Coinbase USD Bitcoin costs more than USDT BitcoinEver since USDC depegged, even BTC vs tether has depegged to a certain degree. Watch for a return to the norm. right now, BTC vs USD costs about $190 more than the Tether equivalent.
Once upon a time, there was a little girl named Lily who lived in a small town. One day, her parents told her that they were going on a trip to another dimension, where the money was different. They explained that in that country, the money was worth more than it was in their own dimension.
When they arrived in the other place, Lily noticed that bitcoin seemed to cost more than they did back home. Her parents explained that even though the prices were higher in the other place, it was because the money there was more stable and valuable than the money in their own world.
Lily was fascinated by this idea and asked her parents why the money in the other dimension was worth more. They explained that it was because the other place had a strong economy and many valuable resources, which made their money more valuable to people around the world.
As they went about their travels, Lily began to notice that things cost different amounts in different places, even within the same world. Her parents explained that this was because some places had more valuable resources than others, which made their money more valuable.
Lily learned that the value of money could change depending on where you were, and that it was important to understand the value of money in different places. She was grateful for the opportunity to travel and learn about these things, and she looked forward to exploring more of the world and its many currencies.
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Leveraged Loans | Corporate Risk Premium Crisis?Many of you may not be familiar with leveraged loans and the ETFs that have become available to investors through funds over the last few years, but they are important to understand in order to have an edge over the rest of the markets these days - whether that's traditional equities, commodities, derivatives or crypto - as wealth preservation will be a big theme during 2019/2020. Investors have been driven into leveraged loans and related products sharply since the Financial Crisis as a result of record low interest rates in developed markets caused by experimental monetary policy; investors have been desperate for yield! And so we have seen very low risk premium spreads between "risky" junk paper and "risk free" treasury paper as a result of distortions in the marketplace. This spread is currently in the single digits, but during the Financial Crisis - when credit flow started to freeze - the spread skyrocketed into the 40 point range! Treasuries have only room to go lower in the event of a credit crisis and so one can imagine that risky corporate paper will be the victim of such a scenario as companies no longer get access to cheap credit. This will put huge pressure on corporate yields, resulting in defaults and deeply discounted paper.
FYI: The Quantity Theory of Credit is my theoretical and empirical inclination.
Anyway, keep an eye on leveraged loans and the ETF carrying them. Due to the way these ETFs are held by funds they also carry significant redemption risks, which can cause a run on the funds that issue them and cause funds to panic sell to meet redemption requests from investors. I'm sure there are a few strategies one could devise to take advantage of such a scenario ;)