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License to Kill – Bond(s) explained

The below is the text from my latest blog post about bonds, if you want to see the original with pretty pictures, charts, graphs etc then click on this link.
Ok, the title is an obvious dad joke, but as it happens it still fits in with my naming convention for posts so happy days! On to more serious stuff.
The most common proposed asset allocation for people pursuing FIRE seems to involve having absolutely as much invested in equities (or to a lesser extent property) as possible, and reducing every other asset class to as little as possible. Which is certainly one way of doing things, and given the great performance of shares and property over the last 20 years or more there is an argument to be made for doing things this way.
It’s certainly not the only way of doing things though, and I will be trying to show why there is a case to be made for investing some money in other asset classes, in particular Fixed Income aka Bonds.
So what are bonds?
Bonds are a type of debt that is issued by governments, semi-government organisations, and corporations, so basically you’re lending them money. In Australia we also have what are called hybrid securities, but they’ve got some big enough differences that I’ll talk about them in a future post (probably).
Bonds are also one of those fun areas where there is an exception to every rule, so although what I’ve written below is broadly accurate there is always going to be some type of bond or a specific issue that breaks one of the rules.
So please don’t be an internet hero and “well ackshually” me about premium redemption/issue bonds, soft calls, hard calls, investor puts, floaters, PIK notes and all the rest of it because broadly speaking it isn’t going to make much difference for the purposes of explaining bonds. Basically play nice readers!
Talk numbers to me…
Bonds are all about math. As I’m sure regular readers of this blog can imagine this makes me very happy, and probably explains in part why I spent a large part of my career working in an area where understanding bonds was crucial, although to make things more interesting we added on a bunch of other stuff like equity options, credit derivatives, FX etc.
The main numbers to think about are the price you paid for the bond, the coupon on the bond, the yield on the bond, the time to maturity, and the maturity value of the bond. From those main numbers we also derive a bunch of other numbers I’ll talk about later.
Bonds are normally issued at a price of 100, with a fixed coupon (interest payment based on the maturity value of the bond) and a fixed maturity value at a known maturity date. So that’s 4 of the numbers covered already, happy days!
A lot of the time though you’re not going to be buying that bond when it is issued, you’ve buying it when it’s already trading in which case chances are pretty good you didn’t pay 100 for the bond. Buying it along the way doesn’t affect the coupon or the redemption amount at maturity or when it matures.
What it does affect though is the yield. There are a bunch of different yield measures but I’m going to go with yield to maturity, ie what yield (return) will you get if you hold the bond to maturity.
It’s not a perfect analogy, but one way to think about bonds is that they’re like a term deposit where the amount that you can buy it for moves around. If you buy a bond for $10,000 that is going to mature in a year and it has a 2% coupon and redeems for $10,200 (redemption price plus coupon payment), then your yield (2%) is the same as your coupon (2%).
But if interest rates have changed and so the price of the bond has changed and you buy that bond for $9,900 or $10,100, then your yield will be different from your coupon, either 3% or 1% respectively. Hopefully that makes sense? BTW I’ve rounded the numbers here to try and keep it nice and simple.
Most bonds pay interest on a semi annual basis (I used an annual payment in the example above to make things easier) so to figure out how much interest you get when it gets paid it’ll be the coupon divided by two.
Hopefully all of that makes sense, if not let me know in the comments.
Issuers of Bonds
As I said above the main issuers of bonds are governments, semi government organisations, and corporations.
Debt issued by governments is generally the safest type, because so long as they control the printing press then they can always print more money to pay you back. The Eurozone is a bit of an exception to this (understatement of the year) but in most of the other major sovereign bond markets like the US, Australian, the UK etc it’s true.
Emerging markets are a bit different because they often issue debt in USD, which means that if things go pear shaped then they can’t just print more money to pay off bondholders.
There can also be issues with getting your money back from sovereigns if they have too much debt, such as when they either don’t control the printing press (Greece) or the bond is issued in a different currency (Argentina) but for the most part if you lend money to a developed country in their own currency then you can pretty reliably count on getting your money back.
There are also bonds issued by semi government organisations like the World Bank, European Bank for Reconstruction and Development etc, these are slightly less safe for the most part but you’re still not taking on much risk of not getting your money back.
Debt issued by corporations is riskier, partly because businesses obviously can’t just print more money to pay you back, and because corporations can and do go bust. Sure it doesn’t seem likely that Telstra or Woolworths or the big banks are going to blow up any time soon, but there are plenty of other bond issuers out there with much more fragile finances.
As you would expect the more risk you are taking on the more return you want in order to be compensation for doing so. This is because unlike a term deposit the value of your capital isn’t protected. If you put $10,000 into a term deposit for a year with an interest rate of 2%, then you know that in a year’s time you will get back that $10,000 plus $200 in interest.
If for some reason the bank you invested that money through goes bust, the government will make you whole (up to the value of $250,000 per entity per approved deposit institution.
If you invest in a corporate bond and the company goes bust, well you’re probably not going to get all or maybe any of your money back. The good news is that you’re more likely to get money back than equity holders, but if the debts of the company are a lot more than the assets then you’re going to be in trouble.
There’s a clear framework for what happens if a company goes bust and who gets paid first and in how much etc, the short version of this is that equity holders are absolutely last in line but depending on what type of bonds you own you may not be a meaningful better position either.
And unlike a stock, when you own a bond you don’t own a piece of the issuer of the bond, you just own part of their devt. So if the company does great and starts making a fortune, you as a bondholder don’t get paid any more than what the terms of the bond state. Basically you can get a fair chunk of the downside and none of the upside beyond the terms of the bond. On the plus side this doesn’t happen particularly often, most of the time you’ll get what you were promised
Bond ratings
Now obviously some companies are more secure and stable than others. If you take a bond from the biggest company in the ASX200 which is CBA, then it’s more likely to fulfil the terms of the bond than whatever the 200th company is. That’s not to say the 200th company won’t, just that there is more risk. The actual degree of this risk is quantified in a couple of different ways.
First of all there are ratings agencies out there who will assign a rating from anywhere to super safe (AAA) to D (in default) with a bunch of graduations in between. Anything rated from AAA to BBB- is what is called Investment Grade (IG), everything below that is called High Yield (HY) or less politely Junk.
Just because a bond is IG doesn’t guarantee it will pay off, likewise something which is HY isn’t guaranteed or even likely to fail. For the most part though the different ratings given tend to play out that way in the real world, with far less defaults for bonds rated AAA vs bonds rated BB for example.
The big three ratings agencies are Standard & Poors (S&P), Moodys, and Fitch, and between them they’ll rate most of the bonds and/or issuers. They tend to be fairly backward looking in my opinion, and they were hugely and obviously wrong on rating mortgage backed securities back in the GFC. Still, they will generally give you a reasonable idea of the creditworthiness of the bond issuer.
Because bonds are also traded in the marketplace you can take the yield offered on a bond with a particular maturity, compare it to an equivalent government bond, and using some fun math (yeah baby!) back out a credit spread which that bond trades over treasuries (or swaps but I’m not going to get into that). The higher the spread, the higher the perceived risk of the bond, and vice versa of course.
Are bonds safe?
Well it kinda depends on what you mean by safe. If you mean are the bonds likely to deliver what the issuer of the bonds promised, then generally yes. As I said with government and semi government bonds you will almost certainly get all your coupons and the maturity value of the bonds delivered on time. Yeah, there are some exceptions to this but you’re unlikely to run into trouble with Australia, the US, the UK, the more economically sensible members of the Eurozone etc.
Similarly with corporates the vaast majority of the time you will get your money back on investment grade bonds, and it’s pretty rare to not get your money back on high yield bonds as well. That’s not to say it doesn’t happen, but it doesn’t happen much.
If you mean am I going to get back what I put into the bond, well no they’re not necessarily safe, particularly if you sell before maturity. Remember when I said bonds are kinda like term deposits that can trade? Well when they trade those prices move around, and they can move around a lot!
Why do bond prices move?
There are a bunch of reasons why bond prices move around, the main ones are changes in the interest rate environment, changes in economic conditions, and changes specific to the issuer of the bond.
We’ll talk about interest rates first. Bond prices have an inverse relationship with bond yields, which is a fancy way of saying if interest rates (yields) go down then bond prices go up.
How much do they go up? Well that depends on the magnitude of the change in rates, and a bunch of factors involving the bond. Basically the longer till maturity on the bond, and the lower the coupon on the bond, the more sensitive it will be to changes in interest rates. This is measured using modified duration and convexity.
Modified duration takes into account the timing of the cashflows of the bond (so coupons and maturity) and gives you a number which is typically a little less than that number of years to maturity, the higher the coupon the more it decreases the modified duration. If you multiply that modified duration by the change in interest rates in percentage terms, it will tell you how much the bond price will move by (in theory at least).
So if you have a modified duration of say 7.117, then for every 1 percent move in interest rates the bond price will change by 7.117 points. So if your bond price was previously 100 and rates moved down by 1%, then your bond should now be worth 107.117. Happy days! Conversely if rates moved up, well your bond is now worth 92.883. Not so happy days.
I’ve used the [ASX bond calculator](http://%20https//www.asx.com.au/asx/research/bondCalculator.do) to give a couple of examples using the current Aussie 10 year bond. You can hopefully see below that by changing the yield on the bond from 1.5% to 1% the market price has gone from 116.87 to 121.83, roughly a 4.25% change in price for a 0.5% change in rates, so presumably the modified duration on the bond is about 8.5.
To make things slightly more complex, that relationship isn’t fixed due to something called convexity. Instead of being a linear relationship, it’s actually a changing one (a curve rather than a line). Basically the more bonds prices move away from where they were issued the more that relationship will change.
Then there are things like GDP numbers, employment numbers, consumer sentiment surveys, PMI surverys, and all sorts of other economic news which will potentially move bond yields around, generally pretty slightly but it really depends on how important that economic number is and how much of a change from expectations it is.
On top of that for corporations changes in their own situations will have an effect on what their credit rating/spread is which will affect prices as well. If a company goes from being loss making to suddenly making a profit, then that’s going to be good for their credit and the bond price is likely to go up. Bad news like a profit warning will potentially mean a higher credit spread and lower price for the bond.
There is also general investor appetite for risk, so if investors are happy to take on more risk in their asset allocation (risk on) then they will likely sell off lower risk assets like bonds and buy higher risk assets like equities and to a lesser extent property. If things change and they want to go risk off, then the reverse happens and money tends to come out of equities and into bonds.
What happens to bonds if the stock market crashes or we have another GFC?
A stock market crash is actually one of the more compelling reasons to invest in bonds. This is because when stock markets crash investors tend to put their money into asset classes where they feel a lot safer ie, bonds. The rationale is that getting your money back is now hugely important, and even more important is not losing all your money as you will in those horrible equities which you knew you should never have invested in but that horrible financial adviser talked you into.
People. Are. Not. Rational. People panic. People sell assets which are going down in value even though they know they should be holding on for the long term. This applies not just to retail investors, but also to professionals who should know better.
In the GFC I spent plenty of time talking to institutional investors with a long term time horizon (ie 5 or 10 years etc) who suddenly decided they had to get out because of bad one month performance. People will bail out if the proverbial is hitting the fan. I wrote a bit about my experiences with the GFC here, and believe me there are a lot of people who are not going to be as cool calm and collected as they think they will be.
It’s very very very very (extra very for emphasis) important to note here that at this point in time investors will not be thinking that all bonds are much the same. When they are looking for somewhere to put their money that they now have after panic selling out of equities, they will park it in the safest place they can find, ie government bonds (aka treasuries). This will cause the price of those bonds to rise because of supply and demand.
If they still want to take on some amount of risk then they might put some into investment grade bonds, again this will push the price up a bit. They will almost certainly not put money into high yield bonds, because those are risky and in a crisis will behave pretty similarly to equities, ie they will fall in value. If anything they will more than likely try to pull money out of HY bonds, pushing the price down.
This excellent post really shows this in the below graph which shows the average performance of different types of bonds for a 10% or greater fall in the stock market (all of this is for the US but the same principle applies to Australia).
It doesn’t work in every case, as shown below (same source), but in almost all cases of a big crash in equities, treasury and to a lesser extent IG bonds gave you a big positive return to help out. HY, not so much and in some cases actually gave you a worse performance than equities themselves.
Please believe me when I say it is a huge help psychologically to have some of your investments going up when the others are going down, which to me at least is a great reason to have some money invested in bonds.
You’ve convinced me, how much should I have in bonds?
Ok so I’m probably being slightly optimistic here given the number of posts I see on reddit about how VDHG would be so much better if Vanguard got rid of that terrible 10% that’s invested in bonds and put it all in equities instead.
It would be nice to think though that some people are now realising that come the next crash they too might not behave entirely rationally, and it sure would be nice to own some assets that are going to zig when the stock market zags, so to speak.
On the off chance that I have actually convinced people, well it really comes down to your particular risk profile. This is going to be hard to believe for some people, but in the US the default portfolio for most investors is 60% stocks and 40% bonds.
Looking at Oz , the default balanced investment option for most super funds over here are supposed to have something like a 70:30 split between growth assets (shares and property) and defensive assets (bonds and cash) although the reality is a long long way from that if you actually look into how they invest (that’s a discussion for another time though). So that maybe provides a useful starting point.
I know that the average FIRE portfolio that gets talked about particularly from younger bloggers (who have likely never experienced a sustained down market) is pretty much 100% equities and property, maybe even leveraged up. Which is fine if you can hold on through the downturns, but not everyone can do this because it is extremely difficult to do psychologically. I wish them all the best of luck, but I am pretty sure that at least some of them will decide that it’s all too much and sell whenever we have the next crash.
There are exceptions to the rule though. One of my favourite bloggers, and someone who I know thinks deeply about this sort of stuff, is the FI Explorer who has about 15% in bonds and 15% in defensive alternatives (gold and bitcoin) as per his latest portfolio update.
Whilst I don’t like Bitcoin myself, or gold for that matter, he writes a good explanation about why he holds both here. I still don’t like either asset myself, but I recognise that I am not infallible, I could well be wrong about this, and certainly historically they have worked well as hedges.
In any case the more important point here is that there is basically a 30% allocation to what would be regarded as defensive type assets. This is actually a bit over his actual target of 25% in defensive assets, but he probably sleeps just fine at night.
I’m a little more aggressive in only having about 21% of my assets (excluding PPoR) in cash and bonds, but it’s not a huge difference. Both of us have been invested through stock market crashes and hopefully have come to realise that we are not the hyper rational investors that economists believe we are, and therefore it’s best to have a bit invested in stuff that will go up or at least hold it’s value when everything else is crashing.
How do I buy bonds?
You can buy bonds individually, but you tend to need to have a fair amount of money to do so and you can run into a lot of problems with liquidity, big bid/ask spreads etc, it’s hard to build up a diversified portfolio etc.
I buy bonds the same way I buy stocks, ie via an ETF. Most of the major ETF providers have some variety of index ETFs tracking Treasury only or Treasury plus Investment Grade bonds, or you can buy HY stuff if you want. Personally I just use one ETF which has about 75% in treasuries and the rest in IG. There are also some actively managed bond funds out there, either as ETFs or managed funds.
For the reasons I outlined above about bonds being a psychological safe harbour I personally would (and do) only invest in bonds which are likely to up in a crisis, but different strokes for different folks applies as always.
Any more questions?
I’ve only really scratched the surface here of talking about bonds, but at the same time I feel like it’s an overwhelming amount of information. If you have more questions then as always I’m happy to answer them in the comments!
Do you invest in bonds? If you enjoyed this post and would like to read more like it then please subscribe!
submitted by AussieHIFIRE to fiaustralia [link] [comments]

