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Can Reddit’s silver “apes” beat the market?

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Kerry Kraker, 56, has worked in kitchens all his life. Since March he’s spent around $100 a week – half his spare cash – on silver coins. He’s part of a growing social media movement who say they are buying bars and coins for protection from a coming age of inflation.

Thanks to a community of like-minded silver ‘stackers’ gathering on social-media platform Reddit Inc., Seattle-based Kraker says he also feels empowered.

“They are so encouraging and so convinced in the changes they can cause,” Kraker, who lost his home in the financial crisis, told Reuters.

Inspired by Reddit forum WallStreetBets, some of the 122,000-strong community hope to corner the market and bring down what they say is an unjust banking system.

Market professionals say that is unlikely to succeed – there is plenty of silver, and central bankers in the United States and Europe expect inflation to stay in low single-digits.

But bankers aren’t getting through to this group.

“There’s a bit of anger, like ‘fuck the system.’ If there’s a back door to wealth, I might take that door because the front door is closed,” said Kraker. “The bankers and others have basically shut that door for everyone who is not themselves.”

The core of the movement is a Reddit community called Wall Street Silver, formed in January at the time WallStreetBets was marshalling an uprising of ordinary people against the financial elites, through coordinated buying of company shares.

Reuters spoke to more than 20 members, who call themselves “silverbacks” and “apes,” have a home page featuring an image of an army of primates on the march from the “Planet of the Apes” movie, and say things like “Ape like shiny.” They organise “raids” – days on which everyone buys together.

The group’s founder, Ivan Bayoukhi, is a 24-year old former car salesman living with his parents in Alberta, Canada. “NOW IS THE TIME TO WAKE UP AND TAKE THE POWER BACK IN THE HANDS OF THE PEOPLE,” says https://www.reddit.com/r/Wallstreetsilver/comments/mlpxev/now_is_the_time_to_wake_up_and_take_the_power one of his characteristic posts.

Silver costs around $26 an ounce. Stackers think the price will rise as inflation erodes the value of currencies, demand for silver rises, and supplies run short. Some say that by buying up bars and coins, they can jack up prices by 100% or even 1,000%, to the point where they can call the shots against the so-called bullion banks, the large financial institutions which lead trade in precious metals.

A March post Our time draws nigh…keep stacking and we will win the day! : Wallstreetsilver pictured silver coins laid out to spell a message to the head of JPMorgan Chase & Co, a U.S. investment bank which dominates the bullion trade: “KISS MY ASS JAMIE DIMON.” JPMorgan declined to comment.

“In a year or two we will have millions of people in the movement,” Bayoukhi told Reuters. “And then it will be over for the bullion banks.”

“CORNER THE MARKET”

Prices of silver and gold, which are traditionally seen as safe stores of wealth, have risen since 2019: Gold is up around 40% and silver around 70% since then. The silver stackers are joining millions worldwide who believe currencies are vulnerable – a fear that has grown as governments borrowed and printed money in the pandemic.

“It scares me every day when this bomb will burst,” said Tim Hack, a 23-year-old stacker in Germany. “Silver and gold really have intrinsic physical value that you can even feel when you hold it in your hand.”

Posters on Reddit joined the silver fray on Jan. 27, when posts appeared on WallStreetBets saying that if enough people bought the metal, they could push prices to the moon.

“Corner the market,” said one.

Adding to the impetus was an argument put forward on Reddit that big banks trade huge quantities of paper contracts for silver that they don’t have in their possession, keeping prices lower than they should be.

In some ways, that’s correct.

Contracts representing around 800 million ounces of silver are active in the New York futures market alone – more than twice the amount the exchange says is in its registered vaults, not all of which is available for delivery. Much of the silver that banks buy and sell in London, another big trading hub, is borrowed, bankers and traders say.

If every professional who owns silver on paper called in their dues at once, there wouldn’t be enough metal on hand, they agree. The system works because most people with contracts don’t want actual metal, which they’d have to pay to store and insure. They are speculators, or miners and jewellers, hedging their risks.

After the posts on WallStreetBets, around $3 billion rushed into a fund run by asset managers Blackrock that stores silver for investors. Blackrock said it added more than 100 million (adds dropped word) ounces of silver to its stockpile in three days. Silver’s wholesale price jumped nearly 20%.

Much of the silver stored for Blackrock is in London. The London Bullion Market Association (LBMA), an industry body, later said that there had been “concerns that London would run out of silver.”

