SVET Reports
Wednesday's Markets Update (September 13, 2023)
On Wednesday, Nasdaq up as investors assess mixed CPI report. Fed seen holding rates in September, pausing in November. Megacaps gain, Apple down after China bans new iPhone models. BTC continued its micro-rally enhanced by positive macro-data. Other news: CFTC’s director warned against “unregulated” DeFi.
Details
Inflation accelerated to 3.7% in August 2023, driven by higher energy prices. However, core inflation slowed to 4.3%.
Comment
The annual inflation rate accelerated. At the same time, core inflation, which excludes food and energy, slowed. This is a reverse trend from what we have witnessed during the first halve of 2023. The Fed faces a serious challenge in raising interest rates without putting government budgets under too much stress or hurting the labor market. They cannot do anything about the price of energy, which is completely driven by geopolitical factors.
The latest increase in inflation was largely due to higher energy prices. The price of gasoline rose 10.3% in August, while the price of natural gas rose 19.8%. These higher energy prices were driven mostly by OPEC+ cutting its production trying the prevent further price downturn.
Crypto
The CFTC’s enforcement director warned that unregulated DeFi exchanges pose a threat to the integrity of the financial system. He said the agency will take enforcement actions against those who violate the law.
Comment
Agencies are fighting each other in an attempt to control blockchain and crypto. This is a new and rapidly evolving technology, and there is no clear regulatory framework in place. As a result, different agencies are vying for control over this space.
The fight for control of blockchain and crypto is likely to continue for some time. The fight for control of blockchain and crypto is not about “defending” consumers. It is about power. The agencies involved in this fight are all vying for control over this new and potentially lucrative market. They want to be the ones who set the rules and regulations, and they want to be the ones who collect the fees.
The fight for control of blockchain and crypto is a reminder that power is always at play. When new technologies emerge, there is always a struggle for control over them. The outcome of this struggle will have a significant impact on the future of blockchain and crypto, and it will also have a significant impact on the power dynamics in the financial system.