Professor of Economics at New York University's Stern School of Business and Roubini Macro Associates CEO Nouriel Roubini joins the Yahoo Finance Live panel to discuss the U.S. economic recovery.
Professor of Economics at New York University's Stern School of Business and Roubini Macro Associates CEO Nouriel Roubini joins the Yahoo Finance Live panel to discuss the U.S. economic recovery.
Molson Coors Chief Communications & Corporate Affairs Officer Adam Collins joins Yahoo Finance Live to break down how Molson Coors and breweries are facing ramifications weeks after the Texas storm.
(Bloomberg) -- A surge in bond yields is bleeding into Asian markets where at least two state-backed Indian companies and three Japanese firms pulled planned debt sales.Indian Railway Finance Corp. and National Cooperative Development Corp. withdrew rupee note offerings Thursday. NCDC said it had done so after the coupon rate at which bids were received was higher than it had anticipated. In Japan, Santen Pharmaceutical put off a yen bond sale that it had planned to price Friday, after two other issuers there also paused deals in recent days.A jump in the 10-year Treasury yield -- the global bond benchmark -- to a one-year high is sending shockwaves through markets. Global credit markets have stumbled in one of their worst weeks this year, with Asian junk bond prices extending their drop this week to the worst since October.Read more about Federal Reserve Chair Jerome Powell leaving bond markets disappointedFor now, many companies are still sitting on ample piles of cash to weather such volatility after record bond issuance in most markets last year and even through recent weeks in 2021. But any quickening in the pace of yield increases ahead would raise more concern.In India’s case, financing costs have also been pressured up after the government last month announced bigger-than-expected borrowings, fueling concern that companies will get crowded out of debt markets. Rupee corporate bond yields surged the most since 2013 in February and local note issuance plunged to a 19-month low of 504.6 billion rupees ($6.9 billion).Attention now turns to companies planning to seek bids for local-currency notes on Friday: National Highways Authority of India, LIC Housing Finance and Housing Development Finance Corp.(Retops to add broader context)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- SoftBank Group Corp.’s Chief Strategy Officer Katsunori Sago is planning to quit after less than three years at the company, as other executives gain prominence at the Japanese investment conglomerate.The Goldman Sachs veteran who joined SoftBank in June 2018 will resign on March 31, SoftBank said in a statement late on Friday. The Tokyo-based company was confirming an earlier report by Bloomberg News.The 53-year-old is a key member of founder Masayoshi Son’s inner circle and something of a celebrity in Japan’s world of finance. Prior to joining SoftBank, Sago spent more than two decades at Goldman Sachs Group Inc., rising to become vice chairman of its operations in the country. During a three-year stint at state-owned Japan Post Bank Co., he spearheaded a portfolio shift away from sovereign bonds.But little is known about his work at SoftBank. The company has never clearly defined his role as CSO, a position that did not exist prior to his joining. Over the past few years, he has assembled a small team of former Goldman bankers and set up an investment department in April.“Sago-san dedicated himself to a variety of projects by bringing a whole new perspective as SBG transforms into a strategic investment holding company,” Son said in the statement. “He played a crucial part in expanding SBG’s potential as an investment company.”Rumors about his departure began to circulate late last year as Sago seemed increasingly adrift while other Son lieutenants, including Chief Operating Officer Marcelo Claure and Vision Fund head Rajeev Misra, began to take more prominent roles in public markets and startup investment.In November, SoftBank said Sago and three other directors will leave the board in an effort to increase the proportion of outside directors and improve corporate governance. The executive earned 1.11 billion yen ($10.2 million) in the year ended March 2020, a 13% increase from the previous year.Sago’s the latest in a string of executive departures at the group. In January, Bloomberg News learned that Vision Fund managing partner Colin Fan, a former Deutsche Bank AG banker who’d focused on technology bets, was leaving along with Jeff Housenbold, the managing partner involved in its bets on startups including DoorDash Inc. and dog-walking startup Wag. Fan had overseen the fund’s investment in troubled lender Greensill Capital.Read More: SoftBank Executive Colin Fan Steps Back From Vision FundThe Vision Fund decided to cut headcount by as much as 15% last year in a round of job cuts after the business reported an $18 billion loss because of the Covid-19 pandemic. The cuts disproportionately focused on employees who supported portfolio companies, people familiar with the matter said at the time. Claure’s SoftBank Group International arm reduced its staff by 26 out of 230, a person familiar with the matter said.