Brexit Benefits? & China's Crosshairs on Crypto



welcome to boom-bust broadcasting around the world in covering the world of business and finance and the impact on us all I'm Ben Swan filling in for Bart Chilton in Washington glad you're with us straight ahead Briggs it continues to loom heavy over the United Kingdom but could the messy no deal split benefit of power across the globe Richard Wolffe professor of economics emeritus at the University of Massachusetts Amherst lends us a hand to sort through the turmoil and how the trade war is spilling over with some dire consequences plus bitcoin is booming right now in fact today another very big day but as it continues to rise China has the crypto in its crosshairs Taylor Letterman of simpler trading joins us to delve into the dooming details for the cryptocurrency all of that directly ahead but first let's do some headlines and we begin right here with a five billion dollar plan to get state banks back in the black the finance minister of Turkey unveils the government's plan to help move defaulted debt off of their books the finance minister who is the son-in-law of President Erdogan announced the sale of four point nine billion dollars worth of bonds to finance retirement of non-performing loans from the portfolio's of turkeys state banks and to increase systemic liquidity the finance minister warned of more red ink ahead estimating that the percentage of non-performing loans and state banks now at four point two percent could rise as high as six percent the minister also said that two special funds will direct proceeds from the bond sell to energy and construction sectors Turkey is profitable and politically connected construction sector is a product and an emblem of Turkey's past years of strong growth fuelled by stimulatory monetary policies but now Turkey is officially in a recession and policymakers are trying to manage problems including two hundred billion dollars in foreign currency debt and a substantial slide in the value of the Turkish lira in currency markets well moving west from Turkey across the Balkans to Italy the Italian Treasury has downgraded their national GDP growth forecast for 2019 to just 0.2 percent that figure is a downward revision of the projection made in December and that was of a flat percent at the same time the Italian Treasury also says that their budget deficit will increase relative to GDP from just above 2% to 2.4 percent that lower level of deficit to GDP that was the product of a short but nasty spat between the right-wing coalition government and the European Union which threatened the government over the determination to enact campaign promises that they made to Italian voters the new deficit of GDP ratio roughly matches the one that provoked the fight with the EU in which the Italians ultimately back down Italy and the EU now seem positioned for continued friction and frustration over fiscal policy well here we go again the UK is looking for another delay on brexit Prime Minister Theresa May will request a new deadline of June 30th when she meets with EU leaders today for an emergency summit in Brussels so this Friday is the new brexit deadline the March 29th deadline that was obviously missed UK prime minister Theresa May will now ask that brexit be delayed until June 30th but there is a problem here you see the new brexit deadline April 12th this Friday was decided upon because it is the latest point at which the UK must declare its intention to stand in European parliamentary elections or not if the UK is still an EU member state on May 23rd that it must feel candidates in that poll joining me to break it all down Richard Wolffe professor of economics at the University of Massachusetts Amherst and also the author of democracy at work a cure for capitalism Richard welcome thank you very much glad to be here so let's begin here Theresa May is gonna ask for this delay until June 30th but it looks like the EU leaders may instead offer a year delay the concern is that again as if these parliamentary elections were held then the brexit takes place and then UK representatives might be seen some are saying as a Trojan horse of sorts is that correct yes so the the European Union does not want to give Britain a say in a unity of Europe that they have refused to be part of and that unity requires open borders to let you continental Europeans come to England for jobs and other things it deals with again the same issues that prompted Britain the catastrophe here is that the wobbling of the British is threatening together with other things the whole project of a unified Europe and that's what's in the balance as they negotiate back and forth so when Theresa May goes in and suggests this June 30th deadline our chance is pretty strong then that the EU leaders are gonna say no we see they're gonna have to be a full year or get it done by Friday I think so I think by now the Europeans are discovering that the worst thing about brexit is not whether it happens or whether it doesn't happen but the worst thing is the uncertainty around it nobody knows whether to make an investment