A guide to index funds

A few weeks ago I wrote a post about some things it took me a while to figure out when I started investing. This was well received, and there were some interesting follow up questions, especially around what to invest in. A commonly recommended strategy on this sub-reddit is to invest in index funds, but that was another thing that it took me a while to figure out, and my first post didn't really get that far, so I present the spiritual successor: Things I Wish I'd Known Earlier About Index Funds
This write-up is intended to broadly answer the question:
How do I invest in a way that my returns will track the overall UK, US, or global stock market?
N.B. I've also cross-posted this to a https://reboapp.co.uk/content/index-funds/, which is a knowledge base I'm building for UK investors. Let me know if there are any particular topics you'd like me to write about in future.

What is an index?

An index is a calculated value that summarises the performance of some category of assets into a single number which can be tracked over time. For indexes which track stock markets, this is typically the total valuation of the companies in some section of the stock market. For example, the FTSE 100 is an index which tracks the value of the largest 100 companies listed on the London Stock Exchange.
Market indexes are normally calculated using capitalisation weighting, where the companies included in the index are selected based on their market valuation, and the larger the market valuation of a company, the more weight it is given in the index.

What is a capitalisation-weighted index?

In a capitalisation-weighted index, the index is calculated by summing the total market value of all of the companies. This means that if one company is worth £20 billion, and another is worth £10 billion, the former company will contribute twice as much to the index. A 10% increase in the price of the former company would increase the index by twice as much as a 10% rise in the latter company.
An index is also usually normalised, so that it starts at a nice value like 1,000 on the first day it is measured. This normalisation happens by recording the sum of the market values of the companies on the first day, and then dividing later measures by this amount.

What is an index fund?

An index fund (also commonly referred to as a 'tracker') is a wrapper which will hold shares in the various assets in an index, weighted by the same weighting as in the index, so that the value of the index fund should track the underlying index closely over time. If the index goes up by 3%, then so should the index fund.
For example, an index fund which tracks the FTSE 100 has £1 billion invested in it in total, then that £1 billion will be used by the fund manager to buy £1 billion worth of shares in the FTSE 100 companies, weighted by their market value, so that the fund would hold twice as much of a £20 billion company than a £10 billion company. As the valuations rise and fall, and as companies come in and out of the FTSE 100, the index fund will buy and sell shares to keep their allocation as close to the FTSE 100 weighting as possible.

Why use capitalisation weighting for an index?

By using a capitalisation-weighted index, the index is measuring how the market is choosing to allocate capital. If the market value of one company in the index is £20 billion (the total value of all of the company's shares adds up to £20 billion), and another company has a market value of £10 billion, then the shareholders are valuing the first company at twice as much as the second. If they weren't, then some people would sell shares in the company that they thought was overvalued, and buy shares in the other company that they thought was undervalued, until the prices shifted to match what people think. Of course some people might think this, while others think the opposite, so the market value only represents the average sentiment of the shareholders. There is no correct objective valuation, only the valuation that comes from the average of all the shareholder decisions. This is why we talk about market value rather than just value. By using a capitalisation-weighted index, the index tracks this market valuation.
Now we could define loads of different indexes based on completely different criteria. For example, rather than worrying about market capitalisation, we could form an index based upon the value of all companies whose names begin with an 'L'. It's unlikely that this would tell us anything particularly interesting about the market though!

Why the market average is the best you can do

When you invest in an index fund tracking a capitalisation-weighted index, you are delegating your investment decisions to the market. You will be investing in companies in the index in proportion to how much capital everyone else has invested in these companies. This may seem like blindly following the herd, and you might think that you can do better than this, but you almost certainly can't.
The reason you can't beat the market is that it's a zero-sum game - if you're going to do better than the average, someone else has to do worse than the average. So if you are going to do better than the market average over the long term, you need to make better decisions than at least 50% of the other people making active investment decisions. When the market contains institutional investors, hedge funds, people with PhDs, very fast computers, and significant amounts of money, it's unlikely that you're going to be in the upper half.
Instead of trying to beat the market average yourself, you might be tempted to invest in an actively managed fund, where the investors try to make strategic picks to beat the market. The managers of such funds certainly have more resources available to them than you, and some even have excellent histories of market beating returns. However, there's no way for you to tell if an actively managed fund is actually better than the market average, or if they've just been lucky in the past.
To illustrate this, consider the following thought experiment: If I pick 500 people and ask them to flip a coin 10 times in a row, I'd expect one or two of them to get 10 heads in row. If we pick one of those people, and look at their coin flipping record, then this person appears to be very talented at flipping a coin and getting heads. However, if I asked them to flip the coin again, they would have a 50/50 chance, just like everyone else. So in a world where there are many actively managed funds, some will have done better than the market average in the past. But how can we tell whether they were just lucky, or, on the contrary, if they will continue to beat the market? The unfortunate answer is you likely can't.

Structure of Index Funds

So far, we've covered the basics of the index fund concept, but in order to actually get your money invested, you'll need to know a little bit about what real index funds look like in practice. If you haven't already, this might be a good time to review my original post on getting started with investing.
In the UK there are two common types index funds:
The legal structure of these funds doesn't matter too much to you as a personal investor, but there are some differences between OEICs and ETFs that you should be familiar with:
For more information on the differences between OEICs and ETFs, check out this write up from Monevator, as well as the wiki here in /ukpersonalfinance:

Company size, geography and other factors

Hopefully the previous sections have demystified the workings of indexes and index funds to some degree. However, you may still have questions about which index funds to invest in. That's worth a whole separate write up, but here is a brief overview of the landscape of some of the different types of index funds that are available:

Large cap, mid cap and small cap

Large cap companies are those with the largest capitalisations, and in the UK typically refers to the FTSE 100 companies. That is, the largest 100 companies in the UK. The smallest company in the FTSE 100 has a market capitalisation of around £4 billion. Some example index funds tracking large cap companies are:
Mid cap companies are those with smaller capitalisations, typically referring to the FTSE 250 companies, which are the 101st-350th companies in the UK by market capitalisation. The market capitalisation of these ranges between around £4 billion to £500 million. Some example index funds:
Small cap companies are those with smaller market capitalisations still, but it's a less well defined list than large or mid cap companies. An example index fund:

Geography

Index funds also provide a convenient way to invest in foreign markets, outside the UK. The funds are located in the UK, and priced in GBP, so they are very accessible to a UK investor, but can hold investments in European, US, or global markets.
The S&P 500 index is similar to the FTSE 100 index in the UK, but tracking the top 500 companies in the US. The Vanguard S&P 500 ETF is an index fund tracking the S&P 500.
Likewise, the EURO STOXX 50 index tracks the largest 50 companies in Europe, and can be invested in through index funds such as the iShares EURO STOXX 50 UCITS ETF.
There also exist indexes which aim to track the global market, such as the MSCI World index.