(Updates with background on previous executive departures in final two paragraphs)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- U.K. house prices fell for a second month in February during a national lockdown to control the coronavirus, the mortgage lender Halifax said.The 0.1% drop last month follows an 0.3% decline in January and brought the annual pace of house price inflation to 5.2%. The figures contrast with an index from Nationwide Building Society showing the value of homes increased unexpectedly last month.Buyers boosted prices last year after the Treasury granted a temporary break on taxes for purchases, a measure that earlier this week was extended until the end of June. That helped offset headwinds from the deepest economic slump in three centuries and a surge in unemployment.“Having enjoyed an extremely strong period of activity in the second half of last year, the housing market continued its softer start to 2021,” Russell Galley, managing director of Halifax, said in a statement. “The housing market has been at something of a crossroads at the start of this year.”“We would not expect the level of growth seen in house prices over the past yearto be sustained throughout 2021,” he said.The average home now costs 251,697 pounds ($292,275).For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- In just a matter of hours, Bank of Japan Governor Haruhiko Kuroda killed a trade that has been building for weeks in the nation’s sovereign bonds.Five consecutive weeks of foreign net selling of Japanese bond futures gave way on Friday, as the contracts surged by the most in a year after Kuroda said he doesn’t think it’s necessary to widen the trading band around the BOJ’s 10-year yield target.His comments have helped made Japan bonds an outlier in major markets, with yields along the curve dropping -- the 30-year bond saw yields crash by more than 12 basis points -- even as reflation trades drive continued selling in global debt.Traders have been speculating since January that the BOJ could allow the benchmark yield to fluctuate in a wider range than the current 20 basis points around zero, following local press reports. The thinking was a slight steepening of the yield curve could help improve the functioning of the bond market and take some pressure off beleaguered banks.Investors had built up short positions in Japanese debt, most notably trend-following quant funds, although they may have been already taking profits before Kuroda’s comments.The potential policy tweak -- along with a global selloff in bonds -- helped drive a steady rise in yields this year, with the benchmark climbing as much as 16 basis points to 0.18%. Before Friday’s sharp rally, 10-year bonds hadn’t seen a week of gains this year.The BOJ is concluding a review of its ultra-easy monetary policy, which it plans to release in March.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Junk bonds, the only fixed-income segment still offering positive returns this year, will continue their outperformance, according to investor bets the U.S. Federal Reserve will eventually put its foot down and calm bond markets. To be sure, corporate debt may face bigger challenges in the coming months. Last month's bond selloff was fuelled by real Treasury yields climbing to multi-month highs.
(Bloomberg) -- Concern is mounting in corporate credit markets globally as longer-term Treasury yields continue to rise, leading borrowers from New York to Tokyo to delay bond sales and strategists to warn of trouble ahead.Gauges of credit fear jumped in Europe for investment-grade and high yield debt on Friday. Two borrowers that had expected to sell bonds in the U.S. opted to push their offerings into next week, after a stronger-than-expected jobs report brought fresh inflation concerns and lifted the 10 year Treasury rate briefly above 1.6%. The extra yield that investors demanded to own U.S. corporate bonds increased 4 basis points on Friday to 96 basis points, the biggest jump since Nov. 12, Bloomberg Barclays index data show.In the U.S. junk market, Ronald Perelman’s Vericast Corp. withdrew a $1.775 billion bond offering after failing to reach an agreement with investors on terms. And in Asia, two state-owned firms in India withdrew planned rupee note sales on Thursday and at least three Japanese companies have put off yen debt offerings in recent