Why is Cyber Insurance a Necessity in Today's Web World?

Cyber Insurance – Rising Threat to Cyber Security

An awareness regarding cyber insurance should be brought about owing to the rising threat to cyber security. The increasing threat with attacks like WannaCry rising in numbers together with the higher dependency on the web has given rise to the need for another support in the insurance segment namely cyber insurance.

The purpose of obtaining your online business or data insured has been an unfamiliar concept to several people. With various insurance companies available offering package connected to cyber insurances the idea for the same has not yet started. We have overseas insurance companies who have been providing cyber insurance keeping their focus on advent of tech companies.

 However in India, the scenario tends to be different. The MD and CEO of Future Generali Insurance, KG Krishnamoorthy Rao has commented that `it is a comparatively new concept particularly in markets here. Abroad the same has been prevailing for three-four years. However as more and more transaction tends to occur online, especially financial, incidents of cyber fraud seem to be on the rise.

Cyber terrorism is also a new threat where people tend to extort others online with threats that their data will be destroyed if the ransom amount is not paid. He further added that even if an awareness of cyber insurance is not familiar, it needs to be known and then there will be a market for the same.

Transacting Online – Information not Misused/Leaked

Krisnamoorthy’s company is awaiting approval for the launch of their cyber insurance package for the people. The other markets too are in agreement that the awareness could be important to this problem. Shupoorna Chakarabarty from ACP-India First Life Insurance had informed that most companies had not taken up this policy so far and it is critical that when one is transacting online, their information is not misused or leaked.

 It is often the banking sector or payment wallets which tend to need cyber insurance urgently. Though the loss owing to a cyber-attack is unavoidable, it could certainly be reimbursed. The cyber insurance offers a number of safety nets on any online business. Rao informed about some of the damages which tend to be covered within cyber insurance.

He informed that economic loss suffered by a client due to cyber-attack could be eligible for insurance and the insurance company is accountable in making up for the loss incurred. Moreover the transmission of data due to an e-threat, where the data tends to get destroyed is also covered by the policy. Another significant aspect is when the data is lost, the expenses in restoring the data is covered by the insurance agent.

Expert Intervention Needed

Though there are not several challenges while handling cyber insurance, Rao has mentioned that expert intervention was needed in handling these cases. He further added that when a client tends to claim a loss or damage, a cyber-security expert is essential in verifying the same.

The damages may not be easy to determine and tends to take a longer time. The issue prevailing so far is that in India, several of the people are yet not aware that they can claim this. He says that in India, we have not yet evolved to a point that we can sue a company stating that my information has been leaked.

Tips for Protecting Your Farm from Unnecessary Risks

If you run a farm, then odds are good that you've experienced the unpredictable nature of the profession. Whether crops are ruined because of poor weather, or you've had difficulty with managing the health of your livestock, there are many things that can go wrong in the day-to-day operation of a farm. Despite its reputation for difficulty though, there are actually a few tips that can help you get a better handle on your farm and protect your business from undue or unnecessary hardships. With that in mind, here's a look at some of the best tips for protecting your farm.

Protect Yourself With Insurance 

Insurance can be a powerful tool for many different areas of life, but it's especially important for farmers. Insurance companies like Ark Agency regularly offer farmers the opportunity to get equine and livestock insurance in order to protect themselves from any issues following an accident involving their cattle or other livestock. Given how crucial these animals can be to the success of a farm, if something unexpected happens to them, it can leave you without any other potential recourse. With that in mind, there are a variety of different livestock insurance policies out there, which can be tailored to your specific needs and circumstances. If you have highly valuable livestock, and haven't gotten an insurance policy for them yet, then now might be the time to do so.

Use Environmentally Safe Chemicals 

While everyone continues to debate on the reality of climate change, the truth is that farmers should still be trying to use environmentally safe chemicals above all else because it also has a direct effect on themselves. Studies have linked specific chemicals to health issues in farmers who regularly handle them, and it's worth noting that similar effects can also take hold in animals. If you regularly use pesticides and other chemicals on your farm, but aren't sure of their effects, then you might want to start doing your research. If you can find an similar, but more environmentally friendly, chemical, then you might want to consider making the switch.

Although these tips can't fully protect you from unexpected accidents while on the farm, they can at least keep your prepared in the event of one. No one wants to see all of their hard work get wasted due to a simple mistake, or an unexpected event, so these tips should give you the best chance of avoiding them. As always, hard work and determination can help you overcome anything, but it doesn't hurt to have a little help as well.

Machine Learning Promises to Shake Up Large Swathes of Finance

Machine-Learning – Compliance/Risk Management/Prevention of Fraud

Machine-learning has been enhancing in fields right from trading to credit assessment to fraud prevention. It has begun shaking up finance wherein a subset of artificial intelligence –AI tends to excel in locating patterns as well as making forecasts, which it utilised in preserving the technology firms. Towards 2019, those seeking to aspire being a `chartered financial analyst’ or desire distinction in the industry would be requiring, AI proficiency in order to be successful in his exams.

 Machine-learning, regardless of the uncertainty of several inclusive of some `quant’ hedge funds which tend to specialise in algorithm based trading, is said to be poised in having great impact. New fintech firms together with some quick officials have begun applying the system to everything right from scam protection to discovering new trading policies, capable of up-end not only of the labour of the back office but also the more honest glamorous stuff.

 Machine learning has already been utilised for task like compliance, risk management as well as the prevention of fraud. A British firm known as `Voice’, tends to sell machine-learning driven speech transcription tool to huge banks in order to monitor the phone calls of traders for any indications of wrongdoing lime an insider trading.

Near Actual Tracking – Risk Disclosure

The other specialist such as Xcelerit or Kinetica seem to provide the banks as well as investment firms with near actual tracking of any risk disclosures enabling them to display their capital needs constantly. Machine-learning tends to surpass in noticing strange patterns of operation that may display fraud. Start-ups firm such as Feedzai – for payments, or Shift Technology – for insurance to behemoths like IBM have been providing these services and some have been developing the skills internally.

A British banking start-up – Monzo had built a model, swift enough for stopping the would-be fraudster from implementation of a transaction thus bringing down the fraud rate on its pre-paid cards in June 2016 from 0.85% to less than 0.1% by January 2017. The natural-language processing wherein AI-based system have been released on text, has begun to have a great effect in document-heavy portions of finance.

JPMorgan Chase, in June 2016, had organized software which can scrutinize through 12,000 commercial-loan contracts within seconds in comparison to the 360,000 hours the lawyers and loan officers tends to utilise in reviewing the contracts.

Automated Financial Decision

Besides this, machine-learning is also said to be good for automated financial decision irrespective of assessing credit worthiness or eligibility for an insurance policy. Zest Finance being in business of automated credit-scoring right from its foundation in 2009 had earlier in the year rolled out a machine-learning underwriting tool to support lenders in making credit decisions as well as for people with little conventional credit-scoring information.

It tends to scrutinize through huge amount of data like the payment history of people or how they seem to interact with the website of lenders. A tech savvy insurance start-up, Lemonade, has been utilising machine-learning to sell insurance policies as well as to manage claims. The latest boundary for machine-learning probably is in trading wherein it is utilised to bite on market data and also to select and trade portfolios of securities.

At Goldman Sachs, the quantitative-investment strategies division tend to utilise language processing motivated by machine-learning in order to go through thousands of analyst’s reports on the companies. Here it complies an aggregate `sentiment score’, depending on balance of positive to negative words. Goldman had also invested in Kensho which is a start-up utilising machine-learning in predicting how events such as natural disasters tend to affect market prices centred on data on similar events.

