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Currency Trading Is Both Boon and Bane for Wall Street

Posted on 16 October 2014 by VRS  |  Email |Print

Foreign-exchange trading is once again fueling revenue at Wall Street banks. It also remains one of their biggest headaches. Currencies bolstered third-quarter results of bond-trading desks at the three biggest U.S. banks, an unexpected boon as prosecutors weigh charges over allegations that traders rigged foreign-exchange rates.
Fixed-income revenue at Bank of America Corp. surged 11 percent from a year earlier, “driven by strong results” in currencies, the Charlotte, North Carolina-based firm said yesterday. Citigroup Inc., the world’s largest foreign-exchange trader, reported a 5 percent increase, citing improvement in rates and currencies. The gain was 2 percent for JPMorgan Chase & Co., the biggest U.S. bank by assets………………………………………..Full Article: Source

Currency Comeback Seen in Record $5.9 Trillion a Day at CLS

Posted on 15 October 2014 by VRS  |  Email |Print

CLS Group Holdings AG, operator of the world’s largest currency-trading settlement system, handled a record $5.94 trillion a day in September as volumes recovered from a slump in price swings that crimped activity.
The average value of transactions settled by CLS each day rose 21 percent from August, it said in a statement. The New York-based company settled more than 2 million payments on Sept. 17, the most since its creation 12 years ago………………………………………..Full Article: Source

Alleged mastermind of global online currency scheme held without bail after Manhattan hearing

Posted on 15 October 2014 by VRS  |  Email |Print

The accused mastermind of a $6 billion digital currency system allegedly used as an underworld bank for hackers, identity thieves and drug dealers was held without bail Tuesday in federal court in Manhattan following his weekend extradition from Spain.
Arthur Budovsky, 40, the founder of Liberty Reserve, had been awaiting extradition since prosecutors charged in May 2013 that the company’s virtual currency helped cyber criminals, child pornographers and fraudsters anonymously launder their proceeds. Budovsky, who renounced his U.S. citizenship and operated out of Costa Rica in an attempt to avoid U.S. money laundering laws, pleaded not guilty in a brief hearing before U.S. District Judge Denise Cote. He faces up to 30 years in prison………………………………………..Full Article: Source

Russia and China Open Currency-Swap Line

Posted on 14 October 2014 by VRS  |  Email |Print

Russia and China have opened a currency-swap line, paving the way for further trade and investment between the neighboring countries, Russia’s central bank said on Monday. Russia has stepped up efforts in recent months to develop closer ties with China after relations with the West deteriorated over the situation in Ukraine.
Western sanctions, aimed at punishing Russia for the annexation of Crimea and its support of anti-Kiev rebels in eastern Ukraine, have effectively removed it from the global borrowing markets. The new foreign-exchange swap facility is designed to improve liquidity in Russia’s financial sector and beef up stability………………………………………..Full Article: Source

A Strong Dollar = Weak Commodities

Posted on 13 October 2014 by VRS  |  Email |Print

The data and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any futures contracts. Although all information and opinions are believed to be reliable, we cannot guarantee its accuracy or completeness. The open trade and previous recommendations were suggested, but that does not necessarily mean any individual followed the trades exactly as recommended.
This newsletter has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Past performance is not necessarily indicative of future results. There is a significant risk of loss associated with trading futures and options. “It should be noted that the impact on market prices due to seasonal or market cycles and current news events may be reflected in current prices.”……………………………………….Full Article: Source

Virtual currency still risky for some

Posted on 13 October 2014 by VRS  |  Email |Print

Surging interest in Bitcoin is not translating into commensurate investment, as most potential investors are bogged down with apprehensions over virtual currencies, owing to the lack of regulation. The Reserve Bank of India (RBI) last cautioned investors about the risks involved when dealing with virtual currencies. It said the value of such currencies seems speculative as they are not backed by assets. Their location of storage, called e-wallets, can be hacked and access to the wallets can be lost or stolen.
The legal status of use of bitcoins as currencies and for trading is unclear, RBI had warned. The Central bank, however, stopped short of regulating it or banning it. Potential investors say they would be comfortable investing in Bitcoin if RBI issued guidelines………………………………………..Full Article: Source