days.Still, there are signs that the party isn’t over just yet for corporate bonds. In the U.S. credit derivatives market, the Markit CDX North American Investment Grade Index, which investors use to hedge against defaults on company notes, fell from a four-month high, signaling that firms trading that instrument are a bit less concerned about credit risk. Dealers expect as much as $50 billion of bond sales next week, after more than $65 billion of sales this week.But market sentiment may be shifting. On Thursday, companies selling bonds in the U.S. got orders for just 1.8 times the amount of debt for sale, far below the average of 3.2 times for this year or four times for all of last year, according to data compiled by Bloomberg.Strategists are starting to sound alarms. Bank of America Corp. cut U.S. investment-grade credit to underweight in a note dated Thursday, citing its expectations that yields will continue to rise, which will likely push credit spreads wider. The underweight is a temporary trade, strategists led by Hans Mikkelsen wrote.Citigroup Inc. warned high-grade investors to “brace for fund outflows” in a Thursday note. Spread tightening is no longer offsetting rising Treasury yields, strategists led by Daniel Sorid wrote, adding that a flight-toward shorter duration strategies may be coming.The speed at which rates have risen is a concern for Barclays Plc, which is watching for a “shift in sentiment” on credit, according to a Friday note. Spreads have been resilient so far, “but there is some risk for spreads in the near term from a more disorderly move higher in rates,” strategists Bradley Rogoff and Shobhit Gupta wrote.Sentiment soured Thursday after Federal Reserve Chairman Jerome Powell told a Wall Street Journal webinar that the recent run-up in yields was notable, but declined to be drawn on what tools might be used if disorderly conditions or any persistent tightening in financial conditions threatened the Fed’s goals. With energy prices rising and Covid-19 vaccines fueling bets that an economic rebound will spur inflation, financing costs have started to bounce back from recent lows.In Europe, issuance remains robust for now, and notwithstanding recent bouts of turmoil, selling bonds remains cheaper than it was at the beginning of the coronavirus crisis.Companies and governments have sold over 407 billion euros ($487 billion) of bonds so far this year, the region’s fastest pace of issuance ever, according to data compiled by Bloomberg.“Issuers want to take advantage of this supportive environment provided by the central banks, before the market starts to anticipate tapering,” said James Cunniffe, director for corporate syndicate at HSBC Holdings Plc. “As we enter the second quarter, we expect to see a more normalized level of supply reverting back to previous years’ volumes.”U.S.Mobile gaming company Playtika Holding Corp. sold its debut junk bond Friday.A group of unsecured lenders to Hertz Global Holdings Inc. are proposing an alternative reorganization of the rental car company that would take it public, a move that counters a plan to sell the company to two investment funds for as much as $4.2 billion.For deal updates, click here for the New Issue MonitorFor more, click here for the Credit Daybook AmericasEuropeBooming ethical debt sales have increased the market share of green, social and sustainability debt to 17% of this year’s syndicated debt volumes, from around 7% a year earlier.The much maligned London interbank offered rate is finally within sight of retirement after the U.K. Financial Conduct Authority confirmed that the final readings for most rates will take place on Dec. 31The Republic of Italy’s debut green bond was the most-subscribed deal in Europe’s primary market this week, according to data analyzed by BloombergAsiaChina’s Ji’an Chengtou Holding Group was the sole borrower selling a dollar bond on Friday.“Inflation is likely to rise sharply in developed and emerging markets in the coming months on unfavorable base effects and higher commodity prices,” said Michael Biggs, macro strategist and investment manager at GAM in London. “We do not think the rise in inflation will be sustained, but it could scare the market”Combined with relatively lower liquidity versus investment grade and potential outflows, Asia high yield is ripe for a correction, according to Ek Pon Tay, a senior portfolio manager for emerging market debt at BNP Paribas Asset ManagementIn mainland China, a recent jump in defaults has led investors to favor safer assets, which is being reflected in smaller risk premiums for local-currency top-rated corporate bonds(Updates figures throughout)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Payments will be harder to get this time, but it might help to file your tax return soon.