Restricted Useful Applications

A Toronto-based upstart, Castle Ridge Asset Management has attained annual average returns of 32% since its establishment in 2013. It tends to utilise a cultured machine-learning method such as those used in modelling evolutionary biology in making investment decisions. The chief executive, Adrian de Valois-Franklin, claims that it is very sensitive that it picked up 24 acquisitions before they had even been announced.

On the other hand, Man AHL, which is a well-established $18.8bn quant fund provider, had been conducting research in machine-learning for the purpose of trading since 2009 as well as utilising it as one of the techniques in managing client money since 2014. Martin Lueck of Aspect Capital seems to find the system exaggerated stating that his firm had observed only restricted useful applications for the same. However in other fields machine-learning has the possibilities of game-changing and there is no reason in expecting finance to be changed.

 As per a machine-learning fund manager, Jonathan Masci of Quantenstein, years of work on rules-based approaches in computer vision, telling a computer on how to recognize a nose for instant were instantly eclipsed in 2012 by machine-learning processes which enabled computers to `learn’ what a noses looked like from examining millions of nasal pin-ups.

Likewise a machine- learning procedure, according to Mr Masci has to beat conventional trading strategies depending on rules set by humans.

How will GST Impact the Indian Real Estate Sector

Impact of The Goods & Service Tax - GST 

The most ground-breaking tax connected reforms in some decades to be seen in India is the Goods and Service Tax – GST that will eradicate the incompatible as well as mounting taxation arrangements which have confused various industries over the last few decades.

 It would positively tend to have a deep effect on the economic prospects of India. An individual indirect tax covering the goods and services would tend to increased tax collection in the long run by making it simple for retailers together with many other businesses in complying as well as regulating the overall taxation stages. The favourable outcome of this new taxation administration would only become apparent within 2-3 years after its implementation.

 In spite of the announcement of the tax structure of the goods and services tax – GST, a lot of speculation would be there with regards to tax rate being applicable to the real estate as well as construction industry. It would be untimely to comment at this point of time since the tax rate has not yet been decided. Prospects for the real estate would be in the bracket of 12% but the GST rate does not seem to be the only significant element.

GST – Tax Neutral/Tad Adverse

It is a known fact that real estate sector tends to play a vital part in employment generation in India and ranks second after agriculture. The significance of real estate segment is comprehended with its average 5-6% GDP contribution as well as stimulating demand for over 250 subsidiary industries.

The real estate segment is said to have a considerable growth of about 22% in its private equity reserves from 2015 to 2016. During the third quarter of 2016, there was an increase of 9% in investments for residential properties from previous quarter.

The reduction rules for developers applicable under service tax system together with the input tax credit facility would be determined if the effective tax incidence on real estate would be lower or higher under GST. Meritoriously the composition system enables reduction against the cost of land up to 75% of the cost of the house for residential units at a price under I crores IND and less than 2000 sq.ft. tends to make the effective rate at 3,75%.The reduction in other cases seems to go below 70% thus making the effective rate at 4% which will go a long way in defining whether GST would be tax neutral or tax adverse in the case of real estate.

Uncertainties to Rental Housing Market

Some clarity on reduction for under construction houses as well as input tax credit benefit for developers has been offered by the government. Considering the residential property sector, the sales have not only been obstructed by tax rates but also by sentiment as well as on account of the trust deficit that the Real Estate Regulation & Development Act or RERA, it now seeks to report. Under GST, if cost tends to go higher, the lower prevailing current home loan rates to some extent could ease the impact.

Investors and buyers together with the developers are reasonably anxious that the final ticket size of the homes would escalate if the Government levies GST at 12% as against the prevailing service tax rates. Further clarity on this is anticipated by the developers though they are aware that it is in the interest of their business in keeping ticket sizes range-bound.

Developing market dynamics have already made a change in a way the developers tend to work. Other uncertainties relate to the rental housing market that would logically be the obstructed if the Government tend to tax residential leases under GST.

Rental Profit/Capital Value Appreciation

The common anxiety is that should this occur, the rental housing segment would see a big slump over the medium-term as residential leases are not taxed at all presently. It is appropriate to note that the residential leasing could be an essential demand that would not disappear just by increased taxes.

 Undoubtedly, we could be viewing at rental lack of progress or marginal decline while the market readapts to the new dynamics that GST would permeate. Rental housing demand however tends to be sticky and end-user-driven in nature. Hence we are certainly not watching for major slump in this sector due to GST even if it does not tend to tax residential leases.

Nonetheless it is true that most of the investors in the residential segment do not tend to invest for rental profit but for capital value appreciation and so reduced rental profits would not freely control sentiment. With regards to the impact of GST on the commercial office real estate market, with the prevailing service tax for commercial leases at 15%, GST overall would be probably neutral.

Presently reasonably priced housing has been exempted from service tax and it is possible that the government would come out with a clarification with regards to the applicability or tend to continue the exemption under the GST.

How Can I Enhance My Company's Conversion Rates?

One of the business owner's primary concerns is determining how to optimize the company's conversion rates. If you're currently thinking about strategies you can implement to enhance your organization's bottom line, it's important to remember that there are hundreds of options available to you. Here are three of them:

1. Utilize Consulting Services.

One of the best ways to improve your company's conversion rates is by utilizing business consulting services. These services will ensure that you have a team of business experts carefully analyzing every element of your company to ensure that it is functioning optimally. Any errors detected will be corrected so that your organization can maximize efficiency. Once this happens, you can expect to see a substantive increase in your conversion rates. Companies such as Predictive Service are pleased to offer clients dynamic reliability consulting services to keep their organizations going and growing.

2. Invest In Digital Marketing Services.

In addition to utilizing consulting services, make sure that you start investing in digital marketing services. This step is immensely important because we now live in a digital world. Given that people are now using mobile devices and PCs to shop and purchase items online, you want to be able to connect and convert people through the internet sphere. Some of the digital advertising services that may prove particularly beneficial for your organization include:

• web design and development

• social media optimization

• online reputation management

• search engine optimization

• blog work

Another digital advertising service that can be particularly beneficial for your organization is content marketing. This service is empowering because it ensures that all of your online content is innovative, information-rich, and engaging. Some forms of online content that you'll want to optimize include blog posts, web articles, and videos.

3. Implement Customer Relationship Management (CRM) Software.

One final conversion rate optimization technique that you may want to implement is the use of CRM software. This software helps your sales and marketing staff optimize interactions with customers, thereby increasing the likelihood that they will make purchases and be loyal to your brand. For example, CRM software enables your employees to keep detailed records of each conversation they have with clients as well as the purchases made by the customer. This information will help them market new products more effectively!

Don't Delay: Start Optimizing Conversion Today!

There are millions of things you can do to increase your company's bottom line. Three conversion optimization strategies you may want to consider implementing include utilizing consulting services, investing in digital marketing services, and implementing CRM software!

GST not to increase compliance burden, says Hasmukh Adhia

GST Not to Increase Compliance Load

Hasmukj Adhia, Revenue Secretary has informed that the GST would not increase compliance load on assessees, regarding the same are misdirected. He had stated while addressing netizens on Facebook that several people are of the opinion that the implementation of GST would end in increase in compliance cost which is totally misplaced.

 While explaining the basis he had said that people need tto keep various law books for the purpose of filing return for different taxes such as VAT, Excise etc in the prevailing taxation system. He went on to added that with the roll out of GST, there would be individual tax as well as accounting for which it would be quite easy.

It could be done via an offline excel form provided by the GST Network and if one intends to utilise this form for the purpose of maintaining record on the purchase and sales, he could utilise this for filing return and hence compliance would be reduced. Adhia leading the implementation of the Goods and Services Tax – GST had mentioned that the finance ministry has been gearing up for its roll out and a training comprising of five days has been already given to the officers.