Blackrock told Reuters it did not track where the money had come from.

The Reddit group’s founder Bayoukhi said he watched with growing excitement, turned to his father and said, “Why don’t I start a Wall Street silver community?”

“FAMILY FOREVER”

There’s also truth in Redditors’ claims that big players can influence the silver market. One trader tactic is spoofing – sending out fake buy or sell orders to shift prices before completing the real trade.

In 2020, JPMorgan paid $920 million to U.S. authorities to settle charges that its staff sent “hundreds of thousands” of fake orders into precious metals and Treasury markets. The bank said at the time that the people responsible had left and it had improved its compliance systems. It declined further comment for this story.

But the impact of spoofing lasts only seconds or minutes, said Ross Norman, a London-based former precious metals trader.

The January squeeze lasted three days. Then WallStreetBets returned its focus to stock markets; silver calmed. Since early February, the price of silver has fallen by a dollar.

Undeterred, Wall Street Silver issues a deluge of tips, analysis, memes, photos and encouragement. It is only Reddit’s 3,783rd biggest community, but it is frequently in the top 20 for volume of posts per day.

When a new member posts, Bayoukhi often responds https://www.reddit.com/r/Wallstreetsilver/comments/o92fmi/silver_is_a_national_security_commodity_covertly saying, “You are now family forever.”

“HELL OF A TIME”

Reddit buyers sit at the end of a fat silver pipeline. Only about a quarter of the 1 billion ounces or so that are produced each year is used to manufacture the bars and coins that most of them are buying, analysts say. Most of the rest is used for jewellery and in industrial applications.

Michael Mesaric, who runs the world’s largest gold and silver refiner – Valcambi SA, in Switzerland – says the 1,000 ounce bars of silver used in the wholesale market are plentiful: For small investors to think they can corner the market is “entirely wrong.”

“They can engineer a squeeze on products,” he said. “But silver in total? They’ll have a hell of a time.”

Investors will stockpile a lot of silver this year, but less than in 2020, according to consultants Metals Focus. Demand in the West is strong, but in India, one of the biggest silver consuming countries, the pandemic is reducing people’s ability to buy, they say.

Funds like Blackrock’s stockpiled 331 million ounces – the most ever – in 2020, Metals Focus said in a report for the Silver Institute; bar and coin buyers took home 200 million ounces more. This year, the consultancy expects funds to hoard 150 million ounces – the second highest level ever – and bar and coin buyers 253 million ounces.

Silver coins and bars can certainly hold their value. Higher inflation should lift prices, as will rising demand from makers of goods like electronics and solar panels, said Rhona O’Connell, an analyst at traders and brokers StoneX.

But she, and others at companies that trade the metal, think predictions of $1,000 an ounce are out of this world.

Of 39 analysts and traders polled by Reuters in April, only seven thought silver prices would average $30 or more in 2022. The highest average that they forecast was $44.

Redditors are unmoved. Kraker, the restaurant worker, has begun reading obsessively about inflation, money supply and other economic data. “There is a monster around the corner,” he said. “I’m trying to sharpen my stick.”

(Peter Hobson reported from London; Edited by Veronica Brown and Sara Ledwith)

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Emerging Markets Outlook: Investment is strong, but uncertainty remains – Logistics Management

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The $4.9 trillion global logistics market operates as the backbone of international trade, which grew 272% from 2000 to 2021. Expectations for the global logistics market to grow to $6.55 trillion by 2027, coupled with continued growth in e-commerce and the rebound of contract logistics, has companies looking to reimagine their logistics operating models.

However, companies continue to deal with disruption from the pandemic, which has now been further complicated by the war in Ukraine. In fact, a recent Accenture report found supply chain challenges arising from the pandemic and Russia’s invasion of Ukraine could result in a potential €920 billion cumulative loss to gross domestic product (GDP) across the Eurozone by 2023.

Because of these complications, supply chain networks need to be more flexible and efficient while building resilience, relevance and sustainability into the core. Supply chain networks are often more global—not less—with companies using factories that are higher tech, smaller, more numerous, more local, and closer to customers.

As companies build these networks, they’re investing in digital capabilities to enhance service levels and control costs—and they’re also looking to omni-channel fulfillment platforms with dynamic order allocation capabilities to meet ever-changing customer demands.

Transforming with the latest technologies and ensuring resilience and sustainability are embedded throughout these supply chain networks will make companies future-ready and better equipped to managed potential disruptions.