Other assets

As well as indexes which track company valuations, there are indexes which track bond valuations. For example the Vanguard UK Government Bond Index Fund aims to track the Bloomberg Barclays U.K. Government Float Adjusted Bond Index.
Index funds can also track other asset classes, like gold, property, and even alternative assets like Bitcoin.

Funds of funds

A single index typically represents a narrow cross section of the world, likely tracking only companies of a certain size, in a certain region, or a certain asset class. You may need to hold investments tracking multiple indexes in order to have a diversified portfolio across different assets types, company sizes and geographies. Rather than doing this manually, it is also possible to invest directly in a fund of funds. In this case, the fund holds a number of different underlying funds, tracking different indexes. This allows a single fund to have appropriate diversification.
Some examples of these funds of funds, particularly those aimed at passive investors are:
Hopefully this article has helped to explain what an index fund is, and why you might be interested in investing in index funds. The above examples are certainly not a full list of the available indexes and index funds, and you should definitely do further research into which funds are most appropriate for your investment goals.
Good luck with your investment journey!
submitted by jpallen to UKPersonalFinance [link] [comments]

In the Shade of Afternoon | Monthly FI Portfolio Update – August 2019

It is idle, having planted an acorn in the morning, to expect that afternoon to sit in the shade of the oak.
Antoine de Saint-Exupéry, Wind, Sand and Stars
This is my thirty-third portfolio update. I complete this update monthly to check my progress against my goals.
Portfolio goals
My objectives are to reach a portfolio of:
Both of these are based on an expected average real return of 4.19%, or a nominal return of 7.19%, and are expressed in 2018 dollars.
Portfolio summary
Vanguard Lifestrategy High Growth Fund – $750 246 Vanguard Lifestrategy Growth Fund – $43 194 Vanguard Lifestrategy Balanced Fund – $79 500 Vanguard Diversified Bonds Fund – $110 418 Vanguard Australian Shares ETF (VAS) – $102 977 Vanguard International Shares ETF (VGS) – $20 184 Betashares Australia 200 ETF (A200) – $258 984 Telstra shares (TLS) – $1 982 Insurance Australia Group shares (IAG) – $14 056 NIB Holdings shares (NHF) – $8 868 Gold ETF (GOLD.ASX) – $104 149 Secured physical gold – $16 759 Ratesetter* (P2P lending) – $19 968 Bitcoin – $158 330 Raiz* app (Aggressive portfolio) – $16 223 Spaceship Voyager* app (Index portfolio) – $2 104 BrickX (P2P rental real estate) – $4 395 Total value: $1 712 337 (-$2 653)
Asset allocation
Australian shares – 40.5% (4.5% under) Global shares – 22.2% Emerging markets shares – 2.4% International small companies – 3.1% Total international shares – 27.7% (2.3% under) Total shares – 68.3% (6.7% under) Total property securities – 0.3% (0.3% over) Australian bonds – 5.1% International bonds – 10.1% Total bonds – 15.1% (0.1% over) Gold – 7.1% Bitcoin – 9.2% Gold and alternatives – 16.3% (6.3% over)
Presented visually, below is a high-level view of the current asset allocation of the portfolio.
[Chart]
Comments
The portfolio experienced a small decline this month, with an overall decrease of $2 600. This movement comes after a strong period of expansion through the first half of the year in the value of the portfolio.
[Chart]
As with last month, the fall occurs despite some significant new investments being made, meaning the absolute size of the decline is somewhat obscured. Renewed concerns about global trade and a relative weakening in the outlook for future earnings played a significant role in the overall movement of the portfolio.
[Chart]
Once again movements this month within the portfolio have been relatively limited in terms of the size of the portfolio.
Equity holdings have declined by around $28 000 when contributions are accounted for, whilst appreciation in the price of gold has offset just over a third of that loss. In fact, despite no recent purchases, the gold component of the portfolio is currently at the highest nominal value it has ever held.
On the topic of gold, this 2013 paper (pdf) provides a comprehensive and skeptical empirical analysis of the range of claims made to support holding gold, including tracing the real gold value of average soldiers pay across 2000 years.
This month has seen a continuing 'averaging in' of the capital from July distributions. These have been directed to purchases of Vanguard's Australian shares ETF (VAS). This is to bring the allocation closer to my original targets - with my Australian shares allocation currently further underweight than the international shares allocation. Psychologically, a weakening Australian dollar has also made purchasing unhedged international shares more problematic.
Risk, volatility, markets and economies
There has been significant market volatility this month, and discussion around the future of Australian and global growth in the midst of trade tensions between US and China.
In such times, something to remember as this St Louis Federal Reserve piece points out, is that the economy and sharemarket are not the same thing. This means that bad (or good) news for one, does not necessarily imply anything about the other. Missing this has the potential to lead to overconfident investment actions predicated on assumptions of future national economic trends (which will themselves most likely be priced into equity markets well before any retail investor reading the news arrives).
The volatility in equity markets has brought out many well-intentioned injunctions to remain calm and fixed on the objective of contributing capital with a long-term view in mind.
At times, however, this wise advice can shade into a form of near complacency - for example, for people to invest confident in the knowledge that long-term returns are (almost) guaranteed. No doubt this is generally good advice, directed at easing particularly new investors' concerns about investing at the "wrong" time, and reducing the potential damage from selling into falling markets due to panic.
Even as I continue to invest amidst volatility, it is important to reflect on Elroy Dimson's definition that 'risk means more things can happen than will happen', and to consider that the history of equity markets available to us provides only a basis for sound conclusions around what has happened, not what could happen. This is the definition of the risk assumed in markets by investors.
None of this is to suggest that starting, saving and regular investing with a view to one's individual risk tolerances are not the most important steps in the path to FI. There is a need to pause, however, and acknowledge that at times common financial independence investment precepts bear a disconcerting passing resemblance to the declaration and mathematical proof offered by famous stock promoter Jacob J Raskob in the well-known Ladies Home Journal (pdf) article exactly 90 years ago. This declaration was that with a steady investment in equities, based on the past patterns of returns, 'everybody ought to be rich'.
Nearly 90 years happened to be just before the Great Depression devastated equity markets and employment prospects alike, and US equity investors were behind in nominal terms for around 25 years. Interestingly, however, this New York Times article argues that deflation, higher dividend yields and impacts from changes in the Dow index composition could theoretically have shortened the real losses of any investor to just 4.5 years, provided they possessed the resources and fortitude to hold on to average stocks.
Progress
Progress against the objectives, and the additional measures I have reached is set out below.
Measure Portfolio All Assets Objective #1 – $1 598 000 (or $67 000 pa) 107.1% 145.4% Objective #2 – $1 980 000 (or $83 000 pa) 86.5% 117.4% Credit card purchases - $73 000 pa 98.3% 133.4% Total expenses - $89 000 pa 80.7% 109.4%
Summary
Progress against my goals and benchmarks has been static this month, with the exception of the 'total expenditure' benchmark. My detailed review of expenditure last month identified that I could lower this to recognise some double-counting of fixed expenses, and this has meant a leap forward in progress in that aim of 5.8 per cent. This moves the clock forward appreciably for achieving that benchmark.
As a general rule, it is always later than we think. For example, on a recent lunch time walk it occurred to me that if my progress to my current FI target of $1.98 million is considered in terms of the length of an ordinary working day, it is currently approximately 3.50pm in the afternoon. Quite late, and just over an hour until heading home.
This perspective, of being further towards the tail end than expected, is explored fully and powerfully in the blog Wait but Why here. It helps frame the remaining journey. Viewed in this way, wishing time away seems less useful and fitting than seeking to fill the remaining time with as much meaning, learning, knowledge transmission and patience as feasible. Yet it also explains why in a FI context at this stage sharp changes in investing approach, or commencing new 'side hustles' have limited appeal.
Despite it being late afternoon from this one perspective, there are a couple of other considerations or viewpoints. One is the potentially deceptive role of compounding later in the journey, which means that - at least in a stylised world of 'smooth returns' - the end goal is actually likely closer than any purely linear measure would suggest.
The other counterpoint to this is that while in my case the absolute journey to FI has involved serious investments over around 18 years, this is not the whole story. Viewed in terms of the average 'age' of dollars actually contributed or invested, the journey of the average dollar in the portfolio has been shorter.
In fact, in terms of dollars contributed, around 50 per cent have been contributed since January 2016. So, in some ways, it is more akin to mid-morning for the portfolio as a whole, meaning perhaps that I should not reasonably expect to shade myself under the oak tree just yet.
Finally, this month also saw Pat the Shuffler emerge from a short hiatus and provide a honest and well-argued insight into his rethink on investment options between LICs and ETFs. I also enjoyed reading the start of another Australian FI voice at Fire for One.
The past few months has also had many interesting podcasts related to FI - from The Escape Artists' Chris Reining on Equity Mates, to a really fascinating practical ChooseFI episode on David Sawyer's on the UK Path to FI. On the slightly more technical and future focused side of finance, the outgoing address of the Bank of England's Governor to the Jackson Hole central bankers gathering provides much food for thought on current and longer term monetary and currency issues, particularly as global bond rates continue to cross the 'zero-bound' into uncharted territory.
The post and full charts can be seen here.
submitted by thefiexpl to fiaustralia [link] [comments]

J.P. Morgan Early Look at the Market – Mon 10.16.17 - **PLEASE DO NOT FORWARD THIS DOCUMENT**

