JP Morgan Chase Announces its own Cryptocurrency

J.P. Morgan Chase CEO Jamie Dimon called bitcoin a fraud in September 2017 and said, “You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart,” By January 2018 he had walked the remarks back but said he still was “not interested that much in the subject at all.” In February 2018, J.P. Morgan called cryptocurrencies “risk factors” to its business, something it never previously said.

And now J.P. Morgan (JPM, +0.19%) has become the first bank to offer its own cryptocurrency, CNBC reported. But don’t expect it to become an investment vehicle—at least for now. The cryptocurrency, called “JPM Coin,” is intended for the bank’s wholesale payments business that moves $6 trillion around the world daily.

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In the Robopocalypse, the Job Mortgages You!

Ever since the first vision of a robot appeared on the horizon of mankind, humans have feared that automation will replace the workforce in our dystopian future.

There typically follows a period of reassurance, in which we are compelled to believe that this will be a good thing, and that robots could actually liberate us from the drudgery of daily toil and free us for more enjoyable, cerebral pursuits. Futurist Jerry Kaplan, 63, is among those optimists. He estimates that 90% of Americans will lose their jobs to robots and we should all be happy about it.

“If we can program machines to read x-rays and write news stories, all the better. I say good riddance,” Kaplan said. “Get another job!”
AlphaGo beats Lee Sedol in third consecutive Go game
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Gulp.

Less discussed is the observation that inequality will be “a dark cloud” over this period of robotic rule. The robots, Kaplan admitted, will be owned by the rich. “The benefits of automation naturally accrue to those who can invest in the new systems, and that’s the people with the money. And why not? Of course they’re reaping the rewards,” he said.

“We don’t have to steal from the rich to give to the poor. We need to find ways to give incentives to entrepreneurs.”

One possible solution to 90% unemployment would be job mortgages, so that people who are displaced by robots can take out loans toward future earnings in unknown jobs. “People should be able to learn new skills by borrowing against future earnings capacity,” he said.

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Robopocalypse #20: The Sharing Economy is Doomed by the Bots, Just Watch Uber

Welcome to the Robopocalypse Report!  This is my news update on the onrushing robotic revolution in our economy.   I'll sometimes make editorial comments about the links, but for now this is larger a list of the news rather than a lot of commentary.

In the age of the drones,  the laws have not caught up.
 The FAA is the gating factor for drone based deliveries.

Drones are continuing to be a problem for commercial and medical flights.

On the other hand, Alaska has embarked on a major push to make drones an important part of its economy and Hawaii is wondering if it ought to as well.

On the self driving cars side, CNET dedicates an issue to "Riding in cars with bots."

The Washington Post gushes over Google's self driving cars.

The insurance industry thinks the manufacturers of self driving cars ought to bear the costs of liability.

Related to the self driving cars, Google will start delivering groceries in San Francisco this next year.

Why is Uber betting big on self driving cars?  hmm.  Maybe it has to do with the fact Uber wants to get rid of those drivers who are sharing their cars?  heh.  Pretty funny that they are financing directly their own replacement.  Doubly so since Uber's drivers are not classified as employees in California. 

The Woz thinks self driving cars could be the next big thing for Apple.

In 3d printing, a whole new technique, Laser-based Direct Metal Deposition, has been unveiled.  

A new 3d fabrication technique has been inspired by Japanese origami.

XYZ Printing has a new 3d scanner.

An American construction company owner has 3d printed a suite in a hotel he owns in the Philippines.

Navies may start 3d printing ships.

3d Systems' Fabricate is designed specifically for textile manufacturing.

The market for 3d printed medical devices is expected to be $2.13 billion by 2020.

The entire global market for 3d printing in 2014 was $3.8 billion.

On the robotics side, a Dutch company has created a vending machine that makes fresh french fries.

NEATO releases a new robotic vacuum cleaner that joins up via the buzzwordy the Internet of Things.  Just wait for the hacker to start chasing you around with the vacuum!  Kinda like this...

SAM, brick laying bot, is doing a job in DC for those of you interested in checking it out.

There's an interesting essay on building enthusiasm for bots in construction.

At Fort Bragg, they are testing out building an aerial gunnery range with bots.

Agriculture wishes they had bots for certain crops in a big way.

Just where how are the bots going to be used on the farm?

Where are the bots working in the diary and fishing industries?

How much fast will the agri bot industry grow through 2019?

