UK economy struggles as inflations continue to bite hard

UK economy struggles as inflations continue to bite hard

Key Points

  • UK’s Gross Domestic Product has shown no growth in Q3 2023 after registering a slight rise of 0.2% in Q2.
  • The UK Finance Minister now decries high inflation, blaming it as the “greatest barrier” to their economic growth.

Inflation rates in the UK are still running wild and have halted economic growth in Q3 2023. The country had a flatlined GDP in the quarter per initial figures revealed on Nov. 10.

UK GDP flatlines in Q3 2023

There was no quarterly growth in the past three months ending September in the UK despite Q2 showing a slight increase of 0.2%. While inflation rates remain higher in the country, it’s still not as tight as it was in the previous year.

The UK Q3 GDP is 0.6% higher than what was recorded in 2022, but there is still more to be done for the economy to experience a near-full recovery. The Finance Minister Jeremy Hunt said that inflation remains the “single greatest barrier to economic growth” in the country, with the Consumer Price Index showing 6.7% YoY in September.

Hunt continued:

“The best way to sustainably grow our economy right now is to stick to our plan and knock inflation on its head.”

He added that their Autumn Statement would focus on how they can get the economy growing healthily again by unlocking investments and getting people to work by reforming public services to allow them to deliver the growth that the country needs.

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European stocks fall as investors track Middle East political atmosphere

European stocks fall as investors track Middle East political atmosphere

Key Points

  • Tension in the European market rises as investors fear further escalation in the Middle East.
  • Pan-European Stoxx 600 index down 0.6% as President Biden tours Tel Aviv

European stocks are trading in the red as President Biden visits Tel Aviv. Investors are now wary of possible war escalation in the Middle East as Israel has requested aid from the US, and President Biden has visited in a show of solidarity.

European stocks still dipping despite President Biden’s visit to Tel Aviv

Eurozone stocks have been affected by political and economic atmospheres in the region, with the markets opening lower. Investors are digesting key corporate earnings, inflation data, and developments in the war in the Middle East.

The pan-European Stoxx 600 index was down 0.6% at noon in London, with the Tech sector dipping by 1.4% and the Energy sector rising by 0.7%. Investors have also been alarmed by a lower-than-expected reporting from the Shares of European semiconductor manufacturers. Dutch chipmaker ASML posted lower-than-expected orders, indicating that 2024 would post flat sales. 

The semiconductor industry has been a major concern in the US and the EU as the two entities seek to abandon China as a partner in trading tech products in their latest economic resolutions. The US urged the EU to reduce over-reliance on China’s tech sector products earlier in the year. However, they cannot still decouple from the Asian economic behemoth completely.

Today, President Biden landed in Tel Aviv to show solidarity with Israel in their fight with Palestine over the Gaza Strip. This geopolitical act is expected to have a considerable economic effect. China, Russia, UAE, and other nations have souring business ties with the EU, and the US supports Palestine. However, it is still yet to be seen if the two nations will agree on a ceasefire or if shelling will continue.

Brazil to add crypto to debtor’s protected list

Brazil to add crypto to debtor’s protected list

  • Brazilian lawmakers are working on a law that could see crypto enter the debtor’s protected assets list.
  • This means that significant crypto holdings might start being protected from seizures on behalf of creditors in the country.

Brazilian lawmakers are discussing a motion that seeks to grant strong protection to significant crypto savings as part of a bill to protect the savings assets of debtors.

Crypto may become part of debtors’ personal savings category protected from seizures in Brazil

Bill 4.420/2021, Written by Deputy Carlos Bezerra, has been tabled to the committee on the Constitution, Justice and Citizenship in the Chamber of Deputies of the National Congress of Brazil, seeking to amend the Code of Civil Procedure of 2015 to protect private savings of debtors equals to 40 minimum wages from potential seizure on behalf of their creditors.

The bill’s initial version did not include crypto assets but has now been rewritten to include tokenized assets as well. This discussion is a landmark in the crypto industry as governments are increasing their efforts to streamline the adoption and usage of these assets worldwide.

The new version of the bill refers to digital assets as

“Digital representations of value that can be traded or transferred via electronic means and used for making payments or investments.”

This legal development is not a set-apart event. In August, the Brazilian Congressional Committee approved amendments to a bill that seeks to raise taxes on crypto assets held overseas. Keep watching Fintech Express for more updates on crypto and other FinTech-related developments.