in one part of Europe or another because they don't know what Europe will mean in terms of where they can sell and where they can buy and what kind of profits they can make so they want something settled instead of this endless soap opera of the British turning in on themselves around the subject that most of the rest of Europe doesn't care about that much one way or the other yeah the rest of Europe probably doesn't care as much and yet you're talking about uncertainty certainly in the case of the EU the European Union there's also a lot of uncertainty for the people in Britain as well they business owners there in Britain struggling with exactly what this means so well so how important is it in terms of just a British economy itself to figure something out here get a deal done of some kind so at least whether it's a good deal or a bad deal at least there's a deal uncertainty well the biggest thing is the uncertainty most British people and businesses want the uncertainty resolved they now regret that they have been wasting years several years now fighting back and forth nobody really remembers exactly why the whole issue was raised many of those who voted for leaving Europe are now positioned themselves they were there for staying in Europe so yes I think the basic question is get this resolved because it's not the fundamental problem of England that's its position in the world and in or out of Europe will affect that but it's not as fundamental as the other issues that have put put on the back page as they go through this internal convulsion over and over again so there is a new study Richard from the United Nations conference in trade development that claims that China would be the big winner should the UK leave the European Union without a deal Chinese exports to the UK could actually boost by ten billion dollars or 17% of its current exports in the country US exports would actually rise some five point three four billion and Japan would gain four point nine billion certainly there are some nations that might be hoping for no deal brexit China obviously would be the lead of those well I think the issue here is that the world is now shaped by training blocks one is the United States one is China and the third big one is Europe or it was if the Europeans fracture partly by the brexit the disaster already and particularly more so if they now leave but you also see it in Italy as per your comment earlier the Italians have cut their own deal with the Chinese already if you fracture up Europe if France or Germany begin to see that they're gonna have to choose sides a it's not clear which way they'll go with the US with mr. Trump whom they don't like with a destroyed Britain which they're watching or with the ascending China we could see a dramatic reorganization of the world politically and economically because one of the big power blocks Europe is literally falling apart well speaking of China the us-china trade war is reportedly straining this ship's gears just a little bit but straining Taiwan's economy Taiwan's exports fell for the fifth straight month in March in fact exports are in the negatives domestic demand is not strong enough there it looks like Taiwan is about to enter a recession and a lot of that may be the result of this us-china trade war am i correct on that yes you are absolutely correct here's the way this works when mr. Trump begins this process by slapping tariffs to punish the Chinese or at least to be appearing to do so the Chinese respond that reduces trade between those countries with them not trading as much with one another they in turn can't trade as much as they did before with all of the other countries because for example if you can't export goods from China to the United States then China in turn will not import the inputs to what they produce for America people don't think about that but many of the inputs in mainland China come for example from Taiwan so that this ramifies and if you have an economy like Taiwan totally dependent on exports it's a little Blaz then that could have a bigger effect on that kind of economy than it does on the two big ones that are fighting it's like two giants fighting and they the overflow of fact is very damaging for the smaller people around them and that's gonna shape and change world economies in dramatic ways the longer this kind of trade war continues and we only have about a minute left but I want to get your input also on this latest announcement President Trump talking about putting another 11 billion dollars in tariffs on Europe you know we're talking about tariffs what do you think will be the result of that well it's going to make the Europeans even more upset and hostile to the United States it's gonna make them more receptive to cutting deals with China which is easier now for them to do but most important people should understand with the beginning of Trump it was Canada and Mexico and he was gonna punish them for cheating when that was over and the headlines were done it was China we've had a year of that now that the China thing is winding down he's gonna go after Europe