Alternative Investing Report - January 16, 2025

*as of 1/15; Sources: S&P, BTC, FTSE, DJRE, CL50

The Consumer Price Index (CPI) went up by 0.4% in December, which put the 12-month inflation rate at 2.9%, in line with forecasts. But the core CPI, which strips out food and energy costs, rose only 0.2% last month and 3.2% annually, both coming in below expectations. This data, along with better than expected Producer Price Index (PPI) and core PPI numbers released Tuesday, was an encouraging signal in the ongoing battle with inflation.

➨ TAKEAWAY: While the results were strong, all the metrics are still above the Fed’s stated 2% goal for inflation, so most analysts are still not expecting a rate cut anytime soon. But it is clear that the three rate cuts in 2024 have not led to significantly higher inflation, and any speculation about an upcoming rate hike looks to be quelled. The stock market reacted favorably to the CPI report, with the S&P 500 up 1.8%, and crypto markets were also up on the day.

A 1776 “Exeter” broadside edition of the Declaration of Independence is being auctioned on January 24 at Sotheby’s with a pre-sale estimate of $2 million - $4 million. Broadside editions were copies printed to distribute to the public in the days and weeks after the Declaration was finalized. This copy is one of just ten remaining of this broadside edition, and one of approximately 100 known broadside printings in general, with very few held privately.

➨ TAKEAWAY: A 1776 broadside sold for $3.36 million last June, while another sold for $2.9 million in July 2023. This specific copy last sold at Christie’s in 2021 for $930,000, so it will show significant appreciation if the sale falls within the estimate. That is a reflection of how rapidly the market for rare and historical documents has grown in the past few years.

🏡 Rent declines: The median asking rent nationwide ended 2024 at $1,594, down 0.3% year-over-year to its lowest level since March 2022, largely due to an increase in supply driven by record-high multifamily completion rates.

🎨 Phillips’ auction sales down: The auction house reported $721 million in auction revenue in 2024, a 14% decline from 2023. One bright spot was that nearly 10% of all bidders and buyers were first-timers under the age of 40.

🏢 CBRE acquires co-working company: The leading commercial real estate firm bought Industrious, which has more than 200 co-working spaces worldwide. CBRE had previously owned 40% of the company, and acquired the remaining 60% for $400 million.

📉 Climate tech funding falls: VC funding for climate tech startups fell by 17% in 2024, the third straight year of decline, with the pre-seed and seed deal count falling from 246 in 2023 to 152 in 2024.

💵 Apollo buys Argo: Alternative asset manager Apollo Global Management is buying Argo Infrastructure Partners, adding $6 billion in assets like digital infrastructure, renewable energy and transportation.

🪙 Ripple crosses $3: For the first time in over six years, the price of Ripple (XRP) passed the $3 mark, going up 30% this week and 500% since the November election.

As the Biden administration comes to an end, it announced a new rule dictating the export of AI chips and AI systems, referred to as the “AI Diffusion” rule. It places restrictions on chip sales to all but our 18 closest allies, and is particularly directed at Russia and China. Leading chipmaker Nvidia released a scathing response, saying the proposed rule is “unprecedented and misguided” and will hamper innovation. The rule will not go into effect for 120 days, so it will ultimately be up to the incoming Trump administration to enforce it, and there is no indication what their plans will be.