GST to Be Implemented in July

He has also informed that an IT training is in the process for them. The intention of the government is to implement the GST from July 1 and the GST Council controlled by Finance Minister, Arun Jaitley had settled four rate classifications of 5%, 12%, 18% and 28% on merging levies such as central excise, service tax and VAT.

 Addition would be done by calculating the overall incidence of present taxation - central plus state levies and thereafter placing the good or service in the tax bracket nearest to it. Adhia also informed that the indirect tax load would come down in the new GST system. He said that there would be several goods and service that would be out of GST and would therefore offer advantage to common man with regards to taxes and the roll out GST would be tax neutral or there could be decrease of tax burden.

Regarding traders, he also informed that the tax filing would begin from the starting point level of Rs 20 lakh where the registration below the inception limit would not be essential.

No Harmonized System of Nomenclature 

He also informed that under PAN within one state only one registration would be permitted. For one business, no other registration would be permitted though there would be a need of single registration with regards to supply of production for more than one state.

For the purpose of coding, he mentioned that no Harmonized System of Nomenclature – HSN code would be needed in case of business turnover of Rs 1.5 crore. The Revenue Secretary also mentioned that on petroleum as well as alcohol products under GST, would not be under the new tax system till the time the GST Council tends to impose a rate. He added that in the near future, if the state agrees then petrol, alcohol together with natural gas would be coming under GST.

The Benefits of a 360 Degree Employee Survey

Let's face it, you don't always like getting feedback about your job performance. Even when you know it's coming, it can be hard to face the truth from your fellow employees. Add the process of taking a survey and it becomes even less appealing. You would think that great leaders are the best people at getting feedback, but this is definitely not the case.

Think about who gets told the most what they are doing wrong at your company. If it's anything like most other businesses, the higher you go up the totem pole, the less feedback you are going to get. Thanks to all of this, a 360 degree employee survey can be a huge benefit to your company. Here are just a few of the reasons why.

1.  Puts how over what - Just because an employee is getting all of their work on time doesn't necessarily make them a great employee. They need to be doing it in a way that benefits both them and the company without cutting corners or taking the easy way out. One thing this type of survey does is ensure that each employee is following protocol correctly in their daily tasks because an organized company is a healthy company. 



2.  Accountability - Everyone at a company should be held accountable for their job in the same way. Just because you have been promoted and advanced to a higher level in the company doesn't mean that you aren't held to the same high standard that you were when you were new.
    



3.   Performance Enhancing - One great thing that a survey does is remind people of what the job requires, especially helpful for long-time employees at the business that may have grown stagnant and bored with their job. The survey can act as a refresher course that inspires them and makes them perform better in the future.
   
    
4.  Improves Intra-office Relationships - Employees that are open and honest with each other build trust and the best way to do this is through an open dialogue.
    

These are just some the reasons that a 360 employee survey can be beneficial to both a company's leadership and lower-level personnel. Those looking into having a survey done at their place of business should contact a professional consulting group like Key Group Consulting. They have the knowledge and facilities to complete a survey for a company of any size.

How Fintech Is Increasing Financial Inclusion after Demonetisation

Prospect of Personal Finance – Cashless/Paperless/Presence-less

Prospect of personal finance and money is being fashioned into three consequences namely cashless, paperless and presence-less. Due to demonetisation together with succeeding steps involved ever since attempts have been done by the Indian government in making the economy more digitized and less cash-dependent and the banking system is made more accessible.

 Being digital seems to be the quickest means of speeding up financial presence, ensuring that more individuals are brought under the domain of formal banking scheme, Moreover they can also take advantage from the linked benefits of insurance as well as investment. India has been a home to almost 50 crore million people who do not seem to involve themselves in formal banking either through saving account or a cell phone based payment scheme.
Digital execution means having a bank account and hence the challenge here is how you could get more individuals in opening bank accounts to provide them with digital benefits together with subsidies. When the government had been directing the country towards a reduction in the use of hard cash, people would need to have an account with the bank, together with internet connection as well as cell phone to operate the digital transaction. It is here that the roles of Aadhaar as well as the cell phone tend to get crucial.

Pilot Project through RBI

From the population of about 125 crore, around 109 crore have enrolled for Aadhar with at least 100 crore having cell phone number which is quite a large number than those having bank accounts which according to estimates would be around 70 crore.

With the combination of Aadhar together with cell phone it is advantageous of bridging the gap by around 30 crore unbanked individuals.The government has aided a pilot project, through the RBI which would quicken the opening of fresh bank accounts with the support of cell phones and Aadhaar.

Limited- functionality bank accounts can be opened by the customers utilising this system without the need of the usual stress of visiting a branch and submission of documents in completing the KYC process. With the aid of the Aadhaar linked cell number, their KYC can be completed by authenticating themselves via an OTP and one can open an account digitally, instantly, cashless, paperless, without the need of being physically present.

Process – Convenient & Easy 

This tends to be convenient and easy for the individual to complete the process in the comfort of his home and it is also great for financial service providers since the cost of customer acquisition tends to get condensed by relying on digital platform which have the capabilities of processing millions of account opening application simultaneously.

This will progressively be the type of account opening developments in insurance as well as investment sectors. Insurance providers have already been depending on the OTP system in authenticating new accounts through Aadhaar.

This development would be enhancing with the increase in internet penetration together with the availability of cheap smart phones. India has about 35 crore people, presently who are linked to the internet which tends to double every two to three years on an average and it is expected that by 2020, there would be around 70 crore Indians utilising the internet.

That Chip on Your Credit Card May Not Be Stopping Fraud After All

It's a different world, where the science and technology have registered some of the most magnificent developments and innovations, which are potentially, help the society in having a massive growth in almost all sectors. The advent of the computer and the internet are one of the major inventions of the scientific development, which have changed the world to a great extent and today we can find some sort of touches in almost all products and issues in our existing society.

While the primary sectors are getting huge supports from the computer technology; the financial sector also has seen some of the major breakthroughs in the operation and management of the financial instruments and data. The Credit card is considered as one of the important issues in the financial market, which is now being used by millions of users, throughout the globe, for ease and comfort.

Today the credit card or debit card are using as the avenue of the cashless transaction, which safeguards the malpractices and helps in efficient accounting purpose. It can be noted that the safety of using the credit card is getting the highest priority and several measures are being taken to get the utmost safety of the cards, which are often found quite inadequate and vulnerable.

Credit Card and Relevant Issues

It is now known to everybody that the transaction through these cards are quite popular among the people, especially in the younger generation, and there are lots of chips and other devices are being used in order to check potential frauds. But at the same time; the fact is that there are some problems inherent in these chips, which are essentially meant for the safety of the credit cards. In the present scenario, the security chips are widely used in the financial world and it becomes a bit difficult for the criminals to counterfeit any debit or credit card.

But in recent days, the fraudulent activities are on a rise and various criminals are now pilfering cash from the plastic card by using some different mode of operation, which is considered as a great threat to the general people, who are using the credit card for convenience and safety. The new study, done by the renowned research organization, Javelin Strategy and Research, has made some unique revelations in the frauds of the credit card, which are as follows:

• The most common identity fraud has been rose about 16% in the year 2016, which cost individual an all-time high of USD 16 billion; 
• About 15.4 million people are affected by this kind of fraud, which is about 6.15% of the total consumers and a 2 million more from the earlier year i.e. 2015;
• While the study was not been done exclusively for the credit cards, but the researchers made it a point that the majority of these identity thefts are predominantly linked with to the credit cards; 
• This escalation in fraudulent activities, which is about USD 700 million more than the previous year, seems to be unspecified.

