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“Smart Money: How digital currencies will win the New Cold War - and why the West needs to act now”, the book Brunello Rosa has written with Casey Larsen for Bloomsbury Publishing, is available in all major bookshops since October 24th, 2024. The book was named among the Best Economics Books in 2024 by the Financial Times.
This book discusses the fundamental theme of the “geopolitics of central bank digital currencies” in a non-technical manner, and is aimed at the general public. It does not shy away from discussing their most controversial implications, including the risks to privacy, the stability of the banking system as we know it, or the re-organisation of the global financial architecture around these new instruments.
Go to the book's webpage on brunellorosa.com
In their latest podcast Brunello Rosa and Manas Chawla discuss the ongoing battle on LLMs between OpenAI, DeepSeek and Alibaba
7 February 2025
In their latest podcast Brunello Rosa and Manas Chawla discuss the main takeaways from the recent World Economic Forum in Davos.
31 January 2025
In their latest podcast Brunello Rosa and Manas Chawla discuss the beginning of the second term of Donald Trump at the White House
24 January 2025
In their latest podcast Brunello Rosa and Manas Chawla discuss the risk for the US to remain isolated at global level following Trump's bombastic statements.
17 January 2025
In their latest podcast Brunello Rosa and Manas Chawla discuss how Elon Musk is becoming a Steve Bannon 2.0.
10 January 2025
In their latest podcast Brunello Rosa and Manas Chawla discuss how 2024 was in fact a year lived dangerously in geopolitics and politics.
3 January 2025
In their latest podcast Brunello Rosa and Manas Chawla discuss how the world’s major central banks have changed their policy stance at year’s end
27 December 2024
In their latest podcast Brunello Rosa and Manas Chawla discuss how, after the US, Elon Musk is targets the UK’s political system
20 December 2024
In their latest podcast Brunello Rosa and Manas Chawla discuss the collapse of Assad's regime and what this means for the Middle East.
13 December 2024
In their latest podcast Brunello Rosa and Manas Chawla discuss how tech revolutions are set to separate money supply from state control.
6 December 2024
In their latest podcast Brunello Rosa and Manas Chawla discuss the "tech takeover" in the US, which will lead to the Musk (Trump) - Thiel (Vance) presidency.
29 November 2024
In their latest podcast Brunello Rosa and Manas Chawla discuss Trump's first appointments and likely policies
22 November 2024
In June 2023, Rosa & Roubini Associates has been recognised for the second consecutive year as the best independent macroeconomic research & advisory firm by Corporate Vision Magazine
R&R provides independent research on the global economy
R&R provides independent advice on global issues
by Brunello Rosa
10 February 2025
On January 23rd, the newly inaugurated US President Donald Trump signed, among other things, an executive order on Strengthening American Leadership in Digital Financial Technology. Some of the key provisions of the executive order, which revoked Biden’s previous executive order on Ensuring Responsible Development of Digital Assets, are: (1) a ban on developing a US-backed central bank digital currency; (2) a push to further strengthen the dominant position of the US in USD-based stablecoins and (3) the “potential creation and maintenance of a national digital asset stockpile,” which in the media is sometimes called the “Bitcoin Strategic Reserve”.
This push on cryptos provided by the new administration has two additional datapoints. First, on the eve of his own inauguration, Trump, and subsequently his wife Melania, launched his own meme-coin $Trump, the price of which jumped overnight from 18 cents to nearly 70 USD, before falling back. Disregarding for a moment the massive conflict of interests, there could hardly be a stronger signal that Trump could provide to the crypto industry than issuing his own “crypto-currency.” Subsequently, Trump Media and Technology Group Corp. (TMTG) announced its intention to launch new investment products, including a spot Bitcoin (BTC) exchange- traded fund (ETF), thus following giants such as Blackrock.
The second datapoint comes from an unexpected source – the Federal Reserve, and its own Chair Jay Powell. First, Powell said that Bitcoin, instead of being considered a substitute for the US dollar, should be considered a substitute for gold. Second, during his latest press conference following the January FOMC meeting, he also said that “banks are perfectly able to serve crypto customers, as long as they understand and can manage the risks and it’s safe, safe and soundness [... The Fed is] “not against innovation, and we certainly don’t want to, to take actions that would cause banks to, you know, to terminate customers who are perfectly legal just because of excess risk aversion maybe related to regulation and supervision.”
This is almost the polar opposite to what Christine Lagarde said at the end of the ECB Governing Council meeting in January, when she said that “there is a view around the table of the governing council, and most likely the General Council as well, that reserves have to be liquid, that reserves have to be secure, that they have to be safe, that they should not be plagued by the suspicion of money laundering or other criminal activities.”
All this is to say that, in coming months and possibly years, the institutional adoption of Bitcoin is set to increase, and this will surely support its value as well as of that of other crypto-assets, such as Ethereum and Solana, to name only a few. In Davos, the CEO of Bank of America said that his bank – as well as others, including JP Morgan – would be ready “to come in hard” on crypto transactions, as they have “hundreds of patents on blockchain” and the tech stack needed to do so.
The question is: will this last? When speaking not to Bitcoin sceptics, but to real crypto fanatics and investors, they will say that almost certainly a new “Crypto Winter” is inevitable, and it may not even be that far away. There is no need to be a crypto pessimist to make this prediction: it’s the story of this asset since its inception. The value may drop up to 30-70% from its peak, before recovering and surging to new highs that – if Bitcoin really were to replace gold as an investment asset – may be in the region of USD 700,000, according to John Pfeffer, a partner at UK-based Pfeffer Capital.