J.P. Morgan Early Look at the Market – Mon 10.16.17

SEC DISCLAMIER: PLEASE DO NOT FORWARD THIS DOCUMENT

Morning Levels

Trading Update

Top Headlines for Monday

Catalysts – big events to watch over the coming months

Full catalyst list

  • Wed Oct 18 – Fed speakers: Dudley, Kaplan.
  • Wed Oct 18 – US housing starts for Sept. 8:30amET.
  • Wed Oct 18 – US building permits for Sept. 8:30amET.
  • Wed Oct 18 – US Beige Book. 2pmET.
  • Wed Oct 18 – earnings before the open: ABT, Akzo Nobel, ASML, MTB, MTG, NTRS, Reckitt Benckiser, SVU, USB
  • Wed Oct 18 – earnings after the close: AA, AXP, BDN, BHE, BXS, CCI, CCK, EBAY, GHL, HXL, KALU, LLNW, SLG, SLM, STLD, TCBI, URI.
  • Thurs Oct 19 – China Q3 GDP and Sept retail sales, IP, and FAI (Wed night/Thurs morning)
  • Thurs Oct 19 – US Leading Index for Sept. 10amET.
  • Thurs Oct 19 – earnings before the open: ADS, BBT, BK, BX, DGX, DHR, DOV, GPC, KEY, Nestle, NUE, Pernod Ricard, Philips Lighting, PM, PPG, Publicis, RCI, Roche, SAP, SNA, SON, Thales, TRV, TSMC, TXT, Unilever, VZ, WBC, WGO.
  • Thurs Oct 19 – earnings after the close: ASB, ATHN, ETFC, ISRG, LHO, MXIM, NCR, PBCT, PFPT, PYPL, WDFC, WERN.
  • Fri Oct 20 – BOJ’s Kuroda speaks. 2:30amET.
  • Fri Oct 20 – US existing home sales for Sept. 10amET.
  • Fri Oct 20 – Yellen speaks to National Economists Club in Washington. 7:15pmET.
  • Fri Oct 20 – earnings before the open: Assa Abloy, BHGE, CFG, CLF, Daimler, DST, GE, GNTX, HON, InterContinental Hotels, KSU, MAN, PG, SLB, STI, SYF, TomTom, Volvo.
  • Mon Oct 23 – China Sept property prices (Sun night/Mon morning).
  • Mon Oct 23 – US Chicago Fed Activity Index for Sept. 8:30amET.
  • Mon Oct 23 – earnings before the open: HAL, HAS, ITW, KMB, LII, Philips, STT, STX, VFC
  • Mon Oct 23 – earnings after the close: ARNC, CR, JBT, OI, ZION.
  • Tues Oct 24 – Eurozone flash PMIs for Oct. 4amET.
  • Tues Oct 24 – ECB bank lending survey. 4amET.
  • Tues Oct 24 – US flash PMIs for Oct. 9:45amET.
  • Tues Oct 24 – earnings before the open: AMTD, Anglo American, BASF, BIIB, CAT, CLB, CNC, CVLT, ETR, Fiat Chrysler, FITB, GLW, GM, INFY, IPG, LLY, LMT, MAS, MCD, MMM, Novartis, PCAR, PHM, PNR, R, RF, SAH, SHW, SWK, UTX, WAT, WDR.
  • Tues Oct 24 – earnings after the close: AKAM, AMP, AXS, Canadian National Railway, CMG, COF, CYBE, DFS, ESRX, HLI, IRBT, IRM, MANH, NUVA, RGC, T, TSS, TXN.
  • Wed Oct 25 – US durable goods for Sept. 8:30amET.
  • Wed Oct 25 – US FHFA home price index for Aug. 9amET.
  • Wed Oct 25 – US new home sales for Sept. 10amET.
  • Wed Oct 25 – Bank of Canada rate decision. 10amET.
  • Wed Oct 25 – Brazilian rate decision (after the close).
  • Wed Oct 25 – earnings before the open: ALK, ALLY, ANTM, Antofagasta, AOS, APH, BA, BAX, BTU, Capgemini, Dassault Systemes, DPS, FCX, FLIR, Fresnillo, HBAN, Heineken, IP, IR, KO, LEA, LH, Lloyds Banking Group, NDAQ, NSC, NYCB, OC, Peugeot, SIRI, SLAB, TMO, TUP, V, WBA, WEC, WYN.
  • Wed Oct 25 – earnings after the close: ABX, ACGL, AFL, AMGN, CA, CLGX, DLR, FFIV, FNF, FTI, KIM, LSTR, MC, MLNX, NOW, NXPI, ORLY, PKG, PLXS, RJF, SSNC, TSCO, TYL, UNM, VAR, WCN, XLNX.
  • Thurs Oct 26 – Riksbank decision. 3:30amET.
  • Thurs Oct 26 – ECB rate decision. 7:45amET press release, 8:30amET press conf.
  • Thurs Oct 26 – US wholesale inventories for Sept. 8:30amET.
  • Thurs Oct 26 – US advance goods trade balance for Sept. 8:30amET.
  • Thurs Oct 26 – US pending home sales for Sept. 10amET.
  • Thurs Oct 26 – earnings before the open: ABB, ABX, Aixtron, ALLE, ALV, Anheuser Busch, APD, Bayer, BEN, BMS, BMY, BSX, BWA, CCMP, CELG, CHTR, CMCSA, CME, COP, Deutsche Bank, ENTG, EQT, EXLS, F, GNC, HLT, HSY, LUV, MMC, MKC, NEM, Nokia, OAK, ODFL, PX, Santander, Schneider Electric, SPGI, STM, TWTR, UNP, UPS, VC, VNTV, WM, XEL, XRX.
  • Thurs Oct 26 – earnings after the close: AIV, ATEN, CB, CDNS, CENX, CLS, EXPE, FLEX, FTNT, FTV, GILD, GOOG, HIG, INTC, LPLA, MAT, MSFT, NATI, PFG, PRO, SGEN, SIVB, SYK, VDSI, VRSN.
  • Fri Oct 27 – China Sept industrial profits (Thurs night/Fri morning).
  • Fri Oct 27 – US Q3 GDP, personal consumption, and core PCE for Q3. 8:30amET.
  • Fri Oct 27 – US Michigan Confidence numbers for Oct. 10amET.
  • Fri Oct 27 – earnings before the open: B, MRK, PSX, SC, TRU, Volkswagen, WY, XOM.
  • Mon Oct 30 – US personal income/spending and PCE for Sept. 8:30amET.
  • Mon Oct 30 – US Dallas Fed index for Oct. 10:30amET.
  • Mon Oct 30 – analyst meetings: CSX
  • Mon Oct 30 – earnings before the open: HSBC
  • Mon Oct 30 – earnings after the close: AVB, CGNX, RE, RTEC, VNO
  • Tues Oct 31 – BOJ rate decision (Mon night/Tues morning).
  • Tues Oct 31 – US Employment Cost Index for Q3. 8:30amET.
  • Tues Oct 31 – US Case-Shiller home price index for Aug. 9amET.
  • Tues Oct 31 – US Chicago PMI for Oct. 9:45amET.
  • Tues Oct 31 – US Conference Board Sentiment readings for Oct. 10amET.
  • Tues Oct 31 – earnings before the open: ADM, AET, Airbus, AMT, Barclays, BNP, CMI, ECL, FIS, GGP, K, MA, OSK, PFE, XYL.
  • Tues Oct 31 – earnings after the close: APC, CHRW, CXO, PLT, WFT, X
  • Wed Nov 1 – US ADP jobs report for Oct. 8:15amET.
  • Wed Nov 1 – US Markit Manufacturing PMI for Oct. 9:45amET.
  • Wed Nov 1 – US Manufacturing ISM for Oct. 10amET.
  • Wed Nov 1 – US construction spending report for Sept. 10amET.
  • Wed Nov 1 – US auto sales for Oct.
  • Wed Nov 1 – FOMC meeting decision. 2pmET.
  • Wed Nov 1 – earnings before the open: AGN, APO, CEVA, CLX, EL, GRMN, HFC, LFUS, Novo Nordisk, ORBK, Standard Chartered, TAP, TRI.
  • Wed Nov 1 – earnings after the close: ALL, BHF, BXP, CACI, CAVM, CSGS, EGOV, FB, LNC, MANT, MET, MUSA, OXY, PRU, QCOM, ULTI, XPO.
  • Thurs Nov 2 – BOE rate decision. 8amET.
  • Thurs Nov 2 – US nonfarm productivity and unit labor costs for Q3. 8:30amET.
  • Thurs Nov 2 – earnings before the open: ADP, AN, BCE, CI, Credit Suisse, DISCA, H, ICE, LDOS, Royal Dutch Shell, Sanofi, Swiss Re, WRK.
  • Thurs Nov 2 – earnings after the close: AAPL, AIG, ATVI, CBS, CRUS, FLR, HLF, JCOM, RMAX, SBUX, UNIT.
  • Fri Nov 3 – US jobs report for Oct. 8:30amET.
  • Fri Nov 3 – US trade balance for Sept. 8:30amET.
  • Fri Nov 3 – US factory orders and durable goods orders for Sept. 10amET.
  • Fri Nov 3 – US non-manufacturing ISM for Oct. 10amET.
  • Mon Nov 6 – Fed’s Dudley speaks at The Economist Club of New York.
  • Tues Nov 7 – RBA rate decision. Mon night/Tues morning.
  • Tues Nov 7 – US JOLTs jobs report for Sept. 10amET.
  • Tues Nov 7 – US consumer credit for Sept. 3pmET.
  • Thurs Nov 9 – US wholesale trade sales/inventories for Sept. 10amET.
  • Fri Nov 10 – US Michigan Confidence preliminary numbers for Nov. 10amET.
  • Tues Nov 14 – US PPI for Oct. 8:30amET.
  • Wed Nov 15 – US CPI for Oct. 8:30amET.
  • Wed Nov 15 – US Empire Manufacturing for Nov. 8:30amET.
  • Wed Nov 15 – US retail sales for Oct. 8:30amET.
  • Wed Nov 15 – US business inventories for Sept. 10amET.
  • Thurs Nov 16 – US import prices for Oct. 8:30amET.
  • Thurs Nov 16 – US industrial production for Oct. 9:15amET.
  • Thurs Nov 16 – US NAHB housing index for Nov. 10amET.
  • Fri Nov 17 – US housing starts and building permits for Oct. 8:30amET.
  • Mon Nov 20 – US Leading Index for Oct. 10amET.
  • Tues Nov 21 – US existing home sales for Oct. 10amET.
  • Wed Nov 22 – US durable goods for Oct. 8:30amET.
  • Wed Nov 22 – US final Michigan Confidence numbers for Nov. 10amET.
  • Wed Nov 22 – FOMC 11/1 meeting minutes. 2pmET.
  • Fri Nov 24 – US flash PMIs for Nov. 9:45amET.
J.P. Morgan Market Intelligence is a product of the Institutional Equities Sales and Trading desk of J.P. Morgan Securities LLC and the intellectual property thereof. It is not a product of the Research Department and is intended for distribution to institutional and professional customers only and is not intended for retail customer use. It may not be reproduced, redistributed or transmitted, in whole or in part, without J.P. Morgan’s consent. Any unauthorized use is strictly prohibited.
submitted by SIThereAndThere to wallstreetbets [link] [comments]

Cryptocurrency and Blockchain - Industry News (02.15.19 - 02.22.19)

Total Market Cap, as of 02.21.19 at 5:30pm (PST): $133,778,212,242 (+11.11% from last week)

Missed last week's update? Click here

STORY OF THE WEEK

•A developer in the community released Tippin.me, a Chrome and Firefox browser extension that enables Bitcoin (BTC) tipping on Twitter via the Lightning Network.