Use These 12 Steps For Success With Your Regulation A+ Capital Raise

In any business, the resource mobilization is a crucial and most important issue and people try their best to have some positive solution of this problem. The most natural form of resource mobilization is being done by the help of IPO, Venture capital or bank syndication, the Regulation A+ is helpful in getting the right kind of support in mobilizing the fund.

There are some steps to be followed for achieving Regulation A+, which are as follows:

1.  It is always a tough issue in front of any business or project; as the seasoned investors are usually quite skeptical about investing in new ventures. Therefore, using the Regulation A+ could be the best option to get the required fund; 
2.  The provision of dividend or royalty to the investor, broaden up the scope of getting fund from the targeted organization. Interest payments have been considered as a major issue in the Real Estate sector; 
3.  These days, the crowdfunding is considered as one of the most encouraging and effective forms of resource mobilization and to get it done, one has to appoint a 360-degree marketing agency for this specialized job; 
4.  It would be a great deal if a partnership can be cemented with a syndicate of broker-dealer, which could be helpful in getting an inroad into the world of potential investors at a single move; 
5.  The required "Testing of water" has to be done for a short period of time, otherwise; the very essence of testing the market can be jeopardized, which will eventually not been helpful in getting the financial support from the investors; 
6.  It is often found that some auditors delay the process by taking abnormal time to get things ready, therefore, the selection of the auditor has to be done with special care, which might be of great help for the funding; 
7.  This can be noted that the SEC use to allow the company to go for "no-minimum" offerings, which is a great advantage for the company to get at least some forms of capital investment, which might not be possible if there is any minimum level being set;
8.  It is always been suggested that the intended company should go for the offerings; once they have sufficient fund in hand to go forward, otherwise, the move can be disastrous and harmful; 
9.  One should not be confined their approach in the domestic market, on the contrary, an international exposure is always a very good option for mobilizing the fund and may at a lower financial cost; 
10.  The complex terms and conditions are usually being avoided by any potential investors, therefore a simplistic and transparent approach in this regard, is always helpful in getting the support from the investors; 
11.  The important part of the Reg A+ is the minimum level of opportunity that is being offered to the potential investors, which any investor from any part of the globe to invest, as per the capability, to the project or business; 
12.  Try the tier 2 of Reg A+, which provides the opportunity to raise from Zero to $50 million per year for the company.

Bitcoin exchange Coinbase gets money transmitter license in New York

With everything getting digitalized, the life of every individual is also becoming digital. Internet has given the power to everyone to avail anything they want that too by just sitting at your house. So, digitalization has captured every sphere of the human life. Whether it is about paying bills or opting for shopping you can manage anything and everything from anywhere and in every situation, that’s the power of being digital. Cashless is also not a problem in this era of digitalization. I believe the world is getting powerful day by day with this new technique that allows you to overcome every obstacle.


The effect of digitalization can be mostly felt in the zone of finance. New firms have come up to become a part of the world market holding hands of digitalization. One of the major company that has joined in with the New York’s Financial system is Coinbase. Recently, The Department of Financial System, New York has declared that it has given license to Coinbase for genuinely transmitting currency and money. Coinbase is one of the renowned companies famous for its dealings in terms of currency operating in almost 32 countries. Maria T. Vullo, the Superintendent of Financial Services had made this announcement that Coinbase has maintained its record of efficiency in terms of technological developments and thus New York’s Financial Services Department have decided to incorporate the company in their money and currency transmitting process.


A review of Coinbase’s technology was conducted by Department of Financial Services which involved the companies laundering process regarding anti-money, capitalization, protection of consumers against any piracy and also policies in terms of cyber security. The company Coinbase is constantly under the supervision of Department Of Financial System for offering services such as buying, selling, sending, storing bitcoin and receiving.


The company’s Chief Executive Officer Brian Armstrong declared that their first and foremost priority is to provide the safest and easiest way of currency exchange that too in a digitalized manner. So, that the customers can rely on them and do not have to experience any discrepancies from the company’s end. It is their way of maintaining a good relationship with its customers. Since, Coinbase in now a part of New York’s Financial System, hence, it has become a much known company in the field of currency transfer. The users can feel free to use them in times of their need and they assure you to provide satisfaction from all ends.


With the increasing need of transmitting currency, The Department OfFinancial System, New York has given license to several other money and currency transmitting firms like Ripple and Circle Internet Financial and trust charters to Gemini Trust Company, Winklevoss brothers are its founders and also itBit Trust Company. The Department before granting them license have fully enquired about these respective companies and after being satisfied have granted them license. These companies have come up to provide the best answer to digitalization and will add up in making life much easier for every human being.

Dollar retreats from 14-year highs, investors unpack Fed minutes

 
As the value of dollar fell against euro and yen the investors became cautious regarding increase in bets on greenback without any hints with respect to the economy of U.S. and the hike in rate of interest. The very first day of trading in 2017 for several investors was full of expectations as they met with U.S. manufacturing data which was way different from the previous days. Since, the depreciation of dollar was the highest till date.

The Federal Open Market Committee that met in December, had warned everyone of the risk of increase in inflation after President Donald Trump’s proposal of fiscal influence standards that would shift dollar and will push up euro to $1.0499, which is its highest value declared. But as the investors changed their ways, euro started tracing profits to some extent.

Joe Manimbo, a senior market analyst at Western Union Business Solutions in Washington has intended that this decrease in the value of dollar in comparison to euro and yen have led to mixed reactions as in a way it sounds optimistic in terms of the economy, and on the other way it suggests a demoralized power of dollar.

Research have shown that the last time the value of euro increased by 0.6 percent at $1.0465. The current data shows that such a quick increase in the value of euro in December was unexpected and the surveys prove that due to this the growth in business have reached new heights in more than five years.

The dollar was last seen to be down by 0.2 percent against yen at 117.51 after an overnight hike of 118.17 yen. After Trump was elected as the President dollar has increased against many currencies with an expectation that administration under him will push up inflation, leading the Federal Reserve to follow up through a hike in rate of interest.

The Mexican peso was found to be striking the lowest level against the greenback, it fell more than 2 percent to 21.62 pesos per dollar with an intention that Trump’s policy might allow the protectionist U.S. trade policy to become a reality.

The Chinese yuan was increased to 6.8707, which was its highest value recorded against dollar since 6th December. As a result China went into both onshore and offshore markets to increase the depreciating yuan for the second time. China was also found to set the onshore middle point rate much lower than the market actually expected from it which lead many investors leaving the ground, who were intending more upcoming weaknesses in the currency, positioning in the negative direction, this was propagated by Greg Anderson, who is the global head of foreign exchange strategy at BMO capital Markets.

Thus, we can relate that how the marketing strategies as well as the position of investors are subjected to change with fluctuating value of currencies that on a longer run effects the entire economy of the country both positively and negatively.

Rs 500, Rs 1000 Notes Abolished

Demonetization of Rs 500 & Rs 1000 Rupee Notes

In an important effect to check black money, the Prime Minister has announced demonetization of Rs 500 and 1000 rupee notes with effect from midnight of November 9 which makes these notes invalid on black money, corruption and fake currency.The decision of PM Narendra Modi to eliminate Rs. 500 and Rs. 1000 rupee notes with a view to control the flow of black money has been mentioned by almost all in Bollywood.

The decision had been effective abolishing Rs 500 and Rs 1000 rupee value notes as legitimate tender. To get to know on the implications on this financial decision, an interaction had been conducted with leading film exhibitor Akshaye Rathi who mentioned that the impact could be of two levels namely micro and macro.

With regards to film that would be coming in the future, it was essential to comprehend the pattern of audience which could be beyond the metros.In areas like Bengaluru, Delhi, Kolkata, Mumbai and Pune, individuals seem to be comfortable in utilising plastic money as well as online transactions.

