Weekly SmartPills #57
Financial Markets
Cryptocurrency Market
In the ever-dynamic world of cryptocurrencies, Bitcoin has recently made headlines again, surpassing the $100,000 mark to reach an all-time high of $108,000 in midDecember. However, it has since corrected to around $93,500, reflecting a recent dip. This decline is attributed to stronger-than-expected economic data, which has driven up Treasury yields and heightened investor concerns about potential delays in Federal Reserve interest rate cuts. Ethereum, meanwhile, is trading at approximately $3,265 as of January 10, 2025. Analysts indicate an imminent growth, with the token ready to surpass $4,000 by the end of January and a potential spring boom.
Traditional Financial Markets
Turning to traditional financial markets, U.S. indices have experienced a mixed week. The SPDR S&P 500 ETF Trust (SPY) is currently trading at $589.49, showing a slight increase of 0.13% from the previous close. Microsoft Corporation (MSFT) is trading at $424.56, up 0.51%, while Tesla Inc (TSLA) is at $394.94, a modest rise of 0.15%. In Europe, the FTSE MIB index in Italy has shown resilience, climbing 1.8% to 35,040 points, bolstered by gains in companies like ENI, Intesa Sanpaolo, and Ferrari.
Economics and Regulation
Inflation in Sweden eased in December, with CPIF at 1.5% and CPI at 0.8%, fueling expectations of a rate cut by the Riksbank at its 28 January meeting. Analysts believe the central bank may lower its policy rate further, following five cuts last year, as inflation is now below the 2% target. However, policymakers caution against rapid adjustments due to the lagging effects of monetary policy. Additional economic data on household consumption and industrial production is expected this Friday.
China faces economic challenges, including a weakened yuan, property crises, and reduced growth. The government plans targeted measures like subsidies for green vehicles, appliances, and factory upgrades, while increasing long-term treasury bonds to stimulate the economy. Efforts to improve the business environment include cracking down on local government overreach and stabilizing financial markets. However, public dissent and critical economic discourse are tightly controlled, with actual growth estimated below official figures. Meanwhile, wealthy individuals are increasingly leaving the country amid these uncertainties.
Blockchain and Innovation
This week, we shine a spotlight on a groundbreaking project, MANTRA, a blockchain platform focusing on real-world assets. MANTRA has partnered with Dubai developer DAMAC Group to tokenize $1 billion worth of assets in the Middle East. Asset tokenization converts ownership rights to digital tokens that can be traded online, enhancing liquidity and accessibility. The Middle Eastern assets will be available on the MANTRA chain early this year, marking a significant step in the integration of blockchain technology with real estate and investment sectors.
Trends and Statistics
Household material welfare in Europe:
Luxembourg leads Europe in material welfare: AIC per capita in 2023 was 136% of the EU average, while Bulgaria and Hungary ranked lowest at 70%.
Disparities across regions: Western and Nordic countries report higher AIC per capita, while Central, Eastern, and candidate countries lag behind.
Turkey's standout performance: At 84% of the EU average, Turkey surpassed nine EU countries in material welfare.
Notable shifts in AIC over time: Denmark, Czechia, and Finland saw significant declines, while Ireland, Bulgaria, Spain, and Turkey recorded notable increases since 2020.
AIC as a welfare measure: This indicator includes all goods and services consumed, adjusted for price differences using PPS, to assess household material well-being.