CRYPTOCURRENCY EXCHANGES

Binance launches the test-net of its allegedly decentralized exchange, Binance DEX. Users can now manage their own private keys and the associated wallet.
Binance de-lists 5 projects – CloakCoin (CLOAK), Modum (MOD), Salt (SALT), Substratum (SUB) and Wings (WINGS).
Huobi.com lists 3 projects – Stellar Lumens (XLM), Monero (XMR) and Steem (STEEM).
Coinmama, a Slovakian based exchange suffers a security breach which leaked 450,000 user email and passwords.
KuCoin releases version 2.0 of its platform. The update introduces new interfaces across the web and mobile applications, additional 2FA options and order types for users.

REGULATION

•The U.S. state of Wyoming passed 3 bills that involve digital assets. Digital assets owned by consumers are now categorized as intangible personal property. Banks can now issue digital custodial services and issue securities in tokenized forms, provided they comply with accounting, control and other standards.
•The U.S. Securities and Exchange Commission (SEC) settles unregistered securities charges against Gladius Network, whom have conducted an ICO near the end of 2017. There is no penalty as a result of self-reporting.
•$430,000 USD worth of cryptocurrencies seized by Belgian law enforcement will be auctioned off on Feb.28 at 12:00pm GMT by Wilsons Auctions – the largest auction company in the UK and Ireland.
•The Central Bank of Bahrain’s (CBB) is launching a regulatory sandbox for blockchain and crypto companies. This will allow firms to test solutions and expedite new companies entrance into the market.
•2 Bitcoin ETF’s registered by financial firms VanEck/SolidX and Bitwise await approval from the U.S Securities and Exchange Commission (SEC). This kicks off a 45 day countdown to an initial decision.

TECHNOLOGY

Samsung’s flagship phone, the Galaxy S10 will introduce “Samsung Knox”, a hardware security feature to store private keys for blockchain applications.
Facebook’s CEO Mark Zuckerberg considers utilizing a blockchain to allow users to login to other sites without going through an intermediary on its existing “sign-in with Facebook” feature, dubbed Facebook Connect.

INSTITUTIONALIZATION

Eurex, a derivatives exchange operated by German financial giant Deutsche Boerse is looking to launch futures contracts tied to digital assets such as Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP).
•Latin America’s largest investment bank Banco BTG Pactual SA is releasing its own blockchain-based security token dubbed “ReitBZ”. The token’s value is backed by real estate assets within Brazil.

PEOPLE

Ethereum loses Afri Schoedon, a core developer for the open-sourced project since 2015.
TrueDigital, a provider of institutional products for digital assets hires Thomas Kim – previously COO of Bridgewater Associates. Bridgewater is a U.S based asset management firm with currently $124.7 billion USD under management.
Digital Asset, a distributed ledger company for financial services loses head of business for Europe, Oliver Hugh-Jones. Key executives continue to depart from the firm.

TWITTER

@jack – “I hooked [tippin.me] up and already got tipped some satoshi’s.”
@alecziupsnys – “Taxi reform didn't come from taxis, but from Uber. Hotel reform didn't come from hotels, but from AirBnB. Finance reform didn't come from banks, but from Bitcoin.“
@cryptoshillnye – “We are either really early or really stupid. $crypto”
@jackdwagner – “If your boyfriend needs to be taken down a notch just start casually asking him how his bitcoin is doing.”
submitted by Edmund_N to CryptoMarkets [link] [comments]

Cryptocurrency and Blockchain - Industry News (02.15.19 - 02.22.19)

Total Market Cap, as of 02.21.19 at 5:30pm (PST): $133,778,212,242 (+11.11% from last week)
Missed last week's update? Click here

STORY OF THE WEEK

•A developer in the community released Tippin.me, a Chrome and Firefox browser extension that enables Bitcoin (BTC) tipping on Twitter via the Lightning Network.

CRYPTOCURRENCY EXCHANGES

Binance launches the test-net of its allegedly decentralized exchange, Binance DEX. Users can now manage their own private keys and the associated wallet.
Binance de-lists 5 projects – CloakCoin (CLOAK), Modum (MOD), Salt (SALT), Substratum (SUB) and Wings (WINGS).
Huobi.com lists 3 projects – Stellar Lumens (XLM), Monero (XMR) and Steem (STEEM).
Coinmama, a Slovakian based exchange suffers a security breach which leaked 450,000 user email and passwords.
KuCoin releases version 2.0 of its platform. The update introduces new interfaces across the web and mobile applications, additional 2FA options and order types for users.

REGULATION

•The U.S. state of Wyoming passed 3 bills that involve digital assets. Digital assets owned by consumers are now categorized as intangible personal property. Banks can now issue digital custodial services and issue securities in tokenized forms, provided they comply with accounting, control and other standards.
•The U.S. Securities and Exchange Commission (SEC) settles unregistered securities charges against Gladius Network, whom have conducted an ICO near the end of 2017. There is no penalty as a result of self-reporting.
•$430,000 USD worth of cryptocurrencies seized by Belgian law enforcement will be auctioned off on Feb.28 at 12:00pm GMT by Wilsons Auctions – the largest auction company in the UK and Ireland.
•The Central Bank of Bahrain’s (CBB) is launching a regulatory sandbox for blockchain and crypto companies. This will allow firms to test solutions and expedite new companies entrance into the market.
•2 Bitcoin ETF’s registered by financial firms VanEck/SolidX and Bitwise await approval from the U.S Securities and Exchange Commission (SEC). This kicks off a 45 day countdown to an initial decision.

TECHNOLOGY

Samsung’s flagship phone, the Galaxy S10 will introduce “Samsung Knox”, a hardware security feature to store private keys for blockchain applications.
Facebook’s CEO Mark Zuckerberg considers utilizing a blockchain to allow users to login to other sites without going through an intermediary on its existing “sign-in with Facebook” feature, dubbed Facebook Connect.

INSTITUTIONALIZATION

Eurex, a derivatives exchange operated by German financial giant Deutsche Boerse is looking to launch futures contracts tied to digital assets such as Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP).
•Latin America’s largest investment bank Banco BTG Pactual SA is releasing its own blockchain-based security token dubbed “ReitBZ”. The token’s value is backed by real estate assets within Brazil.

PEOPLE

Ethereum loses Afri Schoedon, a core developer for the open-sourced project since 2015.
TrueDigital, a provider of institutional products for digital assets hires Thomas Kim – previously COO of Bridgewater Associates. Bridgewater is a U.S based asset management firm with currently $124.7 billion USD under management.
Digital Asset, a distributed ledger company for financial services loses head of business for Europe, Oliver Hugh-Jones. Key executives continue to depart from the firm.

TWITTER

@jack – “I hooked [tippin.me] up and already got tipped some satoshi’s.”
@alecziupsnys – “Taxi reform didn't come from taxis, but from Uber. Hotel reform didn't come from hotels, but from AirBnB. Finance reform didn't come from banks, but from Bitcoin.“
@cryptoshillnye – “We are either really early or really stupid. $crypto”
@jackdwagner – “If your boyfriend needs to be taken down a notch just start casually asking him how his bitcoin is doing.”
submitted by Edmund_N to CryptoCurrency [link] [comments]

Weekly Crypto Recap for the week ending July 27

Developments in Financial Services

Regulatory

General News

submitted by QuantalyticsResearch to CryptoMarkets [link] [comments]

Weekly Crypto News Recap for the Week ending July 27

Developments in Financial Services

Regulatory

General News

submitted by QuantalyticsResearch to CryptoCurrency [link] [comments]

Newsdumps issues 18

News dumps issues 18##

Date: 17/03/2017
Front cover :http://imgur.com/jwafmUu
front cover :http://imgur.com/Eu9r8If
 
facebook page :https://www.facebook.com/Newsdumps-374921022874452/
 
Welcome to newsdumps issue 18
 
All the links is dump into one Reddit post
 
Playlist :
 
Spotify :https://play.spotify.com/use1137507342/playlist/1iLRLYjJEvdgSRNiMEC0gl
 
youtube :https://www.youtube.com/playlist?list=PLVCgpcp_ukXwLu6M6B_AuBOuey3q-Q-Ax
 
Movie of the week: Kong Skull island
 
a 2017 American monster film directed by Jordan Vogt-Roberts and written by Dan Gilroy, Max Borenstein and Derek Connolly, from a story by John Gatins.
 

Obscure news section

 

technology section

 

Gaming Section

 

local London news#

 

Obscure news section

 
week
 
 KOTAKU’S CHRIS PRIESTMAN CAUGHT IN FINANCIAL CONFLICT OF INTEREST 
http://www.oneangrygamer.net/2017/03/kotakus-chris-priestman-caught-in-financial-conflict-of-interest/25709/
 
 Blogger Says Dad in Hilarious Viral BBC Video With Kids Interrupting Is ‘Patriarchy in Nutshell’ 
https://heatst.com/culture-wars/blogger-says-dad-in-hilarious-viral-bbc-video-with-kids-interrupting-is-patriarchy-in-nutshell/
 
 ‘Sexist’ Tech Moguls Under Fire For Attending Exclusive ‘Babes and Balls’ Party 
https://heatst.com/tech/sexist-tech-moguls-under-fire-for-attending-exclusive-babes-and-balls-party/
 
 Wake Up, Twitter: Your Filtering Algorithm Is Killing Conversations 
https://heatst.com/tech/wake-up-twitter-your-filtering-algorithm-is-killing-conversations/
 
 Harvard library circulating 'fake news' list, which, of course, includes just about every conservative news site 
http://www.washingtonexaminer.com/harvard-circulating-list-of-fake-news-sites-which-of-course-includes-conservative-news-sites/article/2617103#!
 