In Australia three $150k bots replaced 60 welders.

In general software bots, not even IT workers are going to be safe.

Is the robopocalypse coming for the accountants?

On the artificial intelligence side, Scientific American asks the question of whether or not AI will ever be smarter than people.

They also ponder what will happen when AI gets involved with healthcare. 

On the economics of the robopocalypse, the financial sector seems to be unhappy with the idea of the robopocalypse.  Or at least some folks in thre are.

What does the robopocalypse have in common with the industrial revolution?

Why haven't the bots already taken our jobs?

On the legal side, a would-be Japanese John Connor was arrested.

Is it legal to go John Connor on that drone bugging you? 

Ukraine War Update: лягушачий дает стрижка

The Bild (in german, sorry) demonstrates the DNR is shelling itself with 120mm mortars on the schools of Gorlovka. 

Ukraine got a nice debt restructuring.  Noel Maurer digs into the deal and finds it was a good one in his posted entitled "The Barber of Kiev."  We've heard this from ancedotal sources for some time.  Its really nice to see this backed up with someone do the analysis.

Artillery duels have increased up and down the line ahead of the supposed truce.  However, about midnight everything got quiet.  That sort of thing makes most in the Donbas rather nervous.

Russia has closed it border to men under 50 from Ukraine.  This is to prevent draft dodgers in the DNR & LNR.

Big Finance Coming to Big Agriculture

IN THE next 40 years, humans will need to produce more food than they did in the previous 10,000 put together. But with sprawling cities gobbling up arable land, agricultural productivity gains decreasing, and demand for biofuels increasing, supply is not keeping up with demand. Clever farmers, scientists and entrepreneurs are bursting with ideas. But they need money to make this jump.

Financiers more often found buying and selling companies have cottoned on to the opportunity. Farm gates have traditionally been closed to capital markets: nine in ten farms are held by families. But demography is forcing a shift: the average age of farmers in Europe, America and New Zealand is now in the late fifties. They often have no successor, because offspring do not want to farm or cannot afford to buy out family members. In addition, adopting new technologies and farming at ever-greater scale require the sort of capital few farmers have, even after years of bumper crop prices.

Institutional investors such as pension funds see farmland as fertile ground to plough, either doing their own deals or farming them out to specialist funds. Some act as landlords by buying land and leasing it out. Others buy plots of low-value land, such as pastures, and upgrade them to higher-yielding orchards. Investors who are keen on even bigger risks and rewards flock to places such as Brazil, Ukraine and Zambia, where farming techniques are often still underdeveloped and potential productivity gains immense.

Farmland has been a great investment over the past 20 years, certainly in America, where annual returns of 12% caused some to dub it “gold with a coupon”. In America and Britain, where tax incentives have distorted the market, it outperformed most major asset classes over the past decade, and with low volatility to boot (see chart). Those going against the grain warn of a land-price bubble. Believers argue that increasing demand and shrinking supply—as well as urbanisation, poor soil management and pressure on water systems that are threats to farmland—mean the investment case is on solid ground.

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Russia Pulls 5th Bond Auction in a Row

Russia canceled its fifth ruble-bond auction in a row after the government’s borrowing costs reached the highest in almost five years earlier this month.

The Finance Ministry pulled tomorrow’s sale, citing “unfavorable market conditions” in a statement on its website. The yield on the 10-year government ruble bond reached 9.9 percent on Aug. 8, the highest since October 2009. It added eight basis points to 9.36 percent as of 1:49 p.m. in Moscow, increasing for a second day after falling as low as 9.27 percent on Aug. 15.

Russia has skipped 13 auctions this year as President Vladimir Putin’s standoff with the U.S. and its allies over Ukraine and the threat of tougher sanctions triggered a sell-off in the nation’s assets. The ministry voided four other sales where bidders sought higher yields than it was ready to offer. Borrowing costs climbed this week after four-way talks to halt fighting in Ukraine reached an impasse in Berlin.

The yield on the government’s local-currency securities maturing in February 2027 is trading 140 basis points above the central bank’s key interest rate, which it raised by 50 basis points, or 0.5 percentage points, in a surprise move on July 25. The spread was 124 basis points the last time the ministry said it would proceed with a local bond auction on July 15.

Russia has raised 124 billion rubles ($3.4 billion) this year from selling the local bonds, known as OFZs, and has placed 100 billion rubles in untraded government savings bonds, known as GSO, with the Pension Fund.

