14 January 2021

1) Bitcoin, the digital currency, hit an all time high of $41,000 per coin, but Bitcoin as well as the other cryptocurrencies, has a history of volatility and is unregulated. After hitting a record high in December of 2017, Bitcoin plunged 50% the first month of 2018. There are now warnings that Bitcoin is a massive bubble waiting to collapse in the near future. There are upsides to cryptocurrencies, such as the need to not deal with a bank, but it also makes the currency’s future uncertain. The biggest risk to owning Bitcoin is the possibility of being banned, and this has already been done with other cryptocurrencies. The IRS considers Bitcoin property, not currency, which means there are tax consequences. If you hold the bitcoin for a year or less, any trading profits are taxed as short-term gains, at the same rates as ordinary income. But if you hold it for more than a year, your profits are taxed as long-term capital gains, at rates of 0% to 20% in 2021 depending on your income level. The IRS has more recently been going after cryptocurrency holders who aren’t reporting their digital currencies.

2) Fears of a Bitcoin bubble bursting increased as Bitcoin fell with $170 billion dollars wiped out in 24 hours as Bitcoin pulls back by over 11% from a day earlier to $35,828.06. The sell off of cryptocurrencies comes after a huge rally and perhaps signaling some profit-taking from investors. The $40,000 mark could have been a trigger for profit-taking.

3) Americans are asking what really happens when there’s a 50-50 split in the senate? With the vice president a democrat, the democrats hold the narrowest possible majority which leaves some major obstacles and mine fields for the party. The senate cloture rule requires 60 members to end debate and vote on most topics, which in practice will allow the republican to filibuster much of the democrats’ legislative agenda. This is how the 50-50 split is likely to work in real life, the first hurdle is the organizing resolution, which determines everything from committee membership and staff budgets, to who gets the best office space. But in these hyper-partisan times, agreeing on even the rules of the road may be tricky. In theory, senate democrats could change the cloture rule and abandon the need for 60 votes, which would kill the filibuster. There will be further problems when the votes are not along party lines, and senators vote their minds.

4) Stock market closings for – 13 JAN 21:

Dow 31,060.47 down by 8.22
Nasdaq 13,128.95 up by 56.52
S&P 500 3,809.84 up by 8.65

10 Year Yield: down at 1.09%

Oil: down at $52.87

12 January 2021

1) The cryptocurrency Bitcoin plummets the most since March as a stronger dollar and investor nerves strip off nearly $140 billion in the cryptocurrency market cap, renewing fears that Bitcoin may be a bubble waiting to burst. But Bitcoin is still up roughly 89% over the past month. Other cryptocurrency coins, such as XRP and Litecoin, have shed about 18% each. Bitcoin hit a record high last week above $41,000, driven by the combination a weaker dollar, economic optimism, and a wave of bullish sentiment toward cryptocurrencies as big-name investors and investment banks touted a potential for huge gains this year, with the stronger dollar and higher bond yields triggering a plunge in Bitcoin and gold prices.

2) Trump has been permanently barred from the platform Twitter, resulting in$5 billion dollars in losses in market value, with Twitter stock dropping after the barring of the President. Twitter stated they permanently suspended the account due to the risk of further incitement of violence. Trump, who had about 88 million followers, generated enormous publicity for the platform with his controversial and incendiary tweets over the past six years. As a result, Twitter’s stock fell as much as 12% on Monday thus the decline of $5 billion dollars from Twitter’s market capitalization. Investors are worried that the Trump ban will erode interest in the platform and lead to boycotts among those who see the decision as politically motivated and a way to silence a major conservative voice.

3) Fears are growing that a bigger stimulus may be seen as the ‘peak of this bubble’ resulting in a market correction or worst. Some think that with the Democrats set to take control of both the House and Senate, perhaps President-elect Joe Biden will be less likely to spook markets with tax ambitions. Biden has promised $2,000 stimulus checks if the Senate turned blue, so now the question is what will happen? For millions of Americans, it’s been a painful waiting game already, they having subsisted with minimum money since losing their jobs from the pandemic. Joe Biden made the promise that if Jon Ossoff and Raphael Warnock turned the senate blue that would end the block in Washington and allow the $2,000 stimulus checks to immediately go out the door to people who are in real trouble.

4) Stock market closings for – 11 JAN 21:

Dow 31,008.69 down by 89.28
Nasdaq 13,036.43 down by 165.54
S&P 500 3,799.61 down by 25.07

10 Year Yield: up at 1.13%

Oil: down at $52.18

22 July 2020

1) China, with the second largest economy in the world, is steadily developing into a technological powerhouse that could upend the status quo. China’s ten year plan called “Made in China 2025”, has a principle goal for China to catchup, then surpass the West in various technological fields. Some consider this not only threatens the U.S. economy, but the world economy too. China has already declared they intend to be the dominate power in the world by 2050, and having the high ground in technology development is a key milestone in that quest.

2) Some consider that the stock market will likely head upwards to a new high, fueled by borrowing and money printing. With another stimulus package in the near future, it is ‘out of fashion’ to consider how the borrowed money will be paid back. The central banks, who are not elected, stand ready to print as much money as is wanted, no matter that historically this is how inflation is created and fuel. Example is the Weimar Republic (Germany) who induced their great wave of hyper inflation by printing massive amounts of money in the 1920’s, that lead the way for the Nazi’s to ascend to power. Other problems stemming from printing too much money is currency depreciation, difficulties borrowing, higher interest rates and social unrest. With other investments limited, the excess of money goes to the stock market, thus pushing the market up, and possibly into a bubble just waiting to pop!

3) The Congress remains busy crafting a second stimulus package with lots of debates what should and shouldn’t go in it, intending on having a deal worked out by the end of next week. However, this could go into August before a bill is ready to sign. A major point of contention is checks vs taxes. Should stimulus be checks like the $1,200 checks given out a few months?. If checks, then who gets them this time and how much? The other strategy is reducing payroll taxes, but this only helps those who are working. The Republicans are proposing a $1 trillion dollar relief strategy, while the Democrats propose a sweeping $3.5 trillion dollar plan. This would add to the $2.9 trillion dollar package already implemented early this year. As usual, everything is being done will little to no real analysis, instead relying on gut feelings of lawmakers in making the future of America.

4) Stock market closings for – 21 JUL 20:

Dow 26,840.40 up 159.53
Nasdaq 10,680.36 down 86.73
S&P 500 3,257.30 up 5.46

10 Year Yield: down at 0.61%

Oil: up at $41.58

SOUTH FLORIDA HOUSING MARKET IS HOT……..MUY CALIENTE!!!!!!!!!!!!!!!!!!!!!!

south florida market

By Economic & Finance Report

The South Florida housing bubble continues to rise on a national scale.  GSE (Government Sponsored Enterprise) Freddie Mac  has indicated that the South Florida housing market continues to incline on national index data. 

On data provided by Freddie Mac, South Florida homes is in the 80% percentile range as far as increase of bought homes regionally and nationally. Palm Beach, Broward and Miami-Dade counties had the highest score amongst the counties in Florida. South Florida is also improving in development of the home landscape nationally as well, as far as on time mortgage payments by home owners, and as the housing market rebounds on major demographic fronts.

Reporting by Zillow presented that South Florida only lost 16% of the housing market compared to 27% on the national scale.-SB