is back above $50,000 for the first time since May. Crypto bulls have naturally celebrated the milestone, and there is optimism the world’s largest cryptocurrency could climb to fresh all-time highs and beyond.
A word of caution, though. The coin’s path so far this year is a stark reminder, if one was needed, of Bitcoin’s crazy volatility.
After climbing from $30,000 to its April peak of nearly $65,000 in just over three months, Bitcoin lost more than half of its value over the next three months. The rebound from below $30,000 to $50,000 has taken just over a month.
A volley of bad news was behind Bitcoin’s collapse: China’s crypto crackdown, other regulatory pressures and environmental concerns. Those problems have not gone away, at all—The Wall Street Journal this weekend profiled the great “mining migration” by crypto miners to relocate outside of China. But sentiment has shifted rapidly, helped by bullish comments from high-profile backers including
CEO Elon Musk,
CEO Jack Dorsey and ARK Invest CEO Cathie Wood as well as the increased adoption of Bitcoin worldwide.
Securities and Exchange Commission Chairman Gary Gensler’s comments signaling the potential pathway for Bitcoin ETFs, albeit under strict rules, is another key factor. PayPal’s decision on Sunday to launch its cryptocurrency service in the U.K., the first country outside the U.S., is just the latest piece of good news boosting momentum.
***On this week’s Barron’s Streetwise podcast, columnist Jack Hough tackles listener questions, including whether investing has fundamentally changed. Listen here.
U.S. Enrolls Private Airlines to Help in Kabul Evacuation
The U.S. government Sunday requisitioned aircraft from six commercial airlines to help evacuate people from Afghanistan, illustrating the challenges Washington is facing after the takeover of the country by Taliban forces.
The U.S. Department of Defense said that a total of 18 planes from
Delta Air Lines,
Omni Air, Hawaiian Airlines and
will help transport evacuees from transit airports or U.S. military bases, across the world, after they have been evacuated from Kabul.
- The commercial airplanes “will not fly into Hamid Karzai International Airport in Kabul,” the release said. They will help evacuate “U.S. citizens and personnel, Special Immigrant Visa applicants, and other at-risk individuals” from Afghanistan.
- President Joe Biden, said in an address from the White House Sunday afternoon, that the airlines had voluntarily signed up for the so-called Civil Reserve Air Fleet program, mirroring the Berlin Airlift after World War II.
What’s Next: The Pentagon said it didn’t “anticipate a major impact” to the private airlines from the order, which marks the third time the CRAF has been activated, after being used in 1990/1991 and 2002/2003 during the first and second Iraqi wars.
House Democrats Remain Divided Over Infrastructure Vote
Nine centrist Democrat Representatives remain in a standoff with House Speaker Nancy Pelosi over when to vote on the roughly $1 trillion infrastructure bill, threatening her plans to pass it in tandem with a $3.5 trillion budget framework.
- The House of Representatives returns to Washington, D.C., Monday. The group of nine urged Pelosi to advance the two proposals separately and vote on the first bill immediately. “Let’s get a big win, restore America’s faith that despite our differences, we can actually get stuff done,” said Rep. Kurt Schrader (D., Ore.).
- Other Democrats, including Pelosi, are adamant that the House pushes both plans forward together with a vote on the larger package first. Doing so could increase pressure on centrist Democrats who have questioned the larger bill’s cost.
- Pelosi can lose no more than three Democrats in these votes. She warned Democrats Saturday night that “any delay to passing the budget resolution threatens the timetable for delivering the historic progress and the transformative vision that Democrats share,” The Wall Street Journal reported.
- The $3.5 trillion budget package would broaden the nation’s safety net through subsidized child care, paid family leave, expanding Medicare to cover dental, vision and hearing care, universal prekindergarten, free community college, and other measures.
What’s Next: Pelosi has scheduled a vote Monday night to procedurally advance both the infrastructure bill and the budget framework, saying in her letter that the House aims to enact both bills before Oct. 1.
—Janet H. Cho
What to Expect From the Fed’s Jackson Hole Meeting Later This Week
The Federal Reserve said it would convene virtually this week for its 2021 Economic Policy Symposium typically held in Jackson Hole. The Kansas City Fed cited the “recently elevated Covid-19 health risk level,” including a high risk of transmission in Teton County, Wyo. Dozens of central bankers, policy makers, and economists had planned to meet in person.