However there is a massive population which is beyond the metros who do not approve of utilising plastic money. Then there is a still bigger crowd which goes to the bank and withdraw money, making their payment through cash.

Impact on Industry – Positive

People in places such as Kanpur and Satara tend to go to the bank on the first day of the month for withdrawal of cash for their monthly expenditure where the payment is done by cash. Hence, individuals would find it difficult in being unable to use the denominations of 500 and 1000 rupees when they go for a movie or intend to dine out with their family or friends.

Carrying a few five or hundred rupee notes tends to be much easier than carrying a good amount of hundred rupee notes in your wallet which could cause a bit of inconvenience to the individuals. With regards to Bollywood, Akshaye envisions the decision affecting the industry crowd in a positive manner and is of the belief that it would go a long way in eliminating bribes as well as corruption. He stated that the impact on the industry would be a very positive one.

A producer shooting is troubled by several entities such as organisations, political outfits and associations who tend to come and upset the shoot, by asking for bribe. The producer then provides them with the option of card or cheque payments. With this decision, all these bribes and loopholes have been stopped since one cannot pay a bribe with hundred rupee notes.

New Notes of Rs 2000 & Rs 500

Modi has mentioned that people having Rs 500 and Rs 1000 could deposit them in their bank and post office account from November 10 to December 30. He also mentioned that the notes would not be legal tender from midnight of November 9 and that they would be just useless piece of paper.

But he also added that all notes in the lower demolition of Rs 100, Rs 50, Rs 20, Rs 10, Rs 5, Rs 2 and Re 1 together with the coins would continue being valid.

He informed that new notes of Rs 2000 together with Rs 500 would be introduced and that there would be no modification of any kind of currency exchange be it DD. Cheque, payment through credit/debit card etc.

Snapchat Is Pumping the Next Tech Bubble with More Hot Air

Tech Bubble Likely to Burst

For greater part of the year, apprehension has been mounting that the second tech bubble is likely to burst. Contrasting from the dotcom bust of 1999 as well as 2000, that had been generated due to the unexpected downfall of companies on the stock market, the second coming has been established on the eye of valuation which the latest generation of tech companies had organised in achieving through private fund-raisings.

Scores of business all over the world have attained the so-called `unicorn’ status, an estimate of over $1bn. Overall, it is reaching 200 universally which have succeeded this mythical tag. Some of them seemed to be `mega-unicorns’ companies that have exceeded the $10bn target though a handful of superstars have hit the extraordinary levels.

Uber the taxi app is presently worth over $60bn while Airbnb, the favourite of the sharing economy has raised funds valued at $30bn. Meaningless estimates of young companies some of which make no money and you have the makings of a bubble which will certainly have to burst at some point of time with catastrophic consequences for global markets. Indications have been there for some time. Confidence in private market has taken a blow with a drop in funding rounds for start-ups.

Fidelity – Instigated Panic

A high profile tech investor, Fidelity had instigated panic when it had dropped the evaluation on dozen investments. On the other hand, some start-ups comprising of Uber had been compelled to go overseas in raising funds at higher assessments where the assessments of several big tech companies already on the stock market had collapsed.

However, in spite of the anxieties, the bubble is likely to be pumped with more hot air due to another burst of vastly over-priced floats. One of the most high profile is Snapchat which is a company that several people of a particular age would possibly not have heard it but has instantly become the social network of choice among millennial who tend to utilise the same in sharing photos, video drawings and texts.

Launched only five years back by three ex-Stanford University students, the same has been amazing. Snapchat tends to generate sales of only £300m each year, in spite of being utilised by 150m users each day and is uneconomic due to its free services.

Bubble – Low Interest Rate Environment

But these matters seem to be of no concern to the experts of Silicon Valley and Wall Street who tend to value the app at $25bn. However, it could prove to be the next Apple or Facebook and many are of the opinion though the same has been said regarding Twitter, Groupon as well as LinkedIn which tend to be over-hyped.

Snapchat will probably be followed by other hot tech firms comprising of Pinterest, Dropbox and SpotifyIt may only need one failure to affect it badly and 2016 may be the year the dotcom bubble 2.0 would eventually goes pop. The founder of PayPal and a billionaire tech investor, Peter Thiel states that we are in a bubble owing to the low interest rate environment that had been talked over earlier.

 He comments that `I think we have a bubble in the US in government bonds, due to the quantitative easing and the adverse real interest rates and to some extent that increases asset values all over the board inclusive of start-ups’

Mark Carney ‘serene’ about pre-referendum economic warnings

Governor of Bank of England – Serene on Judgement of MPC/FPC

With the indications increasing, that economic activity had held up more than expected since the June referendum, the Governor of the Bank of England, Mark Carney has fortified his blatant warnings regarding the negative impact of Brexit on the economy before MPs. In recent weeks with the firming of business activity surveys together with resilient retail spending data, has led to assertions from supporters of Brexit that the warnings of recession of the Governor has now been shown as scaremongering together with the quick to reduce interest rates, by the Bank’s Monetary Policy Committee – MPC, after the vote.

 However, these charges were denied by Mr Carney at the time of replying to the questions before the Treasury Select Committee. He stated that considering all the events since the referendum he was absolutely serene regarding the judgements made by the MPC as well as the FPC – Financial Policy Committee. He further added that they certainly welcome the signs of stabilisation and that the Bank had anticipated a bounce back in the much observed Purchasing Managers’ Index – PMI surveys when the interest rates were reduced on 4 August.

Biggest Downgrade in Modern History – Growth Forecasts

That recover had provoked the economic forecasters of a host of City of London to revise their expectation of a recession in the second half of the year, though a sharp go-slow in the growth is yet extensively predicted. Mr Carney had mentioned before the EU referendum in May that a technical recession would be possible in case of a majority Brexit vote by the British public.Interest rates were reduced last month by the Bank to a new historic low of 0.25% and had pushed on another £70bn of Quantitative Easing as it revealed its biggest downgrade in its modern history in growth forecasts.

Mr Carney had repudiated the charges that levelled by the pro-Brexit Conservative MP Jacob Rees-Mogg stating that the Ban had issued dire warnings before the vote, replying that he had heighted risks aptly. Moreover, the Governor had also added that the financial impetus the Bank had instigated together with its rapid offer of liquidity to the banking system had been one of the main causes the financial conditions seemed to be alleviated.

Traders Clambering Back

Moreover the Governor had also added that the implementation of the Bank on monetary stimulus and its rapid offer of liquidity to the banking system had been the main cause of financial situations being steadied. He commented that they had made the crystallisation of those risks less probable. Mr Carney had also mentioned that the Bank had `helped ensure that what was surprise for financial markets passed smoothly and that allowed us not to have an overshoot’.

Sterling has faced a record fall against the dollar in the two day in the wake of June 23 vote, dipping to its lowermost rate against the US currency in the last 31 years.The Bank of England had stated in August, that it could cut the interest rates again later in the year if the economy declined on the predictable. Presently the traders are clambering back their bets on another cut in view of the more positive economic data.

Oil Prices Fall As Production Freeze Expectation Fades

Oil Prices Dropped – Oversupply/Decline Expectation of Production Freeze

Oil prices had dropped on Thursday while market concentrated on oversupply and declining expectation of a production freeze. Global crude oil benchmark Brent had been down by 10 cents at $48.95 per barrel by 1230 GMT after closing down at 1.8% on Wednesday and U.S. light crude oil fell by 15 cents at $46.62 a barrel, after slipping by 2.8% on Wednesday.

In the first three weeks of August the oil prices had increased over 20% on talk of a probable deal by oil exporters to freeze production levels in an attempt to support prices. On September 26-28, members of the Organization of the Petroleum Exporting Countries would be meeting on the side-lines of the International Energy Forum, with groups and consumers in Algeria.

