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What Moved Global Markets
– US-China trade deal: China would have to buy a ‘crazy amount’ of farm goods to meet Trump’s demand in phase one deal, CNBC reports. As part of a much-anticipated phase one deal, U.S. President Donald Trump insisted that China buy more American crops, saying that Beijing will purchase $50 billion worth of agriculture goods “pretty soon.” Analysts reacted with scepticism, pointing out that there are limits to the number of farm goods that China can consume. Deborah Elms, executive director of the Asian Trade Centre, warned that the Chinese have been “very cautious” in saying that they would buy according to market conditions and World Trade Organization restrictions. “In other words, there’s a giant red flag that says: even if we promise this… be careful because if the market doesn’t support the purchases at that level, then we may not reach that target.”
– Chinese corporate debt issue: While corporate debt is a “fault line in the financial system and the broader economy,” Moody’s Chief Economist Mark Zandi flagged Chinese indebted companies as the “biggest threat.” A similar warning by Fitch Ratings last week said that private companies in China have defaulted on their debts at a record pace this year. In an October report, the ratings agency put it down to a tightening of credit as a result of the government’s deleveraging efforts.
– The pound fell more than 1% in early trade Tuesday after media reports said that the British government will block a delay to the post-Brexit transition period. Local media reported early Tuesday that Prime Minister Boris Johnson will add a revision to the Brexit bill (formally known as the Withdrawal Agreement Bill) that would explicitly rule out any extension to the transition period beyond December 2020. The U.K. is due to leave the EU by January 31, 2020.
– The European Commission called on eurozone governments on Tuesday to use fiscal policy and engage in structural reforms to help the European Central Bank’s efforts to boost inflation and job creation.
What moved Crypto Markets (i.e. digital assets)
– Bitcoin has dropped to a three-week low.
– Fidelity Digital Assets expands to Europe. The company has formed a new branch in the UK in its bid to expand its business to Europe, the firm announced on Tuesday. As part of the effort, the asset management giant based its new entity in the UK, incorporated on December 16, per a Financial News report. The new unit will provide custody and trade execution services to Europe-based funds and family offices. However, it does not currently hold any regulatory permissions.
– Coinfloor, the U.K.’s longest-running cryptocurrency exchange, plans to delist Ethereum next month, citing an unclear future of hard forks and the need for complicated technical support for the second biggest coin by market capitalization. The company will also delist bitcoin cash, the splinter currency founded two years ago in the aftermath of bitcoin’s heated scaling debate. Starting Jan. 3, Coinfloor will support only bitcoin, whose eleventh anniversary happens to fall on that day. The plan comes ahead of the launch of ethereum 2.0, tentatively planned for early 2020, which will begin the process of shifting the network away from the energy-consuming proof-of-work (PoW) consensus mechanism to proof-of-stake (PoS).
– Nassim Nicholas Taleb, author of the bestsellers “The Black Swan” and “Fooled By Randomness,” is optimistic about cryptocurrencies. “You cannot ignore the cryptocurrencies, particularly the bitcoin story and blockchain,” Taleb said at Times Networks’ India Economic Conclave on Tuesday. The Lebanese-American author believes that people of some countries, such as Lebanon, have “lost faith” in governments and banking systems. “I am realizing Lebanon is in a situation where there is an implied currency control but the government cannot control bitcoin which is a good thing because people have no trust and the ability of the central bank which really causes the Ponzi style collapse and the bitcoin does not have that,” said Taleb.
Fintech: Big trio! Alibaba Group and Ant Financial Services Group have entered a strategic partnership with Industrial and Commercial Bank of China, in which the companies will deepen their cooperation in fintech and financial services. The companies plan to use their expertise in payments, eCommerce and fintech to focus on electronic payment settlement, cross-border finance and scenario-based financial services.
Healthtech: China’s Ping An Good Doctor and Thailand’s largest private medical group, Bangkok Dusit Medical Services (BDMS), announced the launch of a video consultation service. The service will allow the users of Ping An Good Doctor to seek second medical opinions via video consultations with top physicians in Thailand.
Al: Bosch develops an A.I. system in cars to detect distracted, tired drivers. The system makes use of cameras integrated into steering wheels and below or above rearview mirrors. It is one of several firms developing technology that aims to boost the safety of vehicles.
Smart cities: The New York City Council passed a bill requiring new or altered buildings to use bird-friendly glass to cut down on bird deaths from window strikes. The legislation requires 90% of exteriors on the first 75 feet of buildings to be constructed with bird-friendly materials. Bird-friendly glass has features such as glazing or patterns so animals can clearly identify a solid object’s presence, as opposed to the effects of reflective glass.
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