people should understand this is a hyped theater the end changes in these relationships are small this is about distracting folks from the real problems of the United States into this psychodrama this soap opera of a mr. president protecting us against the cheating foreigners it's really sad to watch the attention it gets and the distraction that it basically is so much of politics is theater Richard Wolffe professor of economics emeritus at the University of Massachusetts Amherst and the author of democracy at work thank you very much for your time thank you for having me well the CEOs of the United States biggest banks testified before Congress remarkably for the first time first time since the 2008 global financial crisis the current and in some cases former chief executives of Bank of America Bank of New York Mellon Citigroup Goldman Sachs JP Morgan Morgan Stanley and State Street yes they were all there appeared in the hearing of the House Financial Services Committee on the topic of holding mega banks accountable again this hasn't happened since 2008 the committee's chair representative Maxine of California opened the hearing by asking of regarding the CEOs and the bank's quote a decade later what have they learned are they helping their customers and working to benefit the communities they serve or that are the practices of these banks still causing harm in quote well the hearing then opened up for a barrage of more pointed questions from committee members on issues including excessive CEO pay and overdraft fees JP Morgan CEO Jamie Dimon told members of the banks that they are now more financially stable large banks Moe has doubled the highest-quality capital to protect against losses under the feds most extreme stress testing scenario the combined losses of all the 34 banks is only 6% of total capital well yesterday we discussed Saudi Aramco's major bond offering while the oil giants bond sells shattered records u.s. president Donald Trump traveled to Texas to unveil an executive order to expedite construction of oil pipelines the US remains the world's leading global oil producer and the trump executive order is sure to shore up even more of that chair if it's implemented well still more to come when we come back Bitcoin is booming right now it's booming as we speak but as it begins to rise China has the crypto in its crosshairs Taylor Letterman of simpler trading joins us to delve into the dooming details for the cryptocurrency and as we go to break here are the numbers at the closing bell well welcome back uber is racing to catch up with rival lift in the IPO lane the ride-hailing service reportedly planning for initial public offering to launch next month now it's working around evaluation for the company get this of about a hundred billion dollars The Wall Street Journal reports that uber is showing company insiders their math on paper based on that valuation for an opening stock share price between 48 and 55 dollars and an initial sell of 10 billion dollars worth of stock uber is reportedly planning on moving forward with needed registration paperwork on Thursday rival lifts IPO is casting a bit of a shadow on uber as big debut not only because they beat uber to the punch but because of the mixed results of lyft stock rollout live stock launched at 72 dollars and has flag since then sliding towards 62 dollars in trading earlier today and in other tech in commerce news Airbnb has reneged on their pledge to stop listing locations in illegal settlements in the occupied West Bank in November of 2018 activists applauded the online property rental companies decision under pressure to remove listings in West Bank settlements Airbnb reversed their position after a threat of a lawsuit from settlers and they say that they will list locations but then donate the profits Israeli Prime Minister Benjamin Netanyahu who seems to have secured a narrow but sufficient margin of victory in this week's is a Israeli election has pledged to formally annex the illegal settlements all right let's talk crypto currencies now China is considering banning Bitcoin mining the country's National Development and Reform Commission is proposing that ban calling Bitcoin mining seriously wasted resources those are their words Bitcoin mining does require large numbers of computers dedicated to crunching out blockchain numbers banning Bitcoin mining though that's not really the same thing as banning Bitcoin entirely joining me now to discuss is Taylor Letterman a cryptocurrency analyst with simpler trading Taylor thanks for being here thanks for having me so when 2017 China bang cryptocurrency exchanges that serve local people that caused the plunge in prices but obviously that's a very different situation than banning Bitcoin mining even so if this proposal was passed would you expect to see Bitcoin dip again yeah I would say somewhat a pullback but even though the proposal is being proposed that's currently and being consulted on we've actually seen Bitcoin go higher today so we wait to see as we approach I think may 7th is the deadline for the consultations around this