There are rumours that the meeting would agree to some kind of output curbs when similar attempts for production freeze had failed in April. Expectations however of a deal have been restrained by the record of OPEC output where some analysts envisage the vision of voluntary restrictions. Senior oil analyst at Commerzbank in Frankfurt, Carsten Fritsch, states that speculators pressed the price up expecting an output freeze that is doubtful to take place and perceives downside risk if the expectations are being scaled back.

Effects Minimal on Physical Market

U.S. investment bank Jefferies approved informing clients recently that even if a freeze had been agreed, the effects would seem to be minimal on the physical market. It was mentioned in a report that they did not expect a production freeze, let alone a production cut from the OPEC meeting.

With the output reaching almost record levels from several of the top producers and the demand unsteady, there seems to be little vision to the end of the surplus which had pulled down the prices of crude from more than $100 per barrel in 2014 to their present sub-$50 stages.

High storage levels too seemed to be weighing on the market. Commercial crude oil stocks, in the United States had increased by 2.5 million barrels to 523.6 million barrels, higher by 16% than a year ago.

Stocks across the world, with regards to refined products also brimmed as the demand slowed while refinery output seemed to stay high. BNP Paribas has commented that `ample inventories were due to weaker demand in Asia though more generally were driven by excess supply generated by refiners maximising runs, notably to produce gasoline in the U.S.’.

China’s Indirect Demand of Oil Dropped

According to Reuters’ calculations utilising official data, the indirect demand of oil of China had dropped by 0.3% from a year earlier to 10.58 million barrels a day in July.

After Saudi Energy Minister Khalid Al-Falih had informed Reuters that oil had paired some gains, he was of the belief that any substantial oil market intervention would be essential as the demand for crude would be picking up well around the world. He informs that there has been no discussion of substance still on the production levels of OPEC.

His comments strengthened the belief of several market participants which the September meeting would not resort to any production curbs particularly with the recent data portraying the Saudis and fellow OPEC member Iran were driving as much as they could.

Weak oil prices pull Wall Street away from record levels

U.S. Stock Indexes Move Back – Drop in Oil Prices

Stock indexes of U.S. moved back from its record levels due to drop in oil prices which overstretched energy stocks. The prices of oil dropped by 1.6% in cutting trading after the reports of the U.S. government of a surprise crude stockpile build. The energy index of S&P 500 fell by 0.9% and Exxon Mobil – XOM.N 1.5% drop was the top strain on the S&P 500 and the Dow. Since late June, a rally has left the S&P to almost 7% in 2016 as prospects of constant low interest rates motivated investors in buying into U.S. equities. The standard index this month had hit four record intraday highs.

 Regional investment director for The Private Client Reserve of U.S. Bank, Tim Dreiling had stated that once they had seen the new inventories, it certainly moved energy far lower dragging almost everything down.He further added that to grind higher, earnings improvements needed to be seen and that would come from economic improvement. The industrial average of Dow Jones – DJI had declined by 0.2% to finish at 18,495.66 points while the S&P 500 .SPX lost 0.29% to 2,175.49 points. The NASDAQ Composite .IXIC had dropped by 0.4% to 5,204.59.

Trading Volume – Lack of Market-Moving Information

Out of the 10 major S&P 500 index, six were lesser. Due tolack of market-moving information in a traditionally low-volume season, trading volume had been low. Around 5.92 billion shares had changed hands on the U.S. exchanges when compared to the 6.45 billion regular averages for the last 20 meetings. The shares of Walt Disney – DIS.N had ascended by 1.23% after the company recently had informedthe results which beat estimates stating that it is purchasing a 33% stake in video-streaming firm BAMTech. The stock offered the biggest increase to the S&P 500 and the Dow.

SunPower shares had fallen by 30% after the company had fluctuated to a second quarter loss, lowering its full year revenue prediction, stating that it would restructure its business. Perrigo dropped 11% to $85.06 after the company had reported a lower than expected earnings and dropped its remunerations forecast. JD.com soared to 8.6% to $24.28 after the company had stated the revenue within its forecast. The stock had given the biggest increase to NASDAQ. Weakening matters outstripped progressing ones on the NYSE by 1,610 to 1,259 and on NASDAQ; the issues dropped by 1,798 and advanced by 924.

Low Volume Could Skew Market in Any Direction

The S&P 500 index portrayed 18 new 52-week highs together with two new lows though the NASDAQ verified 61 new highs and 28 new lows. Market strategist at Prudential Financial, Quincy Krosby had stated that low volume was fairly standard at that time of the year and August seems to be a very irregular month and if one has low volumes, it could skew the market in any direction and that is what we have today. The trading volumes had been near year low since Monday as the second-quarter earnings seasons tends to wind down. Dollar index had slipped for the second straight day as weak U.S. productivity data on Tuesday dimming a bit the prospects of economic growth which would probably discourage the Federal Reserve from increasing the interest rates.

5 Technologies That Can Change Stock Markets Forever

Improved Insight on Risk Undertaken

Disturbance in digital system has been making the financial markets more apparent, reachable and efficient. Besides this it also tends to help the regulators in getting an improved insight on the risks which the applicants may seem to undertake. The following technologies could transform the financial markets in the forthcoming days:

Artificial intelligence and natural language processing 

Several of the financial companies are adopting algorithms in doing the tasks which humans have been performing for years. Mechanism learning systems have been enhanced considerably and with expanding processor potentials at lower cost, these systems are made available for larger usage. The techniques for artificial intelligence enable the system to learn from user connections as well as patterns without the need of being openly programmed for the same.

Machine learning together with other artificial intelligence technologies, in the past few years, has provided us with self-driving cars, real-world speech recognition, chess champions as well as more related as well as realistic web-searches. With regards to financial markets, we have software analysing voice patterns of recorded calls at investment banks, brokerages and on the client side too which could instantly distinguish irregularities and frauds, It can also look at keywords, decode conversational encryption of information and achieve difficult searches on the recordings.

Robo Advisers 

From the present situation, there could be probabilities that we would be seeing the last few Wolves of Wall Street and Dalal Street and moving ahead we may have only robots of Wall Street and Dalal Street. Though the systems hasprogressed in grasping the monetary goals, risk profiles together with the other complex details of investment to come up with personalised investment portfolio, it could alter funds, book profits or square off position depending on self-learning processes. The platform could be either for web-based and/or smartphone based, thus enabling easy access or adapt.This is said to be self-operated without the need of the user talking to a live person. Compared to a human advisor who tends to charge a portfolio management fee, the services here are rendered at no recurring expense.

Quantum `sealed envelope’

Outrages centred on information theft have often been a nightmare for performers in financial markets. Till now, hackers have somehow achieved to stay ahead of security programs as well as passwords though it could change very soon. A team of researchers inGeneva, Singapore, Cambridge and Waterloo and Ontario had utilised the breakthroughspeculative work co-authored by Dr Adrian Kent from University of Cambridge’s Department of Applied Mathematics and Theoretical Physics in providing `unconditionally guaranteed’ security as well as purity of message transferred from any two points on earth. Earlier trials using these digital `sealed envelopes’ is said to be successful and if all goes well, the monetary markets would be entirelysecured against any threat of statistics invasion.

Bitcoin and Blockchain technologies 

The distributed ledger, Blockchain technology after the virtual currency Bitcoin, tends to record the financial transaction of any digital interaction in secured, transparent, traceable and in an efficient manner. So it is appropriate in providing a universal virtual currency as well as for digital accounting and auditing financial transaction of any kind. The possibility of Blockchain technology is understood from the fact that 30 of the largest banks in the world had recently formed a global consortium to research, design and build Blockchain solutions further. Besides this, the Reserve Bank of India – RBI that had issued a cautionary note in 2013, against Bitcoin had changed its stance. The Indian central bank is now of the belief that the Blockchain technology could be helpful in the prevention of counterfeiting currency as well as financial transactions.