The government, which initially planned to raise 808 billion rubles in 2014, won’t sell bonds when borrowing costs are too high, Finance Minister Anton Siluanov said April 1.

“Overall, the federal budget is in good shape this year and, if oil prices hold at $101 per barrel until the end of the year, there will be no pressure in the primary market,” Maxim Korovin and Anton Nikitin, analysts at Moscow-based VTB Capital, said in an e-mailed note before the announcement.

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Brazil, Russian, India, China & South Africa Call for Their own IMF

Leaders of the BRICS group of emerging powers huddled Tuesday in Brazil to launch a new development bank and a reserve fund seen as counterweights to Western-led financial institutions.

Brazilian President Dilma Rousseff welcomed the leaders of Russia, India, China and South Africa in Fortaleza on Tuesday before expanded talks with South American leaders the next day in Brasilia.

Rousseff told reporters before the summit that the bank would help the nations invest in infrastructure projects.

She said the $100 billion contingency fund would be a "safety net" to contain "volatility faced by various economies when the United States exits its expansionary monetary policy."

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European Central Bank About to Charge Banks to Deposit Money?

The European Central Bank could be going negative soon.

Among the more unusual steps the central bank is considering this week to boost the eurozone's recovery is cutting to below zero the interest rate it pays on money that banks deposit with it. That effectively means banks would have to pay to park money with the ECB — an unorthodox move that has had some success in neighboring Denmark but hasn't been attempted in the much larger eurozone.

The goal: Push banks to lend that money to companies and consumers to get the economy moving.

The ECB, the eurozone's chief monetary authority, has been resisting such a step, which it considered as long ago as summer 2012 but which President Mario Draghi dismissed then as "largely uncharted waters."

But things are now bad enough that many analysts think Draghi and the 23 other members of the ECB's governing council will try the step Thursday and cut the deposit rate from its current record low of zero, perhaps with a rate of minus 0.1 percent. The ECB is also expected to trim its main interest rate, at which it lends to banks, from 0.25 percent to as low as 0.1 percent.

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Should the United States Postal Service Add (back) Financial Services?

WITH a workforce of just over 491,000 in 2013, the United States Postal Service (USPS) is second only to Walmart among civilian employers in America. But it still employed more than 200,000 fewer people last year than it did just nine years earlier—when it handled nearly 500m more pieces of mail and had almost 2,000 more retail offices. The rise of e-mail has left America’s massive postal service with far less to do, and it has been scrambling to find ways to raise revenue.

Earlier this year its inspector-general released a white paper suggesting that post offices should begin offering financial services, such as cheque-cashing, small loans, bill payments, international money transfers and prepaid cards to which salaries or benefits could be transferred. The reasoning is simple: a lot of Americans have scant access to banks and a lot of post offices have too little to do.

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Saudi Arabia Loans/Grants Pakistan $1.5 billion

Saudi Arabia gave USD1.5 billion to Pakistan on undisclosed terms in early March, prompting speculation that the two countries are working rapidly to further cement their security ties.

IHS Jane's reported earlier in 2014 that Saudi Arabia had sought the deployment of Pakistani troops to the kingdom while Islamabad was seeking sales of its JF-17 Thunder fighter aircraft, Super Mushshak trainer aircraft and Al-Khalid main battle tank.

A senior Pakistan government official told IHS Jane's that "at least half the Saudi funds" came as a grant while the other half "could also become a grant in future".

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Morgan Stanley Holding Internal Bitcoin Event

Morgan Stanley will be holding a microfinance bitcoin event on Thursday at its New York headquarters, despite CEO James Gorman saying the virtual currency is "totally surreal". Three bitcoin supporters, Marco Santori, Juan Llanos and Rik Willard, will present at the panel organized through the MicroFinance Club of New York titled "Digital Currencies in Microfinance: Their impact on remittances and financial inclusion".

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China to let Market set Interest Rates Within 2 Years?

China is likely to ease controls on interest rates paid on bank savings within two years and will allow wider use of its tightly controlled currency for trade and investment, the central bank governor said Tuesday.

Zhou Xiaochuan's comments follow pledges by Chinese leaders to make the country's slowing economy more productive by giving market forces a "decisive role" in allocating credit and other resources.

