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Agriculture

John Deere Announces 112 More Iowa Layoffs at Waterloo Works

2024-12-09

The Des Moines Register's Kevin Baskins recently brought to light the ongoing layoffs at John Deere. The agricultural and construction equipment giant announced another round of layoffs at its Waterloo Works, the company's largest plant. According to the state's Worker Adjustment and Retraining Notification (WARN) website, 112 workers will be laid off effective January 5th. This marks the sixth layoff by Deere in Waterloo in 2024, with a total of 1,075 workers cut so far. In Iowa alone, John Deere has shed 1,702 jobs at its various plants and offices in 2024. Additionally, 103 workers at the Ottumwa plant were offered early retirement in June.

Deere's Production Cuts Amidst a Difficult Agricultural Economy

Agriculture Dive's Nathan Owens reported that Deere has been aggressively cutting production of its tractors. The demand for new farm equipment has stalled due to a difficult agricultural economy. As stated in a Deere spokesperson's statement, "Challenging market conditions continue to result in reduced demand for our equipment. To remain globally competitive, we must continue making workforce adjustments as needed to our manufacturing footprint." With high interest rates, low farm incomes, and weak commodity prices, borrowers are postponing large purchases, making it challenging for tractor dealers to move their inventory. Sales of construction equipment have also decreased as fewer families are buying new homes.

John Deere's Plans to Move Production to Mexico

AgDaily reported that John Deere has faced public criticism over its plans to move some production to Mexico by 2026. Despite insisting that current layoffs are unrelated to production moves, some former employees are exploring wrongful termination lawsuits, citing age discrimination cases. This has added another layer of complexity to the company's situation.

Farmer Sentiment Despite the Ag Economy Downturn

Despite the ag industry downturn contributing to many layoffs, Purdue's Ag Economy Barometer reported that farmer sentiment jumped again in November. The Purdue University/CME Group Ag Economy Barometer climbed 30 points to a reading of 145, marking the highest level of farmer optimism since May 2021. Driven by considerable gains in both the Current Conditions and Future Expectations indices, farmers reported a more positive outlook for their operations and the broader agricultural economy. The percentage of producers expecting their farm's financial performance to improve over the next year climbed to 33% from 19% in October. Optimism about the U.S. agricultural sector also surged, with 34% of farmers anticipating good times financially in the next 12 months, more than double October's 15%. Looking ahead five years, over half of November's respondents (52%) predicted widespread prosperity for U.S. agriculture, a notable increase from 34% the previous month. This growing confidence was also reflected in farmers' investment plans, with 22% reporting that it's a good time for large capital investments compared to 15% in October.

XRP, the token used by Ripple, has witnessed a significant price decline in recent days. On Monday, December 9, 2024, its price dropped by 9%, hitting intraday lows of $2.36. While XRP/USDT on Binance remains near all-time highs, this decline marks the steepest drop in over two months. The cryptocurrency market is showing a notable divergence as XRP experiences significant selling pressure.

Market Metrics and Technical Analysis

On the intraday hourly chart, XRP's price has dropped below short-term support around $2.4597, breaking through the trendline drawn from local lows at $2.0275. This indicates the potential for further short-term depreciation toward the mentioned support levels or the trendline extending from the late-November lows.Support Zones:- $1.5971: The peak from November 24.- $1.9951: Local highs from late November to early December.- $2.2075: The trendline coinciding with early December lows.Resistance Zones:- Trendline originating from December 5.- $2.4957: A zone defined by early December highs.- $2.7897: Local highs from December.- $2.8681: Another set of local highs from December.On the daily chart (D1), the long-term outlook for XRP remains bullish, with a projected rise toward the $5 mark. This optimistic forecast is based on a technical pattern evident on the chart. A "pole" formed throughout November, followed by the current correction resembling a "flag." A breakout above this flag pattern could result in a measured target near double the current price levels. At the same time, XRP is holding support at the 23.6% Fibonacci retracement level, near $2.33, which could provide a foundation for potential recovery if buying pressure increases.Some of the forecasts are even more ultra-bullish. However, in the short term, the funding rate has turned negative at -0.0885%, suggesting strong bearish sentiment in derivatives markets. Open interest has declined by 4.25%, reflecting diminishing trader confidence.

Fundamental Factors Impacting XRP Price

Bitcoin's Dominance: Bitcoin's historic breakthrough to $100,000 has redirected market focus and capital flows. While BTC's November rally provided support for XRP, investor focus has now shifted back to the leading cryptocurrency. This shift has led to increased capital inflows into BTC, resulting in a relative decline in demand for altcoins like XRP.Regulatory Environment: Despite Trump's nomination of a pro-crypto SEC chair candidate, ongoing regulatory uncertainties continue to impact XRP's market performance. The previous legal battles have left a lasting impact on investor sentiment.

