Financial services media highlights Financial services media highlights

Bitcoin prices have reached record highs, but the cryptocurrency remains extremely volatile.

Bitcoin has made a surprising rally throughout the first few months of 2024 and hit an all-time high at the beginning of March.

This indicates that Bitcoin will likely continue to be volatile in the months to come despite its impressive growth streak. Some analysts predict that this rally will continue, but there’s no way to know exactly how the tides will turn. 

This growth is partially due to the rise in Bitcoin ETFs, which give investors a straightforward way to enter the crypto market. The most notable of these is Blackrock’s iShares Bitcoin Trust, which has reached more than $10 million in assets in less than two months. These ETFs are particularly appealing because investors don’t have to use a separate crypto exchange to buy Bitcoin. 

There is also a Bitcoin halving event scheduled for mid-April. This will reduce the supply of the cryptocurrency and could potentially drive prices up even further. However, this is the first time that Bitcoin has hit a record-high price this close to an upcoming rally. Other cryptocurrencies have also seen their prices increase as a side effect of Bitcoin growth, most notably Ethereum and Solana. 

Artificial intelligence technology has improved at a rapid pace over the last year and a half. This technology has already disrupted many industries and is likely to keep improving. The hype around AI has created buzz around many related tech stocks. One of the most notable of these is Nvidia, which makes high-performing computing hardware. Nvidia has pivoted to focus on developing AI computing technology, which has driven excitement among investors and sent the company’s stock prices soaring. 

Other AI-related stocks have also seen growth over the past few months despite a stagnating tech sector overall. Companies like Advanced Micro Devices and Super Micro Computers Inc. have also seen their stocks rise as a result of AI mania. 

However, not every company involved in AI tech has been so lucky. Adobe has implemented a wide variety of AI features in its products, which caused the stock to rally throughout the second half of 2023. However, the company’s stock has since dropped over concerns about competition from other generative AI programs. 

Ethical concerns around AI technology could also affect the industry’s growth in the future. A Microsoft AI engineer recently came forward to express concerns about the safety and quality of the company’s AI image generator. Google also had to temporarily pause its Gemini AI image generator as it created inaccurate and culturally insensitive photos. AI-generated deepfake content is also a major concern that most tech companies have yet to fully address. 

Federal Reserve Chair Jerome Powell spoke in front of Congress in early March about inflation, interest rates, and a range of other hot-button economic topics. Democrats are pushing the Fed to cut interest rates due to cost of living concerns. However, Powell said that the Fed would not make these cuts until inflation dropped down to approximately 2%. As of January, inflation rates have slowed significantly since their peak in 2022, but remain around 3%. 

Powell stated that he is not currently concerned about the possibility of a recession based on steady GDP growth and a solid job market. However, many consumers and businesses continue to struggle with the current financial market. Major tech companies like Alphabet, Amazon, and Duolingo have experienced layoffs, while private companies like Dynata have struggled with debt. Internationally, the UK and Japan have both recently entered recessions, which could potentially affect the US economy in the future. 

Additionally, Powell announced some significant changes to the Fed’s capital plan for large banks. Last year, the Fed proposed a plan that would significantly increase the amount of capital the country’s largest banks would need to hold. However, the banks affected have launched an ongoing lobbying campaign to change the proposal, and Republicans have expressed concerns as well. An amended proposal would be a major win for the big banks. 

Powell’s announcements quickly had an effect on the US economy as a whole. Treasury yields dropped while stock market performance was up. Experts predict the S&P 500 could hit record highs as a result of this announcement. In general, investors have been making bold investment choices in anticipation of economic data announcements, a trend that has some market experts concerned about volatility. 

Less than a year away from the next election, the UK’s Conservative government announced a new budget with significant changes to the country’s tax laws. Finance minister Jeremy Hunt made significant tax cuts in many areas with the hope of increasing support from voters. This included the second cut to social security contribution rates this year, as well as a variety of other cuts intended to ease cost of living concerns. Despite this new budget, the Conservative party continues to trail the opposing Labour party in the polls. 

One of the biggest changes to the tax code is a change to a non-domicile tax rule that has been on the books for over 200 years. This rule stated that UK residents with a primary residence outside of Britain did not need to pay taxes on foreign income or capital gains for 15 years after moving to the country. This policy has been heavily targeted by the Labour policy, making it a surprise that Conservative leadership opted to scrap it. In the future, non-domiciled residents will need to pay these taxes after just five years in the country. 

Boeing, one of the world’s largest aircraft manufacturers, has come under scrutiny after an incident earlier this year where a door plug flew off a new 737 MAX 9 plane in midair. The airliner continues to face challenges, causing problems for the airlines who work with them. 

The National Transportation Safety Board (NTSB) recently accused Boeing of failing to cooperate with the investigation into this incident. The NTSB says it hasn’t received key documents about the plane’s manufacturing process. They also haven’t yet been able to interview employees who were involved. 

The NTSB is also investigating a separate incident involving a rudder on a United 737 MAX 8 plane. On top of that, the FAA has flagged potential safety issues related to anti-ice systems on both the 737 MAX and the 787 Dreamliner. Boeing’s stock has struggled as a result of these ongoing challenges, and the company has also faced a significant loss of consumer trust. 

These investigations are also affecting the airlines that work closely with Boeing. For example, United has had to pull back on their pilot hiring plans as Boeing won’t be able to deliver their 737 MAX 10 planes on time.