Meta reportedly working on an AI project to rival OpenAI

Meta reportedly working on an AI project to rival OpenAI

Key Points

  • Mark Zuckerberg’s Meta is reportedly working on an AI project that is meant to rival OpenAI’s ChatGPT
  • Wall Street Journal Exclusive story indicates that Meta is in very advanced stages of AI chatbot development

Meta has been on the spot before for training its AI with licensed artwork, and reports leaked that it was working on an AI chatbot. A Wall Street Journal exclusive story now indicates that its AI project will rival OpenAI.

Meta’s AI conversation continues.

Meta, the parent company to multiple social media platforms, WhatsApp, Facebook, Instagram, and Threads, has indicated that it is working on the world’s most powerful artificial intelligence project. 

This project is meant to rival OpenAI’s ChatGPT models, with sources close to the company saying it aims to have its AI (Llama) be “several times” more powerful than its earlier version, the Llama 2 model released earlier this year.

Meta has been building data centers necessary for developing such a project, acquiring respectable numbers of Nvidia’s H100 semiconductor chips- the most powerful and highly coveted ones on the market. Wall Street Journal’s sources expect that the company will make the AI project open, allowing other companies to learn from its code and produce similar high-level models.

Llama was trained on over 70 billion parameters, making it one of the most potent AI projects. However, OpenAI’s ChatGPT 4 was reportedly trained on over 1.5 trillion parameters, though official numbers are yet to be released. 

At the same time, the claims of Meta having a rival Llama model remains to be certified as no official communication is out yet. Keep watching Fintech Express for updates on this and other tech-related developments.

BlockFi argues FTX and Three Arrows Capital aren’t victims in the repayment case

BlockFi argues FTX and Three Arrows Capital aren’t victims in the repayment case

Key Points

  • Bankrupt crypto lender BlockFi is working on blocking FTX and 3AC from retrieving millions in loan payback.
  • FTX and 3AC had lent money to BlockFi but underwent bankruptcy in 2022, necessitating the payback of loans given to the crypto lender.

In an August 21 filing in a New Jersey Bankruptcy Court, BlockFi claimed that its creditors should not be pushed as FTX’s creditors were harmed by the exchange’s misappropriation of $5 billion that BlockFi had lent it. It also added that bankrupt crypto hedge fund 3AC committed fraud with the money lent and thus should not be entitled to a potential repayment.

BlockFi tries to block 3AC and FTX from retrieving millions in payback 

BlockFi, FTX, and 3AC were some of the largest crypto fraud and bankruptcy cases ever seen in the industry’s history. They “coincidentally” happened in the same year and conspicuously had ties to each other.

As such, there have been multiple tussles between these organizations as they try to repay their dues to creditors and refund users’ money simultaneously. BlockFi, a bankrupt crypto lender, has been pushing for long that FTX and 3AC not get paid from its liquidations as they may have misappropriated the money it lent.

Estimates show that BlockFi owes around $ 10 billion to over 100K creditors and $! Billion to three of its largest ones. In the mix of freditors comes 3AC and FTX. It owes 3AC about $220 million and FTX around $400 million. FTX and 3AC have been pushing to get these hundreds of millions back as they would make it much easier to repay their creditors.

However, a recent Court filing shows that BlockFi feels the two creditors are the real victims in the case. An excerpt from the filing reads:

“FTX seeks to recover on over $5 billion of claims filed against the BlockFi estates at the direct expense of the ultimate victims of FTX’s fraud: BlockFi’s clients and other legitimate creditors.”

“To prevent further injustice to the creditors of BlockFi’s estates, the Court should disallow the FTX claims under the doctrine of unclean hands,” BlockFi added.

BlockFi further indicates that the $400 million FTX gave wasn’t a standard loan as it was under an agreement to have a five-year term that would not activate until the firm supposedly matures. As such, BlockFi feels that it should be treated as a “gamble” for which it should not be liable.

Despite the ongoing skirmishes, creditors recently settled with BlockFi in July to proceed with the set repayment plan. However, it is still yet to be seen if it will work out as 3AC and FTX’s $1 billion loans would significantly affect its creditors’ payout. Keep watching Fintech Express for updates on this and other fintech-related developments.