Expect more currency-war rhetoric ahead

Posted on 13 October 2014 by VRS  |  Email |Print

Competitive devaluations are back in fashion – expect more currency-war rhetoric in the months ahead. The implications for investors will be profound as more countries engage in a 1930s-style zero-sum game to win a bigger share of anaemic global growth.
This bout of devaluations began with Japan in 2012, when the yen depreciated by around a fifth in a matter of months. Interestingly, the impact on Japanese export volumes has scarcely been perceptible, reflecting a loss of the will to compete in Japanese business – witness the decimation of the Japanese electronics industry at the hands of Korean and other competition………………………………………..Full Article: Source

World is in currency war between US, China, Russia, Japan: Economist

Posted on 10 October 2014 by VRS  |  Email |Print

An American economist has said that the world is in a currency war between the United States, China, Russia, and Japan, questioning the countries’ economic growth. “The world is unfortunately in a currency war between the US, Japan, China, and Russia, keeping the interest rates very low and increasing the supplies of money and credit beyond normal, sustainable limits,” said Mark Thornton, senior fellow with the Ludwig von Mises Institute in Alabama and a research fellow with the Independent Institute in California.
Thornton made the comments following a report by the International Monetary Fund that China has overtaken the US as the world’s largest economy. The IMF estimates that the size of the US economy is $17.4 trillion, while the Chinese economy comes in at $17.6 trillion, Business Insider reports………………………………………..Full Article: Source

Currencies: Buck to the future

Posted on 10 October 2014 by VRS  |  Email |Print

Suddenly the dollar is the currency of the moment. The greenback has risen 6.3% on a trade-weighted basis over the past three months. It recently hit a six-year high against the yen and a two-year high against the euro. The trend reflects confidence in the prospects for the American economy, combined with worries about the health of the rest of the world. On October 7th the IMF lowered its forecast for global growth in 2014 to 3.3% from the 3.7% it foresaw in April.
Some of the biggest reductions were in Europe: it now expects France to grow just 0.4% this year, half a percentage point less than in July. To confirm the fund’s pessimism, German industrial production fell 4% in August while factory orders dropped by almost 6%; both were the biggest declines in more than five years. In contrast, the latest American data showed a 248,000 jump in jobs in September and a fall in the unemployment rate to 5.9%………………………………………..Full Article: Source

China’s currency dream gets U.K. lift

Posted on 10 October 2014 by VRS  |  Email |Print

China’s bid to turn its currency into a global heavyweight got a boost Thursday with news that Britain will become the first Western nation to borrow money in yuan. The U.K. government has appointed three banks — Bank of China (BACHF), HSBC (HSBC) and Standard Chartered (SCBFF) — to sell the first non-Chinese sovereign bond in the currency.
Proceeds from the sale will be added to the U.K.’s official foreign currency reserves, worth just over $100 billion. Borrowing to finance government spending is carried out exclusively in British pounds………………………………………..Full Article: Source

Bitcoin speculators being crushed will they now move into silver?

Posted on 09 October 2014 by VRS  |  Email |Print

Every market has its favorite speculative asset and for the past few years the electronic funny money Bitcoin has ruled this roost. Yesterday Bitcoin rebounded from a 20 per cent sell-off over the weekend. But year-to-date speculators in this novel specie have lost 40 per cent of their money in dollar terms.
These are the same mad speculators who drove the silver price up to nearly $50 three years ago. Since then the shiniest of metals has crashed back to earth and now stands at an alluring $17 an ounce, precisely the point at which it previously began its almost 300 per cent price surge………………………………………..Full Article: Source

Dollar Weakens After Fed Expresses Currency Concern

Posted on 09 October 2014 by VRS  |  Email |Print

The dollar fell versus the euro and pared its gains against the yen Wednesday after minutes from the most recent Federal Open Market Committee meeting showed the central bank was concerned that a strong currency could hurt U.S. growth.
The euro rose against the dollar to $1.2741, from $1.2657 before the minutes were released, and was up 0.6% in late trade. The greenback fell to 108.11 yen from ¥108.72 ahead of the minutes, trimming earlier gains but still leaving the buck up 0.1% on the day………………………………………..Full Article: Source

Will China Spark a Currency War?