(Bloomberg) -- Elon Musk set records last year for one of the fastest streaks of wealth accumulation in history. The reversal is underway, and it’s steep.The Tesla Inc. chief executive officer lost $27 billion since Monday as shares of the automaker tumbled in the selloff of tech stocks. His $156.9 billion net worth still places him No. 2 on the Bloomberg Billionaires Index, but he’s now almost $20 billion behind Jeff Bezos, who he topped just last week as world’s richest person.Musk’s tumble only underscores the hard-to-fathom velocity of his ascent. Tesla shares soared 743% in 2020, boosting the value of his stake and unlocking billions of dollars in options through his historic “moonshot” compensation package.His gains accelerated into the new year. In January, he unseated Bezos as the world’s richest person. Musk’s fortune peaked later that month at $210 billion, according to the index, a ranking of the world’s 500 wealthiest people.Consistent quarterly profits, the election of President Joe Biden with his embrace of clean technologies and enthusiasm from retail investors fueled the company’s rise, but for some, its swelling valuation was emblematic of an unsustainable frothiness in tech. The Nasdaq 100 Index fell for the third straight week on Friday, its longest streak of declines since September.Bitcoin InvestmentMusk’s fortune hasn’t been solely subject to the forces buffeting the tech industry. His net worth has risen and slumped recently in tandem with the price of Bitcoin. Tesla disclosed last month it had added $1.5 billion of the cryptocurrency to its balance sheet. Musk’s fortune took a $15 billion hit two weeks later after he mused on twitter that the prices of Bitcoin and other cryptocurrencies “do seem high.”Extreme volatility has roiled many of the world’s biggest fortunes this year. Asia’s once-richest person, Chinese bottled-water tycoon Zhong Shanshan, relinquished the title to Indian billionaire Mukesh Ambani last month after losing more than $22 billion in a matter of days.Read more: Ambani Again Richest Asian as China’s Zhong Down $22 BillionQuicken Loans Inc. Chairman Dan Gilbert’s net worth surged by $25 billion on Monday after his mortgage lender Rocket Cos. was said to be the next target of Reddit day traders. His fortune has since fallen by almost $24 billion. Alphabet Inc. co-founders Sergey Brin and Larry Page are among the biggest gainers on the index this year. They’ve each added more than $13 billion to their fortunes since Jan. 1.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Within a few months, he made enough for a down payment on a second home, in sunny Tampa, Fla. “I looked her up, and it all sounded really good,” he tells Barron’s. “I started investing with ARK just three days later.” The “her” is Cathie Wood, who founded ARK Investment Management seven years ago, and joins our list of the 100 Most Influential Women in U.S. Finance this year. It isn’t just that ARK’s actively managed funds have done well, although they have—phenomenally so: Last year, five of its seven ETFs returned an average of 141%; three were the top performers among all U.S. funds.
Some households are collecting a big pile of federal money in 2021.
Congress is nearing passage of the third economic stimulus check it will send out to you and other taxpayers as part of its Covid-19 relief bill.
(Bloomberg) -- CLSA Ltd. has lost more than half of its fixed income team that focuses on bond sales in Hong Kong after its Beijing parent tightened control over the brokerage and cut down on risk, people familiar with the matter said.The departures include five of an eight-member sales team in Hong Kong, which facilitates trades for institutions, the people said, asking not to be identified because they aren’t allowed to discuss personnel changes. Director Tom Carlone, associate directors, Luke Yang and Gary Lam, as well as associates, Chris Wai and Cherry Chan, all left in the past two months, the people said.CLSA’s owner, Beijing-based Citic Securities, has reined in risk at the once freewheeling Hong Kong broker over the past year, cutting the available balance sheet for the fixed-income business and hampering its ability to trade, the people said. After buying CLSA in 2013, Citic Securities in early 2019 started to assert its control over the brokerage, also corralling pay and leading to the exit of most of its top executives.“We do not consider it appropriate to comment,” a CLSA spokeswoman said in an emailed statement on the most recent departures. “The fact that we are responding only by saying ‘no comment’ should not be taken as our form of acceptance of the accuracy of the contents of your proposed article.”The flurry of exits follow the departure of John Sun, who led the fixed income, currencies and commodities team till last year, before moving to APlus Partners, a Hong Kong-based firm focusing on private equity and credit investments. He was replaced by Shi Liang, a former vice president at Citic Securities who was transferred from Beijing.Leo Tong, Sun’s deputy who hired the five employees during his tenure at CLSA, also left in October to join SMBC Nikko Securities Inc.The shake-up at the Hong Kong-based brokerage started in early 2019 after Citic Securities chairman Zhang Youjun took over the same role at CLSA. It deepened last year as the parent overhauled the decision-making structure of the company, telling key managers to report directly to Beijing.The departures of the top echelons at the leadership committee has been followed by their counterparts at the debt business units. David Pong, head of debt capital markets for South and Southeast Asia, resigned earlier this year, as did the head of debt syndicate, Samuel Chan.(Updates with other departures in last two paragraphs.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The president has agreed to a compromise making millions ineligible for the third checks.