Big data and analytics 

Financial markets tend to generate enormous amount of data each second. Storing and analysing these details on real time basis could be critical. With a combination of private as well as public cloud tends to resolve the issue of storage as well as real-time access to this multitude of data at reasonable charges. Big data analytics tend to make it likely to highlight correlations which seem incredible for humans to locate. For instance, envisage a situation where 90% of orders that are positioned on NSE and BSE through high-frequency algorithmic dealing platforms tend to abruptly get cancelled within a span of less than 30 seconds.

 A human may never have known such trends with so much accuracy; RBI had highlighted this trend last year and alerted the market regarding it. Such kind of analysis could never be done without leveraging technology for big data scrutiny. There could also be software which could analyse thousands of social media feeds regarding the sentiments and news of a company and could try to forecast future as well as probable sentiments regarding the company. These visions could change the way institutional as well as retail investor trade in the market. Though some of these technologies could be in its initial stage of development and may need substantial enhancement together with market interest, the base has been set for digital alteration.

The Brexit Effect -What’s next for Markets

Britain’s Vote – European Union Likely to Disturb British/European Economies

Mentioning that Brexit vote on June 23 which had taken the financial market unaware could be an understatement and the pound, British stocks as well as the Gilt yields had mounted sharply in the week which lead up to the vote but crashed once the results began coming in.

Generally speaking, strategists on Credit Suisse’s Global Markets and Investment Solutions and Products (IS&P) teams anticipate markets to stay volatile in the forthcoming days and for the investors to favour safe assets to the uncertain ones.

 Some of the views have been highlighted from across the bank on how Britain’s referendum vote leaving the European Union is likely to disturb the British as well as the European economies and a broad range of financial resources.

The Economic Impact

The Credit Suisse’s Global Markets and IS&P team are of the belief that the Brexit vote would be creating a considerable amount of uncertainty for British businesses which would eventually lead to a weakening in GDP. Both the teams also tend to believe that the Bank of England would step in with cuts in rate.

Moreover, the Global Markets team believes that the Bank of England to cut rates from 0.5% to 0.05% and had another round of measurable easing to the tune of £ 75 billion which would not be later than August 2016.

Credit Suisse’s Chief Investment Officer for International Wealth Management, Michael O’Sullivan, pointed out that the central banks all over the work seems to be on alert to step in, ensuring that their own banking systems tend to have sufficient liquidity. Besides weak corporate spending, Global Markets economists anticipate growing inflation as well as the decline of the British pound to squeeze household expenditure.

Accordingly, they predicted that GDP would fall 1% between the third quarter of 2016 and the first quarter of 2016 which would have lessened their growth predictions for 2016 from 1.8% to 1% and the 2017 growth predictions from 2.3% to 1%.

Significant Slowdown in Growth

The analysts of Credit Suisse’ IS&P also expect a significant slowdown in growth and the teams contemplate it possible that the deteriorating value of the pound would be causing a front-page inflation to spike. The Global Markets team also seem to anticipate an impediment to the recent pickup in corporate spending especially in Europe together with the tightening of financial conditions.

The economists of the team had dropped their European GDP growth expectations from 1.7% to 1.5% in 2016 and from 2% to 1% in 2017. Credit Suisse’s IS&P team are of the belief that the Eurozone would not be following the U.K. into depression unless the Brexit vote ends in severe financial infection to peripheral economies like Italy. However, the analysts on the team envisage this as a tail risk. The IS&P team are of the belief that the European

Central Bank would lengthen its quantitative easing program whereas the Global Markets team consider that there is a possibility with added easing through the prevailing TLTRO program offering low-interest funding to commercial banks.Credit Suisse’s Investment Committee has downgraded European stocks to neutral as well as British stocks to drift whereas the U.S. stocks to neutral. Moreover strategists of Credit Suisse’s Global Markets had shifted their year-end goals from 6,600 to 6,200 on the FTSE 100, 2,150 to 2,000 on the S&P 500 and on the Eurostoxx 50, from 3,350 to 2,950.

Bank of England Warns Property is a Key Risk to Economy

Bank of England Cautions – Commercial Property Main Key to Economy

The Bank of England has cautioned that commercial property would be the main key to the economy after the Brexit vote. The main concern is that the market from warehouses to office space to retail parks with regards to commercial property is deep distress. Foreign investors, who have purchased commercial property, have made around 45% of all commercial property bought and sold since 2009. The inflow of money to UK seemed to slow down, even before the Brexit vote and dropped by 50% during the first quarter of 2016.

A warning had been given by The Financial Policy Committee that `valuations in some sections of the market, particularly the prime London market had become stretched’. The Financial Stability Report of the Bank points that the real estate investment trust share prices had dropped severely and cautioned about the risk of `future marked adjustment in commercial real estate prices’. According to the translation from Bank of England, there is a risk that commercial property prices may crash.

Considerable amount of most of the valuable prime London commercial property is said to be in the City where some of the foreign investors like banks and investment manager have a

ssisted in financing a powerful and constant session of construction, which have been symbolised by iconic buildings with nicknames like the Gherkin, the Cheese-grater or the Walkie Talkie

Inflows of Foreign Investment in British Companies – Slowed Down

Since 1980, the UK had earned abroad, extremely less selling goods and services than it had spent on imports thus developing a current account deficit. Roughly there was more money going out than coming in. For years it was compensated by attracting money to the UK in two ways.

The first way was that foreign investors had been willing to buy shares in UK companies and lending money to their government. The second was, the foreign companies had been ready in investing directly for instance, constructing new buildings in the City of London or in investing in business such as Jaguar Land Rover in order to turn it into success.

The report of the FPC had stated that all inflows of foreign investment in British companies had slowed down in the approach to the referendum.

Investors’ Belief – Risk in Investing in UK Companies

Investors are now of the belief that they will be taking a risk in investing in UK companies, that are reproduced in share prices, the biggest two-day slip in the value of sterling in more than forty years.There have been some reassuring words in the report. The banks for instance have been stress examined against scenario where the commercial property drops by 30% and residential by 35% with severe recession.Banks tend to have high quality liquid assets of £600bn like shares in top companies, government cash and bonds.

They could endure losses which were double as those undergone in the 2008 crisis without falling short of money. With that security, the Bank of England ruled on that the banks did not need to build up £150bn as a `counter-cyclical capital buffer’. The counter-cyclical buffer is just cash that is kept aside in good times so that it can be made available when the down-swing occurs

Markets Struggle with Brexit Hangover, Pound Sinks

Asian Stocks Dropped/British Pound Plunged – Brexit

Asian stocks dropped and British pound plunged over 2% on Monday while markets wriggled to shake off the uncertainty which had ignited due to Britain’s choice of leaving the European Union. Emotion seemed weak even though the most horrible of the uproar envisaged on Friday when the global stock markets had suffered one of their largest declines in almost five years, had improved. Senior foreign bond strategist at Mizuho Securities, Hiroko Iwaki, had stated that “things are so uncertain that investors still do not have a clear idea how much risk assets they need to sell. But it is safe to assume investors are not yet done with all the selling they need to do. I would not be surprised to see another 10% fall in share prices”. From the several questions regarding the British exit, or Brexit, which have generated are `just how much UK and European economies will slow, how they would negotiate their new relationship and how European leaders would try to improve the collapsing EU’. The world’s most traded stock futures; US S& P dropped 0.4% to 2,011.50, soaring close to the three and a half month low of 1,999 of Friday.