The expansion of emerging markets is an important consideration. As companies look to uncover new channels for growth, they’re continuing investment in emerging markets.

Disruption: Supply chain shocks and the accumulation of disruption

Depending on the length and severity of the war, the cost of supply chain disruption in the Eurozone across 2022-2023 could amount to € 242 billion (2% of GDP) in an ongoing war scenario or € 920 billion
(7.7% of GDP) in an protracted war scenario.

Logistics Breakdowns
• Transportation bottlenecks worsened input shortages and sent costs skyrocketing.
• Continued lockdowns in Chinese ports and war in Ukraine further strain the issue.
• 90% of Ukraine’s wheat exports have halted due to port closures. Ukraine accounts for nearly 10% of global wheat exports. Wheat prices hit record highs, rising 30% in 2021Q1 on previous quarter.

Energy Security 
• Energy markets were already undersupplied before the war given the economic recovery.
• The war in Ukraine has caused further oil and gas price spikes: the price of brent crude oil could peak at 115 USD per barrel in 2022.
• Suppliers are shutting down some operations becauseenergy costs are too high, which creates another wave of input supply shocks.

Lack of Material Supplies
• Resurging demand and initial precautionary hoarding led to inflation and overwhelmed supply chains.
• The concentration of suppliers for critical minerals and food is compounding challenges.
• For example, Russia is one of the largest suppliers of palladium, platinum and diamonds, while Ukraine is the critical supplier for neon gas, agricultural products, and metal ores.

A Tight Talent Market
• Labor and skill shortages plagued most industries.
• The war has created further tension in targeted skills areas like transportation.
•14.5% of the global seafarer workforce are from Russia and the Ukraine.

Thailand

Thailand continues to make large strides in their economic development. Logistics investments have been fast-tracked as the country obtains more market share.

Thailand had previously broken ground in 2021 on mega-projects worth $5.3 billion to improve national infrastructure focused on roads and rail. This is highlighted by a rail line that will better connect six provinces within a 50-mile radius to Bangkok. Supporting urban sprawl in Thailand is now imperative as the people of Thailand continue to prosper despite economic setbacks associated with the pandemic.

In total, Thailand has $60 billion planned in spending to help support The Ministry of Transport’s 40 mega-projects. Year-over-year, Thailand was able to jump three spots up on Agility’s Emerging Markets Logistics Index Top 20.

Vietnam

Although delayed action from policy makers has caused Vietnam to lose logistics market share, despite prime real estate and economic growth, Vietnam is still considered to be an integral part of omni-channel growth and a large contributor to the internet economy.

Vietnam has positioned itself as key player associated in the Asia-Pacific (APAC) region, with e-commerce spend growing 24% year-over-year. As a benefactor in the U.S.-China trade war, as manufacturers are forced to diversify supply chains networks, Vietnam’s core competency is related to labor intensive industries due to their low labor cost.

With 2,030 miles of coastline, Vietnam holds a strategic position for the maritime industry, seeing a 7% growth year-over-year in twenty-foot equivalent units (TEUs). Vietnam had started to invest in the growth of a Da Nang mega-port as early as 2016, which has promised to support 27.2M tons by 2030 and 92.5 million tons by 2045.

However, Vietnam is challenged by size constraints driven by underdeveloped infrastructure, as evidenced in dropping three spots on Agility’s Emerging Markets Logistics Index Top 20.

Mexico

Although hit hard by the pandemic in 2020 with an 8.6% economic contraction, Mexico was able to make-up and surpass 2019 GDP ($1.269 billion) in 2021 ($1.285 billion). Despite economic turbulence, Mexico benefits from a strong trade-partnership with the United States as well as a private-backed investment in infrastructure.

Of the $44 billion committed, 33% is planned to go toward transportation projects, including highways, rail, ports and airports through 2024. With a trend of shippers looking to position closer to their customer, Mexico holds the highest forecast compound annual growth rate—tied with India—at 10%.

India

Like Mexico, India is projected to maintain a 10% annual growth rate and maintain Agility’s ranking at No. 2. India Goods and Services Tax, as well as private-sector investment, have been a catalyst for infrastructure improvement since its inception in 2017.

Due to this infusion of money, India has already built 3.5 million miles of roads, second only to the United States. However, India’s National Infrastructure Pipeline (NIP), a $1.2 trillion infrastructure program, will support continued investment.