Virgin Galactic Holdings Inc. Chairman Chamath Palihapitiya sold off a chunk of his shares this week, and played a part of the plunge in prices.
Powell and his policymakers have until March 17 to regain control of monetary policy or they could face a creditability issue.
(Bloomberg) -- A lawmaker is calling for an investigation of a $54.2 million, after-hours purchase of Oshkosh Corp. stock the day before the company won a blockbuster contract to build trucks for the U.S. Postal Service.The transaction of 524,400 shares is bigger than Oshkosh trading volume for some entire days. The block itself amounted to almost 1% of the company’s publicly available shares and 74% of the firm’s 20-day average volume, according to data compiled by Bloomberg.Oshkosh shares surged as much as 16% the next day, Feb. 23, and have risen further since. The holdings would be worth $59.6 million at Friday’s closing price of $113.65, or more than $5 million above the purchase price. The parties involved in the trade couldn’t be determined.“It definitely stinks and needs to be looked into at the highest levels,” Representative Tim Ryan, an Ohio Democrat who is fighting the award to Oshkosh, said in an interview. “If that is not suspicious, I don’t know what is. Somebody clearly knew something.”Ryan said he will ask the Securities and Exchange Commission to investigate. Representatives of the agency didn’t immediately respond to an emailed request for comment after normal business hours.The Postal Service awarded the Wisconsin-based maker of military trucks a 10-year contract for as many as 165,000 vehicles worth as much as $6 billion.Ryan is backing the losing bid of Workhorse Group Inc. which has a 10% stake in Lordstown Motors Corp., which makes electric vehicles at a facility in Ryan’s congressional district.An Oshkosh representative didn’t respond to a voicemail and and email seeking comment.The move to award Oshkosh the contract stunned Wall Street analysts who had predicted Workhorse’s proposal to make electric trucks would win at least some of the order. Workhorse is considering challenging the award.Trades outside of normal market hours can have a significant impact on share prices because market activity is thinner.Ryan, who said he is drafting a letter to the SEC, has joined with Ohio Democrats Marcy Kaptur and Senator Sherrod Brown in calling for the Biden administration to halt and review the Postal Service award to Oshkosh.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Major oil sands producers in Western Canada will idle almost half a million barrels a day of production next month, helping tighten global supplies as oil prices surge.Canadian Natural Resources Ltd.’s plans to conduct 30 days of maintenance at its Horizon oil sands upgrader in April will curtail roughly 250,000 barrels a day of light synthetic crude output, company President Tim McKay said in an interview Thursday. Work on the Horizon upgrader coincides with maintenance at other cites.Suncor Energy Inc. plans a major overhaul of its U2 crude upgrader, cutting output by 130,000 barrels a day over the entire second quarter. Syncrude Canada Ltd. will curb 70,000 barrels a day during the quarter because of maintenance in a unit.The supply cuts out of Northern Alberta, following a surprise OPEC+ decision to not increase output next month, could add more support to the recent rally in crude prices. OPEC+ had been debating whether to restore as much as 1.5 million barrels a day of output in April but decided to wait.The Saudi-led alliance closely monitors other major oil producers as it seeks to manage the entire global market, and surging production in North America was its biggest headache in recent years -- especially from U.S. shale but also from Canada.“The U.S., Saudi Arabia, Russia, Canada, Brazil and other well endowed countries with hydrocarbon reserves -- we need to work with each other, collaboratively,” Saudi Energy Minister Prince Abdulaziz bin Salman said after the group’s meeting on Thursday.Read More: Saudis Bet ‘Drill, Baby, Drill’ Is Over in Push for Pricier OilCanada’s contribution to balancing the market with less production, much like slowing output in the U.S., is not a deliberate market-management strategy but significant nonetheless.Even though the output cuts are short-term, the battered oil-sands industry shouldn’t be a concern for the Saudis in the long run either, judging from McKay’s outlook for the industry.“I can’t see much growth in the oil sands happening because there is going to be less demand in the future,” he said. “The first step is we have to get our carbon footprint down.”After years of rising output turned Canada into the world’s fourth-largest crude producer, expansion projects have nearly halted on the heels of two market crashes since 2014.Adding to its struggles, Canada’s oil industry is being shunned by some investors such as Norway’s $1.3 trillion wealth fund amid concern that the higher carbon emissions associated with oil sands extraction will worsen climate change. These forces help make future growth in the oil sands unlikely, said McKay, whose company is among the largest producers in the country.Oil sands upgraders turn the heavy bitumen produced in oil sands mines into light synthetic crude that’s similar to benchmarks West Texas Intermediate and Brent. Syncrude Sweet Premium for April gained 60 cents on Thursday to $1.50 a barrel premium to WTI, the strongest price since May, NE2 Group data show.