Price Prediction and FAQ

Why is XRP falling? XRP is falling due to a combination of factors, including profit-taking after November's rally, bearish sentiment in derivatives markets, and broader market liquidations. Over $14.5 million in leveraged long XRP positions were liquidated in the last 24 hours, amplifying the downward pressure. Additionally, market attention has shifted toward Bitcoin following its historic surge to $100,000, diverting capital flows away from altcoins like XRP.Will XRP ever go up in price? Despite the current decline, XRP's long-term outlook remains bullish based on technical patterns such as the flag formation on the daily chart. If the price breaks out above the current correction zone, it could target levels near $5. However, this is contingent on increased buying pressure and improved market sentiment.How low can XRP price fall? In the short term, XRP could test lower support levels around $2.2075 or $1.9951, as suggested by the intraday chart. A breach of these levels might push the price toward $1.5971, the peak from late November. The price could also revisit the 23.6% Fibonacci retracement level at $2.33 if selling pressure persists.Is XRP worth holding? XRP remains a speculative asset with both high risks and high rewards. Its long-term bullish potential, as indicated by technical analysis, may appeal to investors with a higher risk tolerance. However, ongoing regulatory uncertainties and market volatility require careful consideration. Holding XRP should align with an investor's broader strategy and risk appetite.

Last week's announcement by Donald Trump to nominate Paul Atkins as the head of the Securities and Exchange Commission (S.E.C.) sent shockwaves through the crypto world. The price of Bitcoin soared to a hundred thousand dollars, and crypto enthusiasts were in a celebratory mood. This reminded me of the dot-com boom and its inevitable bust, which I chronicled over twenty years ago. There was the same excitement, predictions of higher prices, and uneasy feelings among some market participants.

Investment and Policy Shifts

Crypto investors, entrepreneurs, and pro-crypto donors had ample reason to be excited. Investing in Trump's victory and defeating crypto skeptics paid off. Under Gary Gensler's leadership, the S.E.C. took an aggressive approach towards the crypto industry. But with Paul Atkins in charge, the agency's lawsuits and cases may be put on hold, and a more friendly stance towards crypto assets is likely. "For crypto assets, the fundamental rules will be weakened, and the industry will expand with little regulation," said Dennis Kelleher. Crypto leaders hailed Atkins' choice as a landmark.

Comparison with Dot-com Boom

In the late 1990s, the dot-com boom was underpinned by the rise of online commerce. Speculative digital assets like Bitcoin can't be directly compared to those startups. But big speculative episodes rest on four factors: a new technology, an efficient communication method, financial industry participation, and a supportive policy environment. With crypto assets, Bitcoin and the blockchain met the first two requirements, but Wall Street and policymakers were suspicious. In the 2022-23 crypto bust, Bitcoin's price fell by more than 70%, and some big crypto firms collapsed. But with Trump in office, all four conditions seem to be in place for a broader bubble.

SEC's Stance on Crypto Assets

The S.E.C. is at the center of the crypto debate. During Gary Gensler's tenure, the agency argued that many crypto assets are securities and face extensive regulations. But under Paul Atkins, the S.E.C. may shift its position on whether crypto assets are securities or more like physical commodities. This could have significant implications for crypto firms like Coinbase and Ripple. A federal judge's ruling in favor of the S.E.C. against Coinbase was seen as a win, but the Ripple lawsuit had a different outcome.

Wall Street's Embrace of Crypto

After losing a court case in 2023, the S.E.C. approved Bitcoin exchange-traded funds (E.T.F.s), which have seen a significant increase in value since the election. BlackRock, Fidelity, and Franklin Templeton are among the financial firms offering these products, and Charles Schwab offers a "Crypto Thematic ETF". This is encouraging other financial firms to launch similar products.

Risks and Concerns

Economist Eswar Prasad is worried that recent developments could give the wrong impression about crypto assets. A full-blown financial blowup is a worst-case scenario, as seen in the real-estate bubble. Federal banking regulators have tried to keep crypto confined, but history isn't reassuring. During the 2022-23 crypto bust, three banks with ties to the crypto industry failed. Dennis Kelleher predicts that a second Trump Administration could lead to more crypto movement into the financial system.In conclusion, the Trump crypto boom presents both opportunities and risks. The future of crypto remains uncertain, and it will be interesting to see how these developments unfold.