proposal but again this is not even the first time we've seen proposals to ban Bitcoin mining in China we saw the same thing last year last January come out and this one was kind of pushed by the Chinese central bank's so that it's something to consider when we see this is nothing has been done in 2017 2018 but now this new proposal by the planning committee we'll see how they progress with it overall I think a lot of the mining is starting to diversify out of China we're starting to see some of that occur but also I think it would be very hard to regulate a lot of the operations in China are going to be small and there some we're gonna be even ran off private hydroelectric or renewable resources where it's harder for the government to kind of step in and one know that they're mining but also to regulate that and then they benefit the local regions as well because taxation and so on employment to these mining farms so there's a lot of impact on the economy if China does attempt to ban mining well in terms of banning mining – wouldn't that some levels actually cause the price to go up simply because you're not getting rid of or banning the use of cryptocurrency but you're you might be slowing down the growth of that market there's only what like seventeen million Bitcoin in circulation and that would mean that the value of the other bitcoins that are already out there wouldn't wouldn't that rise as a result right so we'll start to see the mining there and China if it is banned I think it's gonna be that void that we'd potentially see in the hash radar the mining capabilities of Bitcoin I think it will be bought up quickly we'll start seeing other mining farms set up shops expand because there's more opportunity to mine and so whatever we see a reduction in mining in Bitcoin I think it's gonna be crossed over real quickly as more the businesses start taking advantage of that ban in China and then other nations in countries States begin to mine bitcoins pick it up let's talk about bitcoins price because today's a happy day if you like Bitcoin obviously the price over fifty four hundred dollars it's the first time we've seen that since November of last year and it just keeps going in up in fact if we take a look at this chart here we see that though you know the one year versus the seven day last seven days the last two weeks really have been pretty exciting we had that single buyer purchase about a hundred million dollars in bitcoins spread across a number of exchanges the price has been able to hold above 5,000 now above 50 for possibly moving to 55 even 5600 where do you see big hug Bitcoin going over the next few months yeah I think all eyes right now especially us as simpler trading where I in that 6,000 dollar level that's gonna be where we saw Bitcoin there initially decline as we broke down to 3,000 and anyone that didn't already sell or exit the market capitulated and left sold their position at loss I think we've kind of reached that point I don't think anyone's gonna be trying to sell our breakeven at 6,000 so what we're looking at the supply on 6,000 is gonna help pump Bitcoin up higher but it's still gonna be major resistance so it's gonna take a lot of effort in the market the Bulls are gonna have to come to work I'm really trying to push Bitcoin over that level so it's something to watch especially over the coming weeks I think we will want to see some consolidation in the market a volume it volume is still quite high rivaling what we saw in our late 2017 as Bitcoin broke to 20,000 so right now what we're gonna see is a bit of consolidation help kind of neutralize some of the buying and then see how we progress going into the success of that level that's gonna be key going for with the crypto one day yeah it doesn't dollar big one if we can put that that graphic backup of the the year-long graphic because for folks at home if you don't know exactly where that that dip is if you see that major dip there that's where a Bitcoin kind of as Taylor was mentioning went off a cliff if you will from a little over 6,000 dropped down dramatically to about the three thousand four thousand mark and then it's kind of hovered there and now coming back up so for Bitcoin there is a resurgence but as Bitcoin goes so goes many alt coins and all coins are doing pretty well again for those of you who don't know there is Bitcoin and then everything else every other cryptocurrency in the world is considered an all coin kind of lump together alternative coins the Bulls are starting to move pretty heavily into that altcoin space Taylor at this point and we're seeing a rise pretty much across the board Bitcoin cash like coin etherium over 180 today all coins seem to be doing better but the the barrier to entry to get into those coins obviously a lot smaller right than it is to get into Bitcoin yeah some of the Ulta Queens have a bit or a lot less liquidity than Bitcoin of course but as we progress down and market cap is that's where we get more the illiquid all coins but I think in the top 20 top 25 in terms of coins based off market cap so the overall market capitalization