 Carleton University faces backlash after scale removed from gym 
http://www.cbc.ca/news/canada/ottawa/carleton-gym-remove-scale-controversy-1.4021378
 
https://heatst.com/culture-wars/carleton-university-removes-weight-scale-from-gym-after-students-call-it-triggering/?mod=sm_fb_post
 
 WONDER WOMAN TRAILER COVERS DIANA’S ORIGINS AND AVOIDS FEMINIST TALKING POINTS 
http://www.oneangrygamer.net/2017/03/wonder-woman-trailer-covers-dianas-origins-and-avoids-feminist-talking-points/25873/
 
 Meet Silicon Valley's Secretive Alt-Right Followers [Includes gamedropping] 
https://www.reddit.com/KotakuInAction/comments/5z6vu5/meet_silicon_valleys_secretive_altright_followers/
 
 Wake Up, Twitter: Your Filtering Algorithm Is Killing Conversations 
https://heatst.com/tech/wake-up-twitter-your-filtering-algorithm-is-killing-conversations/?mod=sm_fb_post
 
 Calls for Boycott After Grocery Chief Calls White Males ‘An Endangered Species’ 
https://heatst.com/culture-wars/calls-for-boycott-after-grocery-chief-calls-white-males-an-endangered-species/?mod=sm_fb_post
 
 NY Court Will Decide This Week if Chimps Have The Same Rights as People 
https://heatst.com/culture-wars/does-a-chimp-have-the-same-rights-as-a-person-new-york-court-will-decide-this-week/?mod=sm_fb_post
 
 UChicago student leaders slam their president for his commitment to free speech 
http://www.thecollegefix.com/post/31671/
 
 White male professors under fire, cited as obstacle to diversity and inclusion 
http://www.thecollegefix.com/post/31651/
 
 Ohio State student leaders want ‘safe spaces’ campus-wide 
http://www.thecollegefix.com/post/31618/
 
Fappening 2.0? Nude Pics of Emma Watson and Amanda Seyfried Spreading Fast https://heatst.com/tech/fappening-2-0-nude-pics-of-emma-watson-and-amanda-seyfried-spread-on-internet/
 

technology section

 
 Alphabet adds patent claim to Uber intellectual property theft lawsuit 
http://www.reuters.com/article/us-uber-alphabet-lawsuit-idUSKBN16H2GQ?feedType=RSS&feedName=technologyNews&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+reuters%2FtechnologyNews+%28Reuters+Technology+News%29
 
 eBay is doubling down on its advertising business, just like Amazon 
https://www.recode.net/2017/3/11/14893354/ebay-advertising-product-ads-in-house-sales
 
 EU reassured on U.S. privacy directive: source 
http://www.reuters.com/article/us-eu-dataprotection-usa-idUSKBN16H2KH?feedType=RSS&feedName=technologyNews&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+reuters%2FtechnologyNews+%28Reuters+Technology+News%29
 
 Nintendo Switch has reportedly been hacked using old browser exploit 
http://venturebeat.com/2017/03/12/nintendo-switch-has-reportedly-been-hacked-using-old-browser-exploit/
 
 Messaging app Viber is adding self-destructing chats for its 800 million users 
http://www.theverge.com/2017/3/10/14879986/viber-secret-chats-self-destructing-encryption
 
 Bitcoin drops 15% after the SEC rejects the Winklevoss ETF 
https://techcrunch.com/2017/03/10/bitcoin-drops-15-after-the-sec-rejects-the-winklevoss-etf/
 
 WIKILEAKS REVEAL CIA SPYING THROUGH TVS, PHONES; DNC FABRICATING RUSSIAN TIES 
http://www.oneangrygamer.net/2017/03/wikileaks-reveal-cia-spying-through-tvs-phones-dnc-fabricating-russian-ties/25525/
 
 With $4M in funding, VentureApp wants to be WhatsApp for your professional network 
https://techcrunch.com/2017/03/13/ventureapp/
 
 That time Facebook went too far 
https://techcrunch.com/2017/03/10/that-time-facebook-went-too-fa?ncid=rss
 
 YouTube launches Uptime, an experimental app for watching videos with friends 
https://techcrunch.com/2017/03/13/youtube-launches-uptime-an-experimental-app-for-watching-videos-with-friends/
 
 Snap’s revenue growth looks like it will come from more ads, not more users 
http://www.recode.net/2017/3/13/14875504/snapchat-revenue-user-growth-plans
 

Gaming section

week
 
 CRASH BANDICOOT N. SANE TRILOGY VIDEO REVEALS CRASH BANDICOOT 2 
http://www.oneangrygamer.net/2017/03/crash-bandicoot-n-sane-trilogy-video-reveals-crash-bandicoot-2/25827/
 
 RISING STORM 2: VIETNAM PAX EAST VIDEO REVEALS 1 HOUR OF GAMEPLAY 
http://www.oneangrygamer.net/2017/03/rising-storm-2-vietnam-pax-east-video-reveals-1-hour-of-gameplay/25834/
 
 MASS EFFECT: ANDROMEDA WON’T ALLOW FOR TEAMMATE CUSTOMIZATION 
http://www.oneangrygamer.net/2017/03/mass-effect-andromeda-wont-allow-for-teammate-customization/25940/
 
 ASIAN COUNTRIES PUSHING FOR VIDEO GAME ADDICTION TO BE LABELED A DISEASE, STATES REPORT 
http://www.oneangrygamer.net/2017/03/asian-countries-push-for-video-game-addiction-to-be-labeled-a-disease-states-report/25933/
 
 CD PROJEKT RED LOOKING FOR CONCEPT ARTISTS FOR CYBERPUNK 2077 
http://www.oneangrygamer.net/2017/03/cd-projekt-red-looking-for-concept-artists-for-cyberpunk-2077/25906/
 
 International Hearthstone Players Revolt Over Card Pack Price Hike 
https://gamerant.com/hearthstone-card-price-823/
 
 Project Scorpio Page Goes Live at Microsoft Store 
https://gamerant.com/project-scorpio-page-microsoft-store/
 
 The Nintendo PlayStation is the coolest console never released 
http://www.techradar.com/news/gaming/the-nintendo-playstation-is-the-coolest-console-never-released-1327988
 88 HEROES SET TO LAUNCH ON PS4, XBOX ONE, PC MARCH 24TH 
http://www.oneangrygamer.net/2017/03/88-heroes-set-to-launch-on-ps4-xbox-one-pc-march-24th/26122/
 
 NINTENDO SWITCH SELLS THROUGH 1.5 MILLION UNITS, ACCORDING TO SUPERDATA 
http://www.oneangrygamer.net/2017/03/nintendo-switch-sells-through-1-5-million-units-according-to-superdata/26110/

local London news

week
 
 Metropolitan Police to challenge High Court compensation order to two victims of black cab rapist John Worboys 
http://www.thisislocallondon.co.uk/news/15151667.Metropolitan_Police_to_challenge_High_Court_compensation_order_to_two_victims_of_black_cab_rapist_John_Worboys/
 
 Panic as crowd of 20 people trapped in suspended lift at St Pancras International station 
http://www.standard.co.uk/news/london/panic-as-crowd-of-20-people-trapped-in-suspended-lift-at-st-pancras-international-station-a3487791.html
 
 Tottenham vs Millwall: Shocking moment thug floors Spurs fan with single punch after FA Cup match 
http://www.standard.co.uk/news/london/millwall-vs-tottenham-shocking-moment-thug-floors-spurs-fan-with-single-punch-after-fa-cup-match-a3487756.html
 
 Hackney police officer sacked for failing to declare penalty points 
http://www.hackneygazette.co.uk/news/crime-court/hackney_police_officer_sacked_for_failing_to_declare_penalty_points_1_4928077
 
 Pervert who arranged to meet ‘girl’ after sex chats but was caught in online sting found guilty of grooming 
http://www.watfordobserver.co.uk/news/15151657.Pervert_who_arranged_to_meet____girl____after_sex_chats_but_was_caught_in_online_sting_found_guilty_of_grooming/
 
 Man admits rape of 81-year-old bus passenger in Balham 
http://www.bbc.co.uk/news/uk-england-london-39260772
 
 Bexley police chase stolen JCB digger from Erith to Dartford 
http://www.thisislocallondon.co.uk/news/15152772.Bexley_police_chase_stolen_JCB_digge
 
 University of West London students cook up a storm with Raymond Blanc 
http://www.thisislocallondon.co.uk/news/15153131.University_of_West_London_students_cook_up_a_storm_with_Raymond_Blanc/
 
 Enfield murder: Trio sentenced for 'intimidating' witness on Twitter 
http://www.thisislocallondon.co.uk/news/15152954.Trio_sentenced_for___39_intimidating__39__murder_trial_witness_on_Twitte
 
 Night Tube drivers vote for strike action in job applications row 
http://www.thisislocallondon.co.uk/news/15154794.Night_Tube_drivers_vote_for_strike_action_in_job_applications_row/?ref=mr&lp=1
 
 Wanted: Man on run after sexually assaulting girl, 12, on Enfield bus 
http://www.guardian-series.co.uk/news/15154915.Wanted__Man_on_run_after_sexually_assaulting_girl__12__on_bus/
 
submitted by pi3dpip3r to Newsdumps [link] [comments]

Cryptocurrency Security Advertised On Nasdaq Involved in Massive Corruption: Swiss SA Bity, and evidence suggests along with with Slock.it and the Ethereum Foundation, used an exploit on the original Ethereum cryptocurrency to steal est. 50 million USD+

Ways to improve this document
  1. Improve reporting agency information
  2. Remove reporting agencies that are wrong, and do not have jurisdiction.
  3. Add email addresses of staff of reporting/tip agencies that are right juristiction.
  4. Make script to generate comma seperated list of email addresses in README.md

Exercise our legal rights, call for a full investigation

BOTH affected members of the community and others who are watching this massive financial crime happen, watching it actively hurting innocent people and tarnishing the reputation of all cryptocurrencies request an official investigation from our legal systems.

Who to report them to?

  1. Switzerland Fedpol who handles corruption with non-profits
  2. Switzerland Financial authorities that Bity SA is are registered with
  3. Local authorities who will contact and work with Swiss authorities
Switzerland will investigate
Switzerland is in the middle of a policy shift regarding financial crimes, while it was once considered a safe haven for financial crime, they are now actively taking action to crack down and they actively cooperate with legal international investigations so it is worth reporting to local investigations too. https://www.finma.ch/en/enforcement/national-and-international-cooperation/
Swiss public encouraged to report corruption
http://www.swissinfo.ch/eng/anonymous-tip-off_swiss-public-encouraged-to-report-corruption/41662770

What do I send?

I will be sending the letter at the bottom of this page, to the authorities, you can use this letter, but it is recommended that you read it, correct any errors you see, make changes, add details that were missed.

