Recollecting President Carter, bitcoin’s 16th anniversary and recent woes for Apple and Tesla.
2025 has started with loss, both in the markets and in our world.
We lost Jimmy Carter, 39th president of the United States and winner of the 2002 Nobel Peace Prize, who died peacefully at his home in Plains, Georgia, surrounded by his family. He was 100, the longest-lived president in U.S. history.
An outpouring of love from around the world has emerged in recent days as people celebrated Carter’s life as a humanitarian, faith leader, politician and Navy veteran. World leaders, nonprofit organizations, military personnel and politicians from across the aisle, especially in his home state of Georgia, honored his work in eradicating disease, brokering peace in the Middle East, advancing civil rights and overseeing free and fair elections across the globe, with many of them highlighting his moral compass and sense of decency.
Carter will be given an official state funeral on January 9 and laid to rest with his beloved wife Rosalynn in Georgia. U.S. stock markets will be closed on that day in observance of a National Day of Mourning.
We also lost 14 American citizens in an ISIS-inspired terrorist attack in New Orleans during the early hours of New Year’s Day. The rampage turned normally festive Bourbon Street into a horrific scene of violence as maimed victims, bloodied bodies and scared pedestrians fled for safety inside nightclubs and restaurants. In addition to the confirmed dead, dozens were injured, but the carnage could have been even worse, as the suspect planted explosive devices which did not detonate. He was killed after exchanging gunfire with police.
In what is being described as an unrelated incident, a decorated active-duty military officer killed himself before allegedly exploding a Tesla Cybertruck in front of Trump International Hotel in Las Vegas on New Year’s morning. Fortunately, bystanders only suffered minor injuries.
Like all of us, the financial markets were rattled by these losses, with stocks trading lower upon reopening after the holiday, while bonds, the U.S. dollar and oil caught a flight-to-quality bid. The market was also not impressed as Tesla reported its first yearly sales decline as well as disappointing fourth-quarter deliveries of only 495,000 vehicles, shy of the 510,000 that Wall Street had expected.
Tesla sales have been hurt by cheap gasoline, competition from Chinese electric-vehicle companies and the growing popularity of hybrid vehicles. Nevertheless, the stock price has run up as Elon Musk’s role and influence in the Trump administration solidified following the election. With fundamentals back into focus, Tesla stock took a -6% hit.
Apple also joined in on the downturn on worries about iPhone demand after it was reported the consumer electronics giant had to cut prices in China to compete with domestic rivals such as Huawei. On a more positive note, this morning the Institute of Supply Management (ISM) released the December manufacturing purchasing managers index, which rose to a nine-month high of 49.3 from 48.4 in November. While factories faced higher prices into year end, orders and production appear to be rebounding, though they are still in contraction territory as the index remains below 50.
Today marks 16 years since pseudonymous founder Satoshi Nakamoto created the genesis block for bitcoin, breaking trail for the crypto era. It is also the one-year anniversary of crypto spot price exchange-traded funds (ETFs), which have amassed over $100 billion in assets, equivalent to about 5% of all bitcoin in existence and more than its creator allegedly controls.
With the incoming Trump administration full of crypto-friendly appointees, and the president-elect himself saying he wants to make America the “crypto capital of the planet and the bitcoin superpower of the world,” it would seem crypto could continue its meteoric rise. Institutional and high-net-worth investors remain wary of its volatility, however, as swings of 10% or more of its value in just one day are not uncommon.
Unlike other financial assets, crypto’s value depends on what people will pay for it at a point in time based on what they think someone else will pay for it in the future. It is not backed by anything else, such as tax revenue or corporate earnings. That said, if bitcoin were to be considered as a government reserve, or given a statutory framework by Congressional legislation, it could become more mainstream. We shall see.
I spent the last few days in Washington D.C. with my children, taking in some sights and sporting events. On the National Mall, past two large pieces of granite, stands a 30-foot stone figure of Dr. Martin Luther King, Jr. named the “Stone of Hope.” It symbolizes the line from King’s famous “I have a dream” speech: “Out of a mountain of despair, a stone of hope.” Let us all find our hope following this week’s somber events and stay focused on our goals and our loved ones as we start this new year together.
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