of those wins I think the higher ranked ones are gonna quickly follow and bond Bitcoin we've been seeing that like you said light coin aetherium I've been following in bitcoins footsteps Bitcoin moves up they follow and quickly kind of try to close that gap in percentage gain and so on but we want to start seeing as we see Bitcoin put beginning consolidate we'll start seeing risk move to some of these Alta points so we're start seeing more money flow to the alt coins and we'll start seeing those kind of pump even higher so we're seeing ten percent gains fifteen percent gains we'll start seeing those 30 40 percent gains again once we see Bitcoin kind of consolidate a certain level so that again that 6,000 dollar level is gonna be key in Bitcoin and that's gonna fuel the ultimate market so to many people when they when they hear about Bitcoin they hear about all coins think all of its about currency and it's not obviously blockchain based technology decentralized businesses they were taken off at the beginning of 2018 these are businesses that really use blockchain to reinvent technology used in a variety of applications from real estate legal services even gay I mean across across the board here so Taylor a lot of these blockchain based entities were slowed down by the crypto winter especially getting an investment into them when do we expect to see investment begin to flow into those companies again I honestly don't think it's stopped in terms of investments into those companies what we did see in 2018 or as we closed out 2018 and now in 2019 is a shift and how investors are approaching the blockchain space in crypto sector is we're certainly seeing more investments in terms of equity in companies rather than into a token based investment so token based investment I'm buying a cryptocurrency I'm buying the actual digital asset but we're actually seeing more investors approaching the company behind the digital asset and investing into that company in terms of equity so we're starting to see more money put into the companies and less companies launching these ICSI cos are kind of what could be partially blamed to the downfall or at least a bear market we witnessed in crypto in 2018 but I think there's a shift in that perspective now and so we're looking for those projects that have survived 2018 and steadily continue to development to despite the pressure of the crypto winter on them so we're looking for those companies that kind of progress through that and we're still seeing money flow into that especially institutional money we've seen progress and custodial ship with fidelity we've seen actually pension funds invest in some Morgan Creek 40 million dollar crypto fund and we're seeing more and more progression in the retail space towards investments in crypto and that's not just in terms of going on exchange and buying aetherium or an old coin that's actually investing in the company and the people behind the project that's right taylor letterman cryptocurrency analysts at simpler trading thanks so much for your insight always a pleasure and folks before we go I just want to remind you I mean again this is the one year chart and this mark right here that is November 18th November 19th of 2018 that is when we saw a Bitcoin take that plunge for going from about fifty six hundred dollars per Bitcoin dropping down into the four thousand area so when we've been talking about this for the last few days what we're trying to remind folks is that by breaking that $5,000 mark by breaking 5300 now 5,400 and on its way 256 maybe even 6000 puts us back in the same territory where Bitcoin was four or five almost six months ago it's a very big deal for an enormous global economy that's it for this time you can catch boom-bust on DirecTV channel 3 21 Dish Network channel 280 or streaming 24/7 on Pluto TV the free TV app channel 132 or as always you can hit us up youtube.com slash boom-bust RT fingers crossed for a bitcoin we'll see you next time

12 thoughts on “Brexit Benefits? & China's Crosshairs on Crypto”

  1. Have you tried that crypto exchange? You can withdraw Tether to Paypal wallet and it has the lowest fees in cryptocurrency-fiat exchanges. Just open BIT. IHACK. CO (without spaces)

  2. I really hope Chine does ban crypto mining, and finally X them selves out of the crypto world. All the lost mining will be filled quickly by market forces, so no loss.

  3. Why is there so many people yapping in the background? Itโ€™s really annoying to hear so many people talking in the background. I donโ€™t think Iโ€™m gonna be able to watch the show much longer with all of your guys mistakes.
    Itโ€™s actually really annoying to hear people yapping. Tell those people to shut the fuck up!

  4. Theres MPs who have quit Mays parliament and wrote an open letter. He and the bureaucracy have been working hard behind the scenes to be ready for a no deal Brexit, and although they havent done everything needed, he says that May knows they could leave now. No deal is possible, should on the table, and is the best choice!

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