The question then becomes: will institutional adoption be able to cushion the fall in prices? Or will technological advancements (e.g. of quantum computing, able to break all current cryptography) make it harder? What will be the wider financial stability implications? If leverage will be added to the system (something that so far has not happened, but could occur with wider institutional adoption), are we going to experience a new Global Financial Crisis to the power of 10 in coming years? These are all questions that even the biggest crypto enthusiasts should ask themselves. It is certain that we will learn their answers in the coming years anyway.
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by Brunello Rosa and Nato Balavadze
13 February 2025
by Joel Crisetig
12 February 2025
by Lāsma Kokina
5 February 2025
by Brunello Rosa and Nato Balavadze
12 February 2025
by Gulf State Analytics
7 February 2025
Week: 10-17 February 2025
The Week Ahead: QoQ GDP Growth Rate To Stall In EZ And Contracts In UK; Headline Inflation Rate To Remain Steady in US
In the US, in January, headline inflation is expected to remain at 2.9% y-o-y. In January, retail sales are likely to show no growth (p: 0.4%).
In the EZ, in Q4, according to the second estimate, the economy is expected to stall q-o-q (p: 0.4%) and advance by 0.9% y-o-y (p: 0.9%). In December, IP is seen contracting by 0.5% m-o-m (p: 0.2%).
In the UK, in Q4, according to preliminary estimates, the GDP growth rate is expected to shrink by 0.1% q-o-q (p: 0.0%). In December, IP is likely to rise by 0.3% m-o-m (p: -0.4%). Manufacturing production is also seen increasing by 0.1% m-o-m (p: -0.3%).
The Quarter Ahead: Trump And Japanese PM Ishiba Meeting; Israel-Hamas Ceasefire Deal And Trump’s Plans
Trump-Ishiba Meeting. Japanese PM Shigeru Ishiba is optimistic Japan will avoid U.S. tariffs, citing Trump’s recognition of Japan’s investment and job creation. After meeting Trump, Ishiba noted Japan’s role but didn’t discuss auto tariffs. He believes Japan’s top investor status makes higher tariffs unlikely.
Trump’s plans for Gaza. Hamas freed three hostages as Israel released Palestinian prisoners and withdrew from the Netzarim Corridor, enabling displaced Gazans to return to widespread destruction. Meanwhile, Trump reiterated his vision of US control over Gaza after the conflict, despite contradictions from his administration. He claimed Israel would transfer Gaza to the US, with no American troops needed, and suggested Palestinian resettlement. The proposal has sparked international backlash.
Real Economy: US NFP Decelerated; EZ Headline Inflation Increased; PMIs Rose In UK And EZ And Fell In US; BOE Cut Rates
In the US, January NFPs increased by 143K (c: 170K; p: 307K), while the unemployment rate declined to 4.0% (c: 4.1%; p: 4.1%). In January, S&P Global Manufacturing PMI increased to 51.2 (c: 50.1; p: 479.4, while Services PMI edged down to 52.9 (c: 52.8; p: 56.8). Composite PMI declined to 52.7 (c: 52.4; p: 55.4).
In the EZ, in January, headline inflation rose to 2.5% y-o-y (c: 2.4%; p: 2.4%), whereas core inflation stood at 2.7% y-o-y (c: 2.6%; p: 2.7%). In January, HCOB Manufacturing PMI increased to 46.6 (c: 46.1; p: 45.1), while Services PMI declined marginally to 51.3 (c: 51.4; p: 51.6). Composite PMI increased to 50.2 (p: 49.6) as expected. In December, retail sales advanced by 1.9% y-o-y (p: 1.6%) as expected. Among the largest EZ economies, headline inflation rate rose to 1.5% y-o-y (p: 1.3%) in Italy;
In the UK, in January, S&P Global Manufacturing PMI increased to 48.3 (c: 48.2; p: 47), while Services PMI fell to 50.8 (c: 51.2; p: 51.1). Composite PMI rose to 50.6 (c: 50.8; p: 50.4).
BoE Cut Rates. In the UK, in February, the BoE cut its Bank Rate by 25 bps to 4.50% (p: 4.75%).
Financial Markets: Stock Prices Rose; US Stocks and Long-Term Yields Fell; Dollar And Oil Prices Declined, Gold Prices Increased
Market Drivers: Stocks ended the week lower amid tariff uncertainty. Markets fell sharply after Trump announced 25% tariffs on Mexico and Canada and 10% on China. However, stocks rebounded after he delayed tariffs on Mexico and Canada by 30 days. In contrast, Europe’s stocks rose, nearing record levels despite trade concerns.
Global Equities: Increased w-o-w (MSCI ACWI, +0.0%, to 869.44). The US S&P 500 index decreased (-0.2% w-o-w, to 6,025.99). In the EZ, share prices increased (Eurostoxx 50, +0.7% w-o-w, to 5,326.35). In EMs, equity edged up (MSCI EMs, +1.4%, to 1,108.48). Volatility stood at 17.35 (VIX S&P 500, 52w avg.: 15.6; 10y avg.: 18.8).
Fixed Income: w-o-w, the 10-year US Treasury yields fell (-5 bps to 4.49%). The 2-year US Treasury yields increased (+8 bps to 4.29%). The German 10-year bund yields edged down (-8 bp to 2.38%).
FX: w-o-w, the US Dollar Index decreased (DXY, -0.3%, to 108.04; EUR/USD -0.0%, to 1.03). In EMs, currencies are virtually unchanged (MSCI EM Currency Index, -0.0% w-o-w, to 1,741.98).
Commodities: w-o-w, oil prices decreased (Brent, -2.7% to 74.66 USD/b). Gold prices increased w-o-w (+1.9% to 2,887.60 USD/Oz).
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