Posted on 09 October 2014 by VRS  |  Email |Print

Is China about to devalue? The question seems to pop up everywhere I go — most recently in Frankfurt, Sydney and New York. Economists here in Tokyo, too, are buzzing about the chances of a big decline in the yuan in the next few months.
A new report from Lombard Street Research explains why all these folks may have reason for concern. According to London-based Charles Dumas, China’s slowdown will soon drag down gross domestic product growth below 5 percent (whether Beijing admits it or not). Dumas joins long-time Asia investor Marc Faber in thinking China will find itself in the 4 percent range by year end………………………………………..Full Article: Source

China currency push takes aim at dollar

Posted on 08 October 2014 by VRS  |  Email |Print

Protests over democracy in Hong Kong may be preoccupying the Chinese leadership, but a subject of still greater international importance is being played out this week behind closed doors in Washington. China is bidding to enter the heart of global finance by establishing its currency, the renminbi, as part of an ubiquitous monetary unit used in official transactions around the world.
The issue of whether the Chinese should be part of the International Monetary Fund’s Special Drawing Right, the composite reserve currency used in official financing, is highly technocratic, but the political questions at stake go to the core of world money and power – and will be discussed, in the background, at the annual meetings of the IMF and World Bank in Washington this week………………………………………..Full Article: Source

Rouble suffers further falls as oil price slips again

Posted on 08 October 2014 by VRS  |  Email |Print

The Russian rouble has dropped below 40 to the dollar for first time as the currency comes under renewed pressure and is likely to test further record floors as the week progresses. Sanctions, global market shifts, a fall in demand for commodities and a weak oil price can all partially explain Russia’s current economic weakness. There are few signs this will change any time soon.
“All this quite significant rouble weakening was mostly related to the sanctions story, to concerns about the negative effects for the Russian economy and for corporates’ ability again to pay their external debt. But at the same time now the sanctions issue has somewhat stabilised, and therefore the next factor the market is looking at is the falling oil prices,” said Dmitry Polevoy, chief economist at ING Russia………………………………………..Full Article: Source

Roublecoaster continues for Russian currency

Posted on 07 October 2014 by VRS  |  Email |Print

The Russian rouble hit a new all-time low against the dollar on Monday morning as traders dumped the currency. It has been under heavy selling pressure for months through sanctions, the crisis in Ukraine. and weak prices for its two main exports, commodities and oil.
Despite this Moscow moved on Monday to close down its network of stand-alone money exchanges or force them to join a bank. The exchanges have been around since the fall of Communism, and their removal say analysts points to the increasing maturity and normalisation of the Russian banking market………………………………………..Full Article: Source

The myth about currency

Posted on 07 October 2014 by VRS  |  Email |Print

Recently the US dollar has surged. Its gain versus a basket of major currencies since the beginning of July as measured by the US Dollar Index ‘DXY’ is almost nine per cent as of this writing. Most of this appreciation has come at the expense of the New Zealand Kiwi, the Australian dollar and the euro.
Many people like to point out that the recent weakness in the euro should be a boon to European exporters and large dominant European companies. This may explain some shorter-term fluctuation in profits but empirically it is not a major long-term driver. One has to remember that companies that dominate the European stock markets tend to have business units in several major currency blocs, and in many cases, the companies are actually hedged against large currency swings………………………………………..Full Article: Source

Precious metals lacklustre on stronger dollar, weak physical demand

Posted on 06 October 2014 by VRS  |  Email |Print

Precious metals weakened on strength in US dollar and weak phyical demand. Barclays noted in a weekly report that platinum prices fell towards $1200/Oz to levels last tested in August 2009, making it the laggard of the complex. Silver has also failed to find fundamental support and has tested levels below $17/oz for the first time in 4½ years.
Palladium and gold have fared better,with gold having only surrendered its gains for the year, tumbling below $1200/oz after the strong nonfarm payrolls report, while palladium has fallen to six-month lows as the dollar has strengthened and equity markets have weakened. In our view, palladium’s fundamentals have limited the metal’s downside to some extent but the recent price weakness raises the question: where is the price floor for the precious metals?……………………………………….Full Article: Source

