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Today's big stories

US inflation remained stuck at a 13-year high last month
Demand for water is higher than ever, and with supply drying up, there’s profit to be had – Read Now
Crypto exchange Coinbase reported better-than-expected results while warning of lower market volatility

Stuck On Repeat

What’s Going On Here?

Fresh data out Wednesday revealed the most widely watched US inflation rate refused to budge from a 13-year high last month.

What Does This Mean?

With demand rebounding, supply bottlenecks continuing, and the country’s government pumping trillions of dollars into the American economy, consumer prices were 5.4% higher in July 2021 than they were in July 2020 (tweet this). That was a slightly bigger rise than economists had anticipated – and unchanged from the previous month’s inflation rate, the largest such surge since 2008.

Looking behind the headline figures, however, the “core” US inflation measure – which excludes unstable food and energy costs – eased slightly to 4.3% last month, compared to 4.5% in June. Price rises also relaxed on a month-on-month basis: goods and services were 0.5% more expensive in July than a month before, down from June’s chunky 0.9% gain.

Why Should I Care?

For markets: Flattening the curve.
Taken together, the figures suggest that US inflation may have peaked – potentially vindicating the Federal Reserve’s view that recent upticks are only temporary and that pandemic-related shortages will eventually evaporate. That could leave America’s central bank in little hurry to increase interest rates or start scaling back its $120 billion-a-month bond-buying program. Since the latter would remove a major source of demand for US government bonds, relieved investors bought more of them on Wednesday – pushing their yields, which move inversely to prices, lower.

The bigger picture: Let ‘er rip.
Whether inflation has indeed peaked remains hotly debated. Government support has played a major role in recent price rises, and there may be much more to come: the US Senate passed a $3.5 trillion budget blueprint on Wednesday, just a day after approving a roughly $1 trillion infrastructure spending package. That brings both plans one step closer to reality – along with their injection of near-unprecedented levels of government funding into the American economy.

You might also like: 17 stocks poised to benefit from America’s infrastructure plan.

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2. Analyst Take

How Investing In Water Could Buoy Up Your Portfolio

What’s Going On Here?

There’s no more essential commodity than water – but with the planet warming up, the world’s supply is dwindling. That’s just one reason why now could be a good time to consider investing.

As the global population grows larger and wealthier, demand for fresh and clean water is growing with it. And not just for drinking: a reliable water supply is critical for the world’s future food production.

There are plenty of publicly traded companies in the water sector to add to your portfolio: everything from utilities to firms developing innovative treatment technologies.

And if you want to spread your cash across several companies, there’s a cascade of water-focused ETFs too.

For those looking to skip the stock market entirely, meanwhile, there’s an unusual alternative way to make a play on the waterworld – one endorsed by none other than the guy from The Big Short…

Read or listen to the Insight here

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Coinboom And Coinbust

What’s Going On Here?

Coinbase’s sophomore set of earnings as a public company surpassed analysts’ expectations this week – but the crypto exchange says it’ll suffer as token prices stabilize.

What Does This Mean?

Coinbase saw its revenue surge more than tenfold last quarter compared to the same time last year, totaling an impressive $2 billion. And no wonder: crypto markets experienced some of their wildest swings in a while last quarter, with investors tripping over themselves to trade fast-moving digital currencies on Coinbase’s platform. So many investors, in fact, that the company’s monthly active users were up 44% on the quarter before, reaching nearly 9 million. But the fun can’t last forever: Coinbase warned that declining crypto price volatility this quarter has begun to cause a drop in user activity that’ll likely hit its future financials.

Why Should I Care?

The bigger picture: Try not to concentrate on it.
Coinbase’s $2 billion quarterly revenue is even more impressive when you consider that the nine-year-old crypto kid took in more cash than established marketplace operators like CME Group and Intercontinental Exchange. But size isn’t everything. A huge chunk of Coinbase’s revenue comes from trading in a single cryptocurrency: bitcoin. That makes its sales a lot riskier than traditional exchanges where revenue is more balanced across trading in many different assets.

Zooming out: The Sword of Satoshi.
Crypto markets face constant threats from new government regulation and malicious hacks – and this week brought examples of both. The US president’s proposed infrastructure bill, which is now through the Senate, promises to impose stricter tax reporting requirements on crypto brokers. Late on Tuesday, meanwhile, it emerged that cyberpunks had pulled off what could be decentralized finance’s biggest-ever heist. Around $600 million worth of cryptocurrency was stolen from users of the cross-blockchain Poly Network platform – but in a strange twist, the hackers promptly returned roughly half of their loot on Wednesday.

You might also like: Should you buy Coinbase?

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💬 Quote of the day

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– Cory Doctorow (a Canadian-British blogger, journalist, and author)

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📈 Up with ether

Why is ether constantly second fiddle to bitcoin? Where will it go from here? Can it ever overtake the OG crypto? All of these questions and more, answered at our How To Value Ethereum event. It’ll be a doozy.

🤑 How To Value Ethereum: 5pm UK time, August 12th
✅ How To Be Greener About Bitcoin: 1pm UK time, August 17th
💥 How To Profit From The Commodities Boom: 5pm UK time, August 18th
🔌 Strategies To Supercharge Your Investments: 1pm UK time, August 20th
😎 How To Invest In Smart Contracts: 5pm UK time, August 24th
🤔 Are You An Investor Or A Trader?: 12pm UK time, August 25th
🙌 How To Create A Diversified Portfolio: 1pm UK time, August 26th
🚀 How To Profit From Open Banking: 5pm UK time, August 27th
💰 How To Value Any Company: 6pm UK time, August 31st
💉 How To Get Your Dose Of Healthcare 2.0: 5pm UK time, September 1st
♻️ How To Turn Your Portfolio Green : 6pm UK time, September 23rd
🤠 How To Win Big With Fractional Shares: 5pm UK time, September 28th

🎯 On Our Radar

The day the string music died. Thanks to global warming, that is.
The parallel park that sparked internet wrath. Yes, really.
Is being busy really better? Sometimes, but there’s a sweet spot.
How the Olympic medal table explains the world. Medal counts give a surprisingly accurate picture.
Counting calories? These apps might be sharing your data.

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Finimize - 😕 Crypto's biggest (and weirdest) hack

Today's big stories

Stuck On Repeat

What’s Going On Here?

What Does This Mean?

Why Should I Care?

How Investing In Water Could Buoy Up Your Portfolio

Save money on your mortgage

Coinboom And Coinbust

What’s Going On Here?

What Does This Mean?

Why Should I Care?

Simplicity is bliss

📈 Up with ether

Older messages

🏅 Why gold's still worth buying

🤑 AMC's doing a Tesla

🔥 Aramco fans the flames

🃏 Pick an ETF, any ETF

🇺🇸 Shut up and drive (an EV)

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