings? It's only a computer model, after all.
A UK regulator, the Financial Conduct Authority, reported that the failure of an extensive portfolio and risk system like Aladdin could cause serious consumer harm or even damage market integrity.
Jon Little, former head of BNY Mellon's international asset management business, told the Financial Times,
“The industry is becoming reliant on a small number of players such as Aladdin, yet regulators seem to be reluctant to regulate or intervene to supervise these key service providers directly.”
This video sums up the level of involvement BlackRock has with their technology, Aladdin has and looks somewhat like a terrifying science-fiction scenario, but it is happening today.
BlackRock’s Helping Hand
Did you know that BlackRock was instrumental in the bailouts and deals in 2008’s GFC? It was a key adviser to other big banks and the government itself. So BlackRock is not only a massive asset manager that controls one of the world’s most powerful computers, but it also offers advisory services.
It’s called the Financial Markets Advisory or FMA. It was born from the financial crisis as these big banks, along with the US Treasury and Federal Reserve Bank of New York, turned to Larry Fink of BlackRock for help and counsel on their predicament.
Through an array of government contracts, BlackRock effectively became the leading manager of Washington’s bailout of Wall Street. The firm oversaw the $130 billion of toxic assets that the U.S. government took on as part of the Bear Stearns sale and the rescue of A.I.G.
It also monitored Fannie Mae's and Freddie Mac's balance sheets, which amount to some $5 trillion. It provided daily risk evaluations to the New York Fed on the $1.2 trillion worth of mortgage-backed securities it had purchased to jump-start the country’s housing market.
Eleven years after the financial crisis, we had another emergency, the pandemic, which brought on a level of spending that was many multiples larger. The FED embarked on an unprecedented bond-buying program and monetary stimulus. These were trillions upon trillions of dollars that are used to buy back not only treasury securities but, more risky, corporate bonds and mortgage-backed securities.
And, of course, they needed the advice of someone who knew about these types of securities. Thankfully, they had the industry experts such as Larry Fink on speed dial. It was later disclosed that BlackRock was central to the pandemic response. According to this New York Times article, Larry Fink was in constant contact with Jerome Powell and Stephen Minuchin in the days before and after the FED's stimulus program announcement.
According to a contract posted in March 2020, the FED hired BlackRock to help with the corporate bond purchase program. Although there was much more transparency about the terms of the deal compared to its work back in 2008, it meant that BlackRock was instrumental in that bond-buying program.
It again shows how reliant these officials have become on this behemoth of Wall Street. So it's clear that BlackRock has political influence or, at the very least, is aligned with some really powerful people. But perhaps more concerning about the firm is its power and intention to exert over corporate board rooms.
BlackRock’s Role And Goal Posts Have Shifted
As mentioned above, BlackRock and the top three asset managers generally are the largest shareholders in hundreds of Fortune 500 companies. What this means is that not only do they own the shares, but they also get board representation. These corporate boards are designed to help advise on company strategies, and board members can have much more say in a company’s strategic objectives.
Given that BlackRock invests on behalf of clients, it is considered a passive investor, meaning it's merely tasked with allocating capital and voting in the best interest of shareholders. Up until a few years ago, that's precisely what it did. However, in 2018, it all changed because, at this time, Larry Fink wrote a letter to the CEOs of some of America's largest public companies. This was the first salute in his pitch to better contribute to society,
“Society is demanding the companies, both public and private serve a social purpose. To prosper over time, every company must not only deliver financial performance but also show how it makes a positive contribution to society.”
This was a novel idea at the time but has since shaped the mood around investing based on ESG or Environmental Social and Governance principles. The primary modus operandi behind this investing methodology is that companies should not only be graded on their bottom line but also on how they impact society.
This letter was a big deal. You had one of the most powerful investors on Wall Street saying that it would be using ESG criteria to grade companies, everything from their climate change records to diversity on their boards. Some wondered whether BlackRock really would carry out these plans for a more activist role; any doubts on the matter were laid to rest with some controversial shareholder votes.
For example, last year, BlackRock disclosed that as Exxon Mobil's second-largest shareholder, it was backing board changes proposed by an activist hedge fund. The fund in question was Engine No 1, and it's been trying to get Exxon Mobil to move faster in reducing its carbon footprint. The activist investor only held about $50 million in stock but had proposed some board members who Exxon claimed didn't possess the requisite skills to serve on the board.