The euro is a broken currency and possibly beyond repair

Posted on 06 October 2014 by VRS  |  Email |Print

Weakening of euro against the US dollar is a symptom of fiscal and monetary failures, with much of the blame lying at the door of the ECB. The euro’s survival hangs in the balance as worries about weakening fundamentals that have dogged private sector investors since the onset of the global financial crisis spread to reserve managers at official sovereign institutions.
The European Central Bank is hardly helping matters. Repeated policy failure has seen the bets stack up that the euro will fall to re-test parity with the US dollar in the near future. The risk is that the combination of weak euro fundamentals and the US dollar’s correction from its massively oversold position could take the rate a lot lower………………………………………..Full Article: Source

China’s Golden Plans For A New Reserve Currency

Posted on 06 October 2014 by VRS  |  Email |Print

In a recent interview, Stephen Leeb, founder of the Leeb Group, discussed what he believes are China’s plans to buy more gold and make the yuan the world’s reserve currency. Leeb said that although gold is declining, “People that see what’s happening in the world, especially the Chinese, are getting a lot more serious about” gold. They are, he said, “Determined to get gold, [and are] in a hurry to get gold.”
Xi Jinping, the General Secretary of the Central Committee, and Premier Li Kequiang, Leeb said, “Have done a remarkable job.” Although they have only been in power less than two years, they have “really addressed [corruption] and attacked it.” They “have really made China a much better place to do business….You don’t have to worry about someone coming along with a bigger bribe” anymore………………………………………..Full Article: Source

Lira leads the way in emerging-currency devaluation

Posted on 06 October 2014 by VRS  |  Email |Print

The beleaguered Turkish Lira has become the most fragile currency after the Fed signaled that the lower liquidity environment is coming earlier than expected. The United States’ Federal Reserve (FED) will cut its bond-buying program as part of plans to end a program that served to support its country’s economy since the global crisis and will slowly increase interest rates.
Following this message from the FED, the capital outflow from “emerging countries” has caused significant losses in local currencies in the past 16 months………………………………………..Full Article: Source

Canadian dollar gaining ground as reserve currency, IMF data shows

Posted on 03 October 2014 by VRS  |  Email |Print

The Canadian dollar isn’t looking great compared to its U.S. counterpart of late, but foreign governments are buying up more loonies to keep in their currency reserves — a vote of confidence in the loonie over the long run.
Most countries stockpile reserves of other countries’ currencies in their central banks, both as a way of paying for things denominated in those countries, and as a general stockpile of wealth. As it stands, world governments currently have more than $12 trillion worth of other people’s currencies hoarded, a figure that’s increased by more than $140 billion in recent months as governments pad their rainy day funds………………………………………..Full Article: Source

Dollar Aids World Economy Amid Currency War for Faster Inflation

Posted on 03 October 2014 by VRS  |  Email |Print

It was four years ago last week that Brazilian Finance Minister Guido Mantega declared a “currency war” was underway as the U.S. dollar fell amid easy monetary policy from the Federal Reserve. As the likes of Mantega prepare to jet to Washington next week for the International Monetary Fund’s annual meetings, they will likely be much happier about the dollar’s direction.
That’s because the U.S. currency, as measured by the Bloomberg Dollar Spot Index, has gained almost 7 percent since the start of July and is now around its highest in four years. Behind the rise is the U.S. economy’s outperformance against its peers and bets the Fed will be among the first major central banks to raise interest rates………………………………………..Full Article: Source

Commodities Remain Weak As USD Gets Stronger

Posted on 02 October 2014 by VRS  |  Email |Print

The 3rd quarter of 2014 is over, and some interesting things have happened in the metals sector. The most critical thing has been the remarkable surge of the dollar against other currencies. The US Dollar Index raised over 7% this quarter. This had a depressing effect in the commodities market, and therefore metal prices took a hit.
In the 2nd quarter, we pointed out that some industrial metals (nickel, zinc and aluminum) were showing some strength while others were still lagging (copper, lead and tin). The stimulus measures taken by Beijing were giving some economic momentum in China, helping support industrial metal prices. However, the recent upturn of the dollar changed the picture, making the leading metals to correct while the laggards were pulled to low levels………………………………………..Full Article: Source

Cuba announces details of currency unification

Posted on 02 October 2014 by VRS  |  Email |Print

Cuba’s central bank chief is giving new details about the elimination of a special currency, saying that the shift will require putting more pesos into circulation and issuing higher-denomination bills.
Elimination of the stronger currency is one of the toughest challenges facing Cuba’s struggling socialist economy, forcing officials to eliminate a distorted double set of prices for many goods without spawning inflation………………………………………..Full Article: Source

