How Stocks, Bitcoin and Other Investments Fare in a 0% Interest Rate World
On Long Reads Sunday, a reading of a John Street Capital piece on the realities of a market characterized by zero-bound interest rates.
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In order to diversify their portfolios, crypto traders turn to fixed-income instruments like bonds and stocks. A substantial economic force to be reckoned with, the cryptocurrency market is a legitimate source of debt securities that are no less reputable than their equivalents. With interest rate derivative products, the creditors in the cryptocurrency market, mostly comprised of lenders and borrowers, hope to stabilize their revenue and reduce their risk. There are two types of interest rate derivatives in the crypto market: one that lets you extend the length of your loan and one that....
The key difference between APY and APR is compound interest. Before investing, compare their potential returns. APR vs. APY: Which is better?The APY provides a clear idea of an account’s earning potential. The APR shows what will be owed. Both are calculated over a single year, which provides a more accurate picture than calculating the interest rate alone.Because the APR is calculated at an annual rate, it can be more advantageous for borrowers seeking the best rates, instead of investing in crypto assets and hoping for a return.However, because the APY is based on an annualized rate that....
Following the latest meeting of the monetary policy committee, the Central Bank of Nigeria says it has hiked the monetary policy rate to 15.5%. By increasing the key interest rate by 150 basis points, the central bank hopes to “narrow the negative real interest rate gap and rein in inflation.” The rate increase came just days after the naira’s parallel exchange rate against the dollar plunged to a new low. Narrowing the Negative Real Interest Rate Gap According to the Central Bank of Nigeria (CBN), members of the bank’s monetary policy committee (MPC) have....
A bill based on the proposed framework banning crypto investments could help to "restore the public's faith and trust in their public officials," according to Zoe Lofgren. Members of the United States House of Representatives and Senate as well as Supreme Court justices currently trading cryptocurrencies may have to stop HODLing while in office should a bill get enough votes.According to a framework released on Thursday, chair Zoe Lofgren of the Committee on House Administration — responsible for the day-to-day operations of the House — said she had a “meaningful and effective plan to....
Mt. Gox - the self-proclaimed world's largest bitcoin exchange - is losing its place. BTC China now has the highest monthly volume among exchanges, with about 1,031,000 BTC (at the time of this writing). The news comes as interest in Bitcoin in China has spiked over the last several months, prompting millions of buys from the Chinese, subsequently driving up prices around the world. How will Mt. Gox fare in the months ahead?