Welcome to our #82 weekly newsletter.
“For women taking control of their financial future”
-Jana Hlistova
From The Purse
In this week’s newsletter, we focus on a recent survey by CNBC and Acorn: Invest in You: Next Gen Investor, which has highlighted an age old problem: women invest less than men, although this is changing. We spotlight women investing in crypto and why black women in particular are still being left out.
And according to US investor Bill Gross, ‘bonds are trash’. This is very much in line with what US hedge fund billionaire, Ray Dalio said back in June. We explain why this is and what is likely to change.
You can review the news in brief so you stay on top of global financial, economic and investing trends.
Don’t forget to listen to The Purse Podcast interview with Judy Piatkus. We talk about how she built a global publishing brand, self-funding through growth, women’s relationship with money, angel investing, investing in women and conscious leadership.
I hope you enjoy this week’s newsletter.
Until next week,
Jana
Crypto: how women invest
What does the recent data suggest about how women invest?
Data is generally lacking about how women invest (across all ethnicities). However, in recent months, we have seen more surveys and reports regarding women investors and women investing in crypto.
And a recent survey (US) by CNBC and Acorn: Invest in You: Next Gen Investor has highlighted an age old problem: women invest less than men (although this is changing).
The survey found the following gender disparity in the ownership of assets:
cryptocurrency (16% of men vs. 7% of women)
exchange-traded funds (14% of men vs. 7% of women)
individual stocks (40% of men vs. 24% of women)
mutual funds (30% of men vs. 20% of women)
real estate (36% of men vs. 30% of women)
bonds (14% of men vs. 11% of women)
However, research published earlier this year…
…by Gemini (UK) suggests that investing in crypto is becoming more diverse, and specifically women are engaging as investors.
Out of the 13.5% of 2,000 respondents that are current or previous cryptocurrency investor, 41.6% were women. This represents a significant shift where women made up just 21%–22% of crypto investors.
And even though only 15% of Bitcoin traders are women, this is up from 10% last year.
In an interview, Gretchen Howard, the Chief Operating Officer of Robinhood (US investment platform), said that she has seen significant growth in the number of women customers in the last 2 years. This is a 369% increase year-on-year.
And, wait for it..
…the platform reported in March that 40% of its active female customers were trading crypto, a seven-fold increase over 2020.
But black women investors are being left out
Historically, black women have been excluded or marginalised by the financial services industry. And they have struggled with higher levels of student and personal debt.
Overall, black and hispanic women invest less than white women.
And according to the same CNBC and Acorn survey, just 4% of black women invest in crypto compared to 19% of white women.
This means that women, and especially black and hispanic women continue to miss out on a golden opportunity: to learn about ‘new money’, grow their net worth and build financial resilience.
What next?
Listen to the podcast with Diana Biggs about bitcoin, ethereum and DeFi.
Listen to the podcast with Marina Spindler about her report on ‘Women in Crypto’.
Read about crypto investment platforms (such as Coinbase or Kraken) and how to open an account.
Start small and start learning about the crypto market.
News in Brief
Financial news
Delta variant knocks US consumer confidence to six-month low. Concerns arise over the pandemic and rising prices undermine the economic recovery.
US job creation totalled 235,000 payrolls in August vs the median estimate of 733,000 added jobs. US job growth is slowing sharply due to the Delta wave and reviving economic restrictions.
Eurozone inflation hits 10 year high (eg Germany is at 3.4% in August). This figure will be confirmed in a few weeks time. The European Central Bank (ECB), due to meet Sept. 9, is also expected to discuss the future of its asset purchase program.
European stocks extend winning streak into seventh month. The index has surged by 18% so far this year, as the economic rebound, stimulus plans and ultra-loose monetary policy all boost shares.
The FTSE 100 index gained around 1.25% during August, bouncing back after a small decline in July. The UK’s blue-chip stock index has recorded its best month since April.
UK Chancellor, Rishi Sunak Rishi Sunak is set to scrap the so-called triple lock on annual increases to the U.K. state pension as soon as next week.
Crypto: bitcoin, ethereum & DeFi
Bitcoin rose above $51,000 (Bitcoin is currently trading at circa $49.9K).
Ethereum price spikes to 3-month high above $4,000. (Ethereum is currently trading at $3.8K)
Solana's native sol token hit an all-time high of $150.6. Solana is the seventh largest cryptocurrency by market capitalisation and has now eclipsed Dogecoin’s market cap.
Bitcoin miners brought in approximately $1.41bn in August (below the all-time peak of $1.75bn in March). This represents a month-over-month increase approximately 45% from July's $971.83m.
Twitter could be adding Bitcoin as payment option for Tip Jar. The platform’s tipping service could be launched in May of 2022.
Coinbase launches Ethereum staking (& earn rewards) for Britons and Germans. Coinbase has also removed the requirement to hold a balance of 32 ETH and the expertise needed to operate the ETH2 client software.
Vitalik Buterin considers NFTs to be the most surprising use case for Ethereum.
Fractionalized Doge NFT valued at $225 million after SushiSwap auction. The original Doge meme image became one of the highest valued NFTs. The auction raised 11,942 WETH (around $45m) from 1,796 buyers. (See NFT fractionalisation).
Are bonds trash?
Investor Bill Gross says that bonds are ‘investment garbage’. Why?
Investors buy bonds to limit the downside of investing in riskier (and more volatile) equities. Bonds are less risky, less volatile but they generate a lower return. They often balance an investment portfolio.
But according to Bill Gross (who co-founded Pacific Investment Management Co. in the 1970s and retired in 2019 in the US), as reported by Bloomberg, ‘bonds are trash’.
This is not unlike what Ray Dalio, the US billionaire hedge fund manager, expressed in June, when he said ‘I’d rather buy bitcoin than a bond’.
Why are ‘bonds trash’?
Government bonds are ‘investment garbage’ given their high prices and low yields, according to Bill Gross.
He says that investors in Treasuries (intermediate and long-term bonds) are likely to lose money.
Gross points out that given the US Federal Reserve will start tapering back its asset purchases (they will buy less bonds), raising interest rates may be the only option, which will drive bond yields up.
Bonds have an inverse relationship to interest rates
When the cost of borrowing rises or when interest rates rise, bond prices usually fall, and vice-versa.
Most bonds pay a fixed interest rate that becomes more attractive if interest rates fall, driving up demand and the price of the bond.
Conversely, if interest rates rise, investors will no longer prefer the lower fixed interest rate paid by a bond, resulting in a decline in its price.
Inflationary pressures
Ray Dalio points out that ‘inflationary pressures’ will also cause a change in ‘the amount that is in the hands of individuals’.
So whilst the value of cash (and bonds) is eroded, it could be good for assets such as real estate, stocks and cryptocurrencies (specifically bitcoin).
The Purse Podcast
How a one-woman startup built a global publishing brand
We cover the following in our conversation:
How Judy built her publishing business from the ground up
Self-funding a business to growth
Women's relationship with money
Financial independence
Angel investing Investing in female led innovation
Building wealth
Conscious leadership
And Judy's book: Ahead of Her Time: how a one-woman startup became a global publishing brand.
Listen on all podcasting channels including Spotify, iTunes and Google Podcasts.
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We’d love to hear from you. Get in touch with Jana via the The Purse website or tweet @jointhepurse and @janicka.
The Purse Ltd. Copyright 2021 & All Rights Reserved.
The Purse provides content for informational purposes only, we do not recommend products or services or provide investment advice. Please do your own research or speak to a financial advisor.
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