Pressure on Euro Continues as Recovery in Single Currency Bloc Slows

Posted on 02 October 2014 by VRS  |  Email |Print

The euro remained under pressure and European stocks fell Wednesday amid the latest signs the recovery inside the currency bloc is cooling. The common currency dropped 0.3% against the dollar to $1.2584, close to Tuesday’s two-year low.
The decline came after eurozone manufacturing data disappointed, with the sector barely managing to expand in September. Figures for Germany, the region’s largest economy, showed an unexpected contraction………………………………………..Full Article: Source

G20 calls for reforms of currency benchmarks

Posted on 01 October 2014 by VRS  |  Email |Print

Finance task force says trading window should be made longer as part of efforts to prevent manipulation. The G20’s finance task force has called on currency traders and benchmark operators to tighten up their practices in an effort to prevent the market from being manipulated.
The Financial Stability Board (FSB) said today that the London fix, set at 4pm daily and used in the £3 trillion-a-day foreign exchange market, should have a wider trading window to ensure a broad range of deals is factored into the eventual rate………………………………………..Full Article: Source

Bit by bit, bitcoin is gaining currency

Posted on 01 October 2014 by VRS  |  Email |Print

When you can buy a round of drinks at the local with something that can’t be seen let alone held, you know bitcoin has made it. That, or it’s the world’s most elaborate pyramid scheme.
The Old Fitzroy pub in Woolloomooloo, Sydney and the Grumpy’s Green, coincidentally in Fitzroy, Melbourne, many small businesses and big online retailers from Amazon to Zappos accept bitcoins as payment………………………………………..Full Article: Source

Brazil’s real currency sinks to weakest level since late 2008

Posted on 30 September 2014 by VRS  |  Email |Print

The Brazilian real sank over 2 percent early on Monday to its weakest level in nearly six years as investors grew jittery over growing re-election chances for President Dilma Rousseff, who they blame for driving the economy into a recession.
The real plunged 2.2 percent in early trade to 2.4685 per dollar, its weakest level since late 2008, after the latest Datafolha survey released after markets closed on Friday showed Rousseff gaining on her main opponent, environmentalist Marina Silva………………………………………..Full Article: Source

Venezuela’s Currency Hits New Low

Posted on 30 September 2014 by VRS  |  Email |Print

Venezuela has hit a new, dubious milestone in its slow-motion economic decline: Its largest banknote, the 100-bolívar bill, is worth just one U.S. dollar, at least on the country’s black market.
On Monday, the bolívar held at 100.68 per dollar, unchanged from Friday when it breached the 100 level for the first time, according to DolarToday.com, a significant decline from just 17 per dollar at the start of 2013. DolarToday.com tracks the South American nation’s vibrant currency black market, where many Venezuelans go to get greenbacks and which businesses use as a pricing reference………………………………………..Full Article: Source

China’s renminbi could soon joint select group of currencies

Posted on 30 September 2014 by VRS  |  Email |Print

The stage is set for the Chinese renminbi to develop further as a world currency by entering the special drawing right, the International Monetary Fund’s composite currency unit used in official financial transactions and reserves.
No decision has been made. But measures already taken by the Chinese authorities to internationalize its currency, and a big increase in financial market interest in China, are pointing towards a broadening of the SDR’s composition from January 2016. This is in spite of the renminbi’s formal inconvertibility, reflecting Beijing’s restrictions on capital-account transactions………………………………………..Full Article: Source

Inflows on the rise for US dollar ETF

Posted on 29 September 2014 by VRS  |  Email |Print

A growing number of investors are looking to capitalise on a potential further decline in the Australian dollar with trading data from BetaShares, a leading exchange traded fund (ETF) provider, showing significant inflows into its US Dollar ETF in September.
With the Australian dollar hitting seven month lows against the US dollar, BetaShares has seen approximately $30 million of net inflows into the BetaShares US Dollar ETF (ASX code “USD”) since the start of September. The fund is designed to provide exposure to the performance of the US dollar relative to the Australian dollar, meaning the value of the fund will go up as the US dollar appreciates, and vice versa. The fund now has over $200 million in assets under management………………………………………..Full Article: Source

