Wednesday's Markets Update (July 10, 2024)

11 Jul 2024 by rate3

On Wednesday, stock markets soared to new records, with the S&P topping 5600 for the first time, fueled by big tech and traders' positive perceptions of Powell's congressional testimony. Internationally, Brazil's inflation rose for the second month. BTC and ETH stayed at 60K and 3K respectively, still suppressed by negative sentiments despite being technically oversold.

Details

Average interest rates for 30-year fixed mortgages dipped slightly to 7% for FHA loans in the week ending July 5th. Jumbo loan rates edged up a bit. 1Y trend: "Up" (source)

Crypto

Goldman Sachs is launching three projects by year-end to turn real-world investments into digital tokens. This caters to client demand and could revolutionize investing. The projects target US funds and European debt, aiming for faster transactions and broader investment options. This reflects growing institutional interest in tokenization, similar to BlackRock's successful +500M BUIDL fund. (source)

World Markets

Brazil's inflation rose to 4.23% in June, exceeding a slight dip in May but staying below forecasts. This two-month rise follows a period of decline. While below the central bank's limit, some policymakers worry rising costs and spending could push inflation higher. Food, transportation, and healthcare saw the biggest increases. 1Y trend: "Down" (Ibge)
Russia's inflation hit an 16-month high of 8.6% in June, exceeding expectations. This rise is likely due to a combination of supply chain issues and increased consumer spending. Food prices saw the biggest jump at 9.8%. 1Y trend: "Up" (Ros)
Ukraine's inflation hit a record high in June (4.8%) due to ongoing Russian attacks. This caused significant price increases, especially for housing, utilities, transportation, and healthcare. There was some relief for food prices, however. 1Y trend: "Down"

Currencies

The British pound jumped to its highest level in four months due to inflation worries. The Bank of England suddenly signaled a delay in rate cuts, even though they've been considering them. It might be explained by the Labors' unexpected assent to power, which promises upcoming inflationary spendings. 1Y trend: "Up"

Comment: To Joe or Not To Joe

Watching two candidates, one as cool as a sea-bass, another as lively as the Tutankhamen mummy, throwing their dry excrements at each other in an empty room on live TV, must have been a turning point for 90 million horrified people.

However, the next day and week, it looked like no one could do much about it. Yes, many were talking loudly, as usual, but obviously, it was just talking to the wind. Nothing can be changed in that outdated system without fundamentally redesigning the whole layout.

The over-centralized governance mechanism, which forcefully puts the kingly bottom of Mr. President on top of all our heads, doesn't care a bit what we think in the most critical moments of our lives. All that matters is what an "elected" Majesty believes to be "true".

This type of arrangement might barely work under "usual" circumstances, but it becomes a disaster-in-waiting when His Majesty stops realizing that he not only looks like a vampire surprised in his lair by daylight but is also 100% wrong on all accounts, like a rotten squirrel lying on a highway.

Maybe that type of "governance model" was adequate in the nineteenth and early twentieth centuries, when there were no technologies to replace that rudiment of feudalism, but not in the twenty-first century, when literally any instantaneous voting and crowd-decision making application would do better than those two horror-movie apparitions pretending to be living creatures, which we saw on our devices two weeks ago.

So, do not ask what the Government might do for you - ask what you can do to change your Government.