Welcome to BRC’s Breakdown.

The markets are yet to recover from the New Year hangover, with equity markets all over the world getting off to a slow start. Crypto stood as a notable outperformer with the highly anticipated approval for the Bitcoin Spot ETFs hanging on the horizon.

First, let’s see how the markets fared this week:

Here’s a preview of what we’ll cover:

• Macro: US Treasury Yields Increase, Crypto Outperforms

• Around The World: Strong US Employment

• Crypto: e-Rupee Surpasses One Million Transactions in a Day

• AI: Google to replace 30,000 humans with AI

Macro: Global Equity Markets Start The Year Sluggish, Treasury Yields Increase

Equity markets all over the world got off to a weak start in 2024. US Treasury yields increased – reversing some of their sharp declines during the second half of December – as markets reduced their expectations of the US Federal Reserve cutting rates soon and more frequently.

Among US stocks, tech stocks underperformed sharply while utilities stocks moved up.

Bitcoin and Ethereum stood out as outperformers during the week with markets pricing in an increased chance of approval for Bitcoin Spot ETFs from the US SEC.

Notably, this week marks the beginning of December quarter earnings releases from Indian as well as American bellwethers. The notable earnings we are looking out for are – Infosys, Citigroup, and JP Morgan.

Around The World: Strong US Employment

The strong US employment report on Friday pushed US Treasury yields lower as market participants reassessed their view on when and how much the US Federal Reserve will cut rates.

Total non-farm payroll employment increased by 216,000 in December, and the unemployment rate was unchanged at 3.7 percent, according to the U.S. Bureau of Labour Statistics.

Employment continued to trend up in government, health care, social assistance, and construction. The two sectors that saw a decline in jobs were – transportation and warehousing.

India's Digital Rupee Surpasses One Million Transactions in a Day

India's central bank digital currency, the digital rupee, achieved a significant milestone on December 27, 2023, with over a million transactions in a single day. This was aided by retail banks' employees who were encouraged to use the e-rupee for depositing funds and benefits.

The retail CBDC pilot, operational in more than 15 cities with over a dozen banks participating, commenced on December 1, 2022.

Notably, some government-owned and private banks, including HDFC Bank, Kotak Mahindra Bank, Axis Bank, Canara Bank, and IDFC First Bank, contributed to the milestone by depositing salaries and benefits into CBDC wallets.

To promote the CBDC wallet transactions, banks have advised staff to use the digital currency, aiming for 100% staff registration on the digital rupee app. Some banks even began crediting allowances directly to CBDC wallets, starting with the newspaper allowance.

The All India Union Bank Employees Association sees this as a positive step, stating that promoting CBDC use among employees is a strategy to increase overall transactions, aligning with the RBI and government's objectives.

Google to replace 30,000 humans with AI

Google is reportedly considering laying off up to 30,000 employees as part of a company-wide restructuring. This decision comes as Google aims to streamline operations by integrating AI tools and processes for increased efficiency.

These potential layoffs follow a prior cut of 12,000 jobs last year. The broader adoption of AI within Google is set to transform ad sales and customer service roles, utilizing automation to minimize the need for human positions.

This development highlights Google's internal shift towards AI implementation, showcasing how the technology is reshaping various facets of the company.

Could this be the trend for 2024?

Interesting Reads

Driving with the Rear-View Mirror - Will we see a repeat of the past decade of U.S. equity returns?

As we start the year and make decisions on asset allocations, it’s important to keep in mind that past performance should be one factor but not the only or most significant factor driving our decisions.

Read it here.

Are You Wealthy?

After a strong year for crypto and Indian equity markets - this post on X (Twitter) reflects on what is wealth.

Read it here.

Ten Economic Questions for 2024

What matters for US Economy and by extension will drive global economy & crypto.

Read it here.

Podcast: Erik Serrano - Investing in Investment Firms

Invest Like The Best

Listen to it here.

Top Headlines Of The Week

• Bitcoin’s first wallet receives $1.17M in surprise transaction

• VanEck pledges 5% of spot Bitcoin ETF profits to core devs

• Final Bitcoin ETF Application Filings Get Posted by Major U.S. Exchanges