Venezuela’s Bolívar Currency Hits Record Low on Black Market

Posted on 29 September 2014 by VRS  |  Email |Print

The plummeting Venezuelan currency breached a new, symbolic low of 100 bolívares per dollar on the black market Friday, according to market-tracking websites, in a sign of the worsening greenback shortage faced by President Nicolás Maduro’s government.
Economists say the bolívar is collapsing as Venezuelans clamor for dollars to protect themselves from an inflation rate topping 60%. But the government, which tightly restricts access to dollars, has cut the supply this year, prompting the value of the bolívar to plunge in unofficial street transactions………………………………………..Full Article: Source

Eastern Europe Caught in ECB’s Currency War Crossfire

Posted on 26 September 2014 by VRS  |  Email |Print

The European Central Bank has a weaker euro in its sights, and is finally getting its way. But that could have consequences elsewhere—particularly in Eastern Europe. The euro has now fallen 9% against the dollar since its May peak and is near its lowest in two years. It could well have further to go.
The ECB has chosen to go on the attack in seeking to boost the size of its balance sheet, just as the U.S. Federal Reserve wraps up its bond purchases and begins to confront the need to raise interest rates. The U.S. and eurozone economies are diverging, as are government-bond yields. But the euro is only roughly in the middle of its range in recent years at $1.28. It has previously been far weaker than this………………………………………..Full Article: Source

US Commodities Regulator to Hold Public Bitcoin Hearing

Posted on 26 September 2014 by VRS  |  Email |Print

The US Commodity Futures Trading Commission (CFTC) has announced that it will hold a public meeting to discuss digital currencies on 9th October in Washington, DC. Created in 1975, the US CFTC is an independent federal agency that regulates the country’s futures and options markets. The meeting will be presided by the CFTC’s Global Market Advisory Committee, a group that advises the organisation on issues related to market integrity and competitiveness.
The CFTC indicated that the meeting will consist of two panels, one of which will focus on examining bitcoin and questions surrounding the CFTC’s involvement in the creation of a derivatives market for bitcoin, while the other will center on Non-Deliverable Forwards (NDFs), a form of cash-settled short-term forward contract………………………………………..Full Article: Source

Silver prices hit 4-year low as US dollar soars

Posted on 25 September 2014 by VRS  |  Email |Print

Asian shares slipped on Tuesday as a periodic bout of angst over China combined with the U.S. dollar’s recent meteoric run to pile pressure on silver prices and other commodity prices. Brent oil was near lows last seen in mid-2012, while gold came off a nine-month trough and copper a three-month low on fears a survey out on Tuesday could show stalling factory growth in China.
The HSBC flash reading on manufacturing (PMI) for September is expected to dip to the flat level of 50.0 from August’s microscopically expansionary 50.2, though the market is braced for an even weaker number………………………………………..Full Article: Source

Australian dollar joins commodity club downturn

Posted on 25 September 2014 by VRS  |  Email |Print

Concerns about China and weak commodity prices continued to weigh on the Australian dollar on Wednesday, with the paucity of local market-movers keeping the currency close to recent lows. In late trade, the Aussie was fetching about US88.72¢, compared with highs above US89.20¢ after the local session on Tuesday. The local unit is now around seven-month lows, and is among a group of commodity-linked currencies under particular stress against the US dollar.
New Zealand and Brazil are other commodity exporters whose currencies have succumbed to jitters over slowing China growth. The Kiwi dropped nearly 1 per cent, to a 12-month low of US80.15¢, in late New York trade on Tuesday, before recovering slightly on Wednesday. In late local trade on Wednesday it was fetching US80.81¢………………………………………..Full Article: Source

Your bitcoins weren’t safe–until now

Posted on 25 September 2014 by VRS  |  Email |Print

One of the key drawbacks of Bitcoin is the complexity of security. Throughout its existence, bitcoin has been plagued by insecurity and theft, and there has not been an easily-accessible solution to protect bitcoin investments – until BitStash. Designed to meet the Government’s most stringent standards for data security, BitStash makes owning and spending bitcoin secure and simple for everyone.
Simply plug it in, download the mobile or desktop app, and user’s are guided through a simple setup process. Using entropy generated by atmospheric noise, BitStash generates three tiers of BIP32 crypto currency wallets: a mobile wallet for spending on the go, a device wallet for day-to-day trading or online shopping at home and a cold storage wallet for long-term, off-site secure storage………………………………………..Full Article: Source