- The Fed’s decision to go online for the second straight year offers a real-time reflection of how officials see the economy’s largest wild card. Economists at Oxford Economics say their recovery tracker, a mashup of about two dozen indicators, has stalled as consumers become more cautious and overall mobility declines.
- Since the Federal Open Market Committee’s meeting last month, the July employment report showed a 943,000 jump in nonfarm payrolls, while the jobless rate dropped to 5.4%. But consumer sentiment, retail sales, and housing starts have all been weaker than expected.
- Fed Chairman Jerome Powell last Wednesday acknowledged the risk from the Delta variant and future mutations on the economy. “As long as Covid is running loose out there, as long as there’s time and space for the development of new strains, no one’s really finally safe,” he said.
- Powell will deliver his keynote address Friday at 10 a.m. Eastern. His speech will be live-streamed via the Kansas City Fed’s YouTube channel as well as Barron’s website.
What’s Next: Investors will watch Powell’s keynote for any update on the Fed’s plans to wind down the roughly $120 billion in monthly Treasury and mortgage-backed securities purchases it launched in response to the pandemic. Fed officials last month were split on when and how aggressively to begin reducing those purchases.
—Lisa Beilfuss and Janet H. Cho
FDA Expected to Give Pfizer and BioNTech’s Vaccine Full Approval Monday
The Food and Drug Administration could fully approve
Covid-19 vaccine this week, opening the door for more employers and universities to require vaccinations and potentially boosting vaccinations among people with misgivings about the safety of coronavirus vaccines.
- That full approval could come as early as today, as regulators worked to accelerate an unofficial timeline of approval around Labor Day, according to multiple news reports citing people familiar with the agency’s planning.
- It would mean that 1.3 million U.S. military members must get inoculated. Defense Secretary Lloyd Austin told troops earlier this month that they must get vaccinated by Sept. 15, or as soon as the FDA grants full approval of the vaccine, “whichever comes first.”
- The city of San Francisco has told its employees that as soon as the vaccines are fully authorized by the FDA, they must get inoculated or risk losing their jobs. About 750 U.S. colleges and universities are requiring vaccines of at least some students or employees.
- As of Sunday, 170.8 million Americans were fully vaccinated, 51.5% of the total population, per the Centers for Disease Control and Prevention. The U.S. reported 128,902 new coronavirus infections and 1,001 deaths on Saturday, according to Johns Hopkins University.
What’s Next: Once their vaccine gets full approval, Pfizer and BioNTech are planning to ask regulators to approve a third dose as a booster. Full approval would make the vaccine eligible for off-label prescriptions and allows the company to start marketing it to doctors, providers, and the public, The Wall Street Journal reported.
—Janet H. Cho
Undervalued U.K. Stocks in Focus After Apollo’s Mooted Bid for Grocer Sainsbury’s
Reports that the U.S. private-equity fund Apollo may be “running the rule” over
sent shares in Britain’s second-largest supermarket roaring more than 11% Monday. Apollo is already in a bid battle with a rival private-equity firm for control of
The Sunday Times reported that Apollo remains keen on the U.K. retail sector after having failed to take control of Asda, once owned by
earlier this year. For now its interest in Sainsbury’s was reported to be “exploratory.”
Shares of other U.K. retailers increased in the wake of Sainsbury’s Monday morning, with
Marks & Spencer
up about 2% in a U.K. market up 0.4% as measured by the
Apollo is for now focused on a battle for Morrisons, where it is eager to join a consortium of
Fortress group to wrestle control away from buyout fund Clayton Dubillier & Rice.
What’s Next: The U.K. stock market has massively underperformed European and U.S. markets both this year and over the last three years. Investors feeling the European and U.S. markets are now fully valued may be looking at U.K. equities with a fresh eye.
MarketWatch Wants to Hear From You
In this week’s Big Move column, a reader asks: ‘I’m 60 and I’m considering paying off the $250,000 mortgage on my home. I have $1 million in company stock and $1 million in my 401(k), and I plan to work until I’m 67, at which point I’ll receive a pension of $8,000 per month. Should I sell the company stock to pay off the house?’
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—Newsletter edited by Matt Bemer, Camilla Imperiali, Steve Goldstein, Rupert Steiner