Allowing banks to compete for deposits by paying higher rates on savings would put more money in the pockets of Chinese families, helping to achieve official goals of boosting consumer spending and reducing reliance on trade and investment.

"Liberalization of deposit rates, this should be the last step in interest rate marketization," said Zhou at a news conference. "I personally believe it is very possible to realize this within one to two years."

Beijing announced its first major reform of interest rates in July, scrapping controls on lending rates. That will allow borrowers with better credit records to negotiate lower rates with banks, reducing costs for healthy businesses and spurring economic growth.

The central banker did not directly answer a question about why Beijing has guided the exchange rate of its yuan lower against in the dollar in recent weeks. But he pointed to the trade balance, which swung to a deficit in February, and said short-term changes in financial markets are normal, while the central bank looks at the longer term.

"We respect market forces," Zhou said.

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Another Warning to Little Scotlanders: Britain Will NOT Allow Scotland to use the British Pound

Britain's main political parties will tell Scotland in coordinated statements in coming days it cannot keep the pound if it votes for independence, two people familiar with the matter said on Wednesday.

Scottish nationalists accused British politicians of bluffing and said they knew well any bid to withdraw the pound from Scotland would damage English business. They said it would mean Scotland would not shoulder any share of British debt.

The drive by the three main parties, the boldest attempt yet by the British political establishment to scuttle Scottish nationalists' independence bid, reflects a growing sense that the issue of what currency a breakaway Scotland would use could be decisive in swaying undecided voters.

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Bank of England Warning to Little Scotlanders

The governor of the Bank of England on Wednesday waded into the delicate question of whether Scotland would be able to use the pound should it become independent, saying a successful currency union would require giving up some sovereignty.

Independence advocates say they want to continue to use the pound as the country's currency if the Scottish people vote for separation this year.

Mark Carney warned that successful currency unions still require some level of common fiscal policy and bank supervision. The recent debt crisis in the countries sharing the euro shows the risks of what can happen if those measures aren't put into place, he said.

"In short, a durable, successful currency union requires some ceding of national sovereignty," Carney said at a meeting in Edinburgh of the Scottish Council for Development and Industry.

Carney stressed it was up to the parliaments of Britain and Scotland to decide whether Scotland continues to use the pound in the case of independence. The Bank of England would implement whatever policy they chose.

"Decisions that cede sovereignty and limit autonomy are rightly choices for elected governments and involve considerations beyond mere economics," he said.

Carney's remarks are important because independence leader Alex Salmond, Scotland's first minister, has repeatedly stressed that the pound would remain the country's currency — a selling point to his movement. While Scotland is part of the U.K., it has had its own Parliament since 1999 and makes its own laws in many areas — but it is considering a full break.

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China Bans Bitcoin, Value Drops...or is it as Causative as Stated?

China’s biggest Bitcoin exchange was forced to stop accepting deposits in the Chinese currency on Wednesday, sending the price of the virtual money tumbling in one of its biggest markets globally.

The exchange, BTC China, made the announcement in a post on its verified account on Weibo, China’s Twitter-like messaging service.

The development comes less than two weeks after China’s central bank and four other government agencies that regulate finance and technology issued a joint announcement banning Chinese financial institutions from dealing in the virtual currency.

“For reasons we all know, BTC China has had to cease renminbi-account charging functions,” the exchange said in its message, referring to accounts in the Chinese currency. It said that it would continue operating and that deposits denominated in Bitcoins as well as renminbi withdrawals would be unaffected.

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I've grown curious about cryptocurrencies over the past six months.  I've been following mtgox as a source of information for market price of the coins.  The price actually dropped there for bitcoins a couple weeks ago from over $1k to $800.  Today its running between $455 to $750.  While I am sure the drop is real, I'd also speculate there was a bubble present already which was deflating. 

China in Africa: The $1 Billion Loan to Niger

Niger has accepted a controversial $1 billion loan from the Export-Import Bank of China (China Exim Bank) to finance development projects, the West African nation's planning minister said Tuesday.

Repayment of the 25-year loan will start in eight years' time "thanks to resources from the sale of oil being produced" by China National Petroleum Corporation (CNPC) in the east of the country, Amadou Boubacar Cisse announced.

The agreement, the conditions of which Cisse said were "very favourable", was signed in China on September 30.

Details were not immediately available, but typically China Exim Bank loans require the borrower nation to allocate work and equipment contracts for the project to Chinese companies.

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