Currency-Hedged ETFs Unwisely Underused: Deutsche

Posted on 24 September 2014 by VRS  |  Email |Print

In an increasingly global world, investors want to be able to put their money to work anywhere. However, moves in currency—caused by everything from monetary policy to inflation expectations and balance of trade—pose a real threat to investors’ ultimate returns.
Currency-hedged ETFs a good way to control for this phenomenon, but Deutsche Bank’s Dodd Kittsley and Abby Woodham call these products “underutilized,” even as they argue investors should be more concerned with currency changes, not less, in the current environment………………………………………..Full Article: Source

Kiwi Leads Commodity Currencies Lower on China

Posted on 24 September 2014 by VRS  |  Email |Print

Currencies of commodity-exporting nations including New Zealand and Australia dropped versus the dollar amid concern that growth in China, the world’s second-biggest economy, is slowing. New Zealand’s dollar sank against all of its 31 major peers after a private survey suggested China, the nation’s biggest trade partner, remains stuck in “low gear.”
The Australian dollar and Brazil’s real fell to seven-month lows, while the Bloomberg Dollar Spot Index rose to a four-year high. “If China catches a cold, all these other ancillary economies are also going to catch that cold,” said Dave Floyd, global head of foreign-exchange research in Bend, Oregon, at Aspen Trading Group. “If those concerns exist, it will automatically reflect in the Aussie dollar. The two are very closely tied from a commodity standpoint.”……………………………………….Full Article: Source

5 Reasons Paper Currency Should Be Eliminated

Posted on 24 September 2014 by VRS  |  Email |Print

In 2015, the Apple Watch will likely prompt millions of consumers to stop digging into their pockets for their cell phone and possibly ditch their wallets. Many economists are arguing that governments should consider doing something similar.
The movement for a cashless society has been gaining momentum over the past decade or so, but now it is technologically possible. Still, getting a country of 315 million people to throw away their pennies and dollars and instead embrace digital wallets would require political will and public education on a mass scale. That makes going digital unlikely in the short term in the U.S………………………………………..Full Article: Source

Currencies of Commodity Exporters Drop on China Outlook

Posted on 23 September 2014 by VRS  |  Email |Print

Currencies of commodity-exporting nations dropped as a gauge of raw materials slid to a five-year low on speculation demand will drop after China signaled slower economic growth. The Australian dollar sank to a seven-month low against its U.S. counterpart, dropping against most of its 31 major peers, while South Africa’s rand and Brazil’s real weakened.
The euro pared gains as European Central Bank President Mario Draghi said the region’s recovery is losing momentum. The pound climbed. Federal Reserve Bank of New York President William C. Dudley said a sharply stronger dollar could hamper U.S. central-bank efforts to spur growth………………………………………..Full Article: Source

Bitcoin: Commodity Investment or Currency?

Posted on 23 September 2014 by VRS  |  Email |Print

Bitcoin has had a highly volatile period amidst some difficult events. The Wall Street Journal today weighs the pros and cons of it as an investment or payment system. It is treated as a commodity by the IRS and the same as gold in this category. The past year has brought publicity to Bitcoin due to the Silk Road incident of drug dealing on its website and the anonymous hacking theft that left Mt. Gox, the largest Bitcoin Exchange, in bankruptcy this past February.
Campbell R. Harvey, a professor of finance at Duke University in Durham, N.C., makes an important distinction about bitcoin as an investment or currency. The fall to bankruptcy of Mt. Gox is not the fault of Bitcoin. He states, “Blaming bitcoin for the Mt. Gox bankruptcy is like blaming the U.S. dollar for the downfall of Lehman Brothers.”……………………………………….Full Article: Source

Is It Time to Invest in Bitcoin?

