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    Bitcoin Hits Record High, Recovering From 2022 Meltdown

    Bitcoin’s price surged above $68,800, breaking the record the digital currency set in November 2021 when the crypto industry was booming.Bitcoin hit a record high of about $68,800 on Tuesday, capping a remarkable comeback for the volatile cryptocurrency after its value plunged in 2022 amid a market meltdown.Bitcoin’s price has risen more than 300 percent since November 2022, a resurgence that few predicted when the price dropped below $20,000 in 2022. Its previous record was just under $68,790 in November 2021, as crypto markets boomed and amateur investors poured savings into experimental digital coins.“This is just the beginning of this bull market,” said Nathan McCauley, the chief executive of the crypto company Anchorage Digital. “The best is yet to come.”Bitcoin’s recent surge has been driven by investor enthusiasm for a new financial product tied to the digital coin. In January, U.S. regulators authorized a group of crypto companies and traditional finance firms to offer exchange-traded funds, or E.T.F.s, which track Bitcoin’s price. The funds provide a simple way for people to invest in the crypto markets without directly owning the virtual currency.As of last week, investors had poured more than $7 billion into the investment products, propelling Bitcoin’s rapid rise, according to Bloomberg Intelligence.The price of Ether, the second-most-valuable digital currency after Bitcoin, has also risen this year. Its increase has been driven partly by enthusiasm over the prospect that regulators may also approve an E.T.F. tied to Ether.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    At BlackRock, State Street and Vanguard, Millions of Investors Are Getting a Voice

    BlackRock, State Street and Vanguard have opened up voting on environmental, social and management issues. It’s not true shareholder democracy, but it’s progress.Index fund investing has swept the world. In December, for the first time, U.S. investors entrusted more money to index funds than actively managed funds, in which a manager picks stocks or bonds for you.There’s a good reason for the index funds’ popularity. For most people, owning a little piece of the entire market, which you can do at low cost with an index fund, has been more profitable than buying and selling securities, either on their own or through a manager.But the relentless growth of index funds has come at a cost. One significant problem is that the most diversified funds own shares in every publicly traded company in the market, and if you don’t like a company, or its specific policies, you’re stuck. You couldn’t even exercise your vote on issues you thought were important because until recently, the fund managers insisted on doing that for you.Well, that’s been changing in a big way.BlackRock announced this month that it was expanding an experimental program to give investors six flavors of policy choices — like a focus on climate change or a preference for religious values — in votes on corporate issues. State Street already has a similar program underway, and Vanguard is tiptoeing into this kind of voting choice, too.All told, the three giant fund companies have given scores of millions of investors, with $4.6 trillion in assets, a way of expressing their views on corporate issues. This is certainly an improvement. And it could eventually lead to profound changes throughout corporate America, even as it eases some ticklish problems for the big index fund companies.The ProblemsIn the view of scholars like John Coates, the author of “The Problem of 12: When a Few Financial Institutions Control Everything,” the growth of index funds has had the unintended consequence of diminishing shareholder democracy.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    How Sustainable Is the Rally in Renewable Energy Stocks?

    AdvertisementContinue reading the main storySupported byContinue reading the main storyHow Sustainable Is the Rally in Renewable Energy Stocks?Solar and wind power companies have soared in value. Are they in a bubble or in a virtuous upward cycle?Installing solar panels on a rooftop in Fort Greene, Brooklyn. Solar power is the cheapest source of electricity in many countries, according to the International Energy Agency.Credit…Karsten Moran for The New York TimesJan. 14, 2021Updated 1:50 p.m. ETThe overall stock market was fabulous last year, but as investors focused on climate change, renewable energy stocks did even better.Consider that while the SPDR S&P 500 Exchange-Traded Fund Trust, which tracks the benchmark S&P 500, returned 18.37 percent in 2020, the Invesco Solar E.T.F., which tracks an index of solar energy stocks, soared 233.95 percent, according to Morningstar Direct. The Invesco WilderHill E.T.F., which invests more broadly in alternative energy of various types, rose 204.83 percent.Returns like those are so strong that they are unlikely to be replicated: It is possible that the stocks of companies engaged in carbon-free energy production are already in a bubble. Jason Bloom, head of fixed income and alternative E.T.F.s for Invesco, describes the sector this way: “I would call it rational optimism in view of improving fundamentals.”The International Energy Agency recently called solar-generated energy the “cheapest” electricity source in many countries. In the United States, it accounts for just 3 percent of energy output, but it is increasing rapidly. Wind power, which now supplies roughly 8 percent of domestic energy, has also been growing. There is plenty of room for expansion for many renewable energy companies.The results of the presidential election have already bolstered the returns of these companies, too. While President Trump has promoted the use of fossil fuels like coal, President-elect Joseph R. Biden Jr. has advocated a $2 trillion climate plan to “achieve a carbon pollution-free power sector by 2035.” His plan, not yet fully detailed, includes a variety of investment inducements and tax breaks.That would be more ambitious than the once-trendsetting 2045 goal of carbon-free energy production set by California. Already, solar power accounts for 18 percent of electricity generation at the utility Southern California Edison, said Erica Bowman, the company’s director of resource and environmental planning and strategy.Garvin Jabusch, chief investment officer for Green Alpha Advisors, an alternative energy investor, notes that the cost of generating electricity from solar energy is 90 percent lower than 10 years ago. Mr. Jabusch expects alternative energy prices to decline further with expanded demand. Mr. Jabusch favors companies that are “growing production capacity,” like First Solar, which has opened a new plant in Lake Township, Ohio, to expand production of its solar panels.For all its promise, investment in solar and wind power is limited by the laws of nature: Solar units can produce electricity only when the sun is shining, and wind turbines need wind.For the most part, Southern California Edison backs up its solar power with electricity generated by natural gas. But the utility recently contracted for nearly 600 megawatts of lithium ion battery storage so it can store excess electricity produced under ideal weather conditions.“Battery prices are down 90 percent over the last five to eight years,” Ms. Bowman said. “As we transition to a cleaner grid, solar generation coupled with battery storage is the cost-effective solution for California,” she added.Hydrogen fuel cells, which produce electricity by combining hydrogen and oxygen, have emerged as a possible near-term solution for use in trucking and shipping, says Mr. Bloom. But such applications will require a costly expansion of the hydrogen gas filling station network, said Steve Capanna, director of U.S. climate policy and analysis for the Environmental Defense Fund. Right now, he said, beyond “a handful in California,” there aren’t many such stations.Buying shares of renewable energy stocks now requires a degree of faith, because they are so expensive, partly because of the low interest rates engineered by the Federal Reserve, which have helped to drive the overall stock market higher. Fed support may be the biggest reason the market has withstood all the grim economic news of the coronavirus to continue its seemingly unending valuation advance.Paul Coster, a JPMorgan analyst, said that the high prices in the renewables sector are based on solid achievement. “It’s not like the dot-com era,” he said. “These are real actors with real technology.” He added, “We’re living in this wonderful moment in time when virtue and self-interest coincide.”Perhaps, Mr. Coster mused, there are still good reasons to own some of these stocks. He cited FuelCell Energy, which has negative cash flow and has consistently reported quarterly earnings losses. Mr. Coster said investors may want to project out several years.By 2025, he said, it’s “feasible” that FuelCell Energy would have $60 million in earnings before interest, taxes, depreciation and amortization, justifying a rich, growth stock valuation. Even so, the company’s shares more than doubled in the last month, and on Jan. 14, Mr. Coster warned that at current prices, the stock was already “richly valued.”AdvertisementContinue reading the main story More