As mentioned in this WSJ report, BlackRock also backed similar initiatives by voting against a board director of an Australian oil and natural gas producer called Woodside Petroleum. The reason for the vote was that the company was not outlining targets for emission reductions to its customers. So the world’s largest asset manager is showing it is more willing to use its heft to influence the policies of the companies it invests in.
Rich Field, a partner at the law firm King & Spalding, who focuses on corporate governance issues, said,
“BlackRock has strongly signaled that quiet diplomacy is not the only tool in its toolbox. We expect more votes for shareholder proposals and against directors in this and future years.”
Since 2020, BlackRock has stepped up pressure on more companies by publishing criticism with online bulletins about key votes. Some executives worry they could face lawsuits for publicizing details on labor or climate plans in areas where global disclosure standards don’t yet exist.
There are so many boards that BlackRock sits on that it could be hard to apply proper due diligence to these ESG votes. Some have complained BlackRock’s recent votes have come without warning or an adequate rationale. Ali Saribas, a partner at shareholder advisory firm SquareWell Partners, said,
“BlackRock’s approach will fuel a rising frustration among companies that believe BlackRock’s stewardship team will most likely apply a tick-the-box approach given the sheer volume of companies they passively own.”
Jessica Strine, CEO at advisory firm Sustainable Governance Partners, says,
“It would be very hard for a passive fund manager to support a shareholder proposal that addresses systemic risks but wades too far into dictating strategy.”
Investors propelled ESG funds to new heights in 2020, and federal agencies are watching. WSJ explains why regulators have ethical and sustainable investment funds under review. Photo Illustration: Alex Kuzoian
Has BlackRock Gone Too Far?
Some may think this is good news for a better future. Still, one of the biggest problems with this approach is that it assumes that meeting these ESG criteria could be complementary to the shareholder returns objectives.
However, this is often not the case because meeting these criteria may come at the expense of potential company performance and long-term shareholder returns. For example, in the case of the Exxon proposal, unless these standards are applied to all competing companies in the field, you are hampering some to the advantage of others.
Many oil and gas companies are private or listed elsewhere, companies that don't have BlackRock as a shareholder and hence don't have to worry about meeting the same standards. They can compete as much as the law allows them to, and sometimes to the detriment of Exxon. This could lead to a fall in the value of Exxon shares and the company as a whole.
Now the same principles can, of course, be applied to the S and G angles of the ESG strategy too. Then, of course, you have the administrative burden and the unpredictable way this ESG mandate is managed.
The approach that BlackRock wants to take could hamper the efficient performance of a company's board and corporate strategy, which is unsuitable for that long-term shareholder value. Beyond the additional burdens that this could place on companies, you have the question of whether a company like BlackRock should have such a significant say in how society is shaped.
The Silenced Majority
Have all the stakeholders, the millions of us who have pension funds and invest in ETFs, been asked how we feel about these proposals? Are stakeholders polled on each one of these proposals? And how do we know there's no broader political agenda that could seep in should the winds of public opinion shift. Does this create a precedent for other large companies to follow suit? These are all relevant questions that need to be answered. It is, after all, good governance.
Many of us know BlackRock is a powerful company but to realize how far that power extends is an eye-opener, to say the least. As the world's largest asset manager, it manages an ocean of capital that gives it immense control over the financial system.
Given that it's the owner and operator of one of the largest and most crucial asset management platforms, many would argue that it's too big to fail, but more to the point, it's now too big to control. That's because BlackRock seems to be taking on a new mission beyond mere capital allocation.
The firm is looking to use its ESG mandate to shape the way that corporate America is run. It's also not as if politicians can really do much about it. Given BlackRock's connections with all of these higher-ups, it is more likely to call the shots than the other way around.
Of course, the mandate and goals of BlackRock may be benevolent and sincere, but you have to question how this power could be used in the future should it fall into the hands of someone who would use it for more than just ESG benchmarks? Money is power, after all, and given that BlackRock controls so much money, it has absolute power. And as the saying goes, absolute power corrupts, absolutely.
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What's next for crypto after 'perfect storm' crashes prices? Ethereum's market cap is 'orders of magnitude higher' than Bitcoin — Messari