Posted on 22 September 2014 by VRS  |  Email |Print

For some investors—those with stomachs for volatility—it may be time for a closer look at cryptocurrencies. By now, most investors have heard of bitcoin, following its phenomenal growth last year. Bitcoin, an electronic currency made by computers creating series of unique numbers through complex math problems, is sold on unregulated exchanges and accepted by a growing number of individuals and businesses because of the speed and low cost of transactions.
One bitcoin was valued at virtually nothing in the early days and now costs around $437, as of Sept. 18. Other crypto coins tend to have less value, but cryptocurrencies in general are drawing increasing interest as potential investments………………………………………..Full Article: Source

CHF: Still A Sell Vs This Currency - Credit Agricole

Posted on 22 September 2014 by VRS  |  Email |Print

We expect the CHF to remain a sell on rallies, in particular versus commodity currencies such as the CAD. This is due to stable risk sentiment and as there is room for the SNB to turn more dovish in the months to come.
As part of this week’s monetary policy announcement, the central bank downgraded its growth and inflation forecasts and stressed that the risk of deflation increased again. As such it was clearly communicated that all options regarding additional policy measures will be kept open for the time being………………………………………..Full Article: Source

U.K. Currency, Company ETFs Rise As Scotland Polls Near Close

Posted on 19 September 2014 by VRS  |  Email |Print

As noted earlier, Scotland went to the poll today to vote on its independence, a possibility that has been disrupting investment in the region. Although the polls don’t close for another half hour, the market at least has cast a vote, sending ETFs related to the U.K. up. The Guggenheim Currency Shares British Pound Sterling Trust (FXB) ended the day ahead 0.6%.
Plenty of speculation has surrounded the future of the pound should Scotland split from England—some have suggested the Scots adopt Bitcoin as their currency……………………………………..Full Article: Source

Brazil’s Real Falls to Seven-Month Low on Concern Over Fed Rate

Posted on 19 September 2014 by VRS  |  Email |Print

The real fell to a seven-month low a day after the U.S. Federal Reserve supported the dollar by raising its forecast for interest rates as investors awaited the results of a new Brazilian presidential poll.
The currency declined 0.3 percent to 2.3649, the weakest level on a closing basis since Feb. 20. Swap rates, a gauge of expectations for changes in borrowing costs, rose 10 basis points, or 0.10 percentage point, to 11.63 percent on the contract due in January 2016……………………………………..Full Article: Source

Biggest banks to overhaul currency trading

Posted on 18 September 2014 by VRS  |  Email |Print

The world’s biggest banks are overhauling how they trade currencies to regain the trust of customers and pre-empt regulators’ efforts to force changes on an industry tarnished by allegations of manipulation.
Barclays, Deutsche Bank, Goldman Sachs, Royal Bank of Scotland (RBS) and UBS, which together account for 43 percent of foreign exchange trading by banks, are introducing measures to make it harder for dealers to profit from confidential customer information and take advantage of clients in the largely unregulated $5.3 trillion (R58.4 trillion)-a-day currency market, according to people with knowledge of the changes…………………………………….Full Article: Source

How long would Scotland keep sterling?

Posted on 18 September 2014 by VRS  |  Email |Print

I have watched the debate over Scotland’s independence with a certain déjà-vu. In 1995, I along with everyone else in Canada watched nervously as Quebecers voted on whether to separate. Like Scotland’s separatists today, Quebec’s then said they would continue to use the old country’s currency. Jacques Parizeau, the separatist leader, traveled in a bus decorated with the Canadian dollar and insisted that Canadian objections could not stop Quebec from using it.
Yet for a new country to keep another’s currency is, on its face, an odd decision. It robs a country of many tools of autonomous economic policy: monetary policy, of course, but to a great extent fiscal policy as well since monetary policy is no longer available to cushion expansionary or contractionary fiscal shocks. ……………………………………Full Article: Source

Currency Strategy In A World of Risk

Posted on 17 September 2014 by VRS  |  Email |Print

With emerging markets underperforming global markets over the past month, Deutsche Bank offers its thoughts on currencies, with a long position in Brazil’s real and some hope for Latin America. With an eye to global risks, the U.S. dollar strength and the European Central Bank’s quantitative easing, Deutsche writes:
As balance sheet changes of this magnitude tend to underpin persistent realignments across assets, U.S. dollar strength seems likely to weigh further on emerging market foreign exchange, which – in combination with overall reduced local yields – limits the upside for local markets, in our view. ……………………………………..Full Article: Source

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