Brexit – First Surprise in Re-Calibration

The widest index of Asia Pacific shares MSCI, beyond Japan, shrank losses to 0.6% since the companies especially with UK exposure were under pressure.Equity strategist at Bank of America Merrill Lynch in Hong Kong, Ajay Singh Kapur had written in a note that they think Brexit could be the first surprise in a re-calibration of the world away from globalisation towards more inward-looking policy making’.He further added that `Brexit has now possibly opened up more uncertainty about the European Union project and that the already crashed down Asian and emerging equity market could receive asset allocation flows from Europe. Nikkei of Japan extended gains to 1.9% which was a fractional rebound after the hefty 7.9% of Friday’s fall. Stocks of Japan had been supported by stronger warnings from the officials of Japan that they would interfere in currency markets in stabilising the yen. However, the dollar still fell 0.3% against the secured yen, trading around 101.81 yen.

Sell-Off in Euro – Exit Referenda Builds

Shares of China also increased with the CSI 300 index as well as the Shanghai Composite both increased around 0.8%. British pound dropped 2% to $1.34, yet some distance from the 31 year low of $1.3228moved during wild trade of Friday. Moreover, euro had also come under additional pressure, falling against the dollar by 0.8% as the investors fret that Brexit would strengthen the anti-establishment mood in Europe and also communicated about breakdown of the union. The chairman of New Sparta Asset Management in London, Jerome Booth, had commented that “there will be sell-off in the euro as talk of other exit referenda builds. This sell-off will be more profound and long lasting and will be not just against the dollar and yen but also against the pound. It would also raise fears of significant loss of values for holders of Eurozone government bonds”. Since December 2010 on Monday, Euro’s weakness aided in pushing the Chinese Yuan to its weakest level against the dollar and dropped to 6.6396 per dollar on opening at 6.6360 a dollar, in comparison with the five and a half year low midpoint level of 6.6375 agreed by the central bank, reaching an intraday low of 6.6469.

Yen soars and Nikkei tumbles as Bank of Japan rejects further stimulus

Yen Scaled High – Nikkei 224 Fell

The stockindex of Tokyo had plunged over 3% on Thursday as mounting yen beat exporters after the Bank of Japan decided against increasing its incentive. Nikkei 225 fell 3.05% to 15,434.14 in trading, late afternoon. The yen had earlier rushed to a 21-monthhigh against dollar in the wake of the BoJ’s intention of leaving its enormous 80 trillion yen asset-buying plan unaffected, since fears on the future of Britain in the EU pound financial markets. Investors incline to buy yen as a means of safe asses in case of turmoil, though the stronger currency seems to be bad for Japanese stocks since it tends to threaten the productivity of the exporting giants of the country.

The yen scaled high as 104.11 against the dollar, in afternoon deal, its strongest level since September 2014. The decision of Bank of Japan had come up on Wednesday, after the Federal Reserve had decided against increasing interest rates and Janet Yellen; its boss had announced a warning on the possible Brexit from the US. Markets in the world have been left in chaos over the past week tension regarding the global economic outlook and in recent days, a rising sense that the referendum of June 23 would be seeing Britons vote breaking away from the European Union.

Weaker Hiring/Uncertainty – Referendum of the EU

Senior economist at Mizuho Securities, Norio Miyagawa stated that `there is nothing in recent economic indicators which would now lead the BoJ to change its economic outlook. But the rising yen would place more downward pressure on consumer prices and so expects the BoJ to ease in July’.

The US Federal Reserve that had been cautiously considering to raise interest rates or not, had held back at its own meeting on Wednesday and had instead downgraded its economic predictions, quoting weaker hiring as well as uncertainty regarding the referendum of the EU. This week’ polls suggested a tight contest in the vote of next week, being a main factor regarding the rush for safe havens inclusive of the yen. FTSE 100 had opened at 0.7% lower on Thursday, a presentation which quickly removed the uneasy gains of Wednesday after four previous days of heavy fall which saw the index fall less than 6000 barrier.

Energy Stocks/Miners Safe from Latest Beating 

The energy stocks and miners only were safe from the latest beating on values. There were comparable falls in France as well as Germany. Moreover the pound was also under pressure against the dollar down 0.4% at 1.41.4 which is an 11% down a year ago. Head of trading at ETX Capital, Joe Rundle had mentioned that the `markets were on the defensive again as traders foreseen the risks of Britain leaving the EU. Since polls indicate more support for Vote leave, City watchers had begun to take the threat rather seriously and began to price in the option of a Brexit.

For the City, it could be big; most of the banks and airlines would have to consider seriously moving outside the UK if a Brexit tends to occur. He further added that a slump in sterling could be a massive boon for some FTSE 100 firms. Miners would be seeing development in their sterling-denominated balance sheet when they sell in dollars and retailers would also probably prefer to stay on in UK though they would want to spin off their European arms’.

US dollar wallows near 4-week lows as Janet Yellen sounds cautious note

Dollar Flanked, Close to Four-Weeks Lows

After the remark of Federal Reserve Chair Janet Yellen failed to toss a lifebuoy to the recently plunging greenback, the dollar flanked up though still reeled close to four weeks lows against a basket of currencies on Tuesday. The index of the dollar that tracks U.S. currency against a basket of six main rivals pushed up 0.1% to 94.017, though it stayed within sight of its overnight low of 93.745, the weakest level since May 11.

However Yellen had remained comparatively enthusiastic regarding the overall U.S. economic outlook, stating that the Fed would hike the interest rate, she provided no fresh clues about timing, calling the last month’s U.S. jobs data as `disappointing’. Sue Trinh, senior currency strategist at RBC Capital Markets in Hong Kong, had commented that `she was positive though compared to her speech of May 27, when she had said a move would have been suitable `in the coming months’, she had not been specific regarding the timing’. The dollar seemed to be under pressure since the Friday reports of the U.S. nonfarm payrolls had indicated the slowest job growth in more than five years in May, suppressing prospects for a near-term U.S. interest rate rise.

Recent Currency Market `Orderly’

The U.S. interest rate futures implicated traders had all but priced out any chance the Fed would raise rates at its policy meeting next week, even before Yellen had spoken. The dollar had upturned its previous losses against the yen and rose 0.2% to 107.81 yen pulling away from the previous session’s low of 106.35, its weakest in a month.

It stayed wary of levels above 109 yen, where it remained as recently on Friday. The Japanese Finance Minister, Taro Aso, earlier on Tuesday informed reporters that he would desist from commenting on the possible response of Japan on the currency market if the yen was to rise further. He also declined to comment on the remarks of U.S. Treasury Secretary Jack Lew over the weekend which described the recent currency market movement as `orderly’ as an indication of caution towards the currency intervention.

Recent Unstable Sterling Marked Hard Rebound

The euro had pushed up 0.1% to $1.1360, reversing toward the earlier sessions’ almost one-month high of $1.1393. The recent unstable sterling marked a hard rebound after dipping more than 1% to three week lows in the earlier session, resulting in several polls ahead of the June 23 poll preferred the chance of British voters choosing to leave the European Union.

However the two polls in Tuesday’s newspaper portrayed Britons narrowly preferred staying the EU, when compared to the surveys released earlier. The pound had added 0.7% to $1.4524 after moving a one-week high of $1.4664 and on Monday had followed a low of $1.4352, its deepest all-time low since May 16. The Australian dollar had risen 0.6% to $0.7413 to one-month high after Reserve Bank of Australia had held policy stable as anticipated. It stated that its decision had been steady with maintainable growth. According to a Reuter’s poll, the central bank is broadly likely to hold rates at record low of 1.75% after its cut in May, with 49 of 52 economist’s surveyed sightingthe RBA standing pat.