Logistics related NIP calls to action are 34,000 more miles of road development; a National Rail Plan implemented by 2030 to support a multi-modal transportation solution with the goal of hauling 45% of freight on rail by 2030; and moves to address digital infrastructure to match the growing business demand and provide access to all citizens.

The Indian government is not just prioritizing interconnected transportation infrastructure, but also making a $94 billion investment in sustainability. The Jawaharlal Nehru National Solar Mission aims to deploy solar energy technologies to create favorable conditions for solar manufacturing capability.

Indonesia

Driven by government restrictions on business during the pandemic, logistics business activities have declined 50%, however current GDP growth indicates economic rebound.

The majority of the Indonesian logistics market is driven by transportation, predominantly road freight, accounting for 70% to 80% of total volumes within their borders. However, 90% of Indonesia’s exports are moved via ship.

Indonesia’s Ministry of National Development released a $412 billion infrastructure investment plan in 2019 to address the World Bank’s assessment of a $500 billion infrastructure investment gap in 2017.

Indonesia remains steadfast in its commitment to plan, aiming to finish the Trans-Sumatra Tolls Roads by December of 2022, effectively providing an additional 1,751 miles of roadway to travel on, with a commitment to complete construction of 3,000 more miles. The goal is logistics cost reduction as well as connectedness within the island to support maturing e-commerce market demand.

Malaysia

As ships have grown 2.9 times larger from Post Panamax II to Megamax-24, so must the ports that support their throughput. Malaysia now has two of the three largest ports of all emerging market countries with both ports achieving strong container volume increases in 2021.

Malaysia will look to grow port infrastructure to capture economies of scale driven by larger ships. Stating with a $179 million expansion in 2022 for the Port of Tanjung as well as multi-million, private-sector investment within facilities in Port Klang. The freight and logistics market in the region is expected to continue to grow, registering a 4% increase to CAGR through 2027.

Looking ahead

Through the end of this year and into 2023, shippers will have to continue to break the physical limits of supply chains, enabling organizations to do more with less and meet customers’ growing expectations for order fulfillment in a cost-efficient way.

Emerging themes to watch in the United States

After historic spending on freight in 2021, shippers are starting to reap the benefits of a softening truckload market. The DAT dry van load-to-truck ratio was at 4.57 in April, down 37% month-over-month and 21% year-over-year, with contractual rates surpassing spot rates in March 2022.

For the first time since June 2020, we’re starting to see normalization of route guide tender acceptance and a stabilization on spot market rates.

Shippers and carriers are shifting their concerns to the now historic rise in diesel prices. Truckload carriers and private fleet managers are
continuing to focus on basic operating efficiencies.

This includes, but is not limited to, fuel mileage being reduced by 3%, increase utilization of equipment, and implementation of electric vehicles. The question remains of how to mitigate risks related to energy consumption, which will be a theme in the United States moving forward.

Leveraging capital investment and technology to better support global logistics channels will unlock greater capacity and cost-efficiencies of emerging markets.

As shippers continue to pivot toward more and more emerging markets, supply chains need to be redesigned with economic diversification in mind, as well as sustainability and resilience. Though, keep in mind, global uncertainty and unrest will always affect supply chain networks.

Whether the issues arising are an increase in costs, a shortage of labor, or additional trade barriers, shippers need to quickly pivot to reimagine, build and operate supply chain networks that orchestrate change, simplify life, and positively affect business, society and the planet.

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What is Causing Bitcoin’s Price to Plunge?

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The cryptocurrency industry’s inaugural asset is experiencing one of the biggest downturns in its short history. Bitcoin has recently fallen to its lowest value in the last year-and-a-half. Having peaked at a value of $70,000 per Bitcoin in November 2021, almost $50,000 has been shaved off its value per Bitcoin in the last seven months. As of 15th June 2022, it has been trading at around $21,400 per Bitcoin. What’s happening and why is the Bitcoin crash causing a ripple effect throughout the rest of the crypto scene?

Crypto analysts believe the real-world problems of surging inflation and rising interest rates are having a knock-on effect on crypto values. With stock markets also threatening to enter a bear market, it’s possible that a big reason for the plunge in Bitcoin is that many investors in BTC have chosen to liquidate their positions and stockpile as much cash as possible as a safety net. Despite the difficult backdrop for Bitcoin right now, it’s still an asset that retailers are keen to accept and utilize as part of their cash flow.