Swiss Financial & Cybercrime Authorities

Report to the three Swiss agencies.
Financial Market Supervisory Authority (FINMA)
FINMA issued a liscense to Bity SA. Laupenstrasse 27, 3003 Bern Phone +41 31 327 91 00, Fax +41 31 327 91 01
EMAIL: [email protected]
Email addresses of FINMA staff:
[email protected]
Email addresses of Federal Police staff:
[email protected]
[email protected]
[email protected]
[email protected]
--AND--
Report to Swiss Cybercrime Unit
https://www.cybercrime.admin.ch/kobik/en/home/meldeformulameldeformular.html
--AND--

Swiss Federal Office of Police

Swiss Federal office of police actively encourages people to report corruption. They have built a special hotline, corruption they want reported includes:
"non-profit organisations (such as associations or foundations) in order to gain an unjustifiable material or immaterial advantage."
Report to Swiss Federal Police https://fedpol.integrityplatform.org/index.php?action=reportIncident&type=report
Evidence that Ethereum has been abusing their non-profit to protect DAO assets, using Ethereum resources to promote the DAO, ignoring their mission of decentralization when unilaterally deciding to hard-fork, using the knowledge they will hard fork to trade on insider knowledge and colluding to lower the market value of other cryptocurrencies.
I will be sending the letter at the bottom of this page, to the authorities, you can use this letter, but it is recommended that you read it, correct any errors you see, make changes, add details that were missed.
Sources:
Price manipulation using Ethereum Foundation resources for material gain
Chat logs from leaked Ethereum Foundation chat log indicating they were colluding to control the price of competing cryptocurrency
Source: https://imgur.com/a/DHexx#4I1WrPY
Failing stated mission, then using insider knowledge from internal chats to trade
Despite operating a Swiss non-profit with money raised by the community for the "mission to promote and support research, development and education to bring decentralized protocols"
They instead made all the decisions centrally, in internal chats, promoted security/assets that Ethereum Foundation members owned, built on Ethereum using their non-profit.
Chat log between Ethereum Foundation and Exchange Operators
Source: http://pastebin.com/raw/aMKwQcHR
Pull request stating that decision to implement the hard fork in the client used by roughly 95%+ would be defaulting to the option that benefited them the most financially.
"default behavior of Geth to be pro-fork as per internal discussions"
Source: https://github.com/ethereum/go-ethereum/pull/2814
They used insider knowledge about the fork to trade
"@junseth I will provide my opinion in the way that @Truthcoin would approve of: I have been buying DAO tokens since the security news"
Source: https://twitter.com/VitalikButerin/status/741832934814949377
Foundation member telling people when and when not to buy securities they had invested in
"We are doing a white hat attack. More news to follow. Do not panic. Do not sell." https://np.reddit.com/TheDao/comments/4p60ie/we_are_doing_a_white_hat_attack_more_news_to/
Involvement in the "White Hat Group"/"Robin Hood Group" hack that were then sold to support a cryptocurrency they created and started supporting, which they had a history of doing as seen in the Skype chat
"Bit more info: this isn't spur of the moment. A lot of people have worked around the clock for several days now to prepare for this. The community (individuals from the eth foundation, devs, security experts, ethcore, slock, etc) all came together to organize a response, which is currently ongoing." Source: https://www.reddit.com/TheDao/comments/4p60ie/we_are_doing_a_white_hat_attack_more_news_to/
Alex Van De Sande, or avsa on reddit and twitter, of the Swiss non-profit The Ethereum foundation is now denying any responsibility, or association, likely because of the legal fallout of recent events. But Alex was clearly involved with organizing the white hat group clearly was involved with organizing. He was seen organizing on reddit.com/ethereum as seen in the screen shot below. Source: https://d262ilb51hltx0.cloudfront.net/max/800/1*bY93URPw8UvehJXPcP2Qtg.jpeg
And more reddit posts with the titles
"We are doing a white hat attack on the DAO." by avsa. Source: https://www.reddit.com/ethereum/comments/4p5zk9/we_are_doing_a_white_hat_attack_on_the_dao/

Local Financial & Cybercrime Authorities

I will be sending the letter at the bottom of this page, to the authorities, you can use this letter, but it is recommended that you read it, correct any errors you see, make changes, add details that were missed.

Canadian Citizens

(1) Report fraud and financial crime directly to the Candian government http://www.cic.gc.ca/english/information/protection/fraud/report.asp
http://www.cic.gc.ca/english/information/representative/index.asp
CIC staff email addresses:
[email protected]
(2) Report to the anti fraud centre of Canada http://www.antifraudcentre-centreantifraude.ca/reportincident-signalerincident/index-eng.htm
(3) Report online crime to Vancouver police http://vancouver.ca/police/online-crime-reporting/fraud.html

US Citizens

(1) Important Report the crime to SEC who will contact and work with Swiss authorities https://denebleo.sec.gov/TCRExternal/disclaimer.xhtml
It is often better to get a list of direct email addresses to staff to get more immediate action because this crime is in progress.
SEC email addresses:
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
FINRA email addresses:
[email protected]
[email protected]
[email protected]
(2) Report directly to the FBI, it will get routed to IC3, cybercrime unit. https://tips.fbi.gov/
http://www.fbi.gov/contact-us/field/field-offices
http://www.fbi.gov/news/pressrel/press-releases/fbi-director-robert-s.-mueller-today-announced-the-inception-of-its-corporate-fraud-hotline
https://www.justice.gov/criminal-ccips/reporting-computer-internet-related-or-intellectual-property-crime#C4
FBI Corporate fraud hotline 888-622-0117
DOJ https://www.justice.gov/usao/eousa/contact
FBI email addresses:
DOJ email addresses:
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
(3) Individuals who suspect possible corporate fraud may report suspicious activity to the FBI in Washington, DC, via a toll-free Corporate Fraud Hotline. The number is (888) 622- 0117. The Hotline is manned Monday through Friday 9 a.m. to 5 p.m. by FBI analysts.
(4) Report online and computer crime to Federal Trade Commission. https://www.ftccomplaintassistant.gov/Information?OrgCode=#crnt&panel1-1
NASDAQ carried advertisements that appeared to be articles
[email protected]
[email protected]
News Organizations
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
Anti-corruption activist & NGOs
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
Misc
[email protected]
[email protected]

UK Citizens

(1) Report cybercrime and fraud to UK police http://www.actionfraud.police.uk/report-a-fraud/how-to-report-a-fraud
(2) Report crime to crimestoppers https://crimestoppers-uk.org/give-information/give-information-online/
(3) Specialist Crime OCU Fraud Squad Wellington House, 67-73 Buckingham Gate, London, SW1E 6BE +44 (0) 20 7230 1220 [email protected]
(4) Serious fraud office for complex fraud https://www.sfo.gov.uk/
News Organization
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
[email protected]
Serious Fraud Office email addresses:
[email protected]
(4) https://www.gov.uk/contact/govuk https://www.gov.uk/government/organisations/uk-trade-investment Department of Trade and Industry. 1 Victoria Street, London SW1H 0ET Tel: 0207 215 5000

Norway Citizens

Ministry of Foreign Affairs
https://www.regjeringen.no/en/dep/ud/id833/
MFA staff email addresses:
[email protected]
[email protected]

Australian Citizens

(1) Report crime to Australian Federal Police www.afp.gov.au/policing/cybercrime/crime-prevention.aspx
(2) Report to Australian crimestoppers https://www.crimestoppers.com.au/

New Zealand Citizens

(1) Report to your government http://www.dia.govt.nz/Censorship-Make-a-Complaint?OpenDocument

EU Citizens

(1) Europol connects law enforcement agencies in Europe https://www.europol.europa.eu/content/report-cybercrime

Swiss Citizens

(1) Report corruption, with corporations and non-profits https://fedpol.integrityplatform.org/index.php?action=reportIncident&type=report
(2) Report the incident to the cybercrime unit https://www.cybercrime.admin.ch/kobik/en/home/meldeformulameldeformular.html

International & United Nations

General information http://www.unicri.it/special_topics/securing_cyberspace/cyber_threats/internet_users/
(1) Report crime to interpol, special instructions for financial crime http://www.interpol.int/Contact-INTERPOL
(2) Report crime with international organizations to protect consumers https://www.econsumer.gov/#crnt

Who to report, the "White Hat Group":

Bity SA, fomerly SBEX SA Rue des Usines 44 2000 Neuchâtel Switzerland
  1. Alexis Roussel - Co-founder
  2. Gian Bochsler - Co-founder
  3. The Swiss non-profit Ethereum Foundation
  4. Alex De San
Slock.it GMBH [email protected] https://slock.it/ Schillerstr. Mittweida, Germany Company Registration: HRB 30026
  1. Stephan Tual - Founder & COO
  2. Christoph Jentzsch - Founder & CTO
  3. Simon Jentzsch - Founder & CEO
Swiss non-profit Ethereum Foundation (Stiftung Ethereum) Zug, Switzerland https://ethereum.org
  1. Vitalik Buterin
  2. Jeffrey Wilcke
  3. Fabian Vogelsteller
  4. Alex Van De Sande