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Trouble may be brewing in China for Bitcoin’s raucous and divisive rally as the nation pushes ahead with a world-leading effort to create a digital version of its currency.That’s because the eventual rollout of the virtual yuan could roil cryptocurrency markets if Chinese officials tighten regulations at the same time, according to Phillip Gillespie, chief executive of crypto market maker and liquidity provider B2C2 Japan, which mainly works with institutional investors.“Once a digital yuan is introduced, that’s going to be one of the biggest risks in crypto,” Gillespie, who previously worked in currency markets for Goldman Sachs Group Inc., said in an interview. “Panic selling” is possible if the new rules end up sucking liquidity from trading platforms for digital coins, he said.Central banks’ power to issue virtual money and proscribe rivals is one of the key risks for the crypto sector. Chinese citizens are already banned from converting yuan to tokens but the practice continues under the table using Tether, a digital coin that claims a stable value pegged to the dollar. The money parked in Tether then gets routed to Bitcoin and other tokens.Tokyo-based Gillespie sees potential for an outright ban on Tether, which could raise the stakes for anyone minded to continue using it.A draft People’s Bank of China law setting the stage for a virtual yuan includes a provision prohibiting individuals and entities from making and selling tokens. In recent days, China’s Inner Mongolia banned the power-hungry practice of cryptocurrency mining.Representatives of the People’s Bank of China didn’t reply to a fax seeking comment on the prospect of regulatory changes. While there’s no launch date yet, the PBOC is likely to be the first major central bank to issue a virtual currency after years of work on the project.Tether officials have downplayed the concern, saying that central bank digital currencies won’t mean the end of stablecoins.“Tether’s success has provided a blueprint for how a CBDC could work,” said Paolo Ardoino, chief technology officer for Tether and Bitfinex, an affiliated exchange. “Furthermore, CBDC’s are unlikely to be available on public blockchains such as Ethereum or Bitcoin. This last mile may be left to privately-issued stablecoins.”Still, Gillespie points out that Tether is “this massive amount of fuel for Bitcoin purchases” and few people realize the potential for disruption. A “tremendous amount of liquidity” is coming from exchanges tapping Chinese demand, he added.Tether QuestionsBitcoin surged fivefold in the past year and hit a record above $58,000 last month before dropping back about $10,000. The rally has split opinion, with some arguing a new asset class is emerging and others seeing pure gambling by retail investors and speculative pros in the Wild West of finance.Tether is an equally controversial token deep in the plumbing of the nascent cryptocurrency market. Traders use it to park money as they shift from virtual to fiat cash.More than $18 billion of Tether moved overseas from East Asian addresses over a one-year period, including spikes suggesting Chinese origin, according to an August report from Chainalysis, which analyzes the blockchain network technology underlying tokens. The report indicated citizens may be using Tether to dodge rules that limit capital transfers abroad.Questions about Tether continue to swirl. The companies behind it were banned from doing business in New York last month as part of a settlement with state officials who found that they hid losses and lied about reserves.‘Liquidity Shock’A recent report from JPMorgan Chase & Co. said there’d likely be “a severe liquidity shock to the broader cryptocurrency market” if issues arose that affected the “willingness or ability of both domestic and foreign investors to use Tether.”“All the volume goes through Tether,” said Todd Morakis, co-founder of digital-finance product and service provider JST Capital. “As regulators become more and more restrictive on stablecoins, that could be very negative for the market because that could mean less liquidity.”B2C2 Japan’s Gillespie said Tether is “such a risky asset” and a “massive liquidity shock” is possible if China does ban it. “What would happen is there’s going to be massive panic selling,” he said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Despite the recent selloff in electric-vehicle stocks like Tesla and Nio, there is still intense investor interest in the sector, with demand for electric-vehicles expected to climb dramatically over the next decades.