In Canada, there are still plenty of businesses and merchants that accept Bitcoin and other cryptocurrencies as legitimate forms of payment. For example, in the newly regulated Canadian iGaming market, brands like Bodog make it possible for Bitcoin holders to play casino slots for real money, with deposits permitted in Bitcoin, Bitcoin Cash, Bitcoin SV, Litecoin, Ethereum, and USD Tether. Major Canadian gift card brands like Coincards and CoinGate also permit Bitcoin transactions in exchange for gift cards with the biggest names in retail and e-commerce, namely Amazon and Walmart.

In addition, online travel agents like Travala still accept Bitcoin, with discounts worth up to 40% available to those booking flights and trips with cryptocurrency.

Other crucial developments affecting Bitcoin

In recent days, two of the most prominent names in cryptocurrency trading and investing have experienced severe issues. Binance, the world’s most liquid cryptocurrency exchange, was forced to cease Bitcoin transactions for several hours. The platform attributed this hold-up to a “stuck transaction”, although many have since looked upon this excuse with skepticism.

Additionally, the collapse of decentralized finance (DeFi) platform Celsius has been a dagger in the heart of many in crypto circles. The “extreme market conditions” have raised serious question marks over Celsius’ long-term future, with its liquidity drying up fast. The firm takes cryptocurrency in exchange for annual yields on investor deposits, but if there’s no yield to back this up, the concept folds like a pack of cards.

Is it possible to anticipate a recovery for Bitcoin and crypto?

In truth, Bitcoin and all other cryptocurrencies are entering unchartered territory at present. Consumer and retail investor behaviours are changing as confidence in real-world economies diminish by the day. Analysts insist that extreme caution must be taken to enter the markets right now. With very little historical data to fall back on, the price of Bitcoin remains volatile.

Although there is a general feeling within the cryptocurrency community that a “pump” will return sooner or later, it’s going to take time for demand to outstrip supply once more.

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Rothschilds hires RBC's Graham to run Canadian investment bank – The Globe and Mail

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Rothschild & Co is scaling up its Canadian business, hiring veteran Royal Bank of Canada dealmaker Alex Graham to lead domestic expansion at a global investment bank with a two-century family pedigree.

On Monday, Paris-based Rothschild will announce that Mr. Graham will be its Toronto-based managing director and head of Canada, with a mandate to move beyond the bank’s current focus on advisory work for the mining industry and restructurings. For the past decade, Mr. Graham was head of RBC’s telecom, media and technology group in Canada, then Europe.

“Alex has strong professional roots in Canada and a global network of relationships,” Jimmy Neissa, head of Rothschild, North America, said in a release. “His experience, knowledge and leadership will serve our clients well and further grow our leading franchise in the region.”

Mr. Neissa joined Rothschild in 2016 with a mandate to build its North American operations after spending two decades as New York-based merger and acquisition (M&A) specialist at UBS and Donaldson, Lufkin & Jenrette, where Mr. Graham also worked. Previously, Mr. Graham also led the diversified industries team for Morgan Stanley in Canada and worked for Citigroup in New York.

Last year, Rothschild ranked sixth among investment banks for M&A in Europe, advising on 464 transaction, and was 15th among North American banks on M&A, working on 220 deals, according to data service Refinitiv. Rival European banks with significant North American operations include Barclays, while Deutsche Bank, Credit Suisse and UBS have scaled back in the region in recent years.

Rothschild is building out its Canadian team at a time when large Canadian companies and fund managers such as pension plans and Brookfield Asset Management Inc. are using international M&A to build their businesses. The investment bank currently has 10 professionals in Canada.

Rothschild plans to hire Canadian financiers with expertise in M&A for banks and financial services businesses, technology, infrastructure and power companies, and link these local bankers with its international expertise, Mr. Graham said.

“With Rothschild’s strong momentum in North America, along with its continued strength and deep bench of expertise in M&A advisory around the world, I’m honored to have the opportunity to lead and continue to grow the business in Canada,” he said in a release.

Prior to becoming an investment banker, Mr. Graham worked in Ottawa as an adviser to Prime Minister John Turner. He holds an MBA from Western University’s Richard Ivey School of Business and an undergraduate degree from Trinity College at the University of Toronto.

Rothschild has deep roots in Canada, serving as the financier that backed development of the massive Churchill Falls power project in Labrador in the 1960s. More recently, former securities lawyers Gar Emerson and Montreal-based investment banker Daniel Labrecque served as country head in Canada.

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