Letter for authorities

I will be sending the letter at the bottom of this page, to the authorities, you can use this letter, but it is recommended that you read it, correct any errors you see, make changes, add details that were missed.
````

Format for Petition to Intervene by Electronic Copy (Email)

To: [email protected]
Cc:
Subject: Petition to Intervene & Investigate
Re: Ethereum Foundation, Slock.it GBMH, and Bity SA Petition to Intervene
To Whom May Concern:
[I/We] respectfully request to investigate and preferably intervene in the illegal seizure of 7,000,000 original Ether by Ethereum Foundation, Slock.it GBMH, and Bity SA. Who tried to coordinate a sell of the illegally obtained original Ether to coordinate crashing the price of the original Ethereum to convince users to adopt their new version of Ethereum that has features to enable the Ethereum Foundation to change any past transaction, stop smart contracts, allow third parties to replace the code of a smart contract.
Due to gross negligence of Ethereum Foundation, a non-profit promoting and trading a security created on their cryptocurrency Ethereum called DAO, collaborating with the swiss SA Bity and the German company Slock.it created a security contract and sold according to wikipedia 160,000,000 USD worth of the newly created security for the cryptocurrency Ether.
Source: https://en.wikipedia.org/wiki/List_of_highest_funded_crowdfunding_projects
After being informed by security researchers a bug in the contract had been found both Bity SA and Slock.it continued to promote the security, ignoring the risk.
If you look at the forum.daohub.org community you can clearly see, they see it as a security threads like "Is profit from DAO investment unlikely?"
The contract they created can be found here: https://daohub.org
Source: https://forum.daohub.org/t/is-profit-from-dao-investment-unlikely/1466 Source: https://blog.slock.it/no-dao-funds-at-risk-following-the-ethereum-smart-contract-recursive-call-bug-discovery-29f482d348b#.4geeq3dny
Statistical analysis was done on purchasers of the DAO security, using blockchain data.
It was determined "The wealthy few (top 1% of addresses) control over 55% of the voting power of proposals, while everyone who contributed 100 Ether or less (more than 66%) control barely over 2% of the total tokens."
Source: https://medium.com/the-bitcoin-podcast-blog/looking-at-the-dao-address-distribution-part-1-f324e71381bf#.ivoddhx3y
After the exploit was reported and disregarded by the operators an anonymous entity used the exploit to steal 1/3rd of the cryptocurrency that was used to buy the security. Worth est. 50,000,000 USD worth of Ether at the time.
After the exploit was used, Vitalik Buterin, the leader of the Ethereum Foundation, trying to encourage buying said "@junseth I will provide my opinion in the way that @Truthcoin would approve of: I have been buying DAO tokens since the security news" Source: https://twitter.com/VitalikButerin/status/741832934814949377
Anyone with knowledge in finance would immediately ask, why is the leader of a project that just had 50 million dollars worth of securities stolen, continue to buy those securities? The answer is because Vitalik Buterin had not yet announced it, but had already unilaterally decided that they would be creating a hard fork, essentially creating a new version of the Ether cryptocurrency and modifying the contract to stop it, and replace it with different code. The original Ether would still exist, but they would start a new one alongside it.
Invalidating the claim on their website that Ethereum:
"Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference."
Source: https://ethereum.org/
Despite pretending this decision was made by the community, the entire decision process was centralized to the Ethereum Foundation internal private chats.
Later it would come out with chat logs between the exchange operators after the event and even more later in pull requests from the Foundation that internal chats had decided the entire thing long before it was announced. So when Vitalik Buterin was buying DAO tokens, he had already known he would soft or hard, regardless of the stakeholders. Chat log between Ethereum Foundation and Exchange Operators
You can validate the authenticity of this chat log easily by talking to the exchange operators, they operate: http://kraken.com , http://poloniex.com, http://bitfinex.com http://yubi.com
Source: http://pastebin.com/raw/aMKwQcHR
Comments on code published clearly state that decision to implement the hard fork in the client used by roughly 95%+ would be defaulting to the option that benefited them the most financially. The deciding factor it would be implemented because the majority of users do not even know how to change the setting.
"default behavior of Geth to be pro-fork as per internal discussions" Source: https://github.com/ethereum/go-ethereum/pull/2814
While they implemented this they started a back up plan where the Ethereum Foundation, Slock.it GBMH and Bity SA worked anonymously as a hacking group named "The White Hat Group" or "Robin Hood Group" (WHG or RHG). They captured 2/3rd of the Ether that was in the DAO security using the same exploit the original exploiter did.
This plays a very important part later but because there was a fork, advertising efforts were made to brand the new copy of Ethereum with changes to one contract as the real Ether while many people continued to use the same Ether The Ethereum Foundation had sold them in the crowdsale.
The speculated reason for breaking their system, creating an entire new one is due the massive loss taken by the 1% of DAO owners.
The Ethereum Foundation actively promoted the DAO security on their blog, the inventors of Ethereum both Gavin Wood and Vitalik Buterin became "curators", claiming they would check every contract for errors making sure the DAO was secure.The Ethereum Foundation having pitched sales of the DAO to wealthy investors from the financial sector had to answer to them when the contract they were supposed to check, failed. Knowing they would lose all their instituational investment from the Financial industry they created a new Ethereum that was fundamentally different than Ethereum.
Some people in the Ethereum community began to call this new version Ethereum hard fork, or ETF. This new ETF Ethereum had features that allowed the developers to change old transactions, stop applications, and allowed third parties (them) to arbitrary change out the code in a contract.
This made ETF distinctly different than the Ethereum that much of the community continued using that they originally received directly from the Ethereum Foundation during the crowdsale. It did not match any of the advertising about unstoppable applications, but the original Ethereum didn't have all these new features that changed it into essentially the opposite of the description of Ethereum. So people wanting unstoppable applications, with no third party interference and censorship resistence just kept using Ethereum, trading it and building with it.
Then the Ethereum Foundation, Slock.it GMBH and Bity SA used the exploit used by the hacker that led to the hard fork to get control of the 7,000,000 Ether they wrestled from the hacker before the fork. Without telling anyone they begin to launder the money. They did this by splitting the amount into smaller amounts and sending it to random addresses they created before sending it to the markets.
But because it was done poorly it was quickly determined where it was going, to currency exchanges to be sold.
Source: https://imgur.com/a/9X1Ce#MFyQd1e
Before some exchanges managed to freeze their accounts, they had successfully sold off large amounts of the stolen ETH to buy a new asset/security that was recently created, which they hold significant portion of total security/token.
Source: http://i.imgur.com/CBRclaF.jpg
The "White Hat Group" moved large amounts of the original Ether to exchanges and coordinated a mass sell trying to crash the price. The goal was to crash the price and convince people still using the original Ethereum that they had no choice.
Leaked Skype chat logs from the private Ethereum Foundation internal chat were leaked showing they were in fact colluding to control the price and force the community to follow the decision they unilaterly made. If all the chat logs could be obtained from Skype it would be very clear to what extent the collusion and illegal usage of the Ethereum Foundation.
In the private chat of the supposedly non-profit Ethereum Foudnation Skype channel, they are seen colluding control the price of the competing original Ethereum.
Chat logs from leaked Ethereum Foundation chat log indicating they were colluding to control the price of competing the original Ethereum.
Source: https://imgur.com/a/DHexx#4I1WrPY
In the chat logs, Jeffrey Wilcke and Fabian Vogelsteller can both be seen discussing ways to use the resources of the non-profit Ethereum Foundation to control the price of the original Ethereum and the new Ethereum. Owning significant amounts of the new Ethereum.
This is not an isolated incident of Ethereum Foundation using their insider knowledge from operating the non-profit to make purchasing decisions. Vitalik Buterin of the Ethereum Foundation, shortly after the hack but before he announced there would be a hard fork announced he was buying DAO security/tokens on Twitter.
This is the exact opposite of decentralized governance, depsite operating as a Swiss non-profit with money raised by the community crowd sale for the "mission to promote and support research, development and education to bring decentralized protocols".
Source: http://ethereum.org
There are likely more crimes actively happening but we only know of this because the currency exchange operators froze some of the "White Hat Group" accounts due to suspicious activity. This forced the "White Hat Group" to reveal themselves. It would be best to talk to Kraken.com and Poloneix.com, both exchanges who froze assets of the "White Hat Group" members after their attempts to launder and sell the cryptocurrency.
Ursium on reddit is Slock.it COO Stephan Tual creator of "The DAO" security, who originally designed with the intention to fund his businesses including Slock.it. Clearly named Ethereum Foundation devs as the first people on the list of the "White Hat Group" and included his own company Slock.it. Notice the ordering, the Ethereum Foundation is the first one listed when talking about the "White Hat Group".
"Bit more info: this isn't spur of the moment. A lot of people have worked around the clock for several days now to prepare for this. The community (individuals from the eth foundation, devs, security experts, ethcore, slock, etc) all came together to organize a response, which is currently ongoing."
Source: https://www.reddit.com/TheDao/comments/4p60ie/we_are_doing_a_white_hat_attack_more_news_to/
Alex Van De Sande, or avsa on reddit and twitter, of the Swiss non-profit The Ethereum foundation is now denying any responsibility, or association, likely because of the legal fallout of recent events. But Alex was clearly involved with organizing the white hat group clearly was involved with organizing.
He was seen organizing on reddit.com/ethereum as seen in the screen shot below.
Source: https://d262ilb51hltx0.cloudfront.net/max/800/1*bY93URPw8UvehJXPcP2Qtg.jpeg
And more reddit posts with the titles "We are doing a white hat attack on the DAO." by avsa.
Source: https://www.reddit.com/ethereum/comments/4p5zk9/we_are_doing_a_white_hat_attack_on_the_dao/
Alex of the Swiss non-profit the Ethereum foundation even goes further on reddit, tell people specifically to not to sell the DAO security they had previously promoted heavily on the Ethereum Foundation blog. Stating is actively being hacked by them. We here could mean presumably the "White Hat Group" or the Ethereum Foundation.
"We are doing a white hat attack. More news to follow. Do not panic. Do not sell."
https://np.reddit.com/TheDao/comments/4p60ie/we_are_doing_a_white_hat_attack_more_news_to/
He was seen organizing on twitter.com, claiming it was "our white hat counter attack", presumably he means the "White Hat Group" but the Ethereum Foundation. And from twitter he stated during the first use of the exploit by the "White Hat Group", clearly having insider knowledge by being in the internal private Ethereum Foundation chat.
"alex van de sande ‏@avsa Jun 21 DAO IS BEING SECURELY DRAINED. DO NOT PANIC."
"alex van de sande ‏@avsa Jun 21 I repeat. There was an attack on the DAO so we launched our white hat counter attack. More updates will follow" (Emphasis is mine on 'our')
What is clear by all this that the recent claims that Alex Van De Sande has nothing to do with the "White Hat Group" is an obviously lie.
While there is no evidence he was active participant in the laundering or selling of the original Ether cryptocurrency for the new version in collaboration Bity SA is not clear.
What is claer, is there is evidence from a leaked Ethereum Foundation skype chat that they were actively t rying to manipulate the price of the original Ethereum cryptocurrency to force investors to buy the new Ethereum they promoted. This original Ethereum cryptocurrency never stopped being used by its community, even if the Ethereum Foundation actively tried to manipulate pulbic opinion. The exact same cryptocurrency they told exchanges was worthless, was being traded for almost 2 USD per coin. This was also the exact same cryptocurrency they worked with Bity SA and Slock.it GMBH to steal millions of USD worth and dump on the market.
The primary purpose of the blockchain which cryptocurrencies are built on is to prevent modificaiton of past transactions to prevent double spending. The Ethereum Foundation added the ability to modify past transactions, to stop applications and allow third party interference so they could replace the DAO code. In doing that they no longer were working on Ethereum, and Ethereum never stopped being used or valued even if they did not want it to. They got upset and then commited theft, fraud to manipulate the markets and force their centralized unilateral decision on the whole community.
The Ethereum Foundation lied to exchanges, telling them no one is still using the original Ethereum network, despite massive arguments in the Ethereum forum ongoing for a month, where many people said they wanted to 'stay on the original Ethereum. One person even wrote a manifesto, convincing others that staying is the only way for Ethereum, the one they were advertised and bought in the crowd sale, could continue existing.
Please start an investigation, please stop these three organizations from operating a corrupt system where they take no risks, because they can rewrite history, where they get to decide for everyone which one is "real" even if others are actively using, trading and programming the original Ethereum all along.
Using an exploit to illegally seize the securities they created on the cryptocurrency Ethereum is theft.
We are sending this request to you, with copies to the SEC’s distribution list for this proceeding as noted in the “cc” below.
[My/Our] particular rights, duties, privileges, immunities or other substantial interests that may be affected if the SEC does not act immediately, start an investigation and work with Swiss Federal Police.
Swiss Federal office of police actively encourages people to report corruption. They have built a special hotline, corruption they want reported includes:
"non-profit organisations (such as associations or foundations) in order to gain an unjustifiable material or immaterial advantage."
Report to Swiss Federal Police https://fedpol.integrityplatform.org/index.php?action=reportIncident&type=report
Evidence that Ethereum has been abusing their non-profit for unjustifiable advantage is more than clear, as they commit massive crimes hoping the system is too complex for them to ever be investigated.
Information on organization and related members:
Bity SA, fomerly SBEX SA Rue des Usines 44 2000 Neuchâtel Switzerland
Alexis Roussel - Co-founder SBEX SA, Co-Founder Bity SA Gian Bochsler -Co-founder SBEX SA, Co-Founder Bity SA 
Slock.it GMBH [email protected] https://slock.it/ Schillerstr. Mittweida, Germany Company Registration: HRB 30026
Stephan Tual Founder & COO Christoph Jentzsch Founder & CTO Simon Jentzsch Founder & CEO 
Ethereum Foundation (Stiftung Ethereum) Zug, Switzerland https://ethereum.org
Vitalik Buterin Jeffrey Wilcke Fabian Vogelsteller Alex Van De Sande 
[Text of your petition.] Thank you for your consideration, of this petition. Sincerely, [Your name/s]
[Attachments, if any, e.g., map, photo, etc.]
````
If you agree and feel this warrants at the very least a possible criminal investigation, you should report it.

Citations

  1. https://medium.com/the-bitcoin-podcast-blog/looking-at-the-dao-address-distribution-part-1-f324e71381bf#.ivoddhx3y
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